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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
MARK ONE
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1997
| | TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-11311
MAY DRILLING PARTNERSHIP 1983-1
MAY LIMITED PARTNERSHIP 1983-1
(Exact name of registrant as specified in its charter)
75-1896224
Texas 75-1896223
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
4582 South Ulster Street Parkway
Suite 1700
Denver, Colorado 80237
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 850-7373
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 |_|
Page 1 of 10
<PAGE>
<TABLE>
<CAPTION>
MAY DRILLING PARTNERSHIP 1983-1
BALANCE SHEETS
(Unaudited)
(In thousands)
June 30, December 31,
1997 1996
ASSETS
Investment in
<S> <C> <C>
May Limited Partnership 1983-1 $207 $179
==== ===
PARTNERS' CAPITAL
Partners' Capital $207 $179
==== ===
<FN>
NOTE: The statements of operations and cash flows for May Drilling
Partnership 1983-1 are not presented because such information is equal
to the limited partner's share of such activity as presented in the May
Limited Partnership 1983-1 financial statements. The May Drilling
Partnership carries its investment in May Limited Partnership 1983-1 on
the equity method. The May Limited Partnership 1983-1 financial
statements should be read in conjunction with these balance sheets.
</FN>
<FN>
The accompanying note is an integral part
of the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MAY LIMITED PARTNERSHIP 1983-1
BALANCE SHEETS
(Unaudited)
(In thousands)
June 30, December 31,
1997 1996
ASSETS
CURRENT ASSETS
<S> <C> <C>
Cash and cash equivalents $ 191 $ 115
Accrued oil and gas sales 31 59
Due from affiliate 6
---- ---
Total 228 174
---- ---
OIL AND GAS PROPERTIES, using the full cost method of
accounting 7,313 7,302
Less accumulated depletion (7,080) (7,063)
------ ------
Net oil and gas properties 233 239
------ ------
TOTAL ASSETS $ 461 $ 413
====== =======
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 10 $ 17
Due to affiliate 5
---- ---
Total 10 22
---- ---
PARTNERS' CAPITAL
General partner 244 212
Limited partner 207 179
--- ----
Total 451 391
--- ----
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 461 $ 413
======= =======
<FN>
The accompanying note is an integral part
of the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MAY LIMITED PARTNERSHIP 1983-1
STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Three Months Ended June 30,
1997 1996
----- ----
REVENUES
<S> <C> <C>
Oil revenue $ 6 $ 11
Gas revenue 41 76
Interest 2 1
--- ---
Total 49 88
--- ---
COSTS AND EXPENSES
Lease operating 6 10
General and administrative 15 19
Depletion 8 12
Professional services and other 2 2
Litigation settlement 1
--- ---
Total 31 44
--- ---
NET INCOME $ 18 $ 44
======== ========
ALLOCATION OF NET INCOME:
General Partner $ 9 $ 24
========= ========
Limited Partner $ 9 $ 20
========= ========
Per initial $1,000 limited
partner investment $ 1.91 $ 4.24
======= =======
Weighted average initial $1,000 limited
partner investment units outstanding 4,713 4,713
===== =====
<FN>
The accompanying note is an integral part
of the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MAY LIMITED PARTNERSHIP 1983-1
STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Six Months Ended June 30,
1997 1996
----- ----
REVENUES
<S> <C> <C>
Oil revenue $ 14 $ 20
Gas revenue 110 167
Interest 3 2
---- ----
Total 127 189
--- ---
COSTS AND EXPENSES
Lease operating 14 20
General and administrative 30 38
Depletion 17 23
Professional services and other 6 4
Litigation settlement 1
--- ---
Total 67 86
--- ---
NET INCOME $ 60 $ 103
======== ========
ALLOCATION OF NET INCOME:
General Partner $ 32 $ 51
======== ========
Limited Partner $ 28 $ 52
======== ========
Per initial $1,000 limited
partner investment $ 5.94 $ 11.03
======= ======
Weighted average initial $1,000 limited
partner investment units outstanding 4,713 4,713
===== =====
<FN>
The accompanying note is an integral part
of the financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MAY LIMITED PARTNERSHIP 1983-1
STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
For the Six Months Ended June 30,
1997 1996
----- ----
OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 60 $ 103
Adjustment to reconcile net income to net
cash provided by operating activities:
Depletion 17 23
--- ---
Cash from operations before working
capital changes 77 126
Changes in assets and liabilities provided (used) cash:
Accrued oil and gas sales 28 (2)
Due from affiliate (6) (13)
Accounts payable and accrued liabilities (7) (9)
Payable to affiliate (5)
---- ---
Net cash provided by operating activities 87 102
---- ---
INVESTING ACTIVITIES:
Additions to oil and gas properties (11) (1)
---- ---
FINANCING ACTIVITIES:
Distributions to partners (101)
---- ----
NET INCREASE IN CASH AND CASH
EQUIVALENTS 76
CASH AND CASH EQUIVALENTS:
Balance, beginning of period 115 115
--- ---
Balance, end of period $ 191 $ 115
======= =======
<FN>
The accompanying note is an integral part
of the financial statements.
</FN>
</TABLE>
<PAGE>
MAY LIMITED PARTNERSHIP 1983-1
NOTE TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - GENERAL
The financial statements presented are those of May Limited Partnership 1983-1
(the "Partnership"). The interim financial data are unaudited; however, in the
opinion of the general partner, the interim data include all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of the results for the interim periods. These financial statements
should be read in conjunction with the financial statements and notes thereto
included in the Partnership's December 31, 1996 Annual Report on Form 10-K.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Liquidity and Capital Resources
The Partnership generated $87,000 of cash flow from operating activities during
the six months ended June 30, 1997. A distribution payable to partners of record
as of June 30, 1997 was declared in July 1997. The distribution amount is
$100,000, payable $58,000 to May Drilling Partnership 1983-1 partners and
$42,000 to the general partner. The ability of the Partnership to make future
distributions is dependent on future prices for the Partnership's production and
the production level of the Partnership's remaining oil and gas reserves.
Results of Operations
Second Quarter 1997 Compared to Second Quarter 1996
Oil Revenue
Oil revenue decreased $5,000 during the second quarter of 1997 as compared with
the same period during 1996 primarily due to a decrease in production combined
with a decrease in the average oil price. The average oil price decreased from
$20.84 per barrel in 1996 to $19.78 per barrel in 1997. Oil production decreased
40% primarily due to the temporary shut-in of two wells during May and June of
1997 while workover procedures were performed.
Gas Revenue
Gas revenue decreased $35,000 during the second quarter of 1997 as compared to
the corresponding period in 1996 primarily as the result of a decrease in
production combined with a decrease in price. Gas production decreased 37% due
to the temporary shut-in of two wells during May and June of 1997 while workover
procedures were performed. The average gas price decreased from $2.64 per mcf in
1996 to $2.26 per mcf in 1997.
Interest
Interest income increased $1,000 during the second quarter of 1997 as
compared with the second quarter of 1996 due to a higher average balance.
Lease Operating
Lease operating expense decreased $4,000 during the second quarter of 1997 as
compared with the second quarter of 1996 primarily due to lower production taxes
resulting from the decrease in oil and gas revenue discussed above.
<PAGE>
General and Administrative
General and administrative expenses decreased $4,000 during the second quarter
of 1997 as compared with the same period in 1996 due to a decrease in the
allocation of overhead from the general partner.
Depletion
Depletion expense decreased $4,000 during the second quarter of 1997 as compared
to the corresponding period in 1996 as a result of a lower depletion rate during
1997 resulting from the decrease in oil and gas production discussed above.
Litigation Settlement
Litigation settlement expense during the second quarter of 1996 represents the
expense associated with the settlement of a property related lawsuit.
Six Months Ended June 30, 1997 Compared to the Six Months Ended June 30, 1996
The comparisons for the six months ended June 30, 1997 and the six months ended
June 30, 1996 are consistent with those discussed in the second quarter 1997
compared to the second quarter of 1996 except for the following:
Oil Revenue
Oil revenue decreased $6,000 during the first six months of 1997 as compared to
the corresponding period in 1996 primarily due to a decrease in production,
partially offset by an increase in the average oil price. The average oil price
increased from $19.94 per barrel in 1996 to $21.34 per barrel in 1997. Oil
production decreased 31% primarily due to the temporary shut-in of two wells
during May and June of 1997 while workover procedures were performed.
Gas Revenue
Gas revenue decreased $57,000 during the first six months of 1997 as compared to
the corresponding period in 1996 primarily as the result of a decrease in
production combined with a decrease in price. Gas production decreased 30%
primarily due to the temporary shut-in of two wells during May and June of 1997
while workover procedures were performed. The average gas price decreased from
$2.95 per mcf in 1996 to $2.76 per mcf in 1997.
Professional Services and Other
Professional services and other expense increased $2,000 during the first six
months of 1997 as compared with the first six months of 1996. The increase is
primarily due to the timing of these expenses.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
Reference is made to Item 8 - Note 4 of Form 10-K for the year
ended December 31, 1996.
ITEM 2 - CHANGES IN SECURITIES
None.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5 - OTHER INFORMATION
None.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
None.
<PAGE>
-10-
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Partnerships have duly caused this report to be signed on their behalf by the
undersigned, thereunto duly authorized.
MAY DRILLING PARTNERSHIP 1983-1
MAY LIMITED PARTNERSHIP 1983-1
By: EDP OPERATING, LTD.,
General Partner
By: HEPGP LTD.,
General Partner
By: HALLWOOD G. P., INC.,
General Partner
Date: August 11, 1997 By: Robert S. Pfeiffer
------------------------- ------------------
Robert S. Pfeiffer, Vice President
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Form 10-Q
for the quarter ended June 30, 1997 for May Limited Partnership 1983-1 and is
qualified in its entirety by reference to such Form 10-Q.
</LEGEND>
<CIK> 0000725650
<NAME> May Limited Partnership 1983-1
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-END> Jun-30-1997
<CASH> 191
<SECURITIES> 0
<RECEIVABLES> 37
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 228
<PP&E> 7,313
<DEPRECIATION> 7,080
<TOTAL-ASSETS> 461
<CURRENT-LIABILITIES> 10
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 451
<TOTAL-LIABILITY-AND-EQUITY> 461
<SALES> 124
<TOTAL-REVENUES> 127
<CGS> 0
<TOTAL-COSTS> 67
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 60
<INCOME-TAX> 0
<INCOME-CONTINUING> 60
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 60
<EPS-PRIMARY> 5.94
<EPS-DILUTED> 5.94
</TABLE>
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