<PAGE>
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 quarter ended Commission File Number
June 30, 1995 33-9203
DYCO OIL AND GAS PROGRAM 1986-X
(A LIMITED PARTNERSHIP)
(Exact Name of Registrant as specified in its charter)
Minnesota 41-1565819
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or organization) Number)
Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103
-------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(918) 583-1791
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(Registrant's telephone number, including area code)
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
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1995 1994
----------- ------------
CURRENT ASSETS:
Cash and cash equivalents . . . . . . $ 36,246 $ 10,512
Accrued oil and gas sales, including
$20,803 and $27,140 due from
related parties (Note 2) . . . . . . 22,320 27,521
-------- --------
Total current assets . . . . . . . $ 58,566 $ 38,033
NET OIL AND GAS PROPERTIES, utilizing
the full cost method . . . . . . . . . 87,264 98,980
DEFERRED CHARGE . . . . . . . . . . . . . 5,563 5,563
-------- --------
$151,393 $142,576
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable . . . . . . . . . . . $ 4,643 $ 4,007
-------- --------
Total current liabilities . . . . . $ 4,643 $ 4,007
PARTNERS' CAPITAL:
General Partner, issued and outstanding,
21 units . . . . . . . . . . . . . . 1,467 1,385
Limited Partners, issued and outstanding,
2,000 units . . . . . . . . . . . . 145,283 137,184
-------- --------
Total Partners' capital . . . . . . $146,750 $138,569
-------- --------
$151,393 $142,576
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
1995 1994
--------- ---------
REVENUES:
Oil and gas sales, including
$31,506 and $44,782 of sales
to related parties (Note 2) . . . . $34,195 $47,364
Interest . . . . . . . . . . . . . . . 239 369
------- -------
$34,434 $47,733
------- -------
COSTS AND EXPENSES:
Oil and gas production . . . . . . . . $16,041 $14,870
Depreciation, depletion, and amortization
of oil and gas properties . . . . . . . 6,404 10,901
General and administrative (Note 2) . 6,038 4,684
------- -------
$28,483 $30,455
------- -------
NET INCOME . . . . . . . . . . . . . . . $ 5,951 $17,278
======= =======
GENERAL PARTNER (1%) - net income . . . . $ 60 $ 173
======= =======
LIMITED PARTNERS (99%) - net income . . . $ 5,891 $17,105
======= =======
NET INCOME PER UNIT . . . . . . . . . . . $ 3 $ 9
======= =======
UNITS OUTSTANDING . . . . . . . . . . . . 2,021 2,021
======= =======
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
1995 1994
--------- ---------
REVENUES:
Oil and gas sales, including
$58,613 and $93,120 of sales
to related parties (Note 2) . . . . $67,357 $98,098
Interest . . . . . . . . . . . . . . . 339 501
------- -------
$67,696 $98,599
------- -------
COSTS AND EXPENSES:
Oil and gas production . . . . . . . . $34,331 $31,955
Depreciation, depletion, and amortization
of oil and gas properties . . . . . . . 12,532 20,234
General and administrative (Note 2) . 12,652 11,030
------- -------
$59,515 $63,219
------- -------
NET INCOME . . . . . . . . . . . . . . . $ 8,181 $35,380
======= =======
GENERAL PARTNER (1%) - net income . . . . $ 82 $ 354
======= =======
LIMITED PARTNERS (99%) - net income . . . $ 8,099 $35,026
======= =======
NET INCOME PER UNIT . . . . . . . . . . . $ 4 $ 18
======= =======
UNITS OUTSTANDING . . . . . . . . . . . . 2,021 2,021
======= =======
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
1995 1994
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income . . . . . . . . . . . . . . $ 8,181 $35,380
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation, depletion, and amortization
of oil and gas properties . .. . . 12,532 20,234
Decrease in accrued oil and gas sales 5,201 6,249
Increase in accounts payable . . . . 636 62
------- -------
Net cash provided by operating
activities $26,550 $61,925
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to oil and gas properties . ($ 816) $ -
------- -------
Net cash used by investing activities ($ 816) $ -
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions . . . . . . . . . . $ - ($60,630)
------- -------
Net cash used by financing activities $ - ($60,630)
------- -------
NET INCREASE IN CASH AND CASH EQUIVALENTS $25,734 $ 1,295
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 10,512 16,603
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $36,246 $17,898
======= =======
The accompanying condensed notes are an
integral part of these financial statements.
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DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
CONDENSED NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The balance sheets as of June 30, 1995, statements of operations
for the three and six months ended June 30, 1995 and 1994, and
statements of cash flows for the six months ended June 30, 1995
and 1994 have been prepared by Dyco Petroleum Corporation
("Dyco"), the General Partner of the Dyco Oil and Gas Program
1986-X Limited Partnership (the "Program"), without audit. In
the opinion of management all adjustments (which include only
normal recurring adjustments) necessary to present fairly the
financial position at June 30, 1995, results of operations for
the three and six months ended June 30, 1995 and 1994, and
changes in cash flows for the six months ended June 30, 1995 and
1994 have been made.
Information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
It is suggested that these financial statements be read in
conjunction with the financial statements and notes thereto
included in the Program's Annual Report on Form 10-K for the
year ended December 31, 1994. The results of operations for
period ended June 30, 1995 are not necessarily indicative of the
results to be expected for the full year.
The limited partners' net income or loss per unit is based upon
each $5,000 initial capital contribution.
OIL AND GAS PROPERTIES
----------------------
Oil and gas operations are accounted for using the full cost
method of accounting. All productive and non-productive costs
associated with the acquisition, exploration and development of
oil and gas reserves are capitalized. Sales and abandonments of
properties are accounted for as adjustments of capitalized costs
with no gain or loss recognized, unless such adjustments would
significantly alter the relationship between capitalized costs
and proved oil and gas reserves.
The provision for depreciation, depletion, and amortization of
oil and gas properties is calculated by dividing the oil and gas
sales dollars during the year by the estimated future gross
income from the oil and gas properties and applying the
resulting rate to the net remaining costs of oil and gas
properties that have been capitalized, plus estimated future
development costs.
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2. TRANSACTIONS WITH RELATED PARTIES
---------------------------------
Under the terms of the Program's partnership agreement, Dyco is
entitled to receive a reimbursement for all direct expenses and
general and administrative, geological and engineering expenses
it incurs on behalf of the Program. During the six months ended
June 30, 1995 and 1994 such expenses totaled $12,652 and
$11,030, respectively, of which $8,040 and $8,040 were paid to
Dyco.
Affiliates of the Program are the operators of certain of the
Program's properties and their policy is to bill the Program for
all customary charges and cost reimbursements associated with
their activities, together with any compressor rentals,
consulting, or other services provided.
The Program sells gas at market prices to Premier Gas Company
("Premier"), an affiliated company, and Premier may then resell
such gas to third parties at market prices. During the six
months ended June 30, 1995 and 1994 these sales totaled $58,613
and $93,120, respectively. At June 30, 1995 accrued oil and gas
sales included $20,803 due from Premier.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
Net proceeds from the Program's operations less necessary
operating capital are distributed to investors on a
quarterly basis. The net proceeds from production are not
reinvested in productive assets, except to the extent that
producing wells are improved or where methods are employed
to permit more efficient recovery of the Program's reserves
which would result in a positive economic impact.
The Program's available capital from subscriptions has been
spent on oil and gas drilling activities. There should not
be any further material capital resource commitments in the
future. The Program has no bank debt commitments. Cash for
operational purposes will be provided by current oil and gas
production.
RESULTS OF OPERATIONS
---------------------
THREE MONTHS ENDED JUNE 30, 1995 AS COMPARED TO THE THREE
MONTHS ENDED JUNE 30, 1994.
Three months ended June 30,
--------------------------
1995 1994
---- ----
Oil and gas sales $34,195 $47,364
Oil and gas production expenses $16,041 $14,870
Barrels produced 125 167
Mcf produced 23,502 27,402
Average price/Bbl $ 17.05 $ 15.46
Average price/Mcf $ 1.36 $ 1.63
As shown in the table, oil and natural gas sales decreased
27.8% for the three months ended June 30, 1995 as compared
to the three months ended June 30, 1994. This decrease
resulted primarily from the decrease in the volumes and
average prices of natural gas sold. Volumes of oil and
natural gas sold decreased 42 barrels and 3,900 Mcf,
respectively, for the three months ended June 30, 1995 as
compared to the three months ended June 30, 1994. Average
natural gas prices decreased to $1.36 per Mcf for the three
months ended June 30, 1995 from $1.63 per Mcf for the three
months ended June 30, 1994, while average oil prices
increased to $17.05 per barrel for the three months ended
June 30, 1995 from $15.46 per barrel for the three months
ended June 30, 1994.
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Oil and gas production expenses (including lease operating
expenses and production taxes) increased slightly by $1,171
for the three months ended June 30, 1995 as compared to the
three months ended June 30, 1994. This increase was
primarily due to an increase in the general repair and
maintenance expenses incurred on the Program's wells during
the three months ended June 30, 1995 as compared to the
three months ended June 30, 1994. As a percentage of oil
and gas sales, these expenses increased to 46.9% for the
three months ended June 30, 1995 from 31.4% for the three
months ended June 30, 1994. This percentage increase was
primarily due to the decrease in the average price of
natural gas sold during the three months ended June 30, 1955
as compared to the three months ended June 30, 1994.
Depreciation, depletion, and amortization of oil and gas
properties decreased $4,497 for the three months ended June
30, 1995 compared to the three months ended June 30, 1994.
This decrease was primarily the result of the decreases in
the volumes of oil and natural gas sold during the three
months ended June 30, 1995 as compared to the three months
ended June 30, 1994 and an upward revision in the estimate
of the Program's remaining oil and natural gas reserves. As
a percentage of oil and gas sales, this expense decreased to
18.7% for the three months ended June 30, 1995 compared to
23.0% for the three months ended June 30, 1994. This
percentage decrease was primarily a result of the dollar
decrease in depreciation, depletion, and amortization
expense discussed above, partially offset by the decrease in
the average price of natural gas sold during the three
months ended June 30, 1995 as compared to the three months
ended June 30, 1994.
General and administrative expenses increased $1,354 for the
three months ended June 30, 1995 as compared to the three
months ended June 30, 1994. This dollar increase resulted
primarily from an increase in the Program's professional
fees during the three months ended June 30, 1995 as compared
to the three months ended June 30, 1994. As a percentage of
oil and gas sales, these expenses increased to 17.7% for the
three months ended June 30, 1995 from 9.9% for the three
months ended June 30, 1994. This percentage increase was
primarily due to the decrease in the average price of
natural gas sold during the three months ended June 30, 1995
as compared to the three months ended June 30, 1994.
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SIX MONTHS ENDED JUNE 30, 1995 AS COMPARED TO THE SIX MONTHS
ENDED JUNE 30, 1994.
Six months ended June 30
------------------------
1995 1994
---- ----
Oil and gas sales $67,357 $98,098
Oil and gas production expenses $34,331 $31,955
Barrels produced 245 330
Mcf produced 47,934 52,415
Average price/Bbl $ 16.63 $ 15.08
Average price/Mcf $ 1.32 $ 1.78
As shown in the table, oil and natural gas sales decreased
31.3% for the six months ended June 30, 1995 as compared to
the six months ended June 30, 1994. This decrease primarily
resulted from the decreases in the volumes and average
prices of natural gas sold. Volumes of oil and natural gas
sold decreased 85 barrels and 4,481 Mcf, respectively, for
the six months ended June 30, 1995 as compared to the six
months ended June 30, 1994. Average natural gas prices
decreased to $1.32 per Mcf for the six months ended June 30,
1995 from $1.78 per Mcf for the six months ended June 30,
1994, while average oil prices increased to $16.63 per
barrel for the six months ended June 30, 1995 from $15.08
per barrel for the six months ended June 30, 1994.
Oil and gas production expenses (including lease operating
expenses and production taxes) increased slightly by $2,376
for the six months ended June 30, 1995 as compared to the
six months ended June 30, 1994. This increase was primarily
due to an increase in the general repair and maintenance
expenses incurred on the Program's wells during the six
months ended June 30, 1995 as compared to the six months
ended June 30, 1994. As a percentage of oil and gas sales,
these expenses increased to 51.0% for the six months ended
June 30, 1995 from 32.6% for the six months ended June 30,
1994. This percentage increase was primarily due to the
decrease in the average price of natural gas sold during the
six months ended June 30, 1995 as compared to the six months
ended June 30, 1994.
Depreciation, depletion, and amortization of oil and gas
properties decreased $7,702 for the six months ended June
30, 1995 as compared to the six months ended June 30, 1994.
This decrease was primarily the result of the decreases in
the volumes of oil and natural gas sold during the six
months ended June 30, 1995 as compared to the six months
ended June 30, 1994 and a significant upward revision in the
estimate of the Program's remaining oil and natural gas
reserves. As a percentage of oil and gas sales, this
expense decreased slightly to 18.6% for the six months ended
June 30, 1995 compared to 20.6% for the six months ended
June 30, 1994. This percentage decrease was primarily a
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result of the dollar decrease in depreciation, depletion,
and amortization expenses as discussed above, partially
offset by the decrease in the average price of natural gas
sold during the six months ended June 30, 1995 as compared
to the six months ended June 30, 1994.
General and administrative expenses increased $1,622 for the
six months ended June 30, 1995 as compared to the six months
ended June 30, 1994. This dollar increase resulted
primarily from an increase in the Program's professional
fees during the six months ended June 30, 1995 as compared
to the six months ended June 30, 1994. As a percentage of
oil and gas sales, these expenses increased to 18.8% for the
six months ended June 30, 1995 from 11.2% for the six months
ended June 30, 1994. This percentage increase was primarily
due to the decrease in the average price of natural gas sold
during the six months ended June 30, 1995 as compared to the
six months ended June 30, 1994.
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PART II: OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
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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.
DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
(Registrant)
By: DYCO PETROLEUM CORPORATION
General Partner
Date: August 10, 1995 By: /s/Dennis R. Neill
--------------------------
(Signature)
Dennis R. Neill
Senior Vice President
Date: August 10, 1995 By: /s/Patrick M. Hall
--------------------------
(Signature)
Patrick M. Hall
Senior Vice President -
Controller
Principal Accounting
Officer
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<ARTICLE> 5
<CIK> 0000803095
<NAME> DYCO OIL AND GAS PROGRAM 1986-X LIMITED PARTNERSHIP
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 36,246
<SECURITIES> 0
<RECEIVABLES> 22,320
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 58,566
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 151,393
<CURRENT-LIABILITIES> 4,643
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 146,750
<TOTAL-LIABILITY-AND-EQUITY> 151,393
<SALES> 67,357
<TOTAL-REVENUES> 67,696
<CGS> 0
<TOTAL-COSTS> 59,515
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 8,181
<INCOME-TAX> 0
<INCOME-CONTINUING> 8,181
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,181
<EPS-PRIMARY> 4.00
<EPS-DILUTED> 0
</TABLE>
