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 September 30, 1996
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 0-14252
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
(Exact name of small business issuer as specified in its charter)
Texas 76-0098592
(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)
Registrant'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
Transitional Small Business Disclosure Format (Check one):
Yes No x
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM II - 5, L.P.
BALANCE SHEET
- ------------------------------------------------------------------------------
September 30,
ASSETS 1996
-----------------
(Unaudited)
CURRENT ASSETS:
<S> <C>
Cash $ 42,798
Accounts receivable - oil & gas sales 13,028
Other current assets 508
---------------
Total current assets 56,334
---------------
OIL & GAS PROPERTIES
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities 4,120,286
Less accumulated depreciation and depletion 4,049,697
---------------
Property, net 70,589
---------------
TOTAL $ 126,923
===============
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $ 13,378
Payable to general partner 2,729
---------------
Total current liabilities 16,107
---------------
PARTNERS' CAPITAL:
Limited partners 107,998
General partner 2,818
---------------
Total partners' capital 110,816
---------------
TOTAL $ 126,923
===============
Number of $500 Limited Partner units outstanding 12,352
</TABLE>
See accompanying notes to financial statements.
- -----------------------------------------------------------------------------
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<PAGE>
<TABLE>
<CAPTION>
\NEX OIL & GAS INCOME PROGRAM II - 5, L.P.
STATEMENTS OF OPERATIONS
- ----------------------------------------------------------------------------------------------------------------
(UNAUDITED) QUARTER ENDED NINE MONTHS ENDED
------------------------------------- ----------------------------------------
September 30, September 30, September 30, September 30,
1996 1995 1996 1995
---------------- ----------------- ----------------- -------------------
REVENUES:
<S> <C> <C> <C> <C>
Oil and gas sales $ (2,950) $ 16,206 $ 24,265 $ 50,363
---------------- ----------------- ----------------- -------------------
EXPENSES:
Depreciation and depletion (241) 4,629 4,843 14,113
Lease operating expenses 2,136 4,221 7,898 16,105
Production taxes (197) 984 1,485 2,820
General and administrative 4,872 4,707 21,031 12,821
---------------- ----------------- ----------------- -------------------
Total expenses 6,570 14,541 35,257 45,859
---------------- ----------------- ----------------- -------------------
INCOME (LOSS) FROM OPERATIONS (9,520) 1,665 (10,992) 4,504
---------------- ----------------- ----------------- -------------------
OTHER INCOME:
Gain from sale of property - - 35,486 -
---------------- ----------------- ----------------- -------------------
NET INCOME (LOSS) $ (9,520) $ 1,665 $ 24,494 $ 4,504
================ ================= ================= ===================
</TABLE>
See accompanying notes to financial statements.
- -------------------------------------------------------
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<PAGE>
<TABLE>
<CAPTION>
ENEX OIL AND GAS INCOME PROGRAM II - 5, L.P.
STATEMENTS OF CASH FLOWS
- -----------------------------------------------------------------------------------------------
(UNAUDITED)
NINE MONTHS ENDED
------------------------------------------
September 30, September 30,
1996 1995
------------------- -------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 24,494 $ 4,504
------------------- -------------------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and depletion 4,843 14,113
Gain on sale of property (35,486) -
(Increase) decrease in:
Accounts receivable - oil & gas sales 5,471 (10,771)
Other current assets (18) -
(Decrease) in:
Accounts payable 0 (2,759)
Payable to general partner 1,780 (2,537)
------------------- -------------------
Total adjustments (23,410) (1,954)
------------------- -------------------
Net cash provided by operating activities 1,084 2,550
------------------- -------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property (additions) credits - development costs 177 (203)
Proceeds from sale of property 35,486
------------------- -------------------
Net cash provided (used) by investing activities 35,663 (203)
------------------- -------------------
NET INCREASE IN CASH 36,747 2,347
CASH AT BEGINNING OF YEAR 6,051 687
------------------- -------------------
CASH AT END OF PERIOD $ 42,798 $ 3,034
=================== ===================
</TABLE>
See accompanying notes to financial statements.
- ------------------------------------------------------------------------------
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<PAGE>
ENEX OIL & GAS INCOME PROGRAM II - 5, 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. In May, 1996, the limited partners of the Company voted to liquidate
the Company upon the sale of its remaining oil and gas properties. The
pending sale of the Hanson acquisition was not consummated due to
funding problems experienced by the potential buyer. The General
Partner of the Company sought a suitable buyer of all of the Company's
properties during 1996. In November 1996, the Company's final property
was sold. Final distributions will be made to the limited partners in
the near future.
3. Effective May 1, 1996, the Company sold its interests in the Newport
acquisition for $35,486. A gain of $35,486 was recognized on the sale.
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<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
Third Quarter 1995 Compared to Third Quarter 1996
Oil and gas sales for the third quarter decreased to a negative $2,950 in 1996
from $16,206 in 1995. This represents a decrease of $19,156 (118%). Oil sales
decreased by $8,910 or 110%. Gas sales decreased by $10,246 or 126%. The
negative oil and gas sales for the third quarter were primarily due to an over
accrual for the second quarter of 1996, for properties that were sold during the
third quarter but the sale was made effective May 1, 1996.
Lease operating expenses for the third quarter decreased to $2,136 in 1996 from
$4,221 in 1995. The decrease of $2,085 (49%) is primarily due to the changes in
production, noted above.
Depreciation and depletion expense decreased to negative $241 in the third
quarter of 1996 from $4,629 in the third quarter of 1995. This represents a
decrease of $4,870 (105%). As noted above, an over accrual for the second
quarter of 1996 decreased production volumes and the corresponding depletion
expense.
In August 1996, but effective May 1, 1996, the Company sold its interests in the
Newport acquisition for $35,486. A gain of $35,486 was recognized on the sale.
General and administrative expenses for the third quarter increased to $4,872 in
1996 from $4,707 in 1995. This increase of $165 is primarily due to more staff
time being required to manage the Company's operations.
First Nine Months in 1995 Compared to First Nine Months in 1996
Oil and gas sales for the first nine months decreased to $24,265 in 1996 from
$50,363 in 1995. This represents a decrease of $26,098 (52%). Oil sales
decreased by $21,767 or 65%. A 70% decrease in oil production decreased sales by
$23,403. This decrease was partially offset by a 3% increase in the average oil
sales price. Gas sales decreased by $4,331 or 25%. A 70% decrease in gas
production, reduced gas sales by $8,378. This was partially offset by a 47%
increase in the average gas sales price. The production decreases were primarily
the result of the sale of the Newport acquisition effective May 1, 1996. The
changes in average sales prices correspond with changes in the overall market
for the sale of oil and gas.
Lease operating expenses decreased to $7,898 in 1996 from $16,105 in 1995. The
decrease of $8,207 (51%) is primarily due to the changes in production, noted
above.
Depreciation and depletion expense decreased to $4,843 in the first nine months
of 1996 from $14,113 in the first nine months of 1995. This represents a
decrease of $9,270 (66%). The changes in production, noted above, reduced
depreciation and depletion expense by $8,458. A
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<PAGE>
14% decrease in the depletion rate reduced depreciation and depletion expense by
an additional $812. The rate decrease was primarily a result of upward revisions
of the oil and gas reserves during December 1995.
Effective May 1, 1996, the Company sold its interests in the Newport acquisition
for $35,486. A gain of $35,486 was recognized on the sale.
General and administrative expenses in the first nine months increased to
$21,031 in 1996 from $12,821 in 1995. This increase of $8,210 is primarily due
to more staff time being required to manage the Company's operations.
CAPITAL RESOURCES AND LIQUIDITY
The Company's cash flow from operations is a direct result of the amount and net
proceeds realized from the sale of oil and gas production. Accordingly, the
changes in cash flow from 1995 to 1996 and primarily due to the changes in oil
and gas sales described above.
In May, 1996, the limited partners of the Company voted to liquidate the Company
upon the sale of its remaining oil and gas properties. The pending sale of the
Hanson acquisition was not consummated due to funding problems experienced by
the potential buyer. The General Partner of the Company sought a suitable buyer
of all of the Company's properties during 1996. In November 1996, the Company's
final property was sold. Final distributions will be made to the limited
partners in the near future.
As of September 30, 1996, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
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<PAGE>
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 September 30, 1996.
II-1
<PAGE>
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 - 5, 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
November 13, 1996 By: /s/ James A. Klein
-------------------
James A. Klein
Controller and Chief
Accounting Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<CIK> 0000769501
<NAME> Enex Oil & Gas Income Program II- 5, L.P.
<S> <C>
<PERIOD-TYPE> 9-mos
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-START> jan-01-1996
<PERIOD-END> sep-30-1996
<CASH> 42798
<SECURITIES> 0
<RECEIVABLES> 13028
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 56334
<PP&E> 4120286
<DEPRECIATION> 4049697
<TOTAL-ASSETS> 126923
<CURRENT-LIABILITIES> 16107
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 110816
<TOTAL-LIABILITY-AND-EQUITY> 126923
<SALES> 24265
<TOTAL-REVENUES> 24265
<CGS> 9383
<TOTAL-COSTS> 35257
<OTHER-EXPENSES> 25874
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24494
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
