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, 2000 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
------ ------
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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,
2000 1999
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 77,985 $ 44,620
Accrued oil and gas sales 101,383 66,174
-------- --------
Total current assets $179,368 $110,794
NET OIL AND GAS PROPERTIES, utilizing
the full cost method 261,677 309,760
DEFERRED CHARGE 55,502 55,502
-------- --------
$496,547 $476,056
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $ 4,371 $ 5,712
Gas imbalance payable 8,697 8,697
-------- --------
Total current liabilities $ 13,068 $ 14,409
ACCRUED LIABILITY $ 39,310 $ 39,310
PARTNERS' CAPITAL:
General Partner, 40 general
partner units $ 4,442 $ 4,223
Limited Partners, issued and
outstanding, 4,000 Units 439,727 418,114
-------- --------
Total Partners' capital $444,169 $422,337
-------- --------
$496,547 $476,056
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
2000 1999
-------- -------
REVENUES:
Oil and gas sales $180,960 $101,078
Interest 853 524
-------- --------
$181,813 $101,602
COSTS AND EXPENSES:
Oil and gas production $ 37,020 $ 22,672
Depreciation, depletion, and
amortization of oil and gas
properties 12,202 8,125
General and administrative
(Note 2) 19,494 15,259
-------- --------
$ 68,716 $ 46,056
-------- --------
NET INCOME $113,097 $ 55,546
======== ========
GENERAL PARTNER (1%) - net income $ 1,131 $ 555
======== ========
LIMITED PARTNERS (99%) - net income $111,966 $ 54,991
======== ========
NET INCOME PER UNIT $ 27.99 $ 13.75
======== ========
UNITS OUTSTANDING 4,040 4,040
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
2000 1999
-------- --------
REVENUES:
Oil and gas sales $415,297 $240,172
Interest 3,375 2,784
-------- --------
$418,672 $242,956
COSTS AND EXPENSES:
Oil and gas production $ 81,639 $ 66,081
Depreciation, depletion, and
amortization of oil and gas
properties 29,849 31,550
General and administrative
(Note 2) 63,152 50,594
-------- --------
$174,640 $148,225
-------- --------
NET INCOME $244,032 $ 94,731
======== ========
GENERAL PARTNER (1%) - net income $ 2,441 $ 947
======== ========
LIMITED PARTNERS (99%) - net income $241,591 $ 93,784
======== ========
NET INCOME PER UNIT $ 60.40 $ 23.45
======== ========
UNITS OUTSTANDING 4,040 4,040
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-1 LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
2000 1999
--------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $244,032 $ 94,731
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 29,849 31,550
Increase in accrued oil and gas
gas sales ( 35,209) ( 16,110)
Decrease in accounts receivable -
related party - 6,216
Increase in deferred charge - ( 1,007)
Increase (decrease) in accounts
payable ( 1,341) 746
Decrease in accrued liability - ( 547)
-------- --------
Net cash provided by operating
activities $237,331 $115,579
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of oil and
gas properties $ 18,234 $ 51,472
Additions to oil and gas
properties - ( 1)
-------- --------
Net cash provided by investing
activities $ 18,234 $ 51,471
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($222,200) ($141,400)
-------- --------
Net cash used by financing
activities ($222,200) ($141,400)
-------- --------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 33,365 $ 25,650
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 44,620 57,478
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 77,985 $ 83,128
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, December 31,
2000 1999
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $124,567 $ 52,257
Accrued oil and gas sales 149,913 91,782
-------- --------
Total current assets $274,480 $144,039
NET OIL AND GAS PROPERTIES, utilizing
the full cost method 113,302 134,686
DEFERRED CHARGE 48,100 48,100
-------- --------
$435,882 $326,825
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $ 5,824 $ 8,842
Gas imbalance payable 20,136 20,136
-------- --------
Total current liabilities $ 25,960 $ 28,978
ACCRUED LIABILITY $117,808 $117,808
PARTNERS' CAPITAL:
General Partner, 59 general
partner units $ 2,921 $ 1,801
Limited Partners, issued and
outstanding, 5,000 Units 289,193 178,238
-------- --------
Total Partners' capital $292,114 $180,039
-------- --------
$435,882 $326,825
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
2000 1999
-------- ---------
REVENUES:
Oil and gas sales $220,186 $157,536
Interest 1,373 1,464
-------- --------
$221,559 $159,000
COSTS AND EXPENSES:
Oil and gas production $ 42,037 $ 34,669
Depreciation, depletion, and
amortization of oil and gas
properties 7,147 5,623
General and administrative
(Note 2) 24,663 22,953
-------- --------
$ 73,847 $ 63,245
-------- --------
NET INCOME $147,712 $ 95,755
======== ========
GENERAL PARTNER (1%) - net income $ 1,477 $ 958
======== ========
LIMITED PARTNERS (99%) - net income $146,235 $ 94,797
======== ========
NET INCOME PER UNIT $ 29.19 $ 18.93
======== ========
UNITS OUTSTANDING 5,059 5,059
======== ========
The accompanying condensed notes are an
integral part of these financial statements.
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<PAGE>
DYCO OIL AND GAS PROGRAM 1980-2 LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
2000 1999
-------- ---------
REVENUES:
Oil and gas sales $573,892 $421,401
Interest 4,575 2,996
-------- --------
$578,467 $424,397
COSTS AND EXPENSES:
Oil and gas production $114,732 $ 95,247
Depreciation, depletion, and
amortization of oil and gas
properties 20,402 28,514
General and administrative
(Note 2) 78,308 75,047
-------- --------
$213,442 $198,808
-------- --------
NET INCOME $365,025 $225,589
======== ========
GENERAL PARTNER (1%) - net income $ 3,650 $ 2,256
======== ========
LIMITED PARTNERS (99%) - net income $361,375 $223,333
======== ========
NET INCOME PER UNIT $ 72.15 $ 44.59
======== ========
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, 2000 AND 1999
(Unaudited)
2000 1999
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $365,025 $225,589
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 20,402 28,514
Increase in accrued oil and
gas sales ( 58,131) ( 22,511)
Increase (decrease) in accounts
payable ( 3,018) 1,318
-------- --------
Net cash provided by operating
activities $324,278 $232,910
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of oil and
gas properties $ 1,062 $ -
Additions to oil and gas
properties ( 80) ( 442)
-------- --------
Net cash provided (used) by
investing activities $ 982 ($ 442)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($252,950) ($227,655)
-------- --------
Net cash used by financing
activities ($252,950) ($227,655)
-------- --------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 72,310 $ 4,813
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 52,257 62,393
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $124,567 $ 67,206
======== ========
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, 2000
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The balance sheets as of September 30, 2000, statements of operations for
the three and nine months ended September 30, 2000 and 1999, and
statements of cash flows for the nine months ended September 30, 2000 and
1999 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, 2000, results of operations for the three and nine months
ended September 30, 2000 and 1999, and changes in cash flows for the nine
months ended September 30, 2000 and 1999 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, 1999. The results of operations for the period
ended September 30, 2000 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
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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 (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, 2000
and 1999, the 1980-1 Program incurred such expenses totaling $19,494 and
$15,259, respectively, of which $17,049 and $14,022, respectively, were
paid each period to Dyco and its affiliates. During the nine months ended
September 30, 2000 and 1999, the 1980-1 Program incurred such expenses
totaling $63,152 and $50,594, respectively, of which $51,147 and $42,066,
respectively, were paid each period to Dyco and its affiliates. During the
three months ended September 30, 2000 and 1999, the 1980-2 Program
incurred such expenses totaling $24,663 and $22,953, respectively, of
which $21,840 and $21,405, respectively, were paid each period to Dyco and
its affiliates. During the nine months ended September 30, 2000 and 1999,
the 1980-2 Program incurred such expenses totaling $78,308 and $75,047,
respectively, of which $65,520
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<PAGE>
and $64,215, respectively, were 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.
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<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
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<PAGE>
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.
Management believes that cash for ordinary operational purposes will be
provided by current oil and gas production.
The 1980-1 Program's Statement of Cash Flows for the nine months ended
September 30, 2000 includes proceeds from the sale of oil and gas
properties during the second quarter of 2000. These proceeds were included
in the 1980-1 Program's cash distributions paid in June 2000.
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
variables affecting the Programs' revenues are the prices received for the
sale of oil and gas and the volumes of oil and gas produced. The Program's
production is mainly natural gas, so such pricing and volumes are the most
significant factors.
Due to the volatility of oil and gas prices, forecasting future prices is
subject to great uncertainty and inaccuracy. 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. It is likewise
difficult to predict production volumes. However, oil and gas are
depleting assets, so it can be expected that production levels will
decline over time. Recent gas prices have been significantly higher than
the Program's historical average. This is attributable to the higher
prices for crude oil, a substitute fuel in some markets, and reduced
production due to lower capital investments in 1998 and 1999.
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<PAGE>
1980-1 PROGRAM
THREE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THE THREE MONTHS ENDED
SEPTEMBER 30, 1999.
Three Months Ended September 30,
--------------------------------
2000 1999
-------- --------
Oil and gas sales $180,960 $101,078
Oil and gas production expenses $ 37,020 $ 22,672
Barrels produced 490 296
Mcf produced 45,180 38,265
Average price/Bbl $ 24.85 $ 19.33
Average price/Mcf $ 3.74 $ 2.49
As shown in the table above, total oil and gas sales increased $79,882
(79.0%) for the three months ended September 30, 2000 as compared to the
three months ended September 30, 1999. Of this increase, approximately
$56,000 was related to an increase in the average price of gas sold and
approximately $17,000 was related to an increase in volumes of gas sold.
Volumes of oil and gas sold increased 194 barrels and 6,915 Mcf,
respectively, for the three months ended September 30, 2000 as compared to
the three months ended September 30, 1999. The increase in volumes of gas
sold was primarily due to a positive prior period volume adjustment made
by the purchaser on one well during the three months ended September 30,
2000. Average oil and gas prices increased to $24.85 per barrel and $3.74
per Mcf, respectively, for the three months ended September 30, 2000 from
$19.33 per barrel and $2.49 per Mcf, respectively, for the three months
ended September 30, 1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $14,348 (63.3%) for the three months ended
September 30, 2000 as compared to the
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<PAGE>
three months ended September 30, 1999. This increase was primarily due to
(i) a prior period lease operating expense adjustment made by the operator
on several wells during the three months ended September 30, 2000 and (ii)
an increase in production taxes associated with the increase in oil and
gas sales. As a percentage of oil and gas sales, these expenses decreased
to 20.5% for the three months ended September 30, 2000 from 22.4% for the
three months ended September 30, 1999. This percentage decrease was
primarily due to the increases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $4,077 (50.2%) for the three months ended September 30, 2000 as
compared to the three months ended September 30, 1999. This increase was
primarily due to (i) the decreased dollar amount of depreciation,
depletion, and amortization charged during the third quarter of 1999 which
resulted from significant increases in the oil and gas prices used in the
valuation of remaining reserves at September 30, 1999 as compared to June
30, 1999 and (ii) the increase in volumes of oil and gas sold. As a
percentage of oil and gas sales, this expense decreased to 6.7% for the
three months ended September 30, 2000 from 8.0% for the three months ended
September 30, 1999. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
General and administrative expenses increased $4,235 (27.8%) for the three
months ended September 30, 2000 as compared to the three months ended
September 30, 1999. This increase was primarily due to a change in
allocation among the 1980-1 Program and other affiliated programs of
indirect general and administrative expenses reimbursed to the General
Partner. As a percentage of oil and gas sales, these expenses decreased to
10.8% for the three months ended September 30, 2000 from 15.1% for the
three months ended September 30, 1999. This percentage decrease was
primarily due to the increase in oil and gas sales.
NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 1999.
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<PAGE>
Nine Months Ended September 30,
-------------------------------
2000 1999
-------- --------
Oil and gas sales $415,297 $240,172
Oil and gas production expenses $ 81,639 $ 66,081
Barrels produced 1,046 1,035
Mcf produced 120,597 107,105
Average price/Bbl $ 26.39 $ 15.04
Average price/Mcf $ 3.21 $ 2.10
As shown in the table above, total oil and gas sales increased $175,125
(72.9%) for the nine months ended September 30, 2000 as compared to the
nine months ended September 30, 1999. Of this increase, approximately
$135,000 was related to an increase in the average price of gas sold and
approximately $28,000 was related to an increase in volumes of gas sold.
Volumes of oil and gas sold increased 11 barrels and 13,492 Mcf,
respectively, for the nine months ended September 30, 2000 as compared to
the nine months ended September 30, 1999. The increase in volumes of gas
sold was primarily due to (i) a positive prior period volume adjustment
made by the purchaser on one well during the nine months ended September
30, 2000 and (ii) the 1980-1 Program receiving an increased percentage of
sales on two wells due to gas balancing during the nine months ended
September 30, 2000. Average oil and gas prices increased to $26.39 per
barrel and $3.21 per Mcf, respectively, for the nine months ended
September 30, 2000 from $15.04 per barrel and $2.10 per Mcf, respectively,
for the nine months ended September 30, 1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $15,558 (23.5%) for the nine months ended
September 30, 2000 as compared to the nine months ended September 30,
1999. This increase was primarily due to (i) an increase in production
taxes associated with the increase in oil and gas sales and (ii) a prior
period lease operating expense adjustment made by the operator on several
wells during the nine months ended September 30, 2000. As a percentage of
oil and gas sales, these expenses decreased to 19.7% for the nine months
ended September 30, 2000 from 27.5% for the nine months ended September
30, 1999. This percentage decrease was primarily due to the increases in
the average prices of oil and gas sold.
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<PAGE>
Depreciation, depletion, and amortization of oil and gas properties
decreased $1,701 (5.4%) for the nine months ended September 30, 2000 as
compared to the nine months ended September 30, 1999. This decrease was
primarily due to an increase in the oil and gas prices used in the
valuation of remaining reserves at September 30, 2000 as compared to
September 30, 1999. This decrease was partially offset by the increase in
volumes of gas sold. As a percentage of oil and gas sales, this expense
decreased to 7.2% for the nine months ended September 30, 2000 from 13.1%
for the nine months ended September 30, 1999. This percentage decrease was
primarily due to the increases in the average prices of oil and gas sold.
General and administrative expenses increased $12,558 (24.8%) for the nine
months ended September 30, 2000 as compared to the nine months ended
September 30, 1999. This increase was primarily due to a change in
allocation among the 1980-1 Program and other affiliated programs of
indirect general and administrative expenses reimbursed to the General
Partner. As a percentage of oil and gas sales, these expenses decreased to
15.2% for the nine months ended September 30, 2000 from 21.1% for the nine
months ended September 30, 1999. This percentage decrease was primarily
due to the increase in oil and gas sales.
1980-2 PROGRAM
THREE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THE THREE MONTHS ENDED
SEPTEMBER 30, 1999.
Three Months Ended September 30,
--------------------------------
2000 1999
-------- --------
Oil and gas sales $220,186 $157,536
Oil and gas production expenses $ 42,037 $ 34,669
Barrels produced 384 253
Mcf produced 51,826 59,119
Average price/Bbl $ 25.11 $ 21.25
Average price/Mcf $ 4.06 $ 2.57
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<PAGE>
As shown in the table above, total oil and gas sales increased $62,650
(39.8%) for the three months ended September 30, 2000 as compared to the
three months ended September 30, 1999. Of this increase, approximately
$77,000 was related to an increase in the average price of gas sold. This
increase was partially offset by a decrease of approximately $19,000
related to a decrease in volumes of gas sold. Volumes of oil sold
increased 131 barrels, while volumes of gas sold decreased 7,293 Mcf for
the three months ended September 30, 2000 as compared to the three months
ended September 30, 1999. The decrease in the volumes of gas sold was
primarily due to (i) the 1980-2 Program receiving an increased percentage
of sales on one well due to gas balancing during the three months ended
September 30, 1999 and (ii) normal declines in production. Average oil and
gas prices increased to $25.11 per barrel and $4.06 per Mcf, respectively,
for the three months ended September 30, 2000 from $21.25 per barrel and
$2.57 per Mcf, respectively, for the three months ended September 30,
1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $7,368 (21.3%) for the three months ended
September 30, 2000 as compared to the three months ended September 30,
1999. This increase was primarily due to (i) an increase in production
taxes associated with the increase in oil and gas sales and (ii) a prior
period lease operating expense adjustment made by the operator on several
wells during the three months ended September 30, 2000. These increases
were partially offset by ad valorem tax credits received on one well
during the three months ended September 30, 2000. As a percentage of oil
and gas sales, these expenses decreased to 19.1% for the three months
ended September 30, 2000 from 22.0% for the three months ended September
30, 1999. This percentage decrease was primarily due to the increases in
the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $1,524 (27.1%) for the three months ended September 30, 2000 as
compared to the three months ended September 30, 1999. This increase was
primarily due to the decreased dollar amount of depreciation, depletion,
and amortization charged during the third quarter of 1999 which resulted
from significant increases in the oil and gas prices used in the valuation
of remaining reserves at September 30, 1999 as compared to June 30, 1999.
As a
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percentage of oil and gas sales this expense decreased to 3.2% for the
three months ended September 30, 2000 from 3.6% for the three months ended
September 30, 1999. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
General and administrative expenses increased $1,710 (7.5%) for the three
months ended September 30, 2000 as compared to the three months ended
September 30, 1999. As a percentage of oil and gas sales, these expenses
decreased to 11.2% for the three months ended September 30, 2000 from
14.6% for the three months ended September 30, 1999. This percentage
decrease was primarily due to the increase in oil and gas sales.
NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 1999.
Nine Months Ended September 30,
-------------------------------
2000 1999
-------- --------
Oil and gas sales $573,892 $421,401
Oil and gas production expenses $114,732 $ 95,247
Barrels produced 666 881
Mcf produced 173,425 203,055
Average price/Bbl $ 26.27 $ 15.91
Average price/Mcf $ 3.21 $ 2.01
As shown in the table above, total oil and gas sales increased $152,491
(36.2%) for the nine months ended September 30, 2000 as compared to the
nine months ended September 30, 1999. Of this increase, approximately
$208,000 was related to an increase in the average price of gas sold. This
increase was partially offset by a decrease of approximately $59,000
related to a decrease in volumes of gas sold. Volumes of oil and gas sold
decreased 215 barrels and 29,630 Mcf, respectively, for the nine months
ended September 30, 2000 as compared to the nine months ended September
30, 1999. The decrease in volumes of gas sold was primarily due to (i) the
1980-2 Program receiving an increased percentage of sales on one well due
to gas balancing during the nine months ended September 30, 1999 and (ii)
normal declines in production. Average oil and gas prices increased to
$26.27 per barrel and $3.21 per Mcf, respectively, for the nine months
ended September 30, 2000
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<PAGE>
from $15.91 per barrel and $2.01 per Mcf, respectively, for the nine
months ended September 30, 1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $19,485 (20.5%) for the nine months ended
September 30, 2000 as compared to the nine months ended September 30,
1999. This increase was primarily due to (i) workover expenses incurred on
one well during the nine months ended September 30, 2000 to improve the
recovery of reserves and (ii) an increase in production taxes associated
with the increase in oil and gas sales. As a percentage of oil and gas
sales, these expenses decreased to 20.0% for the nine months ended
September 30, 2000 from 22.6% for the nine months ended September 30,
1999. This percentage decrease was primarily due to the increases in the
average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $8,112 (28.4%) for the nine months ended September 30, 2000 as
compared to the nine months ended September 30, 1999. This decrease was
primarily due to (i) an increase in the oil and gas prices used in the
valuation of remaining reserves at September 30, 2000 as compared to
September 30, 1999 and (ii) a decrease in volumes of oil and gas sold. As
a percentage of oil and gas sales, this expense decreased to 3.6% for the
nine months ended September 30, 2000 from 6.8% for the nine months ended
September 30, 1999. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
General and administrative expenses increased $3,261 (4.3%) for the nine
months ended September 30, 2000 as compared to the nine months ended
September 30, 1999. As a percentage of oil and gas sales, these expenses
decreased to 13.6% for the nine months ended September 30, 2000 from 17.8%
for the nine months ended September 30, 1999. This percentage decrease was
primarily due to the increase in oil and gas sales.
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<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
The Programs do not hold any market risk sensitive instruments.
-22-
<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, 2000 and for
the nine months ended September 30, 2000, filed
herewith.
27.2 Financial Data Schedule containing summary financial
information extracted from the 1980-2 Program's
financial statements as of September 30, 2000 and for
the nine months ended September 30, 2000, filed
herewith.
All other exhibits are omitted as inapplicable.
(b) Reports on Form 8-K.
None.
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<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 8, 2000 By: /s/Dennis R. Neill
-------------------------------
(Signature)
Dennis R. Neill
President
Date: November 8, 2000 By: /s/Patrick M. Hall
-------------------------------
(Signature)
Patrick M. Hall
Chief Financial Officer
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<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, 2000 and for
the nine months ended September 30, 2000, 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, 2000 and for
the nine months ended September 30, 2000, filed herewith.
All other exhibits are omitted as inapplicable.
