| Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies 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 and disclosure of contingent 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 those estimates. Significant estimates inherent in the Registrants
financial statements include the estimate of oil and gas reserves and future abandonment costs. Changes in oil and gas prices and
the changes in production estimates could have a significant effect on reserve estimates. The reserve estimates directly impact
the computation of depreciation, depletion, and amortization, asset retirement obligation, and the ceiling test for the Registrants
oil and gas properties. Full Cost Accounting The Partnership follows the full-cost method
of accounting for its oil and gas activities. Under the full-cost method, all productive and non-productive costs incurred in
the acquisition, exploration and development of oil and gas properties are capitalized. Depreciation, depletion and amortization
of oil and gas properties subject to amortization is computed on the units-of-production method based on the proved reserves underlying
the oil and gas properties. At December 31, 2015 and 2014 all capitalized costs were subject to amortization. Proceeds from the
sale or other disposition of properties are credited to the full cost pool. Gains and losses are not recognized unless such adjustments
would significantly alter the relationship between capitalized costs and the proved oil and gas reserves. Capitalized costs are
subject to a quarterly ceiling test that limits such costs to the aggregate of the present value of estimated future net cash
flows of proved reserves, computed using the 12-month unweighted average of first-day-of the-month oil and natural gas prices,
discounted at 10%, and the lower of cost or fair value of unproved properties. If unamortized costs capitalized exceed the ceiling,
the excess is charged to expense in the period the excess occurs. There were cost ceiling write-downs totaling $16,239,986 and
$900,360 for the years ended December 31, 2015 and 2014, respectively. Cash The Partnership maintains all its cash in one
financial institution. At various times throughout the year, the cash amount may be in excess of the amount insured by the Federal
Deposit Insurance Corporation. Fair Value of Financial Instruments The Financial Accounting Standards Board (FASB)
has issued guidance on determining the estimated fair value for financial instruments. This disclosure states that the fair value
of financial instruments is determined at discrete points in time based on relevant market information. Such estimates involve
uncertainties and cannot be determined with precision. The estimated fair value of cash, accounts receivable and accounts
payable approximates their carrying value due to their short-term nature. Asset Retirement Obligations The Partnership has recognized an estimated
liability for future plugging and abandonment costs. A liability for the estimated fair value of the future plugging and abandonment
costs is recorded with a corresponding increase in the full cost pool at the time a new well is drilled. Depreciation expense associated
with estimated plugging and abandonment costs is recognized in accordance with the full cost methodology. The Partnership estimates a liability for plugging
and abandonment costs based on historical experience and estimated well life. The liability is discounted using the credit-adjusted
risk-free rate. Revisions to the liability could occur due to changes in well plugging and abandonment costs or well useful lives,
or if federal or state regulators enact new well restoration requirements. The Partnership recognizes accretion expense in connection
with the discounted liability over the remaining life of the well. A reconciliation of the Partnerships liability for well
plugging and abandonment costs for the year ended December 31, 2015 and December 31, 2014 is as follows:
2015 2014
Balance, beginning of period $ 1,093,815 $ 1,064,146
Liabilities incurred 1,799 3,434
Liabilities reduced due to settlements and sales of property (77,715 ) (17,135 )
Accretion expense 43,707 43,370
Balance, end of period $ 1,061,606 $ 1,093,815 Oil and Gas Sales The Partnerships oil and condensate
production is sold and revenue recognized at or near the Partnerships wells under short-term purchase contracts at prevailing
prices in accordance with arrangements which are customary in the oil industry. Sales of gas applicable to the Partnerships
interest are recorded as revenue when the gas is metered and title transferred pursuant to the gas sales contracts covering the
Partnerships interest in gas reserves. The Partnership uses the sales method to recognize oil and gas revenue whereby revenue
is recognized for the amount of production taken regardless of the amount for which the Partnership is entitled based on its working
interest ownership. As of December 31, 2015 and 2014, no material gas imbalances between the Partnership and other working interest
owners existed. Substantially all of the Partnerships
accounts receivable result from oil and natural gas sales to third parties in the oil and natural gas industry. This concentration
of customers may impact the Partnerships overall credit risk in that these entities may be similarly affected by changes
in economic and other conditions. Historically, the Partnership has not experienced significant credit losses on such receivables.
No bad debt expense was recorded in 2015 or 2014. The Partnership cannot ensure that such losses will not be realized in the future. Comprehensive Income Comprehensive income is defined as a change
in equity of a business enterprise during a period from transactions and other events and circumstances from non-partner sources
and includes all changes in equity during a period except those resulting from investments by partners and distributions to partners.
The Partnership has no items of comprehensive income, other than net income, in any period presented. Therefore, net income as
presented in the statements of operations equals comprehensive income. Income Taxes The Partnership is treated as a partnership
for income tax purposes and, as a result, income of the Partnership is reported on the tax returns of the partners and no recognition
is given to income taxes in the financial statements. The Partnerships financial reporting basis of its net assets exceeded
the tax basis of its net assets by $6,640,773 and $25,728,346 at December 31, 2015 and 2014, respectively. The Partnership accounts for uncertainty in
income taxes in accordance with applicable accounting guidance and recognizes the effects of those positions only if they are more
likely than not of being sustained. As no liability had been recognized as of December 31, 2015 or 2014, the Partnership did not
accrue for any interest or penalties. |
