================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT UNDER 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 1-11748
EASTERN AMERICAN NATURAL GAS TRUST
(Exact name of registrant as specified in its charter)
DELAWARE 36-7034603
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
BANK OF MONTREAL TRUST COMPANY
C/O HARRIS TRUST AND SAVINGS BANK
311 W. MONROE STREET, 12TH FLOOR
CHICAGO, ILLINOIS 60606
(Address of principal executive offices)
(Zip Code)
(312) 461-4662
(Registrant's telephone number, including area code)
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>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
EASTERN AMERICAN NATURAL GAS TRUST
STATEMENTS OF DISTRIBUTABLE INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
--------------------------- ---------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Royalty Income: .............................. $ 7,226,696 $ 7,742,352 $ 2,635,979 $ 2,524,430
Operating Expenses:
Taxes on production and property .......... 493,517 531,814 183,244 172,346
Operating cost charges .................... 370,320 355,884 122,782 118,254
----------- ----------- ----------- -----------
Total Operating Expenses ............... 863,837 887,698 306,026 290,600
----------- ----------- ----------- -----------
Net Proceeds to the Trust .................... 6,362,859 6,854,654 2,329,953 2,233,830
General and Administrative Expenses .......... (377,875) (349,007) (99,118) (93,385)
Interest income .............................. 4,509 5,513 1,529 1,858
Cash Proceeds on Sale of Net Profits Interests 503,434 838,474 220,490 0
----------- ----------- ----------- -----------
Distributable Income ................... $ 6,492,927 $ 7,349,634 $ 2,452,854 $ 2,142,303
=========== =========== =========== ===========
Distributable Income Per Unit (5,900,000
units authorized and outstanding) ........ $ 1.1005 $ 1.2457 $ 0.4157 $ 0.3631
=========== =========== =========== ===========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
EASTERN AMERICAN NATURAL GAS TRUST
STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS
SEPTEMBER 30, 1999 DECEMBER 31, 1998
------------------ -----------------
(UNAUDITED)
Assets:
Cash ................................ $ 1,529 $ 1,483
Net Proceeds Receivable ............. 2,550,443 2,187,489
Net Profits Interests in Gas
Properties ..................... 93,162,180 93,162,180
Accumulated Amortization ....... (38,679,262) (34,341,682)
------------ ------------
Total Assets ................... $ 57,034,890 $ 61,009,470
============ ============
Liabilities and Trust Corpus:
Trust General and Administrative
Expenses Payable ............... $ 99,118 $ 115,930
Distributions Payable ............... 2,452,854 2,073,042
Trust Corpus (5,900,000 Trust Units
authorized and outstanding) .... 54,482,918 58,820,498
------------ ------------
Total Liabilities and Trust
Corpus ....................... $ 57,034,890 $ 61,009,470
============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
EASTERN AMERICAN NATURAL GAS TRUST
STATEMENT OF CHANGES IN TRUST CORPUS
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, 1999 SEPTEMBER 30, 1998
------------------ ------------------
<S> <C> <C>
Trust Corpus, Beginning of Period ........ $ 58,820,498 $ 64,315,517
Distributable Income ..................... 6,492,927 7,349,634
Distributions Payable to Unitholders ..... (6,492,927) (7,349,634)
Amortization of Net Profits Interests in
Gas Properties ...................... (4,337,580) (4,142,530)
------------ ------------
Trust Corpus, End of Period .............. $ 54,482,918 $ 60,172,987
============ ============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
2
<PAGE>
EASTERN AMERICAN NATURAL GAS TRUST
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1. Organization of the Trust
The Eastern American Natural Gas Trust (the "Trust") was formed under the
Delaware Business Trust Act pursuant to a Trust Agreement (the "Trust
Agreement") among Eastern American Energy Corporation ("Eastern American"), as
grantor, Bank of Montreal Trust Company, as Trustee ("Trustee"), and Wilmington
Trust Company, as Delaware Trustee (the "Delaware Trustee"). The Trust was
formed to acquire and hold net profits interests (the "Net Profits Interests")
created from the working interests owned by Eastern American in 650 producing
gas wells and 65 proved development well locations in West Virginia and
Pennsylvania (the "Underlying Properties"). The Net Profits Interests consisted
of a royalty interest in 322 wells and a term interest in the remaining wells
and locations. Prior to or on May 15, 2013, the Trustee is required to sell the
royalty interests and liquidate the Trust.
On March 15, 1993, 5,900,000 Depositary Units were issued in a public
offering at an initial public offering price of $20.50 per Depositary Unit. Each
Depositary Unit consists of beneficial ownership of one unit of beneficial
interest ("Trust Unit") in the Trust and a $20 face amount beneficial ownership
interest in a $1,000 face amount zero coupon United States Treasury Obligation
("Treasury Obligation") maturing on May 15, 2013.
The Net Profits Interests are passive in nature, and neither the Trustee nor
the Delaware Trustee has management control or authority over, nor any
responsibility relating to, the operation of the properties subject to the Net
Profits Interests. The Trust Agreement provides, among other things, that the
Trust shall not engage in any business or commercial activity or acquire any
asset other than the Net Profits Interests initially conveyed to the Trust; the
Trustee may establish a reserve for payment of any liability which is
contingent, uncertain in amount or that is not currently due and payable; the
Trustee is authorized to borrow funds required to pay liabilities of the Trust,
provided that such borrowings are repaid in full prior to further distributions
to Unitholders; and the Trustee will make quarterly cash distributions to
Unitholders from funds of the Trust.
NOTE 2. Basis of Presentation
The information furnished is based upon certain estimates of production for
the periods presented and is therefore subject to adjustment in future periods
to reflect actual production for the periods presented. The information
furnished reflects all adjustments which are, in the opinion of the Trustee,
necessary for a fair presentation of the results for the interim periods
presented. The accompanying financial statements are unaudited interim financial
statements, and should be read in conjunction with the audited financial
statements and notes thereto included in the Trust's Annual Report on Form 10-K
for the year ended December 31, 1998.
3
<PAGE>
EASTERN AMERICAN NATURAL GAS TRUST
NOTES TO UNAUDITED FINANCIAL STATEMENTS - (CONTINUED)
NOTE 3. Trust Accounting Policies
The Trust serves as a pass-through entity, with items of depletion, interest
income and expense, and income tax attributes being based upon the status and
elections of Unitholders. Thus, the Statements of Distributable Income show
Distributable Income, defined as Trust income available for distribution to
Unitholders before application of those Unitholders' additional expenses, if
any, for depletion, interest expense, and income taxes. The Trust uses the
accrual basis to recognize revenue, with Royalty Income recorded as income as
reserves are extracted from properties and sold. Expenses are also presented on
an accrual basis. Actual cash receipts will vary from the accrual of revenues
due to, among other reasons, the payment provisions of the gas purchase contract
between the Trust and Eastern Marketing Corporation (a subsidiary of Eastern
American), which requires payment with respect to gas production for a calendar
quarter to be made to the Trust on or before the tenth day of the third month
following such quarter.
Net Profits Interests in Gas Properties are periodically assessed to
determine whether their net capitalized cost is impaired. The Trust will
determine if a writedown is necessary to its investment in the Net Profits
Interests in gas properties to the extent that total capitalized costs, less
accumulated amortization, exceed undiscounted future net revenues attributable
to proved gas reserves of the Underlying Properties. The Trust will then provide
a writedown to the extent that the net capitalized costs exceed the discounted
future net revenues attributable to proved gas reserves of the Underlying
Properties. Any such writedown would not reduce distributable income, although
it would reduce Trust Corpus.
Amortization of the Net Profits Interests in Gas Properties is calculated on
a units-of-production basis, whereby the Trust's cost basis in the properties is
divided by total Trust reserves to derive an amortization rate per reserve unit.
Such amortization does not reduce distributable income, but does reduce Trust
Corpus.
NOTE 4. Income Taxes
The Trust is a grantor trust and is not required to pay federal or state
income taxes. Accordingly, no provision for federal or state income taxes has
been made. All income is taxed to the Unitholders of the Trust.
4
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Year 2000
The Year 2000 problem refers to the inability of certain computer and other
information technology systems to properly process date and time information
after December 31, 1999. The problem was caused, in part, by the programming
practice of using two digits rather than four to represent the year in a date.
The consequence of the Year 2000 problem, in general, is that information
technology and embedded processing systems are at risk of malfunction after
December 31, 1999, and potentially at dates prior to December 31, 1999.
The Trust is a passive legal entity, and neither owns nor directly uses any
computer systems, accounting systems or other assets that might have embedded
Year 2000 problems, and consequently will not incur any costs or expense to
prevent any such problems. However, the Trust is dependent on Eastern American
and its systems for the calculation of amounts payable to the Trust and for the
actual payment of such amounts. Eastern American has informed the Trustee that
Eastern American has completed its Year 2000 assessment of its key business
information systems and is taking the necessary steps to ensure its systems will
be compliant by the year 2000. According to Eastern American, it is modifying
its present operating and applications systems to eliminate Year 2000 problems.
Eastern American has substantially completed this modification and is expected
to be accomplished entirely by the end of November 1999. Simultaneously, Eastern
American is also implementing a new integrated application software package that
is estimated to be operational during the first quarter of 2000, but this
implementation is not critical to the Year 2000 readiness of Eastern American.
For further information regarding Eastern American's Year 2000 issues and the
status of its Year 2000 compliance program, reference is hereby made to the most
recent reports filed by Energy Corporation of America with the Securities and
Exchange Commission pursuant to the Securities and Exchange Act of 1934, as
amended.
Eastern Marketing purchases and resells gas from the properties in which the
Trust has an interest to a variety of purchasers, and consequently is dependent
upon those purchasers to perform their obligations to pay for gas purchased.
Eastern American is also dependent upon the various pipeline systems that
transport gas produced from the wellheads to the purchasers. A failure of the
transportation system or of purchasers of a material portion of such gas to make
payment for such gas could have a material adverse effect on the Trust. Eastern
American has informed the Trustee that Eastern American has completed the
process of soliciting information regarding Year 2000 readiness from the
companies Eastern American considers material to its business. Based on
information received thus far, Eastern American is not aware of any third-party
Year 2000 problem that is reasonably likely to be material to the Trust.
Although Eastern American is in the process of requesting this information,
Eastern American does not have the ability to require responses to such requests
or to independently verify their accuracy. Year 2000 related failures by Eastern
American's customers or vendors could have a material adverse effect on the
Trust.
In addition, the Trust is dependent on the Trustee for the maintenance of
records reflecting the
5
<PAGE>
ownership of the Units and for the payment to the Unitholders of quarterly
distributions received from Eastern American. The Trustee has informed the Trust
that its "systems and other date sensitive assets have been updated to manage
the Year 2000 date issue seamlessly, and the Trustee anticipates that the
transition will be a non-event for its customers." For further information
regarding the Trustee's Year 2000 issues and the status of its Year 2000
compliance program, reference is hereby made to the most recent reports filed by
Harris Bankcorp, Inc. with the Securities and Exchange Commission pursuant to
the Securities and Exchange Act of 1934, as amended.
General
The Trust does not conduct any operations or activities. The Trust's purpose
is, in general, to hold the Net Profits Interests, to distribute to Unitholders
cash which the Trust receives in respect of the Net Profits Interests (net of
Trust expenses), and to perform certain administrative functions in respect of
the Net Profits Interests and the Depositary Units. Accordingly, the Trust
derives substantially all of its income and cash flows from the Net Profits
Interests. The Trust has no source of liquidity or capital resources other than
the cash flows from the Net Profits Interests.
The Net Profits Interests were created pursuant to conveyances (the
"Conveyances") from Eastern American to the Trust. In connection therewith,
Eastern American assigned its rights under a gas purchase contract (the "Gas
Purchase Contract") which obligates Eastern Marketing Corporation, a subsidiary
of Eastern American, to purchase all of the natural gas produced from the
Underlying Properties which is attributable to the Net Profits Interests.
The Conveyances and the Gas Purchase Contract entitle the Trust to receive an
amount of cash for each calendar quarter equal to the Net Proceeds for such
quarter. "Net Proceeds" for any calendar quarter generally means an amount of
cash equal to (a) 90% of a volume of gas equal to (i) the volume of gas produced
during such quarter attributable to the Underlying Properties less (ii) a volume
of gas equal to "Chargeable Costs" for such quarter, multiplied by (b) the
applicable price for such quarter under the Gas Purchase Contract. "Chargeable
Costs" is that volume of gas which equates in value, determined by reference to
the relevant sales price under the Gas Purchase Contract or the Conveyances, as
applicable, to the sum of the "Operating Cost Charge", "Capital Costs" and
"Taxes". The "Operating Cost Charge" for 1998 was based on an annual rate of
$476,764, and for 1999 this annual rate is $496,656. In subsequent years, the
Operating Cost Charge will escalate, based on increases in the index of average
weekly earnings of Crude Petroleum and Gas Production Workers (published by the
United States Department of Labor, Bureau of Labor Statistics), but not more
than 5% per year. The Operating Cost Charge was not increased as Development
Wells were completed but will be reduced for each well that is sold (free of the
Net Profits Interests) or plugged and abandoned. "Capital Costs" means Eastern
American's working interest share of capital costs for operations on the
Underlying Properties, but only for items having a useful life of at least three
years, and not including any capital costs incurred in drilling the Development
Wells. "Taxes" means ad valorem taxes, production and severance taxes, and other
taxes imposed on the Trust's interest in the Underlying Properties, or
production therefrom.
6
<PAGE>
Pursuant to the Gas Purchase Contract, Eastern Marketing Corporation is
obligated to purchase such gas production, on a quarterly basis, at a purchase
price per Mcf, subject to certain adjustments, equal to the greater of the Index
Price or the Floor Price for gas produced during the seven-year period ending
December 31, 1999 (the "Primary Term") and at a purchase price per Mcf equal to
the Index Price thereafter. The Floor Price was $2.84 per Mcf for 1998 and shall
be $3.09 per Mcf for 1999, in each case subject to adjustment under certain
circumstances. The Index Price for any quarter during the Primary Term will be a
weighted average price determined by reference to the fixed price ("Fixed
Price") component, which will be given a 66 2/3% weight, and a variable price
("Variable Price") component, which will be given a 33 1/3% weight. Following
the Primary Term, the Index Price will be determined solely by reference to the
Variable Price. The Fixed Price was equal to $3.39 per Mcf for 1998, and
escalates at 5% for each year thereafter through December 31, 1999 at which time
the "Primary Term" expires and the "Fixed Price" terminates. The fixed price for
1999 is $3.56 per Mcf. The Variable Price is equal to the Henry Hub Average Spot
Price (as defined) plus $.30 per MMBtu, multiplied by 110% to effect a fixed
adjustment for Btu content. The Henry Hub Average Spot Price for any quarter is
a price per MMBtu based on a 12-month average settlement price of the gas
futures contracts for gas delivered to the Henry Hub (Henry, Louisiana).
Eastern American had a disagreement with the Trust over Eastern American's
obligation to drill certain Development Wells that were closely offset by third
parties. The Trust agreed that in lieu of drilling these closely offset
Development Wells that Eastern American could provide the Trust, on an annual
basis commencing on April 1, 1997, and over the remaining life of the Trust, a
volume of gas which is equal to the projected volumes of the wells as if they
had been drilled. These volumes have been estimated by Ryder Scott Company,
independent petroleum engineers. During the quarter ended September 30, 1999, an
additional volume of 7,820 Mcf was delivered to the Trust as compared to 9,935
Mcf for the quarter ended September 30, 1998. For the nine months ended
September 30, 1999, an additional volume of 25,575 Mcf was delivered to the
Trust as compared to 30,435 Mcf for the nine months ended Septemmber 30, 1998.
These additional volumes fulfill Eastern American's obligation to provide
volumes for Development Wells that had been closely offset by third parties.
Eastern American has fulfilled its obligation with respect to the drilling
of the Development Wells. Since the inception of the Trust, Eastern has drilled
a total of 59 Development Wells which are online and producing. (See the Trust's
Form 10-K for the fiscal year ended December 31, 1998 for a more complete
description of the Development Wells.)
During the quarter ended September 30, 1999, Eastern American received
consideration for four (4) wells in which the Trust owns a Net Profits Interest
that were required to be plugged and abandoned by the coal lessee of the
property upon which the wells were drilled since the wells interfered with
proposed mining operations. The coal lessee has the right to cause these wells
to be plugged and abandoned pursuant to an agreement entered into prior to the
formation of the Trust. This prior agreement is a "Permitted Encumbrance" under
the Conveyances and the Trust accepted its Net Profits Interest subject to this
prior agreement. Pursuant to this prior agreement the coal lessee is required to
pay for the wells it causes to be plugged and abandoned. Eastern American
received $10,000 for the Berwind #14, $22,336 for the Berwind #15, $63,128 for
the Berwind #36 and
7
<PAGE>
$149,525 for the Berwind #35 for a total consideration of $244,989 for the
plugging and abandonment of these wells. Ninety percent (90%) of this amount or
$220,490 is included on the September 30, 1999 Statement of Distributable Income
under Cash Proceeds on Sale of Net Profits Interests.
COMPARISON OF RESULTS OF OPERATIONS FOR THREE MONTHS ENDED SEPTEMBER 30, 1999
AND THREE MONTHS ENDED SEPTEMBER 30, 1998
The Trust's distributable income was $2,452,854 for the three months ended
September 30, 1999 as compared to $2,142,303 for the three months ended
September 30, 1998. This increase was due in part, to an increase in Cash
Proceeds on Sale of Net Profits Interest together with an increase in the price
payable to the Trust under the Gas Purchase Contract as discussed below ($3.386
per Mcf for the three months ended September 30, 1999; $3.197 per Mcf for the
three months ended September 30, 1998). This increase was partially offset by a
decrease in production of gas attributable to the Net Profits Interests for the
three months ended September 30, 1999 (778 Mmcf) as compared to the three months
ended September 30, 1998 (790 Mmcf). This decline in production is partially
attributable to the natural declines in production and the required plugging and
abandonment of certain wells in previous and current periods. The distributable
income includes Cash Proceeds on Sale of Net Profits Interest of $220,490 for
the quarter ended September 30, 1999, while no such sales were recognized in the
corresponding prior quarter.
The price payable to the Trust for gas production attributable to the Net
Profits Interests was $3.386 per Mcf for the three months ended September 30,
1999 and $3.197 per Mcf for the three months ended September 30, 1998. The price
per Mcf was higher for the three months ended September 30, 1999 than for the
corresponding three month period ending September 30, 1998 due to a higher Fixed
Price component ($3.56 per Mcf for the three months ended September 30, 1999;
$3.39 per Mcf for the three months ended September 30, 1998). This increase in
price was also due to an increase in the Variable Price component established by
the average futures spot market price for gas delivered at the Henry Hub near
Henry, Louisiana ($2.465 per Dth for the three months ended September 30, 1999;
$2.255 per Dth for the three months ended September 30, 1998).
COMPARISON OF RESULTS OF OPERATIONS FOR NINE MONTHS ENDED SEPTEMBER 30, 1999 AND
NINE MONTHS ENDED SEPTEMBER 30, 1998
The Trust's distributable income was $6,492,927 for the nine months ended
September 30, 1999 as compared to $7,349,634 for the nine months ended September
30, 1998. This decrease was due to a decrease in production of gas attributable
to the Net Profits Interests for the nine months ended September 30, 1999 (2,211
Mmcf) as compared to the nine months ended September 30, 1998 (2,398 Mmcf)
together with a decrease in Cash Proceeds on Sale of Net Profits Interest as
discussed below. The production decreases were attributable to the natural
production declines associated with the Underlying Properties and the required
plugging and abandonment of certain wells in previous and current periods. This
decrease was partially offset by an increase in the average price payable to the
Trust under the Gas Purchase Contract ($3.266 per Mcf for the nine months ended
September 30, 1999; $3.228 per Mcf for the nine months ended September 30,
1998). The distributable income
8
<PAGE>
includes Cash Proceeds on Sale of Net Profits Interests of $503,434 for the nine
months ended September 30, 1999, as compared to $838,474 of Cash Proceeds on
Sale of Net Profits Interests included in the nine months ended September 30,
1998.
The average price payable to the Trust for gas production attributable to
the Net Profits Interests was $3.266 per Mcf for the nine months ended September
30, 1999 and $3.228 per Mcf for the nine months ended September 30, 1998. The
price per Mcf was higher for the nine months ended September 30, 1999 than for
the corresponding nine month period ending September 30, 1998 due to a higher
Fixed Price component ($3.56 per Mcf for the nine months ended September 30,
1999; $3.39 per Mcf for the nine months ended September 30, 1998) which was
partially offset by a lower Variable Price component of the Index Price under
the Gas Purchase Contract ($2.681 per Mcf for the nine months ended September
30, 1999; $2.905 per Mcf for the nine months ended September 30, 1998). Such
lower Variable Price is directly attributable to a decrease in the average
futures spot market prices for gas delivered at the Henry Hub near Henry,
Louisiana for the nine months ended September 30, 1999 ($2.137 per Dth) as
compared to the nine months ended September 30, 1998 ($2.340 per Dth).
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings.
9
<PAGE>
None.
ITEM 2. Changes in Securities.
None.
ITEM 3. Defaults Upon Senior Securities.
None.
ITEM 4. Submission of Matters to a Vote of Security Holders.
None.
ITEM 5. Other Information.
For the calendar quarter ended September 30, 1999, the high and low
closing prices of the Treasury Obligations (which have $1,000 face principal
amount), as quoted in the over-the-counter market for United States Treasury
obligations, were $428.40 and $407.80 respectively. On September 30, 1999 the
closing price of the Treasury Obligations, as quoted on such market, was
$416.60.
ITEM 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
None
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the fiscal
quarter ended September 30, 1999.
10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
EASTERN AMERICAN NATURAL GAS TRUST
By: Bank of Montreal Trust Company, Trustee
/s/ ROBERT D. FOLTZ
Robert D. Foltz
Vice President
Date: November 12, 1999
The Registrant, Eastern American Natural Gas Trust, has no principal
executive officer, principal financial officer, board of directors or persons
performing similar functions. Accordingly no additional signatures are available
and none have been provided.
11
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS FINANCIAL DATA SCHEDULE CONTAINS INFORMATION EXTRACTED FROM EASTERN
AMERICAN NATURAL GAS TRUST'S FINANCIAL STATEMENTS FOR THE QUARTER ENDED
SEPTEMBER 30, 1999 CONTAINED IN THE TRUST'S QUARTERLY REPORT ON FORM 10-Q FOR
THE QUARTER ENDED SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIALS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,529
<SECURITIES> 0
<RECEIVABLES> 2,550,443
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,551,972
<PP&E> 93,162,180
<DEPRECIATION> 38,679,262
<TOTAL-ASSETS> 57,034,890
<CURRENT-LIABILITIES> 2,551,972
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 54,482,918
<TOTAL-LIABILITY-AND-EQUITY> 57,034,890
<SALES> 7,226,696
<TOTAL-REVENUES> 7,226,696
<CGS> 0
<TOTAL-COSTS> 863,837
<OTHER-EXPENSES> (130,068)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 6,492,927
<INCOME-TAX> 0
<INCOME-CONTINUING> 6,492,927
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,492,927
<EPS-BASIC> 1.10
<EPS-DILUTED> 0
</TABLE>
