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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number 0-16693
COASTAL 1987 DRILLING PROGRAM, LTD.
(Exact name of registrant as specified in its charter)
Texas 76-0214087
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Coastal Tower
Nine Greenway Plaza
Houston, Texas 77046-0995
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 877-1400
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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, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No _____
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<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The financial statements of the Coastal 1987 Drilling Program, Ltd., a
Texas limited partnership, (the "Program"), are presented herein and are
unaudited, except for balances as of December 31, 1995, and therefore are
subject to year-end adjustments; however, all adjustments which are of a normal
recurring nature and, in the opinion of management, necessary for a fair
statement of the results of operations for the periods covered have been made.
Such results are not necessarily indicative of results to be expected for the
year due to seasonal variations and market conditions affecting gas and oil
sales and corresponding unit prices.
COASTAL 1987 DRILLING PROGRAM, LTD.
BALANCE SHEET
(Thousands of Dollars)
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 1996 1995
------------ ------------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents.................................................... $ 15 $ 48
Accounts receivable - affiliates............................................. 102 122
--------- --------
Total Current Assets...................................................... 117 170
--------- --------
Gas and Oil Properties - at full-cost........................................... 17,759 17,751
Less accumulated depreciation and amortization............................... 16,881 16,828
--------- --------
878 923
--------- --------
$ 995 $ 1,093
========= ========
LIABILITIES AND PARTNERS' CAPITAL
Current Liabilities:
Accounts payable - affiliates................................................ $ 42 $ 98
Long-Term Liabilities:
Accounts payable - affiliate................................................. 79 86
Partners' Capital............................................................... 874 909
--------- --------
$ 995 $ 1,093
========= ========
</TABLE>
See Note to Financial Statements.
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<PAGE>
COASTAL 1987 DRILLING PROGRAM, LTD.
STATEMENT OF PARTNERS' CAPITAL
(Thousands of Dollars)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
----------------------------
1996 1995
----------- -----------
(Unaudited)
<S> <C> <C>
General Partner:
Balance, beginning of period................................................. $ 9 $ 11
Earnings (loss).............................................................. 1 -
Distributions................................................................ (1) -
----------- -----------
Balance, end of period..................................................... 9 11
----------- -----------
Limited Partners:
Balance, beginning of period................................................. 900 1,143
Earnings (loss).............................................................. 54 (9)
Distributions................................................................ (89) (60)
----------- -----------
Balance, end of period..................................................... 865 1,074
----------- -----------
$ 874 $ 1,085
=========== ===========
</TABLE>
STATEMENT OF OPERATIONS
(Thousands of Dollars, Except per Limited Partnership Unit)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------- -------------------------
1996 1995 1996 1995
---------- ----------- ----------- --------
(Unaudited)
<S> <C> <C> <C> <C>
Revenues:
Sale of gas and oil............................ $ 166 $ 157 $ 346 $ 330
Interest....................................... 1 12 1 13
---------- ----------- ----------- -----------
167 169 347 343
---------- ----------- ----------- -----------
Costs and Expenses:
Lease operating................................ 104 108 205 233
Administrative fee............................. 17 19 34 38
Depreciation and amortization.................. 24 39 53 81
---------- ----------- ----------- -----------
145 166 292 352
---------- ----------- ----------- -----------
Net Earnings (Loss)............................... $ 22 $ 3 $ 55 $ (9)
========== =========== =========== ===========
Net Earnings (Loss) Per Limited
Partnership Unit................................ $ 1.56 $ 0.21 $ 3.89 $ (0.64)
========== =========== =========== ===========
</TABLE>
See Note to Financial Statements.
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<PAGE>
COASTAL 1987 DRILLING PROGRAM, LTD.
STATEMENT OF CASH FLOWS
(Thousands of Dollars)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
----------------------------
1996 1995
----------- -----------
(Unaudited)
<S> <C> <C>
Cash Flows From Operating Activities:
Net earnings (loss).......................................................... $ 55 $ (9)
----------- -----------
Adjustments to reconcile net earnings (loss)
to net cash provided by operating activities:
Depreciation and amortization.......................................... 53 81
Decrease in accounts receivable - affiliates........................... 20 -
Decrease in accounts payable - affiliates.............................. (63) (18)
----------- -----------
Total adjustments................................................... 10 63
----------- -----------
Net cash provided by operating activities........................ 65 54
----------- -----------
Cash Flows From Investing Activities:
Capital expenditures......................................................... (8) (5)
Proceeds from the sale of property and equipment............................. - -
----------- -----------
Net cash used by investing activities..................................... (8) (5)
----------- -----------
Cash Flows From Financing Activities:
Distributions paid........................................................... 90 (60)
----------- -----------
Net decrease in cash and cash equivalents................................. (33) (11)
Cash and cash equivalents at beginning of the period...................... 48 40
----------- -----------
Cash and cash equivalents at end of the period............................ $ 15 $ 29
=========== ===========
</TABLE>
NOTE TO FINANCIAL STATEMENTS
For additional information relative to operations and financial position,
reference is made to the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995. For purposes of the Statement of Cash Flows, cash
equivalents include time deposits, certificates of deposit and all highly liquid
instruments with original maturities of three months or less.
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<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Liquidity and Capital Resources
The Partnership Payout balance was reduced by $57,000 in the second quarter
to $9,553,000 as of June 30, 1996, compared to the original balance of
$14,141,000 at the start of the Program. Partnership Payout will not have been
achieved at termination of the Partnership on January 1, 1997.
A cash distribution of $2.00 per limited partnership unit was made for the
second quarter of 1996, bringing total distributions since inception of the
Program to $230.30 per $1,000 unit.
The General Partner purchased all the 190 limited partnership units
tendered during the 1996 purchase offer period in accordance with the Agreement
of Limited Partnership.
Results of Operations
The Company's results of operations for the comparable three and six month
periods ended June 30, 1996 and 1995 are as follows:
Revenues from the sale of production in the second quarter of 1996
increased $9,000 (6%) over the 1995 second quarter. Natural gas revenues were up
$16,000 (36%) reflecting an increase in the net weighted average price of
natural gas to $2.02 per thousand cubic feet in the second quarter of 1996 from
$1.22 per thousand cubic feet in the second quarter of 1995 partially offset by
a decrease in production volumes to 28 million cubic feet in the 1996 second
quarter compared with 34 million cubic feet in the 1995 second quarter. Crude
oil, condensate and natural gas liquids revenues decreased $7,000 (6%),
reflecting a decrease in production volumes to 6,538 barrels from 6,923 barrels
partially offset by an increase in the net weighted average price of crude oil,
condensate and natural gas liquids to $16.64 per barrel in the 1996 second
quarter from $15.16 per barrel in the 1995 second quarter.
The decrease in natural gas volumes was primarily attributable to normal
production declines.
Lease operating expense decreased $4,000 (4%) primarily attributable to
decreased maintenance expenses. Administrative fee decreased $2,000 (11%) as a
result of a restructuring of the fee by the General Partner. Depreciation and
amortization expense decreased $15,000 (38%) primarily as a result of decreased
rates and decreased production volumes.
Revenues from the sale of production in the first half of 1996 increased
$16,000 (5%) over the 1995 first half. Natural gas revenues were up $11,000
(11%) as the average price, net of severance taxes, increased to $1.87 per
thousand cubic feet in the first six months of 1996 from $1.26 in the first half
of 1995, partially offset by a decrease in production volumes to 57 million
cubic feet in the first half of 1996 from 76 million cubic feet in the first
half of 1995. Crude oil, condensate and natural gas liquids revenues increased
$5,000 (2%), reflecting an increase in the weighted average price, net of
severance taxes, to $16.39 per barrel in the first half of 1996 from $14.89 per
barrel in the first half of 1995, partially offset by a decrease in production
volumes to 13,682 barrels in the first half of 1996 from 14,009 barrels in the
first half of 1995.
The decreases in natural gas production and crude oil, condensate and
natural gas liquids volumes in the first half of 1996 were primarily the result
of normal production declines.
Lease operating expense decreased $28,000 (12%) in the first half of 1996
due primarily to decreased operations and maintenance expenses. The
administrative fee decreased $4,000 (11%) in the first half of 1996 as a result
of a restructuring of the fee by the General Partner. Depreciation and
amortization decreased $28,000 (35%) in the same period primarily due to
decreased rates and decreased production volumes.
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<PAGE>
PART II -- OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
None.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the quarter ended
June 30, 1996.
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.
COASTAL 1987 DRILLING PROGRAM, LTD.
(Registrant)
By Its General Partner,
Coastal Limited Ventures, Inc.
Date: August 12, 1996 By: COBY C. HESSE
-----------------------------------
Coby C. Hesse
Senior Vice President
(As Authorized Officer and
Chief Accounting Officer)
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE COASTAL 1987 DRILLING PROGRAM, LTD.
FORM 10-Q QUARTERLY REPORT FOR THE PERIOD ENDED JUNE
30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 15
<SECURITIES> 0
<RECEIVABLES> 102
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 117
<PP&E> 17,759
<DEPRECIATION> 16,881
<TOTAL-ASSETS> 995
<CURRENT-LIABILITIES> 42
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 953
<TOTAL-LIABILITY-AND-EQUITY> 995
<SALES> 346
<TOTAL-REVENUES> 347
<CGS> 0
<TOTAL-COSTS> 292
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 55
<INCOME-TAX> 0
<INCOME-CONTINUING> 55
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
