UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
FORELAND CORPORATION
(Exact name of registrant as specified in its charter)
Nevada 87-0422812
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
12596 W. Bayaud Avenue
Suite 300, Lakewood, Colorado 80228
(Address of principal executive offices) (Zip Code)
(303) 988-3122
(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 "
Indicate the number of shares outstanding of each of the issuer's classes
of common stock as of the latest practicable date.
As of May 13, 1996, the Company had outstanding 14,700,447 shares of its
common stock, par value $0.001 per share.
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The consolidated condensed financial statements included herein have been
prepared by Foreland Corporation (the "Company"), without audit, pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted. However, in the opinion of management, all adjustments
(which include only normal recurring accruals) necessary to present fairly the
financial position and results of operations for the periods presented have been
made. These consolidated condensed financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Company's annual report on Form 10-K for the period ended December 31, 1995.
FORELAND CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
March 31, 1996 Dec. 31, 1995
-------------- -------------
ASSETS
Current assets:
Cash and cash equivalents .......... $267,091 $ 30,490
Accounts receivable - trade......... 296,427 438,058
Inventory .......................... 58,563 81,382
Advances to officer ................ 7,128 7,212
Prepaid expenses and other ......... 31,413 2,586
----------- -----------
Total current assets .......... 660,622 559,728
Property and equipment, at cost:
Oil and gas properties,
under the successful efforts method 7,124,980 6,874,635
Other property and equipment ....... 299,374 299,161
----------- -----------
7,424,354 7,173,796
Less accumulated depreciation,
amortization, depletion,
and impairment.................. (3,054,882) (2,363,211)
----------- -----------
4,369,472 4,810,585
Other assets.......................... 437,729 230,785
----------- -----------
Total assets......................... $5,467,823 $5,601,098
============= ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $1,873,408 $1,642,537
Current maturities of long-term debt 404,381 404,237
Oil and gas sales payable .......... 111,835 125,899
Officers' salaries payable ......... 401,890 392,462
----------- ------------
Total current liabilities ..... 2,791,514 2,565,135
Long-term debt........................ 21,948 23,091
Stockholders' Equity:
Preferred Stock, $0.001 par value,
5,000,000 shares authorized.
1991 Convertible Preferred Stock,
40,000 and 40,000 shares issued
and outstanding, respectively,
liquidation preference $1.25
per share ..................... 40 40
1994 Convertible Preferred Stock,
244,640, and 433,686
shares issued and outstanding,
respectively, liquidation
preference $2.00 per share ... 245 434
1995 Convertible Preferred Stock,
1,015,334, and 1,015,334
shares issued and outstanding,
respectively, liquidation preference
$1.50 per share ............... 1,015 1,015
1996 Convertible 6% Preferred Stock,
525, and -0- shares issued and
outstanding, respectively, liquidation
preference $1,000 per share .... 1 --
Common Stock, $0.001 par value,
50,000,000 shares authorized;
14,678,477 and 14,489,401 shares
issued and outstanding,
respectively .................. 14,678 14,489
Additional paid-in capital ......... 23,774,206 23,301,858
Less note and stock subscriptions
receivable ......................... (1,113,911) (1,092,622)
Accumulated deficit ................ (20,021,913) (19,212,342)
----------- ------------
Total stockholders' equity .... 2,654,361 3,012,872
----------- ------------
Total liabilities and
stockholders' equity.................. $5,467,823 $5,601,098
========== ==========
See accompanying notes to these consolidated financial statements.
FORELAND CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months
Ended March 31,
------------------
1996 1995
-------- -------
REVENUES:
..Oil and gas sales ....................... $ 300,694 $248,977
Operator and well service sales 11,413 7,588
Other income, net .. 3,600 135
--------- ---------
Total revenues ..................... 315,707 256,700
EXPENSES:
Oil and gas production............................. 101,007 102,985
Oil and gas exploration.............................. 172,808 162,975
Well service costs................................... 166 144
Dry hole, abandonment, and impairment costs....... 443,830 94,749
General and administrative.......................... 136,474 261,259
Depreciation, depletion, and
amortization..................................... 225,931 120,336
--------- ---------
Total expenses............................... 1,080,216 742,448
--------- ---------
Net operating loss... (764,509) (485,748)
Other income (expense):
Interest income .... 28,580 31,361
Interest expense ... (73,644) (28,753)
--------- ---------
(28,753)
----------
Net loss.............. $ (809,573) $(483,140)
========== =========
NET LOSS PER COMMON SHARE .................... $ (0.06) $ (0.04)
========== =========
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING ............................... 14,669,245 13,773,583
========== ==========
See accompanying notes to these consolidated financial statements.
FORELAND CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended March 31,
----------------------------
1996 1995
--------- ----------
Cash flow from operating activities:
Net loss .............................. $(809,573) $(483,140)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation, depletion, and amortization 225,931 120,336
Dry hole, abandonment and impairment costs443,830 94,749
Issuance of stock for services ........ -- 82,188
Accrued note receivable interest income.. (24,888) (31,256)
Amortization of loan origination fee .. 18,438 10,937
Changes in operating assets and liabilities:
(Increase) decrease in:
Accounts receivable .............. 141,631 599,971
Advances to officer ................... 84 339
Inventory ........................ 22,818 (12,933)
Prepaids and other .................... (55,903) 197
Increase (decrease) in:
Accounts payable ................. 216,807 18,757
Salaries payable ................. 9,429 8,516
-------- -------
Net cash provided by operating
activities..................... 188,604 408,661
Cash flows from investing activities:
Proceeds from sale of marketable
securities.......................... 1,695 -
Purchase of marketable securities ..... (200,000) -
Additions to oil and gas properties ... (228,437) (149,486)
Purchase of other property ............ (212) 5,180
--------- -------
Net cash (used in) provided
by investing activities........ (426,954) (144,306)
Cash flows from financing activities:
Proceeds from sale of stock, net ...... 472,350 95,021
Receipt of note receivable for stock .. 3,600 --
Repayment of long-term debt ........... (999) --
--------- -------
Net cash provided by
financing activities........... 474,951 95,021
-------- -------
Increase (decrease) in cash and
cash equivalents.................... 236,601 359,376
Cash and cash equivalents,
beginning of period ................... 30,490 93,715
-------- -------
Cash and cash equivalents, end of period. $267,091 $453,091
======== ========
Supplemental disclosures of cash flow information:
Cash paid for interest ................ $ 57,321 $17,816
======== =======
See accompanying notes to these consolidated financial statements.
FORELAND CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. OIL AND GAS PROPERTIES:
With the Company's continuous leasing program since 1986, it has
established what management believes is one of the best property positions in
Nevada. The Company's leasing programs is coordinated with prospect generation
and explorations results. As areas of interest are identified, the Company
attempts to acquire leases or other exploration rights on what preliminarily
appears to be the most promising prospect areas in order to establish a
preemptive lease position prior to generating a specific drilling prospect. As
specific prospect evaluation advances, the Company may seek leases on additional
areas or relinquish leases on areas that appear less promising, thereby reducing
leasehold cost. The Company currently has approximately 209,000 gross acres
under lease in addition to the exclusive rights to develop and market prospects
on approximately 434,000 gross acres of mineral lands owned by Parker and
Parsley.
2. ISSUANCE OF SECURITIES, COMMON STOCK OPTIONS, AND PURCHASE WARRANTS:
During the first quarter of 1996, the stockholders of 189,046 shares of the
1994 Preferred Stock converted this Preferred Stock to the same number of shares
of common stock of the Company ("Common Stock"). The conversion of these
shares, together with previously converted shares through December 31, 1995,
reduced the number of shares of 1994 Preferred Stock issued and outstanding from
1,242,210 originally issued to 244,640 as of March 31, 1996.
In March 1996, the Company issued 500 shares of 1996 Series 6% Convertible
Preferred Stock ("1996 Preferred Stock) for net proceeds of $472,500. At any
time between 60 days from issuance through March 31, 1998, at the election of
the holder, each share of 1996 Preferred Stock may be converted into that number
of shares of Common Stock as determined by dividing $1,000 plus all accrued but
unpaid dividends on such a share by the lesser of (i) $1.50 or, (ii) 75% of the
closing bid price of the common stock as reported by the Nasdaq Small CapSM
Market ("Nasdaq") for the trading date immediately preceding the date of
conversion. The 1996 Preferred Stock has a liquidation preference of $1,000 per
share. Under certain conditions, this stock may be redeemed after April 1, 1997
at a price equal to 133% of the original issue price. Holders of 1996 Preferred
Stock are entitled to receive a cumulative 6% per annum dividend payable in cash
in the event the 1996 Preferred Stock is redeemed or in shares of Common Stock
if the 1996 Preferred Stock is converted. The Placement Agent for this offering
received 25 shares of 1996 Preferred Stock and warrants to purchase 54,700
shares of Common Stock at an exercise price of $1.50 per share, subject to
adjustment in certain circumstances, based on the market price of the Common
Stock at the time of exercise.
3. NOTE PAYABLE:
On April 30, 1994, the Company borrowed $400,000 from an unrelated third
party to provide interim financing to proceed with the Company's drilling
program in its Eagle Springs Field and to pay ongoing general and administrative
expenses. In connection with the loan, the Company granted the lender warrants
to purchase 200,000 shares of Common Stock at $2.00 per share at any time prior
to the earlier of April 30, 1996 or 60 days subsequent to the repayment of the
loan. The loan originally provided for interest at 8.4% per annum, payable
quarterly, and was due on April 30, 1995.
In May 1995, the Company negotiated the extension of the due date of this
loan to April 30, 1996, and in connection with such extension, the interest rate
was increased to 10%, the Company reduced the exercise price of the warrants
previously granted to $1.50 per share, and the Company granted new warrants to
purchase Common Stock at $2.00 per share through the earlier of April 30, 1997,
or 60 days subsequent to the repayment of the loan.
The loan is collateralized by substantially all of the Company's property,
equipment, receivables and inventory. The credit agreement contains certain
covenants, including those that prohibit the Company from selling substantially
all of its assets and incurring additional collateralized indebtedness in excess
of $50,000. Subsequent to March 31, 1996, the Company paid all principal and
interest to the holder of the indebtedness (see Subsequent Events).
4. RELATED PARTY TRANSACTIONS:
The Company owed $402,335 in salaries and interest to its officers and
directors at March 31, 1996. The Company also had outstanding loans to a
present and a former officer in the amount of $229,582 as of such date.
In June 1991, the Company loaned an officer and director, and a former
officer and director, an aggregate of $124,321, repayable with interest at the
prime rate and collateralized by a pledge of the obligation of the Company to
such persons for the accrued but unpaid back salaries of approximately $156,720.
A portion of the proceeds from these loans was used to purchase $100,000 in
preferred stock and warrants and pay $23,421 in interest and principal on the
notes due a Company subsidiary on the purchase from it of the Company's common
stock. The notes were originally due in June 1992, but the Company has agreed
not to seek payment of $253,691 (including additional advances and accrued
interest) of the notes until back salaries owed these individuals (totaling
$265,158 at March 31, 1996) are paid. At March 31, 1996, $253,691, including
accrued interest, was due under the notes (which are included as a reduction of
stockholders equity in the accompanying financial statements).
During 1994, outstanding options were exercised to purchase Common Stock as
follows: Grant Steele, 200,000 shares as $1.50; N. Thomas Steele, 200,000
shares at $1.50; Kenneth L. Ransom, 200,000 shares at $1.50; Bruce C. Decker,
25,000 shares at $2.25; and Dennis J. Gustafson, 25,000 shares at $2.25.
Pursuant to the terms of the options exercised, each optionee paid the purchase
price of the options by the delivery of a promissory note payable in three
equal, consecutive installments of principal plus interest on the unpaid balance
at 7% per annum, payable annually commencing on the first anniversary of the
exercise. The note installments are payable in cash or the delivery of Common
Stock or other options valued at the trading price at the time of payment. In
connection with the issuance of shares on the exercise of such options, Grant
Steele, N. Thomas Steele, and Kenneth L. Ransom each returned 24,118 shares, for
an aggregate of 72,354 shares, of Common Stock to satisfy withholding
obligations of the Company, as provided for in the terms of the options
exercised. Also pursuant to the terms of the options exercised, the Company
automatically granted new five year options to purchase Common Stock at $2.125,
the market price for the Common Stock at the time of exercise, as follows:
Grant Steele 200,000 shares, N. Thomas Steele, 200,000 shares; Kenneth L.
Ransom, 200,000 shares; Bruce C. Decker, 25,000 shares; and Dennis J. Gustafson,
25,000 shares.
The first payment for the above referenced notes became due in September
1995. Grant Steele, N. Thomas Steele, and Kenneth Ransom each returned 50,807
shares of Common Stock in satisfaction of the first installment of principal and
interest on their $300,000 notes, while Bruce Decker and Dennis Gustafson each
returned 9,527 shares in satisfaction of the first installment of principal and
interest on their $56,250 notes.
5. INCOME TAXES:
The Company adopted the liability method of accounting for income taxes as
prescribed by Statement of Financial Accounting Standards No. 109 (SFAS 109)
effective January 1993. Financial statements of prior years have not been
restated to apply the new method retroactively. The change in accounting method
had no effect on the net loss for 1993 or prior years.
The Company has had no taxable income under federal and state tax laws due
to operating losses since its inception; therefore, no provision for income
taxes has been made. At December 31, 1995, the Company has unused net operating
loss carry-forwards of approximately $19,700,000.
6. SUBSEQUENT EVENTS:
During May 1996 the Company paid its notes due an unrelated third party
described above in "Note 3. NOTE PAYABLE."
In May 1996, holders of 22,000 shares of 1995 Series Preferred Stock
converted such shares of preferred stock into the same number of shares of
Common Stock.
In May 1996, the Company issued 1,700 shares of 1996-2 Series 6%
Convertible Preferred Stock ("1996-2 Preferred Stock") in a private placement
for net proceeds of approximately $1,640,500. Up to one-third of the 1996-2
Preferred Stock is convertible at any time after the issuance thereof, and all
of the 1996-2 Preferred Stock is automatically convertible on the date that is
six months after the date of issuance, into that number of shares of Common
Stock equal to $1,000 divided by the lesser of $0.91 or 65% of the average
closing bid price of the Common Stock as reported by Nasdaq for the five days
preceding the date of conversion. The 1996-2 Preferred stock carries a
liquidation preference of $1,000 per share. The holders of the 1996-2 Preferred
Stock are entitled to a 6% dividend payable in cash in the event the 1996-2
Preferred Stock is redeemed or in additional shares of Common Stock upon the
conversion of the 1996-2 Preferred Stock. The 1996-2 Preferred Stock is not
redeemable by the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Overview
This discussion should be read in conjunction with Management's Discussion
and Analysis of Financial Conditions and Results of Operations in the Company's
annual report on Form 10-K for the year ended December 31, 1995. Foreland
Corporation was organized in June 1985 to advance an exploration project in the
Great Basin and Range geologic province in Nevada that had been initiated by
Gulf Oil Corporation.
To date, the Company has funded its exploration program principally from
the sale of its equity securities. The Company also benefits from capital
provided by oil industry participants for drilling and other exploration of
certain oil prospects through joint arrangements typical in the oil industry.
Liquidity and Capital Resources
The Company's operations during the first three months of 1996 provided
cash of $188,600 when the Company reported a net loss of $809,600, which
resulted in part to non-cash charges against the Company's revenues, including
$225,900 in depreciation, depletion, and amortization and $443,800 in dry hole,
abandonment and impairment costs. Operating activities provided approximately
$220,100 less cash than the corresponding period in 1995.
During the first quarter of 1996, investing activities used net cash of
$427,000, principally due to $228,400 in additions to oil and gas properties and
$200,000 for the purchase of marketable securities. During the corresponding
period in 1995, investing activities used net cash of $144,300, consisting
almost entirely of cash used for additions to oil and gas properties,
The cash required for investing activities was provided by financing
activities, which provided net cash of $475,000 during the first quarter of
1996, consisting principally of $472,350 in cash proceeds received from the sale
of the Company's equity securities. During the corresponding period in 1995,
the Company received $95,000 in cash from the sale of equity securities.
Subsequent to March 31, 1996, the Company received net proceeds of
approximately $1,640,500 from the sale of its equity securities. Such proceeds
were used to repay a note payable for $400,000 borrowed from an unrelated third
party in 1994 to provide interim financing to the Company. The Company intends
to use a substantial portion of the remaining proceeds to reduce current
liabilities.
The Company requires cash for general and administrative expenses, for
maintaining its properties, and for other items that are required in order for
the Company to continue, as distinguished from costs to advance its ongoing
exploration program in Nevada.
Based on April 1996 production levels and prices, the Company estimates
that it is able to meet fixed and recurring operating costs, although the
Company requires funds from external sources to reduce its working capital
deficit. However, there can be no assurance that production levels will not
decline or that current prices for oil will not decline, in which case the
Company would require funds from external sources for operating deficiencies.
Any improved operating margins resulting from increased production and reduced
operating expenses or price increases would benefit the Company. There can be
no assurance that Eagle Springs development will result in material additional
production or that the Company will be able to obtain funds from other sources,
in which case the Company would be required to implement cost-cutting measures
and curtail drilling and most other exploration activity in order to continue.
As of March 31, 1996, the Company had a working capital deficit of
$2,130,982. After giving effect to the sale of securities subsequent to March
31, 1996, and the use of the net proceeds therefrom to repay $403,700 to repay a
note payable, , $585,900 in trade accounts payable, and the balance for certain
other expenditures, the Company had a working capital deficit of approximately
$1,000,000. With the current level of operations, the Company will require
cash from external sources to fund this working capital deficit, which relates
principally to accrued and past-due trade accounts payable.
The Company will continue to undertake steps to increase its production
revenue from its Eagle Springs Field and to obtain additional funding from the
sale of additional securities or from the exercise of issued and outstanding
warrants. There can be no assurance that the Company will be successful in any
of its efforts to increase liquidity and capital resources.
Results of Operations
Three Months Ended March 31, 1996 and 1995
For the first quarter period ending March 31, 1996, oil sales increased
20.7% to $300,700 as compared to $248,977 in the same period in 1995, with the
Eagles Springs field contribution approximately $59,300 to such increase. This
increase in the first quarter of 1996 was the result of both a 5.2% increase in
barrels produced and a 9.5% increase in price as compared to the same period in
1995. Well service and well operator income increased $3,800 for the first
quarter of 1996, when compared to the same period in 1995; primarily due to an
increase of $5,300 in operator income and a reduction of $1,500 in well service
revenue due to lack of third party water disposal fees.
The Company's production expenses for the first quarter 1996 decreased
$2,000, with the Eagle Springs field production expense increasing $1,800. This
is significant in that the Company was able to produce and sell more oil for
only a small increase in production cost for the first quarter ended March 31,
1996, when compared to the same quarter in 1995.
Oil and gas exploration expenses increased $9,800 for the first quarter
of 1996 when compared to the same period in 1995. This is primarily due to
increased cost in preparation of the reserve report by an unaffiliated
engineering company. Dry hole, abandonment, and impairment costs were $443,800
for the first quarter ended March 31, 1996. This is an increase of $346,900
when compared to the same period in 1995. During the first quarter of 1996, the
Company was required by the Financing Accounting Standards Board in their new
statement titled "Accounting for Long-Lived Assets," to impair undepleted book
value of the North Willow no. 6-27 well to the value of its reserves. This
resulted in an impairment of $429,900. Additionally, the Company wrote off a
surrendered and abandoned lease of $12,800 in the first quarter of 1995. Dry
hole costs were $1,300 for the first quarter of 1996, which was a decrease from
the $97,700 for the same period in 1995.
General and administrative expenses decreased $124,800 to $136,500 for the
three-month period ended March 31, 1996, when compared to the same period in
1995, principally due to decreased expense of $116,400 related to financial
public relations information dissemination within the investment community.
Additionally, professional services decreased $6,800 for the three-month period
ended March 31, 1996, when compared to the same period in 1995. Depreciation,
depletion, and amortization increased for the three-month period ended March 31,
1996, by $105,600 to $225,900 when compared to the same period in 1995. The
Eagle Springs field contributed $104,500 of the increase of the first quarter
1996 when compared to the same period in 1995.
Interest income was reduced $2,800 to $28,600 for the three-month period
ended March 31, 1996, when compared to the same period in 1995. Reduced
outstanding notes receivable balances reduced accrued interest income $6,400.
Offsetting this decrease was an increase in interest earned on short-term
investments. Interest expense increased due to interest rate increase
associated with the $400,000 note payable due on April 30, 1996, and interest
charges on vendor invoices.
Accounting Treatment of Certain Capitalized Costs
Included in oil and gas properties on the Company's balance sheets are
costs of wells in progress. Such costs are capitalized until a decision is made
to plug and abandon or, if the well is still being evaluated, until one year
after reaching total depth, at which time such costs are charged to expense,
even though the well may subsequently be placed into production. The Company
also charges to expense the amount by which the total capitalized cost of proved
oil and gas properties exceeds the total undiscounted net present value of
related reserves. As a result of the foregoing policies, the Company expects
that from time to time capitalized costs will be charged to expense based on
management's evaluation of specific wells or properties or the disposition,
through sales or conveyances of fractional interests in connection with industry
sharing arrangements, of property interests for consideration in amounts that
have the effect of reducing the Company's total undiscounted net present value
of oil and gas reserves below the total capitalized cost of proved oil and gas
properties. As part of the Company's evaluation of its oil and gas reserves in
connection with the preparation of the Company's annual financial statements,
the Company obtains an engineering evaluation of its properties based on current
engineering information, oil and gas prices, and production costs, which may
result in material changes in the total undiscounted net present value of the
Company's oil and gas reserves. The Company would be required to charge to
expense the amount by which the total capitalized cost of proved oil and gas
properties exceeds the amount of such undiscounted net present value of the
Company's oil and gas reserves.
In March 1995, The Financial Accounting Standards Board (FASB) issued a new
Statement titled "Accounting for Impairment of Long-Lived Assets." This new
standard is effective for years beginning after December 15, 1995. The effect
of the new standard on the Company's financial statements required impairment
expense in the first quarter of 1996 of $429,900, the undepleted value of the
North Willow Creek well no 6-27, less the value of the reserves associated with
that well.
Operating Costs
Overall operating costs are a combination of costs associated with each
well and costs associated with operation of the entire field. As additional
wells are added to the production system, the field operating costs will be
spread among additional wells, lowering the impact of such costs on each well
and per barrel produced. Because of the foregoing, the Company expects that
production costs per barrel will continue to be higher than industry standards,
unless and until the amount of production increases sufficiently to obtain
economies of scale and dilute the impact of high fixed operating costs. In
addition, operating costs may continue to vary materially due to the costs of
ongoing treatment or reworking of existing wells and other factors.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
None.
(b) Reports on Form 8-K.
None.
During the quarter ended March 31, 1996, the Company did not file any
report on Form 8-K.
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 thereunto duly authorized.
FORELAND CORPORATION
(Registrant)
Dated: May 20, 1996 By: /s/ Kenneth L. Ransom,
Vice-President
Dated: May 20, 1996 By: /s/ Don W. Treece,
Controller (Chief Financial Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AS OF MARCH 31, 1996, AND STATEMENT OF OPERATIONS FOR THE PERIOD ENDED
MARCH 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 267,091
<SECURITIES> 0
<RECEIVABLES> 296,427
<ALLOWANCES> 0
<INVENTORY> 58,563
<CURRENT-ASSETS> 660,622
<PP&E> 7,424,354
<DEPRECIATION> 3,045,882
<TOTAL-ASSETS> 5,467,823
<CURRENT-LIABILITIES> 2,791,514
<BONDS> 0
0
1,301
<COMMON> 14,678
<OTHER-SE> 2,638,382
<TOTAL-LIABILITY-AND-EQUITY> 5,467,823
<SALES> 300,694
<TOTAL-REVENUES> 315,707
<CGS> 0
<TOTAL-COSTS> 1,080,216
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 73,644
<INCOME-PRETAX> (809,573)
<INCOME-TAX> 0
<INCOME-CONTINUING> (809,573)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (809,573)
<EPS-PRIMARY> (0.06)
<EPS-DILUTED> (0.04)
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