United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from...............to...............
Commission file number 0-14233
ENEX PROGRAM I PARTNERS, L.P.
(Exact name of small business issuer as specified in its Charter)
New Jersey 76-0175128
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 200, Three Kingwood Place
Kingwood, Texas 77339
(Address of principal executive offices)
Issuer's telephone number:
(713) 358-8401
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ENEX PROGRAM I PARTNERS, L.P.
BALANCE SHEET
JUNE 30,
ASSETS 1995
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 130,167
Accounts receivable - oil & gas sales 380,448
Receivable from litigation settlement 267,319
Other current assets 107,345
Total current assets 885,279
OIL & GAS PROPERTIES
(Successful efforts accounting method) - Proved
mineral interests and related equipment & facilities 91,766,831
Less accumulated depreciation and depletion 87,446,564
Property, net 4,320,267
TOTAL $ 5,205,546
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Accounts payable $ 234,808
Payable to general partner 8,943
Total current liabilities 243,751
PARTNERS' CAPITAL:
Limited partners 3,964,253
General partner 997,542
Total partners' capital 4,961,795
TOTAL $ 5,205,546
See accompanying notes to financial statements.
I-1
ENEX PROGRAM I PARTNERS, L.P.
STATEMENTS OF OPERATIONS
(UNAUDITED) QUARTER ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1995 1994 1995 1994
REVENUES:
Oil, gas and gas plant sales $ 722,200 $ 928,682 $ 1,435,006 $ 1,753,443
EXPENSES:
Depreciation and depletion 166,196 228,099 330,195 437,175
Lease operating expenses 275,916 443,926 613,634 828,872
Production taxes 42,205 46,627 80,480 84,399
General and administrative 191,417 223,142 468,890 513,416
Total expenses 675,734 941,794 1,493,199 1,863,862
INCOME (LOSS) FROM OPERATIONS 46,466 (13,112) (58,193) (110,419)
OTHER INCOME (EXPENSE):
Interest income 6,366 19,671 12,890 19,671
Interest expense - (6,086) - (12,588)
Other income (expense), net 6,366 13,585 12,890 7,083
NET INCOME (LOSS) $ 52,832 $ 473 $ (45,303) $ (103,336)
See accompanying notes to financial statements.
I-2
ENEX PROGRAM I PARTNERS, L.P.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED
JUNE 30, JUNE 30,
1995 1994
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (45,303) $ (103,336)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and depletion 330,195 437,175
(Increase) in:
Accounts receivable - oil & gas sales (20,366) (45,992)
Receivable from litigation settlement (12,731) -
Other current assets (11,780) (43,159)
Increase (decrease) in:
Accounts payable 582 (45,242)
Payable to general partner (76,384) 35,468
Total adjustments 209,516 338,250
Net cash provided by operating activities 164,213 234,914
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions - development costs (46,315) (105,658)
CASH FLOWS FROM FINANCING ACTIVITIES:
Reduction in note payable to bank - (110,000)
NET INCREASE IN CASH 117,898 19,256
CASH AT BEGINNING OF YEAR 12,269 2,176
CASH AT END OF PERIOD $ 130,167 $ 21,432
Cash paid during the period for interest $ - $ 12,588
See accompanying notes to financial statements.
I-3
ENEX PROGRAM I PARTNERS, L.P.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
1. The interim financial information included herein is unaudited;
however, such information reflects all adjustments (consisting solely
of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of results for the
interim periods.
2. The Company has a $613,215 line-of-credit with a bank which secures a
letter of credit for the same amount. The note payable to a bank had
a stated interest rate of prime plus three fourths of one percent.
Principal payments of $50,000 were made on the note during the second
quarter of 1994. The note was completely repaid in the fourth quarter
of 1994. The weighted average principal outstanding was $319,231
during the first quarter of 1994 and bore interest at a weighted
average rate of 7.65% during the first quarter of 1994.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Second Quarter 1995 Compared to Second Quarter 1994
Oil and gas sales for the second quarter decreased from $928,682 in 1994 to
$722,200 in 1995. This represents a decrease of $206,482 (22%). Included
in the second quarter 1994 revenues was $45,956 of back revenues related to
production from the gas plant in prior years. Absent this revenue, sales
decreased by $160,526 (18%). Oil sales decreased by $36,349 or 10%. A 14%
decrease in oil production reduced sales by $52,870. This decrease was
partially offset by a 5% increase in the average oil sales price. Gas
sales decreased by $124,177 (24%). A 31% decrease in the average gas sales
price reduced sales by $174,695. This decrease was partially offset by a
10% increase in gas production. The decrease in oil production was
primarily due to natural production declines. The increase in gas
production was primarily due to new gas wells drilled on the Dent and
Schlensker acquisitions partially offset by natural production declines.
The changes in average sales prices correspond with changes in the overall
market for the sale of oil and gas.
Lease operating expenses decreased from $443,926 in 1994 to $275,916 in
1995. The decrease of $168,010 is primarily due to the recognition of
$228,269 for gas purchases and processing fees in 1994 related to prior
years, partially offset by workover expenses incurred on the A&W
acquisition in 1995.
Depreciation and depletion expense decreased from $228,099 in the second
quarter of 1994 to $166,196 in the second quarter of 1995. This represents
a decrease of $61,903 (27%). The changes in production, noted above,
reduced depreciation and depletion expense by $538. A 27% decrease in the
depletion rate reduced depreciation and depletion expense by an additional
$61,365. The rate decrease was primarily the result of an upward revision
of the oil reserves at December 31, 1994, partially offset by a downward
revision of the gas reserves at December 31, 1994.
General and administrative expenses decreased from $223,142 in 1994 to
$191,417 in 1995. This decrease of $31,725 (14%) is primarily due to less
staff time being required to manage the Company's operations in 1995.
First Six Months in 1995 Compared to First Six Months in 1994
Oil and gas sales for the first six months decreased from $1,753,443 in
1994 to $1,435,006 in 1995. This represents a decrease of $318,437 (18%).
Included in the 1994 revenues was $45,956 of back revenues related to
production from prior years from the gas plant. Without this revenue,
sales decreased by $272,481 or 16%. Oil sales decreased by $11,519 or 2%.
A 15% decrease in oil production due to natural production declines reduced
sales by $101,039. This decrease was partially offset by a 15% increase in
the average oil sales price. Gas sales decreased by $260,962 or 26%. A
24% decrease in the average gas sales price reduced sales by $234,718. A
3% decrease in gas production reduced sales by an additional $26,244. The
decrease in gas production was primarily due natural production declines,
partially offset by new gas wells drilled on the Dent and Schlensker
acquisitions. The changes in average sales prices correspond with changes
in the overall market for the sale of oil and gas.
Lease operating expenses decreased from $828,872 in 1994 to $613,634 in
1995. The decrease of $215,238 (26%) is primarily due to the recognition
of $228,269 for gas purchases and processing fees related to prior years.
Depreciation and depletion expense decreased from $437,175 in the first six
months of 1994 to $330,195 in the first six months of 1995. This
represents a decrease of $106,980 (24%). The changes in production, noted
above, decreased depreciation and depletion expense by $33,108. An 18%
decrease in the depletion rate reduced depreciation and depletion expense
by an additional $73,872. The rate decrease was primarily the result of an
upward revision of the oil reserves at December 31, 1994, partially offset
by a downward revision of the gas reserves at December 31, 1994.
General and administrative expenses increased from $513,416 in 1994 to
$468,890 in 1995. This decrease of $44,526 (9%) is primarily due to less
staff time being required to manage the Company's operations in 1995.
CAPITAL RESOURCES AND LIQUIDITY
The Company's cash flow is a direct result of the amount of net proceeds
realized from the sale of oil and gas production and the repayment of its
debt obligations. Accordingly, the changes in cash flow from 1994 to 1995
are primarily due to the changes in oil and gas sales described above and
the repayment of the Company's debt obligations. It is the general
partner's intention to distribute substantially all of the Company's
available cash flow, after debt repayment, to the Company's partners.
The Company discontinued the payment of distributions during 1990. Future
distributions are dependent upon, among other things, an increase in future
prices received for oil and gas. The Company will continue to recover its
reserves and reduce its debt obligations. It is anticipated that the
Company's distributions will be reinstated.
As of June 30, 1995, the Company had no material commitments for capital
expenditures. The Company does not intend to engage in any significant
developmental drilling activity.
PART II. OTHER INFORMATION
Item 1. Legal proceedings.
None
Item 2. Changes in securities.
None
Item 3. Defaults upon senior securities.
Not Applicable
Item 4. Submission of matters to a vote of security holders.
Not Applicable
Item 5. Other information.
Not Applicable
Item 6. Exhibits and reports on Form 8-K.
(a) There are no exhibits to this report.
(b) The Company filed no reports on Form 8-K during
the quarter ended June 30, 1995.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant has this report to be signed on its behalf by the undersigned
thereunto duly authorized.
ENEX PROGRAM I PARTNERS, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By: /s/ R. E. Densford
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
August 11, 1995 By: /s/ James A. Klein
James A. Klein
Controller and Chief
Accounting Officer
SIGNATURES
In accordance the requirements of the Exchange Act, the registrant
has this report to be signed on its behalf by the undersigned thereunto
duly authorized.
ENEX PROGRAM I PARTNERS, L.P.
(Registrant)
By:ENEX RESOURCES CORPORATION
General Partner
By:
R. E. Densford
Vice President, Secretary
Treasurer and Chief Financial
Officer
August 11, 1995 By:
James A. Klein
Controller and Chief
Accounting Officer