<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
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 33-15998-02
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
(Exact name of registrant as specified in
its Certificate of Limited Partnership)
TEXAS 76-0261807
(State of Organization) (I.R.S. Employer Identification No.)
16825 Northchase Dr., Suite 400
Houston, Texas 77060
(713) 874-2700
(Address and telephone number of principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
36,311.45 Limited Partnership Units
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 periods that the
registrant was required), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]
Registrant does not have an aggregate market value for its Limited
Partnership Interests.
Documents Incorporated by Reference
DOCUMENT INCORPORATED AS TO
Registration Statement No. 33-15998 Items 1 and 13
on Form S-1
<PAGE>
TABLE OF CONTENTS
FORM 10-K ANNUAL REPORT
FOR THE PERIOD ENDED DECEMBER 31, 1995
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
ITEM NO. PART I PAGE
- -------- ------ ----
1 Business I-1
2 Properties I-5
3 Legal Proceedings I-8
4 Submission of Matters to a Vote of
Security Holders I-8
PART II
-------
5 Market Price of and Distributions on the
Registrant's Units and Related Limited
Partner Matters II-1
6 Selected Financial Data II-2
7 Management's Discussion and Analysis of
Financial Condition and Results of Operations II-2
8 Financial Statements and Supplementary Data II-3
9 Disagreements on Accounting and Financial
Disclosure II-3
PART III
--------
10 Directors and Executive Officers of the
Registrant III-1
11 Executive Compensation III-2
12 Security Ownership of Certain Beneficial
Owners and Management III-2
13 Certain Relationships and Related Transactions III-2
PART IV
-------
14 Exhibits, Financial Statement Schedules
and Reports on Form 8-K IV-1
OTHER
-----
Signatures
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
PART I
ITEM 1. BUSINESS
GENERAL DESCRIPTION OF PARTNERSHIP
Swift Energy Managed Pension Assets Partnership 1988-B, Ltd., a Texas
limited partnership (the "Partnership" or the "Registrant"), is a partnership
formed under a public serial limited partnership offering denominated Swift
Energy Managed Pension Assets Fund I (Registration Statement No. 33-15998 on
Form S-1, originally declared effective November 13, 1987, and amended effective
November 3, 1988, August 4, 1989 and May 1, 1990 [the "Registration
Statement"]). The Partnership was formed effective September 14, 1988 under a
Limited Partnership Agreement dated September 13, 1988. The initial 331 limited
partners made capital contributions of $3,631,145.
The Partnership is principally engaged in the business of acquiring
nonoperating interests (I.E., net profits interests, royalty interests and
overriding royalty interests) in proven oil and gas properties within the
continental United States. The Partnership does not acquire working interests
in or operate oil and gas properties, and does not engage in drilling
activities. At December 31, 1995, the Partnership had expended or committed to
expend 100% of the limited partners' net commitments (I.E., limited partners'
commitments available to the Partnership for property acquisitions after payment
of organizational fees and expenses) in the acquisition and development of
nonoperating interests in producing properties, which properties are described
under Item 2, "Properties," below. The Partnership's income is derived almost
entirely from its nonoperating interests and the disposition thereof.
The Partnership's business and affairs are conducted by its Managing
General Partner, Swift Energy Company, a Texas corporation ("Swift"). The
Partnership's Special General Partner, VJM Corporation, a California corporation
("VJM"), consults with and advises Swift as to certain financial matters.
The general manner in which the Partnership acquires nonoperating interests
and otherwise conducts its business is described in detail in the Registration
Statement under "Proposed Activities," which is incorporated herein by
reference. The following is intended only as a summary of the Partnership's
manner of doing business and specific activities to date.
MANNER OF ACQUIRING NONOPERATING INTERESTS IN PROPERTIES; NET PROFITS AND
OVERRIDING ROYALTY INTEREST AGREEMENT
The nonoperating interests owned by the Registrant have typically been
acquired pursuant to a Net Profits and Overriding Royalty Interest Agreement
dated October 18, 1988 (the "NP/OR Agreement") between the Registrant and Swift
Energy Income Partners 1988-C, Ltd. (the "Operating Partnership"). The
Operating Partnership is a Texas limited partnership that is also managed by
Swift and VJM. The Operating Partnership was formed to acquire and develop
producing oil and gas properties.
Under the NP/OR Agreement, the Registrant and the Operating Partnership
have, in effect, combined their funds to acquire producing properties. Using
funds committed to the NP/OR Agreement by both partnerships, the Operating
Partnership acquires producing properties, then promptly conveys nonoperating
interests therein to the Registrant. The Operating Partnership retains a
working interest in each such property, and is responsible for the production of
oil and gas therefrom. For the sake of legal and administrative convenience,
producing properties are usually acquired from the third party sellers by Swift,
which then conveys a working interest in each such property to the Operating
Partnership. The Registrant initially committed $3,118,567 and the Operating
Partnership initially committed $4,647,380 for acquisitions under the NP/OR
Agreement. The Operating Partnership is obligated under the NP/OR Agreement to
convey to the Registrant a 40% fixed net profits interest and a variable
overriding royalty interest in specified depths of all producing properties
acquired under the NP/OR Agreement.
Under the NP/OR Agreement, the Operating Partnership is required to convey
to the Registrant, and the Registrant is required to purchase, nonoperating
interests in all producing properties acquired by the Operating Partnership,
except that:
I-1
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
1. properties anticipated to require significant development
operations and nonoperating interests offered to the Operating Partnership by
third parties may be purchased by the Operating Partnership outside the NP/OR
Agreement, without participation by the Registrant;
2. during a specified one-year period, the Registrant is entitled to
reduce the amount originally committed by it to purchases under the NP/OR
Agreement and to redirect such funds to the purchase of nonoperating interests
from sources other than the Operating Partnership; and
3. the Registrant's funds will be released from the NP/OR Agreement
if they are not completely spent by the Operating Partnership within a specified
period, or if there is a prior withdrawal of funds by the Operating Partnership
to purchase properties anticipated to require significant development.
Purchases of nonoperating interests by the Registrant using withdrawn or
released funds may be made from the Managing General Partner and its affiliates,
other partnerships affiliated with the Operating Partnership (possibly through
the Registrant's entry into a new NP/OR Agreement), or from unaffiliated third
parties. During 1988, the Registrant withdrew a portion of its funds originally
committed to the NP/OR Agreement in order to purchase certain nonoperating
interests directly from Northwind Exploration Company.
In accordance with its obligations under the NP/OR Agreement, as of
December 31, 1995 the Operating Partnership had conveyed to the Registrant a 40%
net profits interest burdening certain depths of all producing properties
acquired by the Operating Partnership thereunder. Typically, a net profits
interest in an oil and gas property entitles the owner to a specified percentage
share of the gross proceeds generated by the burdened property, net of operating
costs. The net profits interest conveyed to the Registrant under the NP/OR
Agreement differs from the typical net profits interest in that it is calculated
over the entire group of producing properties conveyed under the NP/OR
Agreement; I.E., all operating costs attributable to the burdened depths of such
properties are aggregated, and the total is then subtracted from the total of
all gross proceeds attributable to such depths in order to calculate the net
profits to which the Registrant is entitled. The net profits interest conveyed
to the Registrant burdens only those depths of each subject property which were
evaluated to contain proved reserves at the date of acquisition, to the extent
such depths underlie specified surface acreage.
The Operating Partnership has also conveyed to the Registrant under the
NP/OR Agreement an overriding royalty interests in each property acquired
thereunder. An overriding royalty interest is a fractional interest in the
gross production (or the gross proceeds therefrom) of oil and gas from a
property, free of any exploration, development, operation or maintenance
expenses. Under the NP/OR Agreement, the overriding royalty interest burdens
the portions of each producing property that were evaluated at the date of
acquisition not to contain proved reserves.
COMPETITION, MARKETS AND REGULATIONS
COMPETITION
The oil and gas industry is highly competitive in all its phases. The
Partnership encounters strong competition from many other oil and gas producers,
many of which possess substantial financial resources, in acquiring economically
desirable Producing Properties.
MARKETS
The amounts of and price obtainable for oil and gas production from
Partnership Properties will be affected by market factors beyond the control of
the Partnership. Such factors include the extent of domestic production, the
level of imports of foreign oil and gas, the general level of market demand on a
regional, national and worldwide basis, domestic and foreign economic conditions
that determine levels of industrial production, political events in foreign oil-
producing regions, and variations in governmental regulations and tax laws and
the imposition of new governmental requirements upon the oil and gas industry.
There can be no assurance that oil and gas prices will not decrease in the
future, thereby decreasing net Revenues from Partnership Properties.
I-2
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
From time to time, there may exist a surplus of natural gas or oil
supplies, the effect of which may be to reduce the amount of hydrocarbons that
the Partnerships may produce and sell while such oversupply exists. In recent
years, initial steps have been taken to provide additional gas transportation
lines from Canada to the United States. If additional Canadian gas is brought
to the United States market, it could create downward pressure on United States
gas prices.
REGULATIONS
ENVIRONMENTAL REGULATION
The federal government and various state and local governments have adopted
laws and regulations regarding the control of contamination of the environment.
These laws and regulations may require the acquisition of a permit by Operators
before drilling commences, prohibit drilling activities on certain lands lying
within wilderness areas or where pollution arises and impose substantial
liabilities for pollution resulting from operations, particularly operations
near or in onshore and offshore waters or on submerged lands. These laws and
regulations may also increase the costs of routine drilling and operation of
wells. Because these laws and regulations change frequently, the costs to the
Partnership of compliance with existing and future environmental regulations
cannot be predicted. However, the Managing Partner does not believe that the
Partnership is affected in a significantly different manner by these regulations
than are its competitors in the oil and gas industry.
FEDERAL REGULATION OF NATURAL GAS
The transportation and sale of natural gas in interstate commerce is
heavily regulated by agencies of the federal government. The following
discussion is intended only as a summary of the principal statutes, regulations
and orders that may affect the production and sale of natural gas from
Partnership Properties. This summary should not be relied upon as a complete
review of applicable natural gas regulatory provisions.
PRICE CONTROLS - Prior to January 1, 1993, the sale of natural gas
production was subject to regulation under the Natural Gas Act and the Natural
Gas Policy Act of 1978 ("NGPA"). Under the Natural Gas Wellhead Decontrol Act
of 1989, however, all price regulation under the NGPA and Natural Gas Act rate,
certificate and abandonment requirements were phased out effective as of January
1, 1993.
FERC ORDERS
Several major regulatory changes have been implemented by the Federal
Energy Regulatory Commission ("FERC") from 1985 to the present that affect the
economics of natural gas production, transportation and sales. In addition, the
FERC continues to promulgate revisions to various aspects of the rules and
regulations affecting those segments of the natural gas industry that remain
subject to the FERC's jurisdiction. In April 1992, the FERC issued Order No.
636 pertaining to pipeline restructuring. This rule requires interstate
pipelines to unbundle transportation and sales services by separately stating
the price of each service and by providing customers only the particular service
desired, without regard to the source for purchase of the gas. The rule also
requires pipelines to (i) provide nondiscriminatory "no-notice" service allowing
firm commitment shippers to receive delivery of gas on demand up to certain
limits without penalties, (ii) establish a basis for release and reallocation of
firm upstream pipeline capacity, and (iii) provide non-discriminatory access to
capacity by firm transportation shippers on a downstream pipeline. The rule
requires interstate pipelines to use a straight fixed variable rate design. The
rule imposes these same requirements upon storage facilities.
FERC Order No. 500 affects the transportation and marketability of natural
gas. Traditionally, natural gas had been sold by producers to pipeline
companies, which then resold the gas to end-users. FERC Order No. 500 altered
this market structure by requiring interstate pipelines that transport gas for
others to provide transportation service to producers, distributors and all
other shippers of natural gas on a nondiscriminatory, "first-come, first-served"
basis (open access transportation"), so that producers and other shippers can
sell natural gas directly to end-users. FERC Order No. 500 contains additional
provisions intended to promote greater competition in natural gas markets.
It is not anticipated that the marketability of and price obtainable for
natural gas production from Partnership Properties will be significantly
affected by FERC Order No. 500. Gas produced from Partnership Properties
normally will be sold to intermediaries who have entered into transportation
arrangements with pipeline companies. These intermediaries will accumulate gas
purchased from a number of producers and sell the gas to end-users through open
access pipeline transportation.
I-3
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
STATE REGULATIONS
Production of any oil and gas from Partnership Properties will be affected
to some degree by state regulations. Many states in which the Partnership will
operate have statutory provisions regulating the production and sale of oil and
gas, including provisions regarding deliverability. Such statutes, and the
regulations promulgated in connection therewith, are generally intended to
prevent waste of oil and gas and to protect correlative rights to produce oil
and gas between owners of a common reservoir. Certain state regulatory
authorities also regulate the amount of oil and gas produced by assigning
allowable rates of production to each well or proration unit.
FEDERAL LEASES
Some of the Partnership's properties are located on federal oil and gas
leases administered by various federal agencies, including the Bureau of Land
Management. Various regulations and orders affect the terms of leases,
exploration and development plans, methods of operation and related matters.
EMPLOYEES
The Partnership has no employees. Swift, however, has a staff of
geologists, geophysicists, petroleum engineers, landmen, and accounting
personnel who administer the operations of Swift and the Partnership. As of
December 31, 1995, Swift had 176 employees. Swift's administrative and overhead
expenses attributable to the Partnership's operations are borne by the
Partnership.
I-4
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
ITEM 2. NONOPERATING INTERESTS IN PROPERTIES
As of December 31, 1995, the Partnership has acquired interests in
producing oil and gas properties which are generally described below.
PRINCIPAL OIL AND GAS PRODUCING PROPERTIES
The most valuable fields in the Partnership, based upon year-end
engineering estimates of discounted future net revenues using constant pricing
and costs, are described below.
1. Approximately 15% of the Partnership's value is from the AWP Field in
McMullen County, Texas (Shell Oil Company acquisition). The wells produce from
the Olmos formation in this field.
The remaining value in the Partnership is attributable to numerous
properties none of which equals or exceeds 15 percent of the total Partnership
value.
TITLE TO PROPERTIES
Title to substantially all significant producing properties in which the
Partnership owns nonoperating interests has been examined. In addition to the
nonoperating interests owned by the Partnership, the properties are subject to
royalty, overriding royalty and other interests customary in the industry. The
Managing General Partner does not believe any of these burdens materially
detract from the value of the properties or will materially detract from the
value of the properties or materially interfere with their use in the operation
of the business of the Partnership.
PRODUCTION AND SALES PRICE
The following table summarizes the volumes of the Partnership's net
nonoperating interests in oil and gas production expressed in MCFs. Equivalent
MCFs are obtained by converting oil to gas on the basis of their relative energy
content; one barrel of oil equals 6,000 cubic feet of gas.
<TABLE>
<CAPTION>
NET PRODUCTION
---------------------------
FOR THE YEARS ENDED
DECEMBER 31,
---------------------------
1995 1994 1993
------- ------- -------
<S> <C> <C> <C>
Net Volumes (Equivalent MCFs) 138,213 168,489 206,215
Average Net Nonoperating
Interest Price per
Equivalent MCF $0.91 $1.24 $1.21
</TABLE>
I-5
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
NET PROVED OIL AND GAS RESERVES
Presented below are the estimates of the Partnership's nonoperating
interests in proved reserves as of December 31, 1995, 1994 and 1993. All of the
Partnership's nonoperating interests in proved reserves are located in the
United States.
<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------------------------------
1995 1994 1993
----------------- ------------------ ------------------
NATURAL NATURAL NATURAL
OIL GAS OIL GAS OIL GAS
------ ------ ------- ------ ------- -------
(BBLS) (MMCF) (BBLS) (MMCF) (BBLS) (MMCF)
<S> <C> <C> <C> <C> <C> <C>
PROVED DEVELOPED
RESERVES AT END OF YEAR 41,469 641 48,413 790 55,283 1,159
------ ---- ------- ----- ------ -----
------ ---- ------- ----- ------ -----
PROVED RESERVES
Balance at beginning
of year 53,925 827 88,202 1,215 93,792 1,339
Purchase of minerals
in place -- -- -- -- -- --
Extensions, discoveries
and other additions -- -- 59 -- 1,035 38
Revisions of previous
estimates (4,905) (37) (23,909) (212) 396 8
Sales of minerals in
place (654) -- (4,645) (42) (472) (3)
Production (4,499) (112) (5,782) (134) (6,549) (167)
------ ---- ------- ----- ------ -----
Balance at end of year 43,867 678 53,925 827 88,202 1,215
------ ---- ------- ----- ------ -----
------ ---- ------- ----- ------ -----
</TABLE>
Revisions of previous quantity estimates are related to upward or downward
variations based on current engineering information for production rates,
volumetrics and reservoir pressure. Additionally, changes in quantity estimates
are the result of the increase or decrease in crude oil and natural gas prices
at each year end which have the effect of adding or reducing proved reserves on
marginal properties due to economic limitations.
I-6
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
The following table summarizes by acquisition the Registrant's reserves and
its nonoperating interests in gross and net producing oil and gas wells as of
December 31, 1995:
<TABLE>
<CAPTION>
RESERVES
DECEMBER 31, 1995
-----------------
NATURAL WELLS
OIL GAS --------------
ACQUISITION STATE(S) (BBLS) (MMCF) GROSS NET
- ----------- ------------ ------ ------- ----- -----
<S> <C> <C> <C> <C> <C>
Potter AR, LA, MS,
NM, OK, TX 28,046 293 187 3.628
Mega, Northwind TX 3,401 67 7 0.035
Anderson, Samedan
Oil, Strebor Oil
& Lake Ronel Oil TX 155 134 6 0.224
Shell Oil Company TX 4,723 117 67 0.191
Union Pacific AR, KS, NM,
OK, TX 7,257 22 127 0.333
Allstate KS, LA, OK 154 32 158 0.885
Norcen - Ag Farms WY 131 -- 3 0.013
Union Pacific II TX -- 13 2 0.058
------ --- --- -----
43,867 678 557 5.367
------ --- --- -----
------ --- --- -----
</TABLE>
There are numerous uncertainties inherent in estimating quantities of
proved reserves and in projecting the future rates of production, timing and
plan of development. Oil and gas reserve engineering must be recognized as a
subjective process of estimating underground accumulations of oil and gas that
cannot be measured in an exact way, and estimates of other engineers might
differ from those above, audited by H. J. Gruy and Associates, Inc., an
independent petroleum consulting firm. 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,
and, as a general rule, reserve estimates based upon volumetric analysis are
inherently less reliable than those based on lengthy production history.
Accordingly, reserve estimates are often different from the quantities of oil
and gas that are ultimately recovered.
In estimating the oil and natural gas reserves, the Registrant, in
accordance with criteria prescribed by the Securities and Exchange Commission,
has used prices received as of December 31, 1995 without escalation, except in
those instances where fixed and determinable gas price escalations are covered
by contracts, limited to the price the Partnership reasonably expects to
receive. The Registrant does not believe that any favorable or adverse event
causing a significant change in the estimated quantity of proved reserves has
occurred between December 31, 1995 and the date of this report.
Future prices received for the sale of the Partnership's products may be
higher or lower than the prices used in the evaluation described above; the
operating costs relating to such production may also increase or decrease from
existing levels. The estimates presented above are in accordance with rules
adopted by the Securities and Exchange Commission.
I-7
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
ITEM 3. LEGAL PROCEEDINGS
The Partnership is not aware of any material pending legal proceedings to
which it is a party or of which any of its property is the subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of limited partners during the fourth
quarter of the fiscal year covered by this report.
I-8
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
PART II
ITEM 5. MARKET PRICE OF AND DISTRIBUTIONS ON THE REGISTRANT'S UNITS AND RELATED
LIMITED PARTNER MATTERS
MARKET INFORMATION
Units in the Partnership were initially sold at a price of $100 per Unit.
Units are not traded on any exchange and there is no established public trading
market for the Units. Swift is aware of negotiated transfers of Units between
unrelated parties; however, these transfers have been limited and sporadic. Due
to the nature of these transactions, Swift has no verifiable information
regarding prices at which Units have been transferred.
HOLDERS
As of December 31, 1995, there were 331 Limited Partners holding Units in
the Partnership.
DISTRIBUTIONS
The Partnership generally makes distributions to Limited Partners on a
quarterly basis, subject to the restrictions set forth in the Limited
Partnership Agreement. In the fiscal years ending December 31, 1994 and 1995,
the Partnership distributed a total of $146,100 and $82,700, respectively, to
holders of its Units. Cash distributions constitute net proceeds from sale of
oil and gas production after payment of lease operating expenses and other
partnership expenses. Some or all of such amounts or any proceeds from the sale
of partnership properties could be deemed to constitute a return of investors'
capital.
Oil and gas investments involve a high risk of loss, and no assurance can
be given that any particular level of distributions to holders of Units can be
achieved or maintained. Although it is anticipated that quarterly distributions
will continue to be made through 1996, the Partnership's ability to make
distributions could be diminished by any event adversely affecting the oil and
gas properties in which the Partnership owns interests or the amount of revenues
received by the Partnership therefrom.
The Partnership's Limited Partnership Agreement contains various provisions
which might serve to delay, defer or prevent a change in control of the
Partnership, such as the requirement of a vote of Limited Partners in order to
sell all or substantially all of the Partnership's properties or the requirement
of consent by the Managing General Partner to transfers of limited partnership
interests.
II-1
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
ITEM 6. SELECTED FINANCIAL DATA
The following selected financial data, prepared in accordance with
generally accepted accounting principles as of December 31, 1995, 1994, 1993,
1992, and 1991, should be read in conjunction with the financial statements
included in Item 8:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
-------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Revenues $122,816 $212,685 $ 247,557 $ 315,892 $ 462,810
Income (Loss) $(76,909) $(83,830) $ 59,440 $ (267,989) $ (474,786)
Total Assets $654,398 $810,230 $1,034,370 $1,127,657 $1,668,357
Cash Distributions $ 89,552 $160,622 $ 224,184 $ 299,408 $ 486,995
</TABLE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The Partnership has expended all of the partners' net commitments available
for property acquisitions and development by acquiring nonoperating interest in
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. 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 nonoperating interests in oil and gas
properties. This source of liquidity and the related results of operations will
decline in future periods as the oil and gas produced from these properties also
declines.
RESULTS OF OPERATIONS
Income from nonoperating interests decreased 42 percent in 1995 over 1994.
Oil and gas sales decreased 32 percent in 1995 vs. 1994. Production volumes
decreased 18 percent due to a 17 percent gas production decrease and a 22
percent oil production decline. Since the Partnership's reserves are 72 percent
gas, the decrease in gas production, due to accelerated production declines on
mature wells, had a major impact on partnership performance. A decline in the
1995 gas prices of 25 percent or $.49/MCF further contributed to the
Partnership's decreased revenues.
Associated amortization expense decreased 17 percent in 1995 when compared
to 1994.
Income from nonoperating interests decreased 14 percent in 1994 over 1993.
Oil and gas sales decreased 17 percent in 1994 vs. 1993. Production volumes
decreased 18 percent due to a 20 percent gas production decrease and a 12
percent oil production decline. Since the partnership's reserves are 72 percent
gas, the decrease in gas production, due to accelerated production declines on
mature wells and production curtailments due to declining prices, had a major
impact on partnership performance. The Partnership experienced a decline in oil
prices of 7 percent or $1.12/BBL which further contributed to the decreased
revenues. An increase in gas prices of 3 percent or $.05/MCF compared to 1993
partially offset the production declines.
Associated amortization expense decreased 13 percent in 1994 when compared
to 1993.
The Partnership recorded an additional provision in amortization in 1995
and 1994 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 paid for oil and gas
properties resulting in a full cost ceiling impairment.
II-2
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
During 1996, Partnership revenues and costs will be shared between the
limited and general partners in a 90:10 ratio, based on the annualized rate of
cash distributions by the Partnership during a certain period prior to December
31, 1995. Based on current oil and gas prices, current levels of oil and gas
production and expected cash distributions during 1996, the MGP anticipates that
the Partnership sharing ratio will continue to be 90:10.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Part IV, Item 14(a) for index to financial statements.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
II-3
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
As a limited partnership, the Registrant has no directors or executive
officers. The business and affairs of the Registrant are managed by Swift as
Managing General Partner. Set forth below is certain information as of March
15, 1996 regarding the directors and executive officers of Swift.
<TABLE>
<CAPTION>
POSITION(S) WITH
NAME AGE SWIFT AND OTHER COMPANIES
---- --- -------------------------
<S> <C> <C>
DIRECTORS
---------
A. Earl Swift 62 President, Chief Executive Officer and
Chairman of the Board
Virgil N. Swift 67 Executive Vice President - Business
Development, Vice Chairman of the Board
G. Robert Evans 64 Director of Swift; Chairman of the Board,
Material Sciences Corporation;
Director, Consolidated Freightways,Inc.,
Fibreboard Corporation, Elco Industries, and
Old Second Bancorp
Raymond O. Loen 71 Director of Swift; President, R. O. Loen
Company
Henry C. Montgomery 60 Director of Swift; Chairman of theBoard,
Montgomery Financial Services Corporation;
Director, Southwall Technology Corporation
Clyde W. Smith, Jr. 47 Director of Swift; President, Somerset
Properties, Inc.
Harold J. Withrow 68 Director of Swift
EXECUTIVE OFFICERS
------------------
Terry E. Swift 40 Executive Vice President, Chief
Operating Officer
John R. Alden 50 Senior Vice President - Finance,
Chief Financial Officer and Secretary
Bruce H. Vincent 48 Senior Vice President - Funds Management
James M. Kitterman 51 Senior Vice President - Operations
Alton D. Heckaman, Jr. 38 Vice President - Finance and
Controller
</TABLE>
III-1
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
From time to time, Swift as Managing General Partner of the Partnership
purchases Units in the Partnership from investors who offer the Units pursuant
to their right of presentment, which purchases are made pursuant to terms set
out in the Partnership's original Limited Partnership Agreement. Due to the
frequency and large number of these transactions, Swift reports these
transactions under Section 16 of the Securities Exchange Act of 1934 on an
annual rather than a monthly basis. In some cases such annual reporting may
constitute a late filing of the required Section 16 reports under the applicable
Section 16 rules.
ITEM 11. EXECUTIVE COMPENSATION
As noted in Item 10, "Directors and Executive Officers of the Registrant,"
above, the Partnership has no executive officers. The executive officers of
Swift and VJM are not compensated by the Partnership.
Certain fees and allowances contemplated by the Limited Partnership
Agreement have been paid by the Partnership to Swift and VJM. See Note (4) in
Notes To Financial Statements (Related-Party Transactions) for further
discussion.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
No single limited partner is known to the Partnership to be the beneficial
owner of more than five percent of the Partnership's Units.
Swift and VJM are not aware of any arrangement, the operation of which may
at a subsequent date result in a change in control of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As noted in Item 10, "Directors and Executive Officers of the Registrant,"
above, the Partnership has no executive officers or directors, and thus has not
engaged in any transactions in which any such person had an interest. The
Partnership is permitted to engage in certain transactions with Swift as
Managing General Partner and VJM as Special General Partner, subject to
extensive guidelines and restrictions are described in the "Conflicts of
Interest" section of the Amended Prospectus contained in the Registration
Statement, which is incorporated herein by reference.
Summarized below are the principal transactions that have occurred between
the Partnership, on one hand, and Swift, VJM and their affiliates, on the other.
CERTAIN TRANSACTIONS WITH GENERAL PARTNERS
1. As described in Item 1, "Business," above, during 1988 the Partnership
entered into an NP/OR Agreement with the Operating Partnership, which is also
managed by Swift and VJM. Pursuant to such NP/OR Agreement, the Operating
Partnership acquired the oil and gas properties described under Item 2 above and
conveyed nonoperating interests therein to the Partnership.
2. Swift acts as operator for many of the wells in which the Partnership
has nonoperating interests and has received compensation for such activities in
accordance with standard industry operating agreements.
3. The Partnership paid to Swift and VJM certain fees as contemplated by
the Limited Partnership Agreement. See Note (4) in Notes To Financial
Statements (Related-Party Transactions) for further discussion.
III-2
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
PART IV
ITEM 14. FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
a(1) FINANCIAL STATEMENTS PAGE NO.
-------------------- --------
Report of Independent Public Accountants IV-2
Balance Sheets as of December 31, 1995 and 1994 IV-3
Statements of Operations for the years ended
December 31, 1995, 1994 and 1993 IV-4
Statements of Partners' Capital for the years ended
December 31, 1995, 1994 and 1993 IV-5
Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993 IV-6
Notes to Financial Statements IV-7
a(2) FINANCIAL STATEMENT SCHEDULES
-----------------------------
All schedules required by the SEC are either inapplicable or the
required information is included in the Financial Statements, the Notes
thereto, or in other information included elsewhere in this the report.
a(3) EXHIBITS
--------
3.1 Limited Partnership Agreement of Swift Energy Managed Pension Assets
Partnership 1988-B, Ltd., dated September 13, 1988. (Form 10-K for
year ended December 31, 1988, Exhibit 3.1).
3.2 Certificate of Limited Partnership of Swift Energy Managed Pension
Assets Partnership 1988-B, Ltd., as filed September 14, 1988, with
the Texas Secretary of State. (Form 10-K for year ended December
31, 1988, Exhibit 3.2).
10.1 Net Profits and Overriding Royalty Interest Agreement between Swift
Energy Managed Pension Assets Partnership 1988-B Ltd. and Swift
Energy Income Partners 1988-C, Ltd. dated October 18, 1988.
99.1 A copy of the following section of the Prospectus dated March 22,
1988, contained in Pre-Effective Amendment No. 1 to Registration
Statement No. 33-19716 on Form S-1 for Swift Energy Managed Pension
Assets Fund I, as filed on November 2, 1988, which have been
incorporated herein by reference: "Proposed Activities"
(pp 38 - 48) and "Conflicts of Interests" (pp. 70-79). (Form 10-K
for year ended December 31, 1989, Exhibit 28.1).
b(1) REPORTS ON FORM 8-K
-------------------
No reports on Form 8-K have been filed during the quarter ended December
31, 1995.
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO
SECTION 12 OF THE ACT.
No annual report to security holders covering the Partnership's 1995 fiscal
year, or proxy statement, form of proxy or other proxy soliciting material has
been sent to Limited Partners of the Partnership.
IV-1
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Swift Energy Managed Pension Assets Partnership 1988-B, Ltd.:
We have audited the accompanying balance sheets of Swift Energy Managed
Pension Assets Partnership 1988-B, Ltd., (a Texas limited partnership) as of
December 31, 1995 and 1994, and the related statements of operations, partners'
capital and cash flows for the years ended December 31, 1995, 1994 and 1993.
These financial statements are the responsibility of the general partner's
management. Our responsibility is to express an opinion on these 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, the financial statements referred to above present fairly,
in all material respects, the financial position of Swift Energy Managed Pension
Assets Partnership 1988-B, Ltd., as of December 31, 1995 and 1994, and the
results of its operations and its cash flows for the years ended December 31,
1995, 1994 and 1993, in conformity with generally accepted accounting
principles.
ARTHUR ANDERSEN LLP
Houston, Texas
February 19, 1996
IV-2
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
<TABLE>
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
ASSETS:
Current Assets:
Cash and cash equivalents $ 1,206 $ 1,140
Nonoperating interests income receivable 27,428 30,729
----------- -----------
Total Current Assets 28,634 31,869
----------- -----------
Nonoperating interests in oil and gas
properties, using full cost accounting 3,363,418 3,349,242
Less-Accumulated amortization (2,737,654) (2,570,881)
----------- -----------
625,764 778,361
----------- -----------
$ 654,398 $ 810,230
----------- -----------
----------- -----------
LIABILITIES AND PARTNERS' CAPITAL:
Current Liabilities:
Accounts payable and accrued liabilities $ -- $ 3,657
Payable related to property capital costs 141,306 127,020
----------- -----------
Total Current Liabilities 141,306 130,677
----------- -----------
Partners' Capital 513,092 679,553
----------- -----------
$ 654,398 $ 810,230
----------- -----------
----------- -----------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
IV-3
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
-------- -------- --------
<S> <C> <C> <C>
REVENUES:
Income from nonoperating interests $122,750 $212,643 $247,522
Interest income 66 42 35
-------- -------- --------
122,816 212,685 247,557
-------- -------- --------
COSTS AND EXPENSES:
Amortization 166,773 252,636 137,747
General and administrative 32,952 43,879 50,370
-------- -------- --------
199,725 296,515 188,117
-------- -------- --------
INCOME (LOSS) $(76,909) $(83,830) $ 59,440
-------- -------- --------
-------- -------- --------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
IV-4
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
STATEMENTS OF PARTNERS' CAPITAL
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
LIMITED GENERAL COMBINING
PARTNERS PARTNERS ADJUSTMENT TOTAL
---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
BALANCE,
DECEMBER 31, 1992 $ 976,623 $ 25,035 $ 87,091 $1,088,749
INCOME (LOSS) 51,641 17,203 (9,404) 59,440
CASH DISTRIBUTIONS (201,600) (22,584) -- (224,184)
---------- -------- -------- ----------
BALANCE,
DECEMBER 31, 1993 826,664 19,654 77,687 924,005
---------- -------- -------- ----------
INCOME (LOSS) (61,307) 13,924 (36,447) (83,830)
CASH DISTRIBUTIONS (146,100) (14,522) -- (160,622)
---------- -------- -------- ----------
BALANCE,
DECEMBER 31, 1994 619,257 19,056 41,240 679,553
---------- -------- -------- ----------
INCOME (LOSS) (68,575) 6,232 (14,566) (76,909)
CASH DISTRIBUTIONS (82,700) (6,852) -- (89,552)
---------- -------- -------- ----------
BALANCE,
DECEMBER 31, 1995 $ 467,982 $ 18,436 $ 26,674 $ 513,092
---------- -------- -------- ----------
---------- -------- -------- ----------
LIMITED PARTNERS' NET INCOME
(LOSS) PER UNIT
1993 $ 1.42
---------
---------
1994 $ (1.69)
---------
---------
1995 $ (1.89)
---------
---------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
IV-5
<PAGE>
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
--------- --------- ---------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Income (Loss) $ (76,909) $ (83,830) $ 59,440
Adjustments to reconcile income (loss)
to net cash provided by operations:
Amortization 166,773 252,636 137,747
Change in assets and liabilities:
(Increase) decrease in nonoperating
interests income receivable 3,301 20,868 (28,711)
Increase (decrease) in accounts
payable and accrued liabilities (3,657) (540) (1,219)
--------- --------- ---------
Net cash provided by (used in)
operating activities 89,508 189,134 167,257
--------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to nonoperating interests
in oil and gas properties (27,984) (69,828) (29,906)
Proceeds from sales of nonoperating
interests in oil and gas properties 13,808 20,506 14,191
Increase in payable related to
property capital costs 14,286 20,852 72,676
--------- --------- ---------
Net cash provided by (used in)
investing activities 110 (28,470) 56,961
--------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions to partners (89,552) (160,622) (224,184)
--------- --------- ---------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 66 42 34
--------- --------- ---------
CASH AND CASH EQUIVALENTS AT BEGINNING
OF YEAR 1,140 1,098 1,064
--------- --------- ---------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 1,206 $ 1,140 $ 1,098
--------- --------- ---------
--------- --------- ---------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
IV-6
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION AND TERMS OF PARTNERSHIP AGREEMENT -
Swift Energy Managed Pension Assets Partnership 1988-B, Ltd., a Texas
limited partnership (the Partnership), was formed on September 14, 1988, for
the purpose of purchasing net profits interests, 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 331
limited partners made total capital contributions of $3,631,145.
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.
Initially, all continuing costs (including 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, as defined, 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. Payout had not
occurred as of December 31, 1995.
(2) 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.
NONOPERATING INTERESTS IN OIL AND GAS PROPERTIES -
For financial reporting purposes, the Partnership follows the
"full-cost" method of accounting for nonoperating interests in oil and gas
properties. 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 nonoperating
interests in oil and gas properties on the units-of-production method. Under
this method, the provision is calculated by multiplying the total unamortized
cost of nonoperating interests in 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 units of proved oil and gas reserves
attributable to the Partnership's nonoperating interests at the beginning of
the period.
IV-7
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The calculation of the "ceiling limitation" and the provision for
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.
STATEMENTS OF CASH FLOWS -
Highly liquid debt instruments with an initial maturity of three months
or less are considered to be cash equivalents.
(3) ACQUISITION OF NONOPERATING INTERESTS IN OIL AND GAS PROPERTY COSTS -
Effective October 18, 1988, the Partnership entered into a Net Profits
and Overriding Royalty Interests Agreement (NP/OR Agreement) with Swift
Energy Income Partners 1988-C, Ltd. (Operating Partnership), managed by
Swift, for the purpose of acquiring interests in producing oil and gas
properties. Under the terms of the NP/OR Agreement, the Partnership has been
conveyed a nonoperating interest 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 as defined.
Property acquisition costs are amounts actually paid by the Operating
Partnership for the properties plus costs incurred by the Operating
Partnership in acquiring the properties and costs related to screening and
evaluation of properties not acquired. In 1995, 1994 and 1993, the
Partnership acquired nonoperating interests in producing oil and gas
properties for $27,984, $69,829 and $29,906, respectively.
During 1995 and 1994, the Partnership's unamortized oil and gas property
costs exceeded the quarterly calculations of the "ceiling limitation"
resulting in an additional provision for amortization of $67,130 and
$132,256, respectively. In addition, the limited partners' share of
unamortized oil and gas property costs exceeded their "ceiling limitation" in
1995 and 1994 resulting in valuation allowances of $58,215 and $104,530,
respectively. These amounts are included in the income (loss) attributable
to the limited partners shown in the statements of partners' capital together
with a "combining adjustment" for the differences between the limited
partners' valuation allowances and the Partnership's valuation allowances.
The "combining adjustment" changes quarterly as the Partnership's total
amortization provision is more or less than the combined amortization
provision attributable to general and limited partners.
(4) RELATED-PARTY TRANSACTIONS -
An affiliate of the Special General Partner, as Dealer Manager, received
$88,279 for managing and overseeing the offering of limited partnership units.
A one-time management fee of $90,779 was paid to Swift in 1988 for
services performed for the Partnership. During 1995, 1994 and 1993, the
Partnership paid Swift $17,916, $27,216 and $34,151, respectively, as general
and administrative overhead allowances.
(5) FEDERAL INCOME TAXES -
The Partnership is not a tax-paying entity. No provision is made in the
accounts of the Partnership for federal or state income taxes, since such
taxes are liabilities of the individual partners, and the amounts thereof
depend upon their respective tax situations.
The tax returns and the amount of distributable Partnership income are
subject to examination by the federal and state taxing authorities. If the
Partnership's royalty income for federal income tax purposes is ultimately
changed by the taxing authorities, the tax liability of the limited partners
could be changed accordingly. Royalty income reported on the Partnership's
federal return of income for the years ended December 31, 1995, 1994 and 1993
was $53,916, $109,445 and $174,340, respectively. The difference between
royalty income for federal income tax purposes reported by the Partnership
and income or loss from nonoperating interests reported herein primarily
results from the exclusion of amortization (as described below) from ordinary
income reported in the Partnership's federal return of income.
IV-8
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
For federal income tax purposes, amortization with respect to
nonoperating interests in oil and gas properties is computed separately by
the partners and not by the Partnership. Since the amount of amortization on
nonoperating interests in oil and gas properties is not computed at the
Partnership level, amortization is not included in the Partnership's income
for federal income tax purposes but is charged directly to the partners'
capital accounts to the extent of the cost of the nonoperating interests in
oil and gas properties, and thus is treated as a separate item on the
partners' Schedule K-1. Amortization for federal income tax purposes may
vary from that computed for financial reporting purposes in cases where a
ceiling adjustment is recorded, as such amount is not recognized for tax
purposes.
(6) 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.
The Partnership extends credit 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.
(7) 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.
IV-9
<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-B, LTD.
(Registrant)
By: SWIFT ENERGY COMPANY
General Partner
Date: March 15, 1996 By: s/b A. Earl Swift
----------------------- ----------------------------------
A. Earl Swift
President
Date: March 15, 1996 By: s/b John R. Alden
----------------------- ----------------------------------
John R. Alden
Principal Financial Officer
Date: March 15, 1996 By: s/b Alton D. Heckaman, Jr.
----------------------- ----------------------------------
Alton D. Heckaman, Jr.
Principal Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
SWIFT ENERGY MANAGED PENSION
ASSETS PARTNERSHIP 1988-B, LTD.
(Registrant)
By: SWIFT ENERGY COMPANY
General Partner
Date: March 15, 1996 By: s/b A. Earl Swift
----------------------- -----------------------------------
A. Earl Swift
Director and Principal
Executive Officer
Date: March 15, 1996 By: s/b Virgil N. Swift
----------------------- -----------------------------------
Virgil N. Swift
Director and Executive
Vice President - Business
Development
IV-10
<PAGE>
SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-B, LTD.
Date: March 15, 1996 By: s/b G. Robert Evans
----------------------- -----------------------------------
G. Robert Evans
Director
Date: March 15, 1996 By: s/b Raymond O. Loen
----------------------- -----------------------------------
Raymond O. Loen
Director
Date: March 15, 1996 By: s/b Henry C. Montgomery
----------------------- -----------------------------------
Henry C. Montgomery
Director
Date: March 15, 1996 By: s/b Clyde W. Smith, Jr.
----------------------- -----------------------------------
Clyde W. Smith, Jr.
Director
Date: March 15, 1996 By: s/b Harold J. Withrow
----------------------- -----------------------------------
Harold J. Withrow
Director
IV-11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Swift
Energy Managed Pension Assets Partnership 1988-B, LTD. balance sheet and
statement of operations contained in its Form 10-K for the year ended
December 31, 1995 and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 1,206
<SECURITIES> 0
<RECEIVABLES> 27,428
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 28,634
<PP&E> 3,363,418
<DEPRECIATION> (2,737,654)
<TOTAL-ASSETS> 654,398
<CURRENT-LIABILITIES> 141,306
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 513,092
<TOTAL-LIABILITY-AND-EQUITY> 654,398
<SALES> 122,750
<TOTAL-REVENUES> 122,816
<CGS> 0
<TOTAL-COSTS> 166,773<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (76,909)
<INCOME-TAX> 0
<INCOME-CONTINUING> (76,909)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (76,909)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Includes lease operating expense, production taxes, and depreciation,
depletion and amortization expense. Excludes general and administrative
and interest expense.
</FN>
</TABLE>
