<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended Commission File Number
September 30, 1995 0-12052
DYCO OIL AND GAS PROGRAM 1983-1
(A LIMITED PARTNERSHIP)
(Exact Name of Registrant as specified in its charter)
Minnesota 41-1451945
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or organization) Number)
Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103
------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(918) 583-1791
----------------------------------------------------
(Registrant's telephone number, including area code)
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 X No
---- ----
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, December 31,
1995 1994
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents . . . . . . $ 137,507 $ 59,992
Accrued oil and gas sales, including
$87,621 and $138,468 due from
related parties (Note 2) . . . . . . 101,708 158,161
---------- ----------
Total current assets . . . . . . . $ 239,215 $ 218,153
NET OIL AND GAS PROPERTIES, utilizing
the full cost method . . . . . . . . . 742,739 885,812
DEFERRED CHARGE . . . . . . . . . . . . . 51,707 51,707
---------- ----------
$1,033,661 $1,155,672
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable . . . . . . . . . . . $ 11,064 $ 39,425
Gas imbalance payable . . . . . . . . 9,893 9,893
---------- ----------
Total current liabilities . . . . . $ 20,957 $ 49,318
ACCRUED LIABILITY . . . . . . . . . . . . 127,160 127,160
PARTNERS' CAPITAL:
General Partner, issued and outstanding,
76 units . . . . . . . . . . . . . . 8,855 9,792
Limited Partners, issued and outstanding,
7,600 units . . . . . . . . . . . . 876,689 969,402
---------- ----------
Total Partners' capital . . . . . . $ 885,544 $ 979,194
---------- ----------
$1,033,661 $1,155,672
========== ==========
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
1995 1994
---------- ----------
REVENUES:
Oil and gas sales, including
$103,145 and $236,455 of sales
to related parties (Note 2) . . . . $115,847 $247,305
Interest . . . . . . . . . . . . . . . 3,026 1,613
-------- --------
$118,873 $248,918
-------- --------
COSTS AND EXPENSES:
Oil and gas production . . . . . . . . $ 36,995 $ 54,780
Depreciation, depletion, and amortization
of oil and gas properties . . . . . 33,049 33,674
General and administrative (Note 2) . 19,953 19,790
-------- --------
$ 89,997 $108,244
-------- --------
NET INCOME . . . . . . . . . . . . . . . $ 28,876 $140,674
======== ========
GENERAL PARTNER (1%) - net income . . . . $ 288 $ 1,407
======== ========
LIMITED PARTNERS (99%) - net income . . . $ 28,588 $139,267
======== ========
NET INCOME PER UNIT . . . . . . . . . . . $ 4 $ 18
======== ========
UNITS OUTSTANDING . . . . . . . . . . . . 7,676 7,676
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
1995 1994
---------- ----------
REVENUES:
Oil and gas sales, including
$445,474 and $818,061 of sales
to related parties (Note 2) . . . . $517,081 $854,551
Interest . . . . . . . . . . . . . . . 6,732 4,696
-------- --------
$523,813 $859,247
-------- --------
COSTS AND EXPENSES:
Oil and gas production . . . . . . . . $172,590 $157,911
Depreciation, depletion, and amortization
of oil and gas properties . . . . . 142,082 187,923
General and administrative (Note 2) . 72,511 65,491
-------- --------
$387,183 $411,325
-------- --------
NET INCOME . . . . . . . . . . . . . . . $136,630 $447,922
======== ========
GENERAL PARTNER (1%) - net income . . . . $ 1,366 $ 4,479
======== ========
LIMITED PARTNERS (99%) - net income . . . $135,264 $443,443
======== ========
NET INCOME PER UNIT . . . . . . . . . . . $ 18 $ 58
======== ========
UNITS OUTSTANDING . . . . . . . . . . . . 7,676 7,676
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
1995 1994
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income . . . . . . . . . . . . . . $136,630 $447,922
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation, depletion, and amortiza-
tion of oil and gas properties . . . . 142,082 187,923
Decrease in accrued oil and gas sales 56,453 125,260
Decrease in accounts payable . . . . ( 28,361) ( 42,659)
Decrease in gas imbalance payable . - ( 5,140)
Increase in accrued liability . . . - 317
-------- --------
Net cash provided by operating
activities . . . . . . . . . . . $306,804 $713,623
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to oil and gas properties . $ - ($ 9,360)
Retirements of oil and gas properties 991 -
-------- --------
Net cash provided (used) by investing
activities . . . . . . . . . . . $ 991 ($ 9,360)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions . . . . . . . . . . ($230,280) ($805,980)
-------- --------
Net cash used by financing
activities . . . . . . . . . . . ($230,280) ($805,980)
-------- --------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS . . . . . . . . . . . . . $ 77,515 ($101,717)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD . . . . . . . . . . . . . . 59,992 187,098
-------- --------
CASH AND CASH EQUIVALENTS AT END
OF PERIOD . . . . . . . . . . . . . . $137,507 $ 85,381
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
CONDENSED NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1995
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The balance sheets as of September 30, 1995, statements of
operations for the three and nine months ended September 30, 1995
and 1994, and statements of cash flows for the nine months ended
September 30, 1995 and 1994 have been prepared by Dyco Petroleum
Corporation ("Dyco"), the General Partner of the Dyco Oil and Gas
Program 1983-1 Limited Partnership (the "Program"), without
audit. In the opinion of management all adjustments (which
include only normal recurring adjustments) necessary to present
fairly the financial position at September 30, 1995, results of
operations for the three and nine months ended September 30, 1995
and 1994 and changes in cash flows for the nine months ended
September 30, 1995 and 1994 have been made.
Information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
It is suggested that these financial statements be read in
conjunction with the financial statements and notes thereto
included in the Program's Annual Report on Form 10-K for the year
ended December 31, 1994. The results of operations for the
period ended September 30, 1995 are not necessarily indicative of
the results to be expected for the full year.
The limited partners' net income or loss per unit is based upon
each $5,000 initial capital contribution.
OIL AND GAS PROPERTIES
----------------------
Oil and gas operations are accounted for using the full cost
method of accounting. All productive and non-productive costs
associated with the acquisition, exploration and development of
oil and gas reserves are capitalized. Sales and abandonments of
properties are accounted for as adjustments of capitalized costs
with no gain or loss recognized, unless such adjustments would
significantly alter the relationship between capitalized costs
and proved oil and gas reserves.
The provision for depreciation, depletion, and amortization of
oil and gas properties is calculated by dividing the oil and gas
sales dollars during the year by the estimated future gross
income from the oil and gas properties and applying the resulting
rate to the net remaining costs of oil and gas properties that
have been capitalized, plus estimated future development costs.
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2. TRANSACTIONS WITH RELATED PARTIES
---------------------------------
Under the terms of the Program's partnership agreement, Dyco is
entitled to receive a reimbursement for all direct expenses and
general and administrative, geological and engineering expenses
it incurs on behalf of the Program. During the three months
ended September 30, 1995 and 1994 such expenses totaled $19,953
and $19,790, respectively, of which $17,820 and $17,820 were paid
to Dyco. During the nine months ended September 30, 1995 and
1994 such expenses totaled $72,511 and $65,491, respectively, of
which $53,460 and $53,460 were paid to Dyco.
Affiliates of the Program are the operators of certain of the
Program's properties and their policy is to bill the Program for
all customary charges and cost reimbursements associated with
their activities, together with any compressor rentals,
consulting, or other services provided.
The Program sells gas at market prices to Premier Gas Company
("Premier"), an affiliated company, and Premier may then resell
such gas to third parties at market prices. During the three
months ended September 30, 1995 and 1994 these sales totaled
$103,145 and $236,455, respectively. During the nine months
ended September 30, 1995 and 1994 these sales totaled $445,474
and $818,061, respectively. At September 30, 1995 accrued oil
and gas sales included $87,621 due from Premier.
-7-
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Net proceeds from the Program's operations less necessary
operating capital are distributed to investors on a quarterly
basis. The net proceeds from production are not reinvested in
productive assets, except to the extent that producing wells are
improved, or where methods are employed to permit more efficient
recovery of the Program's reserves which would result in a
positive economic impact. Over the last several years, the
domestic energy industry and the Program have contended with
volatile, but generally low, oil and gas prices. Over the past
few years, the oil and gas market appears to have moved from
periods of relative stability in supply and demand to excess
supply or weakened demand. These trends have led to the
volatility in pricing and demand noted over the past years.
The Program's available capital from subscriptions has been spent
on oil and gas drilling activities. There should not be any
further material capital resource commitments in the future. The
Program has no bank debt commitments. Cash for operational
purposes will be provided by current oil and gas production.
RESULTS OF OPERATIONS
- ----------------------
THREE MONTHS ENDED SEPTEMBER 30, 1995 AS COMPARED TO THE THREE
MONTHS ENDED SEPTEMBER 30, 1994.
Three months ended September 30,
--------------------------------
1995 1994
---- ----
Oil and gas sales $115,847 $247,305
Oil and gas production
expenses $ 36,995 $ 54,780
Barrels produced 207 349
Mcf produced 105,711 165,779
Average price/Bbl $ 17.22 $ 16.36
Average price/Mcf $ 1.06 $ 1.46
As shown in the table, oil and natural gas sales decreased by
53.2% for the three months ended September 30, 1995 as compared
to the three months ended September 30, 1994. This decrease was
due primarily to a decrease in the average price of natural gas
sold and decreases in the volumes of oil and natural gas sold
during the three months ended September 30, 1995 as compared to
the three months ended September 30, 1994. Volumes of oil and
natural gas sold decreased by 142 barrels and 60,068 Mcf,
respectively, for the three months ended September 30, 1995 as
compared to the three months ended September 30, 1994. The
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decrease in volumes of oil and natural gas sold resulted from (i)
decreased production as a result of one of the Program's wells
that is incapable of producing and was in the process of being
plugged and abandoned during the three months ended September 30,
1995 and (ii) positive prior period volume adjustments from a
purchaser on another of the Program's wells during the three
months ended September 30, 1994. Average natural gas prices
decreased to $1.06 per Mcf for the three months ended September
30, 1995 from $1.46 per Mcf for the three months ended September
30, 1994, while average oil prices increased to $17.22 per barrel
for the three months ended September 30, 1995 from $16.36 per
barrel for the three months ended September 30, 1994.
Oil and gas production expenses (including lease operating
expenses and production taxes) decreased $17,795 for the three
months ended September 30, 1995 as compared to the three months
ended September 30, 1994. This decrease resulted primarily from
workover charges incurred on one of the Program's wells during
the three months ended September 30, 1994. As a percentage of
oil and gas sales, these expenses increased to 31.9% for the
three months ended September 30, 1995 from 22.2% for the three
months ended September 30, 1994. This percentage increase was
primarily a result of the decrease in the average price of
natural gas sold during the three months ended September 30, 1995
as compared to the similar period in 1994.
Depreciation, depletion, and amortization of oil and gas
properties remained relatively constant for the three months
ended September 30, 1995 as compared to the three months ended
September 30, 1994. As a percentage of oil and gas sales, this
expense increased to 28.5% for the three months ended September
30, 1995 from 13.6% for the three months ended September 30,
1994. This percentage increase resulted primarily from the
decrease in the average price of natural gas sold during the
three months ended September 30, 1995 as compared to the three
months ended September 30, 1994.
General and administrative expenses remained relatively constant
for the three months ended September 30, 1995 as compared to the
three months ended September 30, 1994. As a percentage of oil
and gas sales, these expenses increased to 17.2% for the three
months ended September 30, 1995 as compared to 8.0% for the three
months ended September 30, 1994. This percentage increase was
primarily due to the decreases in the volumes of oil and natural
gas sold and a decrease in the average price of natural gas sold
during the three months ended September 30, 1995 as compared to
the three months ended September 30, 1994.
-9-
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<PAGE>
NINE MONTHS ENDED SEPTEMBER 30, 1995 AS COMPARED TO THE NINE
MONTHS ENDED SEPTEMBER 30, 1994.
Nine months ended September 30,
-------------------------------
1995 1994
---- ----
Oil and gas sales $517,081 $854,551
Oil and gas production
expenses $172,590 $157,911
Barrels produced 496 1,087
Mcf produced 413,969 508,358
Average price/Bbl $ 17.52 $ 15.41
Average price/Mcf $ 1.23 $ 1.65
As shown in the table, oil and natural gas sales decreased by
39.5% for the nine months ended September 30, 1995 as compared to
the nine months ended September 30, 1994. This decrease was due
primarily to a decrease in the average price of natural gas sold
and decreases in the volumes of oil and natural gas sold,
partially offset by the increase in the average price of oil sold
during the nine months ended September 30, 1995 as compared to
the nine months ended September 30, 1994. Volumes of oil and
natural gas sold decreased by 591 barrels and 94,389 Mcf,
respectively, for the nine months ended September 30, 1995 as
compared to the nine months ended September 30, 1994. The
decrease in volumes of oil and natural gas sold was primarily a
result of (i) positive prior period volume adjustments from a
purchaser on several wells during the nine months ended September
30, 1994 and (ii) decreased production from another well that is
incapable of producing and was in the process of being plugged
and abandoned during the nine months ended September 30, 1995.
Average natural gas prices decreased to $1.23 per Mcf for the
nine months ended September 30, 1995 from $1.65 per Mcf for the
nine months ended September 30, 1994, while average oil prices
increased to $17.52 per barrel for the nine months ended
September 30, 1995 from $15.41 per barrel for the nine months
ended September 30, 1994.
Oil and gas production expenses (including lease operating
expenses and production taxes) increased $14,679 for the nine
months ended September 30, 1995 as compared to the nine months
ended September 30, 1994. This dollar increase was primarily due
to workover charges incurred on one well to improve the recovery
of reserves and plugging and abandonment charges on another well
during the nine months ended September 30, 1995. As a percentage
of oil and gas sales, these expenses increased to 33.4% for the
nine months ended September 30, 1995 from 18.5% for the nine
months ended September 30, 1994. This percentage increase
resulted primarily from the dollar increase in production
expenses as discussed above and a decrease in the average price
of natural gas sold during the nine months ended September 30,
1995 as compared to the nine months ended September 30, 1994.
Depreciation, depletion, and amortization of oil and gas
properties decreased $45,841 for the nine months ended September
30, 1995 as compared to the nine months ended September 30, 1994.
This decrease was primarily due to the decreases in the volumes
of oil and natural gas sold during the nine months ended
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September 30, 1995 as compared to the nine months ended September
30, 1994 and an increase in the estimate of the Program's
remaining natural gas reserves. As a percentage of oil and gas
sales, this expense increased to 27.5% for the nine months ended
September 30, 1995 from 22.0% for the nine months ended September
30, 1994. This percentage increase was primarily due to the
decrease in the average price of natural gas sold during the nine
months ended September 30, 1995 as compared to the nine months
ended September 30, 1994.
General and administrative expenses increased $7,020 for the nine
months ended September 30, 1995 as compared to the nine months
ended September 30, 1994. This increase resulted from an
increase in the Program's professional fees during the nine
months ended September 30, 1995 as compared to the nine months
ended September 30, 1994. As a percentage of oil and gas sales,
these expenses increased to 14.0% for the nine months ended
September 30, 1995 as compared to 7.7% for the nine months ended
September 30, 1994. This percentage increase was primarily due
to the dollar increase in general and administrative expenses as
discussed above and the decrease in the average price of natural
gas sold and decreases in the volumes of oil and natural gas sold
during the nine months ended September 30, 1995 as compared to
the nine months ended September 30, 1994.
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PART II: OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
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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.
DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
(Registrant)
By: DYCO PETROLEUM CORPORATION
General Partner
Date: November 13, 1995 By: /s/Dennis R. Neill
-------------------------------
(Signature)
Dennis R. Neill
Senior Vice President
Date: November 13, 1995 By: /s/Patrick M. Hall
-----------------------------
(Signature)
Patrick M. Hall
Senior Vice President -Controller
Principal Accounting Officer
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<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000719958
<NAME> DYCO OIL AND GAS PROGRAM 1983-1 LIMITED PARTNERSHIP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 137,507
<SECURITIES> 0
<RECEIVABLES> 101,708
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 239,215
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,033,661
<CURRENT-LIABILITIES> 20,957
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 885,544
<TOTAL-LIABILITY-AND-EQUITY> 1,033,661
<SALES> 517,081
<TOTAL-REVENUES> 523,813
<CGS> 0
<TOTAL-COSTS> 387,183
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 136,630
<INCOME-TAX> 0
<INCOME-CONTINUING> 136,630
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 136,630
<EPS-PRIMARY> 18.00
<EPS-DILUTED> 0
</TABLE>
