United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from...............to...............
Commission file number 0-13484
ENEX OIL & GAS INCOME PROGRAM II - 1, L.P.
(Exact name of small business issuer as specified in its charter)
New Jersey 76-0098588
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 200, Three Kingwood Place
Kingwood, Texas 77339
(Address of principal executive offices)
Issuer's telephone number (713) 358-8401
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ENEX OIL & GAS INCOME PROGRAM II - 1, L.P.
BALANCE SHEET
MARCH 31,
ASSETS 1995
(Unaudited)
CURRENT ASSETS:
Cash $ 2,001
Accounts receivable - oil & gas sales 10,213
Other current assets 701
Total current assets 12,915
OIL & GAS PROPERTIES
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities 6,372,573
Less accumulated depreciation and depletion 6,103,219
Property, net 269,354
TOTAL $ 282,269
LIABILITIES AND PARTNERS' (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 568
Current portion of note payable to general partner 25,712
Payable to general partner 39,317
Total current liabilities 65,597
NOTE PAYABLE TO GENERAL PARTNER 264,553
PARTNERS' (DEFICIT):
Limited partners (30,680)
General partner (17,201)
Total partners' (deficit) (47,881)
TOTAL $ 282,269
See accompanying notes to financial statements.
I-1
ENEX OIL & GAS INCOME PROGRAM II - 1, L.P.
STATEMENTS OF OPERATIONS
(UNAUDITED) THREE MONTHS ENDED
MARCH 31, MARCH 31,
1995 1994
REVENUES:
Oil and gas sales $ 16,741 $ 16,324
EXPENSES:
Depreciation and depletion 2,460 2,617
Lease operating expenses 6,631 13,409
Production taxes 1,383 1,130
General and administrative 2,850 4,491
Total expenses 13,324 21,647
INCOME (LOSS) FROM OPERATIONS 3,417 (5,323)
OTHER EXPENSE:
Interest expense to general partner (6,712) (5,349)
NET LOSS $ (3,295) $ (10,672)
See accompanying notes to financial statements.
I-2
ENEX OIL AND GAS INCOME PROGRAM II - 1, L.P.
STATEMENTS OF CASH FLOWS
(UNAUDITED) THREE MONTHS ENDED
MARCH 31, MARCH 31,
1995 1994
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (3,295) $ (10,672)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and depletion 2,460 2,617
(Increase) decrease in:
Accounts receivable - oil & gas sales (690) 4,655
Increase (decrease) in:
Accounts payable (4,973) (1,618)
Payable to general partner 6,784 6,341
Total adjustments 3,581 11,995
Net cash provided by operating activities 286 1,323
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions - development costs (997) -
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of note payable to gen 6,712 5,349
Repayment of note payable to general partner (4,000) (4,000)
Net cash provided by financing activities 2,712 1,349
NET INCREASE IN CASH 2,001 2,672
CASH AT BEGINNING OF YEAR - 315
CASH AT END OF PERIOD $ 2,001 $ 2,987
Cash paid during the period for interest $ 6,712 $ 5,349
See accompanying notes to financial statements.
I-3
ENEX OIL & GAS INCOME PROGRAM II - 1. L.P.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
1. The interim financial information included herein is unaudited;
however, such information reflects all adjustments (consisting solely
of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of results for the
interim periods.
2. The weighted average principal outstanding on the note payable to the
general partner was $287,302 and $309,895 for the first quarter of
1995 and 1994, respectively. Outstanding principal bore interest at
a weighted average rate of 9.47% during the first quarter of 1995 and
7.00% during the first quarter of 1994. Principal payments of $4,000
were made in the first quarter of both 1994 and 1995.
Item 2. Management's Discussion and Analysis or Plan of Operation.
First Quarter 1995 Compared to First Quarter 1994
Oil and gas sales for the first quarter increased from $16,324 in 1994 to
$16,741 in 1995. This represents an increase of $417 (3%). Oil sales
increased by $1,584 or 33%. A 10% increase in production increased sales
by $495, while a 21% increase in average oil prices increased sales by an
additional $1,089. Gas sales decreased by $1,167 or 10%. A 21% decrease
in average gas prices reduced sales by $2,779. This decrease was partially
offset by a 14% increase in gas production. The changes in average prices
correspond with changes in the overall market for the sale of oil and gas.
The increased oil production was primarily due to higher production from a
recompletion of a well in the NW Esperance Point acquisition. The higher
gas production was primarily the result of a partial shut-in of gas
production from the East Seven Sisters acquisition to perform a workover in
the first quarter of 1994, partially offset by natural production declines.
Lease operating expenses decreased from $13,409 in the first quarter of
1994 to $6,631 in the first quarter of 1995. The decrease of $6,778 was
primarily due to gas compression paid by the Company in the first quarter
of 1994, which related to production in 1993, from the East Seven Sisters
acquisition. Such 1993 charges were fully paid as of March 31, 1994.
Depreciation and depletion expense decreased from $2,617 in the first
quarter of 1994 to $2,460 in the first quarter of 1995. This represents a
decrease of $157 (6%). A 17% decrease in the depletion rate reduced
depreciation and depletion expense by $500. This decrease was partially
offset by the increased production, noted above. The decrease in the
depletion rate was primarily the result of an upward revision of the
Company's oil and gas reserves at December 31, 1994.
General and administrative expenses decreased from a $4,491 in 1994 to
$2,850 in 1995. This decrease of $1,641 or 37% was primarily due to lower
direct charges incurred by the Company in 1995 as the result of a
renegotiated tax preparation fee.
CAPITAL RESOURCES AND LIQUIDITY
The Company discontinued the payment of distributions during 1990. Future
distributions are dependent upon, among other things, an increase in prices
received for oil and gas. The Company will continue to recover its
reserves and reduce its obligations in 1995. The general partner does not
intend to accelerate the repayment of the debt beyond the cash flow
provided by operating activities. Based upon current projected cash flows
from the properties, it does not appear that the Company will have
sufficient cash to pay its operating expenses, repay its debt obligations
and pay distributions.
As of March 31, 1995, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
PART II. OTHER INFORMATION
Item 1. Legal proceedings.
None
Item 2. Changes in securities.
None
Item 3. Defaults upon senior securities.
Not Applicable
Item 4. Submission of matters to a vote of security holders.
Not Applicable
Item 5. Other information.
Not Applicable
Item 6. Exhibits and reports on Form 8-K.
(a) There are no exhibits to this report.
(b) The Company filed no reports on Form 8-K during the quarter
ended
March 31, 1995.
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 hereunto duly authorized.
ENEX OIL & GAS INCOME
PROGRAM II - I, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By: /s/ R. E. Densford
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
May 11, 1995 By: /s/ James A. Klein
James A. Klein
Controller and Chief
Accounting Officer
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ENEX OIL & GAS INCOME
PROGRAM II - 1, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By:
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
May 11, 1995 By:
James A. Klein
Controller and Chief
Accounting Officer
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 2,001
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<RECEIVABLES> 10,213
<ALLOWANCES> 0
<INVENTORY> 701
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<PP&E> 6,372,573
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<OTHER-SE> (47,881)
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<CGS> 10,474
<TOTAL-COSTS> 10,474
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<INCOME-PRETAX> (3,295)
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<INCOME-CONTINUING> (3,295)
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