SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1999
Commission File Number:
I-B: 0-14657 I-C: 0-14658 I-D: 0-15831
I-E: 0-15832 I-F: 0-15833
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
--------------------------------------------------------
(Exact name of Registrant as specified in its Articles)
I-B 73-1231999
I-C 73-1252536
I-D 73-1265223
I-E 73-1270110
Oklahoma I-F 73-1292669
- ---------------------------- -------------------------------
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or Number)
organization)
Two West Second Street, Tulsa, Oklahoma 74103
------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(918) 583-1791
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
------ ------
1
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-B
COMBINED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1999 1998
---------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 1,358 $ 20,930
Accounts receivable:
Oil and gas sales 46,536 18,364
General Partner (Note 2) - 6,814
-------- --------
Total current assets $ 47,894 $ 46,108
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 270,964 275,445
DEFERRED CHARGE 74,248 74,248
-------- --------
$393,106 $395,801
======== ========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 10,803 $ 24,273
-------- --------
Total current liabilities $ 10,803 $ 24,273
ACCRUED LIABILITY $ 23,490 $ 23,490
PARTNERS' CAPITAL (DEFICIT):
General Partner ($106,158) ($107,999)
Limited Partners, issued and
outstanding, 11,958 units 464,971 456,037
-------- --------
Total Partners' capital $358,813 $348,038
-------- --------
$393,106 $395,801
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
2
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-B
COMBINED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
-------- --------
REVENUES:
Oil and gas sales $58,914 $59,328
Interest income 10 210
Loss on sale of oil and gas
properties - ( 106)
------- -------
$58,924 $59,432
COSTS AND EXPENSES:
Lease operating $11,258 $13,188
Production tax 3,672 3,608
Depreciation, depletion, and
amortization of oil and gas
properties 10,423 11,551
General and administrative
(Note 2) 13,789 12,875
------- -------
$39,142 $41,222
------- -------
NET INCOME $19,782 $18,210
======= =======
GENERAL PARTNER - NET INCOME $ 1,405 $ 1,362
======= =======
LIMITED PARTNERS - NET INCOME $18,377 $16,848
======= =======
NET INCOME per unit $ 1.53 $ 1.41
======= =======
UNITS OUTSTANDING 11,958 11,958
======= =======
The accompanying condensed notes are an integral part of these
combined financial statements.
3
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-B
COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
--------- ---------
REVENUES:
Oil and gas sales $130,296 $120,200
Interest income 68 732
Loss on sale of oil and gas
properties - ( 106)
-------- --------
$130,364 $120,826
COSTS AND EXPENSES:
Lease operating $ 40,729 $ 29,009
Production tax 7,687 6,930
Depreciation, depletion, and
amortization of oil and gas
properties 22,049 21,963
General and administrative
(Note 2) 35,886 33,967
-------- --------
$106,351 $ 91,869
-------- --------
NET INCOME $ 24,013 $ 28,957
======== ========
GENERAL PARTNER - NET INCOME $ 2,079 $ 2,290
======== ========
LIMITED PARTNERS - NET INCOME $ 21,934 $ 26,667
======== ========
NET INCOME per unit $ 1.83 $ 2.23
======== ========
UNITS OUTSTANDING 11,958 11,958
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
4
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-B
COMBINED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $24,013 $ 28,957
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 22,049 21,963
Loss on sale of oil and gas
properties - 106
(Increase) decrease in accounts
receivable - oil and gas sales ( 28,172) 17,140
Decrease in accounts receivable -
General Partner 6,814 -
Decrease in accounts payable ( 13,470) ( 4,432)
------- --------
Net cash provided by operating
activities $11,234 $ 63,734
------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($17,824) ($ 105)
Proceeds from sale of oil and gas
properties 256 -
------- --------
Net cash used by investing
activities ($17,568) ($ 105)
------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($13,238) ($109,586)
------- --------
Net cash used by financing activities ($13,238) ($109,586)
------- --------
NET DECREASE IN CASH AND CASH
EQUIVALENTS ($19,572) ($ 45,957)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 20,930 77,028
------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 1,358 $ 31,071
======= ========
The accompanying condensed notes are an integral part of these
combined financial statements.
5
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-C
COMBINED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1999 1998
----------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 32,891 $ 33,065
Accounts receivable:
Oil and gas sales 71,914 51,790
General Partner (Note 2) - 18,767
-------- --------
Total current assets $104,805 $103,622
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 165,833 175,640
DEFERRED CHARGE 80,059 80,059
-------- --------
$350,697 $359,321
======== ========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 12,500 $ 13,520
-------- --------
Total current liabilities $ 12,500 $ 13,520
ACCRUED LIABILITY $ 12,927 $ 12,927
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 96,455) ($ 96,039)
Limited Partners, issued and
outstanding, 8,885 units 421,725 428,913
-------- --------
Total Partners' capital $325,270 $332,874
-------- --------
$350,697 $359,321
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
6
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-C
COMBINED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ---------
REVENUES:
Oil and gas sales $110,881 $95,699
Interest income 135 703
Loss on sale of oil and gas
properties - ( 20)
-------- -------
$111,016 $96,382
COSTS AND EXPENSES:
Lease operating $ 21,516 $46,870
Production tax 5,902 6,739
Depreciation, depletion, and
amortization of oil and gas
properties 6,778 5,618
General and administrative
(Note 2) 25,538 24,549
-------- -------
$ 59,734 $83,776
-------- -------
NET INCOME $ 51,282 $12,606
======== =======
GENERAL PARTNER - NET INCOME $ 2,829 $ 819
======== =======
LIMITED PARTNERS - NET INCOME $ 48,453 $11,787
======== =======
NET INCOME per unit $ 5.45 $ 1.33
======== =======
UNITS OUTSTANDING 8,885 8,885
======== =======
The accompanying condensed notes are an integral part of these
combined financial statements.
7
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-C
COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ----------
REVENUES:
Oil and gas sales $188,375 $282,095
Interest income 338 1,990
Loss on sale of oil and gas
properties - ( 20)
-------- --------
$188,713 $284,065
COSTS AND EXPENSES:
Lease operating $ 60,499 $ 93,931
Production tax 10,506 17,076
Depreciation, depletion, and
amortization of oil and gas
properties 13,084 12,996
General and administrative
(Note 2) 56,920 55,161
-------- --------
$141,009 $179,164
-------- --------
NET INCOME $ 47,704 $104,901
======== ========
GENERAL PARTNER - NET INCOME $ 2,892 $ 5,665
======== ========
LIMITED PARTNERS - NET INCOME $ 44,812 $ 99,236
======== ========
NET INCOME per unit $ 5.04 $ 11.17
======== ========
UNITS OUTSTANDING 8,885 8,885
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
8
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-C
COMBINED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $47,704 $104,901
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 13,084 12,996
Loss on sale of oil and gas
properties - 20
(Increase) decrease in accounts
receivable - oil and gas sales ( 20,124) 47,944
Decrease in accounts receivable -
General Partner 18,767 -
Decrease in accounts payable ( 1,020) ( 6,519)
------- --------
Net cash provided by operating
activities $58,411 $159,342
------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 3,325) ($ 20)
Proceeds from sale of oil and
gas properties 48 -
------- --------
Net cash used by investing activities ($ 3,277) ($ 20)
------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($55,308) ($258,833)
------- --------
Net cash used by financing activities ($55,308) ($258,833)
------- --------
NET DECREASE IN CASH AND CASH
EQUIVALENTS ($ 174) ($ 99,511)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 33,065 141,699
------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $32,891 $ 42,188
======= ========
The accompanying condensed notes are an integral part of these
combined financial statements.
9
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-D
COMBINED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1999 1998
---------- ------------
CURRENT ASSETS:
Cash and cash equivalents $133,954 $167,361
Accounts receivable:
Oil and gas sales 127,906 134,477
-------- --------
Total current assets $261,860 $301,838
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 576,449 605,793
DEFERRED CHARGE 66,062 66,062
-------- --------
$904,371 $973,693
======== ========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 10,766 $ 9,270
Gas imbalance payable 43,521 43,521
-------- --------
Total current liabilities $ 54,287 $ 52,791
ACCRUED LIABILITY $ 14,456 $ 14,456
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 54,664) ($ 53,161)
Limited Partners, issued and
outstanding, 7,195 units 890,292 959,607
-------- --------
Total Partners' capital $835,628 $906,446
-------- --------
$904,371 $973,693
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
10
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-D
COMBINED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ----------
REVENUES:
Oil and gas sales $190,167 $186,722
Interest income 1,174 3,307
Gain on sale of oil and gas
properties - 108,746
-------- --------
$191,341 $298,775
COSTS AND EXPENSES:
Lease operating $ 10,021 $ 26,529
Production tax 12,849 13,884
Depreciation, depletion, and
amortization of oil and gas
properties 12,744 11,703
General and administrative
(Note 2) 22,038 21,684
-------- --------
$ 57,652 $ 73,800
-------- --------
NET INCOME $133,689 $224,975
======== ========
GENERAL PARTNER - NET INCOME $ 21,662 $ 34,889
======== ========
LIMITED PARTNERS - NET INCOME $112,027 $190,086
======== ========
NET INCOME per unit $ 15.57 $ 26.42
======== ========
UNITS OUTSTANDING 7,195 7,195
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
11
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-D
COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
--------- ----------
REVENUES:
Oil and gas sales $322,393 $480,382
Interest income 2,580 6,088
Gain on sale of oil and gas
properties - 255,796
-------- --------
$324,973 $742,266
COSTS AND EXPENSES:
Lease operating $ 53,832 $ 57,471
Production tax 22,522 31,822
Depreciation, depletion, and
amortization of oil and gas
properties 30,056 27,588
General and administrative
(Note 2) 48,556 47,567
-------- --------
$154,966 $164,448
-------- --------
NET INCOME $170,007 $577,818
======== ========
GENERAL PARTNER - NET INCOME $ 29,322 $ 89,622
======== ========
LIMITED PARTNERS - NET INCOME $140,685 $488,196
======== ========
NET INCOME per unit $ 19.55 $ 67.85
======== ========
UNITS OUTSTANDING 7,195 7,195
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
12
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-D
COMBINED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $170,007 $577,818
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 30,056 27,588
Gain on sale of oil and gas
properties - ( 255,796)
Decrease in accounts receivable -
oil and gas sales 6,571 109,050
Increase (decrease) in accounts
payable 1,496 ( 21,144)
-------- --------
Net cash provided by operating
activities $208,130 $437,516
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 712) ($ 1,857)
Proceeds from sale of oil and
gas properties - 268,638
-------- --------
Net cash provided (used) by
investing activities ($ 712) $266,781
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($240,825) ($686,991)
-------- --------
Net cash used by financing activities ($240,825) ($686,991)
-------- --------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ($ 33,407) $ 17,306
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 167,361 274,109
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $133,954 $291,415
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
13
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-E
COMBINED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 534,714 $ 12,003
Accounts receivable:
Oil and gas sales 637,538 651,445
General Partner (Note 2) 675,000 -
---------- ----------
Total current assets $1,847,252 $ 663,448
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 3,924,995 4,191,663
DEFERRED CHARGE 570,545 570,545
---------- ----------
$6,342,792 $5,425,656
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 71,415 $ 209,486
Gas imbalance payable 115,808 115,808
---------- ----------
Total current liabilities $ 187,223 $ 325,294
ACCRUED LIABILITY $ 151,490 $ 151,490
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 112,305) ($ 232,100)
Limited Partners, issued and
outstanding, 41,839 units 6,116,384 5,180,972
---------- ----------
Total Partners' capital $6,004,079 $4,948,872
---------- ----------
$6,342,792 $5,425,656
========== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
14
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-E
COMBINED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- -----------
REVENUES:
Oil and gas sales $ 949,135 $1,026,695
Interest income 2,832 12,920
Gain on sale of oil and gas
properties - 489,455
Insurance settlement 675,000 -
---------- ----------
$1,626,967 $1,529,070
COSTS AND EXPENSES:
Lease operating $ 199,360 $ 241,285
Production tax 59,534 70,829
Depreciation, depletion, and
amortization of oil and gas
properties 139,099 159,710
General and administrative
(Note 2) 124,059 122,432
---------- ----------
$ 522,052 $ 594,256
---------- ----------
NET INCOME $1,104,915 $ 934,814
========== ==========
GENERAL PARTNER - NET INCOME $ 184,787 $ 160,644
========== ==========
LIMITED PARTNERS - NET INCOME $ 920,128 $ 774,170
========== ==========
NET INCOME per unit $ 21.99 $ 18.51
========== ==========
UNITS OUTSTANDING 41,839 41,839
========== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
15
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-E
COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
----------- -----------
REVENUES:
Oil and gas sales $1,654,037 $2,092,070
Interest income 3,169 22,299
Gain on sale of oil and gas
properties - 1,149,051
Insurance settlement 675,000 -
---------- ----------
$2,332,206 $3,263,420
COSTS AND EXPENSES:
Lease operating $ 447,730 $ 456,139
Production tax 109,615 144,939
Depreciation, depletion, and
amortization of oil and gas
properties 276,642 312,718
General and administrative
(Note 2) 278,611 272,850
---------- ----------
$1,112,598 $1,186,646
---------- ----------
NET INCOME $1,219,608 $2,076,774
========== ==========
GENERAL PARTNER - NET INCOME $ 221,196 $ 351,952
========== ==========
LIMITED PARTNERS - NET INCOME $ 998,412 $1,724,822
========== ==========
NET INCOME per unit $ 23.86 $ 41.23
========== ==========
UNITS OUTSTANDING 41,839 41,839
========== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
16
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-E
COMBINED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $1,219,608 $2,076,774
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 276,642 312,718
Gain on sale of oil and gas
properties - ( 1,149,051)
Decrease in accounts receivable -
oil and gas sales 13,907 367,750
Increase in accounts receivable -
General Partner ( 675,000) -
Decrease in accounts receivable -
other - 69,917
Decrease in accounts payable ( 138,071) ( 178,137)
---------- ----------
Net cash provided by operating
activities $ 697,086 $1,499,971
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 10,537) ($ 5,120)
Proceeds from sale of oil and
gas properties 563 1,279,412
---------- ----------
Net cash provided (used) by
investing activities ($ 9,974) $1,274,292
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($ 164,401) ($2,476,183)
---------- ----------
Net cash used by financing activities ($ 164,401) ($2,476,183)
---------- ----------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 522,711 $ 298,080
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 12,003 827,775
---------- ----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 534,714 $1,125,855
========== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
17
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-F
COMBINED BALANCE SHEETS
(Unaudited)
ASSETS
June 30, December 31,
1999 1998
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 1,649 $ 5,457
Accounts receivable:
Oil and gas sales 196,118 195,444
General Partner (Note 2) 472,500 -
---------- ----------
Total current assets $ 670,267 $ 200,901
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 1,232,854 1,311,368
DEFERRED CHARGE 346,704 346,704
---------- ----------
$2,249,825 $1,858,973
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 201,861 $ 406,740
Gas imbalance payable 38,738 38,738
---------- ----------
Total current liabilities $ 240,599 $ 445,478
ACCRUED LIABILITY $ 109,153 $ 109,153
PARTNERS' CAPITAL (DEFICIT):
General Partner $ 6,482 ($ 94,547)
Limited Partners, issued and
outstanding, 14,321 units 1,893,591 1,398,889
---------- ----------
Total Partners' capital $1,900,073 $1,304,342
---------- ----------
$2,249,825 $1,858,973
========== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
18
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-F
COMBINED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- ----------
REVENUES:
Oil and gas sales $296,738 $320,633
Interest income 751 4,545
Gain on sale of oil and
gas properties - 45,507
Insurance settlement 472,500 -
-------- --------
$769,989 $370,685
COSTS AND EXPENSES:
Lease operating $ 84,253 $118,870
Production tax 17,161 20,716
Depreciation, depletion, and
amortization of oil and gas
properties 44,513 47,513
General and administrative
(Note 2) 42,987 42,403
-------- --------
$188,914 $229,502
-------- --------
NET INCOME $581,075 $141,183
======== ========
GENERAL PARTNER - NET INCOME $ 93,281 $ 27,147
======== ========
LIMITED PARTNERS - NET INCOME $487,794 $114,036
======== ========
NET INCOME per unit $ 34.06 $ 7.96
======== ========
UNITS OUTSTANDING 14,321 14,321
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
19
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-F
COMBINED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
---------- -----------
REVENUES:
Oil and gas sales $511,194 $ 686,935
Interest income 761 7,719
Gain on sale of oil and
gas properties - 333,266
Insurance settlement 472,500 -
-------- ----------
$984,455 $1,027,920
COSTS AND EXPENSES:
Lease operating $177,452 $ 216,106
Production tax 31,171 44,390
Depreciation, depletion, and
amortization of oil and gas
properties 84,166 95,892
General and administrative
(Note 2) 95,935 93,876
-------- ----------
$388,724 $ 450,264
-------- ----------
NET INCOME $595,731 $ 577,656
======== ==========
GENERAL PARTNER - NET INCOME $101,029 $ 98,915
======== ==========
LIMITED PARTNERS - NET INCOME $494,702 $ 478,741
======== ==========
NET INCOME per unit $ 34.54 $ 33.43
======== ==========
UNITS OUTSTANDING 14,321 14,321
======== ==========
The accompanying condensed notes are an integral part of these
combined financial statements.
20
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
GEODYNE ENERGY INCOME PRODUCTION PARTNERSHIP I-F
COMBINED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(Unaudited)
1999 1998
-------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $595,731 $577,656
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, depletion, and
amortization of oil and gas
properties 84,166 95,892
Gain on sale of oil and gas
properties - ( 333,266)
(Increase) decrease in accounts
receivable - oil and gas sales ( 674) 102,750
Increase in accounts receivable -
General Partner ( 472,500) -
Decrease in accounts receivable -
other - 48,942
Decrease in accounts payable ( 204,879) ( 15,282)
-------- --------
Net cash provided by operating
activities $ 1,844 $476,692
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 7,333) ($ 2,180)
Proceeds from sale of oil and
gas properties 1,681 435,797
-------- --------
Net cash provided (used) by
investing activities ($ 5,652) $433,617
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions $ - ($885,693)
-------- --------
Net cash used by financing activities $ - ($885,693)
-------- --------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ($ 3,808) $ 24,616
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 5,457 251,220
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 1,649 $275,836
======== ========
The accompanying condensed notes are an integral part of these
combined financial statements.
21
GEODYNE ENERGY INCOME PROGRAM I LIMITED PARTNERSHIPS
CONDENSED NOTES TO THE COMBINED FINANCIAL STATEMENTS
JUNE 30, 1999
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The combined balance sheets as of June 30, 1999, combined statements of
operations for the three and six months ended June 30, 1999 and 1998, and
combined statements of cash flows for the six months ended June 30, 1999
and 1998 have been prepared by Geodyne Resources, Inc., the General
Partner of the limited partnerships, without audit. Each limited
partnership is a general partner in the related Geodyne Energy Income
Production Partnership in which Geodyne Resources, Inc. serves as the
managing partner. Unless the context indicates otherwise, all references
to a "Partnership" or the "Partnerships" are references to the limited
partnership and its related production partnership, collectively, and all
references to the "General Partner" are references to the general partner
of the limited partnerships and the managing partner of the production
partnerships, collectively. In the opinion of management the financial
statements referred to above include all necessary adjustments, consisting
of normal recurring adjustments, to present fairly the combined financial
position at June 30, 1999, the combined results of operations for the
three and six months ended June 30, 1999 and 1998, and the combined cash
flows for the six months ended June 30, 1999 and 1998.
Information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. The accompanying interim
financial statements should be read in conjunction with the Partnerships'
Annual Report on Form 10-K filed for the year ended December 31, 1998. The
results of operations for the period ended June 30, 1999 are not
necessarily indicative of the results to be expected for the full year.
The Limited Partners' net income or loss per unit is based upon each
$1,000 initial capital contribution.
22
OIL AND GAS PROPERTIES
----------------------
The Partnerships follow the successful efforts method of accounting for
their oil and gas properties. Under the successful efforts method, the
Partnerships capitalize all property acquisition costs and development
costs incurred in connection with the further development of oil and gas
reserves. Property acquisition costs include costs incurred by the
Partnerships or the General Partner to acquire producing properties,
including related title insurance or examination costs, commissions,
engineering, legal and accounting fees, and similar costs directly related
to the acquisitions, plus an allocated portion, of the General Partner's
property screening costs. The acquisition cost to the Partnerships of
properties acquired by the General Partner is adjusted to reflect the net
cash results of operations, including interest incurred to finance the
acquisition, for the period of time the properties are held by the General
Partner prior to their transfer to the Partnerships. Leasehold impairment
is recognized based upon an individual property assessment and exploratory
experience. Upon discovery of commercial reserves, leasehold costs are
transferred to producing properties.
Depletion of the costs of producing oil and gas properties, amortization
of related intangible drilling and development costs, and depreciation of
tangible lease and well equipment are computed on the unit-of-production
method. The Partnerships' depletion, depreciation, and amortization
includes estimated dismantlement and abandonment costs, net of estimated
salvage value.
When complete units of depreciable property are retired or sold, the asset
cost and related accumulated depreciation are eliminated with any gain or
loss reflected in income. When less than complete units of depreciable
property are retired or sold, the proceeds are credited to oil and gas
properties.
23
2. TRANSACTIONS WITH RELATED PARTIES
---------------------------------
The Partnerships' partnership agreements provide for reimbursement to the
General Partner for all direct general and administrative expenses and for
the general and administrative overhead applicable to the Partnerships
based on an allocation of actual costs incurred. During the three months
ended June 30, 1999 the following payments were made to the General
Partner or its affiliates by the Partnerships:
Direct General Administrative
Partnership and Administrative Overhead
----------- ------------------- ---------------
I-B $2,476 $ 11,313
I-C 2,156 23,382
I-D 2,052 19,986
I-E 7,839 116,220
I-F 3,207 39,780
During the six months ended June 30, 1999 the following payments were made
to the General Partner or its affiliates by the Partnerships:
Direct General Administrative
Partnership and Administrative Overhead
----------- ------------------- ---------------
I-B $13,260 $ 22,626
I-C 10,156 46,764
I-D 8,584 39,972
I-E 46,171 232,440
I-F 16,375 79,560
Affiliates of the Partnerships operate certain of the Partnerships'
properties and their policy is to bill the Partnerships for all customary
charges and cost reimbursements associated with their activities.
The accounts receivable - general partner at December 31, 1998 for the I-B
and I-C Partnerships represent refunds due for indirect general and
administrative expenses as a result of expense limitations imposed by the
Partnership Agreements. This receivable was collected during the first
quarter of 1999.
The accounts receivable - general partner at June 30, 1999 for the I-E and
I-F Partnerships represent proceeds from an insurance settlement discussed
below in Liquidity and Capital Resources. Such receivables were
subsequently collected and will be included in the I-E and I-F
Partnerships' August 1999 cash distributions.
24
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
USE OF FORWARD-LOOKING STATEMENTS AND ESTIMATES
- -----------------------------------------------
This Quarterly Report contains certain forward-looking statements. The
words "anticipate", "believe", "expect", "plan", "intend", "estimate",
"project", "could", "may" and similar expressions are intended to identify
forward-looking statements. Such statements reflect management's current
views with respect to future events and financial performance. This
Quarterly Report also includes certain information, which is, or is based
upon, estimates and assumptions. Such estimates and assumptions are
management's efforts to accurately reflect the condition and operation of
the Partnerships.
Use of forward-looking statements and estimates and assumptions involve
risks and uncertainties which include, but are not limited to, the
volatility of oil and gas prices, the uncertainty of reserve information,
the operating risk associated with oil and gas properties (including the
risk of personal injury, death, property damage, damage to the well or
producing reservoir, environmental contamination, and other operating
risks), the prospect of changing tax and regulatory laws, the availability
and capacity of processing and transportation facilities, the general
economic climate, the supply and price of foreign imports of oil and gas,
the level of consumer product demand, and the price and availability of
alternative fuels. Should one or more of these risks or uncertainties
occur or should estimates or underlying assumptions prove incorrect,
actual conditions or results may vary materially and adversely from those
stated, anticipated, believed, estimated, and otherwise indicated.
GENERAL
- -------
The Partnerships are engaged in the business of acquiring and operating
producing oil and gas properties located in the continental United States.
In general, a Partnership acquired producing properties and did not engage
in development drilling or enhanced recovery projects, except as an
incidental part of the management of the producing properties acquired.
Therefore, the economic life of each Partnership, and its related
Production Partnership, is limited to the period of time required to fully
produce its acquired oil and gas reserves. The net proceeds from the oil
and gas operations are distributed to the Limited Partners and the General
Partner in accordance with the terms of the Partnerships' partnership
agreements.
25
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnerships began operations and investors were assigned their rights
as Limited Partners, having made capital contributions in the amounts and
on the dates set forth below:
Limited
Date of Partner Capital
Partnership Activation Contributions
----------- ------------------ ---------------
I-B July 12, 1985 $11,957,700
I-C December 20, 1985 8,884,900
I-D March 4, 1986 7,194,700
I-E September 10, 1986 41,839,400
I-F December 16, 1986 14,320,900
In general, the amount of funds available for acquisition of producing
properties was equal to the capital contributions of the Limited Partners,
less 15% for sales commissions and organization and management fees. All
of the Partnerships have fully invested their capital contributions.
Net proceeds from the operations less necessary operating capital are
distributed to the Limited Partners on a quarterly basis. Revenues and net
proceeds of a Partnership are largely dependent upon the volumes of oil
and gas sold and the prices received for such oil and gas. While the
General Partner cannot predict future pricing trends, it believes the
working capital available as of June 30, 1999 and the net revenue
generated from future operations will provide sufficient working capital
to meet current and future obligations.
During the six months ended June 30, 1999, the I-B and I-C Partnerships
invested approximately $18,000 and $3,000, respectively, in the
recompletion of the Unit 30-11 #1 well located in Jefferson Davis County,
Mississippi in order to improve the recovery of reserves. This
recompletion was successful. The I-B and I-C Partnerships own 2.5% and
0.5% working interests, respectively, in this well.
In August 1999, the I-E and I-F Partnerships received insurance settlement
proceeds amounts of $675,000 and $472,500, respectively, for the costs
incurred to drill the State Lease 8191 No. 4 well in St. Bernard Parish,
Louisiana for the purpose of relieving pressure in another well which
suffered a blowout during a workover attempt. This new well was completed
as a producing gas well in 1998. The insurance proceeds amounts will be
included in the Partnerships' August 1999 cash distributions.
26
Pursuant to the terms of the Partnership Agreements, the Partnerships will
terminate on December 31, 1999. However, the Partnership Agreements
provide that the General Partner may extend the term of each Partnership
for up to five periods of two years each. As of the date of this Quarterly
Report the General Partner currently intends to extend the term of the
I-D, I-E, and I-F Partnerships for the first two year extension period.
With respect to the I-B and I-C Partnerships, it is the General Partner's
current intent to let these Partnerships terminate on December 31, 1999
pursuant to the terms of their Partnership Agreements.
The General Partner will, however, over the next several months evaluate
all of the Partnerships' operations and then make a final determination as
to whether to extend any of their terms. It is anticipated that a final
decision will be made during the fourth quarter of 1999.
RESULTS OF OPERATIONS
- ---------------------
GENERAL DISCUSSION
The following general discussion should be read in conjunction with the
analysis of results of operations provided below. The most important
variable affecting the Partnerships' revenues is the prices received for
the sale of oil and gas. Due to the volatility of oil and gas prices,
forecasting future prices is subject to great uncertainty and inaccuracy.
Substantially all of the Partnerships' gas reserves are being sold in the
"spot market". Prices on the spot market are subject to wide seasonal and
regional pricing fluctuations due to the highly competitive nature of the
spot market. Such spot market sales are generally short-term in nature and
are dependent upon the obtaining of transportation services provided by
pipelines. In addition, crude oil prices were recently at or near their
lowest level in the past decade due primarily to the global surplus of
crude oil. However, as of the date of this Quarterly Report oil prices
have rebounded primarily due to a decrease in the global oil surplus as a
result of production curtailments by several major oil producing nations.
Management is unable to predict whether future oil and gas prices will (i)
stabilize, (ii) increase, or (iii) decrease.
27
I-B PARTNERSHIP
THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED JUNE
30, 1998.
Three Months Ended June 30,
---------------------------
1999 1998
------- -------
Oil and gas sales $58,914 $59,328
Oil and gas production expenses $14,930 $16,796
Barrels produced 373 265
Mcf produced 29,215 28,541
Average price/Bbl $ 16.69 $ 11.15
Average price/Mcf $ 1.80 $ 1.98
As shown in the table above, total oil and gas sales decreased $414 (0.7%)
for the three months ended June 30, 1999 as compared to the three months
ended June 30, 1998. Of this decrease, approximately $5,000 was related to
a decrease in the average price of gas sold, which decrease was partially
offset by increases of approximately $1,200 and $1,300, respectively,
related to increases in volumes of oil and gas sold and approximately
$2,000 related to an increase in the average price of oil sold. Volumes of
oil and gas sold increased 108 barrels and 674 Mcf, respectively, for the
three months ended June 30, 1999 as compared to the three months ended
June 30, 1998. Average oil prices increased to $16.69 per barrel for the
three months ended June 30, 1999 from $11.15 per barrel for the three
months ended June 30, 1998. Average gas prices decreased to $1.80 per Mcf
for the three months ended June 30, 1999 from $1.98 per Mcf for the three
months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $1,866 (11.1%) for the three months ended June
30, 1999 as compared to the three months ended June 30, 1998. This
decrease was primarily due to a decrease in repair and maintenance
expenses incurred on two significant wells during the three months ended
June 30, 1999 as compared to the three months ended June 30, 1998. As a
percentage of oil and gas sales, these expenses decreased to 25.3% for the
three months ended June 30, 1999 from 28.3% for the three months ended
June 30, 1998. This percentage decrease was primarily due to the dollar
decrease in oil and gas production expenses and the increase in the
average price of oil sold.
28
Depreciation, depletion, and amortization of oil and gas properties
decreased $1,128 (9.8%) for the three months ended June 30, 1999 as
compared to the three months ended June 30, 1998. As a percentage of oil
and gas sales, this expense decreased to 17.7% for the three months ended
June 30, 1999 from 19.5% for the three months ended June 30, 1998.
General and administrative expenses increased $914 (7.1%) for the three
months ended June 30, 1999 as compared to the three months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
23.4% for the three months ended June 30, 1999 from 21.7% for the three
months ended June 30, 1998.
SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO THE SIX MONTHS ENDED JUNE 30,
1998.
Six Months Ended June 30,
-------------------------
1999 1998
-------- --------
Oil and gas sales $130,296 $120,200
Oil and gas production expenses $ 48,416 $ 35,939
Barrels produced 1,007 736
Mcf produced 70,425 52,879
Average price/Bbl $ 12.48 $ 13.17
Average price/Mcf $ 1.67 $ 2.09
As shown in the table above, total oil and gas sales increased $10,096
(8.4%) for the six months ended June 30, 1999 as compared to the six
months ended June 30, 1998. Of this increase, approximately $4,000 and
$37,000, respectively, were related to increases in volumes of oil and gas
sold, which increases were partially offset by a decrease of approximately
$30,000 related to a decrease in the average price of gas sold. Volumes of
oil and gas sold increased 271 barrels and 17,546 Mcf, respectively, for
the six months ended June 30, 1999 as compared to the six months ended
June 30, 1998. The increase in volumes of gas sold was primarily due to
(i) the successful drilling and completion of one well in late 1998 and
another well in early 1999 and (ii) the successful workover of one
significant well in late 1998 in order to improve the recovery of
reserves. The I-B Partnership has an overriding royalty interest in both
of the new wells. Average oil and gas prices decreased to $12.48 per
barrel and $1.67 per Mcf, respectively, for the six months ended June 30,
1999 from $13.17 per barrel and $2.09 per Mcf, respectively, for the six
months ended June 30, 1998.
29
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $12,477 (34.7%) for the six months ended June
30, 1999 as compared to the six months ended June 30, 1998. This increase
was primarily due to workover expenses incurred on one significant well
during the six months ended June 30, 1999 in order to improve the recovery
of reserves. As a percentage of oil and gas sales, these expenses
increased to 37.2% for the six months ended June 30, 1999 from 29.9% for
the six months ended June 30, 1998. This percentage increase was primarily
due to the decreases in the average prices of oil and gas sold and the
dollar increase in oil and gas production expenses.
Depreciation, depletion, and amortization of oil and gas properties
increased $86 (0.4%) for the six months ended June 30, 1999 as compared to
the six months ended June 30, 1998. As a percentage of oil and gas sales,
this expense decreased to 16.9% for the six months ended June 30, 1999
from 18.3% for the six months ended June 30, 1998.
General and administrative expenses increased $1,919 (5.6%) for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. As a percentage of oil and gas sales, these expenses decreased to
27.5% for the six months ended June 30, 1999 from 28.3% for the six months
ended June 30, 1998.
The Limited Partners have received cash distributions through June 30,
1999 totaling $6,740,527 or 56.37% of Limited Partners' capital
contributions.
I-C PARTNERSHIP
THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED JUNE
30, 1998.
Three Months Ended June 30,
---------------------------
1999 1998
-------- -------
Oil and gas sales $110,881 $95,699
Oil and gas production expenses $ 27,418 $53,609
Barrels produced 4,355 3,143
Mcf produced 23,457 31,455
Average price/Bbl $ 14.70 $ 11.45
Average price/Mcf $ 2.00 $ 1.90
As shown in the table above, total oil and gas sales increased $15,182
(15.9%) for the three months ended June 30, 1999 as compared to the three
months ended June 30, 1998. Of this increase, approximately $14,000 was
related to an increase in volumes of oil sold and approximately $14,000
and $2,000, respectively, were related to increases
30
in the average prices of oil and gas sold, which increases were partially
offset by a decrease of approximately $15,000 related to a decrease in
volumes of gas sold. Volumes of oil sold increased 1,212 barrels and
volumes of gas sold decreased 7,998 Mcf for the three months ended June
30, 1999 as compared to the three months ended June 30, 1998. The increase
in volumes of oil sold was primarily due to the sale of oil on several
wells which had previously been curtailed due to low oil prices, which
increase was partially offset by production difficulties on one
significant well. The decrease in volumes of gas sold was primarily due to
production difficulties on one significant well. Average oil and gas
prices increased to $14.70 per barrel and $2.00 per Mcf, respectively, for
the three months ended June 30, 1999 from $11.45 per barrel and $1.90 per
Mcf, respectively, for the three months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $26,191 (48.9%) for the three months ended
June 30, 1999 as compared to the three months ended June 30, 1998. This
decrease was primarily due to (i) a negative adjustment of prior period
lease operating expenses made by the operator on one significant well
during the three months ended June 30, 1999 and (ii) repair and
maintenance expenses incurred on one significant well during the three
months ended June 30, 1998. As a percentage of oil and gas sales, these
expenses decreased to 24.7% for the three months ended June 30, 1999 from
56.0% for the three months ended June 30, 1998. This percentage decrease
was primarily due to the dollar decrease in oil and gas production
expenses and the increases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $1,160 (20.6%) for the three months ended June 30, 1999 as
compared to the three months ended June 30, 1998. This increase was
primarily due to the increase in volumes of oil sold and downward
revisions in the estimates of remaining oil and gas reserves at December
31, 1998. As a percentage of oil and gas sales, this expense increased to
6.1% for the three months ended June 30, 1999 from 5.9% for the three
months ended June 30, 1998.
General and administrative expenses increased $989 (4.0%) for the three
months ended June 30, 1999 as compared to the three months ended June 30,
1998. As a percentage of oil and gas sales, these expenses decreased to
23.0% for the three months ended June 30, 1999 from 25.7% for the three
months ended June 30, 1998. This percentage decrease was primarily due to
the increase in oil and gas sales.
31
SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO THE SIX MONTHS ENDED JUNE 30,
1998.
Six Months Ended June 30,
-------------------------
1999 1998
-------- --------
Oil and gas sales $188,375 $282,095
Oil and gas production expenses $ 71,005 $111,007
Barrels produced 7,618 7,382
Mcf produced 50,023 72,092
Average price/Bbl $ 12.83 $ 12.45
Average price/Mcf $ 1.81 $ 2.64
As shown in the table above, total oil and gas sales decreased $93,720
(33.2%) for the six months ended June 30, 1999 as compared to the six
months ended June 30, 1998. Of this decrease, approximately $58,000 was
related to a decrease in volumes of gas sold and approximately $41,000 was
related to a decrease in the average price of gas sold. Volumes of oil
sold increased 236 barrels and volumes of gas sold decreased 22,069 Mcf
for the six months ended June 30, 1999 as compared to the six months ended
June 30, 1998. The decrease in volumes of gas sold was primarily due to
production difficulties on one significant well. Average oil prices
increased to $12.83 per barrel for the six months ended June 30, 1999 from
$12.45 per barrel for the six months ended June 30, 1998. Average gas
prices decreased to $1.81 per Mcf for the six months ended June 30, 1999
from $2.64 per Mcf for the six months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $40,002 (36.0%) for the six months ended June
30, 1999 as compared to the six months ended June 30, 1998. This decrease
was primarily due to (i) a refund of prior period ad valorem taxes made by
the operator on one significant well during the six months ended June 30,
1999, (ii) repair and maintenance expenses incurred on one significant
well during the six months ended June 30, 1998, and (iii) a negative
adjustment of prior period lease operating expenses made by the operator
on one significant well during the six months ended June 30, 1999. As a
percentage of oil and gas sales, these expenses decreased to 37.7% for the
six months ended June 30, 1999 from 39.4% for the six months ended June
30, 1998. This percentage decrease was primarily due to the dollar
decrease in oil and gas production expenses, which decrease was partially
offset by the decrease in the average price of gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $88 (0.7%) for the six months ended June 30, 1999 as compared to
the six months ended June 30, 1998. As a percentage of oil and gas sales,
this expense
32
increased to 6.9% for the six months ended June 30, 1999 from 4.6% for the
six months ended June 30, 1998. This percentage increase was primarily due
to the decrease in the average price of gas sold.
General and administrative expenses increased $1,759 (3.2%) for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
30.2% for the six months ended June 30, 1999 from 19.6% for the six months
ended June 30, 1998. This percentage increase was primarily due to the
decrease in oil and gas sales.
The Limited Partners have received cash distributions through June 30,
1999 totaling $8,263,300 or 93.0% of Limited Partners' capital
contributions.
I-D PARTNERSHIP
THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED JUNE
30, 1998.
Three Months Ended June 30,
---------------------------
1999 1998
-------- --------
Oil and gas sales $190,167 $186,722
Oil and gas production expenses $ 22,870 $ 40,413
Barrels produced 2,471 2,913
Mcf produced 71,934 78,709
Average price/Bbl $ 13.51 $ 11.95
Average price/Mcf $ 2.18 $ 1.93
As shown in the table above, total oil and gas sales increased $3,445
(1.8%) for the three months ended June 30, 1999 as compared to the three
months ended June 30, 1998. Of this increase, approximately $4,000 and
$18,000, respectively, were related to increases in the average prices of
oil and gas sold, which increases were partially offset by decreases of
approximately $5,000 and $13,000, respectively, related to decreases in
volumes of oil and gas sold. Volumes of oil and gas sold decreased 442
barrels and 6,775 Mcf, respectively, for the three months ended June 30,
1999 as compared to the three months ended June 30, 1998. The decrease in
volumes of gas sold was primarily due to production difficulties on one
significant well during the three months ended June 30, 1999, which
decrease was partially offset by a negative prior period volume adjustment
made by the operator on another significant well during the three months
ended June 30, 1998. Average oil and gas prices increased to $13.51 per
barrel and $2.18 per Mcf, respectively, for the three months ended June
30, 1999 from $11.95 per barrel and $1.93 per Mcf, respectively, for the
three months ended June 30, 1998.
33
The I-D Partnership sold certain oil and gas properties during the three
months ended June 30, 1998 and recognized a $108,746 gain on such sales.
No such gains were recognized on sales of oil and gas properties during
the three months ended June 30, 1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $17,543 (43.4%) for the three months ended
June 30, 1999 as compared to the three months ended June 30, 1998. This
decrease was primarily due to a negative adjustment of prior period lease
operating expenses made by the operator on one significant well during the
three months ended June 30, 1999. As a percentage of oil and gas sales,
these expenses decreased to 12.0% for the three months ended June 30, 1999
from 21.6% for the three months ended June 30, 1998. This percentage
decrease was primarily due to the dollar decrease in oil and gas
production expenses and the increases in the average prices of oil and gas
sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $1,041 (8.9%) for the three months ended June 30, 1999 as
compared to the three months ended June 30, 1998. As a percentage of oil
and gas sales, this expense increased to 6.7% for the three months ended
June 30, 1999 from 6.3% for the three months ended June 30, 1998.
General and administrative expenses increased $354 (1.6%) for the three
months ended June 30, 1999 as compared to the three months ended June 30,
1998. As a percentage of oil and gas sales, these expenses remained
constant at 11.6% for the three months ended June 30, 1999 and the three
months ended June 30, 1998.
SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO THE SIX MONTHS ENDED JUNE 30,
1998.
Six Months Ended June 30,
-------------------------
1999 1998
-------- --------
Oil and gas sales $322,393 $480,382
Oil and gas production expenses $ 76,354 $ 89,293
Barrels produced 4,809 6,333
Mcf produced 151,481 188,751
Average price/Bbl $ 12.23 $ 13.23
Average price/Mcf $ 1.74 $ 2.10
As shown in the table above, total oil and gas sales decreased $157,989
(32.9%) for the six months ended June 30, 1999 as compared to the six
months ended June 30, 1998. Of this decrease, approximately $20,000 and
$78,000,
34
respectively, were related to decreases in volumes of oil and gas sold and
approximately $5,000 and $55,000, respectively, were related to decreases
in the average prices of oil and gas sold. Volumes of oil and gas sold
decreased 1,524 barrels and 37,270 Mcf, respectively, for the six months
ended June 30, 1999 as compared to the six months ended June 30, 1998. The
decrease in volumes of oil sold was primarily due to production
difficulties on one significant well during the six months ended June 30,
1999. The decrease in volumes of gas sold was primarily due to production
difficulties on one significant well during the six months ended June 30,
1999 and the sale of several wells during 1998. Average oil and gas prices
decreased to $12.23 per barrel and $1.74 per Mcf, respectively, for the
six months ended June 30, 1999 from $13.23 per barrel and $2.10 per Mcf,
respectively, for the six months ended June 30, 1998.
The I-D Partnership sold certain oil and gas properties during the six
months ended June 30, 1998 and recognized a $255,796 gain on such sales.
No such gains were recognized on sales of oil and gas properties during
the six months ended June 30, 1999.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $12,939 (14.5%) for the six months ended June
30, 1999 as compared to the six months ended June 30, 1998. This decrease
was primarily due to (i) a decrease in production taxes associated with
the decrease in oil and gas sales and (ii) a negative adjustment of prior
period lease operating expenses made by the operator on one significant
well during the six months ended June 30, 1999. These decreases were
partially offset by workover expenses incurred on several wells during the
six months ended June 30, 1999 in order to improve the recovery of
reserves. As a percentage of oil and gas sales, these expenses increased
to 23.7% for the six months ended June 30, 1999 from 18.6% for the six
months ended June 30, 1998. This percentage increase was primarily due to
the workover expenses incurred in 1999 and the decreases in the average
prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $2,468 (8.9%) for the six months ended June 30, 1999 as compared
to the six months ended June 30, 1998. As a percentage of oil and gas
sales, this expense increased to 9.3% for the six months ended June 30,
1999 from 5.7% for the six months ended June 30, 1998. This percentage
increase was primarily due to the decreases in the average prices of oil
and gas sold.
35
General and administrative expenses increased $989 (2.1%) for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
15.1% for the six months ended June 30, 1999 from 9.9% for the six months
ended June 30, 1998. This percentage increase was primarily due to the
decrease in oil and gas sales.
The Limited Partners have received cash distributions through June 30,
1999 totaling $14,218,175 or 197.62% of Limited Partners' capital
contributions.
I-E PARTNERSHIP
THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED JUNE
30, 1998.
Three Months Ended June 30,
---------------------------
1999 1998
-------- ----------
Oil and gas sales $949,135 $1,026,695
Oil and gas production expenses $258,894 $ 312,114
Barrels produced 14,779 17,876
Mcf produced 382,850 434,138
Average price/Bbl $ 14.86 $ 11.53
Average price/Mcf $ 1.91 $ 1.89
As shown in the table above, total oil and gas sales decreased $77,560
(7.6%) for the three months ended June 30, 1999 as compared to the three
months ended June 30, 1998. Of this decrease, approximately $36,000 and
$97,000, respectively, were related to decreases in volumes of oil and gas
sold, which decreases were partially offset by an increase of $49,000
related to an increase in the average price of oil sold. Volumes of oil
and gas sold decreased 3,097 barrels and 51,288 Mcf, respectively, for the
three months ended June 30, 1999 as compared to the three months ended
June 30, 1998. The decrease in volumes of oil sold was primarily due to
(i) positive prior period volume adjustments made by the purchaser on
three significant wells during the three months ended June 30, 1998 and
(ii) normal declines in production. The decrease in volumes of gas sold
was primarily due to positive prior period volume adjustments made by the
purchaser on two significant wells during the three months ended June 30,
1998. Average oil and gas prices increased to $14.86 per barrel and $1.91
per Mcf, respectively, for the three months ended June 30, 1999 from
$11.53 per barrel and $1.89 per Mcf, respectively, for the three months
ended June 30, 1998.
36
The I-E Partnership sold certain oil and gas properties during the three
months ended June 30, 1998 and recognized a $489,455 gain on such sales.
No such gains were recognized on sales of oil and gas properties during
the three months ended June 30, 1999.
As discussed in Liquidity and Capital Resources above, the I-E Partnership
recognized an insurance settlement in the amount of $675,000 during the
three months ended June 30, 1999. No similar settlements occurred during
the three months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $53,220 (17.1%) for the three months ended
June 30, 1999 as compared to the three months ended June 30, 1998. This
decrease was primarily due to workover expenses incurred on several wells
during the three months ended June 30, 1998 in order to improve the
recovery of reserves and abandonment expenses incurred on two wells during
the three months ended June 30, 1998. As a percentage of oil and gas
sales, these expenses decreased to 27.3% for the three months ended June
30, 1999 from 30.4% for the three months ended June 30, 1998. This
percentage decrease was primarily due to the dollar decrease in oil and
gas production expenses.
Depreciation, depletion, and amortization of oil and gas properties
decreased $20,611 (12.9%) for the three months ended June 30, 1999 as
compared to the three months ended June 30, 1998. This decrease was
primarily due to the decreases in volumes of oil and gas sold. As a
percentage of oil and gas sales, this expense decreased to 14.7% for the
three months ended June 30, 1999 from 15.6% for the three months ended
June 30, 1998.
General and administrative expenses increased $1,627 (1.3%) for the three
months ended June 30, 1999 as compared to the three months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
13.1% for the three months ended June 30, 1999 from 11.9% for the three
months ended June 30, 1998. This percentage increase was primarily due to
the decrease in oil and gas sales.
37
SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO THE SIX MONTHS ENDED JUNE 30,
1998.
Six Months Ended June 30,
-------------------------
1999 1998
---------- ----------
Oil and gas sales $1,654,037 $2,092,070
Oil and gas production expenses $ 557,345 $ 601,078
Barrels produced 31,011 33,859
Mcf produced 751,705 856,909
Average price/Bbl $ 12.58 $ 13.15
Average price/Mcf $ 1.68 $ 1.92
As shown in the table above, total oil and gas sales decreased $438,033
(20.9%) for the six months ended June 30, 1999 as compared to the six
months ended June 30, 1998. Of this decrease, approximately $202,000 was
related to a decrease in volumes of gas sold and approximately $181,000
was related to a decrease in the average price of gas sold. Volumes of oil
and gas sold decreased 2,848 barrels and 105,204 Mcf, respectively, for
the six months ended June 30, 1999 as compared to the six months ended
June 30, 1998. The decrease in volumes of gas sold was primarily due to
the sale of several wells during 1998 and positive prior period volume
adjustments made by the purchaser on two significant wells during the six
months ended June 30, 1998. Average oil and gas prices decreased to $12.58
per barrel and $1.68 per Mcf, respectively, for the six months ended June
30, 1999 from $13.15 per barrel and $1.92 per Mcf, respectively, for the
six months ended June 30, 1998.
The I-E Partnership sold certain oil and gas properties during the six
months ended June 30, 1998 and recognized a $1,149,051 gain on such sales.
No such gains were recognized on sales of oil and gas properties during
the six months ended June 30, 1999.
As discussed in Liquidity and Capital Resources above, the I-E Partnership
recognized an insurance settlement in the amount of $675,000 during the
six months ended June 30, 1999. No similar settlements occurred during the
six months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $43,733 (7.3%) for the six months ended June
30, 1999 as compared to the six months ended June 30, 1998. As a
percentage of oil and gas sales, these expenses increased to 33.7% for the
six months ended June 30, 1999 from 28.7% for the six months ended June
30, 1998. This percentage increase was primarily due to the decreases in
the average prices of oil and gas sold.
38
Depreciation, depletion, and amortization of oil and gas properties
decreased $36,076 (11.5%) for the six months ended June 30, 1999 as
compared to the six months ended June 30, 1998. This decrease was
primarily due to the decreases in volumes of oil and gas sold. As a
percentage of oil and gas sales, this expense increased to 16.7% for the
six months ended June 30, 1999 from 14.9% for the six months ended June
30, 1998. This percentage increase was primarily due to the decreases in
the average prices of oil and gas sold.
General and administrative expenses increased $5,761 (2.1%) for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
16.8% for the six months ended June 30, 1999 from 13.0% for the six months
ended June 30, 1998. This percentage increase was primarily due to the
decrease in oil and gas sales.
The Limited Partners have received cash distributions through June 30,
1999 totaling $53,731,552 or 128.42% of Limited Partners' capital
contributions.
I-F PARTNERSHIP
THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED JUNE
30, 1998.
Three Months Ended June 30,
---------------------------
1999 1998
-------- --------
Oil and gas sales $296,738 $320,633
Oil and gas production expenses $101,414 $139,586
Barrels produced 7,180 8,327
Mcf produced 101,289 107,539
Average price/Bbl $ 14.99 $ 11.74
Average price/Mcf $ 1.87 $ 2.07
As shown in the table above, total oil and gas sales decreased $23,895
(7.5%) for the three months ended June 30, 1999 as compared to the three
months ended June 30, 1998. Of this decrease, approximately $13,000 and
$13,000, respectively, were related to decreases in volumes of oil and gas
sold and approximately $21,000 was related to a decrease in the average
price of gas sold, which decreases were partially offset by an increase of
approximately $23,000 related to an increase in the average price of oil
sold. Volumes of oil and gas sold decreased 1,147 barrels and 6,250 Mcf,
respectively, for the three months ended June 30, 1999 as compared to the
three months ended June 30, 1998. The decrease in volumes of oil sold was
primarily due to (i) positive prior period volume adjustments made by the
39
purchaser on three significant wells during the three months ended June
30, 1999 and (ii) normal declines in production. Average oil prices
increased to $14.99 per barrel for the three months ended June 30, 1999
from $11.74 per barrel for the three months ended June 30, 1998. Average
gas prices decreased to $1.87 per Mcf for the three months ended June 30,
1999 from $2.07 per Mcf for the three months ended June 30, 1998.
The I-F Partnership sold certain oil and gas properties during the three
months ended June 30, 1998 and recognized a $45,507 gain on such sales. No
such gains were recognized on sales of oil and gas properties during the
three months ended June 30, 1999.
As discussed in Liquidity and Capital Resources above, the I-F Partnership
recognized an insurance settlement in the amount of $472,500 during the
three months ended June 30, 1999. No similar settlements occurred during
the three months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $38,172 (27.3%) for the three months ended
June 30, 1999 as compared to the three months ended June 30, 1998. This
decrease was primarily due to workover expenses incurred on several wells
during the three months ended June 30, 1998 in order to improve the
recovery of reserves and abandonment expenses incurred on two wells during
the three months ended June 30, 1998. As a percentage of oil and gas
sales, these expenses decreased to 34.2% for the three months ended June
30, 1999 from 43.5% for the three months ended June 30, 1998. This
percentage decrease was primarily due to the dollar decrease in oil and
gas production expenses.
Depreciation, depletion, and amortization of oil and gas properties
decreased $3,000 (6.3%) for the three months ended June 30, 1999 as
compared to the three months ended June 30, 1998. As a percentage of oil
and gas sales, this expense increased to 15.0% for the three months ended
June 30, 1999 from 14.8% for the three months ended June 30, 1998.
General and administrative expenses increased $584 (1.4%) for the three
months ended June 30, 1999 as compared to the three months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
14.5% for the three months ended June 30, 1999 from 13.2% for the three
months ended June 30, 1998.
40
SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO THE SIX MONTHS ENDED JUNE 30,
1998.
Six months Ended June 30,
-------------------------
1999 1998
-------- --------
Oil and gas sales $511,194 $686,935
Oil and gas production expenses $208,623 $260,496
Barrels produced 14,960 16,194
Mcf produced 183,211 220,708
Average price/Bbl $ 12.69 $ 13.32
Average price/Mcf $ 1.75 $ 2.14
As shown in the table above, total oil and gas sales decreased $175,741
(25.6%) for the six months ended June 30, 1999 as compared to the six
months ended June 30, 1998. Of this decrease, approximately $80,000 was
related to a decrease in volumes of gas sold and approximately $70,000 was
related to a decrease in the average price of gas sold. Volumes of oil and
gas sold decreased 1,234 barrels and 37,497 Mcf, respectively, for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. The decrease in volumes of gas sold was primarily due to (i) the
sale of several wells during 1998, (ii) a negative prior period volume
adjustment made by the purchaser on one significant well during the six
months ended June 30, 1999, and (iii) normal declines in production.
Average oil and gas prices decreased to $12.69 per barrel and $1.75 per
Mcf, respectively, for the six months ended June 30, 1999 from $13.32 per
barrel and $2.14 per Mcf, respectively, for the six months ended June 30,
1998.
The I-F Partnership sold certain oil and gas properties during the six
months ended June 30, 1998 and recognized a $333,266 gain on such sales.
No such gains were recognized on sales of oil and gas properties during
the six months ended June 30, 1999.
As discussed in Liquidity and Capital Resources above, the I-F Partnership
recognized an insurance settlement in the amount of $472,500 during the
six months ended June 30, 1999. No similar settlements occurred during the
six months ended June 30, 1998.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $51,873 (19.9%) for the six months ended June
30, 1999 as compared to the six months ended June 30, 1998. This decrease
was primarily due to (i) workover expenses incurred on several wells
during the six months ended June 30, 1998 in order to improve the recovery
of reserves and (ii) a decrease in production taxes associated with the
decrease in oil and gas sales. As a
41
percentage of oil and gas sales, these expenses increased to 40.8% for the
six months ended June 30, 1999 from 37.9% for the six months ended June
30, 1998. This percentage increase was primarily due to the decreases in
the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $11,726 (12.2%) for the six months ended June 30, 1999 as
compared to the six months ended June 30, 1998. This decrease was
primarily due to the decreases in volumes of oil and gas sold. As a
percentage of oil and gas sales, this expense increased to 16.5% for the
six months ended June 30, 1999 from 14.0% for the six months ended June
30, 1998. This percentage increase was primarily due to the decreases in
the average prices of oil and gas sold.
General and administrative expenses increased $2,059 (2.2%) for the six
months ended June 30, 1999 as compared to the six months ended June 30,
1998. As a percentage of oil and gas sales, these expenses increased to
18.8% for the six months ended June 30, 1999 from 13.7% for the six months
ended June 30, 1998. This percentage increase was primarily due to the
decrease in oil and gas sales.
The Limited Partners have received cash distributions through June 30,
1999 totaling $17,986,664 or 125.60% of Limited Partners' capital
contributions.
YEAR 2000 COMPUTER ISSUES
- -------------------------
IN GENERAL
The Year 2000 Issue ("Y2K") refers to the inability of computer and other
information technology systems to properly process date and time
information, stemming from the earlier programming practice of using two
digits rather than four to represent the year in a date. For example,
computer programs and imbedded chips that are date sensitive may recognize
a date using (00) as the year 1900 rather than the year 2000. The
consequence of Y2K is that computer and imbedded processing systems may be
at risk of malfunctioning, particularly during the transition from 1999 to
2000.
The effects of Y2K are exacerbated by the interdependence of computer and
telecommunication systems throughout the world. This interdependence also
exists among the Partnerships, Samson Investment Company and its
affiliates ("Samson"), and their vendors, customers, and business
partners, as well as with regulators. The potential risks associated with
Y2K for an oil and gas production company fall into three general
42
areas: (i) financial, leasehold and administrative computer systems, (ii)
imbedded systems in field process control units, and (iii) third party
exposures. As discussed below, General Partner does not believe that these
risks will be material to the Partnerships' operations.
The Partnerships' business is producing oil and gas. The day-to-day
production of the Partnerships' oil and gas is not dependent on computers
or equipment with imbedded chips. As further discussed below, management
anticipates that the Partnerships' daily business activities will not be
materially affected by Y2K.
The Partnerships rely on Samson to provide all of their operational and
administrative services on either a direct or indirect basis. Samson is
addressing each of the three Y2K areas discussed above through a readiness
process that seeks to:
1. increase the awareness of the issue among key employees;
2. identify areas of potential risk;
3. assess the relative impact of these risks and Samson's ability to
manage them; and
4. remediate these risks on a priority basis wherever possible.
One of Samson Investment Company's Executive Vice Presidents is
responsible for communicating to its Board of Directors Y2K actions and
for the ultimate implementation of its Y2K plan. He has delegated to
Samson Investment Company's Senior Vice President-Technology and
Administrative Services principal responsibility for ensuring Y2K
compliance within Samson.
Samson has been planning for the impact of Y2K on its information
technology systems since 1993. As of July 15, 1999, Samson is in the final
stages of implementation of a Y2K plan, as summarized below:
FINANCIAL AND ADMINISTRATIVE SYSTEMS
1. Awareness. Samson has alerted its officers, managers and supervisors of
Y2K issues and asked them to have their employees participate in the
identification of potential Y2K risks which might otherwise go unnoticed
by higher level employees and officers. As a result, awareness of the
issue is considered high.
43
2. Risk Identification. Samson's most significant financial and
administrative systems exposure is the Y2K status of the accounting and
land administration system used to collect and manage data for internal
management decision making and for external revenue and accounts payable
purposes. Other concerns include network hardware and software, desktop
computing hardware and software, telecommunications, and office space
readiness.
3. Risk Assessment. The failure to identify and correct a material Y2K
problem could result in inaccurate or untimely financial information for
management decision-making or cash flow and payment purposes, including
maintaining oil and gas leases.
4. Remediation. Since 1993, Samson has been upgrading its accounting and
land administration software. Substantially all of the Y2K upgrades have
been completed, with the remainder scheduled to be completed during the
3rd quarter of 1999. In addition, in 1997 and 1998 Samson replaced or
applied software patches to substantially all of its network and desktop
software applications and believes them to be generally Y2K compliant.
Additional patches or software upgrades will be applied no later than
September 30, 1999 to complete this process. The costs of all such risk
assessments and remediation are not expected to be material to the
Partnerships.
5. Contingency Planning. Notwithstanding the foregoing, should there be
significant unanticipated disruptions in Samson's financial and
administrative systems, all of the accounting processes that are currently
automated will need to be performed manually. Samson has communicated to
its management team the importance of having adequate staff available to
manually perform necessary functions to minimize disruptions.
IMBEDDED SYSTEMS
1. Awareness. Samson's Y2K program has involved all levels of field
personnel from production foremen and higher. Employees at all levels of
the organization have been asked to participate in the identification of
potential Y2K risks, which might otherwise go unnoticed by higher level
employees and officers of Samson, and as a result, awareness of the issue
is considered high.
2. Risk Identification. Samson has inventoried all possible
exposures to imbedded chips and systems. Such exposures can be
classified as either (i) oil and gas
44
production and processing equipment or (ii) office machines such as faxes,
copiers, phones, etc.
With respect to oil and gas production and processing equipment, neither
Samson nor the Partnerships operate offshore wells, significant processing
plants, or wells with older electronic monitoring systems. As a result,
Samson's inventory identified less than 10 applications using imbedded
chips. All of these have been tested by the respective vendors and have
been found to be Y2K compliant or have been upgraded or replaced.
Office machines have been tested by Samson and vendors and are believed to
be compliant.
3. Risk Assessment and Remediation. The failure to identify and correct a
material Y2K problem in an imbedded system could result in outcomes
ranging from errors in data reporting to curtailments or shutdowns in
production. As noted above, Samson has identified less than 10 imbedded
system applications all of which have been made compliant or replaced.
None of these applications are believed to be material to Samson or the
Partnerships. Samson believes that sufficient manual processes are
available to minimize any field level risk and that there will be no
material impact on the Partnerships with respect to these applications.
4. Contingency Planning. Should material production disruptions occur as a
result of Y2K failures in field operations, Samson will utilize its
existing field personnel in an attempt to avoid any material impact on
operating cash flow. Samson is not able to quantify any potential exposure
in the event of systems failure or inadequate manual alternatives.
THIRD PARTY EXPOSURES
1. Awareness. Samson has advised management to consider Y2K implications
with its outside vendors, customers, and business partners. Management has
been asked to participate in the identification of potential third party
Y2K risks and, as a result, awareness of the issue is considered high.
2. Risk Identification. Samson's most significant third party Y2K exposure
is its dependence on third parties for the receipt of revenues from oil
and gas sales. However, virtually all of these purchasers are very large
and sophisticated companies. Other Y2K concerns include the availability
of electric power to Samson's field operations, the integrity of
telecommunication systems, and the readiness of commercial banks to
execute electronic fund transfers.
45
3. Risk Assessment. Because of the high awareness of the Y2K problem in
the U.S., Samson has not undertaken and does not plan to undertake a
formal company wide plan to make inquiries of third parties on the subject
of Y2K readiness. If it did so, Samson has no ability to require responses
to such inquiries or to independently verify their accuracy. Samson has,
however, received oral assurances from its significant oil and gas
purchasers of Y2K compliance. If significant disruptions from major
purchasers were to occur, however, there could be a material and adverse
impact on the Partnerships' results of operations, liquidity, and
financial conditions.
It is important to note that third party oil and gas purchasers have
significant incentives to avoid disruptions arising from a Y2K failure.
For example, most of these parties are under contractual obligations to
purchase oil and gas or disperse revenues to Samson. The failure to do so
will result in contractual and statutory penalties. Therefore, Samson
believes that it is unlikely that there will be material third party
non-compliance with purchase and remittance obligations as a result of Y2K
issues.
4. Remediation. Where Samson perceives significant risk of Y2K
non-compliance that may have a material impact on it, and where the
relationship between Samson and a vendor, customer, or business partner
permits, joint testing may be undertaken during the remainder of 1999 to
further identify these risks.
5. Contingency Planning. In the unlikely event that material production
disruptions occur as a result of Y2K failures of third parties, the
Partnerships' operating cash flow could be impacted. This contingency will
be factored into deliberations on the level of quarterly cash
distributions paid out during any such period of cash flow disruption.
46
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
The Partnerships do not hold any market risk sensitive instruments.
47
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27.1 Financial Data Schedule containing summary financial
information extracted from the I-B Partnership's
financial statements as of June 30, 1999 and for the six
months ended June 30, 1999, filed herewith.
27.2 Financial Data Schedule containing summary financial
information extracted from the I-C Partnership's
financial statements as of June 30, 1999 and for the six
months ended June 30, 1999, filed herewith.
27.3 Financial Data Schedule containing summary financial
information extracted from the I-D Partnership's
financial statements as of June 30, 1999 and for the six
months ended June 30, 1999, filed herewith.
27.4 Financial Data Schedule containing summary financial
information extracted from the I-E Partnership's
financial statements as of June 30, 1999 and for the six
months ended June 30, 1999, filed herewith.
27.5 Financial Data Schedule containing summary financial
information extracted from the I-F Partnership's
financial statements as of June 30, 1999 and for the six
months ended June 30, 1999, filed herewith.
All other exhibits are omitted as inapplicable.
(b) Reports on Form 8-K.
None.
48
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.
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-B
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-C
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-D
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-E
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP I-F
(Registrant)
BY: GEODYNE RESOURCES, INC.
General Partner
Date: August 12, 1999 By: /s/Dennis R. Neill
--------------------------------
(Signature)
Dennis R. Neill
President
Date: August 12, 1999 By: /s/Patrick M. Hall
--------------------------------
(Signature)
Patrick M. Hall
Principal Accounting Officer
49
INDEX TO EXHIBITS
NUMBER DESCRIPTION
- ------ -----------
27.1 Financial Data Schedule containing summary financial information
extracted from the Geodyne Energy Income Limited Partnership I-B's
financial statements as of June 30, 1999 and for the six months
ended June 30, 1999, filed herewith.
27.2 Financial Data Schedule containing summary financial information
extracted from the Geodyne Energy Income Limited Partnership I-C's
financial statements as of June 30, 1999 and for the six months
ended June 30, 1999, filed herewith.
27.3 Financial Data Schedule containing summary financial information
extracted from the Geodyne Energy Income Limited Partnership I-D's
financial statements as of June 30, 1999 and for the six months
ended June 30, 1999, filed herewith.
27.4 Financial Data Schedule containing summary financial information
extracted from the Geodyne Energy Income Limited Partnership I-E's
financial statements as of June 30, 1999 and for the six months
ended June 30, 1999, filed herewith.
27.5 Financial Data Schedule containing summary financial information
extracted from the Geodyne Energy Income Limited Partnership I-F's
financial statements as of June 30, 1999 and for the six months
ended June 30, 1999, filed herewith.
All other exhibits are omitted as inapplicable.
50