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
September 30, 1998 33-10346-09 (1980-1)
33-10346-10 (1980-2)
DYCO 1980 OIL AND GAS PROGRAM
(TWO LIMITED PARTNERSHIPS)
(Exact Name of Registrant as specified in its charter)
41-1378908 (1980-1)
Minnesota 41-1385165 (1980-2)
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or Number)
organization)
Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103
- ------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(918) 583-1791
----------------------------------------------------
(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
------ ------
1
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, December 31,
1998 1997
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 17,693 $197,606
Accrued oil and gas sales 46,262 98,315
-------- --------
Total current assets $ 63,955 $295,921
NET OIL AND GAS PROPERTIES, utilizing
the full cost method 365,614 471,863
DEFERRED CHARGE 126,390 126,390
-------- --------
$555,959 $894,174
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $ 6,897 $ 34,756
Gas imbalance payable 11,046 11,046
-------- --------
Total current liabilities $ 17,943 $ 45,802
ACCRUED LIABILITY $ 44,579 $ 44,579
PARTNERS' CAPITAL:
General Partner, issued and
outstanding, 40 units $ 4,934 $ 8,038
Limited Partners, issued and
outstanding, 4,000 units 488,503 795,755
-------- --------
Total Partners' capital $493,437 $803,793
-------- --------
$555,959 $894,174
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
2
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
-------- --------
REVENUES:
Oil and gas sales $87,267 $150,705
Interest 1,315 1,312
------- --------
$88,582 $152,017
COSTS AND EXPENSES:
Oil and gas production $30,436 $ 42,212
Depreciation, depletion, and
amortization of oil and gas
properties 27,134 19,345
General and administrative
(Note 2) 15,325 16,157
------- --------
$72,895 $ 77,714
------- --------
NET INCOME $15,687 $ 74,303
======= ========
GENERAL PARTNER (1%) - net income $ 156 $ 743
======= ========
LIMITED PARTNERS (99%) - net income $15,531 $ 73,560
======= ========
NET INCOME PER UNIT $ 3.88 $ 18.39
======= ========
UNITS OUTSTANDING 4,040 4,040
======= ========
The accompanying condensed notes are an integral part of
these financial statements.
3
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
-------- --------
REVENUES:
Oil and gas sales $300,936 $525,961
Interest 5,649 5,801
-------- --------
$306,585 $531,762
COSTS AND EXPENSES:
Oil and gas production $ 78,222 $107,005
Depreciation, depletion, and
amortization of oil and gas
properties 62,755 90,589
General and administrative
(Note 2) 51,764 55,296
-------- --------
$192,741 $252,890
-------- --------
NET INCOME $113,844 $278,872
======== ========
GENERAL PARTNER (1%) - net income $ 1,138 $ 2,789
======== ========
LIMITED PARTNERS (99%) - net income $112,706 $276,083
======== ========
NET INCOME PER UNIT $ 28.18 $ 69.03
======== ========
UNITS OUTSTANDING 4,040 4,040
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
4
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
--------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $113,844 $278,872
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 62,755 90,589
Decrease in accrued oil and
gas sales 52,053 60,946
Increase (decrease) in accounts
payable ( 27,859) 172
-------- --------
Net cash provided by operating
activities $200,793 $430,579
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of oil and
gas properties $ 49,889 $ 3,050
Additions to oil and gas
properties ( 6,395) ( 2,319)
-------- --------
Net cash provided by investing
activities $ 43,494 $ 731
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($424,200) ($565,600)
-------- --------
Net cash used by financing
activities ($424,200) ($565,600)
-------- --------
NET DECREASE IN CASH AND CASH
EQUIVALENTS ($179,913) ($134,290)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 197,606 227,376
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 17,693 $ 93,086
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
5
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, December 31,
1998 1997
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 49,654 $268,020
Accrued oil and gas sales 167,830 126,291
-------- --------
Total current assets $217,484 $394,311
NET OIL AND GAS PROPERTIES, utilizing
the full cost method 157,779 266,773
DEFERRED CHARGE 75,520 75,520
-------- --------
$450,783 $736,604
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $160,448 $ 39,922
Gas imbalance payable 7,094 71,205
-------- --------
Total current liabilities $167,542 $111,127
ACCRUED LIABILITY $133,166 $133,166
PARTNERS' CAPITAL:
General Partner, issued and
outstanding, 59 units $ 1,500 $ 4,923
Limited Partners, issued and
outstanding, 5,000 units 148,575 487,388
-------- --------
Total Partners' capital $150,075 $492,311
-------- --------
$450,783 $736,604
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
6
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
-------- ---------
REVENUES:
Oil and gas sales $83,034 $119,563
Interest 3,073 3,063
------- --------
$86,107 $122,626
COSTS AND EXPENSES:
Oil and gas production $26,225 $ 33,644
Depreciation, depletion, and
amortization of oil and gas
properties 28,377 9,131
General and administrative
(Note 2) 23,037 24,077
------- --------
$77,639 $ 66,852
------- --------
NET INCOME $ 8,468 $ 55,774
======= ========
GENERAL PARTNER (1%) - net income $ 84 $ 558
======= ========
LIMITED PARTNERS (99%) - net income $ 8,384 $ 55,216
======= ========
NET INCOME PER UNIT $ 1.67 $ 11.02
======= ========
UNITS OUTSTANDING 5,059 5,059
======= ========
The accompanying condensed notes are an integral part of
these financial statements.
7
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
-------- ---------
REVENUES:
Oil and gas sales $537,758 $612,959
Interest 11,603 10,542
-------- --------
$549,361 $623,501
COSTS AND EXPENSES:
Oil and gas production $ 96,187 $118,366
Depreciation, depletion, and
amortization of oil and gas
properties 86,675 78,970
General and administrative
(Note 2) 76,360 80,750
-------- --------
$259,222 $278,086
-------- --------
NET INCOME $290,139 $345,415
======== ========
GENERAL PARTNER (1%) - net income $ 2,901 $ 3,454
======== ========
LIMITED PARTNERS (99%) - net income $287,238 $341,961
======== ========
NET INCOME PER UNIT $ 57.35 $ 68.28
======== ========
UNITS OUTSTANDING 5,059 5,059
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
8
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(Unaudited)
1998 1997
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $290,139 $345,415
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 86,675 78,970
(Increase) decrease in accrued
oil and gas sales ( 41,539) 66,149
Increase (decrease) in accounts
payable 120,526 ( 2,905)
Decrease in gas imbalance payable ( 64,111) -
-------- --------
Net cash provided by operating
activities $391,690 $487,629
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of oil and
gas properties $ 27,869 $ 14,207
Additions to oil and gas
properties ( 5,550) ( 2,415)
-------- --------
Net cash provided by investing
activities $ 22,319 $ 11,792
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($632,375) ($581,785)
-------- --------
Net cash used by financing
activities ($632,375) ($581,785)
-------- --------
NET DECREASE IN CASH AND CASH
EQUIVALENTS ($218,366) ($ 82,364)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 268,020 369,731
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 49,654 $287,367
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
9
<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
CONDENSED NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The balance sheets as of September 30, 1998, statements of operations for
the three and nine months ended September 30, 1998 and 1997, and
statements of cash flows for the nine months ended September 30, 1998 and
1997 have been prepared by Dyco Petroleum Corporation ("Dyco"), the
General Partner of the Dyco Oil and Gas Program 1980-1 and 1980-2 Limited
Partnerships (individually, the "1980-1 Program" or the "1980-2 Program",
as the case may be, or, collectively, the "Programs"), without audit. In
the opinion of management all adjustments (which include only normal
recurring adjustments) necessary to present fairly the financial position
at September 30, 1998, results of operations for the three and nine months
ended September 30, 1998 and 1997, and changes in cash flows for the nine
months ended September 30, 1998 and 1997 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 Programs' Annual Report on Form 10-K for
the year ended December 31, 1997. The results of operations for the period
ended September 30, 1998 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. The Programs' calculation of depreciation, depletion, and
amortization includes estimated future expenditures to be incurred in
developing proved reserves and estimated dismantlement and abandonment
costs, net of estimated salvage values. In the event the unamortized cost
of oil and gas properties being amortized exceeds the full cost ceiling
10
<PAGE>
(as defined by the Securities and Exchange Commission), the excess is
charged to expense in the period during which such excess occurs. 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 period 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.
2. TRANSACTIONS WITH RELATED PARTIES
---------------------------------
Under the terms of each 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 three months ended September 30, 1998
and 1997, the 1980-1 Program incurred such expenses totaling $15,325 and
$16,157, respectively, of which $14,022 was paid each period to Dyco and
its affiliates. During the nine months ended September 30, 1998 and 1997
the 1980-1 Program incurred such expenses totaling $51,764 and $55,296,
respectively, of which $42,066 was paid each period to Dyco and its
affiliates. During the three months ended September 30, 1998 and 1997, the
1980-2 Program incurred such expenses totaling $23,037 and $24,077,
respectively, of which $21,405 was paid each period to Dyco and its
affiliates. During the nine months ended September 30, 1998 and 1997 the
1980-2 Program incurred such expenses totaling $76,360 and $80,750
respectively, of which $64,215 was paid each period to Dyco and its
affiliates.
Affiliates of the Programs operate certain of the Programs' properties.
Their policy is to bill the Programs for all customary charges and cost
reimbursements associated with these activities.
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
USE OF FORWARD-LOOKING STATEMENTS AND ESTIMATES
- -----------------------------------------------
This Quarterly Report contains certain forward-looking statements. The
words "anticipate", "believe", "expect", "plan", "intend", "estimate",
"project", "could", "may" and similar expressions are intended to identify
forward-looking statements. Such statements reflect management's current
views with respect to future events and financial performance. This
Quarterly Report also includes certain information, which is, or is based
upon, estimates and assumptions. Such estimates and assumptions are
management's efforts to accurately reflect the condition and operation of
the Programs.
Use of forward-looking statements and estimates and assumptions involve
risks and uncertainties which include, but are not limited to, the
volatility of oil and gas prices, the uncertainty of reserve information,
the operating risk associated with oil and gas properties (including the
risk of personal injury, death, property damage, damage to the well or
producing reservoir, environmental contamination, and other operating
risks), the prospect of changing tax and regulatory laws, the availability
and capacity of processing and transportation facilities, the general
economic climate, the supply and price of foreign imports of oil and gas,
the level of consumer product demand, and the price and availability of
alternative fuels. Should one or more of these risks or uncertainties
occur or should estimates or underlying assumptions prove incorrect,
actual conditions or results may vary materially and adversely from those
stated, anticipated, believed, estimated, and otherwise indicated.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Net proceeds from the Programs' 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 Programs' reserves which
would result in a positive economic impact.
The Programs' available capital from subscriptions has been spent on oil
and gas drilling activities. There should be no further material capital
resource commitments in the future. The Programs have no debt commitments.
Cash for operational purposes will be provided by current oil and gas
production.
12
<PAGE>
The Programs' Statements of Cash Flows for the nine months ended September
30, 1998 include proceeds from the sale of oil and gas properties during
the first quarter of 1998. These proceeds were included in the Programs'
cash distributions paid in June 1998. It is possible that the Programs'
repurchase values and future cash distributions could decline as a result
of the disposition of these properties. On the other hand, the General
Partner believes there will be beneficial operating efficiencies related
to the Programs' remaining properties. This is primarily due to the fact
that the properties sold generally bore a higher ratio of operating
expenses as compared to reserves than the Programs' remaining properties.
RESULTS OF OPERATIONS
- ---------------------
GENERAL DISCUSSION
The following general discussion should be read in conjunction with the
analysis of results of operations provided below. The most important
variable affecting the Programs' revenues is the prices received for the
sale of oil and gas. Predicting future prices is very difficult.
Substantially all of the Programs' gas reserves are being sold in the
"spot market". Prices on the spot market are subject to wide seasonal and
regional pricing fluctuations due to the highly competitive nature of the
spot market. Such spot market sales are generally short-term in nature and
are dependent upon the obtaining of transportation services provided by
pipelines. In addition, crude oil prices are at or near their lowest level
in the past decade due primarily to the global surplus of crude oil.
Management is unable to predict whether future oil and gas prices will (i)
stabilize, (ii) increase, or (iii) decrease.
1980-1 PROGRAM
THREE MONTHS ENDED SEPTEMBER 30, 1998 AS COMPARED TO THE THREE MONTHS
ENDED SEPTEMBER 30, 1997.
Three Months Ended September 30,
--------------------------------
1998 1997
------- --------
Oil and gas sales $87,267 $150,705
Oil and gas production expenses $30,436 $ 42,212
Barrels produced 321 289
Mcf produced 52,278 66,111
Average price/Bbl $ 11.90 $ 17.85
Average price/Mcf $ 1.60 $ 2.20
13
<PAGE>
As shown in the table above, total oil and gas sales decreased $63,438
(42.1%) for the three months ended September 30, 1998 as compared to the
three months ended September 30, 1997. Of this decrease, approximately
$30,000 was related to a decrease in volumes of gas sold and approximately
$32,000 was related to a decrease in the average price of gas sold.
Volumes of oil sold increased 32 barrels, while volumes of gas sold
decreased 13,833 Mcf for the three months ended September 30, 1998 as
compared to the three months ended September 30, 1997. The decrease in the
volumes of gas sold resulted primarily from negative prior period volume
adjustments made by the purchasers on two wells during the three months
ended September 30, 1998. Average oil and gas prices decreased to $11.90
per barrel and $1.60 per Mcf, respectively, for the three months ended
September 30, 1998 from $17.85 per barrel and $2.20 per Mcf, respectively,
for the three months ended September 30, 1997.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $11,776 (27.9%) for the three months ended
September 30, 1998 as compared to the three months ended September 30,
1997. This decrease resulted primarily from (i) a decrease in production
taxes associated with the decrease in oil and gas sales and (ii) surface
repair expenses incurred on two wells during the three months ended
September 30, 1997. As a percentage of oil and gas sales, these expenses
increased to 34.9% for the three months ended September 30, 1998 from
28.0% for the three months ended September 30, 1997. This percentage
increase was primarily due to the decreases in the average prices of oil
and gas sold during the three months ended September 30, 1998 as compared
to the three months ended September 30, 1997.
Depreciation, depletion, and amortization of oil and gas properties
increased $7,789 (40.3 %) for the three months ended September 30, 1998 as
compared with the three months ended September 30, 1997. This increase
resulted primarily from a decrease in the oil and gas prices used in the
valuation of reserves at September 30, 1998 as compared to September 30,
1997. This increase was partially offset by (i) decreases which resulted
from significant upward revisions in the estimate of remaining gas
reserves at December 31, 1997 and (ii) the decrease in volumes of gas sold
during the nine months ended September 30, 1998 as compared to the nine
months ended September 30, 1997. As a percentage of oil and gas sales,
this expense increased to 31.1% for the three months ended September 30,
1998 from 12.8% for the three months ended September 30, 1997. This
percentage increase was primarily due to the decreases in the average
prices of oil and gas sold during the three months ended September 30,
1998 as compared with the three
14
<PAGE>
months ended September 30, 1997 and the dollar increase in depreciation,
depletion, and amortization.
General and administrative expenses decreased $832 (5.1%) for the three
months ended September 30, 1998 as compared to the three months ended
September 30, 1997. As a percentage of oil and gas sales, these expenses
increased to 17.6% for the three months ended September 30, 1998 from
10.7% for the three months ended September 30, 1997. This percentage
increase was primarily due to the decrease in oil and gas sales.
NINE MONTHS ENDED SEPTEMBER 30, 1998 AS COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 1997.
Nine Months Ended September 30,
-------------------------------
1998 1997
-------- --------
Oil and gas sales $300,936 $525,961
Oil and gas production expenses $ 78,222 $107,005
Barrels produced 1,142 1,246
Mcf produced 146,288 218,463
Average price/Bbl $ 13.36 $ 20.65
Average price/Mcf $ 1.95 $ 2.29
As shown in the table above, total oil and gas sales decreased $225,025
(42.8%) for the nine months ended September 30, 1998 as compared to the
nine months ended September 30, 1997. Of this decrease, approximately
$165,000 was related to a decrease in volumes of gas sold and
approximately $49,000 was related to a decrease in the average price of
gas sold. Volumes of oil and gas sold decreased 104 barrels and 72,175
Mcf, respectively, for the nine months ended September 30, 1998 as
compared to the nine months ended September 30, 1997. The decrease in the
volumes of gas sold resulted primarily from (i) positive prior period
volume adjustments made by the purchasers on two wells during the nine
months ended September 30 1997, (ii) the 1980-1 Program receiving a
reduced percentage of sales on one well during the nine months ended
September 30, 1998 due to the 1980-1 Program's overproduced position in
that well, and (iii) negative prior period volume adjustments made by the
purchasers on two wells during the nine months ended September 30, 1998.
Average oil and gas prices decreased to $13.36 per barrel and $1.95 per
Mcf, respectively, for the nine months ended September 30, 1998 from
$20.65 per barrel and $2.29 per Mcf, respectively, for the nine months
ended September 30, 1997.
15
<PAGE>
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $28,783 (26.9%) for the nine months ended
September 30, 1998 as compared to the nine months ended September 30,
1997. This decrease resulted primarily from a decrease in production taxes
associated with the decrease in oil and gas sales and surface repair
expenses incurred on two wells during the nine months ended September 30,
1997. As a percentage of oil and gas sales, these expenses increased to
26.0% for the nine months ended September 30, 1998 from 20.3% for the nine
months ended September 30, 1997. This percentage increase was primarily
due to the decreases in the average prices of oil and gas sold during the
nine months ended September 30, 1998 as compared to the nine months ended
September 30, 1997.
Depreciation, depletion, and amortization of oil and gas properties
decreased $27,834 (30.7%) for the nine months ended September 30, 1998 as
compared to the nine months ended September 30, 1997. This decrease
resulted primarily from (i) decreases in the volumes of oil and gas sold
during the nine months ended September 30, 1998 as compared to the nine
months ended September 30, 1997 and (ii) significant upward revisions in
the estimate of remaining gas reserves at December 31, 1997. As a
percentage of oil and gas sales, these expenses increased to 20.9% for the
nine months ended September 30, 1998 from 17.2% for the nine months ended
September 30, 1997. This percentage increase was primarily due to the
decreases in the average prices of oil and gas sold for the nine months
ended September 30, 1998 as compared to the nine months ended September
30, 1997.
General and administrative expenses decreased $3,532 (6.4%) for the nine
months ended September 30, 1998 as compared to the nine months ended
September 30, 1997. As a percentage of oil and gas sales, these expenses
increased to 17.2% for the nine months ended September 30, 1998 from 10.5%
for the nine months ended September 30, 1997. This percentage increase was
primarily due to the decrease in oil and gas sales.
16
<PAGE>
1980-2 PROGRAM
THREE MONTHS ENDED SEPTEMBER 30, 1998 AS COMPARED TO THE THREE MONTHS
ENDED SEPTEMBER 30, 1997.
Three Months Ended September 30,
--------------------------------
1998 1997
------- --------
Oil and gas sales $83,034 $119,563
Oil and gas production expenses $26,225 $ 33,644
Barrels produced 354 102
Mcf produced 58,799 58,414
Average price/Bbl $ 13.51 $ 16.33
Average price/Mcf $ 1.33 $ 2.02
As shown in the table above, total oil and gas sales decreased $36,529
(30.6%) for the three months ended September 30, 1998 as compared to the
three months ended September 30, 1997. Of this decrease, approximately
$40,000 was related to a decrease in the average price of gas sold, which
decrease was partially offset by an increase of approximately $4,000
related to an increase in volumes of oil sold. Volumes of oil and gas sold
increased 252 barrels and 385 Mcf, respectively, for the three months
ended September 30, 1998 as compared to the three months ended September
30, 1997. The increase in the volumes of oil sold resulted primarily from
a positive prior period volume adjustment made by the purchaser on one
well during the three months ended September 30, 1998. Average oil and gas
prices decreased to $13.51 per barrel and $1.33 per Mcf, respectively, for
the three months ended September 30, 1998 from $16.33 per barrel and $2.02
per Mcf, respectively, for the three months ended September 30, 1997.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $7,419 (22.1%) for the three months ended
September 30, 1998 as compared to the three months ended September 30,
1997. This decrease resulted primarily from a negative prior period
production tax adjustment on one well during the three months ended
September 30, 1998. As a percentage of oil and gas sales, these expenses
increased to 31.6% for the three months ended September 30, 1998 from
28.1% for the three months ended September 30, 1997. This percentage
increase was primarily due to the decreases in the average prices of oil
and gas sold during the three months ended September 30, 1998 as compared
to the three months ended September 30, 1997.
17
<PAGE>
Depreciation, depletion, and amortization of oil and gas properties
increased $19,246 (210.8%) for the three months ended September 30, 1998
as compared to the three months ended September 30, 1997. This increase
resulted primarily from a decrease in the oil and gas prices used in the
valuation of reserves at September 30, 1998 as compared to September 30,
1997. As a percentage of oil and gas sales, this expense increased to
34.2% for the three months ended September 30, 1998 from 7.6% for the
three months ended September 30, 1997. This percentage increase was
primarily due to the dollar increase in depreciation, depletion, and
amortization and the decreases in the average prices of oil and gas sold
during the three months ended September 30, 1998 as compared to the three
months ended September 30, 1997.
General and administrative expenses decreased $1,040 (4.3%) for the three
months ended September 30, 1998 as compared to the three months ended
September 30, 1997. As a percentage of oil and gas sales, these expenses
increased to 27.7% for the three months ended September 30, 1998 from
20.1% for the three months ended September 30, 1997. This percentage
increase was primarily due to the decrease in oil and gas sales discussed
above.
NINE MONTHS ENDED SEPTEMBER 30, 1998 AS COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 1997.
Nine Months Ended September 30,
-------------------------------
1998 1997
-------- --------
Oil and gas sales $537,758 $612,959
Oil and gas production expenses $ 96,187 $118,366
Barrels produced 1,071 830
Mcf produced 280,990 279,518
Average price/Bbl $ 14.02 $ 20.95
Average price/Mcf $ 1.86 $ 2.13
As shown in the table above, total oil and gas sales decreased $75,201
(12.3%) for the nine months ended September 30, 1998 as compared to the
nine months ended September 30, 1997. Of this decrease, approximately
$76,000 was related to a decrease in the average price of gas sold.
Volumes of oil and gas sold increased 241 barrels and 1,472 Mcf,
respectively, for the nine months ended September 30, 1998 as compared to
the nine months ended September 30, 1997. The increase in the volumes of
oil sold resulted
18
<PAGE>
primarily from a positive prior period volume adjustment made by the
purchaser on one well during the nine months ended September 30, 1998.
Average oil and gas prices decreased to $14.02 per barrel and $1.86 per
Mcf, respectively, for the nine months ended September 30, 1998 from
$20.95 per barrel and $2.13 per Mcf, respectively, for the nine months
ended September 30, 1997.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $22,179 (18.7%) for the nine months ended
September 30, 1998 as compared to the nine months ended September 30,
1997. This decrease resulted primarily from (i) workover expenses incurred
during the nine months ended September 30, 1997 to improve the recovery of
reserves, (ii) a refund of ad valorem taxes received during the nine
months ended September 30, 1998, and (iii) surface repair expenses
incurred during the nine months ended September 30, 1997. As a percentage
of oil and gas sales, these expenses decreased to 17.9% for the nine
months ended September 30, 1998 from 19.3% for the nine months ended
September 30, 1997. This percentage decrease was primarily due to the
dollar decrease in production expenses discussed above, partially offset
by the decreases in the average prices of oil and gas sold for the nine
months ended September 30, 1998 as compared to the nine months ended
September 30, 1997.
Depreciation, depletion, and amortization of oil and gas properties
increased $7,705 (9.8%) for the nine months ended September 30, 1998 as
compared to the nine months ended September 30, 1997. This increase
resulted primarily from a decrease in the oil and gas prices used in the
valuation of reserves at September 30, 1998 as compared to September 30,
1997, which increase was partially offset by a decrease resulting from
significant upward revisions in gas reserve estimates at December 31,
1997. As a percentage of oil and gas sales, this expense increased to
16.1.% for the nine months ended September 30, 1998 from 12.9% for the
nine months ended September 30, 1997. This percentage increase was
primarily due to the decreases in the average prices of oil and gas sold
for the nine months ended September 30, 1998 as compared to the nine
months ended September 30, 1997.
General and administrative expenses decreased $4,390 (5.4%) for the nine
months ended September 30, 1998 as compared to the nine months ended
September 30, 1997. As a percentage of oil and gas sales, these expenses
increased to 14.2% for the nine months ended September 30, 1998 from 13.2%
for the nine months ended September 30, 1997.
19
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27.1 Financial Data Schedule containing summary financial
information extracted from the 1980-1 Program's
financial statements as of September 30, 1998 and for
the nine months ended September 30, 1998, filed
herewith.
27.2 Financial Data Schedule containing summary financial
information extracted from the 1980-2 Program's
financial statements as of September 30, 1998 and for
the nine months ended September 30, 1998, filed
herewith.
All other exhibits are omitted as inapplicable.
(b) Reports on Form 8-K.
None.
20
<PAGE>
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 1980-1 LIMITED
PARTNERSHIP
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED
PARTNERSHIP
(Registrant)
BY: DYCO PETROLEUM CORPORATION
General Partner
Date: November 4, 1998 By: /s/Dennis R. Neill
-------------------------------
(Signature)
Dennis R. Neill
President
Date: November 4, 1998 By: /s/Patrick M. Hall
-------------------------------
(Signature)
Patrick M. Hall
Chief Financial Officer
21
<PAGE>
INDEX TO EXHIBITS
NUMBER DESCRIPTION
- ------ -----------
27.1 Financial Data Schedule containing summary financial information
extracted from the Dyco Oil and Gas Program 1980-1 Limited
Partnership's financial statements as of September 30, 1998 and for
the nine months ended September 30, 1998, filed herewith.
27.2 Financial Data Schedule containing summary financial information
extracted from the Dyco Oil and Gas Program 1980-2 Limited
Partnership's financial statements as of September 30, 1998 and for
the nine months ended September 30, 1998, filed herewith.
All other exhibits are omitted as inapplicable.
22
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000806576
<NAME> DYCO OIL & GAS PROGRAM 1980-1 LIMITED PTRSHP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 17,693
<SECURITIES> 0
<RECEIVABLES> 46,262
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 63,955
<PP&E> 29,703,690
<DEPRECIATION> 29,338,076
<TOTAL-ASSETS> 555,959
<CURRENT-LIABILITIES> 17,943
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 493,437
<TOTAL-LIABILITY-AND-EQUITY> 555,959
<SALES> 300,936
<TOTAL-REVENUES> 306,585
<CGS> 0
<TOTAL-COSTS> 192,741
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 113,844
<INCOME-TAX> 0
<INCOME-CONTINUING> 113,844
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 113,844
<EPS-PRIMARY> 28.18
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000806577
<NAME> DYCO OIL & GAS PROGRAM 1980-2 LIMITED PTRSHP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 49,654
<SECURITIES> 0
<RECEIVABLES> 167,830
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 217,484
<PP&E> 35,369,013
<DEPRECIATION> 35,211,234
<TOTAL-ASSETS> 450,783
<CURRENT-LIABILITIES> 167,542
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 150,075
<TOTAL-LIABILITY-AND-EQUITY> 450,783
<SALES> 537,758
<TOTAL-REVENUES> 549,361
<CGS> 0
<TOTAL-COSTS> 259,222
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 290,139
<INCOME-TAX> 0
<INCOME-CONTINUING> 290,139
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 290,139
<EPS-PRIMARY> 57.35
<EPS-DILUTED> 0
</TABLE>
