UNITED STATES
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, 1996, or
/ / Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period from _______ to _______
Commission File No. 33-3353A
PARKER & PARSLEY 86-A, LTD.
(Exact name of Registrant as specified in its charter)
Texas 75-2124884
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
303 West Wall, Suite 101,
Midland, Texas 79701
(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code: (915)683-4768
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 / /
Page 1 of 15 pages.
There are no exhibits.
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
BALANCE SHEETS
June 30, December 31,
1996 1995
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including
interest bearing deposits of
$543,689 at June 30 and $66,392 at
December 31 $ 543,913 $ 66,625
Accounts receivable - oil and gas sales 73,195 106,785
---------- ----------
Total current assets 617,108 173,410
Oil and gas properties - at cost, based
on the successful efforts accounting
method 7,207,751 8,008,245
Accumulated depletion (5,675,856) (6,165,170)
---------- ----------
Net oil and gas properties 1,531,895 1,843,075
---------- ----------
$ 2,149,003 $ 2,016,485
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 104,821 $ 62,993
Partners' capital:
Limited partners (10,131 interests) 2,025,046 1,935,262
Managing general partner 19,136 18,230
---------- ----------
2,044,182 1,953,492
---------- ----------
$ 2,149,003 $ 2,016,485
========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended Six months ended
June 30, June 30,
1996 1995 1996 1995
---------- ---------- ---------- ----------
Revenues:
Oil and gas sales $ 194,835 $ 205,918 $ 410,878 $ 414,138
Interest income 1,521 839 2,638 1,618
Salvage income from
equipment disposal - 6,734 14,605 6,734
Gain on sale of assets 163,096 - 163,096 -
Litigation settlement 290,690 - 290,690 -
--------- --------- --------- ---------
Total revenues 650,142 213,491 881,907 422,490
Costs and expenses:
Production costs 119,086 127,873 235,961 258,927
General and adminis-
trative expenses 5,845 6,177 12,326 12,424
Depletion 36,094 67,991 80,273 155,326
--------- --------- --------- ---------
Total costs and
expenses 161,025 202,041 328,560 426,677
--------- --------- --------- ---------
Net income (loss) $ 489,117 $ 11,450 $ 553,347 $ (4,187)
========= ========= ========= =========
Allocation of net
income (loss):
Managing general
partner $ 4,891 $ 115 $ 5,533 $ (42)
========= ========= ========= =========
Limited partners $ 484,226 $ 11,335 $ 547,814 $ (4,145)
========= ========= ========= =========
Net income (loss) per
limited partnership
interest $ 47.79 $ 1.12 $ 54.07 $ (.41)
========= ========= ========= =========
Distributions per
limited partnership
interest $ 37.70 $ 5.68 $ 45.21 $ 13.19
========= ========= ========= =========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
----------- ----------- -----------
Balance at January 1, 1995 $ 26,129 $ 2,717,034 $ 2,743,163
Distributions (1,352) (133,590) (134,942)
Net loss (42) (4,145) (4,187)
---------- ---------- ----------
Balance at June 30, 1995 $ 24,735 $ 2,579,299 $ 2,604,034
========== ========== ==========
Balance at January 1, 1996 $ 18,230 $ 1,935,262 $ 1,953,492
Distributions (4,627) (458,030) (462,657)
Net income 5,533 547,814 553,347
---------- ---------- ----------
Balance at June 30, 1996 $ 19,136 $ 2,025,046 $ 2,044,182
========== ========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Six months ended
June 30,
1996 1995
----------- ----------
Cash flows from operating activities:
Net income (loss) $ 553,347 $ (4,187)
Adjustments to reconcile net income
(loss) to net cash provided by operating
activities:
Depletion 80,273 155,326
Salvage income from equipment disposals (14,605) (6,734)
Gain on sale of assets (163,096) -
Changes in assets and liabilities:
Decrease in accounts receivable 33,590 3,466
Increase in accounts payable 42,595 36,886
--------- ---------
Net cash provided by operating
activities 532,104 184,757
Cash flows from investing activities:
Additions to oil and gas properties (3,989) (21,937)
Proceeds from salvage income on
equipment disposals 14,605 6,734
Proceeds from sale of assets 397,225 -
--------- ---------
Net cash provided by (used in)
investing activities 407,841 (15,203)
Cash flows from financing activities:
Cash distributions to partners (462,657) (134,942)
--------- ---------
Net increase in cash and cash equivalents 477,288 34,612
Cash and cash equivalents at beginning
of period 66,625 25,005
--------- ---------
Cash and cash equivalents at end of period $ 543,913 $ 59,617
========= =========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
(Unaudited)
NOTE 1.
Parker & Parsley 86-A, Ltd. (the "Registrant") is a limited partnership
organized in 1986 under the laws of the State of Texas.
The Registrant engages primarily in oil and gas development and production in
Texas and is not involved in any industry segment other than oil and gas.
NOTE 2.
In the opinion of management, the Registrant's unaudited financial statements as
of June 30, 1996 include all adjustments and accruals consisting only of normal
recurring accrual adjustments which are necessary for a fair presentation of the
results for the interim period. However, these interim results are not
necessarily indicative of results for a full year.
The financial statements should be read in conjunction with the financial
statements and the notes thereto contained in the Registrant's Report on Form
10-K for the year ended December 31, 1995, as filed with the Securities and
Exchange Commission, a copy of which is available upon request by writing to
Steven L. Beal, Senior Vice President, 303 West Wall, Suite 101, Midland, Texas
79701.
NOTE 3.
On May 25, 1993, a final settlement agreement was negotiated, drafted and
finally executed, ending litigation which had begun on September 5, 1989, when
the Registrant filed suit along with other parties against Dresser Industries,
Inc.; Titan Services, Inc.; BJ-Titan Services Company; BJ- Hughes Holding
Company; Hughes Tool Company; Baker Hughes Production Tools, Inc.; and Baker
Hughes Incorporated alleging that the defendants had intentionally failed to
provide the materials and services ordered and paid for by the Registrant and
other parties in connection with the fracturing and acidizing of 523 wells, and
then fraudulently concealed the shorting practice from Parker & Parsley
Development L.P. ("PPDLP"). The May 25, 1993 settlement agreement called for a
payment of $115 million in cash by the defendants, and Southmark, the
6
<PAGE>
Registrant, and the other plaintiffs indemnified the defendants against the
claims of Jack N. Price. The managing general partner received the funds,
deducted incurred legal expenses, accrued interest, determined the general
partner's portion of the funds and calculated any inter-partnership allocations.
On May 3, 1993, Jack N. Price, the attorney who represented Gary G. "Zeke"
Lancaster in the Federal Court lawsuit, filed suit in State Court in Beaumont
against all of the plaintiff partnerships, including the Registrant and others,
alleging his entitlement to 12% of the settlement proceeds. Price's lawsuit
claim for approximately $13.8 million is predicated on a purported contract
entered into with Southmark Corporation in August 1988 in which he allegedly
binds the Registrant and the other defendants, as well as Southmark. Although
PPDLP believes the lawsuit was without merit and has vigorously defended it,
PPDLP has held in reserve approximately 12.5% of the total settlement (the
"Reserve") pending final resolution of the litigation.
A distribution of $91,000,000 was made to the working interest owners, including
the Registrant, on July 30, 1993. The limited partners received their
distribution of $2,882,376, or $284.51 per limited partnership interest, in
September 1993. The allocation of the lawsuit settlement amount was based on the
original verdict entered on October 26, 1990. The allocation to the working
interest owners in each well (including the Registrant) was based on a ratio of
the relative amount of damages due to overcharges for services and materials
("Materials") and damages for loss of past and future production ("Production"),
each as determined in that initial judgment. Within the Registrant, damages for
Materials were allocated between the partners based on their original sharing
percentages for costs of acquiring and/or drilling of wells. Similarly, damages
related to Production were allocated to the partners in the Registrant based on
their respective share of revenues from the subject wells.
As a condition of the purchase by Parker & Parsley Petroleum Company of Parker &
Parsley Development Company ("PPDC"), which was merged into PPDLP on January 1,
1995, from its former parent in May 1989, PPDC's interest in the lawsuit and
subsequent settlement was retained by the former parent. Consequently, all of
PPDC's share of the settlement related to its separately held interests in the
wells and its partnership interests in the sponsored partnerships (except that
portion allocable to interests acquired by PPDC after May 1989) was paid to the
former parent.
On September 20, 1995, the Beaumont trial judge entered a summary judgment
against Southmark for the $13,790,000 contingent fee sought by Price, together
with prejudgment interest, and also awarded Price an additional $5,498,525 in
attorneys' fees. On January 22, 1996, the trial judge entered an interlocutory
7
<PAGE>
summary judgment against Dresser Industries and Baker Hughes for an amount to be
determined. Pursuant to their indemnity obligations, the Registrant, Southmark,
PPDLP and other original plaintiffs vigorously protected the rights of both
Dresser and Baker Hughes. Southmark vigorously pursued its appeal of the
judgment, and posted a supersedeas bond using the Reserve as collateral. On
April 29, 1996, all of the parties, including the Registrant and Southmark,
entered into a $7.4 million settlement with Price which fully and finally
resolves all of the litigation and disputes between the parties, including the
Registrant's indemnity obligations to Dresser and Baker Hughes.
Pursuant to the settlement agreement, all of the pending lawsuits and judgments
have been dismissed, the supersedeas bond released, and the Reserve released as
collateral. The managing general partner conducted an accounting of income and
expenses among the parties, and, on June 28, 1996, made a final $9.3 million
distribution to the working interest owners, including the Registrant and its
partners, resulting in a distribution of $287,784 to the limited partners, or
$28.41 per limited partnership interest. The distribution was allocated to the
limited partners using the same methodology as the original $91 million
distribution in 1993.
NOTE 4.
A gain of $163,096 from the sale of four oil and gas wells to Costilla Energy,
L.L.C. was recognized during the six months ended June 30, 1996, attributable to
proceeds received of $397,225 less the write-off of remaining capitalized well
costs of $234,129.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (1)
Results of Operations
Six months ended June 30, 1996 compared with six months ended June 30, 1995
Revenues:
The Registrant's oil and gas revenues decreased to $410,878 from $414,138 for
the six months ended June 30, 1996 and 1995, respectively. The decrease in
revenues resulted from a 16% decline in barrels of oil produced and sold and a
22% decline in mcf of gas produced and sold, offset by a 16% increase in the
average price received per barrel of oil and a 32% increase in the average price
received per mcf of gas. For the six months ended June 30, 1996, 14,007 barrels
of oil were sold compared to 16,577 for the same period in 1995, a decrease of
8
<PAGE>
2,570 barrels. Of the decrease, 1,393 barrels, or 9%, was attributable to the
sale of four oil and gas wells. The additional decrease of 7%, or 1,177 barrels,
was due to the decline characteristics of the Registrant's oil and gas
properties. For the six months ended June 30, 1996, 59,422 mcf of gas were sold
compared to 75,946 for the same period in 1995, a decrease of 16,524 mcf. Of the
decrease, 6,446 mcf, or 9%, was attributable to the sale of four oil and gas
wells. The additional decrease of 10,078 mcf, or 13%, was due to the decline
characteristics of the Registrant's oil and gas properties. Management expects a
certain amount of decline in production to continue in the future until the
Registrant's economically recoverable reserves are fully depleted.
The average price received per barrel of oil increased $2.75 from $17.60 for the
six months ended June 30, 1995 to $20.35 for the same period in 1996 while the
average price received per mcf of gas increased from $1.61 during the six months
ended June 30, 1995 to $2.12 in 1996. The market price for oil and gas has been
extremely volatile in the past decade, and management expects a certain amount
of volatility to continue in the foreseeable future. The Registrant may
therefore sell its future oil and gas production at average prices lower or
higher than that received during the six months ended June 30, 1996.
Salvage income of $14,605 was received during the six months ended June 30, 1996
from the disposal of equipment on one fully depleted well.
A gain of $163,096 from the sale of four oil and gas wells was recognized during
the six months ended June 30, 1996, attributable to proceeds received of
$397,225 less the write-off of remaining capitalized well costs of $234,129.
Costs and Expenses:
Total costs and expenses decreased to $328,560 for the six months ended June 30,
1996 as compared to $426,677 for the same period in 1995, a decrease of $98,117,
or 23%. This decrease was due to a decline in production costs, general and
administrative expenses ("G&A") and depletion.
Production costs were $235,961 for the six months ended June 30, 1996 and
$258,927 for the same period in 1995 resulting in a $22,966 decrease, or 9%.
This decrease was primarily the result of a reduction in well repair and
maintenance costs, offset by an increase in workover expense incurred in an
effort to stimulate well production.
9
<PAGE>
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A decreased, in aggregate, from $12,424 for the six months ended June
30, 1995 to $12,326 for the same period in 1996. The Partnership agreement
limits G&A to 3% of gross oil and gas revenues.
Depletion was $80,273 for the six months ended June 30, 1996 compared to
$155,326 for the same period in 1995. This represented a decrease in depletion
of $75,053, or 48%, primarily attributable to the adoption of the provisions of
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("FAS 121") effective the fourth quarter of 1995 and the reduction of net
depletable basis resulting from the charge taken upon such adoption. In
addition, of the decrease, 7% was attributable to the sale of four oil and gas
wells during the six months ended June 30, 1996. Depletion was computed
property-by-property utilizing the unit-of-production method based upon the
dominant mineral produced, generally oil. Oil production decreased 2,570 barrels
for the six months ended June 30, 1996 from the same period in 1995, while oil
reserves of barrels were revised upward by 17,716 barrels, or 5%.
On May 25, 1993, a final settlement agreement was negotiated, drafted and
finally executed, ending litigation which had begun on September 5, 1989, when
the Registrant filed suit along with other parties against Dresser Industries,
Inc.; Titan Services, Inc.; BJ-Titan Services Company; BJ- Hughes Holding
Company; Hughes Tool Company; Baker Hughes Production Tools, Inc.; and Baker
Hughes Incorporated alleging that the defendants had intentionally failed to
provide the materials and services ordered and paid for by the Registrant and
other parties in connection with the fracturing and acidizing of 523 wells, and
then fraudulently concealed the shorting practice from PPDLP. The May 25, 1993
settlement agreement called for a payment of $115 million in cash by the
defendants, and Southmark, the Registrant, and the other plaintiffs indemnified
the defendants against the claims of Jack N. Price. The managing general partner
received the funds, deducted incurred legal expenses, accrued interest,
determined the general partner's portion of the funds and calculated any
inter-partnership allocations.
On May 3, 1993, Jack N. Price, the attorney who represented Gary G. "Zeke"
Lancaster in the Federal Court lawsuit, filed suit in State Court in Beaumont
against all of the plaintiff partnerships, including the Registrant and others,
alleging his entitlement to 12% of the settlement proceeds. Price's lawsuit
claim for approximately $13.8 million is predicated on a purported contract
entered into with Southmark Corporation in August 1988 in which he allegedly
binds the Registrant and the other defendants, as well as Southmark. Although
PPDLP believes the lawsuit was without merit and has vigorously defended it,
10
<PAGE>
PPDLP has held in reserve approximately 12.5% of the total settlement (the
"Reserve") pending final resolution of the litigation.
A distribution of $91,000,000 was made to the working interest owners, including
the Registrant, on July 30, 1993. The limited partners received their
distribution of $2,882,376, or $284.51 per limited partnership interest, in
September 1993. The allocation of the lawsuit settlement amount was based on the
original verdict entered on October 26, 1990. The allocation to the working
interest owners in each well (including the Registrant) was based on a ratio of
the relative amount of damages due to overcharges for services and materials
("Materials") and damages for loss of past and future production ("Production"),
each as determined in that initial judgment. Within the Registrant, damages for
Materials were allocated between the partners based on their original sharing
percentages for costs of acquiring and/or drilling of wells. Similarly, damages
related to Production were allocated to the partners in the Registrant based on
their respective share of revenues from the subject wells.
As a condition of the purchase by Parker & Parsley Petroleum Company of PPDC,
which was merged into PPDLP on January 1, 1995, from its former parent in May
1989, PPDC's interest in the lawsuit and subsequent settlement was retained by
the former parent. Consequently, all of PPDC's share of the settlement related
to its separately held interests in the wells and its partnership interests in
the sponsored partnerships (except that portion allocable to interests acquired
by PPDC after May 1989) was paid to the former parent.
On September 20, 1995, the Beaumont trial judge entered a summary judgment
against Southmark for the $13,790,000 contingent fee sought by Price, together
with prejudgment interest, and also awarded Price an additional $5,498,525 in
attorneys' fees. On January 22, 1996, the trial judge entered an interlocutory
summary judgment against Dresser Industries and Baker Hughes for an amount to be
determined. Pursuant to their indemnity obligations, the Registrant, Southmark,
PPDLP and other original plaintiffs vigorously protected the rights of both
Dresser and Baker Hughes. Southmark vigorously pursued its appeal of the
judgment, and posted a supersedeas bond using the Reserve as collateral. On
April 29, 1996, all of the parties, including the Registrant and Southmark,
entered into a $7.4 million settlement with Price which fully and finally
resolves all of the litigation and disputes between the parties, including the
Registrant's indemnity obligations to Dresser and Baker Hughes.
Pursuant to the settlement agreement, all of the pending lawsuits and judgments
have been dismissed, the supersedeas bond released, and the Reserve released as
collateral. The managing general partner conducted an accounting of income and
11
<PAGE>
expenses among the parties, and, on June 28, 1996, made a final $9.3 million
distribution to the working interest owners, including the Registrant and its
partners, resulting in a distribution of $287,784 to the limited partners, or
$28.41 per limited partnership interest. The distribution was allocated to the
limited partners using the same methodology as the original $91 million
distribution in 1993.
Three months ended June 30, 1996 compared with three months ended June 30, 1995
Revenues:
The Registrant's oil and gas revenues decreased to $194,835 from $205,918 for
the three months ended June 30, 1996 and 1995, respectively, a decrease of 5%.
The decrease in revenues resulted from a 20% decline in barrels of oil produced
and sold and a 39% decline in mcf of gas produced and sold, offset by a 23%
increase in the average price received per barrel of oil and a 42% increase in
the average price received per mcf of gas. For the three months ended June 30,
1996, 6,279 barrels of oil were sold compared to 7,841 for the same period in
1995, a decrease of 1,562 barrels. Of the decrease, 1,244 barrels, or 16%, was
attributable to the sale of four oil and gas wells. The additional decrease of
4%, or 318 barrels, was due to the decline characteristics of the Registrant's
oil and gas properties. For the three months ended June 30, 1996, 25,517 mcf of
gas were sold compared to 41,717 for the same period in 1995, a decrease of
16,200 mcf. Of the decrease, 6,169 mcf, or 15%, was attributable to the sale of
four oil and gas wells. The additional decrease of 10,031 mcf, or 24%, was due
to the decline characteristics of the Registrant's oil and gas properties.
The average price received per barrel of oil increased $4.08 from $18.10 for the
three months ended June 30, 1995 to $22.18 for the same period in 1996 while the
average price received per mcf of gas increased from $1.53 during the three
months ended June 30, 1995 to $2.18 in 1996.
A gain of $163,096 from the sale of four oil and gas wells was recognized during
the three months ended June 30, 1996, attributable to proceeds received of
$397,225 less the write-off of remaining capitalized well costs of $234,129.
12
<PAGE>
Costs and Expenses:
Total costs and expenses decreased to $161,025 for the three months ended June
30, 1996 as compared to $202,041 for the same period in 1995, a decrease of
$41,016, or 20%. This decrease was due to declines in production costs, G&A and
depletion.
Production costs were $119,086 for the three months ended June 30, 1996 and
$127,873 for the same period in 1995 resulting in a $8,787 decrease, or 7%. This
decrease was primarily the result of a decline in well repair and maintenance
costs, offset by an increase in workover expense incurred in an effort to
stimulate well production.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A decreased, in aggregate, 5% from $6,177 for the three months ended
June 30, 1995 to $5,845 for the same period in 1996.
Depletion was $36,094 for the three months ended June 30, 1996 compared to
$67,991 for the same period in 1995. This represented a decrease in depletion of
$31,897, or 47%, primarily attributable to the adoption of FAS 121 the fourth
quarter of 1995, as discussed previously. In addition, of the decrease, 13% was
attributable to the sale of four oil and gas wells.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased during the six months ended
June 30, 1996 $347,347 from the same period ended June 30, 1995. This increase
was primarily due to the receipt of proceeds from the litigation settlement as
discussed in Note 3, and an increase in average prices received for oil and gas
sold.
Net Cash Provided by (Used in) Investing Activities
The Registrant's principal investing activities for the six months ended June
30, 1996 and 1995 included expenditures related to equipment replacement on
various oil and gas properties.
The Registrant received proceeds during the six months ended June 30, 1996 and
1995 from the disposal of oil and gas equipment.
Proceeds of $397,225 were received during the six months ended June 30, 1996
from the sale of four oil and gas wells.
13
<PAGE>
Net Cash Used in Financing Activities
Cash was sufficient for the six months ended June 30, 1996 to cover
distributions to the partners of $462,657 of which $458,030 was distributed to
the limited partners and $4,627 to the managing general partner. For the same
period ended June 30, 1995, cash was sufficient for distributions to the
partners of $134,942 of which $133,590 was distributed to the limited partners
and $1,352 to the managing general partner.
Cash distributions to the partners of $462,657 for the six months ended June 30,
1996 included $287,784 to the limited partners and $2,906 to the managing
general partner, resulting from proceeds received in the litigation settlement
as discussed in Note 3.
It is expected that future net cash provided by operating activities will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.
- ---------------
(1) "Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains forward looking statements that involve
risks and uncertainties. Accordingly, no assurances can be given that the
actual events and results will not be materially different than the
anticipated results described in the forward looking statements.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Registrant is party to material litigation which is described in Note 3 of
Notes to Financial Statements above.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - none
(b) Reports on Form 8-K - none
14
<PAGE>
PARKER & PARSLEY 86-A, LTD.
(A Texas Limited Partnership)
S I G N A T U R E S
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.
PARKER & PARSLEY 86-A, LTD.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: August 9, 1996 By: /s/ Steven L. Beal
---------------------------------------
Steven L. Beal, Senior Vice
President and Chief Financial
Officer of PPUSA
15
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000789789
<NAME> 86A.TXT
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 543,913
<SECURITIES> 0
<RECEIVABLES> 73,195
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 617,108
<PP&E> 7,207,751
<DEPRECIATION> 5,675,856
<TOTAL-ASSETS> 2,149,003
<CURRENT-LIABILITIES> 104,821
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,044,182
<TOTAL-LIABILITY-AND-EQUITY> 2,149,003
<SALES> 410,878
<TOTAL-REVENUES> 881,907
<CGS> 0
<TOTAL-COSTS> 328,560
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 553,347
<INCOME-TAX> 0
<INCOME-CONTINUING> 553,347
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 553,347
<EPS-PRIMARY> 54.07
<EPS-DILUTED> 0
</TABLE>
