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, 1995
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 0-15432
ENEX OIL & GAS INCOME PROGRAM II - 10, L.P.
(Exact name of small business issuer as specified in its charter)
Texas 76-0163121
(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
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM II - 10, L.P.
BALANCE SHEET
- --------------------------------------------------------------------------------
September 30,
ASSETS 1995
--------------
(Unaudited)
CURRENT ASSETS:
<S> <C>
Cash ......................................................... $ 15,342
Accounts receivable - oil & gas sales ........................ 15,520
Other current assets ......................................... 2,568
----------
Total current assets ........................................... 33,430
----------
OIL & GAS PROPERTIES:
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities ........ 1,894,657
Less accumulated depreciation and depletion ................. 1,395,949
----------
Property, net .................................................. 498,708
----------
TOTAL .......................................................... $ 532,138
==========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable ............................................ $ 6,652
Payable to general partner .................................. 53,400
----------
Total current liabilities ...................................... 60,052
----------
NONCURRENT PAYABLE TO GENERAL PARTNER .......................... 106,800
----------
PARTNERS' CAPITAL:
Limited partners ............................................ 337,486
General partner ............................................. 27,800
----------
Total partners' capital ........................................ 365,286
----------
TOTAL .......................................................... $ 532,138
==========
<FN>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------
</FN>
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM II - 10, L.P.
STATEMENTS OF OPERATIONS
- -------------------------------------------------------------------------------------------
(UNAUDITED) QUARTER ENDED NINE MONTHS
---------------------------- -----------------------------
September 30, September 30, September 30, September 30,
1995 1994 1995 1994
------------- ------------- ------------- ------------
REVENUES:
<S> <C> <C> <C> <C>
Oil and gas sales ........ 51,801 $ 54,986 $ 155,356 $ 142,005
--------- --------- --------- ----------
EXPENSES:
Depreciation and depletion 30,908 31,236 90,414 87,883
Lease operating expenses . 10,823 10,633 35,274 32,655
Production taxes ......... 2,285 2,743 6,994 6,882
General and administrative 5,309 5,391 16,360 14,237
--------- --------- --------- ----------
Total expenses ............. 49,325 50,003 149,042 141,657
--------- --------- --------- ----------
INCOME FROM OPERATIONS ..... 2,476 4,983 6,314 348
--------- --------- --------- ----------
OTHER EXPENSE:
Interest expense ......... -- -- (72) --
--------- --------- --------- ----------
NET INCOME ................. $ 2,476 $ 4,983 $ 6,242 $ 348
========= ========= ========= ==========
<FN>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------------------
</FN>
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
ENEX OIL AND GAS INCOME PROGRAM II - 10, L.P.
STATEMENTS OF CASH FLOWS
- -------------------------------------------------------------------------------
(UNAUDITED)
NINE MONTHS ENDED
--------------------------------
September 30, September 30,
1995 1994
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income .................................... $ 6,242 $ 348
-------- --------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation, depletion and amortization .... 90,414 87,883
(Increase) decrease in:
Accounts receivable - oil & gas sales ....... (1,363) (2,078)
Other current assets ........................ 3,535 (231)
(Decrease) in:
Accounts payable ........................... (5,192) (11,121)
Payable to general partner ................. (37,594) (30,001)
-------- --------
Total adjustments ............................. 49,800 44,452
-------- --------
Net cash provided by operating activities ..... 56,042 44,800
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions - development costs .... (22,786) (8,270)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ......................... (22,566) (30,180)
-------- --------
NET INCREASE IN CASH .......................... 10,690 6,350
CASH AT BEGINNING OF YEAR ..................... 4,652 4,683
-------- --------
CASH AT END OF PERIOD ......................... $ 15,342 $ 11,033
======== ========
<FN>
See accompanying notes to financial statements.
- -------------------------------------------------------------------------------
</FN>
</TABLE>
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<PAGE>
ENEX OIL & GAS INCOME PROGRAM II - 10, 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. A cash distribution was made to the limited partners of the Company in
the amount of $9,319, representing net revenues from the sale of oil
and gas produced from properties owned by the Company. This
distribution was made on July 31, 1995.
I-4
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
Third Quarter 1995 Compared to Third Quarter 1994
Oil and gas sales for the third quarter decreased from $54,986 in 1994 to
$51,801 in 1995. This represents a decrease of $3,185 (6%). Oil sales decreased
by $4,184 (8%). A 2% decrease in oil production reduced sales by $793. A 7%
decrease in the average oil sales price caused an additional $3,391 decrease.
Gas sales increased by $999 (18%). A 28% increase in gas production increased
sales by $1,586. This increase was partially offset by an 8% decrease in the
average gas sales price. The changes in the average oil and gas sales prices
correspond with changes in the overall market for the sale of oil and gas. The
slight decrease in oil production was primarily the result of natural production
declines, partially offset by the acquisition of additional interest in the
Concord acquisition in the fourth quarter of 1994. The increase in gas
production was primarily the result of the completion of a waterflood project on
the Schafter Lake field and the acquisition of additional interest in the
Concord acquisition in the fourth quarter of 1994, partially offset by natural
production declines.
Lease operating expenses increased from $10,633 in 1994 to $10,823 in 1995. The
increase of $190 (2%) is primarily due to the changes in production, noted
above.
Depreciation and depletion expense decreased from $31,236 in the third quarter
of 1994 to $30,908 in the third quarter of 1995. This represents a decrease of
$328 (1%). A 4% decrease in the depletion rate reduced depreciation and
depletion expense by $1,294. This decrease was partially offset by the changes
in production, noted above. The decrease in the depletion rate is primarily the
result of an upward revision of the oil reserves at December 31, 1994, partially
offset by a downward revision of the gas reserves at December 31, 1994.
General and administrative expenses decreased from $5,391 in 1994 to $5,309 in
1995. This decrease of $82 (2%) is primarily due to less staff time being
required to manage the Company's operations.
First Nine Months in 1995 Compared to First Nine Months in 1994
Oil and gas sales for the first nine months increased from $142,005 in 1994 to
$155,356 in 1995. This represents an increase of $13,351 (9%). Oil sales
increased by $13,242 (11%). A 6% increase in oil production caused sales to
increase by $7,998. A 4% increase in the average oil sales price caused an
additional $5,244 increase. Gas sales increased by $109 (1%). A 23% increase in
gas production increased sales by $4,065. This increase was partially offset by
an 18% decrease in the average gas sales price. The changes in the average sales
prices correspond with changes in the overall market for the sale of oil and
gas. The increases in production were primarily the result of the completion of
a waterflood project on the Schafter Lake field and the acquisition of
additional interest in the Concord acquisition in the fourth quarter of 1994.
Lease operating expenses increased from $32,655 in 1994 to $35,274 in 1995. The
increase of $2,619 (8%) is primarily due to the changes in production, noted
above, and enhanced recovery costs incurred on the Concord acquisition in 1995.
I-5
<PAGE>
Depreciation and depletion expense increased from $87,883 in the first nine
months of 1994 to $90,414 in the first nine months of 1995. This represents an
increase of $2,531 (3%). The changes in production, noted above, increased
depreciation and depletion expense by $8,039. This increase was partially offset
by a 6% decrease in the depletion rate. The decrease in the depletion rate is
primarily the result of an upward revision of the oil reserves at December 31,
1994, partially offset by a downward revision of the gas reserves at December
31, 1994.
General and administrative expenses increased from $14,237 in 1994 to $16,360 in
1995. This increase of $2,123 (15%) 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 of net
proceeds realized from the sale of oil and gas production. Accordingly, the
changes in cash flow from 1994 to 1995 are primarily due to the changes in oil
and gas sales described above. It is the general partner's intention to
distribute substantially all of the Company's available cash flow to the
Company's partners.
The Company will continue to recover its reserves and distribute to the limited
partners the net proceeds realized from the sale of oil and gas production.
Distribution amounts are subject to change if net revenues are greater or less
than expected. Nonetheless, the general partner believes the Company will
continue to have sufficient cash flow to fund operations and to maintain a
regular pattern of distributions.
As of September 30, 1995, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
I-6
<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, 1995.
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 hereunto duly
authorized.
ENEX OIL & GAS INCOME
PROGRAM II - 10, 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 11, 1995 By: /s/ James A. Klein
-------------------
James A. Klein
Controller and Chief
Accounting Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Enex Oil & Gas Income Program II-10, L.P.
</LEGEND>
<CIK> 0000799171
<NAME> Enex Oil & Gas Income Program II-10, L.P.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> dec-31-1995
<PERIOD-START> jan-01-1995
<PERIOD-END> sep-30-1995
<CASH> 15342
<SECURITIES> 0
<RECEIVABLES> 15520
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 33430
<PP&E> 1894657
<DEPRECIATION> 1395949
<TOTAL-ASSETS> 532138
<CURRENT-LIABILITIES> 60052
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 365286
<TOTAL-LIABILITY-AND-EQUITY> 532138
<SALES> 155356
<TOTAL-REVENUES> 155356
<CGS> 132682
<TOTAL-COSTS> 132682
<OTHER-EXPENSES> 16360
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (72)
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6242
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
