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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
AMENDMENT III
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from...............to...............
Commission file number 0-17562
ENEX OIL AND GAS INCOME PROGRAM III, Series 8, L.P.
(Name of small business issuer in its charter)
New Jersey 76-0214442
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
800 Rockmead Drive
Three Kingwood Place
Kingwood, Texas 77339
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including: (713) 358-8401
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Limited Partnership Interest
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the past 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
Check if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B is not contained in this form, and no
disclosure will be contained, to the best of the registrant's knowledge, in
definitive proxy or information statements incorporated by reference in Part III
of this Form 10-KSB or any amendment to this Form 10-KSB.[x]
State issuer's revenues for its most recent fiscal year. $274,259
State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock as of a specified date within
the past 60 days (See definition of affiliate in Rule 12b-2 of the Exchange
Act):
Not Applicable
Documents Incorporated By Reference:
None
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PART II
Item 5. Market for Common Equity and Related Security Holder Matters
Market Information
There is no established public trading market for the Company's
outstanding limited partnership interests.
Number of Equity Security Holders
Number of Record Holders
Title of Class (as of March 1, 1996)
----------------- ----------------------------
General Partner's Interests 1
Limited Partnership Interests 1,552
Dividends
The Company made cash distributions to partners of $2 and $14 per $500
investment in 1995 and 1994, respectively. The Company suspended the payment of
a distribution in the second quarter of 1995. The payment of future
distributions will depend on the Company's earnings, financial condition,
working capital requirements and other factors. Based upon current projected
cash flows from its property, it does not appear that the Company will have
sufficient net cash flow after debt service to pay distributions.
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Item 6. Management's Discussion and Analysis or Plan of Operation
Results of Operations
This discussion should be read in conjunction with the financial
statements of the Company and the notes thereto included in this Form 10-KSB.
Oil and gas sales decreased to $274,259 in 1995 from $356,381 in
1994. This represents a decrease of $82,122 or 23%. Oil sales decreased by
$22,166 or 12%. A 23% decline in production caused sales to decrease by $42,122.
This decrease was partially offset by a 14% increase in the average oil sales
price. Gas sales decreased by $59,956 or 34%. A 30% decrease in gas production
reduced sales by $51,906. A 7% decrease in the average gas sales price reduced
sales by an additional $8,050. The lower oil production was primarily the result
of the shut-in of production in August, 1995, from the Corkscrew acquisition in
Florida due to hurricane damage. The decrease in gas production was primarily a
result of natural production declines which were especially pronounced on the
RIC and Barnes Estate acquisitions. The changes in average oil and gas sales
prices correspond with changes in the overall market for the sale of oil and
gas.
Lease operating expenses decreased to $158,949 in 1994, from
$165,836 in 1994. The decrease of $6,887 or 4% was primarily a result of the
decline in oil production, noted above.
Depreciation and depletion expense decreased to $166,216 in 1995
from $189,450 in 1994. This represents a decrease of $23,234 or 12%. The changes
in production, noted above, caused depreciation and depletion to decrease by
$49,271. This decrease was partially offset by a 19% increase in the depletion
rate. The increase in the depletion rate was primarily the result of a downward
revision of the oil reserves during 1995, partially offset by an upward revision
of the gas reserves during 1995.
Effective October 1, 1995, the Company sold its interest in the Kidd
#1 well in the Enexco acquisition to Humphrey Oil Co. for $23,400. A gain from
the sale of $20,823 was recognized by the Company.
General and administrative expenses increased to $70,451 in 1995
from $52,319 in 1994. The increase of $18,132 or 35% was primarily due to a
$24,195 increase in direct expenses resulting from legal fees from a property
interest dispute on the Barnes Estate acquisition. This case is set for trial in
the second quarter of 1996. The Company does not expect the settlement of the
dispute to have a material impact on the financial statements.
Capital Resources and Liquidity
The Company's cash flow from operations is a direct result of the
amount of net proceeds from the sale of oil and gas production after payment of
its debt obligations. Accordingly, the changes in cash flow from 1994 to 1995
are primarily due to the changes in oil and gas sales described above. It is the
general partner's intention to distribute substantially all of the Company's
available net cash flow to the Company's partners.
The Company discontinued the payment of distributions in the second
quarter of 1995. Future distributions are dependent upon among other things, an
increase in the prices received for oil and gas. The Company will continue to
recover its reserves and reduce its obligations in 1996. The Company does not
intend to purchase additional properties or fund extensive development of
existing oil and gas properties, and as such; has no long-term liquidity needs.
The Company's projected cash flows from operations will provide sufficient
funding to pay its operating expenses and debt obligations. The general partner
does not intend to accelerate the repayment of the debt beyond the cash flow
provided by operating, financing and investing activities. Based upon current
projected cash flows from its property, it does not appear that the Company will
have sufficient cash to pay distributions and pay its operating expenses, and
meet its
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debt obligations. The Company plans to repay the amount owed to the general
partner over a three year period.
At December 31, 1995, the Company had no material commitments for
capital expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
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Item 7. Financial Statements and Supplementary Data
INDEPENDENT AUDITORS' REPORT
The Partners
Enex Oil & Gas Income
Program III - Series 8, L.P.:
We have audited the accompanying balance sheet of Enex Oil & Gas Income Program
III - Series 8, L.P. (a New Jersey limited partnership) as of December 31, 1995
and the related statements of operations, changes in partners' capital, and cash
flows for each of the two years in the period ended December 31, 1995. These
financial statements are the responsibility of the general partner of Enex Oil &
Gas Income Program III - Series 8, L.P. Our responsibility is to express an
opinion on the financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of Enex Oil & Gas Income Program III - Series
8, L.P. at December 31, 1995 and the results of its operations and its cash
flows for each of the two years in the period ended December 31, 1995 in
conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Houston, Texas
March 18, 1996
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<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM III - SERIES 8, L.P.
BALANCE SHEET, DECEMBER 31, 1995
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ASSETS
1995
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CURRENT ASSETS:
<S> <C>
Cash $ 2,589
Accounts receivable - oil & gas sales 29,735
Other current assets 2,874
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Total current assets 35,198
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OIL & GAS PROPERTIES
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities 3,635,287
Less accumulated depreciation and depletion 3,113,299
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Property, net 521,988
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TOTAL $ 557,186
==============
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 17,036
Payable to general partner 150,169
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Total current liabilities 167,205
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PARTNERS' CAPITAL (DEFICIT):
Limited partners 345,970
General partner 44,011
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Total partners' capital 389,981
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TOTAL $ 557,186
==============
Number of $500 Limited Partner units outstanding 4,808
</TABLE>
See accompanying notes to financial statements.
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II-5
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ENEX OIL & GAS INCOME PROGRAM III - SERIES 8, L.P.
NOTES TO FINANCIAL STATEMENTS
FOR THE TWO YEARS ENDED DECEMBER 31, 1995
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1. PARTNERSHIP ORGANIZATION
Enex Oil & Gas Income Program III - Series 8, L.P. (the "Company"),
a New Jersey limited partnership, commenced operations on May 11,
1988 for the purpose of acquiring proved oil and gas properties.
Total limited partner contributions were $3,598,188, of which
$35,982 was contributed by Enex Resources Corporation ("Enex"), the
general partner.
In accordance with the partnership agreement, the Company paid
commissions of $354,161 for solicited subscriptions to Enex
Securities Corporation, a subsidiary of Enex, and reimbursed Enex
for organization expenses of approximately $108,000.
Information relating to the allocation of costs and revenues between
Enex, as general partner, and the limited partners is as follows:
Limited
Enex Partners
Commissions and selling expenses 100%
Company reimbursement of organization
expense 100%
Company property acquisition 100%
General and administrative costs 10% 90%
Costs of drilling and completing
development wells 10% 90%
Revenues from temporary investment of
partnership capital 100%
Revenues from producing properties 10% 90%
Operating costs (including general and
administrative costs associated with
operating producing properties) 10% 90%
At the point in time when the cash distributions to the limited
partners equal their subscriptions ("payout"), the costs of
drilling and completing development wells, revenues from producing
properties, general and administrative costs and operating costs
will be allocated 15% to the general partner and 85% to the limited
partners.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Oil and Gas Properties - The Company uses the successful efforts
method of accounting for its oil and gas operations. Under this
method, the costs of all development wells are capitalized.
Capitalized costs are amortized on the units-of-production method
based on estimated total proved reserves. The acquisition costs of
proved oil and gas properties are capitalized and periodically
assessed for impairment.
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The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long Lived Assets and for Long-Lived Assets to Be
Disposed Of." This statement requires that long-lived assets and
certain identifiable intangibles held and used by the Company be
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be
recoverable.
The Company has not determined the effect, if any, on its financial
position or results of operations which may result from the
adoption of this statement in the first quarter of 1996.
The Company's operating interests in oil and gas properties are
recorded using the pro rata consolidation method pursuant to
Interpretation 2 of Accounting Principles Board Opinion 18.
Cash Flows - The Company has presented its cash flows using the
indirect method and considers all highly liquid investments with an
original maturity of three months or less to be cash equivalents.
General and Administrative Expenses - The Company reimburses the
General Partner for direct costs and administrative costs incurred
on its behalf. Administrative costs allocated to the Company are
computed on a cost basis in accordance with standard industry
practices by allocating the time spent by the General Partner's
personnel among all projects and by allocating rent and other
overhead on the basis of the relative direct time charges.
Uses of Estimates - The preparation of the 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 and disclosure of
contigent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during
the reporting periods. Actual results could differ from these
estimates.
3. FEDERAL INCOME TAXES
General - The Company is not a taxable entity for federal income
tax purposes. Such taxes are liabilities of the individual partners
and the amounts thereof will vary depending on the individual
situation of each partner. Accordingly, there is no provision for
income taxes in the accompanying financial statements.
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4. PAYABLE TO GENERAL PARTNER
The payable to general partner primarily consists of general and
administrative expenses allocated to the Company by Enex during the
Company's start-up phase and for its ongoing operations. The
Company's plans to repay the amounts owed to the general partner
over a period of three years.
5. REPURCHASE OF LIMITED PARTNER INTERESTS
In accordance with the partnership agreement, the general partner
is required to purchase limited partner interests (at the option of
the limited partners) at annual intervals beginning after the
second year following the formation of the Company. The purchase
price, as specified in the partnership agreement, is based
primarily on reserve reports prepared by independent petroleum
engineers as reduced by a specified risk factor.
6. SIGNIFICANT PURCHASERS
Valero Industrial Gas L.P., Sunniland Pipeline Company and American
Exploration Corp. accounted for 23%, 21% and 10%, respectively, of
the Company's total sales in 1995. Valero Industrial Gas L.P.,
Michael Petroleum Corp. and Sunniland Pipeline Company accounted
for 22%, 19% and 18%, respectively, of the Company's total sales
in 1994. No other purchaser individually accounted for more than
10% of such sales.
7. PROPERTY SALE
Effective October 1, 1995, the Company sold its interest in the
Kidd #1 well in the Enexco acquisition to Humphrey Oil Co. for
$23,400. A gain from the sale of $20,823 was recognized by the
Company.
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Item 8. Changes In and Disagreements With Accountants on Accounting and
Financial Disclosure
Not Applicable
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SIGNATURES
In accordance with Section 13 or 15 (d) of the Exchange Act,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
ENEX OIL AND GAS INCOME PROGRAM III-
SERIES 8, L.P.
By: ENEX RESOURCES CORPORATION
the General Partner
December 23, 1996 By: /s/ G. B. Eckley
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G. B. Eckley, President
In accordance with the Exchange Act, this report has been
signed below on December 23, 1996, by the following persons in the capacities
indicated.
ENEX RESOURCES CORPORATION General Partner
By: /s/ G. B. Eckley
------------------------
G. B. Eckley, President
/s/ G. B. Eckley
President, Chief Executive
------------------ Officer and Director
G. B. Eckley
/s/ R. E. Densford Vice President, Secretary, Treasurer,
Chief Financial Officer and Director
-------------------
R. E. Densford
/s/ James A. Klein Controller and Chief Accounting Officer
-----------------
James A. Klein
S-1
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<NAME> ENEX OIL & GAS INCOME PROGRAM III - SERIES 8, L.P.
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<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-START> jan-01-1996
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<CASH> 2589
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