HS RESOURCES INC, 424B1, 1997-10-10

HS RESOURCES INC
424B1, 1997-10-10
CRUDE PETROLEUM & NATURAL GAS

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<PAGE> 1
Filed Pursuant to Rule 424(b)(1)
Registration No. 333-28825

PROSPECTUS SUPPLEMENT
(To Prospectus dated June 20, 1997)

1,850,010 Shares

HS RESOURCES, INC.

Common Stock

---------------------------

All of the shares of Common Stock, par value $0.001 per share (the
"Common Stock"), of HS Resources, Inc. (the "Company" or "HSR") offered hereby
(the "Offering") are being sold by the Selling Stockholder identified herein.
See "Selling Stockholder." The Company will not receive any proceeds from the
sale of the Common Stock by the Selling Stockholder.

The Common Stock is traded on The New York Stock Exchange, Inc. (the
"NYSE") under the trading symbol "HSE." The last reported sale price of the
Common Stock on the NYSE on October 9, 1997 was $17 7/8 per share.

---------------------------

FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION
WITH AN INVESTMENT IN THE COMMON STOCK, SEE "RISK FACTORS" BEGINNING ON PAGE 6
OF THE ACCOMPANYING PROSPECTUS.

---------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
=====================================================================================================================
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO SELLING
PUBLIC COMMISSIONS(1) STOCKHOLDER(2)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share......................... $17.75 $0.88 $16.87
- ---------------------------------------------------------------------------------------------------------------------
Total............................. $32,837,678 $1,628,009 $31,209,669
=====================================================================================================================
</TABLE>

(1) The Company and the Selling Stockholder have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). See
"Underwriting."

(2) Expenses of the Offering, estimated to be approximately $250,000, are
payable by the Company. Under certain circumstances, the Selling Stockholder
has agreed to pay certain of the Company's expenses incurred in connection
with the Offering.
---------------------------

The shares of Common Stock offered by this Prospectus Supplement are
offered by the several Underwriters subject to prior sale, to withdrawal,
cancellation or modification of the offer without notice, to delivery to and
acceptance by the Underwriters and to certain further conditions. It is expected
that delivery of the shares will be made at the offices of Lehman Brothers Inc.,
in New York, New York on or about October 16, 1997.

---------------------------

LEHMAN BROTHERS
MERRILL LYNCH & CO.

PETRIE PARKMAN & CO.

October 9, 1997
<PAGE> 2

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This Prospectus Supplement and the accompanying Prospectus include and
incorporate by reference statements that are not purely historical and are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), including statements regarding the Company's expectations,
hopes, beliefs, intentions or strategies regarding the future. All statements
other than statements of historical facts included herein or in the accompanying
Prospectus or incorporated by reference in the accompanying Prospectus,
including without limitation, statements made herein under "Business and
Properties" and statements made in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996 or Quarterly Reports on Form 10-Q for
the quarters ended March 31, 1997 and June 30, 1997 under "Business,"
"Properties," "Legal Proceedings and Environmental Issues" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
regarding reserves and their values, planned capital expenditures, increases in
oil and natural gas production, trends or expectations concerning oil and gas
prices, the number and prospective nature of anticipated wells to be drilled in
1997 and thereafter, development potential, refrac potential, infill potential,
drillsite potential, exploitation and exploration prospects and leads, drilling
prospects, acquisition and consolidation opportunities, divestiture
opportunities and the Company's financial position, business strategy and other
plans and objectives for future operations, potential liabilities or the
expected absence thereof, the potential outcome of environmental matters,
litigation and other proceedings are forward-looking statements. All
forward-looking statements included herein or in the accompanying Prospectus or
incorporated by reference in the accompanying Prospectus are based on
information available to the Company on the date hereof, or, with respect to
documents incorporated by reference, on the date thereof, and the Company
assumes no obligation to update such forward-looking statements. Although the
Company believes that the assumptions and expectations reflected in such
forward-looking statements are reasonable, it can give no assurance that such
expectations will prove to have been correct or that the Company will take any
actions that may presently be planned. There are numerous uncertainties inherent
in estimating quantities of proved oil and natural gas reserves and projecting
future rates of production and timing of development expenditures, including
many factors beyond the control of the Company.

Many factors may affect the Company's expectations and plans. Capital
expenditure and financing plans may change in connection with the success of
drilling activities, the general availability of capital, interest rates, and
cash flow available from operations. Cash flow available from operations may
change depending on costs of materials and services, regulatory burdens and
commodity prices. Oil and natural gas prices are volatile, and there are several
potentially significant adverse effects to the Company that can result if
product prices decline materially. First, lower product prices will adversely
impact the Company's cash flow and could cause the Company to (i) curtail its
capital program, (ii) borrow additional amounts under its revolving credit
agreement, or (iii) issue additional debt or equity securities. Second, lower
product prices could cause the borrowing base under the Company's bank credit
agreement to be reduced and certain covenant tests to be adversely affected.
Third, under rules promulgated by the Securities and Exchange Commission,
companies that follow the full cost accounting method are required to make
quarterly "ceiling test" calculations. Lower product prices adversely impact the
ceiling calculation. Should the Company realize sustained lower product prices,
it could be required to write down its oil and gas properties, resulting in a
non-cash charge against earnings.

Certain additional important factors that could cause actual results to
differ materially from the Company's forward-looking statements are disclosed
under "Risk Factors" in the accompanying Prospectus and under "Business,"
"Properties," "Legal Proceedings and Environmental Issues," "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
elsewhere in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996 and Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1997 and June 30, 1997, and in the Company's Current Report on Form
8-K filed February 26, 1997, each of which is incorporated by reference in the
accompanying Prospectus. All subsequent written or oral forward-looking
statements attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by such factors.

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK. SUCH
TRANSACTIONS MAY INCLUDE THE PURCHASE OF SHARES OF COMMON STOCK PRIOR TO THE
PRICING OF THIS OFFERING FOR THE PURPOSE OF MAINTAINING THE PRICE OF THE COMMON
STOCK AND THE PURCHASE OF SHARES OF COMMON STOCK FOLLOWING THE PRICING OF THIS
OFFERING TO COVER A SYNDICATE SHORT POSITION IN THE COMMON STOCK OR FOR THE
PURPOSE OF MAINTAINING THE PRICE OF THE COMMON STOCK. FOR A DESCRIPTION OF THESE
ACTIVITIES, SEE "UNDERWRITING."

S-2
<PAGE> 3

PROSPECTUS SUPPLEMENT SUMMARY

The information in this Prospectus Supplement is qualified in its entirety
by the more detailed information and consolidated financial statements and notes
thereto appearing or incorporated by reference in the accompanying Prospectus.
In determining whether to purchase the shares of Common Stock being offered
hereby, prospective investors should consider carefully the information
contained in this Prospectus Supplement and the accompanying Prospectus and the
information incorporated by reference therein. See "Risk Factors" in the
accompanying Prospectus. Certain terms relating to the oil and gas industry are
defined in "Certain Definitions" in the Company's Annual Report on Form 10-K for
the year ended December 31, 1996, which is incorporated by reference in the
accompanying Prospectus. Unless the context otherwise requires, references to
"HSR" or the "Company" in this Prospectus Supplement and the accompanying
Prospectus include HS Resources, Inc. and its subsidiaries.

THE COMPANY

HS Resources, Inc. is a leading U.S. independent energy company engaged in
the development, acquisition, exploitation, exploration, production and
marketing of oil and gas. Pursuant to its value-oriented growth strategy, the
Company's experienced management and technical staff have consistently increased
reserves, production and net cash flow (as defined herein), both on an absolute
and per share basis. Over the past four years the Company has achieved compound
annual growth rates of 34%, 40% and 36% in reserves, production and net cash
flow, respectively. Reflecting the Company's focus on per share growth as a
measure of performance, over the same period HSR's reserves and production,
expressed in equivalent barrels per share, have increased at a compound annual
growth rate of 15.4% and 14.8%, respectively.

HSR has created a diversified asset base in four core geographic areas: the
Denver-Julesburg ("D-J") Basin, the Mid-Continent, the on-shore area of the
Texas-Louisiana Gulf Coast and the Northern Rocky Mountains. In the D-J Basin,
the Company has established a substantial production base as a result of its
successful execution of a large scale development drilling program and focused
acquisitions, primarily in the Wattenberg Field area. Its Mid-Continent
presence, which is focused in the Anadarko and Arkoma Basins, was established
through the Company's 1996 merger with Tide West Oil Company and enhanced by
exploration and production activities. In the Gulf Coast, the Company initiated
an active exploration program assembling approximately 300,000 gross acres under
its control and acquiring 270 square miles of 3-D seismic data (with an
additional 260 square miles to be acquired within the next six months). In the
Northern Rocky Mountains, the Company has assembled a 614,000 acre position,
primarily in the Williston and Greater Green River Basins. In these four core
areas, HSR has in its inventory in excess of 2,000 exploitation and exploration
opportunities, along with over 1.2 million gross undeveloped acres. The
exploitation opportunities include development and infill drilling,
refracturing, recompletion and wellbore deepening projects. The Company believes
that each of its four core geographic areas presents opportunities for growth in
reserves, production and cash flow.

At December 31, 1996, the Company reported proved reserves of 142.0 MMBoe,
with an estimated pre-tax present value (discounted at 10%) of $1.13 billion.
Natural gas constituted approximately 76% of the Company's reserves.
Approximately 76% of the Company's proved reserves were classified as developed.
At December 31, 1996, the Company operated approximately 74% of its 3,562 wells.
During the twelve months ended December 31, 1996 and the six months ended June
30, 1997, the Company generated net cash flow of $56.5 million and $34.2
million, respectively, with average production of 20.9 MBoe and 24.9 MBoe per
day, respectively.

See "Risk Factors" in the accompanying Prospectus for a discussion of
certain factors that should be considered in connection with an investment in
the Common Stock offered hereby.
S-3
<PAGE> 4

THE OFFERING

<TABLE>
<S> <C>
Common Stock Offered by the Selling
Stockholder................................ 1,850,010 shares
Common Stock Outstanding(1).................. 17,279,255 shares
Use of Proceeds.............................. All proceeds from the Offering will be
received by the Selling Stockholder.
New York Stock Exchange Symbol............... HSE
</TABLE>

- ---------------

(1) Excludes 878,570 shares of Common Stock issuable upon exercise of options
and warrants outstanding as of September 30, 1997.

SELLING STOCKHOLDER

Natural Gas Partners, L.P. (the "Selling Stockholder") has been an investor
in the Company since 1990 and became a major stockholder as a result of the 1996
merger of Tide West Oil Company into the Company (the "Merger"). The Selling
Stockholder is liquidating a portion of its holdings in the Company in
accordance with its obligation to its limited partner under the termination
provisions of the Selling Stockholder's limited partnership agreement. The
remaining shares of Common Stock held by the Selling Stockholder will be
distributed to the general partner of the Selling Stockholder and its partners,
who have notified the Company of their present intent to continue to hold the
shares for investment purposes.
S-4
<PAGE> 5

SUMMARY FINANCIAL DATA

The following table presents summary financial data for the Company as of
the dates and for the periods indicated. The financial data for the years ended
December 31, 1992, 1993, 1994, 1995 and 1996, were derived from the audited
consolidated financial statements of the Company. The financial data for the six
months ended June 30, 1996 and 1997, have been derived from the Company's
unaudited consolidated financial statements. The summary historical financial
data are qualified in their entirety by, and should be read in conjunction with,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the Consolidated Financial Statements and the related notes
thereto, incorporated by reference in the accompanying Prospectus. For
additional information relating to the Company's operations, see "Business and
Properties."

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
---------------------------------------------------- -------------------
1992 1993 1994 1995 1996 1996 1997
-------- -------- -------- -------- -------- -------- --------
(IN THOUSANDS, EXCEPT PER SHARE INFORMATION) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Oil and natural gas sales........ $ 25,950 $ 45,382 $ 58,827 $ 53,394 $107,281 $ 34,962 $ 66,122
Trading and transportation....... -- -- -- -- 46,373 4,853 56,391
Other revenues................... 1,683 2,095 1,574 1,946 3,302 1,209 2,811
-------- -------- -------- -------- -------- -------- --------
Total revenues............ 27,633 47,477 60,401 55,340 156,956 41,024 125,324
-------- -------- -------- -------- -------- -------- --------
Production taxes................. 2,493 4,222 5,134 4,050 8,195 2,690 4,834
Lease operating expenses......... 2,831 5,470 8,310 9,936 17,692 5,937 12,371
Cost of trading and
transportation................. -- -- -- -- 45,699 4,733 55,465
Depreciation, depletion and
amortization................... 8,829 15,299 25,079 26,609 42,335 15,192 25,316
General and administrative
expenses....................... 1,874 3,123 4,228 4,076 5,642 1,762 3,031
Interest expense................. 4,039 3,118 7,539 10,219 22,936 7,744 15,376
-------- -------- -------- -------- -------- -------- --------
Total expenses............ 20,066 31,232 50,290 54,890 142,499 38,058 116,393
-------- -------- -------- -------- -------- -------- --------
Income before provision for
income taxes and extraordinary
item........................... 7,567 16,245 10,111 450 14,457 2,966 8,931
Provision for income taxes....... 2,883 6,189 3,852 176 5,508 1,130 3,403
Extraordinary item, net of tax... 994 -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Net income....................... $ 3,690 $ 10,056 $ 6,259 $ 274 $ 8,949 $ 1,836 $ 5,528
======== ======== ======== ======== ======== ======== ========
Net income per share, assuming
full dilution.................. $ 0.55 $ 0.92 $ 0.53 $ 0.02 $ 0.61 $ 0.16 $ 0.32
======== ======== ======== ======== ======== ======== ========
Weighted average number of shares
outstanding, assuming full
dilution....................... 6,747 10,938 11,724 11,450 14,769 11,604 17,535
-------- -------- -------- -------- -------- -------- --------
BALANCE SHEET DATA (END OF PERIOD):
Working capital (deficiency)..... $ 3,606 $ 16,221 $ (2,384) $(16,115) $ 13,749 $ (7,688) $ (9,280)
Oil and gas properties, net...... 102,517 184,188 242,009 278,811 652,180 667,573 636,553
Total assets..................... 120,452 228,260 269,070 302,089 731,285 730,166 722,944
Long-term debt, net of current
portion........................ 20,640 74,420 103,478 125,537 398,563 399,800 353,222
Deferred income taxes............ 9,868 19,589 23,432 23,604 84,829 80,819 88,231
Stockholders' equity............. 78,731 113,299 119,358 119,174 192,724 185,462 197,770
OTHER FINANCIAL DATA:
Net cash provided by (used in)
operating activities........... $ 20,469 $ 33,745 $ 36,553 $ 31,179 $ 52,251 $(17,777) $ 43,735
Net cash flow(1)................. 16,396 31,544 35,190 27,059 56,492 18,158 34,246
Capital expenditures(2).......... 43,968 59,202 72,169 33,529 41,029 31,039 40,588
EBITDA(3)........................ 20,436 34,662 42,729 37,278 79,428 25,902 49,623
</TABLE>

- ---------------

(1) Net cash flow is defined as net income plus depreciation, depletion and
amortization, deferred taxes and extraordinary items. Net cash flow is not a
generally accepted accounting principal measure, should not be construed as
an alternative to net cash provided by operating activities, and is
presented solely as a supplemental disclosure.

(2) Capital expenditures exclude acquisition costs of $1,384,000, $34,697,000,
$14,044,000, $29,357,000 and $374,041,000 for the years ended December 31,
1992, 1993, 1994, 1995 and 1996, respectively, and $372,783,000 and
$1,918,000 for the six months ended June 30, 1996 and 1997, respectively.

(3) EBITDA, or "earnings before interest, income taxes, extraordinary items,
depreciation and amortization," reflects income from operations plus
depreciation, depletion and amortization, impairment of proved oil and gas
properties, non-recurring costs and exploration expense. EBITDA is not a
generally accepted accounting principle measure, but provides supplemental
information for evaluating the Company's ability to make payments in respect
of its indebtedness. It should not be construed as an alternative to income
from operations, net income or cash flow from operations and is presented
solely as a supplemental disclosure.
S-5
<PAGE> 6

SUMMARY OPERATING AND RESERVE DATA

The following table presents summary operating data and estimated net
proved reserves as of the dates and for the periods indicated. For additional
information relating to the Company's estimated net oil and natural gas reserves
and operating data, see "Business and Properties," "Management's Discussion and
Analysis of Financial Condition and Results of Operations," and Notes to
Consolidated Financial Statements appearing herein or incorporated by reference
in the accompanying Prospectus.

<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED DECEMBER 31, ENDED JUNE 30,
------------------------------------------------------ ----------------
1992 1993 1994 1995 1996 1996 1997
-------- -------- -------- -------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
NET PRODUCTION DATA:
Oil (MBbls).............. 539 967 1,664 1,582 1,923 766 1,167
Natural gas (MMcf)....... 8,770 14,684 20,108 21,049 34,163 12,054 20,031
Total (MBoe)............. 2,000 3,414 5,015 5,090 7,617 2,775 4,505
Average Sales Prices:
Oil (per Bbl)............ $ 19.16 $ 16.09 $ 14.83 $ 16.52 $ 20.90 $19.78 $ 20.37
Natural gas (per Mcf).... 1.78 2.03 1.70 1.30 1.96 1.64 2.11
EXPENSE DATA PER BOE:
Lease operating expense.... $ 1.42 $ 1.60 $ 1.66 $ 1.95 $ 2.32 $ 2.14 $ 2.75
Production taxes........... 1.25 1.24 1.02 0.80 1.08 0.97 1.07
General and administrative
expense.................. 0.94 0.91 0.84 0.80 0.74 0.64 0.67
RESERVE DATA:
Net proved reserves(1)(2)
Oil (MBbls).............. 11,358 16,300 18,301 19,588 34,614 -- --
Natural gas (MMcf)....... 198,278 252,413 265,278 298,777 644,421 -- --
Total (MBoe)............. 44,405 58,369 62,514 69,384 142,018 -- --
Present value(1)(2)(3)... $173,970 $210,537 $230,331 $257,045 $1,130,923 -- --
</TABLE>

- ---------------

(1) As of December 31, 1996, the average year-end prices used for purposes of
estimating the Company's net proved reserves, the future net revenues
therefrom and the present value of such net revenues were $3.39 per Mcf of
natural gas and $24.92 per Bbl of oil. See "Risk Factors -- Volatility of
Oil and Natural Gas Prices; Marketability of Production" and "-- Estimation
of Reserves" in the accompanying Prospectus and "Properties -- Oil and Gas
Reserves" and Note 15 to Consolidated Financial Statements incorporated by
reference in the accompanying Prospectus.

(2) Two independent petroleum engineering consulting firms were engaged to
review the Company's estimates of its proved reserves as of December 31,
1996. Williamson Petroleum Consultants, Inc. reviewed HSR's D-J Basin,
Northern Rocky Mountain and Gulf Coast properties, and Netherland, Sewell &
Associates, Inc. reviewed the Company's Mid-Continent reserves. Such
estimates were based upon a review of production histories and other
geologic, economic, ownership and engineering data provided by or available
to the Company. In the aggregate, 78.4% of the value of the Company's
proved reserves were reviewed by the two engineering firms. See "Risk
Factors -- Estimation of Reserves" in the accompanying Prospectus.

(3) Present value is defined as the present value of estimated future net
revenues before income taxes, discounted by a factor of 10% per annum, and
with no price or cost escalation or de-escalation in accordance with
guidelines promulgated by the Securities and Exchange Commission.
S-6
<PAGE> 7

USE OF PROCEEDS

The Company will not receive any of the proceeds from the Offering. All of
such proceeds will be received by the Selling Stockholder.

CAPITALIZATION

The following table sets forth the capitalization of the Company as of June
30, 1997. This table should be read in conjunction with "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the Company's
Consolidated Financial Statements and the notes thereto incorporated by
reference in the accompanying Prospectus.

<TABLE>
<CAPTION>
AS OF
JUNE 30,
1997
--------------
(UNAUDITED)
(IN THOUSANDS)
<S> <C>
Current portion of long-term debt........................... $ 24,439
--------
Long-term debt (excluding current portion).................. 353,222
--------
Stockholders' equity:
Preferred Stock, $.001 par value, 15,000,000 shares
authorized; no shares issued and outstanding.............. --
Common Stock, $.001 par value, 30,000,000 shares authorized;
17,138,564 shares issued and outstanding.................. 17
Additional paid-in capital.................................. 163,140
Retained earnings........................................... 36,962
Deferred compensation....................................... (180)
Treasury Stock, at cost, 160,358 shares..................... (2,169)
--------
Total stockholders' equity........................ 197,770
--------
Total capitalization.............................. $575,431
========
</TABLE>

S-7
<PAGE> 8

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

The Common Stock is listed on the NYSE under the symbol "HSE." The
following table sets forth, for the periods indicated, the high and low sales
price per share for the Common Stock.

<TABLE>
<CAPTION>
HIGH LOW
----- ------
<S> <C> <C>
1995
First Quarter............................................. $ 17 1/2 $ 13 3/4
Second Quarter............................................ 16 7/8 13 3/4
Third Quarter............................................. 15 1/8 13 1/8
Fourth Quarter............................................ 14 7/8 12 5/8
1996
First Quarter............................................. $ 13 1/8 $ 9 1/4
Second Quarter............................................ 13 1/4 10 3/8
Third Quarter............................................. 14 1/8 11 3/4
Fourth Quarter............................................ 17 5/8 12 7/8
1997
First Quarter............................................. $ 18 3/8 $ 11 1/2
Second Quarter............................................ 15 10 7/8
Third Quarter............................................. 17 7/8 13 3/16
Fourth Quarter (through October 9, 1997).................. 18 9/16 16 5/8
</TABLE>

On October 9, 1997, the last reported sales price on the NYSE was $17 7/8
per share. As of September 30, 1997, there were approximately 436 holders of
record of the Common Stock.

The Company has never paid any cash dividends on the Common Stock, and the
Board of Directors of the Company does not currently intend to declare cash
dividends on the Common Stock. The Company instead intends to retain its
earnings to support the growth of the Company's business. Any future cash
dividends would depend on future earnings, capital requirements and the
Company's financial condition and other factors deemed relevant by the Board of
Directors. The Company's credit facility currently prohibits payment of
dividends, and the indentures governing the Company's outstanding 9 1/4% and
9 7/8% senior subordinated notes due in 2006 and 2003, respectively, also limit
the Company's ability to pay dividends.

S-8
<PAGE> 9

BUSINESS AND PROPERTIES

THE COMPANY

HS Resources, Inc. is a leading U.S. independent energy company engaged in
the development, acquisition, exploitation, exploration, production and
marketing of oil and gas. Pursuant to its value-oriented growth strategy, the
Company's experienced management and technical staff have consistently increased
reserves, production and net cash flow, both on an absolute and per share basis.
Over the past four years the Company has achieved compound annual growth rates
of 34%, 40% and 36% in reserves, production and net cash flow, respectively.
Reflecting the Company's focus on per share growth as a measure of performance,
over the same period HSR's reserves and production, expressed in equivalent
barrels per share, have increased at a compound annual growth rate of 15.4% and
14.8%, respectively.

HSR has created a diversified asset base in four core geographic areas: the
D-J Basin, the Mid-Continent, the on-shore area of the Texas-Louisiana Gulf
Coast and the Northern Rocky Mountains. In the D-J Basin, the Company has
established a substantial production base as a result of its successful
execution of a large scale development drilling program and focused
acquisitions, primarily in the Wattenberg Field area. Its Mid-Continent
presence, which is focused in the Anadarko and Arkoma Basins, was established
through the Company's 1996 merger with Tide West Oil Company and enhanced by
exploration and production activities. In the Gulf Coast, the Company initiated
an active exploration program assembling approximately 300,000 gross acres under
its control and acquiring 270 square miles of 3-D seismic data (with an
additional 260 square miles to be acquired within the next six months). In the
Northern Rocky Mountains, the Company has assembled a 614,000 acre position,
primarily in the Williston and Greater Green River Basins. In these four core
areas, HSR has in its inventory in excess of 2,000 exploitation and exploration
opportunities, along with over 1.2 million gross undeveloped acres. The
exploitation opportunities include development and infill drilling,
refracturing, recompletion and wellbore deepening projects. The Company believes
that each of its four core geographic areas presents opportunities for growth in
reserves, production and cash flow.

The following tables summarize the Company's reserves at December 31, 1996,
its undeveloped acreage and production as of and for the six months ended June
30, 1997, and its product mix as a percentage of revenues for the six months
ended June 30, 1997.

<TABLE>
<CAPTION>
RESERVES PRODUCTION
AT DECEMBER 31, 1996 -----------------------
---------------------------------------- GROSS SIX MONTHS ENDED
OIL UNDEVELOPED JUNE 30, 1997
OIL GAS EQUIVALENT ACREAGE AT -----------------------
(MBBLS) (MMCF) (MBOE) % TOTAL JUNE 30, 1997 TOTAL (MBOE) % TOTAL
------- ------- ---------- ------- ------------- ------------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
D-J Basin..................... 27,902 415,067 97,080 68.4% 269,363 2,914 64.7%
Mid-Continent................. 6,555 225,442 44,128 31.1 34,314 1,579 35.0
Gulf Coast.................... 24 75 37 0.0 299,441 12 0.3
Northern Rocky Mountains...... 133 3,837 773 0.5 613,913 -- --
------ ------- ------- ----- --------- ----- -----
Total..................... 34,614 644,421 142,018 100.0% 1,217,031 4,505 100.0%
====== ======= ======= ===== ========= ===== =====
</TABLE>

S-9
<PAGE> 10

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1997
PERCENT OF TOTAL REVENUES
------------------------------
OIL GAS LIQUIDS TOTAL
--- --- ------- -----
<S> <C> <C> <C> <C>
D-J Basin............................................. 29% 25% 11% 65%
Mid-Continent......................................... 6 28 0 34
Other................................................. 0 1 0 1
--- --- -- ---
Total................................................. 35% 54% 11% 100%
=== === == ===
</TABLE>

BUSINESS STRATEGY

HSR's objective is to maximize shareholder value through aggressive growth
in its oil and gas reserves and production. To achieve these objectives, the
Company pursues a strategy of (i) building a substantial inventory of
development, exploitation and exploration projects, (ii) utilizing
state-of-the-art exploration, drilling, completion and production techniques,
(iii) consolidating in core geographic areas while divesting non-core assets,
(iv) maintaining efficient, low cost operations, (v) capturing downstream value,
and (vi) maximizing financial flexibility.

Build a Substantial Inventory of Development, Exploitation and Exploration
Projects. The Company intends to continue expanding its substantial portfolio of
development, exploitation and exploration projects. HSR has identified
approximately 900 development drillsites, over 200 refrac opportunities and 250
potential infill drillsites in the D-J Basin. The lower risk refrac, infill and
development projects in the D-J Basin are complemented by relatively higher risk
and potentially higher return exploitation and exploration projects in all four
of the Company's core areas. Based upon preliminary interpretation of seismic
and geologic data, the Company has identified approximately 218 exploitation and
development drilling locations in the Mid-Continent area, approximately 62
exploitation and exploration projects and leads in its Gulf Coast project areas
and approximately 13 such projects and leads in the Greater D-J Basin.

Utilize Advanced Techniques to Fully Exploit its Assets. In the D-J Basin,
the Company has tested and is using sophisticated fracturing technologies and
directional drilling to enhance production and obtain additional reserves from
existing wellbores. In order to improve its exploitation and exploration
drilling success rates, the Company utilizes 3-D seismic data extensively,
including advanced imaging techniques of coherence cube or continuity processing
and advanced interpretation and geostatistical techniques. The Company has
acquired more than 570 square miles of 3-D seismic data in its core geographic
areas and plans to acquire an additional 300 square miles of 3-D seismic data
within the next six months. The Company, directly or indirectly, employs or
contracts with 27 experienced geologists and geophysicists to develop its
projects.

Consolidate in Core Geographic Areas. The Company continues to pursue its
strategy of efficient consolidation in core areas. By effecting consolidation in
the D-J Basin, the Company capitalizes on opportunities for further operating
and administrative cost efficiencies and improves its product marketing position
through control of increased volumes. The Company also believes that further
consolidation in the D-J Basin would enable it to utilize existing wellbores
instead of drilling new wells to reach reserves that were previously
economically stranded by segregation of mineral interests. HSR is pursuing a
similar consolidation strategy in various fields and basins in the Mid-Continent
area. Equally important to the Company is the selective divestiture of
properties that are not a part of its core property set. This asset portfolio
management process allows the Company to maximize its efficiency in terms of
cost, personnel and expertise.

Maintain Efficient, Low Cost Operations. The Company is an industry leader
in operational efficiencies and field management, historically ranking as one of
the lowest cost operators in the United States. For the six months ended June
30, 1997, the Company's general and administrative expenses were $0.67 per Boe,
and its lease operating expenses were $2.75 per Boe.

Capture Downstream Value. The Company seeks to enhance both its margins and
operating flexibility through its marketing, trading and transportation
business. In July 1997, the Company established a new strategy

S-10
<PAGE> 11

for marketing its gas production and for conducting its trading business through
its wholly-owned subsidiary, HS Energy Services, Inc. ("HSES"). See " -- Recent
Developments -- Natural Gas Marketing and Trading."

Maximize Financial Flexibility. The Company is committed to maintaining
substantial financial flexibility. In funding its growth, HSR has employed a
broad array of financing structures, divestitures and asset monetizations.
Management currently expects its 1997 capital expenditure budget to be funded by
internally-generated cash flow. Since June 30, 1996, the Company's long-term
debt has been reduced to approximately $349 million from $399.8 million using
the proceeds of asset sales and internally-generated cash flow. Over the same
period, floating rate debt as a percentage of total debt has been reduced to 13%
from 61%.

RECENT DEVELOPMENTS

Natural Gas Markets

Since the beginning of 1996, the market for the Company's D-J Basin gas has
strengthened substantially due to several factors. First, the excess supply from
Wyoming gas producers has declined as a result of increased demand from West
Coast markets. Second, in October 1995 the Colorado Public Utilities Commission
approved tariff changes that effectively eliminated transportation costs for D-J
Basin gas sold to the Colorado Front Range market, resulting in a transportation
cost advantage for D-J Basin producers of approximately $0.40 per MMBtu. Third,
the supply of D-J Basin gas has declined over the last two years due to the
combination of reduced drilling in the D-J Basin and natural production
declines. The average gas price received by the Company for its D-J Basin
production has increased from $1.28 per Mcf in 1995 to $1.90 per Mcf in 1996 and
to $2.08 per Mcf in the six months ended June 30, 1997. In addition, expansion
of pipeline capacity has begun, which is expected to be available in the Fall of
1997. The pipeline capacity will provide additional transportation outlets for
Wyoming producers to markets other than the Colorado Front Range and provide
Colorado Front Range producers access to other markets. The Company believes
that these developments will further reduce the disparity between D-J Basin
pricing and pricing generally available elsewhere in the United States.

During the first nine months of 1997, the average gas price received by the
Company was $2.05 per Mcf compared to $1.67 per Mcf for the same period last
year. Prices available to the Company for forward sales deliveries during the
upcoming winter season have been higher than these averages. The Company has
moved to capture these higher prices by entering into forward sales agreements
on a significant portion of its gas production. The Company has hedged
approximately 60% of its overall gas production for the fourth quarter of 1997
at an average price of approximately $2.57 per Mcf.

For more information concerning the volatility of natural gas prices, see
"Risk Factors -- Volatility of Oil and Natural Gas Prices; Marketability of
Production" in the accompanying Prospectus.

Acquisitions and Divestitures

The Company is committed to strategic rationalization of assets in each of
its core areas either through consolidation, diversified acquisitions or
divestitures of non-core properties. The Company has aggressively pursued these
objectives, resulting in two significant dispositions, several smaller tactical
acquisitions, the screening of numerous acquisition opportunities and the
identification and marketing of two other disposition packages.

Divestitures. During 1997, the Company has sold non-strategic, non-core
properties in two transactions for an aggregate of $34.1 million in cash as well
as certain properties. The divested properties generated $5.4 million of net
operating cash flow and approximately 8 MMcf per day of gas in 1996.

Acquisitions. The Company is pursuing a number of acquisition
opportunities, including consolidation in the D-J Basin. The Company believes
that it has a competitive advantage in capturing and maximizing the value of
certain D-J Basin properties as a result of the unique location of the Company's
existing base of more than 2,000 Wattenberg producing wells. These wells would
provide access to reserves that are economically stranded by segregation of
mineral interests. The Company's substantial D-J Basin infrastructure,
experienced operating personnel, low operating costs, significant gas marketing
position, and 15-year operating history in the area, resulting in superior
technical and operating knowledge, may also provide a competitive advantage in
capturing

S-11
<PAGE> 12

and maximizing the value of acquired properties. The Company also believes that
ultimate value maximization in the Wattenberg Field area will result from a
combination of the Company's assets, technical expertise and substantial
operating base with those of other asset owners in the area. Value maximization
can be achieved either through direct ownership or a shared value arrangement.

Natural Gas Marketing and Trading

In July 1997 the Company established a new strategy for marketing its
natural gas production through its wholly-owned subsidiary, HSES, which
purchases and markets all of the Company's natural gas production. HSES has a
five-part mission: (i) sell the equity gas of the Company at the greatest price
possible, (ii) execute the risk management strategy of the Company, (iii) market
value-added energy services to industrial, commercial and utility users in the
Mid-Continent and Colorado Front Range areas, (iv) take advantage of arbitrage
opportunities that arise among the various basins in which the Company produces
and (v) purchase and resell third party gas to assist in the achievement of
these goals.

HSES has committed most of the Company's equity production from the D-J
Basin to variable price term contracts with a large number of customers in
response to the unique transportation and pricing circumstances for D-J Basin
gas. Prior to the integration of the Company's Mid-Continent and Colorado Front
Range marketing operations, the Company followed a marketing strategy that
included a significant component of fixed-price term contracts as a means of
managing its forward price risks. That strategy reflected the high concentration
of assets in the D-J Basin and, because there was no well-established D-J Basin
gas price index, the Company's inability to hedge price and basis risk. Because
the Company can now supplement its obligations in either the D-J Basin or the
Mid-Continent with supply from the other area, HSES now has increased
flexibility to enter into and hedge fixed quantity, floating price agreements in
which the price is tied to index prices applicable to sales of its D-J Basin
gas.

D-J Basin Projects

Wattenberg Field Area. The Company has drilled 50 wells in the Wattenberg
Field since the beginning of the year, accounting for approximately 5.2 MMcf of
gas and 1,200 Bbls of oil production per day as of September 30, 1997. HSR has
in inventory 900 development drillsites, of which 604 are included in proved
undeveloped reserves. In addition, the Company has identified approximately 240
recompletion opportunities in Wattenberg and at least 250 potentially economic
infill drillsites.

The Company is currently studying its ability to increase Codell production
from existing wells through a process of restimulating (or "refracing") the
currently producing formation. The Company has recently conducted a pilot
program consisting of 10 refrac projects, all of which were successful. Through
the refrac process, the Company restimulated each well to achieve production
levels, reserve increases and decline profiles approaching the well's initial
characteristics. The Company believes that there are more than 200 opportunities
for this type of well stimulation. In addition, gas production from many of the
refrac candidates generate Section 29 tax credits of approximately $0.60 per
Mcf, which the Company monetizes under its existing Section 29 monetization
arrangements.

Greater D-J Basin. The Greater D-J Basin, in which the Company owns rights
to more than 195,000 gross undeveloped acres, provides HSR with significant
exploitation and exploration potential through the use of advanced technologies
such as 3-D seismic continuity processing and geostatistical analysis. In 1997,
the Company drilled and completed nine wells, currently producing approximately
1,000 Bbls per day of oil and 1.6 MMcf per day of gas. The Company has 13 active
projects and leads in this area under review by its geotechnical staff.

Mid-Continent Projects

The Company has identified over 200 potential development and exploitation
drilling opportunities and 84 recompletion opportunities in the Mid-Continent.
In 1997, the Company has participated in the drilling of 21 wells and performed
15 recompletions (primarily as non-operator) adding approximately 4 MMcf per day
of

S-12
<PAGE> 13

gas net to the Company as of September 30, 1997. The Company is committed to
drilling 11 wells and undertaking eight recompletions as operator and to
participating in the drilling of five wells as non-operator.

In the Anadarko Basin, the Company owns interests in 664 wells in numerous
fields, including Mocane-Laverne, Bivins Ranch, Bishop and Watonga, each of
which provides potentially attractive exploitation opportunities. The Company
has identified approximately 51 drilling opportunities and 30 recompletions in
these four fields. After analyzing 13 square miles of 3-D seismic data in Bivins
Ranch, the Company plans to drill at least two wells by year end. If these wells
are successful, the Company would likely drill up to six more wells in Bivins
Ranch in 1998.

In the Arkoma Basin, the Company owns interests in 374 wells in the Kinta,
Bokoshe, Russellville, Wilburton and other fields. In those four fields alone,
the Company has identified approximately 129 drilling and 22 recompletion
opportunities.

Other areas present additional opportunities. For example, with the use 3-D
seismic data, the Company has identified further drilling opportunities at La
Reforma Field in northwestern Hidalgo County, Texas, in which the Company owns
interests in a 5,100 acre contiguous block. As part of its remaining 1997
projects, the Company plans to drill one additional well in this field and may
drill additional wells in 1998.

Gulf Coast Projects

The Company's on-shore Gulf Coast activity is focused in southwest
Louisiana and southeast Texas. To date the Company has acquired over 270 square
miles of 3-D seismic data and is in the process of acquiring more than 260
additional square miles of data.

One well has been drilled in the Roanoke project area resulting in a
discovery at the HSR Kratzer #1. The Company has a 30.4% working interest in
this well, which tested at a rate of 5.2 MMcf of gas and 145 Bbls of condensate
per day. The well is currently waiting for pipeline hookup.

The four wells drilled in the South Devillier project area have resulted in
one discovery, the HSR Cooper #2. The Company has a 50% working interest in this
well, which was put on line in early June 1997. This well is currently producing
5 MMcf of gas and 150 Bbls of condensate per day from the Vicksburg formation.
As the result of a limited reservoir, the Company has revised its estimates of
reserves downward to 0.3 MMBoe.

Drilling in the Buhler project area has yielded eight discoveries from 10
wells. Though the Company's working interest is relatively small in the 76
square mile Buhler program, the technology gained from the program has provided
the basis for developing three additional project areas, in which the Company's
working interests range from 25% to 50%. For example, the North Gillis program
in Calcasieu Parish, Louisiana, in which the Company has a 37.5% working
interest, is a direct offset and analog to the successful Buhler program. This
program is targeting Hackberry and Yegua sands and the 3-D seismic survey is
estimated to be complete through geophysical processing by year end with
drilling to commence in the first half of 1998.

The Company has a 25% working interest in the Iowa/Welsh 3-D project
operated by Sonat Exploration, Inc. in Jefferson Davis Parish, Louisiana. The
135 square mile 3-D seismic survey is anticipated to be completed by year end
1997 with initial drilling to follow in late 1998.

At the Port Barre project in St. Landry Parish, Louisiana, the Company is
in the field acquisition phase of a 55 square mile 3-D seismic survey. The 3-D
seismic data acquisition is anticipated to be completed in December, 1997 with
initial drilling expected to commence in the second half of 1998. The Company
has a 100% working interest in the Port Barre program.

The Company has acquired 13 square miles of 3-D seismic data in its
Jennings project area. The Haber #1, operated by the Company, is currently being
drilled and is expected to reach total depth by Mid-October. The Company has a
working interest of 37.5% in the Jennings project area.

S-13
<PAGE> 14

Northern Rocky Mountain Projects

The Company's strategic focus for the Northern Rocky Mountain area is to
optimize production, fund exploratory activity through joint ventures, and
continue evaluation of undeveloped acreage. The Company has entered into
agreements with several operators with specific areas of technological or
operational expertise to evaluate and exploit certain of its large acreage
positions. By year end, the Company expects this effort to have resulted in the
drilling of up to seven wildcats and the acquisition of 50 square miles of 3-D
seismic data.

For example, the Company has entered into an agreement with Union Pacific
Resources Company ("UPRC") on over 300,000 gross acres in Daniels County,
Montana in the Williston Basin. Through the agreement, UPRC will drill at least
two dual-lateral horizontal wells in 1997. The first well reached its objective
and is awaiting completion. Drilling for the second well is expected to commence
during the fourth quarter.

In the central portion of the Williston, in Richland and Roosevelt County,
Montana, HSR has entered into joint venture agreements with experienced local
operators. These agreements will result in the drilling of two wells and 32
square miles of 3-D seismic data. The seismic data has been acquired and is
awaiting interpretation, and the first well is nearing its targeted depth.

The Company retains a significant acreage position in the Greater Green
River Basin. This is one of the most active areas in the Northern Rocky Mountain
area where new geophysical, drilling and completion technologies are unlocking
new, high-potential play concepts.

S-14
<PAGE> 15

SELLING STOCKHOLDER

The following table sets forth certain information regarding the Selling
Stockholder's beneficial ownership of Common Stock as of September 30, 1997, the
number of shares being offered by the Selling Stockholder in the Offering and
the number and percentage of the outstanding shares to be owned by the Selling
Stockholder after the Offering, assuming all of the shares offered hereby are
sold.

<TABLE>
<CAPTION>
SHARES OF COMMON STOCK NUMBER OF SHARES OF COMMON STOCK
BENEFICIALLY OWNED SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING(1) OFFERED HEREBY AFTER THE OFFERING(1)
------------------------ FOR STOCKHOLDER'S ----------------------
NAME OF BENEFICIAL OWNER NUMBER PERCENTAGE ACCOUNT NUMBER PERCENTAGE
------------------------ --------- ---------- ----------------- ------- ----------
<S> <C> <C> <C> <C> <C>
Natural Gas Partners,
L.P.(2)................. 2,183,706 12.6% 1,850,010 333,696 1.9%
</TABLE>

- ---------------

(1) Includes 7,500 shares subject to issuance within 60 days after September 30,
1997, upon the exercise of options granted under the Company's 1993
Directors' Plan to Kenneth A. Hersh and subsequently assigned by Mr. Hersh
to the Selling Stockholder.

(2) Under the rules of the Securities and Exchange Commission, G.F.W. Energy,
L.P., the sole general partner of Natural Gas Partners, L.P., and its sole
general partner, R. Gamble Baldwin, may also be deemed to be beneficial
owners of the Common Stock held by the Selling Stockholder.

Kenneth A. Hersh is a member of the board of directors of the Company and a
manager of the Natural Gas Partners funds, including the Selling Stockholder.
The Selling Stockholder has been an investor in the Company since 1990, when it
acted as a subordinated lender to the Company and acquired warrants to purchase
740,262 shares of Common Stock. The Selling Stockholder became a major
stockholder of the Company as a result of the 1996 merger of Tide West Oil
Company ("Tide West") into the Company, acquiring 2,864,225 shares of Common
Stock in exchange for its Tide West shares. The Selling Stockholder has
exercised (by cashless exercise) all of its warrants, at an exercise price of
$10.00 per share.

The Selling Stockholder is liquidating a portion of its holdings in the
Company in accordance with its obligations to its limited partner under the
termination provisions of the Selling Stockholder's limited partnership
agreement. Net proceeds from the sale of the Common Stock offered hereby will be
used by the Selling Stockholder to make a liquidating distribution to its
limited partner. The remaining shares of Common Stock held by the Selling
Stockholder will be distributed by the Selling Stockholder to its general
partner.

Pursuant to a voting agreement between the Company and the Selling
Stockholder executed in connection with the Company's merger with Tide West, the
Company is obligated to nominate a designee of the Selling Stockholder to the
Company's Board of Directors. Following the Merger, the Company's Board of
Directors appointed Mr. Philip B. Smith, the designee of the Selling
Stockholder, as a director of the Company. The provisions of the voting
agreement obligating the Company to nominate the Selling Stockholder's designee
will terminate upon the completion of the Offering. Consequently, the Company
will not be obligated to nominate a designee of the Selling Stockholder to the
Company's board of directors upon the expiration of Mr. Smith's term in 1998.

Under certain circumstances, the Selling Stockholder has agreed to pay
certain of the Company's expenses incurred in connection with the Offering. For
additional information concerning the Selling Stockholder and its transactions
with the Company, see "Selling Stockholder" in the accompanying Prospectus.

S-15
<PAGE> 16

UNDERWRITING

The Underwriters of the Offering (the "Underwriters"), for whom Lehman
Brothers Inc. ("Lehman"), Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Petrie Parkman & Co. are serving as representatives (the "Representatives"),
have severally agreed, subject to the terms and conditions of the underwriting
agreement (the "Underwriting Agreement"), to purchase from the Selling
Stockholder, and the Selling Stockholder has agreed to sell to the Underwriters,
the aggregate number of shares of Common Stock set forth opposite their
respective names below:

<TABLE>
<CAPTION>
NUMBER
UNDERWRITERS OF SHARES
------------ ---------
<S> <C>
Lehman Brothers Inc......................................... 616,670
Merrill Lynch, Pierce, Fenner & Smith Incorporated.......... 616,670
Petrie Parkman & Co......................................... 616,670
---------
Total............................................. 1,850,010
=========
</TABLE>

The Underwriting Agreement provides that the obligations of the
Underwriters to purchase shares of Common Stock are subject to the approval of
certain legal matters by counsel and to certain other conditions and that if any
of the foregoing shares of Common Stock are purchased by the Underwriters
pursuant to the Underwriting Agreement, all the shares of Common Stock agreed to
be purchased by the Underwriters pursuant to the Underwriting Agreement must be
so purchased.

The Company and the Selling Stockholder have been advised that the
Underwriters propose to offer shares of Common Stock directly to the public at
the public offering price set forth on the cover page of this Prospectus
Supplement and to certain selected dealers (who may include the Underwriters) at
such public offering price less a selling concession not to exceed $0.52 per
share. The selected dealers may reallow a concession not to exceed $0.10 per
share to certain brokers and dealers. After the initial offering of the Common
Stock, the public offering price, the concession to selected dealers and the
reallowance to other dealers may be changed by the Underwriters.

The Company, certain of its subsidiaries, and the Selling Stockholder have
agreed to indemnify the Underwriters against certain liabilities, including
liabilities under the Securities Act, and to contribute to the payments the
Underwriters may be required to make in respect thereto.

In connection with the Offering, the Company has agreed not to, directly or
indirectly, offer, sell, contract to sell or otherwise dispose of any shares of
Common Stock or any securities convertible into or exercisable for Common Stock
for a period of 45 days after the date the shares of Common Stock are delivered
to the Underwriters pursuant to the Offering (the "Delivery Date") without the
prior written consent of Lehman. In addition, the Selling Stockholder has agreed
not to, directly or indirectly, offer, sell, contract to sell or otherwise
dispose of any shares of Common Stock or any securities convertible into or
exercisable for Common Stock for a period of 90 days after the Delivery Date
without the prior written consent of Lehman. Such restrictions will not apply to
any shares purchased in the Offering or otherwise on the open market. In
addition, the restrictions on transfer placed on the Selling Stockholder will
not apply to the distribution of the remaining shares of Common Stock held by
the Selling Stockholder to its general partner and its partners.

The Underwriters do not intend to confirm sales to any accounts over which
they exercise discretionary authority.

Until the distribution of the Common Stock is completed, rules of the
Securities and Exchange Commission may limit the ability of the Underwriters to
bid for and purchase shares of Common Stock. As an exception to these rules, the
Representatives are permitted to engage in certain transactions that stabilize
the price of the Common Stock. Such transactions may consist of bids or
purchases for the purpose of pegging, fixing or maintaining the price of the
Common Stock.

S-16
<PAGE> 17

If the Underwriters create a short position in the Common Stock in
connection with the Offering (i.e., if they sell more shares of Common Stock
than are set forth on the cover page of this Prospectus Supplement), the
Representatives may reduce that short position by purchasing Common Stock in the
open market.

Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Common Stock. In addition, neither
the Company nor any of the Underwriters makes any representation that the
Representatives will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.

Lehman has provided financial advisory services to the Company and to
entities related to the Company and may in the future provide financial advisory
services to the Company or such other entities, for which they have received or
expect to receive customary fees.

LEGAL MATTERS

The validity of the Common Stock offered hereby has been passed upon by
Davis, Graham & Stubbs LLP, Denver, Colorado. Certain matters have been passed
upon for the Underwriters by Akin, Gump, Strauss, Hauer & Feld, L.L.P., Dallas,
Texas.

S-17
<PAGE> 18

PROSPECTUS

3,175,701 SHARES

HS RESOURCES, INC.
COMMON STOCK

OFFERED BY THE SELLING STOCKHOLDER

The shares of Common Stock, $.001 par value ("Common Stock"), of HS
Resources, Inc. (the "Company" or "HSR") offered by this Prospectus (the
"Shares") are for the account of a certain stockholder of the Company (the
"Selling Stockholder"). The Company will receive none of the proceeds from the
sale of the Shares. The Selling Stockholder directly, through agents designated
from time to time, or through dealers or underwriters also to be designated, may
sell the Shares from time to time on terms to be determined at the time of sale.
To the extent required, the specific Shares to be sold, the terms of the
offering, including price, the names of any agent, dealer or underwriter, and
any applicable commission, discount or other compensation with respect to a
particular sale will be set forth in an accompanying Prospectus Supplement. See
"Plan of Distribution" and "Selling Stockholder."

The Company's Common Stock is listed on The New York Stock Exchange
(Symbol: "HSE"). The Shares have been listed on such exchange.
SEE "RISK FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SHARES OFFERED
HEREBY.

---------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

---------------------------

The Selling Stockholder and any broker-dealer, agents or underwriters that
participate with the Selling Stockholder in the distribution of the Shares may
be deemed to be underwriters within the meaning of the Securities Act of 1933,
as amended (the "Securities Act"), and any commission received by them and any
profit on the resale of the Shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act. See "Plan of
Distribution" for indemnification arrangements regarding the sales by the
Selling Stockholder. The Company has paid substantially all of the costs of this
offering, estimated at $35,000.

THE DATE OF THIS PROSPECTUS IS JUNE 20, 1997
<PAGE> 19

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS OR IN ANY ACCOMPANYING PROSPECTUS SUPPLEMENT, AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER, AGENT OR DEALER. THIS
PROSPECTUS AND ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE
SHARES OR AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, TO ANY PERSON
IN ANY JURISDICTION WHERE SUCH AN OFFER OR SOLICITATION WOULD BE UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY ACCOMPANYING PROSPECTUS
SUPPLEMENT, NOR ANY SALE MADE THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
THE IMPLICATION THAT THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE
HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THEIR RESPECTIVE
DATES.

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information....................................... 2
Incorporation of Certain Documents by Reference............. 3
The Company................................................. 5
Risk Factors................................................ 6
Use of Proceeds............................................. 9
Selling Stockholder......................................... 10
Plan of Distribution........................................ 11
Validity of Securities...................................... 11
Experts..................................................... 11
</TABLE>

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). The Company is currently
subject to the periodic reporting and other informational requirements of the
Exchange Act. Such reports and other information may be inspected and copied at
the public reference facilities of the Commission, Room 1024, Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549, as well as at the following
Regional Offices: 7 World Trade Center, Suite 1300, New York, New York 10048,
and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material can be obtained from the Commission by mail at
prescribed rates. Requests should be directed to the Commission's Public
Reference Section, Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. The Commission also maintains a website at
http://www.sec.gov that contains reports, proxy statements, and other
information. HSR's Common Stock is listed on The New York Stock Exchange (the
"NYSE"). Reports, proxy and information statements and other information
relating to HSR can be inspected at the offices of the NYSE at 20 Broad Street,
New York, New York 10005. Any such request and requests for the agreements
summarized herein should be directed to James M. Piccone, Secretary, HS
Resources, Inc., 1999 Broadway, Suite 3600, Denver, Colorado 80202, telephone
(303) 296-3600.

The Company has filed with the Commission a Registration Statement on Form
S-3 (the "Registration Statement") under the Securities Act with respect to the
Shares. This Prospectus, which constitutes a part of the Registration Statement,
does not contain all the information set forth in the Registration Statement in
accordance with the rules and regulations of the Commission, and reference is
hereby made to the Registration Statement and the exhibits thereto for further
information with respect to the Company and the Shares.

2
<PAGE> 20

The Registration Statement and the exhibits thereto can be obtained from or
inspected and copied at the public reference facilities maintained by the
Commission as described above.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The Company's Annual Report on Form 10-K as amended by the Company's Form
10-K/A-1 for the year ended December 31, 1996, Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997 and Current Report on Form 8-K, filed February
26, 1997, are incorporated by reference in this Prospectus. All documents filed
by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the securities registered hereunder shall be
deemed to be incorporated by reference in this Prospectus and to be part hereof
from the date of filing such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document that also
is or is deemed to be incorporated by reference herein modifies or supersedes
such statement. Any statement modified or superseded shall not be deemed, except
as so modified or superseded, to constitute part of this Prospectus.

Upon request, the Company will provide without charge to each person to
whom a copy of this Prospectus has been delivered a copy of any documents
incorporated by reference herein (other than exhibits unless the exhibits are
specifically incorporated by reference into this Prospectus). Requests should be
directed to James M. Piccone, Secretary, HS Resources, Inc., 1999 Broadway,
Suite 3600, Denver, Colorado 80202.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This Prospectus includes and incorporates by reference statements that are
not purely historical and are "forward-looking statements" within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act, including
statements regarding the Company's expectations, hopes, beliefs, intentions or
strategies regarding the future. All statements other than statements of
historical facts included or incorporated by reference in this Prospectus,
including without limitation, statements made herein under "Risk Factors" and
statements in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996 under "Business," "Properties," "Legal Proceedings and
Environmental Issues" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations," regarding reserves and their values,
planned capital expenditures, increases in oil and natural gas production,
trends or expectations concerning oil and gas prices, the number and prospective
nature of anticipated wells to be drilled in 1997 and thereafter, development
potential, infill potential, drillsite potential, exploitation and exploration
prospects and leads, drilling prospects, consolidation opportunities and the
Company's financial position, business strategy and other plans and objectives
for future operations, potential liabilities or the expected absence thereof,
the potential outcome of environmental matters, litigation and other proceedings
are forward-looking statements. All forward-looking statements included or
incorporated by reference in this Prospectus are based on information available
to the Company on the date hereof, or, with respect to documents incorporated by
reference, on the date thereof, and the Company assumes no obligation to update
such forward-looking statements. Although the Company believes that the
assumptions and expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have
been correct or that the Company will take any actions that may presently be
planned. There are numerous uncertainties inherent in estimating quantities of
proved oil and natural gas reserves and projecting future rates of production
and timing of development expenditures, including many factors beyond the
control of the Company.

3
<PAGE> 21

(iii) issue additional debt or equity securities. Second, lower product prices
could cause the borrowing base under the Company's bank credit agreement to be
reduced and certain covenant tests to be adversely affected. Third, under rules
promulgated by the Commission, companies that follow the full cost accounting
method are required to make quarterly "ceiling test" calculations. Lower product
prices adversely impact the ceiling calculation. Should the Company realize
sustained lower product prices, it could be required to write down its oil and
gas properties, resulting in a non-cash charge against earnings.

Certain additional important factors that could cause actual results to
differ materially from the Company's forward-looking statements are disclosed
herein under "Risk Factors," under "Business," "Properties," "Legal Proceedings
and Environmental Issues," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and elsewhere in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 and in the Company's
Current Report on Form 8-K filed February 26, 1997, each of which is
incorporated by reference herein. All subsequent written or oral forward-looking
statements attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by such factors.

4
<PAGE> 22

THE COMPANY

HS Resources, Inc. is a leading United States independent energy company
engaged in the development, acquisition, exploitation, exploration, production
and marketing of oil and natural gas. Through its experienced management and
technical staff, the Company has consistently increased reserves and production
and has established itself as one of the most efficient operators in the
industry. HSR has created a diversified asset base in three core geographic
areas: the Denver-Julesburg Basin (the "D-J Basin") of the Rocky Mountains, the
Anadarko and Arkoma Basins of the Mid-Continent and the on-shore Gulf Coast
area. It has done so by executing a large scale development drilling program
focused in the Wattenberg Field area of the D-J Basin and through the
acquisition of all the D-J Basin properties owned by Basin Exploration, Inc.
(the "Acquisitions"), the merger with Tide West Oil Company (the "Merger") and
the formation of Gulf Coast joint ventures. The Company believes that each core
geographic area presents operational and financial opportunities, positioning
the Company to maximize the benefits of its more predictable, long-lived
production in the D-J Basin, while providing meaningful exposure to potential
exploitation and exploration projects in the Mid-Continent and Gulf Coast, which
exhibit higher return potential. HSR has an inventory of growth opportunities
that includes in excess of 2,000 infill, development and exploratory drilling
locations and over 1.1 million gross undeveloped acres.

The Company has achieved substantial growth in reserves, production,
revenues and operating cash flow over the past five years. HSR has increased
reserves from 20.8 MMBoe as of December 31, 1990, to 142.0 MMBoe as of December
31, 1996. HSR also increased production from 0.9 MMBoe for the year ended
December 31, 1991, to 7.6 MMBoe for the year ended December 31, 1996. Oil and
natural gas revenues and operating cash flow (defined as net income before
depreciation, depletion and amortization and deferred income taxes) also have
grown significantly over this period, increasing from $12.8 million and $5.4
million, respectively, for the year ended December 31, 1991, to $107.3 million
and $56.5 million, respectively, for the year ended December 31, 1996.

At December 31, 1996, the Company's reserves had an estimated pre-tax
present value (discounted at 10%) of $1,131 million. Natural gas constituted
approximately 76% of the Company's reserves and approximately 76% of the
Company's reserves were classified as proved developed. At December 31, 1996,
the Company operated approximately 74% of its 3,562 wells. Management believes
that its ability to control the operation of its wells and to minimize overhead
expenses has contributed to the Company achieving one of the lowest cost
structures in the industry.

The Company's principal executive office is located at One Maritime Plaza,
15th Floor, San Francisco, California 94111 and its telephone number at such
address is (415) 433-5795.

5
<PAGE> 23

RISK FACTORS

Prospective purchasers of the Shares should consider carefully the specific
factors set forth below, as well as the other information set forth elsewhere or
incorporated by reference in this Prospectus, in connection with their
investment in the Company.

VOLATILITY OF OIL AND NATURAL GAS PRICES; MARKETABILITY OF PRODUCTION

The Company's revenues, profitability and future rate of growth are
substantially dependent upon prevailing prices for its oil and natural gas.
Hydrocarbon prices can be extremely volatile and in recent years have been
depressed at times by warm weather, weak demand and excess total domestic and
imported supplies. Oil and natural gas prices have risen recently, but there can
be no assurance that such price levels will be sustained. Prices are also
affected by actions of state and local agencies, the United States and foreign
governments and international cartels. These external factors and the volatile
nature of the energy markets make it difficult to estimate accurately future
prices of oil and natural gas. Prices for D-J Basin natural gas, which
represents a significant portion of the Company's overall production, were
depressed until recently and have at times been more volatile than the prices
prevailing in the broader United States natural gas market. Although from time
to time the Company hedges a portion of its oil and natural gas production to
provide some protection from price declines, any substantial or extended decline
in the price of oil or natural gas would have a material adverse effect on the
Company's financial condition and results of operations. The marketability of
the Company's production depends upon the availability and capacity of
refineries, natural gas gathering systems, pipelines and processing facilities.
Federal and state regulation of oil and natural gas production and
transportation, general economic conditions and changes in supply and demand all
could adversely affect the Company's ability to produce and market its oil and
natural gas. If market factors were to change dramatically, the financial impact
on the Company could be substantial. The availability of markets and the
volatility of product prices are beyond the control of the Company and thus
represent a significant risk. See "-- Governmental and Environmental Regulation"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations" incorporated by reference in this Prospectus.

EFFECTS OF LEVERAGE; EXISTING INDEBTEDNESS

As of March 31, 1997, the Company's total long-term debt was approximately
$363.6 million. The Company's leverage has important consequences to the
Company's stockholders, including the following: (i) the Company's ability to
obtain additional financing in the future for working capital, capital
expenditures, acquisitions or general corporate purposes may be impaired; (ii) a
portion of the Company's cash flow from operations must be dedicated to the
payment of the principal of and interest on its existing indebtedness; (iii)
certain of the Company's borrowings, principally those under the Company's
revolving credit facility, are at variable rates of interest, which may make the
Company vulnerable to increases in interest rates; and (iv) the terms of certain
of the Company's indebtedness permit its creditors to accelerate payments upon
certain events of default or a change of control of the Company. As of March 31,
1997, excluding the effect of interest rate hedging arrangements covering $80
million in principal amount of indebtedness, 38.4% of the aggregate borrowings
of the Company were floating rate obligations and 61.6% of the Company's
borrowings were fixed rate obligations, with an overall range of interest rates
from 6 1/2% to 9 7/8% per annum. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources" incorporated by reference in this Prospectus.

The Company's revolving credit facility, and the indentures under which the
Company's 9 1/4% Senior Subordinated Notes due 2006 (the "9 1/4% Notes") and
9 7/8% Senior Subordinated Notes due 2003 (the "9 7/8% Notes") were issued (the
"Indentures"), impose financial and other restrictions on the Company and its
subsidiaries, including limitations on the incurrence of additional indebtedness
and limitations on the sale of assets. The Company's revolving credit facility
also requires the Company to (i) make periodic payments of interest, (ii) make
principal payments from the proceeds of certain asset sales and in the event the
Company's outstanding debt exceeds the Borrowing Base (as defined therein),
(iii) maintain certain financial ratios, including interest coverage and
leverage ratios and (iv) maintain a minimum level of consolidated cash flow.
There can be no assurance that these requirements or other material requirements
of the Company's revolving credit facility

6
<PAGE> 24

will be met in the future. If they are not, the lenders under such facility
would be entitled to declare the indebtedness thereunder immediately due and
payable. Additionally, in the event of such an acceleration of indebtedness by
the lenders under the Company's revolving credit facility, a default would be
deemed to occur under the terms of the 9 1/4% Notes and the 9 7/8% Notes. In
addition, the Indentures contain certain restrictive covenants that may limit
the ability of the Company to engage in certain transactions.

Based upon the current and anticipated level of operations, the Company
believes that its cash flow from operations, together with the proceeds
available under the Company's revolving credit facility and its other sources of
liquidity, will be adequate to meet its anticipated requirements in the
foreseeable future for working capital, capital expenditures, interest payments
and scheduled principal payments. There can be no assurance, however, that the
Company's business will continue to generate cash flow at or above current
levels. If the Company is unable to generate sufficient cash flow from
operations to service its debt, it may be required to refinance all or a portion
of its existing debt (provided the necessary consents are obtained), or to
obtain additional financing. There can be no assurance that any such refinancing
would be possible or that any additional financing could be obtained. The
Company's ability to meet its debt service obligations and reduce total
indebtedness will be dependent not only upon its future drilling and production
performance, but also on oil and natural gas prices, general economic conditions
and financial, business and other factors affecting the Company's operations,
many of which are beyond the Company's control. The Company's strategy and
historical focus has been, and is expected to continue to be, the development,
acquisition, exploitation, exploration, production and marketing of oil and
natural gas. Each of these activities requires substantial capital. The Company
intends to finance such capital expenditures in the future through cash flow
from operations, the incurrence of additional indebtedness and/or the issuance
of additional equity securities. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources" incorporated by reference in this Prospectus.

ESTIMATION OF RESERVES

There are numerous uncertainties in estimating quantities of proved
reserves, future rates of production and the timing and success of development
expenditures, including many factors beyond the control of the Company. Thus,
the reserve data incorporated by reference in this Prospectus are calculated
estimates only. Although the Company believes all of its reserve estimates to be
reasonable, reserve estimates are only estimates and should be expected to
change as additional information becomes available. Furthermore, estimates of
oil and natural gas reserves, of necessity, are projections based on engineering
and production data, and the interpretation thereof, the projection of future
rates of production and the timing and success of development expenditures.

Reserve engineering is a subjective process of estimating underground
accumulations of oil and natural gas that cannot be exactly measured, and the
accuracy of any reserve estimate is a function of the quality of available data
and of engineering and geological interpretation and judgment. Accordingly,
estimates of the economically recoverable quantities of oil and natural gas
attributable to any particular property or group of properties, classifications
of such reserves based on risk of recovery and estimates of the future net cash
flows expected therefrom, which are prepared by different engineers or by the
same engineers at different times, may vary substantially. Moreover, there can
be no assurance that the reserves set forth herein will ultimately be produced
or that the proved undeveloped reserves will be developed within the periods
anticipated. Variances from the estimates contained herein could be material. In
addition, the estimates of future net revenues from proved reserves of the
Company and the present value thereof are based upon certain assumptions about
production levels, prices and costs, which may be inaccurately estimated. With
respect to such estimates, the Company emphasizes that the discounted future net
cash flows should not be construed as representative of the fair market value of
the proved oil and natural gas properties belonging to the Company, as
discounted future net cash flows are based upon projected cash flows that do not
provide for changes in oil and natural gas prices or for changes in expenses and
capital costs. The accuracy of such estimates is highly dependent upon the
accuracy of the assumptions upon which they were based. Actual results may
differ materially from the results estimated. Prospective purchasers of the
Shares are cautioned not to place undue reliance on the reserve data and
resulting cash flow estimates incorporated by reference in this Prospectus.

7
<PAGE> 25

The Company accounts for its oil and natural gas producing activities under
the full cost method. This method imposes certain limitations on the carrying
(book) value of proved oil and natural gas properties and requires a writedown
of such assets for accounting purposes if such limits are exceeded. The risk
that the Company will be required to write down the carrying value of its oil
and natural gas properties increases as oil and natural gas prices decline or
remain depressed. If a writedown is required, it would result in a non-cash
charge to earnings. In the past, the Company has not been required to write down
its oil and natural gas properties. However, no assurance can be given that the
Company will not be required to make such a writedown in the future.

REPLACEMENT OF RESERVES

HSR's future performance depends in part upon its ability to acquire, find
and develop additional oil and natural gas reserves that are economically
recoverable. Without successful acquisition, exploration or development
activities, HSR's reserves will decline. No assurance can be given that HSR will
be able to acquire or find and develop additional reserves on an economic basis.

HSR's business is capital intensive and, to maintain its asset base of
proved oil and natural gas reserves, a significant amount of cash flow from
operations must be reinvested in property acquisitions, development or
exploration activities. To the extent cash flow from operations is reduced and
external sources of capital become limited or unavailable, HSR's ability to make
the necessary capital investments to maintain or expand its asset base would be
impaired. Without such investment, HSR's oil and natural gas reserves would
decline.

HSR's strategy will include continued exploitation and exploration of its
existing properties and may include opportunistic acquisitions of other oil and
natural gas properties. The successful acquisition of producing properties
requires an assessment of recoverable reserves, future oil and natural gas
prices and operating costs, potential environmental and other liabilities and
other factors. Such assessments are necessarily inexact and their accuracy
inherently uncertain. There can be no assurance that HSR's acquisition
activities and exploration and development projects will result in increases in
reserves. HSR's operations may be curtailed, delayed or canceled as a result of
a lack of adequate capital and other factors, such as title problems, weather,
compliance with governmental regulations or price controls, mechanical
difficulties or shortages or delays in the delivery of equipment. Furthermore,
while HSR's revenues may increase if prevailing natural gas and oil prices
increase significantly, HSR's finding costs for additional reserves could also
increase. In addition, the costs of exploration and development may materially
exceed initial estimates.

RISKS OF HEDGING AND TRADING TRANSACTIONS

In order to manage its exposure to price risks in the marketing of its oil
and natural gas and in connection with its trading activities, HSR has in the
past entered and may in the future enter into oil and natural gas futures
contracts on the New York Mercantile Exchange ("NYMEX"), fixed price delivery
contracts and financial swaps. Those transactions that are intended to reduce
the effects of volatility of the price of oil and natural gas may limit
potential gains by HSR if oil and natural gas prices were to rise substantially
over the price established by the hedge. In addition, HSR's hedging and trading
may expose HSR to the risk of financial loss in certain circumstances, including
instances in which (i) production is less than expected, (ii) there is a
widening of price differentials between delivery points for HSR's production and
Henry Hub (in the case of NYMEX futures contracts) or delivery points required
by fixed price delivery contracts to the extent they differ from those of HSR's
production, (iii) HSR's customers or the counterparties to its futures contracts
fail to purchase or deliver the contracted quantities of oil or natural gas or
honor their financial commitments or (iv) a sudden, unexpected event materially
affects oil or natural gas prices. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources" incorporated by reference in this Prospectus.

GOVERNMENTAL AND ENVIRONMENTAL REGULATION

The Company's operations are subject to various Federal, state and local
governmental laws and regulations, which may be changed from time to time in
response to economic or political factors. Matters subject to

8
<PAGE> 26

regulation include, but are not limited to, drilling and operations permits and
approvals, performance bonds, reports concerning operations, discharge and other
permitting requirements, the spacing of wells, unitization and pooling of
properties and taxation.

The Company's operations are subject to complex and constantly changing
environmental laws and regulations adopted by Federal, state and local
governmental authorities. Compliance with such laws has not had a material
adverse effect upon the Company to date. Nevertheless, the discharge of oil,
natural gas or other pollutants into the air, soil or water may give rise to
significant liabilities of the Company to the government and/or third parties,
and may require the Company to incur substantial costs for remediation.
Moreover, the Company has agreed to indemnify certain sellers of producing
properties from whom the Company has acquired properties against certain
liabilities for environmental claims associated with the properties purchased by
the Company. No assurance can be given that existing environmental laws or
regulations, as currently interpreted or as may be in the future, or future laws
or regulations will not materially adversely affect the Company's results of
operations and financial condition or that material indemnity claims will not
arise against the Company with respect to properties acquired by the Company.

Recently there has been an increased level of regulation of oil and natural
gas activities in Colorado. For example, the Colorado Oil and Gas Conservation
Commission adopted, and is considering the adoption of additional, stricter
regulation of matters such as soil conservation, land reclamation, fluid
disposal and bonding of oil and natural gas companies. Additionally, various
cities and counties are currently reviewing their ordinances to determine the
level of regulatory authority, if any, they should assert over such matters. At
present, it cannot be determined to what degree stricter regulations, if
adopted, would adversely affect the Company's operations.

OPERATING HAZARDS; UNINSURED RISKS

The Company's operations are subject to hazards and risks inherent in
drilling for and production and transportation of oil and natural gas, such as
fires, natural disasters, explosions, encountering formations with abnormal
pressures, blowouts, cratering, pipeline failures and spills, any of which can
result in loss of hydrocarbons, environmental pollution, personal injury claims
and other damage or impacts to properties of the Company and others, including
suspension of operations. The business is also subject to environmental hazards
such as oil spills, natural gas leaks, ruptures and discharges of toxic natural
gases, which could expose the Company to substantial liability due to pollution
and other environmental damage. The Company's insurance coverages include, but
are not limited to, comprehensive general liability, automobile, personal
injury, bodily injury and property damage, pollution liability, physical damage
on certain assets, workers' compensation and control of well insurance. The
Company believes that its insurance is adequate and customary for companies of a
similar size engaged in operations similar to those of the Company, but losses
could occur for uninsurable or uninsured risks or in amounts in excess of
existing insurance coverage.

COMPETITION

The oil and natural gas industry is highly competitive. The Company
competes in the areas of property acquisitions and the development, production
and marketing of oil and natural gas with major oil companies, other independent
oil and natural gas concerns and individual producers and operators. The Company
also competes with major and independent oil and natural gas concerns in
recruiting and retaining qualified employees. Many of these competitors have
substantially greater financial and other resources than the Company.

USE OF PROCEEDS

The Company will not receive any of the net proceeds from the sale of the
Shares, and all of such proceeds will be received by the Selling Stockholder.

9
<PAGE> 27

SELLING STOCKHOLDER

The following table sets forth certain information regarding the beneficial
ownership of Common Stock as of June 20, 1997 by the Selling Stockholder, the
number of shares being offered by the Selling Stockholder and the number and
percentage of the outstanding shares to be owned by the Selling Stockholder
after this offering, assuming all of the Shares are sold.

<TABLE>
<CAPTION>
NUMBER OF SHARES
SHARES OF COMMON STOCK OFFERED HEREBY SHARES OF COMMON STOCK
BENEFICIALLY OWNED FOR STOCKHOLDER'S BENEFICIALLY OWNED
PRIOR TO OFFERING ACCOUNT AFTER THE OFFERING
----------------------- ----------------- -----------------------
NAME OF BENEFICIAL OWNER NUMBER PERCENTAGE NUMBER PERCENTAGE
------------------------ --------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C>
Natural Gas Partners, L.P..... 3,611,987(1) 19.64 2,864,225 747,762 4.36
</TABLE>

- ---------------

(1) Includes 740,262 shares subject to issuance within 60 days after June 20,
1997, upon the exercise of warrants and 7,500 shares subject to issuance
upon the exercise of options granted under the 1993 Directors' Plan to
Kenneth A. Hersh and subsequently assigned by him to the Selling
Stockholders.

Kenneth A. Hersh is a member of the board of directors of the Company and a
managing partner of the Selling Stockholder. The Selling Stockholder previously
acted as a subordinated lender to the Company. In consideration of such
financing, the Selling Stockholder acquired, and currently holds, two warrants
to purchase an aggregate of 740,262 shares of Common Stock at an exercise price
of from $6.67 to $10.00 per share. The warrants expire January 31, 2001.

On February 25, 1996, the Company entered into a merger agreement (the
"Merger Agreement") with Tide West Oil Company ("Tide West"). Pursuant to the
Merger Agreement, Tide West was merged into a wholly-owned subsidiary of the
Company. Pursuant to the Merger Agreement, the Merger was consummated in June
1996 following special shareholder meetings of the shareholders of the Company
and Tide West. The Selling Stockholder was Tide West's largest stockholder,
owning approximately 4,550,000 shares, or 46.49%, of the outstanding common
stock of Tide West. Three representatives of the Selling Stockholder were
members of Tide West's board of directors at the time of the Merger. The Company
and the Selling Stockholder entered into a voting agreement whereby the Selling
Stockholder agreed to vote its shares in Tide West in favor of approval of the
Merger Agreement. In consideration of this agreement, the Company agreed to take
such action as is required to appoint a designee of the Selling Stockholder to
the Company's board of directors following consummation of the Merger. Mr.
Hersh, already then a member of the Company's board, was not considered to be
the Selling Stockholder designee. Following the consummation of the Merger, the
Company's board took appropriate action to increase the number of authorized
directors to six, and appointed Mr. Philip B. Smith, a former director,
president and chief executive officer of Tide West, as the nominee of the
Selling Stockholder to the vacancy so created. Pursuant to an agreement entered
into between the Selling Stockholder and Tide West in 1995, the Selling
Stockholder received a fee in 1996 for financial services in the amount of
$150,000 upon consummation of the Merger. Currently, both Mr. Hersh and Mr.
Smith are directors of HSR.

Pursuant to a Registration Rights Agreement between the Company and the
Selling Stockholder dated June 17, 1996, which was entered into in connection
with the Merger, the Company agreed to cause the Registration Statement, of
which this Prospectus is a part, to be kept continuously effective for a period
ending not less than three years from the date of the Registration Rights
Agreement and thereafter until such time as the amount of Registrable Securities
(as defined therein) held by the Selling Stockholder, together with the Selling
Stockholder's affiliates, represents less than 10 percent of the then
outstanding Common Stock.

10
<PAGE> 28

PLAN OF DISTRIBUTION

The Shares may be sold from time to time to purchasers directly by the
Selling Stockholder. Alternatively, the Selling Stockholder may from time to
time offer the Shares through underwriters, dealers or agents, who may receive
compensation in the form of underwriting discounts, concessions or commissions
from the Selling Stockholder and/or the purchasers of the Shares for whom they
may act as agent. The Selling Stockholder and any underwriters, dealers or
agents that participate in the distribution of the Shares may be deemed to be
underwriters and any profit on the sale of the Shares by them and any discounts,
commissions or concessions received by any such underwriters, dealers or agents
might be deemed to be underwriting discounts and commissions under the
Securities Act. At the time a particular offer of shares is made, to the extent
required, a Prospectus Supplement will be distributed that will set forth the
specific shares to be sold and the terms of the offering, including the name or
names of any underwriters or dealer-agents, any discounts, commissions and other
items constituting compensation from the Selling Stockholder and any discounts,
commissions or concessions allowed or reallowed or paid to dealers.

The Shares may be sold from time to time in one or more transactions at a
fixed offering price that may be changed or at varying prices determined at the
time of sale or negotiated prices.

The Company has paid substantially all of the expenses incident to the
offering of the Shares, other than commissions and discounts of underwriters,
dealers or agents and the fees and expenses of counsel to the Selling
Stockholder.

VALIDITY OF SECURITIES

The validity of the Shares has been passed upon by Davis, Graham & Stubbs
LLP Denver, Colorado.

EXPERTS

The Consolidated Financial Statements of the Company included in its Annual
Report on Form 10-K for the year ended December 31, 1996 and incorporated by
reference in this Prospectus, to the extent and for the periods indicated in
their report, have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report dated February 24, 1997, with respect
thereto, and are incorporated by reference herein in reliance upon the authority
of said firm as experts in giving said report.

Estimates of historical oil and natural gas reserves of the Company as of
December 31, 1994 and 1995 incorporated by reference herein are based upon
engineering studies prepared by the Company and reviewed by the independent
petroleum engineering firms of Williamson Petroleum Consultants, Inc. and
Netherland, Sewell & Associates, Inc. Estimates of historical oil and natural
gas reserves of the Company as of December 31, 1996 incorporated by reference
herein are based upon engineering studies prepared by the Company. In the
aggregate, 78.4% of the Company's total reserves as of December 31, 1996 were
reviewed by the two engineering firms. Such estimates are incorporated by
reference herein in reliance upon the authority of such firms as experts in such
matters.

11
<PAGE> 29

================================================================================

NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY, THE SELLING STOCKHOLDER OR THE UNDERWRITERS. NEITHER THIS
PROSPECTUS SUPPLEMENT NOR THE ACCOMPANYING PROSPECTUS CONSTITUTES AN OFFER OF
ANY SECURITIES OTHER THAN THOSE TO WHICH THEY RELATE OR AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, TO ANY PERSON IN ANY JURISDICTION WHERE SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED
HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.

---------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Prospectus Supplement Summary.............. S-3
Summary Financial Data..................... S-5
Summary Operating and Reserve Data......... S-6
Use of Proceeds............................ S-7
Capitalization............................. S-7
Price Range of Common Stock and Dividend
Policy................................... S-8
Business and Properties.................... S-9
Selling Stockholder........................ S-15
Underwriting............................... S-16
Legal Matters.............................. S-17
PROSPECTUS
Available Information...................... 2
Incorporation of Certain Documents by
Reference................................ 3
The Company................................ 5
Risk Factors............................... 6
Use of Proceeds............................ 9
Selling Stockholder........................ 10
Plan of Distribution....................... 11
Validity of Securities..................... 11
Experts.................................... 11
</TABLE>

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1,850,010 Shares

HS RESOURCES, INC.

Common Stock

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PROSPECTUS SUPPLEMENT

October 9, 1997

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LEHMAN BROTHERS

MERRILL LYNCH & CO.

PETRIE PARKMAN & CO.

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