CONFORMED COPY
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
For the period ended June 30, 2000
or
[ ] Transition Report Pursuant to Section 13 of 15(d) of
the Securities and Exchange Act of 1934
For the transition period from to
Commission file number 333-41977-04
I.R.S. Employer Identification Number 55-0757539
PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
103 East Main Street
Bridgeport, WV 26330
Telephone: (304) 842-6256
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes XX No
PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
INDEX
PART I - FINANCIAL INFORMATION Page No.
Item 1. Financial Statements
Balance Sheets - June 30, 2000 and December 31, 1999 1
Statements of Operations -
Three and Six Months Ended June 30, 2000 2
Statement of Partners' Equity -
Six Months Ended June 30, 2000 and 1999 3
Statement of Cash Flows-
Six Months Ended June 30, 2000 and 1999 4
Notes to Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6
PART II OTHER INFORMATION
Item 1. Legal Proceedings 8
Item 6. Exhibits and Reports on Form 8-K 8
PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
Balance Sheets
June 30, 2000 and December 31, 1999
<TABLE>
<C> <C> <C>
Assets
2000 1999
(Unaudited)
Current assets:
Cash $ 7,095 $ 8,038
Accounts receivable - oil and gas revenues 343,837 366,296
Total current assets 350,932 374,334
Oil and gas properties, successful
efforts method 10,123,711 10,123,711
Less accumulated depreciation, depletion,
and amortization 1,593,731 1,134,611
8,529,980 8,989,100
$ 8,880,912 $ 9,363,434
Current Liabilities and Partners' Equity
Current liabilities:
Accrued expenses $ 22,965 $ 34,302
Total current liabilities 22,965 34,302
Partners' Equity 8,857,947 9,329,132
$ 8,880,912 $ 9,363,434
</TABLE>
See accompanying notes to financial statements.
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PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
Statements of Operations
Three months and Six months ended June 30, 2000 and 1999
(Unaudited)
<TABLE>
<C> <C> <C> <C> <C>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
Revenues:
Sales of oil and gas $ 518,315 $ 189,470 $1,230,366 $ 203,706
Interest 4,387 - 4,387 -
522,702 189,470 1,234,753 203,706
Expenses:
Exploratory dry hole - 800,802 - 1,357,054
Lifting cost 229,700 53,907 516,063 60,167
Direct administrative cost - 25 - 25
Depreciation, depletion,
and amortization 194,558 181,043 459,120 195,275
424,258 1,035,777 975,183 1,612,521
Net income (loss) $ 98,444 $ (846,307) $ 259,570 $(1,408,815)
Net income (loss) per limited
and additional
general partner unit $ 76 $ (660) $ 202 $ (1,098)
</TABLE>
See accompanying notes to financial statements.
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PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
Statement of Partners' Equity
Six months ended June 30, 2000
(Unaudited)
<TABLE>
<C> <C> <C> <C>
Limited and
additional Managing
general partners general partner Total
Balance, December 31, 1999 $ 7,463,305 $1,865,827 $ 9,329,132
Distributions to partners (584,605) (146,150) (730,755)
Net income 207,657 51,913 259,570
Balance, June 30, 2000 $ 7,086,357 $1,771,590 $ 8,857,947
</TABLE>
See accompanying notes to financial statements.
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PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
Statements of Cash Flows
Six months ended June 30, 2000 and 1999
(Unaudited)
<TABLE>
<C> <C> <C>
2000 1999
Cash flows from operating activities:
Net income (loss) $ 259,570 $(1,408,815)
Adjustments to reconcile net income (loss)
to net cash provided from (used by)
operating activities:
Exploratory dry hole costs - 1,357,054
Depreciation, depletion, and amortization 459,120 195,275
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable -
oil and gas revenues 22,459 (143,539)
Decrease in accrued expenses (11,337) (12,859)
Net cash provided from (used by)
operating activities 729,812 (12,884)
Cash flows from financing activities:
Distributions to partners (730,755) -
Net cash used by financing activities (730,755) -
Net change in cash (943) (12,884)
Cash at beginning of period 8,038 20,000
Cash at end of period $ 7,095 $ 7,116
</TABLE>
See accompanying notes to financial statements.
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PDC 1998-D LIMITED PARTNERSHIP
(A West Virginia Limited Partnership)
Notes to Financial Statements
(Unaudited)
1. Accounting Policies
Reference is hereby made to the Partnership's Annual Report on
Form 10-K for 1999, which contains a summary of significant
accounting policies followed by the Partnership in the preparation
of its financial statements. These policies were also
followed in preparing the quarterly report included herein.
2. Basis of Presentation
The Management of the Partnership believes that all adjustments
(consisting of only normal recurring accruals) necessary to a fair
statement of the results of such periods have been made. The
results of operations for the six months ended June 30,
2000 are not necessarily indicative of the results to be expected
for the full year.
3. Oil and Gas Properties
The Partnership follows the successful efforts method of accounting
for the cost of exploring for and developing oil and gas reserves.
Under this method, costs ofdevelopment wells, including equipment
and intangible drilling costs related to both producing wells and
developmental dry holes, and successful exploratory wells are
capitalized and amortized on an annual basis to operations by the
units-of-production method using estimated proved developed reserves
which will be determined at year end by an independent petroleum
engineer. If a determination is made that an exploratory well has
not discovered economically producible reserves, then its costs are
expensed as dry hole costs.
-5-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Liquidity and Capital Resources
The Partnership was funded with initial Limited and Additional
General Partner contributions of $20,525,261 and the Managing General
Partner contributed $4,464,244 in accordance with the Agreement.
Syndication and management fee costs of $2,668,284 were incurred
leaving available capital of $22,321,221 for Partnership activities.
The Partnership began exploration and development activities
subsequent to the funding of the Partnership and completed well
drilling activities by March 31, 1999. Nintey-seven wells have been
drilled, of which eighty-nine have been completed as producing wells.
Operations will be conducted with available funds and revenues
generated from oil and gas activities. No bank borrowings are
anticipated.
The Partnership had net working capital at June 30, 2000 of
$327,967.
The Partnership's revenues from oil and gas will be affected by
changes in prices. As a result of changes in federal regulations,
gas prices are highly dependent on the balance between supply and
demand. The Partnership's gas sales prices are subject to increase
and decrease based on various market sensitive indices.
Results of Operations
Three Months Ended June 30, 2000 and 1999
Revenue and expenses during the second quarter of 2000 include
natural gas sales and related expenses for all of the Partnership's
wells. During the same period in 1999 all of the wells were not yet
turned into line and producing for the entire quarter. While the
Partnership experienced net income of $98,444, depreciation,
depletion and amortization is a non-cash expense and therefore the
Partnership distributed $336,746 to the partners during the second
quarter of 2000.
Six Months Ended June 30, 2000 Compared with 1999
Revenue and expenses during the first six months of 2000 include
natural gas sales and related expenses for all of the Partnership's
wells. During the same period in 1999 all of the wells were not
turned into line and producing for the entire period. While the
Partnership experienced net income of $259,570, depreciation,
depletion, and amortization is a non-cash expense and therefore the
Partnership distributed $730,755 to the partners during the first
six months of 2000.
Year 2000 Issue
PDC, who administers all aspects of the Partnership, experienced
no known disruptions as a result of the year date change and intends
to continue monitoring its critical systems at various other date
changes during the Year 2000.
PDC's expenditures for addressing Year 2000 issues were not
material, nor does the Company expect to incur any significant costs
addressing Year 2000 issues in the future.
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CONFORMED COPY
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 6. Exhibits and Reports on Form 8-K
(a) None.
(b) No reports on Form 8-K have been filed during the quarter ended
June 30, 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PDC 1998-D Limited Partnership
(Registrant)
By its Managing General Partner
Petroleum Development Corporation
Date: July 27, 2000 /s/ Steven R. Williams
Steven R. Williams
President
Date: July 27, 2000 /s/ Dale G. Rettinger
Dale G. Rettinger
Executive Vice President
and Treasurer
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