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 September 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. 2-99079A
PARKER & PARSLEY 85-A, LTD.
(Exact name of Registrant as specified in its charter)
Texas 75-2064518
(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 14 pages.
-There are no exhibits-
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PARKER & PARSLEY 85-A, LTD.
TABLE OF CONTENTS
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of September 30, 1996 and
December 31, 1995 .................................... 3
Statements of Operations for the three and nine
months ended September 30, 1996 and 1995................. 4
Statement of Partners' Capital for the nine months
ended September 30, 1996................................. 5
Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995.............................. 6
Notes to Financial Statements.............................. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations...................... 9
Part II. Other Information
Item 1. Legal Proceedings.......................................... 13
Signatures................................................. 14
2
<PAGE>
PARKER & PARSLEY 85-A, LTD.
(A Texas Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
September 30, December 31,
1996 1995
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $85,680 at September 30
and $36,828 at December 31 $ 85,855 $ 36,955
Accounts receivable - oil and gas sales 60,951 66,952
---------- ----------
Total current assets 146,806 103,907
---------- ----------
Oil and gas properties - at cost, based on the
successful efforts accounting method 7,380,976 8,386,246
Accumulated depletion (6,039,977) (6,965,364)
---------- ----------
Net oil and gas properties 1,340,999 1,420,882
---------- ----------
$ 1,487,805 $ 1,524,789
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 47,938 $ 42,816
Partners' capital:
Limited partners (9,613 interests) 1,425,457 1,467,142
Managing general partner 14,410 14,831
---------- ----------
1,439,867 1,481,973
---------- ----------
$ 1,487,805 $ 1,524,789
========== ==========
The financial information included as of September 30, 1996 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 85-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
1996 1995 1996 1995
--------- --------- --------- ---------
Revenues:
Oil and gas $ 148,906 $ 133,961 $ 438,109 $ 437,777
Interest 1,103 1,001 2,686 2,843
Litigation settlement - - 32,694 -
Salvage income from equipment
disposals - - - 27,471
-------- -------- -------- --------
150,009 134,962 473,489 468,091
-------- -------- -------- --------
Costs and expenses:
Oil and gas production 68,178 82,438 229,155 244,156
General and administrative 4,467 4,019 13,143 13,133
Depletion 25,493 57,962 81,456 162,128
Loss on sale of assets 55 - 3,785 -
-------- -------- -------- --------
98,193 144,419 327,539 419,417
-------- -------- -------- --------
Net income (loss) $ 51,816 $ (9,457) $ 145,950 $ 48,674
======== ======== ======== ========
Allocation of net income (loss):
Managing general partner $ 519 $ (94) $ 1,460 $ 487
======== ======== ======== ========
Limited partners $ 51,297 $ (9,363) $ 144,490 $ 48,187
======== ======== ======== ========
Net income (loss) per limited
partnership interest $ 5.34 $ (.98) $ 15.03 $ 5.01
======== ======== ======== ========
Distributions per limited
partnership interest $ 6.50 $ 4.49 $ 19.37 $ 17.54
======== ======== ======== ========
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 85-A, LTD.
(A Texas Limited Partnership)
STATEMENT OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
-------- ----------- -----------
Balance at January 1, 1996 $ 14,831 $ 1,467,142 $ 1,481,973
Distributions (1,881) (186,175) (188,056)
Net income 1,460 144,490 145,950
------- ---------- ----------
Balance at September 30, 1996 $ 14,410 $ 1,425,457 $ 1,439,867
======= ========== ==========
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 85-A, LTD.
(A Texas Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine months ended
September 30,
-------------------------
1996 1995
---------- ----------
Cash flows from operating activities:
Net income $ 145,950 $ 48,674
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion 81,456 162,128
Salvage income from equipment disposals - (27,471)
Loss on sale of assets 3,785 -
Changes in assets and liabilities:
Decrease in accounts receivable 6,001 7,021
Increase in accounts payable 3,872 6,883
--------- ---------
Net cash provided by operating activities 241,064 197,235
--------- ---------
Cash flows from investing activities:
Additions to oil and gas properties (4,108) (47,509)
Proceeds from salvage income on equipment
disposals - 27,471
--------- ---------
Net cash used in investing activities (4,108) (20,038)
--------- ---------
Cash flows from financing activities:
Cash distributions to partners (188,056) (170,316)
--------- ---------
Net increase in cash and cash equivalents 48,900 6,881
Cash and cash equivalents at beginning of period 36,955 26,174
--------- ---------
Cash and cash equivalents at end of period $ 85,855 $ 33,055
========= =========
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.
6
<PAGE>
PARKER & PARSLEY 85-A, LTD.
(A Texas Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 1996
(Unaudited)
Note 1.
Parker & Parsley 85-A, Ltd. (the "Registrant") is a limited partnership
organized in 1985 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 September 30, 1996 and for the three and nine months ended September 30, 1996
and 1995 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. These interim results are not necessarily
indicative of results for a full year.
Certain information and footnote disclosure normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted in this Form 10-Q pursuant to the rules and
regulations of the Securities and Exchange Commission. 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
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.
7
<PAGE>
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 $330,598, or $34.39 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
summary judgment against Dresser Industries and Baker Hughes for an amount yet
to be determined. Pursuant to their indemnity obligations, the Registrant,
Southmark, PPDLP and other original plaintiffs have vigorously protected the
rights of both Dresser and Baker Hughes. Southmark has vigorously pursued its
appeal of the judgment, and has 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. On June 28, 1996, a final distribution was made to the working
interest owners, including $32,367, or $3.37 per limited partnership interest to
the Registrant and its partners.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations (1)
Results of Operations
Nine months ended September 30, 1996 compared with nine months ended September
30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $438,109 from $437,777 for
the nine months ended September 30, 1996 and 1995, respectively, an increase of
$332. The increase in revenues resulted from higher average prices received per
barrel of oil and mcf of gas, offset by a 14% decline in barrels of oil produced
and sold and a 24% decline in mcf of gas produced and sold. For the nine months
ended September 30, 1996, 15,759 barrels of oil were sold compared to 18,405 for
the same period in 1995, a decrease of 2,646 barrels. Of the decrease, 1,212
barrels, or 6%, was attributable to the sale of four oil and gas wells during
the nine months ended September 30, 1996, with the remaining decrease of 1,434
barrels, or 8%, due to the decline characteristics of the Registrant's oil and
gas properties. For the nine months ended September 30, 1996, 53,907 mcf of gas
were sold compared to 71,093 for the same period in 1995, a decrease of 17,186
mcf. Of the decrease, 1,709 mcf, or 2%, was attributable to the sale of four oil
and gas wells during the nine months ended September 30, 1996 with the remaining
decrease of 15,477 mcf, or 22%, due to the decline characteristics of the
Registrant's oil and gas properties. Because of these decline characteristics,
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 $3.65, or 21% from $17.22
for the nine months ended September 30, 1995 to $20.87 for the same period in
1996 while the average price received per mcf of gas increased 19% from $1.70
during the nine months ended September 30, 1995 to $2.03 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 nine months ended
September 30, 1996.
Salvage income of $27,471 received from equipment disposals for the nine months
ended September 30, 1995 consisted of proceeds received from equipment sales on
one fully depleted well. There were no equipment sales proceeds received for the
same period in 1996.
Costs and Expenses:
Total costs and expenses decreased to $327,539 for the nine months ended
September 30, 1996 as compared to $419,417 for the same period in 1995, a
decrease of $91,878, or 22%. This decrease was due to declines in production
costs and depletion, offset by increases in general and administrative expenses
("G&A") and loss on sale of assets.
9
<PAGE>
Production costs were $229,155 for the nine months ended September 30, 1996 and
$244,156 for the same period in 1995 resulting in a $15,001 decrease, or 6%. The
decrease was primarily attributable to a reduction in well repair and
maintenance costs.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A increased, in aggregate, from $13,133 for the nine months ended
September 30, 1995 to $13,143 for the same period in 1996. The Partnership
agreement limits G&A to 3% of gross oil and gas revenues.
Depletion was $81,456 for the nine months ended September 30, 1996 compared to
$162,128 for the same period in 1995, representing a decrease of $80,672, or
50%. This decrease was primarily attributable to the following factors: (i) the
sale of properties during 1996, (ii) a reduction in oil production of 2,646
barrels for the nine months ended September 30, 1996 as compared to the same
period in 1995, and (iii) an increase in oil and gas reserves during the third
quarter of 1996 as a result of higher commodity prices.
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,
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 $330,598, or $34.39 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
10
<PAGE>
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 yet
to be determined. Pursuant to their indemnity obligations, the Registrant,
Southmark, PPDLP and other original plaintiffs have vigorously protected the
rights of both Dresser and Baker Hughes. Southmark has vigorously pursued its
appeal of the judgment, and has 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. On June 28, 1996, a final distribution was made to the working
interest owners, including $32,367, or $3.37 per limited partnership interest to
the Registrant and its partners.
Three months ended September 30, 1996 compared with three months ended September
30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $148,906 from $133,961 for
the three months ended September 30, 1996 and 1995, respectively, an increase of
11%. The increase in revenues resulted from higher average prices received per
barrel of oil and mcf of gas, offset by a 10% decline in the barrels of oil
produced and sold and a 28% decrease in the mcf of gas produced and sold. For
the three months ended September 30, 1996, 5,241 barrels of oil were sold
compared to 5,810 for the same period in 1995, a decrease of 569 barrels. Of the
decrease, 536 barrels, or 9%, was attributable to the sale of four oil and gas
wells during the three months ended September 30, 1996, with the remaining
decrease of 33 barrels, or 1%, due to the decline characteristics of the
Registrant's oil and gas properties. For the three months ended September 30,
11
<PAGE>
1996, 18,426 mcf of gas were sold compared to 25,557 for the same period in
1995, a decrease of 7,131 mcf. Of the decrease, 736 mcf, or 3%, was attributable
to the sale of four oil and gas wells during the three months ended September
30, 1996 with the remaining decrease of 6,395 mcf, or 25%, due to the decline
characteristics of the Registrant's oil and gas properties.
The average price received per barrel of oil increased $5.28, or 32%, from
$16.47 for the three months ended September 30, 1995 to $21.75 for the same
period in 1996, while the average price received per mcf of gas increased 27%
from $1.50 for the three months ended September 30, 1995 to $1.89 for the same
period in 1996.
A loss of $55 on the sale of assets was recognized during the three months ended
September 30, 1996. This loss was the result of adjustments to net proceeds from
the sale of four fully depleted oil and gas wells and four saltwater disposal
wells in a prior period.
Costs and Expenses:
Total costs and expenses decreased to $98,193 for the three months ended
September 30, 1996 as compared to $144,419 for the same period in 1995, a
decrease of $46,226, or 32%. This decrease was due to declines in depletion and
production costs, offset by increases in G&A and loss on sale of assets.
Production costs were $68,178 for the three months ended September 30, 1996 and
$82,438 for the same period in 1995 resulting in a $14,260 decrease, or 17%. The
decrease was primarily attributable to less well repair and maintenance costs.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A increased in aggregate, 11%, from $4,019 for the three months ended
September 30, 1995 to $4,467 for the same period in 1996.
Depletion was $25,493 for the three months ended September 30, 1996 compared to
$57,962 for the same period in 1995. This represented a decrease in depletion of
$32,469, or 56%, primarily attributable to the following factors: (i) the sale
of properties during 1996, (ii) a reduction in oil production of 569 barrels for
the three months ended September 30, 1996 as compared to the same period in
1995, and (iii) an increase in oil and gas reserves during the third quarter of
1996 as a result of higher commodity prices.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities increased $43,829 during the nine
months ended September 30, 1996 from the same period ended September 30, 1995,
principally due to the receipt of proceeds from the litigation settlement as
discussed in Note 3 and the reduction of production costs.
12
<PAGE>
Net Cash Used in Investing Activities
The Registrant's investing activities during the nine months ended September 30,
1996 and 1995 included $4,108 and $47,509, respectively, for expenditures
related to equipment replacement on various oil and gas properties.
Proceeds from salvage income of $27,471 were received during the nine months
ended September 30, 1995 from equipment sales on one fully depleted well.
Net Cash Used in Financing Activities
Cash was sufficient for the nine months ended September 30, 1996 to cover
distributions to the partners of $188,056 of which $186,175 was distributed to
the limited partners and $1,881 to the managing general partner. For the same
period ended September 30, 1995, cash was sufficient for distributions to the
partners of $170,316 of which $168,613 was distributed to the limited partners
and $1,703 to the managing general partner.
Cash distributions to the partners of $188,056 for the nine months ended
September 30, 1996 included $32,367 to the limited partners and $327 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
During April 1996, the Registrant completed the settlement of a material
litigation to which it was a party. This litigation and settlement thereof is
described in Note 3 of Notes to Financial Statements above.
13
<PAGE>
PARKER & PARSLEY 85-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 85-A, LTD.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: November 11, 1996 By: /s/ Steven L. Beal
----------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
14
<PAGE>
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<ARTICLE> 5
<CIK> 0000791230
<NAME> 85A.TXT
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 85,855
<SECURITIES> 0
<RECEIVABLES> 60,951
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 146,806
<PP&E> 7,380,976
<DEPRECIATION> 6,039,977
<TOTAL-ASSETS> 1,487,805
<CURRENT-LIABILITIES> 47,938
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,439,867
<TOTAL-LIABILITY-AND-EQUITY> 1,487,805
<SALES> 438,109
<TOTAL-REVENUES> 473,489
<CGS> 0
<TOTAL-COSTS> 327,539
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 145,950
<INCOME-TAX> 0
<INCOME-CONTINUING> 145,950
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 145,950
<EPS-PRIMARY> 15.03
<EPS-DILUTED> 0
</TABLE>
