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 SEPTEMBER 30, 1995
--- TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 2-89194
-----------------------
MAY DRILLING PARTNERSHIP 1984-3
MAY LIMITED PARTNERSHIP 1984-3
(Exact name of registrant as specified in its charter)
------------------------
TEXAS 75-1994687
(State or other jurisdiction of 75-1994682
incorporation or organization) (I.R.S. Employer
Identification Number)
4582 SOUTH ULSTER STREET PARKWAY
SUITE 1700
DENVER, COLORADO 80237
(Address of principal executive (Zip Code)
offices)
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 ___
MAY DRILLING PARTNERSHIP 1984-3
BALANCE SHEETS
(In thousands)
September 30, December 31,
1995 1994
------------- ------------
(Unaudited)
ASSETS
Investment in
May Limited Partnership 1984-3 $300 $318
=== ===
PARTNERS' CAPITAL
Partners' Capital $300 $318
==== ====
NOTE: The statements of operations and cash flows for May Drilling
Partnership 1984-3 are not presented because such information is
equal to the limited partner's share of such activity as presented
in the May Limited Partnership 1984-3 financial statements. The
May Drilling Partnership carries its investment in May Limited
Partnership 1984-3 on the equity method. The May Limited
Partnership 1984-3 financial statements should be read in
conjunction with these balance sheets.
MAY LIMITED PARTNERSHIP 1984-3
BALANCE SHEETS
(In thousands)
September 30, December 31,
1995 1994
------------- ------------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 329 $ 304
Accrued oil and gas sales 193 232
Due from affiliate 89 99
Contributions receivable from
general partner 29
------- -------
Total 611 664
------- -------
OIL AND GAS PROPERTIES, using the
full cost method of accounting 7,629 7,626
Less - Accumulated depletion (7,629) (7,626)
------- -------
Net oil and gas properties - -
------- -------
TOTAL ASSETS $ 611 $ 664
======= =======
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Accounts payable and accrued
liabilities $ 12 $ 14
------- ------
Total 12 14
------- ------
PARTNERS' CAPITAL
General Partner 299 332
Limited Partner 300 318
------- ------
Total 599 650
------- ------
TOTAL LIABILITIES AND PARTNERS'
CAPITAL $ 611 $ 664
====== ======
MAY LIMITED PARTNERSHIP 1984-3
STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Three Months Ended
--------------------------
September 30, September 30,
1995 1994
------------ -------------
REVENUES
Oil revenue $ 154 $ 165
Gas revenue 178 202
Interest income 3 4
------- -------
Total 335 371
------- -------
COSTS AND EXPENSES
Lease operating 7 8
Production taxes 28 29
General and administrative 10 11
Professional services and
other 2 2
------- -------
Total 47 50
------- -------
NET INCOME $ 288 $ 321
======= =======
ALLOCATION OF NET INCOME:
General Partner $ 96 $ 106
======= =======
Limited Partner $ 192 $ 215
======= =======
Per initial $1,000 limited
partner investment $ 29.10 $ 32.58
======= =======
Weighted average initial
$1,000 limited partner
investment units outstanding 6,599 6,599
======= =======
MAY LIMITED PARTNERSHIP 1984-3
STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Nine Months Ended
-------------------------
September 30, September 30,
1995 1994
------------ ------------
REVENUES
Oil revenue $ 437 $ 482
Gas revenue 488 786
Interest income 11 8
------- --------
Total 936 1,276
------- -------
COSTS AND EXPENSES
Lease operating 23 19
Production taxes 76 82
General and administrative 33 33
Depletion 3 -
Professional services and
other 7 9
-------- -------
Total 142 143
------- -------
NET INCOME $ 794 $ 1,133
======= =======
ALLOCATION OF NET INCOME:
General Partner $ 267 $ 377
======= =======
Limited Partner $ 527 $ 756
======= =======
Per initial $1,000 limited
partner investment $ 79.86 $ 114.56
======= =======
Weighted average initial
$1,000 limited
partnerinvestment units
outstanding 6,599 6,599
======= =======
MAY LIMITED PARTNERSHIP 1984-3
STATEMENTS OF CASH FLOW
(Unaudited)
(In thousands)
For the Nine Months Ended
September 30, September 30,
1995 1994
------------- ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $ 794 $ 1,133
Adjustment to reconcile net
income to net cash
provided by operating
activities:
Depletion 3
------- -------
Cash from operations before
working capital changes 797 1,133
Changes in assets and
liabilities provided (used)
cash:
Accrued oil and gas sales 39 143
Due from affiliate 10 (57)
Contributions receivable
from general partner 29
Accounts payable and
accrued liabilities (2) (2)
------- -------
Net cash provided by operating
activities 873 1,217
------- -------
CASH FLOW FROM INVESTING
ACTIVITIES
Additions to oil and gas (3)
properties ------- -------
Net cash used in investing (3)
activities ------- -------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Distributions to partners (845) (1,245)
Contributions from general
partner 26
------- -------
Net cash used in financing
activities (845) (1,219)
------- -------
Net increase (decrease) in cash
and cash equivalents 25 (2)
CASH AND CASH EQUIVALENTS:
Balance, beginning of period 304 255
------ ------
Balance, end of period $ 329 $ 253
====== ======
The accompanying notes are an integral part
of the financial statements.
MAY LIMITED PARTNERSHIP 1984-3
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - GENERAL
The financial statements presented are those of May Limited Partnership 1984-3
(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, 1994 Annual Report on Form 10-K.
NOTE 2 - LEGAL PROCEEDING
In October 1995, the parties agreed in principle to settle the lawsuit styled
Stutes v. Hallwood Petroleum, Inc. et al. The plaintiff in the lawsuit alleged
that as a result of exposure to benzene in the petroleum he was hauling from
various wells owned and operated by the Partnership and approximately 80 other
named defendants, he contracted myelogenous leukemia. The majority of the
Partnership's share of the settlement liability is covered by the Partnership's
liability insurance carriers. The Partnership's share of the amounts not
covered by insurance has not yet been determined because of the complexity of
the allocation.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
LIQUIDITY AND CAPITAL RESOURCES
Cash provided by operating activities totaled $873,000 for the nine months ended
September 30, 1995, and $845,000 was distributed to partners. A distribution
was declared in October 1995. The distribution amount is $320,000, payable
$213,000 to May Drilling Partnership 1984-3 partners and $107,000 to the general
partner. Future distributions are 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
THIRD QUARTER 1995 COMPARED TO THIRD QUARTER 1994
OIL REVENUES
Oil revenues decreased $11,000 during the third quarter 1995 as compared to the
corresponding period in 1994 as the result of a decrease in production combined
with a decrease in the average oil price. Oil production decreased 3% on the
Freddie Aker #1 due to a decrease in the state allowable production limits. The
average oil price decreased from $17.56 per barrel in 1994 to $17.01 per barrel
in 1995.
GAS REVENUES
Gas revenues decreased $24,000 for the third quarter of 1995 as compared to the
corresponding period in 1994 due to a decrease in the average gas price,
combined with a decrease in production. The average gas price decreased from
$1.97 per mcf in 1994 to $1.77 per mcf in 1995. Gas production decreased 2% on
the Freddie Aker #1 due to a decrease in the state allowable production limits.
LEASE OPERATING EXPENSE
Lease operating expense decreased $1,000 during the third quarter of 1995 as
compared to the corresponding period in 1994 due to a decrease in maintenance
costs on the Freddie Aker #1.
PRODUCTION TAXES
Production taxes decreased $1,000 during the third quarter of 1995 as compared
to the corresponding period in 1994 due a decrease in oil and gas revenue as
previously discussed.
NINE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
1994
The comparisons for the nine months ended September 30, 1995 and the nine months
ended September 30, 1994 are consistent with those discussed in the third
quarter 1995 compared to the third quarter 1994 except for the following:
OIL REVENUE
Oil revenue decreased $45,000 during the first nine months of 1995 as compared
with the same period during 1994 due to an 18% decrease in oil production due to
state allowable production limits as well, as normal production declines,
partially offset by an increase in prices. The average oil increased from
$15.99 per barrel in 1994 to $17.70 per barrel in 1995.
GAS REVENUE
Gas revenue decreased $298,000 during the first nine months of 1995 as compared
with the same period in 1994 due to a decrease in both production and price.
Gas production decreased by 20% from 1994 to 1995, and the average gas price
decreased from $2.38 per mcf in 1994 to $1.85 per mcf in 1995.
LEASE OPERATING EXPENSE
Lease operating expense increased $4,000 during the first nine months of 1995 as
compared to the corresponding period in 1994 due to increased maintenance
activity.
PROFESSIONAL SERVICES AND OTHER
Professional services and other expense decreased $2,000 during the first nine
months of 1995 as compared with the same period during 1994 due to the timing of
the payments for professional services.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
Reference is made to Item 8 - Note 3 of Form 10-K for the year ended
December 31, 1994 and Item 1 - Note 2 of this Form 10-Q.
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.
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 1984-3
MAY LIMITED PARTNERSHIP 1984-3
BY: EDP OPERATING, LTD.,
GENERAL PARTNER
BY: HALLWOOD G. P., INC.,
GENERAL PARTNER
Date: November 2, 1995 By: /s/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 the
finanacial statements and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<CIK> 0000739647
<NAME> MAY DRILLING PARTNERSHIP 1984-3
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 329
<SECURITIES> 0
<RECEIVABLES> 282
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 611
<PP&E> 7,629
<DEPRECIATION> (7,629)
<TOTAL-ASSETS> 611
<CURRENT-LIABILITIES> 12
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 599
<TOTAL-LIABILITY-AND-EQUITY> 611
<SALES> 332
<TOTAL-REVENUES> 335
<CGS> 0
<TOTAL-COSTS> 47
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 288
<INCOME-TAX> 0
<INCOME-CONTINUING> 288
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 288
<EPS-PRIMARY> 29.10
<EPS-DILUTED> 0
</TABLE>
