SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________________________________
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1997 Commission File Number 0-25192
CALLON PETROLEUM COMPANY
(Exact name of Registrant as specified in its charter)
Delaware 64-0844345
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 North Canal Street
Natchez, Mississippi 39120
(Address of principal executive offices)(Zip code)
(601) 442-1601
(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 require-
ments for the past 90 days.
Yes X No
---- ----
As of August 5, 1997, there were 5,996,171 shares of the Registrant's Common
Stock, par value $.01 per share, outstanding.
<PAGE>
CALLON PETROLEUM COMPANY
INDEX
Page No.
Part I. Financial Information
Consolidated Balance Sheets as of June 30,
1997 and December 31, 1996 3
Consolidated Statements of Operations for the
three and six-month periods ended June 30, 1997
and June 30, 1996 4
Consolidated Statements of Cash Flows for the
six-month periods ended June 30, 1997 and
June 30, 1996 5
Notes to Consolidated Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-10
Part II. Other Information 11-14
<PAGE>
<TABLE>
<CAPTION>
CALLON PETROLEUM COMPANY
CONSOLIDATED BALANCE SHEETS
($ in thousands, except share data)
June 30, December 31,
1997 1996
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 8,940 $ 7,669
Accounts receivable 9,641 12,661
Other current assets 712 516
--------- ---------
Total current assets 19,293 20,846
Oil & gas properties, full cost accounting method: --------- ---------
Evaluated properties 351,633 322,970
Less accumulated depreciation, depletion and amortization (274,143) (266,716)
--------- ---------
77,490 56,254
Unevaluated properties excluded from amortization 30,763 26,235
--------- ---------
108,253 82,489
--------- ---------
Pipeline and other facilities, net 6,463 6,618
Other property and equipment, net 1,883 1,594
Deferred tax asset 3,101 5,412
Long-term gas balancing receivable 496 660
Other assets, net 852 901
--------- ---------
Total assets $ 140,341 $ 118,520
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 8,060 $ 8,273
Undistributed oil and gas revenues 2,827 2,260
Accrued net profits interest payable 3,929 5,435
--------- ---------
Total current liabilities 14,816 15,968
--------- ---------
Long-term debt 42,750 24,250
Other long-term liabilities 170 48
Long-term gas balancing payable 551 390
--------- ---------
Total liabilities 58,287 40,656
--------- ---------
Stockholders' equity:
Preferred stock, $0.01 par value, 2,500,000 shares authorized:
1,315,500 shares of Convertible Exchangeable Preferred Stock,
Series A, issued and outstanding with a liquidation preference
of $32,887,500 13 13
Common stock, $0.01 par value; 20,000,000 shares authorized;
5,996,171 at June 30, 1997 and 5,758,667 outstanding at
December 31, 1996 60 58
Unearned compensation - restricted stock (2,181) --
Capital in excess of par value 76,903 74,027
Retained earnings 7,259 3,766
--------- ---------
Total stockholders' equity 82,054 77,864
--------- ---------
Total liabilities and stockholders' equity $ 140,341 $ 118,520
========= =========
The accompanying notes are an integral part of these financial statements.
<PAGE>
<CAPTION>
CALLON PETROLEUM COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
($ in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Revenues:
Oil and gas sales $ 8,370 $ 5,874 $ 20,844 $ 12,249
Interest and other 388 173 695 278
--------- -------- --------- ---------
Total revenues 8,758 6,047 21,539 12,527
--------- -------- --------- ---------
Costs and expenses:
Lease operating expenses 1,756 1,894 4,164 3,686
Depreciation, depletion and amortization 3,765 2,459 7,581 4,844
General and administrative 1,351 800 2,382 1,707
Interest 99 23 210 48
--------- -------- --------- ---------
Total costs and expenses 6,971 5,176 14,337 10,285
--------- -------- --------- ---------
Income from operations 1,787 871 7,202 2,242
Income tax expense 578 -- 2,311 --
--------- -------- ---------- ----------
Net income 1,209 871 4,891 2,242
Preferred stock dividend 699 699 1,398 1,398
--------- -------- --------- ---------
Net income available to common shares $ 510 $ 172 $ 3,493 $ 844
========= ======== ========= =========
Net income per common share:
Primary $ 0.08 $ 0.03 $ 0.55 $ 0.15
Assuming full dilution $ 0.08 $ 0.03 $ 0.52 $ 0.15
Shares used in computing net income per common share:
Primary 6,268 5,755 6,307 5,755
Assuming full dilution 6,331 5,755 9,318 5,755
The accompanying notes are an integral part of these financial statements.
<PAGE>
<CAPTION>
CALLON PETROLEUM COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
($ in thousands)
Six Months Ended
June 30, June 30,
1997 1996
<S> <C> <C>
Cash flows from operating activities:
Net income $ 4,891 $ 2,242
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation, depletion and amortization 7,791 4,982
Amortization of deferred costs 188 --
Deferred income tax expense 2,311 65
15,181 7,289
Changes in current assets & liabilities:
Accounts receivable 3,020 330
Other current assets (196) 123
Current liabilities (1,152) 3,029
Change in gas balancing receivable 164 84
Change in gas balancing payable 161 (37)
Change in other long-term liabilities 122 (22)
Change in other assets, net (138) (45)
---------- ---------
Cash provided by operating activities 17,162 10,751
---------- ---------
Cash flows from investing activities:
Capital expenditures (36,214) (9,166)
Cash proceeds from sale of mineral interests 2,524 299
---------- ---------
Cash used in investing activities (33,690) (8,867)
---------- ---------
Cash flows from financing activities:
Increase in debt 18,500 --
Common stock issued pursuant to employee benefit plan 148 --
Unearned restricted stock compensation 519 --
Equity issued by conversion of stock options 30 --
Increase in accrued preferred stock dividends payable -- 443
Dividends on preferred stock (1,398) (1,398)
---------- ---------
Cash provided by (used in) financing activity 17,799 (955)
---------- ---------
Net increase in cash and cash equivalents 1,271 929
Cash and cash equivalents:
Balance, beginning of period 7,669 4,265
---------- ----------
Balance, end of period $ 8,940 $ 5,194
========== ==========
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
CALLON PETROLEUM COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1997
1. Basis of Presentation
The financial information presented as of any date other than December 31, has
been prepared from the books and records without audit. Financial information
as of December 31, has been derived from the audited financial statements of
the Company, but does not include all disclosures required by generally accepted
accounting principles. In the opinion of management, all adjustments, consist-
ing only of normal recurring adjustments, necessary for the fair presentation
of the financial information for the period indicated, have been included. For
further information regarding the Company's accounting policies, refer to the
Consolidated Financial Statements and related notes for the year ended
December 31, 1996 included in the Company's Annual Report on Form 10-K dated
March 24, 1997.
2. Earnings Per Share
Fully diluted earnings per share for the six months ended June 30, 1997 was
calculated assuming the conversion of the Company's preferred stock into
common stock. The preferred stock was not included in current quarter to
date and prior year calculations due to their antidilutive effect on fully
diluted earnings per share.
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128 ("FAS 128"), "Earnings Per Share", which simplifies the computation of
earnings per share. FAS 128 is effective for financial statements issued for
periods ending after December 15, 1997 and requires restatement for all prior
period earnings per share data presented. Accordingly, basic earnings per
share and diluted earnings per share calculated in accordance with FAS 128 were
as follows:
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
Per Share Data:
Basic earnings per share $ 0.08 $ 0.03 $ 0.58 $ 0.15
Diluted earnings per share $ 0.08 $ 0.03 $ 0.52 $ 0.15
3. Acquisitions
In June of 1997, the Company acquired an 18.8% working interest in Mobile Area
Blocks 863 and 907, and a 35% working interest in Mobile Area Block 908 from
ELF Exploration, Inc. The net purchase price was $11.8 million and was funded
by the Company's Credit Facility.
4. Senior Subordinated Notes
On July 31, 1997 the Company issued $36,000,000 of 10.125% Senior Subordinated
Notes due 2002. Interest is payable quarterly beginning September 15, 1997.
The Senior Subordinated Notes were offered pursuant to a Rule 144A transaction
or an applicable exemption from registration requirements.
The net proceeds to the Company, after costs of the transaction, were used to
repay the outstanding balance on Callon's Credit Facility and will fund a
portion of the remaining 1997 capital expenditure budget.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
The Company's revenues, profitability and future growth and the carrying value
of its oil and gas properties are substantially dependent on prevailing prices
of oil and gas. The Company's ability to maintain or increase its borrowing
capacity and to obtain additional capital on attractive terms is also sub-
stantially dependent upon oil and gas prices. Prices for oil and gas are
subject to large fluctuation in response to relatively minor changes in the
supply of and demand for oil and gas, market uncertainty and a variety of
additional factors beyond the control of the Company. Any substantial and
extended decline in the price of oil or gas would have an adverse effect on
the Company's carrying value of its proved reserves, borrowing capacity,
revenues, profitability and cash flows from operations.
The following discussion is intended to assist in an understanding of the
Company's historical financial position and results of operations for the
three and six-month periods ended June 30, 1997 and 1996. The Company's
historical financial statements and notes thereto included elsewhere in
this quarterly report contain detailed information that should be referred
to in conjunction with the following discussion.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of capital are its cash flow from operations,
borrowings from financial institutions and the sale of debt and equity secur-
ities. Net cash provided by operating activities for the six months ending
June 30, 1997 totaled $17.2 million. Other sources of cash during the first
six months were $18.5 million advanced under the Company's credit facility and
$2.5 million from the sale of mineral interests. During the first half of 1997,
capital expenditures were $36.2 million and $1.4 million was paid as dividends
to the preferred stockholders. The balance of available funds were retained for
future operating expenses and potential drilling and acquisition opportunities.
At June 30, 1997, the Company had working capital of $4.5 million and a current
ratio of 1.3 to 1.
The Company has budgeted up to $60 million in capital expenditures for 1997.
During the first six months of 1997, the Company has expended approximately
$12 million on drilling and exploration activities and $22 million in acquisi-
tions of additional producing properties, undeveloped mineral interesrs and
seismic information attributable to future drilling sites. For the balance
of the year, the Company will continue evaluating producing property acquisi-
tions and drilling opportunities. The major portion of the remaining capital
expenditure budget will be used for exploratory and development activities.
The capital budget will be financed with the sale of debt securities, pro-
jected cash flow from operations and unused borrowings under the Company's
Credit Facility.
On July 31, 1997 the Company issued $36,000,000 of 10.125% Senior Subordinated
Notes due 2002. Interest is payable quarterly beginning September 15, 1997.
The Senior Subordinated Notes were offered pursuant to a Rule 144A transaction
or an applicable exemption from registration requirements. The net proceeds
to the Company, after costs of the transaction, were used to repay the out-
standing balance on Callon's Credit Facility and will fund a portion of the
remaining 1997 capital expenditure budget.
<PAGE>
RESULTS OF OPERATIONS
The following table sets forth certain operating information with respect to
the oil and gas operations of the Company.
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
Production:
Oil (MBbls) 108 159 237 302
Gas (MMcf) 3,057 1,444 6,448 2,912
Total production (MMcfe) 3,707 2,400 7,869 4,725
Average sales price:
Oil (per Bbl) $ 17.30 $ 17.89 $ 19.36 $ 18.12
Gas (per Mcf) 2.13 2.09 2.52 2.33
Total production (per Mcfe) 2.26 2.45 2.65 2.59
Average costs (per Mcfe):
Lease operating (excluding
severance taxes) $ 0.39 $ 0.59 $ 0.43 $ 0.58
Severance taxes 0.08 0.20 0.09 0.20
Depreciation, depletion and
amortization 1.02 1.02 0.96 1.03
General and administrative
(net of management fees) 0.36 0.33 0.30 0.36
Comparison of Results of Operations for the Three Months Ended
June 30, 1997 and the Three Months Ended June 30, 1996.
Oil and Gas Production and Revenues
- -----------------------------------
Total oil and gas revenues increased 42% from $5.9 million in 1996 to $8.4
million in 1997. This increase is largely the result of increased gas pro-
duction.
Oil production during the second quarter of 1997 totaled 108,000 barrels and
generated $1.9 million in revenues compared to 159,000 barrels and $2.9 million
in revenues for the same period in 1996. Second quarter average daily produc-
tion decreased from 1,750 barrels per day in 1996 to 1,190 barrels per day in
1997. Average oil prices received in the second quarter of 1997 were $17.30
compared to $17.89 in 1996. Production decreases in the second quarter of 1997
are largely attributable to properties that were sold.
Gas production during the second quarter of 1997 totaled 3.1 billion cubic feet
and generated $6.5 million in revenues compared to 1.4 billion cubic feet and
$3.0 million in revenues during the same period in 1996. The average sales
price for the second quarter of 1997 averaged $2.13 per thousand cubic feet
compared to $2.09 per thousand cubic feet at this time last year. Although
the North Dauphin Island Field production was lower than last year, production
from the newly acquired properties more than offset this decline.
<PAGE>
The following table summarizes oil and gas production from the Company's major
producing properties for the comparable periods.
Oil Production Gas Production
(Barrels) (Mcf)
Three Months Ended Three Months Ended
June 30, June 30,
1997 1996 1997 1996
Chandeleur Block 40 -- -- 1,078,000 419,000
Main Pass 163 -- -- 1,206,000 33,000
Main Pass 164/165 -- -- 139,000 --
North Dauphin Island Field -- -- 368,000 675,000
Black Bay Complex 46,000 52,000 -- --
Big Escambia Creek 26,000 27,000 51,000 54,000
Other properties 36,000 80,000 215,000 263,000
------- ------- --------- ---------
Total 108,000 159,000 3,057,000 1,444,000
======= ======= ========= =========
Lease Operating Expenses
- ------------------------
Lease operating expenses, including severance taxes, for the three-month period
ending June 30, 1997 were $1.8 million, substantially unchanged from $1.9
million for the same period in 1996.
Depreciation, Depletion and Amortization
- ----------------------------------------
Depreciation, depletion and amortization for the three months ending June 30,
1997 and 1996 was $3.8 million and $2.5 million, respectively, reflecting the
overall increase in production. For the three-month periods ending June 30,
1996 and 1997, the per Mcf equivalent amount was $1.02.
General and Administrative
- --------------------------
General and administrative expense for the three months ended June 30, 1997 was
$1.4 million compared to $0.8 million for the three months ended June 30, 1996.
This expense increase is generally attributable to increased executive compen-
sation, increased travel and transportation expenses and the loss of management
fees as a result of property sales.
Interest Expense
- ----------------
Interest expense increased from $23,000 during the three months ended June 30,
1996 to $99,000 during the three months ended June 30, 1997 reflecting the
increase in the Company's long-term debt.
Comparison of Results of Operations for the Six Months Ended
June 30, 1997 and the Six Months Ended June 30, 1996.
Oil and Gas Production and Revenues
- -----------------------------------
For the six months ended June 30, 1997, total oil and gas revenues increased by
$8.6 million, or 70%, to $20.8 million when compared to $12.2 million for the
same period in 1996.
For the six months ending June 30, 1997, oil production and oil revenues
decreased to 237,000 barrels and $4.6 million, respectively. For the
comparable period in 1996, oil production was 302,000 barrels while revenues
totaled $5.5 million. Oil prices during the first six months of 1997 averaged
$19.36, compared to $18.12 for the same period in 1996. Although prices were
higher, the loss of production from the properties which were sold and the
decline in other non-core properties caused the overall decline in oil revenues.
<PAGE>
Natural gas production and revenue for the six-month period ending June 30,
1997 were 6.4 billion cubic feet and $16.3 million, respectively, increasing
from 2.9 billion cubic feet and gas revenues of $6.8 million in the first six
months of 1996. The average sales price for natural gas in the first six months
in 1997 was $2.52 per Mcf, a $0.19 per Mcf increase over the same period in
1996. The combination of increased prices and production volumes generated
the 140% increase in total gas revenues.
The following table summarizes oil and gas production from the Company's major
producing properties for the comparable periods.
Oil Production Gas Production
(Barrels) (Mcf)
Six Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
Chandeleur Block 40 -- -- 2,251,000 757,000
Main Pass 163 -- -- 2,477,000 33,000
Main Pass 164/165 -- -- 270,000 --
North Dauphin Island Field -- -- 826,000 1,475,000
Black Bay Complex 93,000 101,000 -- --
Big Escambia Creek 56,000 49,000 98,000 84,000
Other properties 88,000 152,000 526,000 563,000
------- ------- --------- ---------
Total 237,000 302,000 6,448,000 2,912,000
======= ======= ========= =========
Lease Operating Expenses
- ------------------------
Lease operating expenses, excluding severance taxes, for the first half of 1997
increased by 26% to $3.4 million from $2.7 million for the 1996 comparable
period. This increase is primarily the result of first quarter expenses
associated with the new producing properties. Severance taxes decreased
by 22% to $0.7 million during the first six months of 1997 from $0.9 million
for the same period in 1996 as a result of production declines in the Company's
onshore properties and the sale of properties.
Depreciation, Depletion and Amortization
- ----------------------------------------
Depreciation, depletion and amortization for the first six months of 1997 was
$7.6 million, or $0.96 per Mcf equivalent. For the same period in 1996, the
total was $4.8 million and $1.03 per Mcf equivalent.
General and Administrative
- --------------------------
During the first six months of 1997, general and administrative expenses
increased by 40% to $2.4 million compared $1.7 million for the same six-
month period in 1996. Increased executive compensation, travel and
transportation expenses and the loss of management fees, as a result of
property sales, combined to produce this overall increase.
Interest Expense
- ----------------
Interest expense during the first half of 1997 was $210,000 compared to $48,000
for the first half of 1996 as a result of the increase in the Company's long-
term debt.
<PAGE>
CALLON PETROLEUM COMPANY
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
The Company's annual meeting was held on June 19, 1997, at which two Class III
directors were elected and the appointment of Arthur Andersen LLP as the
Company's independent public accountants for the year ending December 31, 1997
was ratified. In addition, the Callon Petroleum Company 1996 Stock Incentive
Plan and the Callon Petroleum Company 1997 Employee Stock Purchase Plan were
both adopted.
The nominees for director were Messrs. Fred L. Callon and Dennis W. Christian.
Mr. Callon received 4,761,844 votes for, 38,171 votes against or withheld and
no votes abstained. Mr. Christian received 4,768,090 votes for, 31,925 votes
against or withheld and no votes abstained.
The ratification of Arthur Andersen LLP received 4,783,769 votes for, 5,258
votes against or withheld and 10,988 votes abstained.
The adoption of the Callon Petroleum Company 1996 Stock Incentive Plan received
4,153,510 votes for, 177,498 votes against or withheld and 469,007 votes
abstained.
The adoption of the Callon Petroleum Company Employee Stock Purchase Plan
received 4,257,925 votes for, 121,272 votes against or withheld and 420,818
votes abstained.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
2. Plan of acquisition, reorganization, arrangement, liquidation
or succession*
3. Articles of Incorporation and By-Laws
3.1 Certificate of Incorporation of the Company, as amended
(incorporated by reference from Exhibit 3.1 of the
Company's Registration Statement on Form S-4, Reg. No.
33-82408)
3.2 Certificate of Merger of Callon Consolidated Partners,
L.P. with and into the Company dated September 16, 1994
(incorporated by reference from Exhibit 3.2 of the
Company's Report on Form 10-K for the period ended
December 31, 1994)
3.3 Bylaws of the Company (incorporated by reference from
Exhibit 3.2 of the Company's Registration Statement on
Form S-4, Reg. No. 33-82408)
4. Instruments defining the rights of security holders,
including indentures
4.1 Specimen stock certificate (incorporated by reference from
Exhibit 4.1 of the Company's Registration Statement on
Form S-4, Reg. No. 33-82408)
4.2 Specimen Preferred Stock Certificate (incorporated by
reference from Exhibit 4.2 of the Company's Registration
Statement on Form S-1, Reg. No. 33-96700)
<PAGE>
4.3 Designation for Convertible Exchangeable Preferred Stock,
Series A (incorporated by reference from Exhibit 4.3 of
the Company's Report on Form 10-K for the period ended
December 31, 1995)
4.4 Indenture for Convertible Debentures (incorporated by
reference from Exhibit 4.4 of the Company's Report on
Form 10-K for the period ended December 31, 1995)
4.5 Certificate of Correction on Designation of Series A
Preferred Stock (incorporated by reference from Exhibit
4.4 of the Company's Registration Statement on Form S-1/A
filed November 22, 1996, Reg. No. 333-15501)
4.6 Form of Note Indenture (incorporated by reference from
Exhibit 4.6 of the Company's Registration Statement on
Form S-1/A filed November 22, 1996, Reg. No. 333-15501)
9. Voting trust agreement*
10. Material contracts
10.1 Contingent Share Agreement dated September 16, 1996 between
the Company and the Callon Stockholders (incorporated by
reference from Exhibit 10.1 of the Company's Registration
Statement on Form 8-B filed October 3, 1994)
10.2 Registration Rights Agreement dated September 16, 1994
between the Company and NOCO Enterprises, L. P. (incor-
porated by reference from Exhibit 10.2 of the Company's
Registration Statement on Form 8-B filed October 3, 1994)
10.3 Registration Rights Agreement dated September 16, 1994
between the Company and Callon Stockholders (incorporated
by reference from Exhibit 10.3 of the Company's Regis-
tration Statement on Form 8-B filed October 3, 1994)
10.4 Employment Agreement dated September 16, 1994 between the
Company and Fred L. Callon (incorporated by reference from
Exhibit 10.4 of the Company's Registration Statement on
Form 8-B filed October 3, 1994)
10.5 Callon Petroleum Company 1994 Stock Incentive Plan
(incorporated by reference from Exhibit 10.5 of the
Company's Registration Statement on Form 8-B filed
October 3, 1994)
10.6 Employment Agreement effective January 1, 1995, between
the Company and Dennis W. Christian (incorporated by
reference from Exhibit 10.6 of the Company's Form 10-K
for the period ended December 31, 1995)
10.7 Credit Agreement dated October 14, 1994 by and between the
Company, Callon Petroleum Operating Company and Inter-
nationale Nederlanden (U.S.) Capital Corporation (incor-
porated by reference from Exhibit 99.1 of the Company's
Report on Form 10-Q for the quarter ended September 30,
1994)
10.8 Employment Agreement effective January 1, 1995, between
the Company and John S. Weatherly (incorporated by ref-
erence from Exhibit 10.8 of the Company's Registration
Statement on Form S-1, Reg. No. 33-96700)
<PAGE>
10.9 Third Amendment dated February 22, 1996, to Credit Agree-
ment by and among Callon Petroleum Operating Company,
Callon Petroleum Company and Internationale Nederlanden
(U.S.) Capital Corporation (incorporated by reference from
Exhibit 10.9 of the Company's report on Form 10-K for the
period ended December 31, 1995)
10.10 Consulting Agreement between the Company and John S. Callon
dated June 19, 1996 (incorporated by reference from Exhibit
10.10 of the Company's Registration Statement on Form S-1,
filed November 5, 1996, Reg. No. 333-15501)
10.11 Callon Petroleum Company 1996 Stock Incentive Plan
(incorporated by reference from Exhibit 10.6 of the
Company's Registration Statement on Form S-1/A, filed
November 14, 1996, Reg. No. 333-15501)
10.12 Employment Agreement effective September 1, 1996, between
the Company and Fred L. Callon (incorporated by reference
from Exhibit 10.4 of the Company's Registration Statement
on Form S-1/A, filed November 14, 1996, Reg. No. 333-15501)
10.13 Employment Agreement effective September 1, 1996, between
the Company and Dennis W. Christian (incorporated by ref-
erence from Exhibit 10.7 of the Company's Registration
Statement on Form S-1/A, filed November 14, 1996,
Reg. No. 333-15501)
10.14 Employment Agreement effective September 1, 1996, between
the Company and John S. Weatherly (incorporated by ref-
erence from Exhibit 10.8 of the Company's Registration
Statement on Form S-1/A, filed November 14, 1996,
Reg. No. 333-15501)
10.15 Callon Petroleum Company 1996 Stock Incentive Plan (incor-
porated by reference from Exhibit 4.2 of the Company's
Registration Statement on Form S-8, Reg. No. 333-29537)
10.16 Callon Petroleum Company 1997 Employee Stock Purchase Plan
(incorporated by reference from Exhibit 4.2 of the
Company's Registration Statement on Form S-8,
Reg. No. 333-29529)
11. Statement re computation of per share earnings*
15. Letter re unaudited interim financial information*
18. Letter re change in accounting principles*
19. Report furnished to security holders*
22. Published report regarding matters submitted to vote of
security holders*
23. Consents of experts and counsel*
24. Power of attorney*
27. Financial Data Schedule*
99. Additional exhibits*
<PAGE>
(b) Reports on Form 8-K and 8-K/A.
On July 11, 1997, the Company filed a report on Form 8-K
in connection with the Company's purchase of certain oil
and gas mineral interests from Elf Exploration, Inc. (the
"Elf Acquisition) for $11.8 million. The Company purchased
an 18.8% working interest in the Mobile Area Block 864
Unit. The purchase included a 17.5% working interest in
Mobile Area Blocks 863 and 907 and a 35% working interest
in Mobile Area Block 908. At the time this report was
filed, it was impracticable to provide the required
financial statements and pro forma information. On August
8, 1997, the Company filed a report on Form 8-K/A which
included the required audited financial statements of the
property acquired and the unaudited pro forma financial
information.
On August 8, 1997, the Company filed a report on Form 8-K
reporting the completion on July 31, 1997 of the sale of
$36 million of Senior Subordinated Notes due 2002 with a
coupon of 10.125%. The Company agree to file by October 1,
1997, and to use its best efforts to cause to become
effective by November 15, 1997, a registration statement
relating to an exchange offer for the Notes.
________________________________
* Inapplicable to this filing
<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.
CALLON PETROLEUM COMPANY
Date August 13, 1997 By /s/ John S. Weatherly
John S. Weatherly, Senior Vice
President, Chief Financial
Officer and Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF CALLON PETROLEUM COMPANY
FOR THE PERIOD ENDING June 30, 1997 WHICH ARE PRESENTED IN ITS QUARTERLY
REPORT ON FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 8,940
<SECURITIES> 0
<RECEIVABLES> 9,641
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 19,293
<PP&E> 390,742
<DEPRECIATION> 274,143
<TOTAL-ASSETS> 140,341
<CURRENT-LIABILITIES> 14,816
<BONDS> 0
0
13
<COMMON> 60
<OTHER-SE> 81,981
<TOTAL-LIABILITY-AND-EQUITY> 140,341
<SALES> 20,844
<TOTAL-REVENUES> 21,539
<CGS> 0
<TOTAL-COSTS> 14,127
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 210
<INCOME-PRETAX> 7,202
<INCOME-TAX> 2,311
<INCOME-CONTINUING> 3,493
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,493
<EPS-PRIMARY> 0.55
<EPS-DILUTED> 0.52
</TABLE>
