<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
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 33-15998-01
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Texas 76-0254057
(State or other jurisdiction of organization) (I.R.S. Employer Identification No.)
</TABLE>
16825 Northchase Drive, Suite 400
Houston, Texas 77060
(Address of principal executive offices)
(Zip Code)
(281)874-2700
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year,
if changed since last report)
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
----
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE
<S> <C>
ITEM 1. Financial Statements
Balance Sheets
- September 30, 1999 and December 31, 1998 3
Statements of Operations
- Three month and nine month periods ended September 30, 1999 and 1998 4
Statements of Cash Flows
- Nine month periods ended September 30, 1999 and 1998 5
Notes to Financial Statements 6
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II. OTHER INFORMATION 12
SIGNATURES 13
</TABLE>
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
--------------- ---------------
(Unaudited)
<S> <C> <C>
ASSETS:
Current Assets:
Cash and cash equivalents $ 19,262 $ 7,673
Nonoperating interests income receivable 1,104 7,553
--------------- ---------------
Total Current Assets 20,366 15,226
--------------- ---------------
Nonoperating interests in oil and gas
properties, using full cost accounting 4,141,867 4,167,185
Less-Accumulated amortization (3,891,885) (3,879,249)
--------------- ---------------
249,982 287,936
=============== ===============
$ 270,348 $ 303,162
=============== ===============
LIABILITIES AND PARTNERS' CAPITAL:
Current Liabilities:
Accounts Payable $ 8,387 $ 715
--------------- ---------------
Limited Partners' Capital (47,703.63 Limited Partnership
Units; $100 per unit) 258,106 297,359
General Partners' Capital 3,855 5,088
--------------- ---------------
Total Partners' Capital 261,961 302,447
=============== ===============
$ 270,348 $ 303,162
=============== ===============
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------------- ---------------------------------
1999 1998 1999 1998
--------------- --------------- -------------- --------------
<S> <C> <C> <C> <C>
REVENUES:
Income from nonoperating interests $ 7,923 $ 16,530 $ 18,982 $ 41,671
Interest income 289 138 669 1,419
--------------- --------------- -------------- --------------
8,212 16,668 19,651 43,090
--------------- --------------- -------------- --------------
COSTS AND EXPENSES:
Amortization 4,350 32,867 12,636 50,496
General and administrative 4,968 5,231 21,544 24,771
--------------- --------------- -------------- --------------
9,318 38,098 34,180 75,267
=============== =============== ============== ==============
NET INCOME (LOSS) $ (1,106) $ (21,430) $ (14,529) $ (32,177)
=============== =============== ============== ==============
Limited Partners' net income (loss)
per unit $ (0.03) $ (0.45) $ (0.30) $ (0.67)
=============== =============== ============== ==============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-------------------------------------
1999 1998
--------------- ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Income (loss) $ (14,529) $ (32,177)
Adjustments to reconcile income (loss) to
net cash provided by operations:
Amortization 12,636 50,496
Change in assets and liabilities:
(Increase) decrease in nonoperating interests income receivable 6,449 (2,922)
Increase (decrease) in accounts payable 7,672 883
--------------- ---------------
Net cash provided by (used in) operating activities 12,228 16,280
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to nonoperating interests in oil and gas properties 1,147 (2,237)
Proceeds from sales of nonoperating interests in oil and gas properties 24,171 --
--------------- ---------------
Net cash provided by (used in) investing activities 25,318 (2,237)
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash Distributions to partners (25,957) (77,204)
--------------- ---------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 11,589 (63,161)
--------------- ---------------
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 7,673 71,415
=============== ===============
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 19,262 $ 8,254
=============== ===============
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) General Information -
The financial statements included herein have been prepared by
the Partnership and are unaudited except for the balance sheet at
December 31, 1998 which has been taken from the audited financial
statements at that date. The financial statements reflect adjustments,
all of which were of a normal recurring nature, which are, in the
opinion of the managing general partner necessary for a fair
presentation. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to the rules
and regulations of the Securities and Exchange Commission. The
Partnership believes adequate disclosure is provided by the information
presented. The financial statements should be read in conjunction with
the audited financial statements and the notes included in the latest
Form 10-K.
(2) Organization and Terms of Partnership Agreement -
Swift Energy Managed Pension Assets Partnership 1988-A, Ltd.,
a Texas limited partnership ("the Partnership"), was formed on June 2,
1988, for the purpose of purchasing net profits interest, overriding
royalty interests and royalty interests (collectively, "nonoperating
interests") in producing oil and gas properties within the continental
United States. Swift Energy Company ("Swift"), a Texas corporation, and
VJM Corporation ("VJM"), a California corporation, serve as Managing
General Partner and Special General Partner of the Partnership,
respectively. The general partners are required to contribute up to
1/99th of limited partner net contributions. The 426 limited partners
made total capital contributions of $4,770,363.
Nonoperating interests acquisition costs and the management
fee are borne 99 percent by the limited partners and one percent by the
general partners. Organization and syndication costs were borne solely
by the limited partners.
Generally, all continuing costs (including development costs,
operating costs, general and administrative reimbursements and direct
expenses) and revenues are allocated 90 percent to the limited partners
and ten percent to the general partners. If prior to partnership payout,
however, the cash distribution rate for a certain period equals or
exceeds 17.5 percent, then for the following calendar year, these
continuing costs and revenues will be allocated 85 percent to the
limited partners and 15 percent to the general partners. After
partnership payout, continuing costs and revenues will be shared 85
percent by the limited partners, and 15 percent by the general partners,
even if the cash distribution rate is less than 17.5 percent.
(3) Significant Accounting Policies -
Use of Estimates --
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from estimates.
Oil and Gas Revenues -
Oil and gas revenues are reported using the entitlement method
in which the Partnership recognizes its interest in oil and natural gas
production as revenue.
6
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Nonoperating Interests in Oil and Gas Properties --
The Partnership accounts for its ownership interest in oil and
gas properties using the proportionate consolidation method, whereby the
Partnership's share of assets, liabilities, revenues and expenses is
included in the appropriate classification in the financial statement.
For financial reporting purposes the Partnership follows the
"full-cost" method of accounting for nonoperating interests in oil and
gas property costs. Under this method of accounting, all costs incurred
in the acquisition of nonoperating interests in oil and gas properties
are capitalized. The unamortized cost of nonoperating interests in oil
and gas properties is limited to the "ceiling limitation" (calculated
separately for the Partnership, limited partners and general partners).
The "ceiling limitation" is calculated on a quarterly basis and
represents the estimated future net revenues from nonoperating interests
in proved properties using current prices discounted at ten percent.
Proceeds from the sale or disposition of nonoperating interests in oil
and gas properties are treated as a reduction of the cost of the
nonoperating interests with no gains or losses recognized except in
significant transactions.
The Partnership computes the provision for amortization of oil
and gas properties on the units-of-production method. Under this method,
the provision is calculated by multiplying the total unamortized cost of
oil and gas properties by an overall rate determined by dividing the
physical units of oil and gas produced during the period by the total
estimated proved oil and gas reserves at the beginning of the period.
The calculation of the "ceiling limitation" and the provision
for depreciation, depletion and amortization is based on estimates of
proved reserves. There are numerous uncertainties inherent in estimating
quantities of proved reserves and in projecting the future rates of
production, timing and plan of development. The accuracy of any reserve
estimate is a function of the quality of available data and of
engineering and geological interpretation and judgment. Results of
drilling, testing and production subsequent to the date of the estimate
may justify revision of such estimate. Accordingly, reserve estimates
are often different from the quantities of oil and gas that are
ultimately recovered.
(4) Related-Party Transactions -
An affiliate of the Special General Partner, as Dealer
Manager, received $117,747 for managing and overseeing the offering of
the limited partnership units. A one-time management fee of $119,259 was
paid to Swift for services performed for the Partnership.
The Partnership entered into a Net Profits and Overriding
Royalty Interest Agreement ("NP/OR Agreement") with Swift Energy Income
Partners 1988-B, Ltd. ("Operating Partnership"), managed by Swift, for
the purpose of acquiring nonoperating interests in producing oil and gas
properties. Under terms of the NP/OR Agreement, the Operating
Partnership will convey to the Partnership nonoperating interests in the
aggregate net profits (i.e., oil and gas sales net of related operating
costs) of the properties acquired equal to its proportionate share of
the property acquisition costs.
(5) Vulnerability Due to Certain Concentrations -
The Partnership's revenues are primarily the result of sales
of its oil and natural gas production. Market prices of oil and natural
gas may fluctuate and adversely affect operating results.
7
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
In the normal course of business, the Partnership extends
credit, primarily in the form of monthly oil and gas sales receivables,
to various companies in the oil and gas industry which results in a
concentration of credit risk. This concentration of credit risk may be
affected by changes in economic or other conditions and may accordingly
impact the Partnership's overall credit risk. However, the Managing
General Partner believes that the risk is mitigated by the size,
reputation, and nature of the companies to which the Partnership extends
credit. In addition, the Partnership generally does not require
collateral or other security to support customer receivables.
(6) Fair Value of Financial Instruments -
The Partnership's financial instruments consist of cash and
cash equivalents and short-term receivables and payables. The carrying
amounts approximate fair value due to the highly liquid nature of the
short-term instruments.
(7) Year 2000 -
The Year 2000 issue results from computer programs and
embedded computer chips with date fields that cannot distinguish between
the years 1900 and 2000. The Managing General Partner has implemented
the steps necessary to make its operations and the related operations of
the Partnership capable of addressing the Year 2000. These steps
included upgrading, testing and certifying its computer systems and
field operation services and obtaining Year 2000 compliance
certification from all important business suppliers. The Managing
General Partner formed a task force during 1998 to address the Year 2000
issue and prepare its business systems for the Year 2000. The Managing
General Partner has either replaced or updated mission critical systems
and has substantially completed testing and will continue remedial
actions as needed.
The Managing General Partner's business systems are almost
entirely comprised of off-the-shelf software. Most of the necessary
changes in computer instructional code were made by upgrading this
software. In addition, the Managing General Partner has received
certification as to Year 2000 compliance from vendors or third party
consultants.
The Managing General Partner does not believe that costs
incurred to address the Year 2000 issue with respect to its business
systems will have a material effect on the Partnership's results of
operations, or its liquidity and financial condition. The estimated
total cost to the Managing General Partner to address Year 2000 issues
is projected to be less than $150,000, most of which was spent during
the testing phase. The Partnership's share of this cost is expected to
be insignificant.
8
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
The failure to correct a material Year 2000 problem could
result in an interruption, or failure of certain normal business
activities or operations. Based on activities to date, the Managing
General Partner believes that it has resolved any Year 2000 problems
concerning its financial and administrative systems. It is
undeterminable how all the aspects of the Year 2000 will impact the
Partnership. The most reasonably likely worst case scenario would
involve a prolonged disruption of external power sources upon which core
equipment relies, resulting in a substantial decrease in the
Partnership's oil and gas production activities. In addition, the
pipeline operators to whom the Managing General Partner sells the
Partnership's natural gas, as well as other customers and suppliers,
could be prone to Year 2000 problems that could not be assessed or
detected by the Managing General Partner. The Managing General Partner
has contacted its major purchasers, customers, suppliers, financial
institutions and others with whom it conducts business to determine
whether they will be able to resolve in a timely manner any Year 2000
problems directly affecting the Managing General Partner or Partnership
and to inform them of the Managing General Partner's internal assessment
of its Year 2000 review. There can be no assurance that such third
parties will not fail to appropriately address their Year 2000 issues or
will not themselves suffer a Year 2000 disruption that could have a
material adverse effect on the Partnership's activities, financial
condition or operating results. Based upon these responses and any
problems that arise, contingency plans or back-up systems would be
determined and addressed.
9
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Partnership is formed for the purpose of investing in nonoperating
interests in producing oil and gas properties located within the continental
United States. In order to accomplish this, the Partnership goes through two
distinct yet overlapping phases with respect to its liquidity and results of
operations. When the Partnership is formed, it commences its "acquisition"
phase, with all funds placed in short-term investments until required for the
acquisition of nonoperating interests. Therefore, the interest earned on these
pre-acquisition investments becomes the primary cash flow source for initial
partner distributions. As the Partnership acquires nonoperating interests in
producing properties, net cash from ownership of nonoperating interests becomes
available for distribution, along with the investment income. After all
partnership funds have been expended on nonoperating interests in producing oil
and gas properties, the Partnership enters its "operations" phase. During this
phase, income from nonoperating interests in oil and gas sales generates
substantially all revenues, and distributions to partners reflect those revenues
less all associated partnership expenses. The Partnership may also derive
proceeds from the sale of nonoperating interests in acquired oil and gas
properties, when the sale of such interests is economically appropriate or
preferable to continued operations.
LIQUIDITY AND CAPITAL RESOURCES
Oil and gas reserves are depleting assets and therefore often experience
significant production declines each year from the date of acquisition through
the end of the life of the property. The primary source of liquidity to the
Partnership comes almost entirely from the income generated from the sale of oil
and gas produced from ownership interests in oil and gas properties. This source
of liquidity and the related results of operations, and in turn cash
distributions, will decline in future periods as the oil and gas produced from
these properties also declines while production and general and administrative
costs remain relatively stable making it unlikely that the Partnership will hold
the properties until they are fully depleted, but will likely liquidate when a
substantial majority of the reserves have been produced. Cash distributions to
partners are determined quarterly, based upon the net profits interest payment
received from the companion operating partnership, less general and
administrative expenses. The net profits interest payment is determined based
upon net proceeds from sale of oil and gas production after payment of lease
operating expense, taxes and development costs. In addition, future partnership
cash requirements are taken into account to determine necessary cash reserves.
Net cash provided by operating activities totaled $12,228 and $16,280 for
the nine months ended September 30, 1999 and 1998, respectively. Cash provided
by proceeds from the sale of nonoperating interests in properties totaled
$24,171 for the nine months ended September 30, 1999. Cash distributions totaled
$25,957 and $77,204 for the nine months ended September 30, 1999 and 1998,
respectively. In 1999, cash distributions were effected by the Partnership's
production declines and low oil and gas prices received during the first part of
this year.
The Partnership has expended all of the partners' net commitments
available for property acquisitions and development by acquiring producing oil
and gas properties. The partnership invests primarily in proved producing
properties with nominal levels of future costs of development for proven but
undeveloped reserves. Significant purchases of additional reserves or extensive
drilling activity are not anticipated. Under the NP/OR Agreement, the Managing
General Partner acquires interests in oil and gas properties from outside
parties and sells these interests to an affiliated operating partnership, who in
turn creates and sells to the Partnership nonoperating interests in these same
oil and gas properties.
RESULTS OF OPERATIONS
The following analysis explains changes in the revenue and expense
categories for the quarter ended September 30, 1999 (current quarter) when
compared to the quarter ended September 30, 1998 (corresponding quarter), and
for the nine months ended September 30, 1999 (current period), when compared to
the nine months ended September 30, 1998 (corresponding period).
10
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Three Months Ended September 30, 1999 and 1998
Income from nonoperating interests decreased 52 percent in the third
quarter of 1999 when compared to the same quarter in 1998. Oil and gas sales
decreased $10,923 or 46 percent in the third quarter of 1999 when compared to
the corresponding quarter in 1998, primarily due to decreased oil and gas
production. Current quarter production volumes decreased 53 percent as oil and
gas production declined 25 percent 54 percent, respectively, when compared to
third quarter 1998 production volumes. Production declines are a result of the
accelerated depletion of the Partnership's mature wells. Oil prices increased 12
percent or $1.50/BBL to an average of $13.88/BBL and gas prices increased 22
percent or $.41/MCF to an average of $2.25/MCF for the quarter. Increased oil
and gas prices helped offset the effect of decreased production.
Corresponding production costs per equivalent MCF increased 32 percent in
the third quarter of 1999 compared to the third quarter of 1998 and total
production costs decreased 33 percent.
Total amortization expense for the third quarter of 1999 decreased 87
percent or $28,517 when compared to the third quarter of 1998. In 1998, two
components, the normal provision, calculated on the units of production method,
and the additional provision, relating to the ceiling limitation, make up total
amortization expense. Normal amortization expense decreased 56 percent or $5,490
in the third quarter of 1999 compared to the third quarter of 1998.
The Partnership recorded an additional provision in amortization in the
third quarter of 1998 for $23,027, when the present value, discounted at ten
percent, of estimated future net revenues from oil and gas properties, using the
guidelines of the Securities and Exchange Commission, was below the fair market
value for oil and gas properties resulting in a full cost ceiling impairment.
Nine Months Ended September 30, 1999 and 1998
Income from nonoperating interests increased 54 percent in the first nine
months of 1999 when compared to the same period in 1998. Oil and gas sales
declined $31,766 or 49 percent in the first nine months of 1999 when compared to
the corresponding period in 1998, primarily due to decreased oil and gas
production. Current period production volumes decreased 50 percent as oil and
gas production declined 64 percent 49 percent, respectively, when compared to
the same period in 1998. Production declines are a result of the accelerated
depletion of the Partnership's mature wells. Oil prices increased 2 percent or
$.31/BBL to an average of $13.42/BBL and gas prices increased 6 percent or
$.11/MCF to an average of $1.89/MCF for the current period.
Corresponding production costs per equivalent MCF increased 18 percent in
the first nine months of 1999 compared to the corresponding period in 1998 and
total production costs decreased 39 percent.
Total amortization expense for the first nine months of 1999 decreased 75
percent or $37,860 when compared to the first nine months of 1998. In 1998, two
components, the normal provision, calculated on the units of production method,
and the additional provision, relating to the ceiling limitation, make up total
amortization expense. Normal amortization expense decreased 54 percent or
$14,833 in the first nine months of 1999 compared to the first nine months of
1998.
The Partnership recorded an additional provision in amortization in the
first nine months in 1998 for $23,027, when the present value, discounted at ten
percent, of estimated future net revenues from oil and gas properties, using the
guidelines of the Securities and Exchange Commission, was below the fair market
value for oil and gas properties resulting in a full cost ceiling impairment.
During 1999, partnership revenues and costs will be shared between the
limited partners and general partners in a 90:10 ratio.
11
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD
PART II - OTHER INFORMATION
ITEM 5. OTHER INFORMATION
-NONE-
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-A, LTD..
(Registrant)
By: SWIFT ENERGY COMPANY
Managing General Partner
Date: November 4, 1999 By: /s/ John R. Alden
---------------- --------------------------------------
John R. Alden
Senior Vice President, Secretary
and Principal Financial Officer
Date: November 4, 1999 By: /s/ Alton D. Heckaman, Jr.
---------------- --------------------------------------
Alton D. Heckaman, Jr.
Vice President, Controller
and Principal Accounting Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Swift Energy
Managed Pension Assets Partnership 1988-A Ltd.'s balance sheet and statement of
operations contained in its Form 10-Q for the quarter ended September 30, 1999
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 19,262
<SECURITIES> 0
<RECEIVABLES> 1,104
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 20,366
<PP&E> 4,141,867
<DEPRECIATION> (3,891,885)
<TOTAL-ASSETS> 270,348
<CURRENT-LIABILITIES> 8,387
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 261,961
<TOTAL-LIABILITY-AND-EQUITY> 270,348
<SALES> 18,982
<TOTAL-REVENUES> 19,651
<CGS> 0
<TOTAL-COSTS> 12,636<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (14,529)
<INCOME-TAX> 0
<INCOME-CONTINUING> (14,529)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (14,529)
<EPS-BASIC> 0
<EPS-DILUTED> 0
<FN>
<F1>Includes lease operating expenses, production taxes and depreciation,
depletion and amortization expense. Excludes general and administrative and
interest expense.
</FN>
</TABLE>
