UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
/ x / Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 1996
or
/ / Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the transition period from _______ to _______
Commission File No. 33-26097-07
PARKER & PARSLEY 90-B, L.P.
(Exact name of Registrant as specified in its charter)
Delaware 75-2329287
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
303 West Wall, Suite 101, Midland, Texas 79701
(Address of principal executive offices) (Zip code)
Registrant's Telephone Number, including area code : (915) 683-4768
Not applicable
(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 1 of 11 pages.
-There are no exhibits-
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PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
Part I. Financial Information
Item 1. Financial Statements
BALANCE SHEETS
June 30, December 31,
1996 1995
------------ ------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents, including interest
bearing deposits of $349,705 at June 30 and
$288,853 at December 31 $ 349,892 $ 289,053
Accounts receivable - oil and gas sales 349,701 305,505
----------- -----------
Total current assets 699,593 594,558
Oil and gas properties - at cost, based on the
successful efforts accounting method 25,933,225 25,958,413
Accumulated depletion (17,197,992) (16,839,804)
----------- -----------
Net oil and gas properties 8,735,233 9,118,609
----------- -----------
$ 9,434,826 $ 9,713,167
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable - affiliate $ 116,309 $ 196,847
Partners' capital:
Limited partners (32,264 interests) 9,225,328 9,421,164
Managing general partner 93,189 95,156
----------- -----------
9,318,517 9,516,320
----------- -----------
$ 9,434,826 $ 9,713,167
=========== ===========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended Six months ended
June 30, June 30,
--------------------- -----------------------
1996 1995 1996 1995
--------- --------- ---------- ----------
Revenues:
Oil and gas sales $ 905,148 $ 806,618 $1,725,231 $1,652,158
Interest income 4,875 4,822 8,661 8,768
Salvage income from equipment
disposals - - 7,405 -
-------- -------- --------- ---------
Total revenues 910,023 811,440 1,741,297 1,660,926
Costs and expenses:
Production costs 350,763 359,701 713,010 750,253
General and administrative
expenses 30,208 24,199 54,810 52,050
Depletion 176,025 196,536 360,884 403,932
(Gain) loss on abandoned
property 2,017 (8,135) 2,017 (8,135)
Abandoned property costs - 5,652 - 5,652
Amortization of organization
costs - 3,400 - 6,798
-------- -------- --------- ---------
Total costs and expenses 559,013 581,353 1,130,721 1,210,550
-------- -------- --------- ---------
Net income $ 351,010 $ 230,087 $ 610,576 $ 450,376
======== ======== ========= =========
Allocation of net income:
Managing general partner $ 3,510 $ 2,335 $ 6,106 $ 4,572
======== ======== ========= =========
Limited partners $ 347,500 $ 227,752 $ 604,470 $ 445,804
======== ======== ========= =========
Net income per limited
partnership interest $ 10.78 $ 7.06 $ 18.74 $ 13.82
======== ======== ========= =========
Distributions per limited
partnership interest $ 13.59 $ 13.13 $ 24.80 $ 26.54
======== ======== ========= =========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
(Unaudited)
Managing
general Limited
partner partners Total
----------- ----------- -----------
Balance at January 1, 1995 $ 106,047 $10,509,618 $10,615,665
Distributions (8,650) (856,330) (864,980)
Net income 4,572 445,804 450,376
---------- ---------- ----------
Balance at June 30, 1995 $ 101,969 $10,099,092 $10,201,061
========== ========== ==========
Balance at January 1, 1996 $ 95,156 $ 9,421,164 $ 9,516,320
Distributions (8,073) (800,306) (808,379)
Net income 6,106 604,470 610,576
---------- ---------- ----------
Balance at June 30, 1996 $ 93,189 $ 9,225,328 $ 9,318,517
========== ========== ==========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Six months ended
June 30,
1996 1995
--------- ---------
Cash flows from operating activities:
Net income $ 610,576 $ 450,376
Adjustments to reconcile net income to net
cash provided by operating activities:
Depletion and amortization 360,884 410,730
Salvage income from equipment disposals (7,405) -
(Gain) loss on abandoned property 2,017 (8,135)
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (44,196) 10,498
Increase (decrease) in accounts payable (51,637) 57,598
-------- --------
Net cash provided by operating activities 870,239 921,067
Cash flows from investing activities:
Additions to oil and gas properties (8,426) (10,007)
Proceeds from salvage income on equipment disposals 7,405 -
Proceeds from equipment salvage on abandoned property - 2,850
-------- --------
Net cash used in investing activities (1,021) (7,157)
Cash flows from financing activities:
Cash distributions to partners (808,379) (864,980)
-------- --------
Net increase in cash and cash equivalents 60,839 48,930
Cash and cash equivalents at beginning of period 289,053 180,890
-------- --------
Cash and cash equivalents at end of period $ 349,892 $ 229,820
======== ========
The financial information included herein has been prepared by
management without audit by independent public accountants.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
(Unaudited)
NOTE 1.
Parker & Parsley 90-B, L.P. (the "Registrant") is a limited partnership
organized in 1990 under the laws of the State of Delaware.
The Registrant engages primarily in oil and gas development and production in
Texas and is not involved in any industry segment other than oil and gas.
NOTE 2.
In the opinion of management, the Registrant's unaudited financial statements as
of June 30, 1996 include all adjustments and accruals consisting only of normal
recurring accrual adjustments which are necessary for a fair presentation of the
results for the interim period. However, these interim results are not
necessarily indicative of results for a full year.
The financial statements should be read in conjunction with the financial
statements and the notes thereto contained in the Registrant's Report on Form
10-K for the year ended December 31, 1995, as filed with the Securities and
Exchange Commission, a copy of which is available upon request by writing to
Steven L. Beal, Senior Vice President, 303 West Wall, Suite 101, Midland, Texas
79701.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (1)
Results of Operations
Six months ended June 30, 1996 compared with six months ended
June 30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $1,725,231 from $1,652,158
for the six months ended June 30, 1996 and 1995, respectively, an increase of
4%. The increase in revenues resulted from a 16% increase in the average price
received per barrel of oil and a 29% increase in the average price received per
mcf of gas, offset by a 13% decline in barrels of oil produced and sold and an
11% decline in mcf of gas produced and sold. For the six months ended June 30,
1996, 64,600 barrels of oil were sold compared to 73,939 for the same period in
1995, a decrease of 9,339 barrels. For the six months ended June 30, 1996,
175,687 mcf of gas were sold compared to 197,260 for the same period in 1995, a
decrease of 21,573 mcf. The decrease in production volumes was primarily due to
the decline characteristics of the Registrant's oil and gas properties.
6
<PAGE>
Management expects a certain amount of decline in production to continue in the
future until the Registrant's economically recoverable reserves are fully
depleted.
The average price received per barrel of oil increased $2.88 from $17.59 for the
six months ended June 30, 1995 to $20.47 for the same period in 1996 while the
average price received per mcf of gas increased from $1.78 for the six months
ended June 30, 1995 to $2.29 for the same period in 1996. The market price for
oil and gas has been extremely volatile in the past decade, and management
expects a certain amount of volatility to continue in the foreseeable future.
The Registrant may therefore sell its future oil and gas production at average
prices lower or higher than that received during the six months ended June 30,
1996.
Salvage income totaling $7,405 was received during the six months ended June 30,
1996, attributable to credits received from the disposal of oil and gas
equipment on one well that was plugged and abandoned in a prior year.
Costs and Expenses:
Total costs and expenses decreased to $1,130,721 for the six months ended June
30, 1996 as compared to $1,210,550 for the same period in 1995, a decrease of
$79,829, or 7%. The decrease was due to declines in production costs, depletion,
abandoned property costs and amortization of organization costs, offset by
increases in general and administrative expenses ("G&A") and loss on abandoned
property.
Production costs were $713,010 for the six months ended June 30, 1996 and
$750,253 for the same period in 1995, resulting in a $37,243 decrease, or 5%.
The decrease was the result of less well repair and maintenance costs, offset by
an increase in workover costs incurred in an effort to stimulate production.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A increased, in aggregate, 5% from $52,050 for the six months ended
June 30, 1995 to $54,810 for the same period in 1996.
Depletion was $360,884 for the six months ended June 30, 1996 compared to
$403,932 for the same period in 1995. This represented a decrease in depletion
of $43,048, or 11%, primarily attributable to the adoption of the provisions of
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("FAS 121") effective the fourth quarter of 1995 and the reduction of net
depletable basis resulting from the charge taken upon such adoption. Depletion
was computed property-by-property utilizing the unit-of-production method based
upon the dominant mineral produced, generally oil. Oil production decreased
9,339 barrels for the six months ended June 30, 1996 from the same period in
1995, while oil reserves of barrels were revised downward by 213,660 barrels, or
11%.
A loss on abandoned property of $2,017 was recognized during the six months
ended June 30, 1996. This loss resulted from the abandonment of a saltwater
7
<PAGE>
disposal well. A gain on abandoned property of $8,135 was recognized during the
six months ended June 30, 1995. This gain was the result of proceeds received
from equipment salvage on one fully depleted abandoned property. Abandoned
property costs of $5,652 were incurred on one well abandoned during the six
months ended June 30, 1995. There were no abandoned property costs for the same
period in 1996.
Three months ended June 30, 1996 compared with three months ended
June 30, 1995
Revenues:
The Registrant's oil and gas revenues increased to $905,148 from $806,618 for
the three months ended June 30, 1996 and 1995, respectively, an increase of 12%.
The increase in revenues resulted from a 22% increase in the average price
received per barrel of oil and a 45% increase in the average price received per
mcf of gas, offset by a 12% decline in barrels of oil produced and sold and an
8% decline in mcf of gas produced and sold. For the three months ended June 30,
1996, 31,694 barrels of oil were sold compared to 36,043 for the same period in
1995, a decrease of 4,349 barrels. For the three months ended June 30, 1996,
89,543 mcf of gas were sold compared to 97,416 for the same period in 1995, a
decrease of 7,873 mcf. The decrease in production volumes was due to the decline
characteristics of the Registrant's oil and gas properties.
The average price received per barrel of oil increased $3.93 from $18.02 for the
three months ended June 30, 1996 to $21.95 for the same period in 1996 while the
average price received per mcf of gas increased from $1.61 during the three
months ended June 30, 1995 to $2.34 in 1996.
Costs and Expenses:
Total costs and expenses decreased to $559,013 for the three months ended June
30, 1996 as compared to $581,353 for the same period in 1995, a decrease of
$22,340, or 4%. This decrease was due to declines in production costs,
depletion, amortization of organization costs and abandoned property costs,
offset by increases in G&A and loss on abandoned property.
Production costs were $350,763 for the three months ended June 30, 1996 and
$359,701 for the same period in 1995 resulting in an $8,938 decrease, or 2%. The
decrease was the result of less well repair and maintenance costs, offset by an
increase in workover costs incurred in an effort to stimulate well production.
G&A's components are independent accounting and engineering fees, computer
services, postage and managing general partner personnel costs. During this
period, G&A increased, in aggregate, 25% from $24,199 for the three months ended
June 30, 1995 to $30,208 for the same period in 1996.
Depletion was $176,025 for the three months ended June 30, 1996 compared to
$196,536 for the same period in 1995. This represented a decrease in depletion
of $20,511, or 10%, primarily attributable to the adoption of FAS 121 the fourth
quarter of 1995, as discussed previously. Oil production decreased 4,349 barrels
for the three months ended June 30, 1996 from the same period in 1995.
8
<PAGE>
A loss on abandoned property of $2,017 was recognized during the three months
ended June 30, 1996. This loss resulted from the abandonment of a saltwater
disposal well. A gain on abandoned property of $8,135 was recognized during the
three months ended June 30, 1995. This gain was the result of proceeds received
from equipment salvage on one fully depleted abandoned property. Abandoned
property costs of $5,652 were incurred on one well abandoned during the three
months ended June 30, 1995. There were no abandoned property costs for the same
period in 1996.
Liquidity and Capital Resources
Net Cash Provided by Operating Activities
Net cash provided by operating activities decreased during the six months ended
June 30, 1996 $50,828 from the same period ended June 30, 1995. This decrease
was primarily due to an increase in production costs paid, offset by an increase
in oil and gas sales.
Net Cash Used in Investing Activities
The Registrant's principal investing activities for the six months ended June
30, 1996 and 1995 included expenditures related to equipment replacement on
various oil and gas properties.
Proceeds of $7,405 were received during the six months ended June 30, 1996 from
the sale of oil and gas equipment on one well abandoned in a prior year.
Proceeds of $2,850 were received from the salvage of equipment on one well
abandoned during the six months ended June 30, 1995.
Net Cash Used in Financing Activities
Cash was sufficient for the six months ended June 30, 1996 to cover
distributions to the partners of $808,379 of which $800,306 was distributed to
the limited partners and $8,073 to the managing general partner. For the same
period ended June 30, 1995, cash was sufficient for distributions to the
partners of $864,980 of which $856,330 was distributed to the limited partners
and $8,650 to the managing general partner.
It is expected that future net cash provided by operating activities will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.
- ---------------
(1) "Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains forward looking statements that involve
risks and uncertainties. Accordingly, no assurances can be given that the
actual events and results will not be materially different than the
anticipated results described in the forward looking statements.
9
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - none
(b) Form 8-K - none
10
<PAGE>
PARKER & PARSLEY 90-B, L.P.
(A Delaware Limited Partnership)
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PARKER & PARSLEY 90-B, L.P.
By: Parker & Parsley Development L.P.,
Managing General Partner
By: Parker & Parsley Petroleum USA, Inc.
("PPUSA"), General Partner
Dated: August 9, 1996 By: /s/ Steven L. Beal
-----------------------------------------
Steven L. Beal, Senior Vice President
and Chief Financial Officer of PPUSA
11
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000844618
<NAME> 90B.TXT
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 349,892
<SECURITIES> 0
<RECEIVABLES> 349,701
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 699,593
<PP&E> 25,933,225
<DEPRECIATION> 17,197,992
<TOTAL-ASSETS> 9,434,826
<CURRENT-LIABILITIES> 116,309
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 9,318,517
<TOTAL-LIABILITY-AND-EQUITY> 9,434,826
<SALES> 1,725,231
<TOTAL-REVENUES> 1,741,297
<CGS> 0
<TOTAL-COSTS> 1,130,721
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 610,576
<INCOME-TAX> 0
<INCOME-CONTINUING> 610,576
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 610,576
<EPS-PRIMARY> 18.74
<EPS-DILUTED> 0
</TABLE>
