United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from...............to...............
Commission file number 0-18326
ENEX OIL & GAS INCOME PROGRAM IV - SERIES 6, L.P.
(Exact name of small business issuer as specified in its charter)
New Jersey 76-0251426
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 200, Three Kingwood Place
Kingwood, Texas 77339
(Address of principal executive offices)
Issuer's telephone number:
(713) 358-8401
Check whether the issuer (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes x No
Transitional Small Business Disclosure Format (Check one):
Yes No x
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM IV - SERIES 6, L.P.
BALANCE SHEET
- -------------------------------------------------------------------------------
September 30,
ASSETS 1996
--------------
(Unaudited)
CURRENT ASSETS:
<S> <C>
Cash $ 5,808
Accounts receivable - oil & gas sales 29,440
Other current assets 13,341
------------
Total current assets 48,589
------------
OIL & GAS PROPERTIES
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities 2,015,142
Less accumulated depreciation and depletion 1,875,843
------------
Property, net 139,299
------------
TOTAL $ 187,888
============
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to general partner $ 15,774
------------
PARTNERS' CAPITAL
Limited partners 153,838
General partner 18,276
------------
Total partners' capital 172,114
------------
TOTAL $ 187,888
============
Number of $500 Limited Partner units outstanding 4,326
</TABLE>
See accompanying notes to financial statements.
- -----------------------------------------------------------------------
I-1
<PAGE>
<TABLE>
<CAPTION>
ENEX OIL & GAS INCOME PROGRAM IV - SERIES 6, L.P.
STATEMENTS OF OPERATIONS
- -------------------------------------------------------------------------------------------------------------------
(UNAUDITED) QUARTER ENDED NINE MONTHS ENDED
-------------------------------------- ----------------------------------------
September 30, September 30, September 30, September 30,
1996 1995 1996 1995
----------------- ----------------- ----------------- -------------------
REVENUES:
<S> <C> <C> <C> <C>
Oil and gas sales $ 68,306 $ 45,393 $ 165,898 $ 140,864
----------------- ----------------- ----------------- -------------------
EXPENSES:
Depreciation and depletion 16,046 17,438 40,690 62,586
Lease operating expenses 13,713 13,459 43,659 52,864
Production taxes 4,323 2,670 10,296 7,773
General and administrative 4,148 4,130 14,516 12,868
----------------- ----------------- ----------------- -------------------
Total expenses 38,230 37,697 109,161 136,091
----------------- ----------------- ----------------- -------------------
NET INCOME $ 30,076 $ 7,696 $ 56,737 $ 4,773
================= =============== ================= ===================
</TABLE>
See accompanying notes to financial statements.
- ---------------------------------------------------------------------------
I-2
<TABLE>
<CAPTION>
<PAGE>
ENEX OIL AND GAS INCOME PROGRAM IV - SERIES 6, L.P.
STATEMENTS OF CASH FLOWS
- ---------------------------------------------------------------------------------------------------
(UNAUDITED)
NINE MONTHS ENDED
--------------------------------------------
September 30, September 30,
1996 1995
------------------- -------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income (loss) $ 56,737 $ 4,773
------------------- -------------------
Adjustments to reconcile net income (loss)
to net cash provided by operating
activities:
Depreciation and depletion 40,690 62,586
(Increase) decrease in:
Accounts receivable - oil & gas sales (6,924) 4,663
Other current asset (12,146) (1,195)
(Decrease) in:
Accounts payable (5,692) (7,510)
Payable to general partner (38,560) (42,979)
------------------- -------------------
Total adjustments (22,632) 15,565
------------------- -------------------
Net cash provided by operating activities 34,105 20,338
------------------- -------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property (additions) credits - development costs (9,004) 3,866
------------------- -------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions (35,878) (25,349)
------------------- -------------------
NET (DECREASE) IN CASH (10,777) (1,145)
CASH AT BEGINNING OF YEAR 16,585 3,317
------------------- -------------------
CASH AT END OF PERIOD $ 5,808 $ 2,172
=================== ===================
</TABLE>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------
I-3
<PAGE>
ENEX OIL & GAS INCOME PROGRAM IV - SERIES 6, L.P.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
1. The interim financial information included herein is unaudited;
however, such information reflects all adjustments (consisting solely
of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of results for the
interim periods.
2. A cash distribution was made to the limited partners of the Company in
the amount of $10,029 representing net revenues from the sale of oil
and gas produced from properties owned by the Company. This
distribution was made on July 31, 1996.
3. On August 9, 1996, the Company's General Partner submitted preliminary
proxy material to the Securities Exchange Commission with respect to a
proposed consolidation of the Company with 33 other managed limited
partnerships. On November 13, 1996, the Company submitted amended
preliminary proxy material to the SEC with respect to this consolidation
The terms and conditions of the proposed consolidation are set forth in
such preliminary proxy material.
I-4
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
Third Quarter 1995 Compared to Third Quarter 1996
Oil and gas sales for the third quarter increased to $68,306 in 1996 from
$45,393 in 1995. This represents an increase of $22,913 (50%). Oil sales
increased by $12,882 or 50%. A 14% increase in oil production increased sales by
$3,515. A 33% increase in the average oil sales price increased sales by $9,367.
Gas sales increased by $10,031 (50%). An 11% increase in gas production
increased sales by $2,355. A 34% increase in the average gas sales price
increased sales by an additional $7,676. The increases in oil and gas production
were primarily due to increased production from the Speary acquisition on which
a compressor was reworked. The increases in the average oil and gas sales prices
correspond with higher prices in the overall market for the sale of oil and gas.
Lease operating expenses increased to $13,713 in the third quarter of 1996 from
$13,459 in the third quarter of 1995. The increase of $254 (2%) is primarily due
to the changes in production, noted above.
Depreciation and depletion expense decreased to $16,046 in the third quarter of
1996 from $17,438 in the third quarter of 1995. This represents a decrease of
$1,392 (8%). An 18% decrease in the depletion rate reduced depreciation and
depletion by $3,565. This decrease was partially offset by the changes in
production, noted above. The rate decrease is primarily due to an upward
revision of the oil and gas reserves in December 1995.
General and administrative expenses increased to $4,148 in 1996 from $4,130 in
1995. This increase of $18 is primarily due to more staff time being required to
manage the Company's operations.
First Nine Months in 1995 Compared to First Nine Months in 1996
Oil, gas and gas sales for the first nine months increased to $165,898 in 1996
from $140,864 in 1995. This represents an increase of $25,034 (18%). Oil sales
increased by $9,825 or 12%. A 19% increase in the average oil sales price
increased sales by $13,744. This increase was partially offset by a 5% decrease
in oil production. Gas sales increased by $23,302 (42%). A 5% increase in gas
production increased sales by $3,040. A 35% increase in the average gas sales
price increased sales by an additional $20,262. Sales of plant product decreased
by $8,093 or 100%. The Kalkaska gas plant was shut-in and did not produce in
1996. In the second quarter of 1995, gas plant production was unusually high due
to the recognition of back revenues from the Kalkaska gas plant. The decrease in
oil production was primarily due to natural production declines. The increase in
gas production was primarily due to increased production from the Speary
acquisition on which a compressor was reworked. The increase in the average oil
sales price corresponds with higher prices in the overall market for the sale of
oil. The higher
I-5
<PAGE>
average gas sales price was primarily the result of relatively higher production
from the Speary acquisition, which has a relatively higher gas sales price,
coupled with higher prices in the overall market for the sale of gas.
Lease operating expenses decreased to $43,659 in the first nine months of 1996
from $52,864 in the first nine months of 1995. The decrease of $9,205 (17%) is
primarily due to the changes in production, noted above.
Depreciation and depletion expense decreased to $40,690 in the first nine months
of 1996 from $62,586 in the first nine months of 1995. This represents a
decrease of $21,896 (35%). The changes in production, noted above, reduced
depreciation and depletion expense by $8,401. A 25% decrease in the depletion
rate reduced depreciation and depletion expense by an additional $13,495. This
rate decrease is primarily due to an upward revision of the oil and gas reserves
during December 1995.
General and administrative expenses increased to $14,516 in the first nine
months of 1996 from $12,868 in the first nine months of 1995. This increase of
$1,648 (13%) is primarily due to more staff time being required to manage the
Company's operations.
CAPITAL RESOURCES AND LIQUIDITY
The Company's cash flow from operations is a direct result of the amount of net
proceeds realized from the sale of oil and gas production. Accordingly, the
changes in cash flow from 1995 to 1996 are primarily due to the changes in oil
and gas sales described above. It is the general partner's intention to
distribute substantially all of the Company's available cash flow to the
Company's partners. The Company's "available cash flow" is essentially equal to
the net amount of cash provided by operating activities.
The Company will continue to recover its reserves and distribute to the limited
partners the net proceeds realized from the sale of oil and gas production.
Distribution amounts are subject to change if net revenues are greater or less
than expected. Nonetheless, the general partner believes the Company will
continue to have sufficient cash flow to fund operations and to maintain a
regular pattern of distributions.
On August 9, 1996, the Company's General Partner submitted preliminary proxy
material to the Securities Exchange Commission with respect to a proposed
consolidation of the Company with 33 other managed limited partnerships. On
November 13, 1996, the Company submitted amended preliminary proxy material to
the SEC with respect to this consolidation. The terms and conditions of the
proposed consolidation are set forth in such preliminary proxy material.
As of September 30, 1996, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
I-6
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
None
Item 3. Defaults Upon Senior Securities.
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders.
Not Applicable
Item 5. Other Information.
Not Applicable
Item 6. Exhibits and Reports on Form 8-K.
(a) There are no exhibits to this report.
(b) The Company filed no reports on Form 8-K during the
quarter ended September 30, 1996.
II-1
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
ENEX OIL & GAS INCOME
PROGRAM IV - SERIES 6, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By: /s/ R. E. Densford
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
November 13, 1996 By: /s/ James A. Klein
-------------------
James A. Klein
Controller and Chief
Accounting Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<CIK> 0000861067
<NAME> Enex Oil & Gas Income Program IV-Series 6,L.P.
<S> <C>
<PERIOD-TYPE> 9-mos
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-START> jan-01-1996
<PERIOD-END> sep-30-1996
<CASH> 5808
<SECURITIES> 0
<RECEIVABLES> 29440
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 48589
<PP&E> 2015142
<DEPRECIATION> 1875843
<TOTAL-ASSETS> 187888
<CURRENT-LIABILITIES> 15774
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 172114
<TOTAL-LIABILITY-AND-EQUITY> 187888
<SALES> 165898
<TOTAL-REVENUES> 165898
<CGS> 53955
<TOTAL-COSTS> 109161
<OTHER-EXPENSES> 55206
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 56737
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
