<PAGE>
AMENDMENT NO. 1 TO
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________________ to __________________
Commission File number: 0-21610
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Texas 76-6078395
(State or other jurisdiction of organization) (I.R.S. Employer Identification No.)
</TABLE>
16825 Northchase Drive, Suite 400
Houston, Texas 77060
(Address of principal executive offices)
(Zip Code)
(281)874-2700
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE
<S> <C>
ITEM 1. Financial Statements
Balance Sheets
- September 30, 1999 and December 31, 1998 3
Statements of Operations
- Three month and nine month periods ended September 30, 1999 and 1998 4
Statements of Cash Flows
- Nine month periods ended September 30, 1999 and 1998 5
Notes to Financial Statements 6
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION 11
SIGNATURES 12
</TABLE>
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
--------------- ---------------
(Unaudited)
<S> <C> <C>
ASSETS:
Current Assets:
Cash and cash equivalents $ 266,535 $ 211,622
Oil and gas sales receivable 330,034 307,405
Receivable due to property disposition -- 136,838
Other 23,699 17,653
--------------- ---------------
Total Current Assets 620,268 673,518
--------------- ---------------
Gas Imbalance Receivable 312,851 351,495
--------------- ---------------
Oil and Gas Properties, using full cost
accounting 9,084,145 9,064,596
Less-Accumulated depreciation, depletion
and amortization (7,755,253) (7,612,087)
--------------- ---------------
1,328,892 1,452,509
=============== ===============
$ 2,262,011 $ 2,477,522
=============== ===============
LIABILITIES AND PARTNERS' CAPITAL:
Current Liabilities:
Accounts Payable $ 88,010 $ 117,240
--------------- ---------------
Deferred Revenues 372,644 401,888
Interest Holders' Capital (8,631,378 Interest Holders'
SDIs; $1.00 per SDI) 1,757,283 1,919,030
General Partners' Capital 44,074 39,364
--------------- ---------------
Total Partners' Capital 1,801,357 1,958,394
=============== ===============
$ 2,262,011 $ 2,477,522
=============== ===============
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------------- ---------------------------------
1999 1998 1999 1998
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
REVENUES:
Oil and gas sales $ 205,934 $ 182,959 $ 480,375 $ 609,958
Interest income 4,293 4,670 12,382 12,619
Other -- -- -- 3,354
-------------- -------------- -------------- --------------
210,227 187,629 492,757 625,931
-------------- -------------- -------------- --------------
COSTS AND EXPENSES:
Lease operating 65,904 68,052 191,101 229,746
Production taxes 12,701 11,724 30,247 37,116
Depreciation, depletion
and amortization 50,057 73,827 143,166 235,794
General and administrative 29,450 28,902 107,071 102,953
-------------- -------------- -------------- --------------
158,112 182,505 471,585 605,609
============== ============== ============== ==============
NET INCOME (LOSS) $ 52,115 $ 5,124 $ 21,172 $ 20,322
============== ============== ============== ==============
Limited Partners' net income (loss)
per SDI $ -- $ -- $ -- $ --
============== ============== ============== ==============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-------------------------------------
1999 1998
--------------- ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Income (loss) $ 21,172 $ 20,322
Adjustments to reconcile income (loss) to
net cash provided by operations:
Depreciation, depletion and amortization 143,166 235,794
Change in gas imbalance receivable
and deferred revenues 9,400 (18,058)
Change in assets and liabilities:
(Increase) decrease in oil and gas sales receivable (22,629) 121,779
(Increase) decrease in other current assets (6,046) (7,417)
Increase (decrease) in accounts payable (29,230) (17,426)
--------------- ---------------
Net cash provided by (used in) operating activities 115,833 334,994
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to oil and gas properties (19,715) (47,819)
Proceeds from sales of oil and gas properties 137,004 254,264
--------------- ---------------
Net cash provided by (used in) investing activities 117,289 206,445
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash Distributions to partners (178,209) (577,427)
--------------- ---------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 54,913 (35,988)
--------------- ---------------
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 211,622 255,689
=============== ===============
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 266,535 $ 219,701
=============== ===============
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) General Information -
The financial statements included herein have been prepared by
the Partnership and are unaudited except for the balance sheet at
December 31, 1998 which has been taken from the audited financial
statements at that date. The financial statements reflect adjustments,
all of which were of a normal recurring nature, which are, in the
opinion of the managing general partner necessary for a fair
presentation. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to the rules
and regulations of the Securities and Exchange Commission ("SEC"). The
Partnership believes adequate disclosure is provided by the information
presented. The financial statements should be read in conjunction with
the audited financial statements and the notes included in the latest
Form 10-K.
(2) Organization and Terms of Partnership Agreement -
Swift Energy Operating Partners 1992-B, Ltd., a Texas limited
partnership ("the Partnership"), was formed on June 30, 1992, for the
purpose of purchasing and operating producing oil and gas properties
within the continental United States and Canada. Swift Energy Company
("Swift"), a Texas corporation, and VJM Corporation ("VJM"), a
California corporation, serve as Managing General Partner and Special
General Partner of the Partnership, respectively. The sole limited
partner of the Partnership is Swift Depositary Company, which has
assigned all of its beneficial (but not of record) rights and interest
as limited partner to the investors in the Partnership ("Interest
Holders"), in the form of Swift Depositary Interests ("SDIs").
The Managing General Partner has paid or will pay out of its
own corporate funds (as a capital contribution to the Partnership) all
selling commissions, offering expenses, printing, legal and accounting
fees and other formation costs incurred in connection with the offering
of SDIs and the formation of the Partnership, for which the Managing
General Partner will receive an interest in continuing costs and
revenues of the Partnership. The 585 Interest Holders made total capital
contributions of $8,631,378.
Generally, all continuing costs (including development costs,
operating costs, general and administrative reimbursements and direct
expenses) and revenues are allocated 85 percent to the Interest Holders
and 15 percent to the general partners. After partnership payout, as
defined in the Partnership Agreement, continuing costs and revenues will
be shared 75 percent by the Interest Holders, and 25 percent by the
general partners.
(3) Significant Accounting Policies -
Use of Estimates --
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from estimates.
Oil and Gas Revenues -
Oil and gas revenues are reported using the entitlement method
in which the Partnership recognizes its interest in oil and natural gas
production as revenue.
Oil and Gas Properties --
The Partnership accounts for its ownership interest in oil and
gas properties using the proportionate consolidation method, whereby the
Partnership's share of assets, liabilities, revenues and expenses is
included in the appropriate classification in the financial statement.
6
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
For financial reporting purposes the Partnership follows the
"full-cost" method of accounting for oil and gas property costs. Under
this method of accounting, all productive and nonproductive costs
incurred in the acquisition and development of oil and gas reserves are
capitalized. Such costs include lease acquisitions, geological and
geophysical services, drilling, completion, equipment and certain
general and administrative costs directly associated with acquisition
and development activities. General and administrative costs related to
production and general overhead are expensed as incurred. No general and
administrative costs were capitalized during the nine months ended
September 30, 1999 and 1998.
Future development, site restoration, dismantlement and
abandonment costs, net of salvage values, are estimated on a
property-by-property basis based on current economic conditions and are
amortized to expense as the Partnership's capitalized oil and gas
property costs are amortized.
The unamortized cost of oil and gas properties is limited to
the "ceiling limitation" (calculated separately for the Partnership,
limited partners and general partners). The "ceiling limitation" is
calculated on a quarterly basis and represents the estimated future net
revenues from proved properties using current prices, discounted at ten
percent, and the lower of cost or fair value of unproved properties.
Proceeds from the sale or disposition of oil and gas properties are
treated as a reduction of oil and gas property costs with no gains or
losses being recognized except in significant transactions.
The Partnership computes the provision for depreciation,
depletion and amortization of oil and gas properties on the
units-of-production method. Under this method, the provision is
calculated by multiplying the total unamortized cost of oil and gas
properties, including future development, site restoration,
dismantlement and abandonment costs, by an overall amortization rate
that is determined by dividing the physical units of oil and gas
produced during the period by the total estimated units of proved oil
and gas reserves at the beginning of the period.
The calculation of the "ceiling limitation" and the provision
for depreciation, depletion and amortization is based on estimates of
proved reserves. There are numerous uncertainties inherent in estimating
quantities of proved reserves and in projecting the future rates of
production, timing and plan of development. The accuracy of any reserve
estimate is a function of the quality of available data and of
engineering and geological interpretation and judgment. Results of
drilling, testing and production subsequent to the date of the estimate
may justify revision of such estimate. Accordingly, reserve estimates
are often different from the quantities of oil and gas that are
ultimately recovered.
(4) Related-Party Transactions -
Effective June 30, 1992, the Partnership entered into a Net
Profits and Overriding Royalty Interest Agreement ("NP/OR Agreement")
with Swift Energy Pension Partners 1992-B, Ltd. ("Pension Partnership"),
an affiliated partnership managed by Swift for the purpose of acquiring
nonoperating interests in producing oil and gas properties. Under the
terms of the NP/OR Agreement, the Partnership will convey to the Pension
Partnership a nonoperating interest in the aggregate net profits (i.e.,
oil and gas sales net of related operating costs) of the properties
acquired equal to the Pension Partnership's proportionate share of the
property acquisition costs.
(5) Gas Imbalances -
The Partnership recognizes its ownership interest in natural
gas production as revenue. Actual production quantities sold may be
different than the Partnership's ownership share in a given period. If
the Partnership's sales exceed its ownership share of production, the
differences are recorded as deferred revenue. Gas balancing receivables
are recorded when the Partnership's ownership share of production
exceeds sales.
(6) Vulnerability Due to Certain Concentrations -
The Partnership's revenues are primarily the result of sales
of its oil and natural gas production. Market prices of oil and natural
gas may fluctuate and adversely affect operating results.
7
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
In the normal course of business, the Partnership extends
credit, primarily in the form of monthly oil and gas sales receivables,
to various companies in the oil and gas industry which results in a
concentration of credit risk. This concentration of credit risk may be
affected by changes in economic or other conditions and may accordingly
impact the Partnership's overall credit risk. However, the Managing
General Partner believes that the risk is mitigated by the size,
reputation, and nature of the companies to which the Partnership extends
credit. In addition, the Partnership generally does not require
collateral or other security to support customer receivables.
(7) Fair Value of Financial Instruments -
The Partnership's financial instruments consist of cash and
cash equivalents and short-term receivables and payables. The carrying
amounts approximate fair value due to the highly liquid nature of the
short-term instruments.
(8) Year 2000 -
The Year 2000 issue results from computer programs and
embedded computer chips with date fields that cannot distinguish between
the years 1900 and 2000. The Managing General Partner has implemented
the steps necessary to make its operations and the related operations of
the Partnership capable of addressing the Year 2000. These steps
included upgrading, testing and certifying its computer systems and
field operation services and obtaining Year 2000 compliance
certification from all important business suppliers. The Managing
General Partner formed a task force during 1998 to address the Year 2000
issue and prepare its business systems for the Year 2000. The Managing
General Partner has either replaced or updated mission critical systems
and has substantially completed testing and will continue remedial
actions as needed.
The Managing General Partner's business systems are almost
entirely comprised of off-the-shelf software. Most of the necessary
changes in computer instructional code were made by upgrading this
software. In addition, the Managing General Partner has received
certification as to Year 2000 compliance from vendors or third party
consultants.
The Managing General Partner does not believe that costs
incurred to address the Year 2000 issue with respect to its business
systems will have a material effect on the Partnership's results of
operations, or its liquidity and financial condition. The estimated
total cost to the Managing General Partner to address Year 2000 issues
is projected to be less than $150,000, most of which was spent during
the testing phase. The Partnership's share of this cost is expected to
be insignificant.
The failure to correct a material Year 2000 problem could
result in an interruption, or failure of certain normal business
activities or operations. Based on activities to date, the Managing
General Partner believes that it has resolved any Year 2000 problems
concerning its financial and administrative systems. It is
undeterminable how all the aspects of the Year 2000 will impact the
Partnership. The most reasonably likely worst case scenario would
involve a prolonged disruption of external power sources upon which core
equipment relies, resulting in a substantial decrease in the
Partnership's oil and gas production activities. In addition, the
pipeline operators to whom the Managing General Partner sells the
Partnership's natural gas, as well as other customers and suppliers,
could be prone to Year 2000 problems that could not be assessed or
detected by the Managing General Partner. The Managing General Partner
has contacted its major purchasers, customers, suppliers, financial
institutions and others with whom it conducts business to determine
whether they will be able to resolve in a timely manner any Year 2000
problems directly affecting the Managing General Partner or Partnership
and to inform them of the Managing General Partner's internal assessment
of its Year 2000 review. There can be no assurance that such third
parties will not fail to appropriately address their Year 2000 issues or
will not themselves suffer a Year 2000 disruption that could have a
material adverse effect on the Partnership's activities, financial
condition or operating results. Based upon these responses and any
problems that arise, contingency plans or back-up systems would be
determined and addressed.
8
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Partnership was formed for the purpose of investing in producing oil
and gas properties located within the continental United States and Canada. In
order to accomplish this, the Partnership goes through two distinct yet
overlapping phases with respect to its liquidity and result of operations. When
the Partnership is formed, it commences its "acquisition" phase, with all funds
placed in short-term investments until required for such property acquisitions.
The interest earned on these pre-acquisition investments becomes the primary
cash flow source for initial Interest Holder distributions. As the Partnership
acquires producing properties, net cash from operations becomes available for
distribution, along with the investment income. After partnership funds have
been expended on producing oil and gas properties, the Partnership enters its
"operations" phase. During this phase, oil and gas sales generate substantially
all revenues, and distributions to partners or Interest Holders reflect those
revenues less all associated partnership expenses. The Partnership may also
derive proceeds from the sale of acquired oil and gas properties, when the sale
of such properties is economically appropriate or preferable to continued
operation.
LIQUIDITY AND CAPITAL RESOURCES
Oil and gas reserves are depleting assets and therefore often experience
significant production declines each year from the date of acquisition through
the end of the life of the property. The primary source of liquidity to the
Partnership comes almost entirely from the income generated from the sale of oil
and gas produced from ownership interests in oil and gas properties. This source
of liquidity and the related results of operations, and in turn cash
distributions, will decline in future periods as the oil and gas produced from
these properties also declines while production and general and administrative
costs remain relatively stable making it unlikely that the Partnership will hold
the properties until they are fully depleted, but will likely liquidate when a
substantial majority of the reserves have been produced. Cash distributions to
partners or Interest Holders are determined quarterly, based upon net proceeds
from sale of oil and gas production after payment of lease operating expense,
taxes and development costs, less general and administrative expenses. In
addition, future partnership cash requirements are taken into account to
determine necessary cash reserves.
Net cash provided by operating activities totaled $115,833 and $334,994
for the nine months ended September 30, 1999 and 1998, respectively. The
decrease in cash provided by operating activities in 1999 is related to changes
in oil and gas sales receivable and declines in the Partnership's production
from property sales in 1998. Cash provided by property sale proceeds totaled
$137,004 and $254,264 for the nine months ended September 30, 1999 and 1998,
respectively. Cash distributions totaled $178,209 and $577,427 for the nine
months ended September 30, 1999 and 1998, respectively. In 1999, cash
distributions were effected by production declines from the Partnership's
property sales in 1998 and low oil and gas prices received during the first part
of this year.
The Partnership has expended all of the partners' net commitments
available for property acquisitions and development by acquiring producing oil
and gas properties. The partnership invests primarily in proved producing
properties with nominal levels of future costs of development for proven but
undeveloped reserves. Significant purchases of additional reserves or extensive
drilling activity are not anticipated. The Partnership does not allow for
additional assessments from the partners or Interest Holders to fund capital
requirements. However, funds are available from partnership revenues, borrowings
or proceeds from the sale of partnership property. The Managing General Partner
believes that the funds currently available to the Partnership will be adequate
to meet any anticipated capital requirements.
RESULTS OF OPERATIONS
The following analysis explains changes in the revenue and expense
categories for the quarter ended September 30, 1999 (current quarter) when
compared to the quarter ended September 30, 1998 (corresponding quarter), and
for the nine months ended September 30, 1999 (current period), when compared to
the nine months ended September 30, 1998 (corresponding period).
9
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Three Months Ended September 30, 1999 and 1998
Oil and gas sales increased $22,974 or 13 percent in the third quarter of
1999 when compared to the corresponding quarter in 1998, primarily due to
increased oil and gas prices. Oil prices increased 147 percent or $10.92/BBL to
an average of $18.36/BBL and gas prices increased 33 percent or $.64/MCF to an
average of $2.61/MCF for the quarter. Increased oil and gas prices helped offset
the effect of decreased production. Current quarter production volumes decreased
23 percent as oil and gas production declined 22 percent and 23 percent,
respectively, when compared to third quarter 1998 production volumes. Production
declines are related to normal depletion and partially to the Partnership's
property sales in 1998.
Corresponding production costs per equivalent MCF increased 27 percent in
the third quarter of 1999 compared to the third quarter of 1998 and total
production remained flat.
Associated depreciation expense decreased 32 percent or $23,770 in 1999
compared to third quarter 1998.
Nine Months Ended September 30, 1999 and 1998
Oil and gas sales declined $129,583 or 21 percent in the first nine months
of 1999 when compared to the corresponding period in 1998, primarily due to
decreased oil and gas production. Current period production volumes decreased 35
percent as oil and gas production declined 35 percent and 34 percent,
respectively, when compared to the same period in 1998. Production declines are
related to normal depletion and partially to the Partnership's property sales in
1998. Oil prices increased 63 percent or $5.53/BBL to an average of $14.38/BBL
and gas prices increased 7 percent or $.15/MCF to an average of $2.21/MCF for
the current period. Increased oil and gas prices helped offset the effect of
decreased production.
Corresponding production costs per equivalent MCF increased 27 percent in
the first nine months of 1999 compared to the corresponding period in 1998 and
total production costs decreased 17 percent.
Associated depreciation expense decreased 39 percent or $92,628 in 1999
compared to the first nine months of 1998.
During 1999, partnership revenues and costs will be shared between the
Interest Holders and general partners in an 85:15 ratio.
10
<PAGE>
SWIFT ENERGY OPERATING PARTNERS 1992-B, LTD.
PART II - OTHER INFORMATION
ITEM 5. OTHER INFORMATION
-NONE-
11
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Amendment No. 1 to Form 10-Q of
Swift Energy Operating Partners 1992-B, Ltd. for the third quarter of 1999 to be
signed on its behalf by the undersigned thereunto duly authorized.
SWIFT ENERGY OPERATING
PARTNERS 1992-B, LTD.
(Registrant)
By: SWIFT ENERGY COMPANY
Managing General Partner
Date: January 20, 2000 By: /s/ John R. Alden
---------------- ----------------------------------------
John R. Alden
Senior Vice President, Secretary
and Principal Financial Officer
Date: January 20, 2000 By: /s/ Alton D. Heckaman, Jr.
---------------- ----------------------------------------
Alton D. Heckaman, Jr.
Vice President, Controller
and Principal Accounting Officer
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Swift Energy
Operating Partners 1992-B Ltd.'s balance sheet and statement of operations
contained in its Form 10-Q for the quarter ended September 30, 1999 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 266,535
<SECURITIES> 0
<RECEIVABLES> 330,034
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 620,268
<PP&E> 9,084,145
<DEPRECIATION> (7,755,253)
<TOTAL-ASSETS> 2,262,011
<CURRENT-LIABILITIES> 88,010
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,801,357
<TOTAL-LIABILITY-AND-EQUITY> 2,262,011
<SALES> 480,375
<TOTAL-REVENUES> 492,757
<CGS> 0
<TOTAL-COSTS> 364,514<F1>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 21,172
<INCOME-TAX> 0
<INCOME-CONTINUING> 21,172
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 21,172
<EPS-BASIC> 0
<EPS-DILUTED> 0
<FN>
<F1>Includes lease operating expenses, production taxes and depreciation,
depletion and amortization expense. Excludes general and administrative and
interest expense.
</FN>
</TABLE>
