FORM 10-K405
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
Commission File Number: P-1: 0-17800; P-2: 0-17801;
P-3: 0-18306; P-4: 0-18308; P-5: 0-18637; P-6: 0-18937
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-6
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(Exact name of Registrant as specified in its Articles)
P-1: 73-1330245
P-2: 73-1330625
P-1 and P-2: P-3: 73-1336573
Texas P-4: 73-1341929
P-3 through P-6: P-5: 73-1353774
Oklahoma P-6: 73-1357375
- --------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Two West Second Street, Tulsa, Oklahoma 74103
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (918) 583-1791
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Depositary Units of Limited Partnership interest
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 the
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 (Sec. 229.405 of this chapter) 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.
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Disclosure is not contained herein
-----
X Disclosure is contained herein
-----
The Depositary Units are not publicly traded, therefore, Registrant cannot
compute the aggregate market value of the voting units held by non-affiliates of
the Registrant.
DOCUMENTS INCORPORATED BY REFERENCE: None
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FORM 10-K405
TABLE OF CONTENTS
PART I.......................................................................4
ITEM 1. BUSINESS...................................................4
ITEM 2. PROPERTIES................................................10
ITEM 3. LEGAL PROCEEDINGS.........................................22
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF LIMITED PARTNERS.......22
PART II.....................................................................22
ITEM 5. MARKET FOR UNITS AND RELATED LIMITED PARTNER MATTERS......22
ITEM 6. SELECTED FINANCIAL DATA...................................25
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.......................32
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK........................................ 50
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA...............50
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.......................50
PART III....................................................................50
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE GENERAL PARTNER...50
ITEM 11. EXECUTIVE COMPENSATION....................................52
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT................................................59
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS............61
PART IV.....................................................................63
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
ON FORM 8-K...............................................63
SIGNATURES..............................................................68
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PART I.
ITEM 1. BUSINESS
General
The Geodyne Institutional/Pension Energy Income P-1 Limited Partnership
(the "P-1 Partnership") and Geodyne Institutional/Pension Energy Income P-2
Limited Partnership (the "P-2 Partnership") are limited partnerships formed
under the Texas Revised Limited Partnership Act and the Geodyne
Institutional/Pension Energy Income Limited Partnership P-3 (the "P-3
Partnership"), Geodyne Institutional/Pension Energy Income Limited Partnership
P-4 (the "P-4 Partnership"), Geodyne Institutional/Pension Energy Income Limited
Partnership P-5 (the "P-5 Partnership"), and Geodyne Institutional/Pension
Energy Income Limited Partnership P-6 (the "P-6 Partnership") are limited
partnerships formed under the Oklahoma Revised Uniform Limited Partnership Act
(collectively, the "Partnerships"). Each Partnership is composed of Geodyne
Resources, Inc. ("Geodyne"), a Delaware corporation, as the general partner,
Geodyne Institutional Depository Company, a Delaware corporation, as the sole
initial limited partner, and public investors as substitute limited partners
(the "Limited Partners"). The Partnerships commenced operations on the dates set
forth below:
Date of
Partnership Activation
----------- -----------------
P-1 October 25, 1988
P-2 February 9, 1989
P-3 May 10, 1989
P-4 November 21, 1989
P-5 February 27, 1990
P-6 September 5, 1990
Immediately following activation, each Partnership invested as a general
partner in a separate Oklahoma general partnership which actually conducts the
Partnerships' operations. Geodyne serves as managing partner of such general
partnerships. Unless the context indicates otherwise, all references to any
single Partnership or all of the Partnerships in this Annual Report on Form
10-K405 ("Annual Report") are references to the Partnership and its related
general partnership, collectively. In addition, unless the context indicates
otherwise, all references to the "General Partner" in this Annual Report are
references to Geodyne as the general partner of the Partnerships, and as the
managing partner of the related general partnerships.
The General Partner currently serves as general partner of 26 limited
partnerships, including the Partnerships. The General Partner is a wholly-owned
subsidiary of Samson Investment
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Company. Samson Investment Company and its various corporate subsidiaries,
including the General Partner (collectively "Samson"), are primarily engaged in
the production and development of and exploration for oil and gas reserves and
the acquisition and operation of producing properties. At December 31, 1999,
Samson owned interests in approximately 14,000 oil and gas wells located in 17
states of the United States and the countries of Canada, Venezuela, and Russia.
At December 31, 1999, Samson operated approximately 3,400 oil and gas wells
located in 15 states of the United States, as well as Canada, Venezuela, and
Russia.
The Partnerships are currently engaged in the business of owning net
profits and royalty interests in oil and gas properties located in the
continental United States. Most of the net profits interests acquired by the
Partnerships have been carved out of working interests in producing properties
("Working Interests") which were acquired by affiliated oil and gas investment
programs (the "Affiliated Programs"). Net profits interests entitle the
Partnerships to a share of net revenues from producing properties measured by a
specific percentage of the net profits realized by such Affiliated Programs.
Except where otherwise noted, references to certain operational activities of
the Partnerships are actually the activities of the Affiliated Programs. As the
holder of a net profits interest, a Partnership is not liable to pay any amount
by which oil and gas operating costs and expenses exceed revenues for any
period, although any deficit, together with interest, is applied to reduce the
amounts payable to the Partnership in subsequent periods. As used throughout
this Annual Report, the Partnerships' net profits and royalty interests in oil
and gas sales will be referred to as "Net Profits" and the Partnerships' net
profits and royalty interests in oil and gas properties will be collectively
referred to as "Net Profits Interests."
In order to prudently manage the properties which are burdened by the
Partnerships' Net Profits Interests, it may be appropriate for drilling
operations to be conducted on such properties. Since the Partnerships' Net
Profits are calculated after considering such costs, the Partnerships also
indirectly engage in development drilling.
As limited partnerships, the Partnerships have no officers, directors, or
employees. They rely instead on the personnel of the General Partner and the
other Samson Companies. As of February 15, 2000, Samson employed approximately
920 persons. No employees are covered by collective bargaining agreements, and
management believes that Samson provides a sound employee relations environment.
For information regarding the executive officers of the General Partner, see
"Item 10. Directors and Executive Officers of the General Partner."
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The General Partner's and the Partnerships' principal place of business is
located at Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103, and
their telephone number is (918) 583-1791 or (888) 436-3963 [(888) GEODYNE].
Funding
Although the partnership agreement for each Partnership (the "Partnership
Agreement") permits each Partnership to incur borrowings, operations and
expenses are currently funded out of revenues from each Partnership's Net
Profits Interests. The General Partner may, but is not required to, advance
funds to a Partnership for the same purposes for which Partnership borrowings
are authorized.
Principal Products Produced and Services Rendered
The Partnerships' sole business is the holding of certain Net Profits
Interests. The Partnerships do not refine or otherwise process crude oil and
condensate. The Partnerships do not hold any patents, trademarks, licenses, or
concessions and are not a party to any government contracts. The Partnerships
have no backlog of orders and do not participate in research and development
activities. The Partnerships are not presently encountering shortages of
oilfield tubular goods, compressors, production material, or other equipment.
Competition and Marketing
The domestic oil and gas industry is highly competitive, with a large
number of companies and individuals engaged in the exploration and development
of oil and gas properties. The ability of the Partnerships to produce and market
oil and gas profitably depends on a number of factors that are beyond the
control of the Partnerships. These factors include worldwide political
instability (especially in oil-producing regions), United Nations export
embargoes, the supply and price of foreign imports of oil and gas, the level of
consumer product demand (which can be heavily influenced by weather patterns),
government regulations and taxes, the price and availability of alternative
fuels, the overall economic environment, and the availability and capacity of
transportation and processing facilities. The effect of these factors on future
oil and gas industry trends cannot be accurately predicted or anticipated.
The most important variable affecting the Partnerships' revenues is the
prices received for the sale of oil and gas. Predicting future prices is not
possible. Concerning past trends, average yearly wellhead gas prices in the
United States have been volatile for many years. Over the past ten years such
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average prices have generally been in the $1.40 to $2.40 per Mcf range. Gas
prices are currently in the upper end of this range.
Substantially all of the Partnerships' gas reserves are being sold on the
"spot market." Prices on the spot market are subject to wide seasonal and
regional pricing fluctuations due to the highly competitive nature of the spot
market. In addition, such spot market sales are generally short-term in nature
and are dependent upon the obtaining of transportation services provided by
pipelines. Spot prices for the Partnerships' gas increased from approximately
$2.03 per Mcf at December 31, 1998 to approximately $2.24 per Mcf at December
31, 1999. Such prices were on an MMBTU basis and differ from the prices actually
received by the Partnerships due to transportation and marketing costs, BTU
adjustments, and regional price and quality differences.
For the past ten years, average oil prices have generally been in the
$16.00 to $24.00 per barrel range, but have been extremely volatile over the
past two years. Due to global consumption and supply trends as well as a
slowdown in Asian energy demand, oil prices in late 1997 and early 1998 reached
historically low levels, dropping to as low as approximately $9.25 per barrel.
However, production curtailment agreements among major oil producing nations
have caused recent oil prices to climb to over $24.00 per barrel in some
markets. It is not known whether this trend will continue. Prices for the
Partnerships' oil increased from approximately $9.50 per barrel at December 31,
1998 to approximately $22.75 per barrel at December 31, 1999.
Future prices for both oil and gas will likely be different from the
prices in effect on December 31, 1999. Management is unable to predict whether
future oil and gas prices will (i) stabilize, (ii) increase, or (iii) decrease.
Significant Customers
The following customers accounted for ten percent or more of the oil and
gas sales attributable to the Partnerships' Net Profits Interests during the
year ended December 31, 1999:
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Partnership Customer Percentage
----------- ------------------------ ----------
P-1 El Paso Energy Marketing
Company ("El Paso") 24.4%
Chevron U.S.A., Inc.
("Chevron") 12.0%
P-2 El Paso 23.6%
Chevron 10.3%
Texaco Exploration and
Production, Inc. ("Texaco") 10.1%
P-3 El Paso 23.4%
Texaco 10.1%
Chevron 10.1%
P-4 El Paso 28.7%
Valero Industrial Gas LP 25.4%
Phibro Energy, Inc. 21.3%
P-5 El Paso 77.8%
P-6 El Paso 36.6%
HPL Resources Company 15.4%
Tejas Gas Marketing
Company 13.0%
In the event of interruption of purchases by one or more of these
significant customers or the cessation or material change in availability of
open access transportation by pipeline transporters, the Partnerships may
encounter difficulty in marketing gas and in maintaining historic sales levels.
Management does not expect any of its open access transporters to seek
authorization to terminate their transportation services. Even if the services
were terminated, management believes that alternatives would be available
whereby the Partnerships would be able to continue to market their gas.
The Partnerships' principal customers for crude oil production are
refiners and other companies which have pipeline facilities near the producing
properties in which the Partnerships own Net Profits Interests. In the event
pipeline facilities are not conveniently available to production areas, crude
oil is usually trucked by purchasers to storage facilities.
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Oil, Gas, and Environmental Control Regulations
Regulation of Production Operations -- The production of oil and gas is
subject to extensive federal and state laws and regulations governing a wide
variety of matters, including the drilling and spacing of wells, allowable rates
of production, prevention of waste and pollution, and protection of the
environment. In addition to the direct costs borne in complying with such
regulations, operations and revenues may be impacted to the extent that certain
regulations limit oil and gas production to below economic levels.
Regulation of Sales and Transportation of Oil and Gas -- Sales of crude
oil and condensate are made at market prices and are not subject to price
controls. The sale of gas may be subject to both federal and state laws and
regulations. The provisions of these laws and regulations are complex and affect
all who produce, resell, transport, or purchase gas. Although virtually all of
the natural gas production affecting the Partnerships is not subject to price
regulation, other regulations affect the availability of gas transportation
services and the ability of gas consumers to continue to purchase or use gas at
current levels. Accordingly, such regulations may have a material effect on the
Partnerships' Net Profits and projections of future Net Profits.
Future Legislation -- Legislation affecting the oil and gas industry is
under constant review for amendment or expansion. Because such laws and
regulations are frequently amended or reinterpreted, management is unable to
predict what additional energy legislation may be proposed or enacted or the
future cost and impact of complying with existing or future regulations.
Regulation of the Environment - Oil and gas operations are subject to
numerous laws and regulations governing the discharge of materials into the
environment or otherwise relating to environmental protection. Compliance with
such laws and regulations, together with any penalties resulting from
noncompliance, may decrease the Partnerships' Net Profits. Management
anticipates that various local, state, and federal environmental control
agencies will have an increasing impact on oil and gas operations.
Insurance Coverage
Exploration for and production of oil and gas are subject to many inherent
risks, including blowouts, pollution, fires, and other casualties. The
Partnerships maintain insurance coverage as is customary for entities of a
similar size engaged in similar operations, but losses can occur from
uninsurable risks or in amounts in excess of existing insurance coverage. The
occurrence of an event which is not fully covered by insurance could have a
material adverse effect on the Partnerships' financial condition
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and results of operations in that it could negatively impact the cash flow
received from the Net Profits Interests.
ITEM 2. PROPERTIES
Well Statistics
The following table sets forth the number of productive wells in which the
Partnerships had a Net Profits Interest as of December 31, 1999.
P/ship Number of Wells(1)
------ -----------------------------
Total Oil Gas
----- ----- -----
P-1 953 758 195
P-2 996 781 215
P-3 996 749 247
P-4 190 100 90
P-5 74 23 51
P-6 119 34 85
- ---------------
(1) The designation of a well as an oil well or gas well is made by the
General Partner based on the relative amount of oil and gas reserves for
the well. Regardless of a well's oil or gas designation, it may produce
oil, gas, or both oil and gas.
Drilling Activities
During 1999 the P-1, P-2, P-3, and P-4 Partnerships indirectly
participated (through their Net Profits Interests) in the developmental drilling
activities described below.
Revenue
P/ship Well Name County St. Interest Type Status
- ------ --------- ------ ---- -------- ---- ------
P-1 Joe No. 1-25 Caddo OK .00183 Gas Unknown
Daberry No. 5-1 Wheeler TX Unknown Gas In Progress
Coltharp No. 3-51 Wheeler TX .00048 Gas Producing
Blankenship No. 2 Wheeler TX .01486 Gas Producing
Wolfe No. 5 Winkler TX .00372 Gas Producing
P-2 Joe No. 1-25 Caddo OK .00199 Gas Unknown
Daberry No. 5-1 Wheeler TX Unknown Gas In Progress
Coltharp No. 3-51 Wheeler TX .00032 Gas Producing
Blankenship No. 2 Wheeler TX .01014 Gas Producing
Wolfe No. 5 Winkler TX .00254 Gas Producing
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Revenue
P/ship Well Name County St. Interest Type Status
- ------ --------- ------ ---- -------- ---- ------
P-3 Joe No. 1-25 Caddo OK .00376 Gas Unknown
Daberry No. 5-1 Wheeler TX Unknown Gas In Progress
Coltharp No. 3-51 Wheeler TX .00060 Gas Producing
Blankenship No. 2 Wheeler TX .01872 Gas Producing
Wolfe No. 5 Winkler TX .00468 Gas Producing
P-4 Joe No. 1-25 Caddo OK .00333 Gas Unknown
BMT No. 13 Webb TX .00233 Gas Producing
Hachar No. 35 Webb TX .00350 Gas Producing
The P-5 and P-6 Partnerships did not participate in any drilling activities
during 1999.
Oil and Gas Production, Revenue, and Price History
The following tables set forth certain historical information concerning
the oil (including condensates) and gas production attributable to the
Partnerships' Net Profits Interests, revenues attributable to such production,
and certain price information.
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Net Production Data
P-1 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 24,737 26,676 32,044
Gas (Mcf) 357,439 321,426 357,516
Oil and gas sales(1):
Oil $ 412,946 $ 357,439 $ 598,856
Gas 665,565 585,775 813,010
--------- --------- ---------
Total $1,078,511 $ 943,214 $1,411,866
========= ========= =========
Average sales price:
Per barrel of oil $16.69 $13.40 $18.69
Per Mcf of gas 1.86 1.82 2.27
- ----------
(1) These amounts differ from the Net Profits included in the P-1
Partnership's financial statements because they do not reflect the offset
of $275,972, $248,295, and $347,761, respectively, of production expenses
incurred by the Affiliated Programs.
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Net Production Data
P-2 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 17,583 18,652 22,873
Gas (Mcf) 289,443 266,232 301,132
Oil and gas sales(1):
Oil $293,110 $249,655 $ 428,036
Gas 556,043 492,065 697,928
-------- -------- ---------
Total $849,153 $741,720 $1,125,964
======== ======== =========
Average sales price:
Per barrel of oil $16.67 $13.38 $18.71
Per Mcf of gas 1.92 1.85 2.32
- ----------
(1) These amounts differ from the Net Profits included in the P-2
Partnership's financial statements because they do not reflect the offset
of $230,263, $203,535, and $289,470, respectively, of production expenses
incurred by the Affiliated Programs.
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Net Production Data
P-3 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 32,552 34,533 42,259
Gas (Mcf) 543,312 496,649 565,052
Oil and gas sales(1):
Oil $ 542,233 $ 462,244 $ 791,047
Gas 1,044,195 919,875 1,312,229
--------- --------- ---------
Total $1,586,428 $1,382,119 $2,103,276
========= ========= =========
Average sales price:
Per barrel of oil $16.66 $13.39 $18.72
Per Mcf of gas 1.92 1.85 2.32
- ----------
(1) These amounts differ from the Net Profits included in the P-3
Partnership's financial statements because they do not reflect the offset
of $430,614, $384,655, and $543,301, respectively, of production expenses
incurred by the Affiliated Programs.
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Net Production Data
P-4 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 17,505 16,783 19,686
Gas (Mcf) 338,882 370,975 513,815
Oil and gas sales(1):
Oil $ 295,745 $ 210,592 $ 387,375
Gas 746,206 797,041 1,267,510
--------- --------- ---------
Total $1,041,951 $1,007,633 $1,654,885
========= ========= =========
Average sales price:
Per barrel of oil $16.89 $12.55 $19.68
Per Mcf of gas 2.20 2.15 2.47
- ----------
(1) These amounts differ from the Net Profits included in the P-4
Partnership's financial statements because they do not reflect the offset
of $295,097, $273,107, and $364,105, respectively, of production expenses
incurred by the Affiliated Programs.
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Net Production Data
P-5 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 6,858 6,315 7,972
Gas (Mcf) 464,917 552,109 516,756
Oil and gas sales(1):
Oil $ 117,808 $ 88,408 $ 158,471
Gas 922,397 1,030,105 1,148,588
--------- --------- ---------
Total $1,040,205 $1,118,513 $1,307,059
========= ========= =========
Average sales price:
Per barrel of oil $17.18 $14.00 $19.88
Per Mcf of gas 1.98 1.87 2.22
- ----------
(1) These amounts differ from the Net Profits included in the P-5
Partnership's financial statements because they do not reflect the offset
of $183,763, $291,437, and $306,934, respectively, of production expenses
incurred by the Affiliated Programs.
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Net Production Data
P-6 Partnership
---------------
Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ---------- ----------
Production:
Oil (Bbls) 17,227 19,139 18,461
Gas (Mcf) 909,561 948,078 984,971
Oil and gas sales(1):
Oil $ 280,628 $ 280,141 $ 354,536
Gas 1,765,886 1,737,876 2,231,611
--------- --------- ---------
Total $2,046,514 $2,018,017 $2,586,147
========= ========= =========
Average sales price:
Per barrel of oil $16.29 $14.64 $19.20
Per Mcf of gas 1.94 1.83 2.27
- ----------
(1) These amounts differ from the Net Profits included in the P-6
Partnership's financial statements because they do not reflect the offset
of $705,730, $777,917, and $792,462, respectively, of production expenses
incurred by the Affiliated Programs.
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Proved Reserves and Net Present Value
The following table sets forth each Partnership's estimated proved oil and
gas reserves and net present value therefrom as of December 31, 1999 which were
attributable to the Partnerships' Net Profits Interests. The schedule of
quantities of proved oil and gas reserves was prepared by the General Partner in
accordance with the rules prescribed by the Securities and Exchange Commission
(the "SEC"). Certain reserve information was reviewed by Ryder Scott Company,
L.P. ("Ryder Scott"), an independent petroleum engineering firm. As used
throughout this Annual Report, "proved reserves" refers to those estimated
quantities of crude oil, gas, and gas liquids which geological and engineering
data demonstrate with reasonable certainty to be recoverable in future years
from known oil and gas reservoirs under existing economic and operating
conditions.
Net present value represents estimated future gross cash flow from the
production and sale of proved reserves, net of estimated oil and gas production
costs (including production taxes, ad valorem taxes, and operating expenses) and
estimated future development costs, discounted at 10% per annum. Net present
value attributable to the Partnerships' proved reserves was calculated on the
basis of current costs and prices at December 31, 1999. Such prices were not
escalated except in certain circumstances where escalations were fixed and
readily determinable in accordance with applicable contract provisions. The
relatively high oil prices at December 31, 1999 have caused the estimates of
remaining economically recoverable oil reserves as well as the value placed on
said reserves to be higher than in the past several years, particularly
considering the impact of depletion from production over the years. Any decrease
in these high oil prices would result in a corresponding reduction in the
estimate of remaining oil reserves. The prices used in calculating the net
present value attributable to the Partnerships' proved reserves do not
necessarily reflect market prices for oil and gas production subsequent to
December 31, 1999. There can be no assurance that the prices used in calculating
the net present value of the Partnerships' proved reserves at December 31, 1999
will actually be realized for such production.
The process of estimating oil and gas reserves is complex, requiring
significant subjective decisions in the evaluation of available geological,
engineering, and economic data for each reservoir. The data for a given
reservoir may change substantially over time as a result of, among other things,
additional development activity, production history, and viability of production
under varying economic conditions; consequently, it is reasonably possible that
material revisions to existing reserve estimates may occur in the near future.
Although every reasonable effort has been made to ensure that these reserve
estimates represent the most accurate assessment
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possible, the significance of the subjective decisions required and variances in
available data for various reservoirs make these estimates generally less
precise than other estimates presented in connection with financial statement
disclosures.
Proved Reserves and
Net Present Values
From Proved Reserves
As of December 31, 1999(1)
P-1 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 1,856,427
Oil and liquids (Bbls) 199,519
Net present value (discounted at 10% per annum) $3,735,374
P-2 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 1,668,174
Oil and liquids (Bbls) 146,807
Net present value (discounted at 10% per annum) $2,980,207
P-3 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 3,134,280
Oil and liquids (Bbls) 271,998
Net present value (discounted at 10% per annum) $5,554,525
P-4 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 2,108,230
Oil and liquids (Bbls) 60,023
Net present value (discounted at 10% per annum) $3,086,172
P-5 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 2,335,679
Oil and liquids (Bbls) 39,773
Net present value (discounted at 10% per annum) $2,787,088
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P-6 Partnership:
- ---------------
Estimated proved reserves:
Gas (Mcf) 3,879,762
Oil and liquids (Bbls) 102,745
Net present value (discounted at 10% per annum) $4,976,533
- ---------
(1) Includes certain gas balancing adjustments which cause the gas volumes and
net present values to differ from the reserve reports which were prepared
by the General Partner and reviewed by Ryder Scott.
No estimates of the proved reserves of the Partnerships comparable to
those included herein have been included in reports to any federal agency other
than the SEC. Additional information relating to the Partnership's proved
reserves is contained in Note 4 to the Partnerships' financial statements,
included in Item 8 of this Annual Report.
Significant Properties
The following table sets forth certain well and reserve information for
the basins in which the Partnerships own a significant amount of Net Profits
Interests. The table contains the following information for each significant
basin: (i) the number of wells in which a Net Profits Interest is owned, (ii)
the number and percentage of wells operated by the Partnership's affiliates,
(iii) estimated proved oil reserves, (iv) estimated proved gas reserves, and (v)
the present value (discounted at 10% per annum) of estimated future net cash
flow.
The Anadarko Basin is located in western Oklahoma and the Texas panhandle,
while the Gulf Coast Basin is located in southern Louisiana and southeast Texas.
The Southern Oklahoma Folded Belt Basin is located in southern Oklahoma, while
the Permian Basin is located in west Texas and southeast New Mexico.
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<PAGE>
Significant Properties as of December 31, 1999
----------------------------------------------
Wells
Operated by
Affiliates Oil Gas
Total ----------- Reserves Reserves Present
Basin Wells Number % (Bbl) (Mcf) Value
- ----------- ----- ------ --- -------- -------- -------
P-1 P/ship:
Permian 829 3 - 183,099 860,563 $2,594,217
Anadarko 60 17 23% 3,566 923,863 980,536
P-2 P/ship:
Permian 829 3 - 125,161 593,981 $1,780,377
Anadarko 60 17 23% 3,386 736,890 782,006
P-3 P/ship:
Permian 829 3 - 230,741 1,095,777 $3,282,724
Anadarko 60 17 23% 6,352 1,370,397 1,454,175
South. Ok.
Folded Belt 24 21 81% 16,225 496,680 528,791
P-4 P/ship:
Gulf Coast 42 11 14% 46,251 999,430 $1,841,827
Anadarko 52 9 15% 5,136 739,281 803,639
P-5 P/ship:
Anadarko 31 29 33% 6,693 1,571,507 $1,802,409
South. Ok.
Folded Belt 13 - - 22,065 413,884 587,797
Permian 29 27 42% 10,694 318,012 314,662
P-6 P/ship:
Anadarko 31 29 33% 4,014 1,366,765 $1,538,246
South. Ok.
Folded Belt 26 13 15% 74,326 331,167 1,207,307
East Texas 3 2 67% 3,119 926,481 959,476
Gulf Coast 12 1 8% 3,819 527,067 626,546
Title to Oil and Gas Properties
Management believes that the Partnerships have satisfactory title to their
Net Profits Interests. Record title to all of the properties subject to the
Partnerships' Net Profits Interests is held by either the Partnerships or
Geodyne Nominee Corporation, an affiliate of the General Partner.
Title to the Partnerships' Net Profits Interests is subject to customary
royalty, overriding royalty, carried, working, and other similar interests and
contractual arrangements customary in the oil and gas industry, to liens for
current taxes not yet due,
-21-
<PAGE>
and to other encumbrances. Management believes that such burdens do not
materially detract from the value of such properties or from the Partnerships'
Net Profits Interests therein or materially interfere with their use in the
operation of the Partnerships' business.
ITEM 3. LEGAL PROCEEDINGS
To the knowledge of the General Partner, neither the General Partner nor
the Partnerships or their properties are subject to any litigation, the results
of which would have a material effect on the Partnerships' or the General
Partner's financial condition or operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF LIMITED PARTNERS
There were no matters submitted to a vote of the Limited Partners of any
Partnership during 1999.
PART II.
ITEM 5. MARKET FOR UNITS AND RELATED LIMITED PARTNER MATTERS
As of February 1, 2000, the number of Units outstanding and the
approximate number of Limited Partners of record in the Partnerships were as
follows:
Number of Limited
Partnership Units Partners
----------- --------- --------
P-1 108,074 818
P-2 90,094 605
P-3 169,637 1,383
P-4 126,306 933
P-5 118,449 1,020
P-6 143,041 769
Units were initially sold for a price of $100. The Units are not traded on
any exchange and there is no public trading market for them. The General Partner
is aware of certain transfers of Units between unrelated parties, some of which
are facilitated by secondary trading firms and matching services. In addition,
as further described below, the General Partner is aware of certain "4.9% tender
offers" which have been made for the Units. The General Partner believes that
the transfers between unrelated parties have been limited and sporadic in number
and volume. Other than trades facilitated by certain secondary trading firms and
matching services, no organized trading market for Units
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<PAGE>
exists and none is expected to develop. Due to the nature of these transactions,
the General Partner has no verifiable information regarding prices at which
Units have been transferred. Further, a transferee may not become a substitute
Limited Partner without the consent of the General Partner.
Pursuant to the terms of the Partnership Agreements, the General Partner
is obligated to annually issue a repurchase offer based on the estimated future
net revenues from the Partnerships' reserves and is calculated pursuant to the
terms of the Partnership Agreements. Such repurchase offer is recalculated
monthly in order to reflect cash distributions to the Limited Partners and
extraordinary events. The following table sets forth the General Partner's
repurchase offer per Unit as of the periods indicated. For purposes of this
Annual Report, a Unit represents an initial subscription of $100 to a
Partnership.
Repurchase Offer Prices
-----------------------
1998 1999 2000
------------------------- ------------------------ ----
1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st
P/ship Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr.
- ------ ---- ---- ---- ---- ---- ---- ---- ---- ----
P-1 $16 $25 $19 $18 $17 $16 $20 $19 $17
P-2 16 24 20 19 18 17 20 19 17
P-3 16 24 20 19 18 17 20 19 17
P-4 9 17 16 15 14 14 14 13 12
P-5 11 16 14 12 11 10 13 11 10
P-6 14 24 22 20 18 17 20 18 15
In addition to this repurchase offer, some of the Partnerships have been
subject to "4.9% tender offers" from several third parties since 1997. The
General Partner does not know the terms of these offers or the prices received
by the Limited Partners who accepted these offers.
-23-
<PAGE>
Cash Distributions
Cash distributions are primarily dependent upon a Partnership's cash
receipts from its Net Profits Interests and cash requirements of the
Partnership. Distributable cash is determined by the General Partner at the end
of each calendar quarter and distributed to the Limited Partners within 45 days
after the end of the quarter. Distributions are restricted to cash on hand less
amounts required to be retained out of such cash as determined in the sole
judgment of the General Partner to pay costs, expenses, or other Partnership
obligations whether accrued or anticipated to accrue. In certain instances, the
General Partner may not distribute the full amount of cash receipts which might
otherwise be available for distribution in an effort to equalize or stabilize
the amounts of quarterly distributions. Any available amounts not distributed
are invested and the interest or income thereon is for the accounts of the
Limited Partners.
The following is a summary of cash distributions paid to the Limited
Partners during 1998 and 1998 and the first quarter of 2000:
Cash Distributions
------------------
1998
-------------------------------------------------
1st 2nd 3rd 4th
P/ship Quarter(1) Quarter(1) Quarter(1) Quarter(1)
------ --------- --------- --------- ---------
P-1 $4.52 $2.50 $5.44 $1.13
P-2 3.95 2.30 4.51 1.02
P-3 3.90 2.28 4.41 1.01
P-4 1.75 2.12 1.20 1.12
P-5 1.74 2.83 2.94 1.53
P-6 2.49 2.94 2.13 1.73
1999 2000
---------------------------------------------- -------
1st 2nd 3rd 4th 1st
P/ship Quarter Quarter Quarter Quarter Quarter
------ ------- ------- ------- ------- -------
P-1 $0.92 $0.97 $1.05 $1.38 $1.67
P-2 0.87 0.91 1.07 1.39 1.51
P-3 0.85 0.90 1.06 1.36 1.51
P-4 0.69 0.74 0.87 1.24 1.09
P-5 1.23 0.97 1.06 1.40 1.53
P-6 2.08 1.35 1.52 2.15 2.34
- -----------------------
(1) Amount of cash distribution includes proceeds from the sale of certain Net
Profits Interests.
-24-
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
The following tables present selected financial data for the Partnerships.
This data should be read in conjunction with the financial statements of the
Partnerships, and the respective notes thereto, included elsewhere in this
Annual Report. See "Item 8. Financial Statements and Supplementary Data."
-25-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-1 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $ 802,539 $ 694,919 $1,064,105 $1,191,311 $ 935,026
Net Income:
Limited Partners 443,201 760,585 106,676 773,173 6,098
General Partner 65,862 60,539 54,016 53,849 33,359
Total 509,063 821,124 160,692 827,022 39,457
Limited Partners' Net
Income per Unit 4.10 7.04 .99 7.15 .06
Limited Partners' Cash
Distributions per Unit 4.32 13.59 11.43 9.41 6.99
Total Assets 1,354,470 1,372,787 2,076,686 3,230,759 3,488,930
Partners' Capital (Deficit)
Limited Partners 1,431,887 1,455,686 2,164,101 3,293,425 3,537,252
General Partner ( 77,417) ( 82,899) ( 87,415) ( 62,666) ( 48,322)
Number of Units
Outstanding 108,074 108,074 108,074 108,074 108,074
</TABLE>
-26-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-2 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $ 618,890 $ 538,185 $ 836,494 $ 911,429 $ 715,608
Net Income (Loss):
Limited Partners 333,537 545,193 45,213 551,248 ( 182,851)
General Partner 31,057 36,137 41,244 40,232 23,562
Total 364,594 581,330 86,457 591,480 ( 159,289)
Limited Partners' Net
Income (Loss) per Unit 3.70 6.05 .50 6.12 ( 2.03)
Limited Partners' Cash
Distributions per Unit 4.24 11.78 10.86 8.42 6.04
Total Assets 1,139,335 1,172,679 1,686,752 2,635,549 2,854,539
Partners' Capital (Deficit)
Limited Partners 1,195,920 1,243,383 1,759,190 2,692,977 2,900,729
General Partner ( 56,585) ( 70,704) ( 72,438) ( 57,428) ( 46,190)
Number of Units
Outstanding 90,094 90,094 90,094 90,094 90,094
</TABLE>
-27-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-3 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $1,155,814 $ 997,464 $1,559,975 $1,706,259 $1,327,052
Net Income (Loss):
Limited Partners 635,523 1,009,546 30,632 1,024,694 ( 413,819)
General Partner 45,011 66,787 76,414 75,192 42,468
Total 680,534 1,076,333 107,046 1,099,886 ( 371,351)
Limited Partners' Net
Income (Loss) per
Unit 3.75 5.95 .18 6.04 ( 2.44)
Limited Partners' Cash
Distributions per
Unit 4.17 11.60 10.81 8.21 6.21
Total Assets 2,131,160 2,183,351 3,136,542 4,968,083 5,355,843
Partners' Capital
(Deficit)
Limited Partners 2,244,869 2,316,346 3,273,800 5,075,168 5,442,474
General Partner ( 113,709) ( 132,995) ( 137,258) (107,085) ( 86,631)
Number of Units
Outstanding 169,637 169,637 169,637 169,637 169,637
</TABLE>
-28-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-4 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $ 746,854 $ 734,526 $1,290,780 $1,373,635 $1,251,153
Net Income (Loss):
Limited Partners 367,583 357,206 52,241 584,825 ( 496,777)
General Partner 36,289 27,697 49,097 52,931 40,039
Total 403,872 384,903 101,338 637,756 ( 456,738)
Limited Partners' Net
Income (Loss) per Unit 2.91 2.83 .41 4.63 3.93)
Limited Partners' Cash
Distributions per Unit 3.54 6.19 11.84 9.62 8.36
Total Assets 1,337,559 1,403,444 1,827,292 3,283,477 3,940,479
Partners' Capital (Deficit)
Limited Partners 1,417,880 1,497,297 1,922,091 3,364,850 3,995,025
General Partner ( 80,321) ( 93,853) ( 94,799) ( 81,373) ( 54,546)
Number of Units
Outstanding 126,306 126,306 126,306 126,306 126,306
</TABLE>
-29-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-5 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $ 856,442 $ 827,076 $1,000,125 $1,112,631 $ 938,957
Net Income (Loss):
Limited Partners 519,222 710,547 ( 355,086) 593,334 ( 201,341)
General Partner 34,149 48,790 34,199 46,364 30,697
Total 553,371 759,337 ( 320,887) 639,698 ( 170,644)
Limited Partners' Net
Income (Loss) per Unit 4.38 6.00 ( 3.00) 5.01 ( 1.70)
Limited Partners' Cash
Distributions per Unit 4.66 9.04 8.45 6.87 5.79
Total Assets 1,235,321 1,257,489 1,621,507 2,993,188 3,225,517
Partners' Capital (Deficit)
Limited Partners 1,303,959 1,336,737 1,696,190 3,053,276 3,273,942
General Partner ( 68,638) ( 79,248) ( 74,683) (60,088) ( 48,425)
Number of Units
Outstanding 118,449 118,449 118,449 118,449 118,449
</TABLE>
-30-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
P-6 Partnership
---------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Profits $1,340,784 $1,240,100 $1,793,685 $2,002,957 $1,284,185
Net Income (Loss):
Limited Partners 796,190 739,792 97,934 996,385 ( 907,347)
General Partner 55,301 56,121 67,889 84,925 36,393
Total 851,491 795,913 165,823 1,081,310 ( 870,954)
Limited Partners' Net
Income (Loss) per Unit 5.57 5.17 .68 6.97 ( 6.34)
Limited Partners' Cash
Distributions per Unit 7.10 9.29 11.62 10.07 5.73
Total Assets 2,314,214 2,511,782 3,112,118 4,714,677 5,170,032
Partners' Capital (Deficit)
Limited Partners 2,400,614 2,618,424 3,208,632 4,773,698 5,217,313
General Partner ( 86,400) ( 106,642) ( 96,514) ( 59,021) ( 47,281)
Number of Units
Outstanding 143,041 143,041 143,041 143,041 143,041
</TABLE>
-31-
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Use of Forward-Looking Statements and Estimates
This Annual Report contains certain forward-looking statements. The words
"anticipate," "believe," "expect," "plan," "intend," "estimate," "project,"
"could," "may," and similar expressions are intended to identify forward-looking
statements. Such statements reflect management's current views with respect to
future events and financial performance. This Annual Report also includes
certain information which is, or is based upon, estimates and assumptions. Such
estimates and assumptions are management's efforts to accurately reflect the
condition and operation of the Partnerships.
Use of forward-looking statements and estimates and assumptions involve
risks and uncertainties which include, but are not limited to, the volatility of
oil and gas prices, the uncertainty of reserve information, the operating risk
associated with oil and gas properties (including the risk of personal injury,
death, property damage, damage to the well or producing reservoir, environmental
contamination, and other operating risks), the prospect of changing tax and
regulatory laws, the availability and capacity of processing and transportation
facilities, the general economic climate, the supply and price of foreign
imports of oil and gas, the level of consumer product demand, and the price and
availability of alternative fuels. Should one or more of these risks or
uncertainties occur or should estimates or underlying assumptions prove
incorrect, actual conditions or results may vary materially and adversely from
those stated, anticipated, believed, estimated, or otherwise indicated.
General Discussion
The following general discussion should be read in conjunction with the
analysis of results of operations provided below. The most important variable
affecting the Partnerships' revenues is the prices received for the sale of oil
and gas. Predicting future prices is not possible. Concerning past trends,
average yearly wellhead gas prices in the United States have been volatile for
many years. Over the past ten years such average prices have generally been in
the $1.40 to $2.40 per Mcf range. Gas prices are currently in the upper end of
this range.
Substantially all of the Partnerships' gas reserves are being sold on the
"spot market." Prices on the spot market are subject to wide seasonal and
regional pricing fluctuations due to the highly competitive nature of the spot
market. In addition, such spot market sales are generally short-term in nature
and are dependent upon the obtaining of transportation services provided
-32-
<PAGE>
by pipelines. Spot prices for the Partnerships' gas increased from approximately
$2.03 per Mcf at December 31, 1998 to approximately $2.24 per Mcf at December
31, 1999. Such prices were on an MMBTU basis and differ from the prices actually
received by the Partnerships due to transportation and marketing costs, BTU
adjustments, and regional price and quality differences.
For the past ten years, average oil prices have generally been in the
$16.00 to $24.00 per barrel range, but have been extremely volatile over the
past two years. Due to global consumption and supply trends as well as a
slowdown in Asian energy demand, oil prices in late 1997 and early 1998 reached
historically low levels, dropping to as low as approximately $9.25 per barrel.
However, production curtailment agreements among major oil producing nations
have caused recent oil prices to climb to over $24.00 per barrel in some
markets. It is not known whether this trend will continue. Prices for the
Partnerships' oil increased from approximately $9.50 per barrel at December 31,
1998 to approximately $22.75 per barrel at December 31, 1999.
Future prices for both oil and gas will likely be different from the
prices in effect on December 31, 1999. Management is unable to predict whether
future oil and gas prices will (i) stabilize, (ii) increase, or (iii) decrease.
As discussed in the "Results of Operations" section below, volumes of oil
and gas sold also significantly affect the Partnerships' revenues. Oil and gas
wells generally produce the most oil or gas in the earlier years of their lives
and, as production continues, the rate of production naturally declines. At some
point, production physically ceases or becomes no longer economic. The
Partnerships are not acquiring additional Net Profits Interests, and the
existing Net Profits Interests are not experiencing significant additional
production through drilling or other capital projects. Therefore, volumes of oil
and gas produced from the properties underlying the Partnerships' Net Profits
Interests naturally decline from year to year. While it is difficult for
management to predict future production from these properties, it is likely that
this general trend of declining production will continue.
Despite this general trend of declining production, several factors can
cause the volumes of oil and gas sold to increase or decrease at an even greater
rate over a given period. These factors include, but are not limited to, (i)
geophysical conditions which cause an acceleration of the decline in production,
(ii) the shutting in of wells (or the opening of previously shut-in wells) due
to low oil and gas prices, mechanical difficulties, loss of a market or
transportation, or performance of workovers, recompletions, or other operations
in the well, (iii) prior period volume adjustments (either positive or negative)
made by purchasers of the production, (iv) ownership
-33-
<PAGE>
adjustments in accordance with agreements governing the operation or ownership
of the well (such as adjustments that occur at payout), and (v) completion of
enhanced recovery projects which increase production for the well. Many of these
factors are very significant as related to a single well or as related to many
wells over a short period of time. However, due to the large number of Net
Profits Interests owned by the Partnerships, these factors are generally not
material as compared to the normal decline in production experienced on all
remaining wells in which a Net Profits Interest is owned.
Results of Operations
An analysis of the change in net oil and gas operations (oil and gas
sales, less lease operating expenses and production taxes), is presented in the
tables following "Results of Operations" under the heading "Average Proceeds and
Units of Production." Following is a discussion of each Partnerships results of
operations for the year ended December 31, 1999 as compared to the year ended
December 31, 1998 and for the year ended December 31, 1998 as compared to the
year ended December 31, 1997.
P-1 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $107,620 (15.5%) in 1999 as compared to 1998.
Of this increase, approximately $81,000 and $14,000, respectively, were related
to increases in the average prices of oil and gas sold and approximately $66,000
was related to an increase in volumes of gas sold. These increases were
partially offset by decreases of (i) approximately $26,000 related to a decrease
in volumes of oil sold and (ii) approximately $28,000 related to an increase in
production expenses incurred by the owners of the Working Interests. Volumes of
oil sold decreased 1,939 barrels while volumes of gas sold increased 36,013 Mcf
in 1999 as compared to 1998. The increase in volumes of gas sold was primarily
due to (i) a positive prior period volume adjustment made by the operator during
1999 due to the payout of one significant well and (ii) the successful
recompletion of a well during the fourth quarter of 1998. The increase in
production expenses was primarily due to (i) workover expenses incurred on two
significant wells during 1999 in order to improve the recovery of reserves and
(ii) a positive prior period lease operating expense adjustment on one
significant well made during 1999. Average oil and gas prices increased to
$16.69 per barrel and $1.86 per Mcf, respectively, in 1999 from $13.40 per
barrel and $1.82 per Mcf, respectively, in 1998.
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<PAGE>
The P-1 Partnership sold certain Net Profits Interests during 1999 and
recognized a gain of $698 on such sales. Sales of Net Profits Interests during
1998 resulted in the P-1 Partnership recognizing similar gains totaling
$476,752.
Depletion of Net Profits Interests decreased $63,745 (27.1%) in 1999 as
compared to 1998. This decrease was primarily due to several wells being fully
depleted in 1998 due to the lack of economically recoverable reserves. As a
percentage of Net Profits, this expense decreased to 21.3% in 1999 from 33.8% in
1998. This percentage decrease was primarily due to (i) the dollar decrease in
Depletion of Net Profits Interests and (ii) the increases in the average prices
of oil and gas sold.
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
15.9% in 1999 from 18.3% in 1998. This percentage decrease was primarily due to
the increase in Net Profits.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $11,949,558 or 110.57% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $369,186 (34.7%) in 1998 as compared to 1997.
Of this decrease, approximately $100,000 and $82,000, respectively, were related
to decreases in volumes of oil and gas sold and approximately $141,000 and
$145,000, respectively, were related to decreases in the average prices of oil
and gas sold. The decrease in Net Profits related to decreased oil and gas sales
was partially offset by an approximate $99,000 decrease in production expenses
incurred by the owners of the Working Interests. Volumes of oil and gas sold
decreased 5,368 barrels and 36,090 Mcf, respectively, in 1998 as compared to
1997. The decreases in volumes of oil and gas sold resulted primarily from the
sale of several wells during 1997 and 1998. The decrease in production expenses
resulted primarily from (i) a decrease in lease operating expenses associated
with the decreases in volumes of oil and gas sold and (ii) a decrease in
production taxes associated with the decrease in oil and gas sales. Average oil
and gas prices decreased to $13.40 per barrel and $1.82 per Mcf, respectively,
in 1998 from $18.69 per barrel and $2.27 per Mcf, respectively, in 1997.
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<PAGE>
As discussed in "Liquidity and Capital Resources" below, the P-1
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $476,752 on such sales. Sales of Net Profits Interests during 1997 resulted
in the P-1 Partnership recognizing similar gains totaling $380,408.
Depletion of Net Profits Interests decreased $28,620 (10.9%) in 1998 as
compared to 1997. This decrease resulted primarily from the decreases in volumes
of oil and gas sold. As a percentage of Net Profits, this expense increased to
33.8% in 1998 from 24.8% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
The P-1 Partnership recognized a non-cash charge against earnings of
$902,042 in the first quarter of 1997. Of this amount, $113,945 was related to
the decline in oil and gas prices used to determine future cash flows from the
P-1 Partnership's Net Profits Interests in proved oil and gas reserves at March
31, 1997 and $788,097 was related to the writing-off of Net Profits Interests in
unproved properties. The unproved properties were written off based on the
General Partner's determination that it was unlikely that the unproved
properties would be developed due to low oil and gas prices and Partnership
Agreement provisions which limit the P-1 Partnership's level of permissible
indirect drilling activity through its Affiliated Programs. No similar charges
were necessary during 1998.
General and administrative expenses decreased $1,998 (1.5%) in 1998 as
compared to 1997. As a percentage of Net Profits, these expenses increased to
18.3% in 1998 from 12.1% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
The P-1 Partnership achieved payout during the third quarter of 1998.
After payout, operations and revenues for the P-1 Partnership have been and will
be allocated using the after payout percentages included in the P-1
Partnership's Partnership Agreement. Unless and until the Limited Partners
receive cash distributions resulting in the recognition of a 12% annualized
return on Limited Partners' subscriptions, after payout percentages will
allocate operating income and expenses 10% to the General Partner and 90% to the
Limited Partners. Before payout, operating income and expenses were allocated 5%
to the General Partner and 95% to the Limited Partners.
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<PAGE>
P-2 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $80,705 (15.0%) in 1999 as compared to 1998.
Of this increase, approximately $58,000 and $21,000, respectively, were related
to increases in the average prices of oil and gas sold and approximately $43,000
was related to an increase in volumes of gas sold. These increases were
partially offset by decreases of (i) approximately $14,000 related to a decrease
in volumes of oil sold and (ii) approximately $27,000 related to an increase in
production expenses incurred by the owners of the Working Interests. Volumes of
oil sold decreased 1,069 barrels while volumes of gas sold increased 23,211 Mcf
in 1999 as compared to 1998. The increase in production expenses was primarily
due to (i) workover expenses incurred on two significant wells during 1999 in
order to improve the recovery of reserves and (ii) a positive prior period lease
operating expense adjustment made on one significant well during 1999. Average
oil and gas prices increased to $16.67 per barrel and $1.92 per Mcf,
respectively, in 1999 from $13.38 per barrel and $1.85 per Mcf, respectively, in
1998.
The P-2 Partnership sold certain Net Profits Interests during 1999 and
recognized a gain of $472 on such sales. Sales of Net Profits Interests during
1998 resulted in the P-2 Partnership recognizing similar gains totaling
$328,122.
Depletion of Net Profits Interests decreased $35,288 (18.8%) in 1999 as
compared to 1998. This decrease was primarily due to several wells being fully
depleted in 1998 due to the lack of economically recoverable reserves. As a
percentage of Net Profits, this expense decreased to 24.6% in 1999 from 34.8% in
1998. This percentage decrease was primarily due to (i) the dollar decrease in
Depletion of Net Profits Interests and (ii) the increase in Net Profits.
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
17.2% in 1999 from 19.7% in 1998. This percentage decrease was primarily due to
the increase in Net Profits.
The P-2 Partnership achieved payout during the fourth quarter of 1999.
After payout, operations and revenues for the P-2 Partnership have been and will
be allocated using the after payout percentages included in the P-2
Partnership's Partnership Agreement. Unless and until the Limited Partners
receive cash distributions resulting in the recognition of a 12% annualized
return on Limited Partners' subscriptions, after payout
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<PAGE>
percentages will allocate operating income and expenses 10% to the General
Partner and 90% to the Limited Partners. Before payout, operating income and
expenses were allocated 5% to the General Partner and 95% to the Limited
Partners.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $9,104,561 or 101.06% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $298,309 (35.7%) in 1998 as compared to 1997.
Of this decrease, approximately $79,000 and $81,000, respectively, were related
to decreases in volumes of oil and gas sold and approximately $99,000 and
$125,000, respectively, were related to decreases in the average prices of oil
and gas sold. The decrease in Net Profits related to decreased oil and gas sales
was partially offset by an approximate $86,000 decrease in production expenses
incurred by the owners of the Working Interests. Volumes of oil and gas sold
decreased 4,221 barrels and 34,900 Mcf, respectively, in 1998 as compared to
1997. The decreases in volumes of oil and gas sold resulted primarily from the
sale of several wells during 1997 and 1998. The decrease in production expenses
resulted primarily from (i) a decrease in lease operating expenses associated
with the decreases in volumes of oil and gas sold and (ii) a decrease in
production taxes associated with the decrease in oil and gas sales. Average oil
and gas prices decreased to $13.38 per barrel and $1.85 per Mcf, respectively,
in 1998 from $18.71 per barrel and $2.32 per Mcf, respectively, in 1997.
As discussed in "Liquidity and Capital Resources" below, the P-2
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $328,122 on such sales. Sales of Net Profits Interests during 1997 resulted
in the P-2 Partnership recognizing similar gains totaling $284,247.
Depletion of Net Profits Interests decreased $19,889 (9.6%) in 1998 as
compared to 1997. As a percentage of Net Profits, this expense increased to
34.8% in 1998 from 24.8% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
The P-2 Partnership recognized a non-cash charge against earnings of
$727,893 in 1997. Of this amount, $113,005 was related to the decline in oil and
gas prices used to determine future cash flows from the P-2 Partnership's Net
Profits Interests in proved oil and gas reserves at March 31, 1997 and $614,888
was related to the writing-off of Net Profits Interests in unproved properties.
These unproved properties were written off based on the General Partner's
determination that it was
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<PAGE>
unlikely that the unproved properties would be developed due to low oil and gas
prices and Partnership Agreement provisions which limit the P-2 Partnership's
level of permissible indirect drilling activity through its Affiliated Programs.
No similar charges were necessary during 1998.
General and administrative expenses decreased $1,480 (1.4%) in 1998 as
compared to 1997. As a percentage of Net Profits, these expenses increased to
19.7% in 1998 from 12.9% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
P-3 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $158,350 (15.9%) in 1999 as compared to 1998.
Of this increase, approximately $107,000 and $38,000, respectively, were related
to increases in the average prices of oil and gas sold and approximately $86,000
was related to an increase in volumes of gas sold. These increases were
partially offset by decreases of (i) approximately $27,000 related to a decrease
in volumes of oil sold and (ii) approximately $46,000 related to an increase in
production expenses incurred by the owners of the Working Interests. Volumes of
oil sold decreased 1,981 barrels while volumes of gas sold increased 46,663 Mcf
in 1999 as compared to 1998. The increase in production expenses was primarily
due to (i) workover expenses incurred on two significant wells during 1999 in
order to improve the recovery of reserves and (ii) a positive prior period lease
operating expense adjustment made on one significant well during 1999. Average
oil and gas prices increased to $16.66 per barrel and $1.92 per Mcf,
respectively, in 1999 from $13.39 per barrel and $1.85 per Mcf, respectively, in
1998.
The P-3 Partnership sold certain Net Profits Interests during 1999 and
recognized a gain of $968 on such sales. Sales of Net Profits Interests during
1998 resulted in the P-3 Partnership recognizing similar gains totaling
$606,887.
Depletion of Net Profits Interests decreased $60,859 (17.7%) in 1999 as
compared to 1998. This decrease was primarily due to several wells being fully
depleted in 1998 due to the lack of economically recoverable reserves. As a
percentage of Net Profits, this expense decreased to 24.6% in 1999 from 34.6% in
1998. This percentage decrease was primarily due to (i) the dollar decrease in
Depletion of Net Profits Interests and (ii) the increase in Net Profits.
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<PAGE>
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
17.3% in 1999 from 20.0% in 1998. This percentage decrease was primarily due to
the increase in Net Profits.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $16,466,401 or 97.07% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $562,511 (36.1%) in 1998 as compared to 1997.
Of this decrease, approximately $145,000 and $159,000, respectively, were
related to decreases in volumes of oil and gas sold and approximately $184,000
and $234,000, respectively, were related to decreases in the average prices of
oil and gas sold. The decrease in Net Profits related to decreased oil and gas
sales was partially offset by an approximate $159,000 decrease in production
expenses incurred by the owners of the Working Interests. Volumes of oil and gas
sold decreased 7,726 barrels and 68,403 Mcf, respectively, in 1998 as compared
to 1997. The decreases in volumes of oil and gas sold resulted primarily from
the sale of several wells during 1997 and 1998. The decrease in production
expenses resulted primarily from (i) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold and (ii) a decrease
in production taxes associated with the decrease in oil and gas sales. Average
oil and gas prices decreased to $13.39 per barrel and $1.85 per Mcf,
respectively, in 1998 from $18.72 per barrel and $2.32 per Mcf, respectively, in
1997.
As discussed in "Liquidity and Capital Resources" below, the P-3
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $606,887 on such sales. Sales of Net Profits Interests during 1997 resulted
in the P-3 Partnership recognizing similar gains totaling $532,904.
Depletion of Net Profits Interests decreased $41,240 (10.7%) in 1998 as
compared to 1997. This decrease resulted primarily from the decrease in volumes
of oil and gas sold. As a percentage of Net Profits, this expense increased to
34.6% in 1998 from 24.7% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
The P-3 Partnership recognized a non-cash charge against earnings of
$1,413,917 in the first quarter of 1997. Of this amount, $220,449 was related to
the decline in oil and gas prices used to determine future cash flows from the
P-3 Partnership's Net Profits Interests in proved oil and gas reserves at March
31,
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<PAGE>
1997 and $1,193,468 was related to the writing-off of Net Profits Interests in
unproved properties. The unproved properties were written off based on the
General Partner's determination that it was unlikely that the unproved
properties would be developed due to low oil and gas prices and Partnership
Agreement provisions which limit the P-3 Partnership's level of permissible
indirect drilling activity through its Affiliated Programs. No similar charges
were necessary during 1998.
General and administrative expenses decreased $2,629 (1.3%) in 1998 as
compared to 1997. As a percentage of Net Profits, these expenses increased to
20.0% in 1998 from 13.0% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
P-4 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $12,328 (1.7%) in 1999 as compared to 1998. Of
this increase, approximately $76,000 and $18,000, respectively, were related to
increases in the average prices of oil and gas sold and approximately $9,000 was
related to an increase in volumes of oil sold. These increases were partially
offset by decreases of (i) approximately $69,000 related to a decrease in
volumes of gas sold and (ii) approximately $22,000 related to an increase in
production expenses incurred by the owners of the Working Interests. Volumes of
oil sold increased 722 barrels while volumes of gas sold decreased 32,093 Mcf in
1999 as compared to 1998. The increase in production expenses was primarily due
to (i) workover expenses incurred on one significant well during 1999 in order
to improve the recovery of reserves and (ii) repair and maintenance expenses
incurred on another significant well during 1999. Average oil and gas prices
increased to $16.89 per barrel and $2.20 per Mcf, respectively, in 1999 from
$12.55 per barrel and $2.15 per Mcf, respectively, in 1998.
Depletion of Net Profits Interests decreased $21,578 (9.7%) in 1999 as
compared to 1998. As a percentage of Net Profits, this expense decreased to
26.8% in 1999 from 30.2% in 1998. This percentage decrease was primarily due to
the increase in Net Profits.
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
19.9% in 1999 from 20.2% in 1998.
The P-4 Partnership achieved payout during the fourth quarter of 1999.
After payout, operations and revenues for the
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<PAGE>
P-4 Partnership have been and will be allocated using the after payout
percentages included in the P-4 Partnership's Partnership Agreement. Unless and
until the Limited Partners receive cash distributions resulting in the
recognition of a 12% annualized return on Limited Partners' subscriptions, after
payout percentages will allocate operating income and expenses 10% to the
General Partner and 90% to the Limited Partners. Before payout, operating income
and expenses were allocated 5% to the General Partner and 95% to the Limited
Partners.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $12,634,945 or 100.03% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $556,254 (43.1%) in 1998 as compared to 1997.
Of this decrease, approximately $120,000 and $118,000, respectively, were
related to decreases in the average prices of oil and gas sold and approximately
$57,000 and $352,000, respectively, were related to decreases in volumes of oil
and gas sold. The decrease in Net Profits related to decreased oil and gas sales
was partially offset by an approximate $91,000 decrease in production expenses
incurred by the owners of the Working Interests. Volumes of oil and gas sold
decreased 2,903 barrels and 142,840 Mcf, respectively, in 1998 as compared to
1997. The decrease in volumes of oil sold resulted primarily from normal
declines in production. The decrease in volumes of gas sold resulted primarily
from (i) normal declines in production and (ii) the sale of several wells in
1997 and 1998. The decrease in production expenses resulted primarily from (i) a
decrease in lease operating expenses associated with the decreases in volumes of
oil and gas sold and (ii) a decrease in production taxes associated with the
decrease in oil and gas sales. Average oil and gas prices decreased to $12.55
per barrel and $2.15 per Mcf, respectively, in 1998 from $19.68 per barrel and
$2.47 per Mcf, respectively, in 1997.
As discussed in "Liquidity and Capital Resources" below, the P-4
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $12,332 on such sales. Sales of Net Profits Interests during 1997 resulted in
the P-4 Partnership recognizing similar gains totaling $63,002.
Depletion of Net Profits Interests decreased $143,151 (39.3%) in 1998 as
compared to 1997. This decrease resulted primarily from (i) the decreases in
volumes of oil and gas sold and (ii) upward revisions in the estimates of
remaining oil and gas reserves at December 31, 1998. As a percentage of Net
Profits, this expense increased to 30.2% in 1998 from 28.3% in 1997. This
percentage increase was primarily due to the decrease in Net Profits.
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<PAGE>
The P-4 Partnership recognized a non-cash charge against earnings of
$752,388 in the first quarter of 1997. Of this amount, $84,059 was related to
the decline in oil and gas prices used to determine future cash flows from the
P-4 Partnership's Net Profits Interests in proved oil and gas reserves at March
31, 1997 and $668,329 was related to the writing-off of Net Profits Interests in
unproved properties. These unproved properties were written off based on the
General Partner's determination that it was unlikely that the unproved
properties would be developed due to low oil and gas prices and Partnership
Agreement provisions which limit the P-4 Partnership's level of permissible
indirect drilling activity through its Affiliated Programs. No similar charges
were necessary during 1998.
General and administrative expenses remained relatively constant in 1998
as compared to 1997. As a percentage of Net Profits, these expenses increased to
20.2% in 1998 from 11.5% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
P-5 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $29,366 (3.6%) in 1999 as compared to 1998. Of
this increase, (i) approximately $108,000 was related to a decrease in
production expenses incurred by the owners of the Working Interests, (ii)
approximately $22,000 and $55,000, respectively, were related to increases in
the average prices of oil and gas sold, and (iii) approximately $8,000 was
related to an increase in volumes of oil sold. These increases were partially
offset by a decrease of approximately $163,000 related to a decrease in volumes
of gas sold. Volumes of oil sold increased 543 barrels while volumes of gas sold
decreased 87,192 Mcf in 1999 as compared to 1998. The decrease in volumes of gas
sold was primarily due to (i) normal declines in production, (ii) positive prior
period volume adjustments made by the purchasers on two significant wells during
1998, and (iii) a negative prior period volume adjustment made by the purchaser
on one significant well during 1999. The decrease in production expenses was
primarily due to a negative prior period lease operating expense adjustment made
by the operator on one significant well during 1999. Average oil and gas prices
increased to $17.18 per barrel and $1.98 per Mcf, respectively, in 1999 from
$14.00 per barrel and $1.87 per Mcf, respectively, in 1998.
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<PAGE>
The P-5 Partnership sold certain Net Profits Interests during 1998 and
recognized a gain of $344,575 on such sales. No such gains were recognized on
sales of Net Profits Interests during 1999.
Depletion of Net Profits Interests decreased $113,337 (40.0%) in 1999 as
compared to 1998. This decrease was primarily due to (i) one significant well
being fully depleted in 1998 due to the lack of remaining economically
recoverable reserves, (ii) the decrease in volumes of gas sold, and (iii) upward
revisions in the estimates of remaining oil and gas reserves at December 31,
1999. As a percentage of Net Profits, this expense decreased to 19.8% in 1999
from 34.2% in 1998. This percentage decrease was primarily due to the dollar
decrease in Depletion of Net Profits Interests.
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
16.3% in 1999 from 16.8% in 1998.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $7,977,759 or 67.35% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $173,049 (17.3%) in 1998 as compared to 1997.
Of this decrease, approximately $37,000 and $197,000, respectively, were related
to decreases in the average prices of oil and gas sold and approximately $33,000
was related to a decrease in volumes of oil sold. The decrease in Net Profits
was partially offset by an increase of approximately $79,000 related to an
increase in volumes of gas sold and a decrease of approximately $15,000 in
production expenses incurred by the owners of the Working Interests. Volumes of
oil sold decreased 1,657 barrels while volumes of gas sold increased 35,353 Mcf
in 1998 as compared to 1997. The decrease in volumes of oil sold resulted
primarily from (i) the normal decline in production and (ii) the sale of several
wells during 1997 and 1998. Average oil and gas prices decreased to $14.00 per
barrel and $1.87 per Mcf, respectively, in 1998 from $19.88 per barrel and $2.22
per Mcf, respectively, in 1997.
As discussed in "Liquidity and Capital Resources" below, the P-5
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $344,575 on such sales. Sales of Net Profits Interests during 1997 resulted
in the P-5 Partnership recognizing similar gains totaling $79,182.
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<PAGE>
Depletion of Net Profits Interests increased $34,016 (13.7%) in 1998 as
compared to 1997. This increase resulted primarily from a downward revision in
the estimate of remaining oil and gas reserves at December 31, 1998 on one
significant well. As a percentage of Net Profits, this expense increased to
34.2% in 1998 from 24.9% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
The P-5 Partnership recognized a non-cash charge against earnings of
$1,018,068 in the first quarter of 1997. Of this amount, $122,458 was related to
the decline in oil and gas prices used to determine future cash flows from the
P-5 Partnership's Net Profits Interests in proved oil and gas reserves at March
31, 1997 and $895,610 was related to the writing-off of Net Profits Interests in
unproved properties. The unproved properties were written off based on the
General Partner's determination that it was unlikely that the unproved
properties would be developed due to low oil and gas prices and Partnership
Agreement provisions which limit the P-5 Partnership's level of permissible
indirect drilling activity through its Affiliated Programs. No similar charges
were necessary during 1998.
General and administrative expenses decreased $2,677 (1.9%) in 1998 as
compared to 1997. As a percentage of Net Profits, these expenses increased to
16.8% in 1998 from 14.2% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
P-6 Partnership
---------------
Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998
--------------------------------------
Total Net Profits increased $100,684 (8.1%) in 1999 as compared to 1998.
Of this increase, approximately $28,000 and $99,000, respectively, were related
to increases in the average prices of oil and gas sold and approximately $72,000
was related to a decrease in production expenses incurred by the owners of the
Working Interests. These increases were partially offset by decreases of
approximately $28,000 and $70,000, respectively, related to decreases in volumes
of oil and gas sold. Volumes of oil and gas sold decreased 1,912 barrels and
38,517 Mcf, respectively, during 1999 as compared to 1998. The decrease in
volumes of oil sold was primarily due to positive prior period volume
adjustments made by the operator on one significant well during 1998. The
decrease in production expenses was primarily due to a decrease in repair and
maintenance expenses on several wells during 1999 as compared to 1998. Average
oil and gas prices increased to $16.29 per barrel and $1.94 per Mcf,
respectively, in 1999 from $14.64 per barrel and $1.83 per Mcf, respectively, in
1998.
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<PAGE>
The P-6 Partnership sold certain Net Profits Interests during 1998 and
recognized a $135,752 gain on such sales. No such gains were recognized on sales
of Net Profits Interest during 1999.
Depletion of Net Profits Interests decreased $94,855 (22.3%) in 1999 as
compared to 1998. This decrease was primarily due to (i) the decreases in
volumes of oil and gas sold and (ii) upward revisions in the estimates of
remaining oil and gas reserves at December 31, 1999. As a percentage of Net
Profits, this expense decreased to 24.6% in 1999 from 34.3% in 1998. This
percentage decrease was primarily due to (i) the dollar decrease in Depletion of
Net Profits Interests and (ii) the increase in Net Profits.
General and administrative expenses remained relatively constant in 1999
as compared to 1998. As a percentage of Net Profits, these expenses decreased to
12.6% in 1999 from 13.6% in 1998.
Cumulative cash distributions to the Limited Partners through December 31,
1999 were $10,792,248 or 75.45% of the Limited Partners' capital contributions.
Year Ended December 31, 1998 Compared
to Year Ended December 31, 1997
--------------------------------------
Total Net Profits decreased $553,585 (30.9%) in 1998 as compared to 1997.
Of this decrease, approximately $87,000 and $410,000, respectively, were related
to decreases in the average prices of oil and gas sold and approximately $84,000
was related to a decrease in the volumes of gas sold. The decrease in Net
Profits was partially offset by an approximate $13,000 increase in the volumes
of oil sold and an approximate $14,000 decrease in production expenses incurred
by the owners of the Working Interests. Volumes of oil sold increased 678
barrels while volumes of gas sold decreased 36,893 Mcf during 1998 as compared
to 1997. Average oil and gas prices decreased to $14.64 per barrel and $1.83 per
Mcf, respectively, in 1998 from $19.20 per barrel and $2.27 per Mcf,
respectively, in 1997.
As discussed in "Liquidity and Capital Resources" below, the P-6
Partnership sold certain Net Profits Interests during 1998 and recognized a gain
of $135,752 on such sales. Sales of Net Profits Interests during 1997 resulted
in the P-6 Partnership recognizing similar gains totaling $37,698.
Depletion of Net Profits Interests decreased $185,621 (30.4%) in 1998 as
compared to 1997. This decrease resulted primarily from several significant
wells being fully depleted in 1997 due to the lack of remaining reserves. As a
percentage of
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<PAGE>
Net Profits, this expense remained relatively constant at 34.3% in 1998 and
34.0% in 1997. Any percentage increase primarily due to the decrease in Net
Profits was substantially offset by the dollar decrease in depletion of Net
Profits Interests.
The P-6 Partnership recognized a non-cash charge against earnings of
$898,584 in the first quarter of 1997. Of this amount, $444,990 was related to
the decline in oil and gas prices used to determine future cash flows from the
P-6 Partnership's Net Profits Interests in proved oil and gas reserves at March
31, 1997 and $453,594 was related to the writing-off of Net Profits Interests in
unproved properties. These unproved properties were written off based on the
General Partner's determination that it was unlikely that the unproved
properties would be developed due to low oil and gas prices and Partnership
Agreement provisions which limit the P-6 Partnership's level of permissible
indirect drilling activity through its Affiliated Programs. No similar charges
were necessary during 1998.
General and administrative expenses decreased $3,320 (1.9%) in 1998 as
compared to 1997. As a percentage of Net Profits, these expenses increased to
13.6% in 1998 from 9.6% in 1997. This percentage increase was primarily due to
the decrease in Net Profits.
Average Proceeds and Units of Production
The following tables are comparisons of the annual equivalent units of
production (one barrel of oil or six Mcf of gas) and the average proceeds
received per equivalent unit of production for the oil and gas sales
attributable to the Partnerships' Net Profits for the years ended December 31,
1999, 1998, and 1997.
1999 Compared to 1998
---------------------
Equivalent Units Average Proceeds
of Production per Equivalent Unit
----------------------------- --------------------------
P/ship 1999 1998 % Change 1999 1998 % Change
------ ------- ------- -------- ----- ----- --------
P-1 84,310 80,247 5% $ 9.52 $8.66 10%
P-2 65,824 63,024 4% 9.40 8.54 10%
P-3 123,104 117,308 5% 9.39 8.50 10%
P-4 73,985 78,612 ( 6%) 10.09 9.34 8%
P-5 84,344 98,333 (14%) 10.15 8.41 21%
P-6 168,821 177,152 ( 5%) 7.94 7.00 13%
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<PAGE>
1998 Compared to 1997
---------------------
Equivalent Units Average Proceeds
of Production per Equivalent Unit
----------------------------- --------------------------
P/ship 1998 1997 % Change 1998 1997 % Change
------ ------- ------- -------- ----- ----- --------
P-1 80,247 91,630 (12%) $8.66 $11.61 (25%)
P-2 63,024 73,062 (14%) 8.54 11.45 (25%)
P-3 117,308 136,434 (14%) 8.50 11.43 (26%)
P-4 78,612 105,322 (25%) 9.34 12.26 (24%)
P-5 98,333 94,098 5% 8.41 10.63 (21%)
P-6 177,152 182,623 ( 3%) 7.00 9.82 (29%)
Liquidity and Capital Resources
Net proceeds from operations less necessary operating capital are
distributed to the Limited Partners on a quarterly basis. See "Item 5. Market
for Units and Related Limited Partner Matters." The net proceeds from the Net
Profits Interests are not reinvested in productive assets. Assuming 1999
production levels for future years, the Partnerships' proved reserve quantities
at December 31, 1999 would have the following remaining lives:
Partnership Gas-Years Oil-Years
----------- --------- ---------
P-1 5.2 8.1
P-2 5.8 8.3
P-3 5.8 8.4
P-4 6.2 3.4
P-5 5.0 5.8
P-6 4.3 6.0
These life of reserves estimates are based on the current estimates of remaining
oil and gas reserves. See "Item 2. Properties" for a discussion of these reserve
estimates. In particular, the relatively high oil prices at December 31, 1999
have caused an increase in the estimates of remaining oil reserves which
therefore have increased the estimated life of said reserves.
The Partnerships' available capital from the Limited Partners'
subscriptions has been spent on Net Profits Interests and there should be no
further material capital resource commitments in the future. The Partnerships
have no debt commitments.
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<PAGE>
The Partnerships sold certain Net Profits Interests during 1999, 1998, and
1997. These sales were made by the General Partner after giving due
consideration to both the offer price and the General Partner's estimate of the
underlying property's remaining proved reserves and future operating costs. Net
proceeds from the sales were distributed to the Partnerships and included in the
calculation of the Partnerships' cash distributions for the quarter immediately
following the Partnerships' receipt of the proceeds. The amount of such proceeds
from the sale of Net Profits Interest during 1999, 1998, and 1997 were as
follows:
Partnership 1999 1998 1997
----------- --------- --------- ---------
P-1 $ 3,456 $519,832 $507,599
P-2 3,994 360,686 402,870
P-3 7,398 666,253 759,639
P-4 6,453 16,018 266,265
P-5 - 368,485 91,840
P-6 - 147,747 43,605
The General Partner believes that the sale of these Net Profits Interests
will be beneficial to the Partnerships since the properties sold generally had a
higher ratio of future operating expenses as compared to reserves than the
properties not sold.
There can be no assurance as to the amount of the Partnerships' future
cash distributions. The Partnerships' ability to make cash distributions depends
primarily upon the level of available cash flow generated by the Partnerships'
Net Profits Interests, which will be affected (either positively or negatively)
by many factors beyond the control of the Partnerships, including the price of
and demand for oil and gas and other market and economic conditions. Even if
prices and costs remain stable, the amount of cash available for distributions
will decline over time (as the volume of production from producing properties
declines) since the Partnerships are not replacing production. The Partnerships'
quantity of proved reserves has been reduced by the sale of Net Profits
Interests; therefore, it is possible that the Partnerships' future cash
distributions will decline as a result of a reduction of the Partnerships'
reserve base.
Inflation and Changing Prices
Prices obtained for oil and gas production depend upon numerous factors,
including the extent of domestic and foreign production, foreign imports of oil,
market demand, domestic and foreign economic conditions in general, and
governmental regulations and tax laws. The general level of inflation in the
economy did not have a material effect on the operations of the
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Partnerships in 1999. Oil and gas prices have fluctuated during recent years and
generally have not followed the same pattern as inflation. See "Item 2.
Properties - Oil and Gas Production, Revenue, and Price History."
Year 2000
The year 2000 issue refers to the inability of computer and other
information technology systems to properly process date and time information,
stemming from the earlier programming practice of using two digits rather than
four to represent the year in a date. To the knowledge of the General Partner,
the Partnerships have not experienced any material effects from the year 2000
issue. Costs incurred by the Partnerships in order to ensure year 2000
compatibility were not material to the Partnerships.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Partnerships do not hold any market risk sensitive instruments.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data are indexed in Item 14
hereof.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE GENERAL PARTNER
The Partnerships have no directors or executive officers. The following
individuals are directors and executive officers of the General Partner. The
business address of such director and executive officers is Two West Second
Street, Tulsa, Oklahoma 74103.
Name Age Position with General Partner
---------------- --- --------------------------------
Dennis R. Neill 47 President and Director
Judy K. Fox 48 Secretary
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The director will hold office until the next annual meeting of shareholders of
Geodyne or until his successor has been duly elected and qualified. All
executive officers serve at the discretion of the Board of Directors.
Dennis R. Neill joined Samson in 1981, was named Senior Vice President and
Director of Geodyne on March 3, 1993, and was named President of Geodyne and its
subsidiaries on June 30, 1996. Prior to joining Samson, he was associated with a
Tulsa law firm, Conner and Winters, where his principal practice was in the
securities area. He received a Bachelor of Arts degree in political science from
Oklahoma State University and a Juris Doctorate degree from the University of
Texas. Mr. Neill also serves as Senior Vice President of Samson Investment
Company and as President and Director of Samson Properties Incorporated, Samson
Hydrocarbons Company, Dyco Petroleum Corporation, Berry Gas Company, Circle L
Drilling Company, Snyder Exploration Company, and Compression, Inc.
Judy K. Fox joined Samson in 1990 and was named Secretary of Geodyne and
its subsidiaries on June 30, 1996. Prior to joining Samson, she served as Gas
Contract Manager for Ely Energy Company. Ms. Fox is also Secretary of Berry Gas
Company, Circle L Drilling Company, Compression, Inc., Dyco Petroleum
Corporation, Samson Hydrocarbons Company, Snyder Exploration Company, and Samson
Properties Incorporated.
Section 16(a) Beneficial Ownership Reporting Compliance
On October 27, 1999 the Masco Master Investment Account ("Masco") conveyed
10,600 (11.8%) of the Units of the P-2 partnership to Samson Resources Company.
As of the date of this Annual Report, the General Partner has received no Report
under Section 16 of the Securities and Exchange Act of 1934 (the "Act") from
Masco disclosing the sale of these Units. Samson Resources Company timely
reported their purchase of these Units to the SEC.
To the best knowledge of the Partnerships and the General Partner, there
were no other officers, directors, or ten percent owners who were delinquent
filers during 1999 of reports required under Section 16 of the Securities
Exchange Act of 1934.
-51-
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The General Partner and its affiliates are reimbursed for actual general
and administrative costs and operating costs incurred and attributable to the
conduct of the business affairs and operations of the Partnerships, computed on
a cost basis, determined in accordance with generally accepted accounting
principles. Such reimbursed costs and expenses allocated to the Partnerships
include office rent, secretarial, employee compensation and benefits, travel and
communication costs, fees for professional services, and other items generally
classified as general or administrative expense. When actual costs incurred
benefit other Partnerships and affiliates, the allocation of costs is based on
the relationship of the Partnerships' reserves to the total reserves owned by
all Partnerships and affiliates. The amount of general and administrative
expense allocated to the General Partner and its affiliates and charged to each
Partnership during 1999, 1998, and 1997 is set forth in the table below.
Although the actual costs incurred by the General Partner and its affiliates
have fluctuated during the three years presented, the amounts charged to the
Partnerships have not fluctuated due to expense limitations imposed by the
Partnership Agreements.
Partnership 1999 1998 1997
----------- -------- -------- --------
P-1 $113,760 $113,760 $113,760
P-2 94,836 94,836 94,836
P-3 178,560 178,560 178,560
P-4 132,960 132,960 132,960
P-5 124,680 124,680 124,680
P-6 150,564 150,564 150,564
None of the officers or directors of the General Partner receive
compensation directly from the Partnerships. The Partnerships reimburse the
General Partner or its affiliates for that portion of such officers' and
directors' salaries and expenses attributable to time devoted by such
individuals to the Partnerships' activities based on the allocation method
described above. The following tables indicate the approximate amount of general
and administrative expense reimbursement attributable to the salaries of the
directors, officers, and employees of the General Partner and its affiliates
during 1999, 1998, and 1997:
-52-
<PAGE>
<TABLE>
Salary Reimbursements
P-1 Partnership
---------------
<CAPTION>
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $67,960 - - - - - -
1998 $67,323 - - - - - -
1999 $69,485 - - - - - -
</TABLE>
- ----------
(1) The general and administrative expenses paid by the P-1 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-1 Partnership and no individual's salary or other
compensation reimbursement from the P-1 Partnership equals or exceeds
$100,000 per annum.
-53-
<PAGE>
<TABLE>
<CAPTION>
Salary Reimbursements
P-2 Partnership
---------------
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $56,655 - - - - - -
1998 $56,124 - - - - - -
1999 $57,926 - - - - - -
- ----------
(1) The general and administrative expenses paid by the P-2 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-2 Partnership and no individual's salary or other
compensation reimbursement from the P-2 Partnership equals or exceeds
$100,000 per annum.
</TABLE>
-54-
<PAGE>
<TABLE>
<CAPTION>
Salary Reimbursements
P-3 Partnership
---------------
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $106,672 - - - - - -
1998 $105,672 - - - - - -
1999 $109,064 - - - - - -
- ----------
(1) The general and administrative expenses paid by the P-3 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-3 Partnership and no individual's salary or other
compensation reimbursement from the P-3 Partnership equals or exceeds
$100,000 per annum.
</TABLE>
-55-
<PAGE>
<TABLE>
<CAPTION>
Salary Reimbursements
P-4 Partnership
---------------
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $79,430 - - - - - -
1998 $78,686 - - - - - -
1999 $81,212 - - - - - -
- ----------
(1) The general and administrative expenses paid by the P-4 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-4 Partnership and no individual's salary or other
compensation reimbursement from the P-4 Partnership equals or exceeds
$100,000 per annum.
</TABLE>
-56-
<PAGE>
<TABLE>
<CAPTION>
Salary Reimbursements
P-5 Partnership
---------------
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $74,484 - - - - - -
1998 $73,786 - - - - - -
1999 $76,155 - - - - - -
- ----------
(1) The general and administrative expenses paid by the P-5 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-5 Partnership and no individual's salary or other
compensation reimbursement from the P-5 Partnership equals or exceeds
$100,000 per annum.
</TABLE>
-57-
<PAGE>
<TABLE>
<CAPTION>
Salary Reimbursements
P-6 Partnership
---------------
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
----------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis R. Neill,
President(1)(2) 1997 - - - - - - -
1998 - - - - - - -
1999 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 1997 $89,947 - - - - - -
1998 $89,104 - - - - - -
1999 $91,964 - - - - - -
- ----------
(1) The general and administrative expenses paid by the P-6 Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Tholen or Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the P-6 Partnership and no individual's salary or other
compensation reimbursement from the P-6 Partnership equals or exceeds
$100,000 per annum.
</TABLE>
-58-
<PAGE>
Affiliates of the Partnerships serve as operator of some of the wells in
which the Partnerships own a Net Profits Interest. The owners of the working
interests in these wells contract with such affiliates for services as operator
of the wells. As operator, such affiliates are compensated at rates provided in
the operating agreements in effect and charged to all parties to such agreement.
Such compensation may occur both prior and subsequent to the commencement of
commercial marketing of production of oil or gas. The dollar amount of such
compensation which burdens the Partnerships' Net Profits Interests is impossible
to quantify as of the date of this Annual Report.
Samson maintains necessary inventories of new and used field equipment.
Samson may have provided some of this equipment for wells in which the
Partnerships have a Net Profits Interest. This equipment was provided at prices
or rates equal to or less than those normally charged in the same or comparable
geographic area by unaffiliated persons or companies dealing at arm's length.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table provides information as to the beneficial ownership of
the Units as of February 1, 2000 by (i) each beneficial owner of more than five
percent of the issued and outstanding Units, (ii) the director and officers of
the General Partner, and (iii) the General Partner and its affiliates. The
address of the General Partner, its officers and director, and Samson Resources
Company is Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103.
Number of Units
Beneficially
Owned (Percent
Beneficial Owner of Outstanding)
- -------------------------------------------- ---------------
P-1 Partnership:
- ---------------
Samson Resources Company 18,835 (17.4%)
All affiliates, directors, and officers of
the General Partner as a group and the
General Partner (4 persons) 18,835 (17.4%)
-59-
<PAGE>
P-2 Partnership:
- ---------------
Samson Resources Company 22,662 (25.2%)
Loma Linda University
Medical Center
P. O. Box 2000
Loma Linda, CA 92354 5,000 ( 5.5%)
All affiliates, directors, and officers
of the General Partner as a group and
the General Partner (4 persons) 22,662 (25.2%)
P-3 Partnership:
- ---------------
Samson Resources Company 45,958 (27.1%)
Merced County Retirement Association
Pension Trust
2222 M. Street
Merced, CA 95340 10,000 ( 5.9%)
All affiliates, directors, and officers
of the General Partner as a group and
the General Partner (4 persons) 45,958 (27.1%)
P-4 Partnership:
- ---------------
Samson Resources Company 26,044 (20.6%)
All affiliates, directors, and officers
of the General Partner as a group and
the General Partner (4 persons) 26,044 (20.6%)
P-5 Partnership:
- ---------------
Samson Resources Company 19,778 (16.7%)
All affiliates, directors, and officers
of the General Partner as a group and
the General Partner (4 persons) 19,778 (16.7%)
-60-
<PAGE>
P-6 Partnership:
- ---------------
Samson Resources Company 13,818 ( 9.7%)
ATL, Inc.
1200 Harbor Boulevard, 5th Floor
Weehawken, NJ 07087 54,887 (38.4%)
All affiliates, directors, and officers
of the General Partner as a group and
the General Partner (4 persons) 13,818 ( 9.7%)
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The General Partner and certain of its affiliates engage in oil and gas
activities independently of the Partnerships which result in conflicts of
interest that cannot be totally eliminated. The allocation of acquisition
opportunities and the nature of the compensation arrangements between the
Partnerships and the General Partner also create potential conflicts of
interest. An affiliate of the Partnerships owns some of the Partnerships' Units
and therefore has an identity of interest with other Limited Partners with
respect to the operations of the Partnerships.
In order to attempt to assure limited liability for the Limited Partners
as well as an orderly conduct of business, management of the Partnerships is
exercised solely by the General Partner. The Partnership Agreements grant the
General Partner broad discretionary authority with respect to the Partnerships'
expenditure and control of funds, including borrowings. These provisions are
similar to those contained in prospectuses and partnership agreements for other
public oil and gas partnerships. Broad discretion as to general management of
the Partnerships involves circumstances where the General Partner has conflicts
of interest and where it must allocate costs and expenses, or opportunities,
among the Partnerships and other competing interests.
The General Partner does not devote all of its time, efforts, and
personnel exclusively to the Partnerships. Furthermore, the Partnerships do not
have any employees, but instead rely on the personnel of Samson. The
Partnerships thus compete with Samson (including other oil and gas partnerships)
for the time and resources of such personnel. Samson devotes such time and
personnel to the management of the Partnerships as are indicated by the
circumstances and as are consistent with the General Partner's fiduciary duties.
-61-
<PAGE>
Affiliates of the Partnerships operate certain wells in which the
Partnerships have a net profits interest and are compensated for such services
at rates comparable to charges of unaffiliated third parties for services in the
same geographic area. These costs are charged to the owners of the working
interest of such wells and are considered when calculating the Net Profits
payable to the Partnerships. These costs are thus indirectly borne by the
Partnership.
Affiliates of the Partnerships are solely responsible for the negotiation,
administration, and enforcement of oil and gas sales agreements covering the
leasehold interests in which the Partnerships hold Net Profits Interests.
Because affiliates of the Partnerships who provide services to the owners of the
Working Interests have fiduciary or other duties to other members of Samson,
contract amendments and negotiating positions taken by them in their effort to
enforce contracts with purchasers may not necessarily represent the positions
that the owners of such Working Interests would take if they were to administer
their own contracts without involvement with other members of Samson. On the
other hand, management believes that the negotiating strength and contractual
positions of the owners of such Working Interests have been enhanced by virtue
of their affiliation with Samson.
-62-
<PAGE>
PART IV.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) Financial Statements, Financial Statement Schedules, and Exhibits.
(1) Financial Statements: The following financial statements for
the
Geodyne Institutional/Pension Energy Income
P-1 Limited Partnership
Geodyne Institutional/Pension Energy Income
P-2 Limited Partnership
Geodyne Institutional/Pension Energy Income
Limited Partnership P-3
Geodyne Institutional/Pension Energy Income
Limited Partnership P-4
Geodyne Institutional/Pension Energy Income
Limited Partnership P-5
Geodyne Institutional/Pension Energy Income
Limited Partnership P-6
as of December 31, 1999 and 1998 and for each of the three
years in the period ended December 31, 1999 are filed as part
of this report:
Report of Independent Accountants
Combined Balance Sheets
Combined Statements of Operations
Combined Statements of Changes in
Partners' Capital (Deficit)
Combined Statements of Cash Flows
Notes to Combined Financial Statements
(2) Financial Statement Schedules:
None.
(3) Exhibits:
4.1 The Certificate and Agreements of Limited Partnership
for the following Partnerships have been previously
filed with the SEC as Exhibit 2.1 to Form 8-A filed by
each Partnership on the dates shown below and are hereby
incorporated by reference.
-63-
<PAGE>
Partnership Filing Date File No.
----------- ----------- --------
P-1 June 5, 1989 0-17800
P-2 June 5, 1989 0-17800
P-3 February 20, 1990 0-18306
P-4 February 20, 1990 0-18306
P-5 November 13, 1990 0-18637
P-6 November 30, 1990 0-18937
4.2 The Agreements of Partnership for the following NPI
Partnerships have been previously filed with the SEC as
Exhibit 2.2 to Form 8-A filed by the related
Partnerships on the dates shown below and are hereby
incorporated by reference.
Form 8-A
Partnership Filing Date
----------- -----------------
P-1 June 5, 1989
P-2 June 5, 1989
P-3 February 20, 1990
P-4 February 20, 1990
P-5 June 11, 1990
P-6 December 10, 1990
4.3 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income P-1 Limited
Partnership, filed as Exhibit 4.1 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.4 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income P-2 Limited
Partnership, filed as Exhibit 4.2 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.5 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-3, filed as Exhibit 4.3 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
-64-
<PAGE>
4.6 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-4, filed as Exhibit 4.4 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.7 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-5, filed as Exhibit 4.5 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.8 Second Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-6, filed as Exhibit 4.6 to Registrants'
Current Report on Form 8-K dated August 2, 1993 filed
with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.9 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income P-1 Limited
Partnership, filed as Exhibit 4.10 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC April 1, 1996 and is hereby
incorporated by reference.
4.10 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income P-2 Limited
Partnership, filed as Exhibit 4.11 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC on April 1, 1996 and is
hereby incorporated by reference.
4.11 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-3, filed as Exhibit 4.12 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC on April 1, 1996 and is
hereby incorporated by reference.
-65-
<PAGE>
4.12 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-4, filed as Exhibit 4.13 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC on April 1, 1996 and is
hereby incorporated by reference.
4.13 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-5, filed as Exhibit 4.14 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC on April 1, 1996 and is
hereby incorporated by reference.
4.14 Third Amendment to Agreement of Limited Partnership of
Geodyne Institutional/Pension Energy Income Limited
Partnership P-6, filed as Exhibit 4.15 to Registrant's
Annual Report on Form 10-K for the year ended December
31, 1995 filed with the SEC on April 1, 1996 and is
hereby incorporated by reference.
* 23.1 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income P-1 Limited
Partnership.
* 23.2 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income P-2 Limited
Partnership.
* 23.3 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-3.
* 23.4 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-4.
* 23.5 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-5.
* 23.6 Consent of Ryder Scott Company, L.P. for the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-6.
-66-
<PAGE>
* 27.1 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income P-1 Limited
Partnership's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
* 27.2 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income P-2 Limited
Partnership's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
* 27.3 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-3's financial statements as of December 31, 1999 and
for the year ended December 31, 1999.
* 27.4 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-4's financial statements as of December 31, 1999 and
for the year ended December 31, 1999.
* 27.5 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-5's financial statements as of December 31, 1999 and
for the year ended December 31, 1999.
* 27.6 Financial Data Schedule containing summary financial
information extracted from the Geodyne
Institutional/Pension Energy Income Limited Partnership
P-6's financial statements as of December 31, 1999 and
for the year ended December 31, 1999.
All other Exhibits are omitted as inapplicable.
----------
*Filed herewith.
(b) Reports on Form 8-K filed during the fourth quarter of 1999.
None.
-67-
<PAGE>
SIGNATURES
Pursuant to the requirements of Sections 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 organized.
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME P-1 LIMITED PARTNERSHIP
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME P-2 LIMITED PARTNERSHIP
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME LIMITED PARTNERSHIP P-3
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME LIMITED PARTNERSHIP P-4
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME LIMITED PARTNERSHIP P-5
GEODYNE INSTITUTIONAL/PENSION ENERGY
INCOME LIMITED PARTNERSHIP P-6
By: GEODYNE RESOURCES, INC.
General Partner
February 21, 2000
By: /s/Dennis R. Neill
------------------------------
Dennis R. Neill
President
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 on the dates indicated.
By: /s/Dennis R. Neill President and February 21, 2000
------------------- Director (Principal
Dennis R. Neill Executive Officer)
/s/Patrick M. Hall (Principal February 21, 2000
------------------- Financial and
Patrick M. Hall Accounting Officer)
/s/Judy K. Fox Secretary February 21, 2000
-------------------
Judy K. Fox
-68-
<PAGE>
ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP AND GEODYNE
NPI PARTNERSHIP P-1
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income P-1 Limited
Partnership, a Texas limited partnership, and Geodyne NPI Partnership P-1, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-1
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-1
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 182,743 $ 99,454
Accounts receivable:
Net Profits 167,901 108,440
--------- ---------
Total current assets $ 350,644 $ 207,894
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 1,003,826 1,164,893
--------- ---------
$1,354,470 $1,372,787
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 77,417) ($ 82,899)
Limited Partners, issued and
outstanding, 108,074 Units 1,431,887 1,455,686
--------- ---------
Total Partners' capital $1,354,470 $1,372,787
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-2
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-1
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ----------
REVENUES:
Net Profits $802,539 $ 694,919 $1,064,105
Interest income 4,639 11,731 11,117
Gain on sale of
Net Profits Interests 698 476,752 380,408
------- --------- ---------
$807,876 $1,183,402 $1,455,630
COSTS AND EXPENSES:
Depletion of
Net Profits Interests $171,326 $ 235,071 $ 263,691
Impairment provision - - 902,042
General and
Administrative 127,487 127,207 129,205
------- --------- ---------
$298,813 $ 362,278 $1,294,938
------- --------- ---------
NET INCOME $509,063 $ 821,124 $ 160,692
======= ========= =========
GENERAL PARTNER -
NET INCOME $ 65,862 $ 60,539 $ 54,016
======= ========= =========
LIMITED PARTNERS -
NET INCOME $443,201 $ 760,585 $ 106,676
======= ========= =========
NET INCOME
per Unit $ 4.10 $ 7.04 $ .99
======= ========= =========
UNITS OUTSTANDING 108,074 108,074 108,074
======= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-3
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-1
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998, and 1997
Limited General
Partners Partner Combined
------------ --------- ------------
Balance, Dec. 31, 1996 $3,293,425 ($62,666) $3,230,759
Net income 106,676 54,016 160,692
Cash distributions ( 1,236,000) ( 78,765) ( 1,314,765)
--------- ------ ---------
Balance, Dec. 31, 1997 $2,164,101 ($87,415) $2,076,686
Net income 760,585 60,539 821,124
Cash distributions ( 1,469,000) ( 56,023) ( 1,525,023)
--------- ------ ---------
Balance, Dec. 31, 1998 $1,455,686 ($82,899) $1,372,787
Net income 443,201 65,862 509,063
Cash distributions ( 467,000) ( 60,380) ( 527,380)
--------- ------ ---------
Balance, Dec. 31, 1999 $1,431,887 ($77,417) $1,354,470
========= ====== =========
The accompanying notes are an integral
part of these combined financial statements.
F-4
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-1 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-1
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ----------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $509,063 $ 821,124 $ 160,692
Adjustments to reconcile
net income to
net cash provided by
operating activities:
Depletion of Net
Profits Interests 171,326 235,071 263,691
Impairment provision - - 902,042
Gain on sale of
Net Profits Interests ( 698) ( 476,752) ( 380,408)
(Increase)decrease in
accounts receivable
- Net Profits ( 59,461) 56,204 92,814
------- --------- ---------
Net cash provided by
operating activities $620,230 $ 635,647 $1,038,831
------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 13,017) ($ 34,624) ($ 21,339)
Proceeds from sale of
Net Profits Interests 3,456 519,832 507,599
------- --------- ---------
Net cash provided (used) by
investing activities ($ 9,561) $ 485,208 $ 486,260
------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($527,380) ($1,525,023) ($1,314,765)
------- --------- ---------
Net cash used by financing
Activities ($527,380) ($1,525,023) ($1,314,765)
------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 83,289 ($ 404,168) $ 210,326
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 99,454 503,622 293,296
------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $182,743 $ 99,454 $ 503,622
======= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-5
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP AND GEODYNE
NPI PARTNERSHIP P-2
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income P-2 Limited
Partnership, a Texas limited partnership, and Geodyne NPI Partnership P-2, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-6
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-2
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 148,106 $ 78,435
Accounts receivable:
Net Profits 135,136 92,746
--------- ---------
Total current assets $ 283,242 $ 171,181
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 856,093 1,001,498
--------- ---------
$1,139,335 $1,172,679
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 56,585) ($ 70,704)
Limited Partners, issued and
outstanding, 90,094 Units 1,195,920 1,243,383
--------- ---------
Total Partners' capital $1,139,335 $1,172,679
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-7
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-2
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
---------- -------- ----------
REVENUES:
Net Profits $618,890 $538,185 $ 836,494
Interest income 3,769 8,577 8,532
Gain on sale of
Net Profits Interests 472 328,122 284,247
------- --------- ----------
$623,131 $874,884 $1,129,273
COSTS AND EXPENSES:
Depletion of Net
Profits Interests $152,202 $187,490 $ 207,379
Impairment provision - - 727,893
General and
Administrative 106,335 106,064 107,544
------- ------- ----------
$258,537 $293,554 $1,042,816
------- ------- ----------
NET INCOME $364,594 $581,330 $ 86,457
======= ======= ==========
GENERAL PARTNER -
NET INCOME $ 31,057 $ 36,137 $ 41,244
======= ======= ==========
LIMITED PARTNERS -
NET INCOME $333,537 $545,193 $ 45,213
======= ======= ==========
NET INCOME
per Unit $ 3.70 $ 6.05 $ .50
======= ======== ==========
UNITS OUTSTANDING 90,094 90,094 90,094
======= ======== ==========
The accompanying notes are an integral
part of these combined financial statements.
F-8
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-2
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998, and 1997
Limited General
Partners Partner Combined
------------ --------- ------------
Balance, Dec. 31, 1996 $2,692,977 ($57,428) $2,635,549
Net income 45,213 41,244 86,457
Cash distributions ( 979,000) ( 56,254) ( 1,035,254)
--------- ------ ---------
Balance, Dec. 31, 1997 $1,759,190 ($72,438) $1,686,752
Net income 545,193 36,137 581,330
Cash distributions ( 1,061,000) ( 34,403) ( 1,095,403)
--------- ------ ---------
Balance, Dec. 31, 1998 $1,243,383 ($70,704) $1,172,679
Net income 333,537 31,057 364,594
Cash distributions ( 381,000) ( 16,938) ( 397,938)
--------- ------ ---------
Balance, Dec. 31, 1999 $1,195,920 ($56,585) $1,139,335
========= ====== =========
The accompanying notes are an integral
part of these combined financial statements.
F-9
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME P-2 LIMITED PARTNERSHIP
GEODYNE NPI PARTNERSHIP P-2
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $364,594 $ 581,330 $ 86,457
Adjustments to reconcile
net income to
net cash provided by
operating activities:
Depletion of Net
Profits Interests 152,202 187,490 207,379
Impairment provision - - 727,893
Gain on sale of
Net Profits Interests ( 472) ( 328,122) ( 284,247)
(Increase) decrease in
accounts receivable
- Net Profits ( 42,390) 42,585 67,956
Decrease in
accounts receivable
- General Partner - - 8,376
------- --------- ----------
Net cash provided by
operating activities $473,934 $ 483,283 $ 813,814
------- --------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 10,319) ($ 39,322) ($ 34,745)
Proceeds from sale of
Net Profits Interests 3,994 360,686 402,870
------- --------- ----------
Net cash provided (used)
by investing activities ($ 6,325) $ 321,364 $ 368,125
------- --------- ----------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($397,938) ($1,095,403) ($1,035,254)
------- --------- ----------
Net cash used by financing
Activities ($397,938) ($1,095,403) ($1,035,254)
------- --------- ----------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 69,671 ($ 290,756) $ 146,685
F-10
<PAGE>
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 78,435 369,191 222,506
------- --------- ----------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $148,106 $ 78,435 $ 369,191
======= ========= ==========
The accompanying notes are an integral
part of these combined financial statements.
F-11
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3 AND GEODYNE
NPI PARTNERSHIP P-3
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income Limited Partnership
P-3, an Oklahoma limited partnership, and Geodyne NPI Partnership P-3, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-12
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3
GEODYNE NPI PARTNERSHIP P-3
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 284,040 $ 146,246
Accounts receivable:
Net Profits 251,484 170,389
--------- ---------
Total current assets $ 535,524 $ 316,635
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 1,595,636 1,866,716
--------- ---------
$2,131,160 $2,183,351
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 113,709) ($ 132,995)
Limited Partners, issued and
outstanding, 169,637 Units 2,244,869 2,316,346
--------- ---------
Total Partners' capital $2,131,160 $2,183,351
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-13
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3
GEODYNE NPI PARTNERSHIP P-3
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
REVENUES:
Net Profits $1,155,814 $ 997,464 $1,559,975
Interest income 7,380 16,358 16,329
Gain on sale of
Net Profits Interests 968 606,887 532,904
--------- --------- ---------
$1,164,162 $1,620,709 $2,109,208
COSTS AND EXPENSES:
Depletion of Net
Profits Interests $ 283,838 $ 344,697 $ 385,937
Impairment provision - - 1,413,917
General and
Administrative 199,790 199,679 202,308
--------- --------- ---------
$ 483,628 $ 544,376 $2,002,162
--------- --------- ---------
NET INCOME $ 680,534 $1,076,333 $ 107,046
========= ========= =========
GENERAL PARTNER -
NET INCOME $ 45,011 $ 66,787 $ 76,414
========= ========= =========
LIMITED PARTNERS -
NET INCOME $ 635,523 $1,009,546 $ 30,632
========= ========= =========
NET INCOME
per Unit $ 3.75 $ 5.95 $ .18
========= ========= =========
UNITS OUTSTANDING 169,637 169,637 169,637
========= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-14
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3
GEODYNE NPI PARTNERSHIP P-3
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998, and 1997
Limited General
Partners Partner Combined
------------- ---------- ------------
Balance, Dec. 31, 1996 $5,075,168 ($107,085) $4,968,083
Net income 30,632 76,414 107,046
Cash distributions ( 1,832,000) ( 106,587) ( 1,938,587)
--------- ------- ---------
Balance, Dec. 31, 1997 $3,273,800 ($137,258) $3,136,542
Net income 1,009,546 66,787 1,076,333
Cash distributions ( 1,967,000) ( 62,524) ( 2,029,524)
--------- ------- ---------
Balance, Dec. 31, 1998 $2,316,346 ($132,995) $2,183,351
Net income 635,523 45,011 680,534
Cash distributions ( 707,000) ( 25,725) ( 732,725)
--------- ------- ---------
Balance, Dec. 31, 1999 $2,244,869 ($113,709) $2,131,160
========= ======= =========
The accompanying notes are an integral
part of these combined financial statements.
F-15
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-3
GEODYNE NPI PARTNERSHIP P-3
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $680,534 $1,076,333 $ 107,046
Adjustments to reconcile
net income to
net cash provided by
operating activities:
Depletion of Net
Profits Interests 283,838 344,697 385,937
Impairment provision - - 1,413,917
Gain on sale of
Net Profits Interests ( 968) ( 606,887) ( 532,904)
(Increase) decrease in
accounts receivable
- Net Profits ( 81,095) 84,081 125,255
Decrease in
accounts receivable
- General Partner - - 16,473
------- --------- ---------
Net cash provided by
operating activities $882,309 $ 898,224 $1,515,724
------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 19,188) ($ 74,335) ($ 66,502)
Proceeds from sale of
Net Profits Interests 7,398 666,253 759,639
------- --------- ---------
Net cash provided (used)
by investing activities ($ 11,790) $ 591,918 $ 693,137
------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($732,725) ($2,029,524) ($1,938,587)
------- --------- ---------
Net cash used by financing
Activities ($732,725) ($2,029,524) ($1,938,587)
------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $137,794 ($ 539,382) $ 270,274
F-16
<PAGE>
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 146,246 685,628 415,354
------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $284,040 $ 146,246 $ 685,628
======= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-17
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4 AND GEODYNE
NPI PARTNERSHIP P-4
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income Limited Partnership
P-4, an Oklahoma limited partnership, and Geodyne NPI Partnership P-4, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-18
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4
GEODYNE NPI PARTNERSHIP P-4
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 188,928 $ 101,652
Accounts receivable:
Net Profits 255,972 209,218
--------- ---------
Total current assets $ 444,900 $ 310,870
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 892,659 1,092,574
--------- ---------
$1,337,559 $1,403,444
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 80,321) ($ 93,853)
Limited Partners, issued and
outstanding, 126,306 Units 1,417,880 1,497,297
--------- ---------
Total Partners' capital $1,337,559 $1,403,444
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-19
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4
GEODYNE NPI PARTNERSHIP P-4
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
REVENUES:
Net Profits $746,854 $734,526 $1,290,780
Interest income 4,983 8,219 13,072
Gain on sale of
Net Profits Interests 410 12,332 63,002
------- ------- ---------
$752,247 $755,077 $1,366,854
COSTS AND EXPENSES:
Depletion of Net
Profits Interests $199,980 221,558 $ 364,709
Impairment provision - - 752,388
General and
Administrative 148,395 148,616 148,419
------- ------- ---------
$348,375 $370,174 $1,265,516
------- ------- ---------
NET INCOME $403,872 $384,903 $ 101,338
======= ======= =========
GENERAL PARTNER -
NET INCOME $ 36,289 $ 27,697 $ 49,097
======= ======= =========
LIMITED PARTNERS -
NET INCOME $367,583 $357,206 $ 52,241
======= ======= =========
NET INCOME
per Unit $ 2.91 $ 2.83 $ .41
======= ======= =========
UNITS OUTSTANDING 126,306 126,306 126,306
======= ======= =========
The accompanying notes are an integral
part of these combined financial statements.
F-20
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4
GEODYNE NPI PARTNERSHIP P-4
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998, and 1997
Limited General
Partners Partner Combined
------------ ---------- ------------
Balance, Dec. 31, 1996 $3,364,850 ($ 81,373) $3,283,477
Net income 52,241 49,097 101,338
Cash distributions ( 1,495,000) ( 62,523) ( 1,557,523)
--------- ------- ---------
Balance, Dec. 31, 1997 $1,922,091 ($ 94,799) $1,827,292
Net income 357,206 27,697 384,903
Cash distributions ( 782,000) ( 26,751) ( 808,751)
--------- ------- ---------
Balance, Dec. 31, 1998 $1,497,297 ($ 93,853) $1,403,444
Net income 367,583 36,289 403,872
Cash distributions ( 447,000) ( 22,757) ( 469,757)
--------- ------- ---------
Balance, Dec. 31, 1999 $1,417,880 ($ 80,321) $1,337,559
========= ======= =========
The accompanying notes are an integral
part of these combined financial statements.
F-21
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-4
GEODYNE NPI PARTNERSHIP P-4
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ---------- ----------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $403,872 $384,903 $ 101,338
Adjustments to reconcile
net income to net cash
provided by operating activities:
Depletion of Net
Profits Interests 199,980 221,558 364,709
Impairment provision - - 752,388
Gain on sale of
Net Profits Interests ( 410) ( 12,332) ( 63,002)
(Increase) decrease in
accounts receivable -
Net Profits ( 46,754) 91,842 68,880
-------- ------- --------
Net cash provided by
operating activities $556,688 $685,971 $1,224,313
------- ------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 6,108) ($ 35,489) ($ 35,028)
Proceeds from sale of
Net Profits Interests 6,453 16,018 266,265
------- ------- ---------
Net cash provided (used)
by investing activities $ 345 ($ 19,471) $ 231,237
------- ------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($469,757) ($808,751) ($1,557,523)
------- ------- ---------
Net cash used by financing
Activities ($469,757) ($808,751) ($1,557,523)
------- ------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 87,276 ($142,251) ($ 101,973)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 101,652 243,903 345,876
------- ------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $188,928 $101,652 $ 243,903
======= ======= =========
The accompanying notes are an integral
part of these combined financial statements.
F-22
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5 AND GEODYNE
NPI PARTNERSHIP P-5
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income Limited Partnership
P-5, an Oklahoma limited partnership, and Geodyne NPI Partnership P-5, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-23
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5
GEODYNE NPI PARTNERSHIP P-5
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 217,441 $ 166,487
Accounts receivable:
Net Profits 180,909 99,823
--------- ---------
Total current assets $ 398,350 $ 266,310
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 836,971 991,179
--------- ---------
$1,235,321 $1,257,489
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 68,638) ($ 79,248)
Limited Partners, issued and
outstanding, 118,449 Units 1,303,959 1,336,737
--------- ---------
Total Partners' capital $1,235,321 $1,257,489
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-24
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5
GEODYNE NPI PARTNERSHIP P-5
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
REVENUES:
Net Profits $856,442 $ 827,076 $1,000,125
Interest income 6,181 9,987 8,836
Gain (loss)on sale of
Net Profits Interests ( 92) 344,575 79,182
------- --------- ---------
$862,531 $1,181,638 $1,088,143
COSTS AND EXPENSES:
Depletion of Net
Profits Interests $169,734 $ 283,071 $ 249,055
Impairment provision - - 1,018,068
General and
Administrative 139,426 139,230 141,907
------- --------- ---------
$309,160 $ 422,301 $1,409,030
------- --------- ---------
NET INCOME (LOSS) $553,371 $ 759,337 ($ 320,887)
======= ========= =========
GENERAL PARTNER -
NET INCOME $ 34,149 $ 48,790 $ 34,199
======= ========= =========
LIMITED PARTNERS -
NET INCOME (LOSS) $519,222 $ 710,547 ($ 355,086)
======= ========= =========
NET INCOME (LOSS)
per Unit $ 4.38 $ 6.00 ($ 3.00)
======= ========= =========
UNITS OUTSTANDING 118,449 118,449 118,449
======= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-25
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5
GEODYNE NPI PARTNERSHIP P-5
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998, and 1997
Limited General
Partners Partner Combined
------------ ---------- ------------
Balance, Dec. 31, 1996 $3,053,276 ($60,088) $2,993,188
Net income (loss) ( 355,086) 34,199 ( 320,887)
Cash distributions ( 1,002,000) ( 48,794) ( 1,050,794)
--------- ------ ---------
Balance, Dec. 31, 1997 $1,696,190 ($74,683) $1,621,507
Net income 710,547 48,790 759,337
Cash distributions ( 1,070,000) ( 53,355) ( 1,123,355)
--------- ------ ---------
Balance, Dec. 31, 1998 $1,336,737 ($79,248) $1,257,489
Net income 519,222 34,149 553,371
Cash distributions ( 552,000) ( 23,539) ( 575,539)
--------- ------ ---------
Balance, Dec. 31, 1999 $1,303,959 ($68,638) $1,235,321
========= ====== =========
The accompanying notes are an integral
part of these combined financial statements.
F-26
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-5
GEODYNE NPI PARTNERSHIP P-5
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss) $553,371 $ 759,337 ($ 320,887)
Adjustments to reconcile
net income (loss) to
net cash provided by
operating activities:
Depletion of Net
Profits Interests 169,734 283,071 249,055
Impairment provision - - 1,018,068
(Gain) loss on sale of
Net Profits Interests 92 ( 344,575) ( 79,182)
(Increase) decrease in
accounts receivable -
Net Profits ( 81,086) 35,145 74,090
------- --------- ---------
Net cash provided by
operating activities $642,111 $ 732,978 $ 941,144
------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 15,618) ($ 40,371) ($ 980)
Proceeds from sale of
Net Profits Interests - 368,485 91,840
------- --------- ---------
Net cash provided (used)
by investing activities ($ 15,618) $ 328,114 $ 90,860
------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($575,539) ($1,123,355) ($1,050,794)
------- --------- ---------
Net cash used by financing
Activities ($575,539) ($1,123,355) ($1,050,794)
------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 50,954 ($ 62,263) ($ 18,790)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 166,487 228,750 247,540
------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $217,441 $ 166,487 $ 228,750
======= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-27
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE PARTNERS
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-6 AND GEODYNE
NPI PARTNERSHIP P-6
In our opinion, the accompanying combined balance sheets and the related
combined statements of operations, changes in partners' capital (deficit) and
cash flows present fairly, in all material respects, the combined financial
position of the Geodyne Institutional/Pension Energy Income Limited Partnership
P-6, an Oklahoma limited partnership, and Geodyne NPI Partnership P-6, an
Oklahoma general partnership, at December 31, 1999 and 1998, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Partnerships' management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
February 15, 2000
F-28
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME LIMITED PARTNERSHIP P-6
GEODYNE NPI PARTNERSHIP P-6
Combined Balance Sheets
December 31, 1999 and 1998
ASSETS
------
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 339,386 $ 300,324
Accounts receivable:
Net Profits 177,661 145,612
--------- ---------
Total current assets $ 517,047 $ 445,936
NET PROFITS INTERESTS, net, utilizing
the successful efforts method 1,797,167 2,065,846
--------- ---------
$2,314,214 $2,511,782
========= =========
PARTNERS' CAPITAL (DEFICIT)
---------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 86,400) ($ 106,642)
Limited Partners, issued and
outstanding, 143,041 Units 2,400,614 2,618,424
--------- ---------
Total Partners' capital $2,314,214 $2,511,782
========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-29
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME
LIMITED PARTNERSHIP P-6
GEODYNE NPI PARTNERSHIP P-6
Combined Statements of Operations
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
---------- ------------ ----------
REVENUES:
Net Profits $1,340,784 $1,240,100 $1,793,685
Interest income 9,614 13,521 15,425
Gain (loss) on sale -
Net Profits Interests ( 32) 135,752 37,698
--------- -------- ---------
$1,350,366 $1,389,373 $1,846,808
COSTS AND EXPENSES:
Depletion of Net
Profits Interests $ 330,171 $ 425,026 $ 610,647
Impairment provision - - 898,584
General and
Administrative 168,704 168,434 171,754
--------- --------- ---------
$ 498,875 $ 593,460 $1,680,985
--------- --------- ---------
NET INCOME $ 851,491 $ 795,913 $ 165,823
========= ========= =========
GENERAL PARTNER -
NET INCOME $ 55,301 $ 56,121 $ 67,889
========= ========= =========
LIMITED PARTNERS -
NET INCOME $ 796,190 $ 739,792 $ 97,934
========= ========= =========
NET INCOME
per unit $ 5.57 $ 5.17 $ .68
========= ========= =========
UNITS OUTSTANDING 143,041 143,041 143,041
========= ========= =========
The accompanying notes are an integral part of these
combined financial statements.
F-30
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME
LIMITED PARTNERSHIP P-6
GEODYNE NPI PARTNERSHIP P-6
Combined Statements of Changes in Partners' Capital (Deficit)
For the Years Ended December 31, 1999, 1998 and 1997
Limited General
Partners Partner Combined
------------ ---------- -----------
Balance, Dec. 31, 1996 $4,773,698 ($ 59,021) $4,714,677
Net income 97,934 67,889 165,823
Cash distributions ( 1,663,000) ( 105,382) ( 1,768,382)
--------- ------- ---------
Balance, Dec. 31, 1997 $3,208,632 ($ 96,514) $3,112,118
Net income 739,792 56,121 795,913
Cash distributions ( 1,330,000) ( 66,249) ( 1,396,249)
--------- ------- ---------
Balance, Dec. 31, 1998 $2,618,424 ($106,642) $2,511,782
Net income 796,190 55,301 851,491
Cash distributions ( 1,014,000) ( 35,059) ( 1,049,059)
--------- ------- ---------
Balance, Dec. 31, 1999 $2,400,614 ($ 86,400) $2,314,214
========= ======= =========
The accompanying notes are an integral
part of these combined financial statements.
F-31
<PAGE>
GEODYNE INSTITUTIONAL/PENSION ENERGY INCOME
LIMITED PARTNERSHIP P-6
GEODYNE NPI PARTNERSHIP P-6
Combined Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
1999 1998 1997
------------ ------------ -----------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $ 851,491 $ 795,913 $ 165,823
Adjustments to reconcile
net income to net
cash provided by
operating activities:
Depletion of Net
Profits Interests 330,171 425,026 610,647
Impairment provision - - 898,584
(Gain) loss on sale of
Net Profits Interests 32 ( 135,752) ( 37,698)
(Increase) decrease in
accounts receivable -
Net Profits ( 32,049) 145,740 136,720
--------- --------- ---------
Net cash provided by
operating activities $1,149,645 $1,230,927 $1,774,076
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 61,524) ($ 45,058) ($ 6,041)
Proceeds from sale of
Net Profits Interests - 147,747 43,605
--------- --------- ---------
Net cash provided (used)
by investing activities ($ 61,524) $ 102,689 $ 37,564
--------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($1,049,059) ($1,396,249) ($1,768,382)
--------- --------- ---------
Net cash used by financing
Activities ($1,049,059) ($1,396,249) ($1,768,382)
--------- --------- ---------
F-32
<PAGE>
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 39,062 ($ 62,633) $ 43,258
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 300,324 362,957 319,699
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 339,386 $ 300,324 $ 362,957
========= ========= =========
The accompanying notes are an integral
part of these combined financial statements.
F-33
<PAGE>
GEODYNE INSTITUTIONAL/PENSION PROGRAM
Notes to the Combined Financial Statements For the Periods
Ended December 31, 1999, 1998, and 1997
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Nature of Operations
The Geodyne Institutional/Pension Energy Income Limited Partnerships (the
"Partnerships") were formed pursuant to a public offering of depositary units
("Units"). Upon formation, investors became limited partners (the "Limited
Partners") and held Units issued by each Partnership. Geodyne Resources, Inc.
("Geodyne") is the general partner of each of the Partnerships. Each Partnership
is a general partner in the related Geodyne NPI Partnership (the "NPI
Partnerships") in which Geodyne serves as the managing partner. Limited
Partners' capital contributions were contributed to the related NPI Partnerships
for investment in net profits interests, royalty interests, and other
nonoperating interests in producing oil and gas properties. Most of the net
profits interests acquired by the Partnerships have been carved out of working
interests in producing properties, located in the continental United States,
which were acquired by affiliated oil and gas investment programs (the
"Affiliated Programs").
Net profits interests entitle the Partnerships to a share of net revenues
from producing properties measured by a specific percentage of the net profits
realized by such Affiliated Programs as owners of the working interests in the
producing properties. Except where otherwise noted, references to certain
operational activities of the Partnerships are actually the activities of the
Affiliated Programs. As the holder of a net profits interest, a Partnership is
not liable to pay any amount by which oil and gas operating costs and expenses
exceed revenues for any period, although any deficit, together with interest, is
applied to reduce the amounts payable to the Partnership in subsequent periods.
As used in these financial statements, the Partnerships' net profits and royalty
interests in oil and gas sales are referred to as "Net Profits" and the
Partnerships' net profits and royalty interests in oil and gas properties are
referred to as "Net Profits Interests." The Partnerships do not directly bear
capital costs. However, the Partnerships indirectly bear certain capital costs
incurred by the Affiliated Programs to the extent such capital costs are charged
against the applicable oil and gas revenues in calculating the net profits
payable to the Partnerships. For financial reporting purposes only, such capital
costs are reported as capital expenditures in the Partnerships' Statements of
Cash Flows.
The Partnerships were activated on the following dates with the following
Limited Partner capital contributions:
F-34
<PAGE>
Limited Partner
Date of Capital
Partnership Activation Contributions
----------- ----------------- ---------------
P-1 October 25, 1988 $10,807,400
P-2 February 9, 1989 9,009,400
P-3 May 10, 1989 16,963,700
P-4 November 21, 1989 12,630,600
P-5 February 27, 1990 11,844,900
P-6 September 5, 1990 14,304,100
For purposes of these financial statements, the Partnerships and NPI
Partnerships are collectively referred to as the "Partnerships" and the general
partner and managing partner are collectively referred to as the "General
Partner". An affiliate of the General Partner owned the following Units at
December 31, 1999:
Percent of
Number of Outstanding
Partnership Units Owned Units
----------- ----------- -----------
P-1 18,835 17.4%
P-2 22,610 25.1%
P-3 45,938 27.1%
P-4 26,044 20.6%
P-5 19,778 16.7%
P-6 13,818 9.7%
The Partnerships' sole business is owning Net Profits Interests.
Substantially all of the gas reserves attributable to the Partnerships' Net
Profits Interests are being sold regionally on the "spot market." Due to the
highly competitive nature of the spot market, prices on the spot market are
subject to wide seasonal and regional pricing fluctuations. In addition, such
spot market sales are generally short term in nature and are dependent upon the
obtaining of transportation services provided by pipelines. The Partnerships'
oil is sold at or near the Partnerships' wells under short-term purchase
contracts at prevailing arrangements which are customary in the oil industry.
The prices received for the Partnerships' oil and gas are subject to influences
such as global consumption and supply trends.
F-35
<PAGE>
Allocation of Costs and Revenues
The combination of the allocation provisions in each Partnerships' limited
partnership agreement and NPI Partnerships' partnership agreement (collectively,
the "Partnership Agreement") results in allocations of costs and income between
the Limited Partners and General Partner as follows:
Before Payout(1) After Payout(1)
-------------------- --------------------
General Limited General Limited
Partner Partners Partner Partners
------- -------- ------- --------
Costs(2)
- -------------------------
Sales commissions, payment
for organization and
offering costs and
acquisition fee 1% 99% - -
Property Acquisition
Costs 1% 99% 1% 99%
General and administrative
costs and direct
administrative costs(3) 5% 95% 15% 85%
Income(2)
- -------------------------
Temporary investments of
Limited Partners'
Subscriptions 1% 99% 1% 99%
Income from oil and
gas production(3) 5% 95% 15% 85%
Gain on sale of
Net Profits Interests(3) 5% 95% 15% 85%
All other income(3) 5% 95% 15% 85%
- ----------
(1) Payout occurs when total distributions to Limited Partners equal total
original Limited Partner subscriptions.
(2) The allocations in the table result generally from the combined effect of
the allocation provisions in the Partnership Agreements. For example,
direct administrative costs of the NPI Partnership are allocated 95.9596%
to the Partnership and 4.0404% to the managing partner. The 95.9596%
portion of these costs allocated to the limited partnership, when passed
through the limited partnership, is further allocated 99% to the Limited
Partners and 1% to the general partner. In this manner the Limited
Partners are allocated 95% of such costs and the General Partner is
allocated 5% of such costs.
F-36
<PAGE>
(3) If, at payout, the total distributions received by the Limited Partners
from the commencement of the property investment period have averaged on
an annualized basis an amount that is less than 12% of the Limited
Partners' subscriptions, the percentage of income, and costs which are
shared in the same proportions as income, allocated to the General Partner
will increase to only 10% and the Limited Partners will be allocated 90%
thereof until such time, if ever, that the distributions to the Limited
Partners from the commencement of the property investment period reaches a
yearly average equal to at least 12% of the Limited Partners'
subscriptions. Thereafter, income, and costs shared in the same
proportions as income, will be allocated 15% to the General Partner and
85% to the Limited Partners.
The P-1 Partnership achieved payout during the third quarter of 1998 and
the P-2 and P-4 Partnerships achieved payout during the fourth quarter of 1999.
After payout, operations and revenues for the P-1, P-2, and P-4 Partnerships
have been and will be allocated using the 10%/90% after payout percentages set
forth in Footnote 3 to the table above.
Basis of Presentation
These financial statements reflect the combined accounts of each
Partnership after the elimination of all inter-partnership transactions and
balances.
Cash and Cash Equivalents
The Partnerships consider all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents. Cash equivalents are
not insured, which cause the Partnerships to be subject to risk.
Credit Risk
Accrued oil and gas sales, which are included in the Partnerships'
Accounts Receivable - Net Profits, are due from a variety of oil and gas
purchasers and, therefore, indirectly subject the Partnerships to a
concentration of credit risk. Some of these purchasers are discussed in Note 3 -
Major Customers.
Net Profits Interests
The Partnerships follow the successful efforts method of accounting for
their Net Profits Interests. Under the successful efforts method, the
Partnerships capitalize all acquisition costs. Such acquisition costs include
costs incurred by the Partnerships or the General Partner to acquire a Net
Profits Interest, including related title insurance or examination costs,
commissions, engineering, legal and accounting fees, and similar
F-37
<PAGE>
costs directly related to the acquisitions plus an allocated portion of the
General Partner's property screening costs. The net acquisition cost to the
Partnerships of the Net Profits Interests in properties acquired by the General
Partner consists of the cost of acquiring the underlying properties, adjusted
for the net cash results of operations, including interest incurred to finance
the net acquisition, for the period of time the properties are held by the
General Partner. Impairment of Net Profits Interests in unproved oil and gas
properties is recognized based upon an individual property assessment. Upon
discovery of commercial reserves, Net Profits Interests in unproved properties
are transferred to producing properties.
Depletion of the cost of Net Profits Interests is computed on the
units-of-production method. The Partnerships' calculation of depletion of its
Net Profits Interests includes estimated dismantlement and abandonment costs,
net of estimated salvage values. The depletion rate per equivalent barrel of oil
produced during the years ended December 31, 1999, 1998, and 1997 were as
follows:
Partnership 1999 1998 1997
----------- ---- ---- ----
P-1 $2.03 $2.93 $2.88
P-2 2.31 2.97 2.84
P-3 2.31 2.94 2.83
P-4 2.70 2.82 3.46
P-5 2.01 2.88 2.65
P-6 1.96 2.40 3.34
The Partnerships evaluate the recoverability of the carrying costs of
their Net Profits Interests in proved oil and gas properties at the field level.
If the unamortized costs of a Net Profits Interest within a field exceed the
expected undiscounted future cash flows from such Net Profits Interest, the cost
of the Net Profits Interest is written down to fair value, which is determined
by using the discounted future cash flows from the Net Profits Interest. During
1999, 1998, and 1997, the Partnerships recorded the following non-cash charges
against earnings (impairment provisions):
Partnership 1999 1998 1997
----------- ---- ---- ----
P-1 $ - $ - $ 113,945
P-2 - - 113,005
P-3 - - 220,449
P-4 - - 84,059
P-5 - - 122,458
P-6 - - 444,990
The risk that the Partnerships will be required to record similar impairment
provisions in the future increases as oil and gas prices decrease.
F-38
<PAGE>
In addition, during 1997 the General Partner determined that the
Partnerships' Net Profits Interests in unproved properties would be uneconomic
to develop and, therefore, of little or no value. This determination was based
on an evaluation by the General Partner that it was unlikely that these unproved
properties would be developed due to low oil and gas prices and limitations on
the level of permissible indirect drilling activity through its Affiliated
Programs. As a result, the Partnerships recorded the following non-cash charges
against earnings at March 31, 1997 in order to reflect the writing-off of the
Partnerships' Net Profits Interests in unproved properties:
Partnership Amount
----------- -----------
P-1 $ 788,097
P-2 614,888
P-3 1,193,468
P-4 668,329
P-5 895,610
P-6 453,594
Accounts Receivable (Accounts Payable) - Net Profits
Revenues from a Net Profits Interest consist of a share of the oil and gas
sales of the property, less operating and production expenses. The Partnerships
accrue for oil and gas revenues less expenses from its Net Profits Interests.
Sales of gas applicable to the Net Profits Interests are recorded as revenue
when the gas is metered and title transferred pursuant to the gas sales
contracts. During such times as sales of gas exceed a Partnership's pro rata Net
Profits Interest in a well, such sales are recorded as revenue unless total
sales from the well have exceeded the Partnership's share of estimated total gas
reserves attributable to the underlying property, at which time such excess is
recorded as a liability. The rates per Mcf used to calculate the liability are
based on the average gas price received for the volumes at the time the
overproduction occurred. This also approximates the price for which the
Partnerships are currently settling this liability. This liability is recorded
as a reduction of accounts receivable.
Also included in accounts receivable (accounts payable) - Net Profits are
amounts which represent costs deferred or accrued for Net Profits relating to
lease operating expenses incurred in connection with the net underproduced or
overproduced gas imbalance positions. The rate used in calculating the deferred
charge or accrued liability is the average of the annual production costs per
Mcf.
F-39
<PAGE>
General and Administrative Overhead
The General Partner and its affiliates are reimbursed for actual general
and administrative costs incurred and attributable to the conduct of the
business affairs and operations of the Partnerships.
Use of Estimates in Financial Statements
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 and
disclosure of contingent 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 those estimates. Further,
accounts receivable (payable) - Net Profits includes accrued liabilities,
accrued lease operating expenses, and deferred lease operating expenses related
to gas balancing which involve estimates that could materially differ from the
actual amounts ultimately realized or incurred in the near term. Oil and gas
reserves (see Note 4) also involve significant estimates which could materially
differ from the actual amounts ultimately realized.
Income Taxes
Income or loss for income tax purposes is includable in the income tax
returns of the partners. Accordingly, no recognition has been given to income
taxes in these financial statements.
2. TRANSACTIONS WITH RELATED PARTIES
The Partnerships reimburse the General Partner for the general and
administrative overhead applicable to the Partnerships, based on an allocation
of actual costs incurred by the General Partner. When costs incurred benefit
other Partnerships and affiliates, the allocation of costs is based on the
relationship of the Partnerships' reserves to the total reserves owned by all
Partnerships and affiliates. The General Partner believes this allocation method
is reasonable. Although the actual costs incurred by the General Partner and its
affiliates have fluctuated during the three years presented, the amounts charged
to the Partnerships have not fluctuated due to expense limitations imposed by
the Partnership Agreement. The following is a summary of payments made to the
General Partner or its affiliates by the Partnerships for general and
administrative overhead costs for the years ended December 31, 1999, 1998, and
1997:
F-40
<PAGE>
Partnership 1999 1998 1997
----------- -------- -------- --------
P-1 $113,760 $113,760 $113,760
P-2 94,836 94,836 94,836
P-3 178,560 178,560 178,560
P-4 132,960 132,960 132,960
P-5 124,680 124,680 124,680
P-6 150,564 150,564 150,564
Affiliates of the Partnerships operate certain of the properties in which
the Partnerships own a Net Profits Interest and their policy is to bill the
owners of the working interests of such properties for all customary charges and
cost reimbursements associated with these activities, together with any
compressor rentals, consulting, or other services provided. Such charges are
comparable to third party charges in the area where the wells are located and
are the same as charged to other working interest owners in the wells.
3. MAJOR CUSTOMERS
The following table sets forth purchasers who individually accounted for
ten percent or more of combined oil and gas sales attributable to each of the
Partnership's Net Profits Interest during the years ended December 31, 1999,
1998, and 1997:
Percentage
-------------------------
Partnership Purchaser 1999 1998 1997
- ----------- ------------------------ ----- ----- -----
P-1 El Paso Energy Marketing
Company ("El Paso") 24.4% 31.7% 25.2%
Chevron U.S.A., Inc.
("Chevron") 12.0% 14.9% 10.8%
Texaco Exploration and
Production, Inc.
("Texaco") - 11.2% - %
P-2 El Paso 23.6% 30.7% 24.4%
Chevron 10.3% 13.0% - %
Texaco 10.1% 12.8% 11.1%
P-3 El Paso 23.4% 30.5% 24.2%
Texaco 10.1% 12.9% 11.2%
Chevron 10.1% 12.9% - %
F-41
<PAGE>
P-4 El Paso 28.7% 36.7% 49.1%
Valero Industrial
Gas LP 25.4% 29.1% 13.6%
Phibro Energy, Inc. 21.3% 16.1% 10.7%
P-5 El Paso 77.8% 73.1% 65.0%
P-6 El Paso 36.6% 32.5% 28.2%
HPL Resources Company 15.4% 16.8% 19.9%
Tejas Gas Marketing
Company 13.0% 14.0% 14.1%
In the event of interruption of purchases by one or more of these
significant customers or the cessation or material change in availability of
open access transportation by pipeline transporters, the Partnerships may
encounter difficulty in marketing their gas and in maintaining historic sales
levels. Alternative purchasers or transporters may not be readily available.
4. SUPPLEMENTAL OIL AND GAS INFORMATION
The following supplemental information regarding the Net Profits Interest
activities of the Partnerships is presented pursuant to the disclosure
requirements promulgated by the SEC.
Capitalized Costs
Capitalized costs and accumulated depletion at December 31, 1999 and 1998
were as follows:
P-1 Partnership
---------------
1999 1998
------------ ------------
Net Profits Interests in proved
oil and gas properties $6,888,884 $7,011,292
Less accumulated depletion
and valuation allowance ( 5,885,058) ( 5,846,399)
--------- ---------
Net Profits Interests, net $1,003,826 $1,164,893
========= =========
F-42
<PAGE>
P-2 Partnership
---------------
1999 1998
----------- ----------
Net Profits Interests in proved
oil and gas properties $ 5,557,749 $5,651,821
Less accumulated depletion
and valuation allowance ( 4,701,656) ( 4,650,323)
---------- ---------
Net Profits Interests, net $ 856,093 $1,001,498
========== =========
P-3 Partnership
---------------
1999 1998
------------- -------------
Net Profits Interests in proved
oil and gas properties $10,492,182 $10,640,125
Less accumulated depletion
and valuation allowance ( 8,896,546) ( 8,773,409)
---------- ----------
Net Profits Interests, net $ 1,595,636 $ 1,866,716
========== ==========
P-4 Partnership
---------------
1999 1998
----------- -----------
Net Profits Interests in proved
oil and gas properties $ 8,193,436 $8,198,995
Less accumulated depletion
and valuation allowance ( 7,300,777) ( 7,106,421)
---------- ---------
Net Profits Interests, net $ 892,659 $1,092,574
========== =========
F-43
<PAGE>
P-5 Partnership
---------------
1999 1998
---------- -----------
Net Profits Interests in proved
oil and gas properties $9,855,735 $9,840,394
Less accumulated depletion
and valuation allowance ( 9,018,764) ( 8,849,215)
---------- ---------
Net Profits Interest, net $ 836,971 $ 991,179
========== =========
P-6 Partnership
---------------
1999 1998
------------- -------------
Net Profits Interests in proved
oil and gas properties $12,024,877 $11,963,385
Less accumulated depletion
and valuation allowance ( 10,227,710) ( 9,897,539)
----------- ----------
Net Profits Interests, net $ 1,797,167 $ 2,065,846
========== ==========
Costs Incurred
The P-4 Partnership incurred $16,495 in property acquisition costs during
1997. No other property acquisition costs were incurred by the Partnerships
during the three years ended December 31, 1999. The following table sets forth
the development costs related to the working interests which are burdened by the
Partnerships' Net Profits Interests during the years ended December 31, 1999,
1998, and 1997. Since these acquisition and development costs were charged
against the Net Profits payable to the Partnerships, such costs were indirectly
borne by the Partnerships. No exploration costs were incurred during the same
periods.
Partnership 1999 1998 1997
----------- ------- ------- -------
P-1 $13,017 $34,624 $21,339
P-2 10,319 39,322 34,745
P-3 19,188 74,335 66,502
P-4 6,108 35,489 18,533
P-5 15,618 40,371 980
P-6 61,524 45,058 6,041
F-44
<PAGE>
Quantities of Proved Oil and Gas Reserves - Unaudited
The following tables summarize changes in net quantities of proved
reserves attributable to the Partnerships' Net Profits Interests, all of which
are located in the United States, for the periods indicated. The proved reserves
were estimated by petroleum engineers employed by affiliates of the
Partnerships. Certain reserve information was reviewed by Ryder Scott Company,
L.P., an independent petroleum engineering firm. The following information
includes certain gas balancing adjustments which cause the gas volumes to differ
from the reserve reports prepared by the General Partner and reviewed by Ryder
Scott.
P-1 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, December 31, 1996 251,262 2,701,360
Production (32,044) ( 357,516)
Sales of minerals in place (22,747) ( 234,580)
Extensions and discoveries 2,126 55,362
Revisions of previous estimates 18,069 118,867
--------- ---------
Proved reserves, December 31, 1997 216,666 2,283,493
Production (26,676) ( 321,426)
Sales of minerals in place (22,750) ( 140,306)
Extensions and discoveries 10,161 112,162
Revisions of previous estimates (14,628) 130,731
--------- ---------
Proved reserves, December 31, 1998 162,773 2,064,654
Production (24,737) ( 357,439)
Revisions of previous estimates 61,483 149,212
-------- ---------
Proved reserves, December 31, 1999 199,519 1,856,427
======== =========
PROVED DEVELOPED RESERVES:
December 31, 1997 214,498 2,256,381
======== =========
December 31, 1998 162,773 2,064,654
======== =========
December 31, 1999 199,519 1,856,427
======== =========
F-45
<PAGE>
P-2 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, December 31, 1996 185,693 2,448,132
Production ( 22,873) ( 301,132)
Sales of minerals in place ( 16,062) ( 231,921)
Extensions and discoveries 1,549 37,807
Revisions of previous estimates 12,015 89,714
------- ---------
Proved reserves, December 31, 1997 160,322 2,042,600
Production ( 18,652) ( 266,232)
Sales of minerals in place ( 15,519) ( 100,039)
Extensions and discoveries 8,088 106,181
Revisions of previous estimates ( 11,455) 93,581
------- ---------
Proved reserves, December 31, 1998 122,784 1,876,091
Production ( 17,583) ( 289,443)
Sales of minerals in place ( 100) ( 848)
Revisions of previous estimates 41,706 82,374
------- ---------
Proved reserves, December 31, 1999 146,807 1,668,174
======= =========
PROVED DEVELOPED RESERVES:
December 31, 1997 157,947 2,012,912
======= =========
December 31, 1998 122,784 1,876,091
======= =========
December 31, 1999 146,807 1,668,174
======= =========
F-46
<PAGE>
P-3 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, December 31, 1996 344,453 4,622,201
Production ( 42,259) ( 565,052)
Sales of minerals in place ( 30,066) ( 457,133)
Extensions and discoveries 2,854 69,751
Revisions of previous estimates 22,274 169,087
------- ---------
Proved reserves, December 31, 1997 297,256 3,838,854
Production ( 34,533) ( 496,649)
Sales of minerals in place ( 28,675) ( 186,034)
Extensions and discoveries 15,045 199,007
Revisions of previous estimates ( 21,424) 164,074
------- ---------
Proved reserves, December 31, 1998 227,669 3,519,252
Production ( 32,552) ( 543,312)
Sales of minerals in place ( 198) ( 1,664)
Revisions of previous estimates 77,079 160,004
------- ---------
Proved reserves, December 31, 1999 271,998 3,134,280
======= =========
PROVED DEVELOPED RESERVES:
December 31, 1997 292,782 3,782,929
======= =========
December 31, 1998 227,669 3,519,252
======= =========
December 31, 1999 271,998 3,134,280
======= =========
F-47
<PAGE>
P-4 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, December 31, 1996 75,797 3,123,119
Production ( 19,686) ( 513,815)
Sales of minerals in place ( 2,175) ( 315,220)
Revisions of previous estimates 1,898 365,764
------- ---------
Proved reserves, December 31, 1997 55,834 2,659,848
Production ( 16,783) ( 370,975)
Sales of minerals in place ( 93) ( 20,206)
Extensions and discoveries 5,038 119,211
Revisions of previous estimates 2,412 48,487
------- ---------
Proved reserves, December 31, 1998 46,408 2,436,365
Production ( 17,505) ( 338,882)
Revisions of previous estimates 31,120 10,747
------- ---------
Proved reserves, December 31, 1999 60,023 2,108,230
======= =========
PROVED DEVELOPED RESERVES:
December 31, 1997 49,163 2,549,052
======= =========
December 31, 1998 43,638 2,377,892
======= =========
December 31, 1999 57,546 2,079,090
======= =========
F-48
<PAGE>
P-5 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, December 31, 1996 51,531 3,261,422
Production ( 7,972) ( 516,756)
Sales of minerals in place ( 3,066) ( 61,493)
Revisions of previous estimates 10,735 346,293
------ ---------
Proved reserves, December 31, 1997 51,228 3,029,466
Production ( 6,315) ( 552,109)
Sales of minerals in place ( 4,850) ( 225,944)
Extensions and discoveries 232 226,515
Revisions of previous estimates ( 7,152) ( 151,902)
------ ---------
Proved reserves, December 31, 1998 33,143 2,326,026
Production ( 6,858) ( 464,917)
Revisions of previous estimates 13,488 474,570
------ ---------
Proved reserves, December 31, 1999 39,773 2,335,679
====== =========
PROVED DEVELOPED RESERVES:
December 31, 1997 51,175 3,024,146
====== =========
December 31, 1998 33,143 2,326,026
====== =========
December 31, 1999 39,773 2,335,679
====== =========
F-49
<PAGE>
P-6 Partnership
---------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- ------------
Proved reserves, December 31, 1996 140,380 5,483,120
Production ( 18,461) ( 984,971)
Sales of minerals in place ( 2,459) ( 75,335)
Extensions and discoveries 189 235
Revisions of previous estimates 4,088 540,454
------- ---------
Proved reserves, December 31, 1997 123,737 4,963,503
Production ( 19,139) ( 948,078)
Sales of minerals in place ( 3,749) ( 87,565)
Extensions and discoveries 251 244,230
Revisions of previous estimates ( 4,665) ( 100,354)
------- ---------
Proved reserves, December 31, 1998 96,435 4,071,736
Production ( 17,227) ( 909,561)
Extensions and discoveries 5,142 37,719
Revisions of previous estimates 18,395 679,868
------- ---------
Proved reserves, December 31, 1999 102,745 3,879,762
======= =========
PROVED DEVELOPED RESERVES:
December 31, 1997 123,718 4,961,677
======= =========
December 31, 1998 96,435 4,071,736
======= =========
December 31, 1999 102,745 3,879,762
======= =========
F-50
<PAGE>
Standardized Measure of Discounted Future Net Cash Flows of Proved Oil and
Gas Reserves - Unaudited
The following tables set forth the estimated future net cash flows as of
December 31, 1999 relating to the Partnerships' proved reserves attributable to
the Partnerships' Net Profits Interests based on the standardized measure as
prescribed in SFAS No. 69:
Partnership
-----------------------------------------------
P-1 P-2 P-3
------------ ------------ ------------
Future cash inflows $8,600,031 $7,062,789 $13,190,111
Future production and
development costs ( 2,123,132) ( 1,864,402) ( 3,500,361)
--------- --------- ----------
Future net cash flows $6,476,899 $5,198,387 $ 9,689,750
10% discount to
reflect timing
of cash flows ( 2,741,525) ( 2,218,180) ( 4,135,225)
--------- --------- ----------
Standardized measure
of discounted future
net cash flows $3,735,374 $2,980,207 $ 5,554,525
========= ========= ==========
Partnership
------------------------------------------------
P-4 P-5 P-6
------------ ------------ -------------
Future cash inflows $6,317,459 $5,834,094 $10,966,611
Future production and
development costs ( 1,837,908) ( 1,803,068) ( 4,017,120)
--------- --------- ----------
Future net cash flows $4,479,551 $4,031,026 $ 6,949,491
10% discount to
reflect timing
of cash flows ( 1,393,379) ( 1,243,938) ( 1,972,958)
--------- --------- ----------
Standardized measure
of discounted future
net cash flows $3,086,172 $2,787,088 $ 4,976,533
========= ========= ==========
F-51
<PAGE>
The process of estimating oil and gas reserves is complex, requiring significant
subjective decisions in the evaluation of available geological, engineering, and
economic data for each reservoir. The data for a given reservoir may change
substantially over time as a result of, among other things, additional
development activity, production history, and viability of production under
varying economic conditions; consequently, it is reasonably possible that
material revisions to existing reserve estimates may occur in the near future.
Although every reasonable effort has been made to ensure that the reserve
estimates reported herein represent the most accurate assessment possible, the
significance of the subjective decisions required and variances in available
data for various reservoirs make these estimates generally less precise than
other estimates presented in connection with financial statement disclosures.
The Partnerships' reserves were determined at December 31, 1999 using oil and
gas prices of approximately $22.75 per barrel and $2.24 per Mcf, respectively.
F-52
<PAGE>
INDEX TO EXHIBITS
-----------------
Number Description
- ------ -----------
4.1 The Certificate and Agreements of Limited Partnership for the
following Partnerships have been previously filed with the SEC as
Exhibit 2.1 to Form 8-A filed by each Partnership on the dates shown
below and are hereby incorporated by reference.
Partnership Filing Date File No.
----------- ----------------- --------
P-1 June 5, 1989 0-17800
P-2 June 5, 1989 0-17800
P-3 February 20, 1990 0-18306
P-4 February 20, 1990 0-18306
P-5 November 13, 1990 0-18637
P-6 November 30, 1990 0-18937
4.2 The Agreements of Partnership for the following NPI Partnerships
have been previously filed with the SEC as Exhibit 2.2 to Form 8A
filed by the related Partnerships on the dates shown below and are
hereby incorporated by reference.
Form 8-A
Partnership Filing Date
----------- -----------------
P-1 June 5, 1989
P-2 June 5, 1989
P-3 February 20, 1990
P-4 February 20, 1990
P-5 June 11, 1990
P-6 December 10, 1990
4.3 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income P-1 Limited Partnership, filed
as Exhibit 4.1 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
F-53
<PAGE>
4.4 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income P-2 Limited Partnership, filed
as Exhibit 4.2 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.5 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-3, filed
as Exhibit 4.3 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.6 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-4, filed
as Exhibit 4.4 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.7 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-5, filed
as Exhibit 4.5 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.8 Second Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-6, filed
as Exhibit 4.6 to Registrants' Current Report on Form 8-K dated
August 2, 1993 filed with the SEC on August 10, 1993 and is hereby
incorporated by reference.
4.9 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income P-1 Limited Partnership, filed
as Exhibit 4.10 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
4.10 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income P-2 Limited Partnership, filed
as Exhibit 4.11 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
F-54
<PAGE>
4.11 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-3, filed
as Exhibit 4.12 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
4.12 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-4, filed
as Exhibit 4.13 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
4.13 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-5, filed
as Exhibit 4.14 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
4.14 Third Amendment to Agreement of Limited Partnership of Geodyne
Institutional/Pension Energy Income Limited Partnership P-6, filed
as Exhibit 4.15 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1995 filed with the SEC on April 1, 1996 and
is hereby incorporated by reference.
*23.1 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income P-1 Limited Partnership.
*23.2 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income P-2 Limited Partnership.
*23.3 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income Limited Partnership P-3.
*23.4 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income Limited Partnership P-4.
*23.5 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income Limited Partnership P-5.
*23.6 Consent of Ryder Scott Company, Petroleum Engineers for the Geodyne
Institutional/Pension Energy Income Limited Partnership P-6.
F-55
<PAGE>
*27.1 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income P-1
Limited Partnership's financial statements as of December 31, 1999
and for the year ended December 31, 1999.
*27.2 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income P-2
Limited Partnership's financial statements as of December 31, 1999
and for the year ended December 31, 1999.
*27.3 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income
Limited Partnership P-3's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
*27.4 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income
Limited Partnership P-4's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
*27.5 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income
Limited Partnership P-5's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
*27.6 Financial Data Schedule containing summary financial information
extracted from the Geodyne Institutional/Pension Energy Income
Limited Partnership P-6's financial statements as of December 31,
1999 and for the year ended December 31, 1999.
All other Exhibits are omitted as inapplicable.
----------
* Filed herewith.
F-56
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income P-1 Limited Partnership.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income P-2 Limited Partnership.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income Limited Partnership P-3.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income Limited Partnership P-4.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income Limited Partnership P-5.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
RYDER SCOTT COMPANY
PETROLEUM CONSULTANTS Fax (713) 651-0849
1100 Louisiana Suite 3800 Houston, Texas 77002-5218 Telephone (713) 651-9191
CONSENT OF PETROLEUM ENGINEERING FIRM
We consent to the reference to our name included in this Annual Report on
Form 10-K for the year ended December 31, 1999 for Geodyne Institutional/Pension
Energy Income Limited Partnership P-6.
RYDER SCOTT COMPANY, L.P.
Houston, Texas
February 4, 2000
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000850427
<NAME> GEODYNE INST/PENS ENERGY INCOME P-1 LTD PSHP
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 182,743
<SECURITIES> 0
<RECEIVABLES> 167,901
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 350,644
<PP&E> 6,888,884
<DEPRECIATION> 5,885,058
<TOTAL-ASSETS> 1,354,470
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,354,470
<TOTAL-LIABILITY-AND-EQUITY> 1,354,470
<SALES> 802,539
<TOTAL-REVENUES> 807,876
<CGS> 0
<TOTAL-COSTS> 298,813
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 509,063
<INCOME-TAX> 0
<INCOME-CONTINUING> 509,063
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 509,063
<EPS-BASIC> 4.10
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000850428
<NAME> GEODYNE INST/PENS ENERGY INCOME P-2 LTD PSHP
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 148,106
<SECURITIES> 0
<RECEIVABLES> 135,136
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 283,242
<PP&E> 5,557,749
<DEPRECIATION> 4,701,656
<TOTAL-ASSETS> 1,139,335
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,139,335
<TOTAL-LIABILITY-AND-EQUITY> 1,139,335
<SALES> 618,890
<TOTAL-REVENUES> 623,131
<CGS> 0
<TOTAL-COSTS> 258,537
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 364,594
<INCOME-TAX> 0
<INCOME-CONTINUING> 364,594
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 364,594
<EPS-BASIC> 3.70
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000854066
<NAME> GEODYNE INST/PENS ENERGY INCOME LTD PSHP P-3
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 284,040
<SECURITIES> 0
<RECEIVABLES> 251,484
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 535,524
<PP&E> 10,492,182
<DEPRECIATION> 8,896,546
<TOTAL-ASSETS> 2,131,160
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,131,160
<TOTAL-LIABILITY-AND-EQUITY> 2,131,160
<SALES> 1,155,814
<TOTAL-REVENUES> 1,164,162
<CGS> 0
<TOTAL-COSTS> 483,628
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 680,534
<INCOME-TAX> 0
<INCOME-CONTINUING> 680,534
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 680,534
<EPS-BASIC> 3.75
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000860744
<NAME> GEODYNE INST/PENS ENERGY INCOME LTD PSHP P-4
<S> <C>
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