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 0-89194
-----------------------
MAY DRILLING PARTNERSHIP 1984-2
MAY LIMITED PARTNERSHIP 1984-2
(Exact name of registrant as specified in its charter)
------------------------
TEXAS 75-1985009
(State or other jurisdiction of 75-1985008
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 1984-2
BALANCE SHEETS
(In thousands)
September 30, December 31,
1995 1994
------------ ------------
(Unaudited)
ASSETS
Investment in
May Limited Partnership 1984-2 $282 $297
==== ====
PARTNERS' CAPITAL
Partners' Capital $282 $297
==== ====
NOTE: The statements of operations and cash flows for May Drilling
Partnership 1984-2 are not presented because such information is
equal to the limited partner's share of such activity as presented
in the May Limited Partnership 1984-2 financial statements. The May
Drilling Partnership carries its investment in May Limited
Partnership 1984-2 on the equity method. The May Limited
Partnership 1984-2 financial statements should be read in
conjunction with these balance sheets.
MAY LIMITED PARTNERSHIP 1984-2
BALANCE SHEETS
(In thousands)
September 30, December 31,
1995 1994
------------ -----------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 299 $ 276
Accrued oil and gas sales 169 203
Due from affiliate 77 86
Contributions receivable from
general partner 26
------- -------
Total 545 591
------- -------
OIL AND GAS PROPERTIES, using the
full cost method of accounting 10,359 10,357
Less - Accumulated depletion (10,359) (10,357)
------- -------
Net oil and gas properties - -
-------- --------
TOTAL ASSETS $ 545 $ 591
======= =======
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Accounts payable and accrued $ 12 $ 14
liabilities ------- -------
Total 12 14
------- -------
PARTNERS' CAPITAL
General Partner 251 280
Limited Partner 282 297
------- -------
Total 533 577
------- -------
TOTAL LIABILITIES AND PARTNERS'
CAPITAL $ 545 $ 591
======= =======
MAY LIMITED PARTNERSHIP 1984-2
STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Three Months Ended
--------------------------
September 30, September 30,
1995 1994
--------- ---------
REVENUES
Oil revenue $ 135 $ 144
Gas revenue 155 177
Interest income 3 3
------- -------
Total 293 324
------- -------
COSTS AND EXPENSES
Lease operating 6 7
Production taxes 24 26
General and administrative 11 11
Professional services and other 2 2
-------- --------
Total 43 46
------- -------
NET INCOME $ 250 $ 278
======= =======
ALLOCATION OF NET INCOME:
General Partner $ 78 $ 87
======= =======
Limited Partner $ 172 $ 191
======= =======
Per initial $1,000 limited
partner investment $ 19.92 $ 22.12
======= =======
Weighted average initial $1,000
limited partner investment
units outstanding 8,633 8,633
======= =======
MAY LIMITED PARTNERSHIP 1984-2
STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except for unit information)
For the Nine Months Ended
-------------------------
September 30, September 30,
1995 1994
--------- ---------
REVENUES
Oil revenue $ 383 $ 421
Gas revenue 426 687
Interest income 10 6
------- -------
Total 819 1,114
------- -------
COSTS AND EXPENSES
Lease operating 21 17
Production taxes 66 71
General and administrative 33 33
Depletion 2
Professional services and other 8 9
------- -------
Total 130 130
------- -------
NET INCOME $ 689 $ 984
======= =======
ALLOCATION OF NET INCOME:
General Partner $ 219 $ 309
======= =======
Limited Partner $ 470 $ 675
======= =======
Per initial $1,000 limited
partner investment $ 54.44 $ 78.19
======= =======
Weighted average initial $1,000
limited partner investment
units outstanding 8,633 8,633
======= =======
MAY LIMITED PARTNERSHIP 1984-2
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 $ 689 $ 984
Adjustment to reconcile net income
to net cash provided by
operating activities:
Depletion 2
-------- --------
Cash from operations before working
capital changes 691 984
Changes in assets and liabilities
provided (used) cash:
Accrued oil and gas sales 34 125
Due from affiliate 9 (50)
Contributions receivable from
general partner 26
Accounts payable and accrued
liabilities (2) (2)
------- -------
Net cash provided by operating
activities 758 1,057
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to oil and gas properties (2)
------- --------
Net cash used in investing activities
(2)
------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners (733) (1,087)
Contributions from general partner 23
------- -------
Net cash used in financing activities (733) (1,064)
------- -------
Net increase (decrease) in cash and
cash equivalents 23 (7)
CASH AND CASH EQUIVALENTS:
Balance, beginning of period 276 240
------- -------
Balance, end of period $ 299 $ 233
======= =======
The accompanying notes are an integral part
of the financial statements.
MAY LIMITED PARTNERSHIP 1984-2
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - GENERAL
The financial statements presented are those of May Limited Partnership 1984-2
(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 $758,000 for the nine months ended
September 30, 1995, and $733,000 was distributed to partners. A distribution
was declared in October 1995. The distribution amount is $279,000, payable
$191,000 to May Drilling Partnership 1984-2 partners and $88,000 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 THE THIRD QUARTER 1994
OIL REVENUES
Oil revenues decreased $9,000 during the third quarter of 1995 as compared to
the corresponding period in 1994 as the result of an 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 increased from $17.56 per barrel in 1994 to
$17.01 per barrel in 1995.
GAS REVENUES
Gas revenues decreased $22,000 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. Gas production decreased 2% on the Freddie Aker
#1 due to a decrease in the state allowable production limits. The average gas
price decreased from $1.97 per mcf in 1994 to $1.77 per mcf in 1995.
LEASE OPERATING EXPENSE
Lease operating expense decreased $1,000 for the third quarter of 1995 as
compared to the corresponding period in 1994 due to decreased maintenance
activity.
PRODUCTION TAXES
Production taxes decreased $2,000 during the third quarter of 1995 as compared
to the corresponding period in 1994 due to decreased oil and gas production as
previously discussed.
NINE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED TO THE 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 as follows:<PAGE>
OIL REVENUE
Oil revenue decreased $38,000 during the first nine months of 1995 as compared
with the same period in 1994 due to an 18% decrease in oil production resulting
from reduced state allowable production limits as well as normal production
declines, partially offset by an increase in oil prices. The average oil price
increased from $15.99 per barrel in 1994 to $17.70 in 1995.
GAS REVENUE
Gas revenue decreased $261,000 during the first nine months of 1995 as compared
with the same period in 1994 due to a 20% decrease in production resulting from
reduced state allowable production limits as well as normal production declines,
combined with lower gas prices. Average gas prices decreased from $2.38 per mcf
in 1994 to $1.85 per mcf in 1995.
INTEREST INCOME
Interest income increased $4,000 during the first nine months of 1995 as
compared with the same period in 1994 primarily due to higher interest rates
during 1995.
LEASE OPERATING EXPENSE
Lease operating expense increased $4,000 during the first nine months of 1995 as
compared with the same period in 1994 due to increased maintenance activity on
the Freddie Aker #1 well.
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 1984-2
MAY LIMITED PARTNERSHIP 1984-2
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
financial statements and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<CIK> 0000757385
<NAME> MAY LIMITED PARTNERSHIP 1984-2
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 299
<SECURITIES> 0
<RECEIVABLES> 246
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 545
<PP&E> 10,359
<DEPRECIATION> (10,359)
<TOTAL-ASSETS> 545
<CURRENT-LIABILITIES> 12
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 533
<TOTAL-LIABILITY-AND-EQUITY> 545
<SALES> 809
<TOTAL-REVENUES> 819
<CGS> 0
<TOTAL-COSTS> 130
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 689
<INCOME-TAX> 0
<INCOME-CONTINUING> 689
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 689
<EPS-PRIMARY> 54.44
<EPS-DILUTED> 0
</TABLE>
