SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/X/ Quarterly Report Pursuant to Section 13 or 15(d)of the Securities
Exchange Act of 1934
For the Quarterly Period Ended June 30, 1995
or
/ / Transition Report Pursuant to Section 13 or 15(d)of the Securities
Exchange Act of 1934
For the Transition Period Ended ________________________
Commission File Number 2-91966-01
STERLING DRILLING FUND 1984-2
(Exact name of registrant as specified in charter)
New York
(State or other jurisdiction of incorporation)
13-3234372
(IRS employer identification number)
One Landmark Square, Stamford, Connecticut 06901
(Address and Zip Code of principal executive offices)
(203) 358-5700
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last
report)
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 / /
PART I
Item 1. Financial Statements
The following Financial Statements are filed herewith:
Balance Sheets - June 30, 1995 and December 31, 1994.
Statements of Operations for the Six and Three Months Ended June 30,
1995 and 1994.
Statements of Changes in Partners' Equity for the Six and Three Months
Ended June 30, 1995 and 1994.
Statements of Cash Flows for the Six Months Ended June 30, 1995 and
1994.
Note to Financial Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
1. Liquidity -
The oil and gas industry is intensely competitive in all its
phases. There is also competition between this industry and
other industries in supplying energy and fuel requirements of
industrial and residential consumers. It is not possible for the
Registrant to calculate its position in the industry, as
Registrant competes with many other companies having
substantially greater financial and other resources. In
accordance with the terms of the Prospectus as filed by the
Registrant, the General Partners of the Registrant will make cash
distributions of as much of the Partnership cash credited to the
capital accounts of the Partners as the General Partners have
determined is not necessary or desirable for the payment of
contingent debts, liabilities or expenses for the conduct of the
Partnership's business.
As of June 30, 1995, the General Partners have distributed
$554,528 or 8.60% of original Limited Partner capital
contributions to the Limited Partners. The posssible shut-in of
the Registrant's wells due to normal maintenance combined with
the current level of wellhead prices may have an adverse impact
on the cash available for distribution to the Limited Partners.
The net proved oil and gas reserves of the Partnership are
considered to be a primary indicator of financial strength and
future liquidity. The present value of unescalated estimated
future net revenues (S.E.C. case) associated with such reserves,
discounted at 10% as of December 31, 1994 was approximately
$144,000.
2. Capital Resources -
The Registrant was formed for the sole intention of drilling oil
and gas wells. The Registrant entered into a drilling contract
with an independent contractor in December 1984 for $5,400,000.
Pursuant to the terms of this contract, twenty wells have been
drilled, resulting in twenty producing wells.
3. Results of Operations -
Total operating revenues decreased from $73,494 in 1994 to
$62,157 in 1995. The Registrant produced 17,729 MCF and 1,038
Bbls in 1995 and 18,714 MCF and 1,151 BBls in 1994. Oil
production declines combined with a minor increase in price per
barrel, approxiametly $13.68 per barrel in 1994 to $14,52 per
barrel in 1995, resulted in only a very slight change in overall
oil reveue The price decrease for gas from $3.07 per Mcf in 1994
to $2.48 in 1995 combuined with lower gas production resulted in
lower overall gas revenue. The partnership is currently selling,
at spot market prices, to our normal purchasers until the
partnership can lock into a contract with a favorable price.
Production expenses decreased from $44,364 in 1994 to $30,291 in
1995. Lower production expenses can be attributed to a milder
winter in 1995 and to lower production.
General and administrative expenses have been segregated on the
financial statements to show expenses attributable to the affairs
and operations of the Registrant payable to PrimeEnergy
Management Corporation, a general partner. These expenses are
charged in accordance with guidelines set forth in the
Registrant's Management Agreement and shall not exceed an annual
amount of 5% of limited partners capital contributed. Amounts
related to both 1995 and 1994 are substantially less than the
amounts allocable to the Reegistrant under the Partnership
Agreement. The lower amounts reflect mananagement's effort's to
limit costs, both incurred and allocated to the Registrant.
Management continutes to reduce third party costs and use in-
house resources to provide efficient and timely services to the
partnership.
The partnership records additional depreciation, depletion and
amortization to the extent that net capitalized costs exceed the
undiscounted future net cash flows attributable to the
partnership properties. A downward revision in reserve esitmates
due to lower year-end gas prices in 1994 resulted in an
additional charge of $200,000. The lower depltion expense in
1995 is due to lower depletable cost basis in oil and gas
properties.
PART II
Items 1 to 5 have been omitted in that each item is either
inapplicable or the answer is negative.
Item 6 The Partnership was not required to file any reports on
Form 8-K during this period.
S I G N A T U R E S
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto
duly authorized.
STERLING DRILLING FUND 1984-2
(Registrant)
August 10, 1995 By:__________________
(Date) Charles E. Drimal, Jr.
General Partner
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Balance Sheets
(unaudited)
June 30, December 31,
1995 1994
Assets
Current Assets:
Cash and cash equivalants $ 2,054 $ 3,306
Due from others -- --
----------- -------------
Total current assets 2,054 3,306
----------- -------------
Oil and Gas properties -
successful efforts method:
Leasehold costs 225,680 225,680
Well and related facilities 5,395,739 5,395,739
less accummulated
depreciation,depletion and
amortization (5,430,344) (5,420,678)
----------- ------------
191,075 200,741
----------- -------------
Total assets $ 193,129 $ 204,047
=========== =============
Liabilities and Partners'
Equity
Current liabilities:
Due to affiliates $ 84,431 $ 73,950
----------- ------------
Total current liabilities 84,431 73,950
----------- ------------
Partners' Equity
Limited partners 162,253 180,616
General partners (53,555) (50,519)
----------- ------------
Total partners' equity 108,698 130,097
----------- ------------
Total liabilities and
partners' equity $ 193,129 $ 204,047
=========== ============
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Operations
(unaudited)
Six Months Ending
June 30, 1995
Limited General
Partners Partners Total
Revenue:
Operating revenue $ 49,104 $ 13,053 $ 62,157
Interest income 180 12 192
-------- -------- ---------
Total Revenue 49,284 13,065 62,349
-------- -------- ---------
Costs and Expenses:
Production expense 23,930 6,361 30,291
General and administrative
to a related party 9,873 2,625 12,498
General and administrative 8,638 2,296 10,934
Depreciation, depletion
and amortization 9,086 580 9,666
-------- -------- ---------
Total Costs and Expenses 51,527 11,862 63,389
-------- -------- ---------
Net Income(loss) $ (2,243) $ 1,203 $ (1,040)
========= ======== ==========
Net Income(loss)
per equity unit $ (0.35)
==========
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Operations
(unaudited)
Six Months Ending
June 30, 1994
Limited General
Partners Partners Total
Revenue:
Operating revenue $ 58,060 $ 15,434 $ 73,494
Interest income 97 6 103
-------- -------- ---------
Total Revenue 58,157 15,440 73,597
-------- -------- ---------
Costs and Expenses:
Production expense 35,048 9,316 44,364
General and administrative 12,798 3,402 16,200
to a related party
General and administrative 7,307 1,942 9,249
Depreciation, depletion
and amortization 12,088 772 12,860
-------- ------- ---------
Total Costs and Expenses 67,241 15,432 82,673
-------- ------- ---------
Net Income(loss) $ (9,084) $ 8 $ (9,076)
========= ======== ==========
Net Income(loss)
per equity unit $ (1.41)
=========
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Operations
(unaudited)
Three Months Ending
June 30, 1995
Limited General
Partners Partners Total
Revenue:
Operating revenue $ 19,635 $ 5,220 $ 24,855
Interest income 64 5 69
-------- -------- ---------
Total Revenue 19,699 5,225 24,924
-------- -------- ---------
Costs and Expenses:
Production expense 12,230 3,251 15,481
General and administrative
to a related party 4,936 1,313 6,249
General and administrative 5,694 1,513 7,207
Depreciation, depletion
and amortization 4,543 290 4,833
-------- -------- ---------
Total Costs and Expenses 27,403 6,367 33,770
-------- -------- ---------
Net Income(loss) $ (7,704) $ (1,142) $ (8,846)
========= ======== =========
Net Income(loss)
per equity unit $ (1.19)
=========
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Operations
(unaudited)
Three Months Ending
June 30, 1994
Limited General
Partners Partners Total
Revenue:
Operating revenue $ 28,765 $ 7,647 $ 36,412
Interest income 63 4 67
-------- -------- -----------
Total Revenue 28,828 7,651 36,479
-------- -------- -----------
Costs and Expenses:
Production expense 18,322 4,870 23,192
General and administrative 6,399 1,701 8,100
to a related party
General and administrative 4,655 1,237 5,892
Depreciation, depletion 6,044 386 6,430
and amortization
-------- -------- -----------
Total Costs and Expenses 35,420 8,194 43,614
-------- -------- -----------
Net Income(loss) $ (6,592) $ (543) $ (7,135)
======== ======== ===========
Net Income(loss)
per equity unit $ (1.02)
==========
see accompanying note to financials
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Changes in Partners' Equity
(unaudited)
Six Months Ended
June 30, 1995
Limited General
Partners Partners Total
Balance at beginning of
period $ 180,616 $ (50,519) $ 130,097
Partners' Contribution -- -- --
Cash Distributions (16,120) (4,239) (20,359)
Net Income(Loss) (2,243) (1,203) (1,040)
-------- -------- ---------
Balance at end of period 162,253 (53,555) 108,698
======== ======== =========
Six Months Ended
June 30, 1994
Limited General
Partners Partners Total
Balance at beginning of
period $ 426,323 $ (31,398) $ 394,925
Cash Distributions (16,120) (4,257) (20,377)
Net Income(Loss) (9,084) 8 (9,076)
-------- -------- ---------
Balance at end of period 401,119 (35,647) 365,472
======== ======== =========
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Changes in Partners' Equity
(unaudited)
Three Months Ended
June 30, 1995
Limited General
Partners Partners Total
Balance at beginning of
period $ 186,077 $ (48,174) $ 137,903
Cash Distributions (16,120) (4,239) (20,359)
Net Income(Loss) (7,704) (1,142) (8,846)
-------- -------- ----------
Balance at end of period 162,253 (53,555) 108,698
======== ======== ==========
Three Months Ended
June 30, 1994
Limited General
Partners Partners Total
Balance at beginning of
period $ 423,831 $ (30,847) $ 392,984
Cash Distributions (16,120) (4,257) (20,377)
Net Income(Loss) (6,592) (543) (7,135)
--------- -------- -----------
Balance at end of period $ 401,119 $ (35,647) $ 365,472
========= ======== ===========
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York Limited Partnership)
Statement of Cash Flows
(unaudited)
Six months Six months
ended ended
June 30, June 30,
1995 1994
Net cash provided by operating $ 19,107 $ 6,523
activities
------------ ------------
Cash flows from financing
activities:
Partners' contributions -- 113
Distribution to partners (20,359) (20,360)
------------ ------------
Net cash used in financing
activities (20,359) (20,247)
------------ ------------
Net increase(decrease) in cash and
cash equivalents (1,252) (13,724)
Cash and cash equivalents at
beginning of period 3,306 16,393
------------ ------------
Cash and cash equivalents at end of
period $ 2,054 $ 2,669
============ ============
See accompanying note to financials.
STERLING DRILLING FUND 1984-2
(a New York limited partnership)
Note to Financial Statements
June 30, 1995
1. The accompanying statements for the period ending June 30,
1995 are unaudited but reflect all adjustments necessary to
present fairly the results of operations. Certain
reclassifications were made to the prior periods' financial
statements to conform to the current period presentation.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
quarterly report on Form 10Q for Sterling Drilling Fund 1984-1 and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 2054
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2054
<PP&E> 5621419
<DEPRECIATION> 5430344
<TOTAL-ASSETS> 193129
<CURRENT-LIABILITIES> 84431
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 108698<F1>
<TOTAL-LIABILITY-AND-EQUITY> 193129
<SALES> 0
<TOTAL-REVENUES> 62349
<CGS> 0
<TOTAL-COSTS> 63389
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1040)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Field Other-Se contains total partner's equity.
</FN>
</TABLE>
