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 March 31, 2005
Commission File Number:
III-A: 0-18302 III-B: 0-18636 III-C: 0-18634
III-D: 0-18936 III-E: 0-19010 III-F: 0-19102
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
---------------------------------------------------------
(Exact name of Registrant as specified in its Articles)
III-A 73-1352993
III-B 73-1358666
III-C 73-1356542
III-D 73-1357374
III-E 73-1367188
Oklahoma III-F 73-1377737
- ---------------------------- -------------------------------
(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
------ ------
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes No X
------ ------
-1-
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 970,093 $1,038,719
Accounts receivable:
Oil and gas sales 598,773 588,829
---------- ----------
Total current assets $1,568,866 $1,627,548
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 744,739 761,804
DEFERRED CHARGE 187,958 187,958
---------- ----------
$2,501,563 $2,577,310
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 209,772 $ 84,554
Gas imbalance payable 26,709 26,709
Asset retirement obligation -
current (Note 1) 6,589 18,336
---------- ----------
Total current liabilities $ 243,070 $ 129,599
LONG-TERM LIABILITIES:
Accrued liability $ 28,718 $ 28,718
Asset retirement obligation
(Note 1) 109,516 96,619
---------- ----------
Total long-term liabilities $ 138,234 $ 125,337
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 108,498) ($ 88,506)
Limited Partners, issued and
outstanding, 263,976 units 2,228,757 2,410,880
---------- ----------
Total Partners' capital $2,120,259 $2,322,374
---------- ----------
$2,501,563 $2,577,310
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-2-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
REVENUES:
Oil and gas sales $1,033,696 $1,004,030
Interest income 3,881 869
Gain on sale of oil and gas
properties - 1,399
---------- ----------
$1,037,577 $1,006,298
COSTS AND EXPENSES:
Lease operating $ 263,228 $ 146,641
Production tax 99,120 85,753
Depreciation, depletion, and
amortization of oil and gas
properties 23,989 72,031
General and administrative
(Note 2) 94,964 79,569
---------- ----------
$ 481,301 $ 383,994
---------- ----------
NET INCOME $ 556,276 $ 622,304
========== ==========
GENERAL PARTNER - NET INCOME $ 57,399 $ 68,626
========== ==========
LIMITED PARTNERS - NET INCOME $ 498,877 $ 553,678
========== ==========
NET INCOME per unit $ 1.89 $ 2.10
========== ==========
UNITS OUTSTANDING 263,976 263,976
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-3-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
------------ ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 556,276 $622,304
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 23,989 72,031
Gain on sale of oil and gas
properties - ( 1,399)
Settlement of asset retirement
obligation - ( 165)
Increase in accounts receivable -
oil and gas sales ( 9,944) ( 60,269)
Increase in accounts payable 129,599 15,760
---------- --------
Net cash provided by operating
activities $ 699,920 $648,262
---------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 10,155) ($ 24,164)
Proceeds from sale of oil and gas
properties - 1,367
---------- --------
Net cash used by investing activities ($ 10,155) ($ 22,797)
---------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($ 758,391) ($533,629)
---------- --------
Net cash used by financing activities ($ 758,391) ($533,629)
---------- --------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ($ 68,626) $ 91,836
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 1,038,719 804,593
---------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 970,093 $896,429
========== ========
The accompanying condensed notes are an integral part of
these financial statements.
-4-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 474,508 $ 556,249
Accounts receivable:
Oil and gas sales 317,218 300,554
---------- ----------
Total current assets $ 791,726 $ 856,803
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 393,920 402,168
DEFERRED CHARGE 120,451 120,451
---------- ----------
$1,306,097 $1,379,422
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 137,363 $ 55,739
Gas imbalance payable 14,760 14,760
Asset retirement obligation -
current (Note 1) 26,223 31,869
---------- ----------
Total current liabilities $ 178,346 $ 102,368
LONG-TERM LIABILITIES:
Accrued liability $ 9,828 $ 9,828
Asset retirement obligation
(Note 1) 54,416 47,996
---------- ----------
Total long-term liabilities $ 64,244 $ 57,824
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 78,173) ($ 58,429)
Limited Partners, issued and
outstanding, 138,336 units 1,141,680 1,277,659
---------- ----------
Total Partners' capital $1,063,507 $1,219,230
---------- ----------
$1,306,097 $1,379,422
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-5-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
-------- --------
REVENUES:
Oil and gas sales $525,153 $489,401
Interest income 1,992 429
-------- --------
$527,145 $489,830
COSTS AND EXPENSES:
Lease operating $161,378 $ 87,212
Production tax 55,862 44,673
Depreciation, depletion, and
amortization of oil and gas
properties 4,530 44,677
General and administrative
(Note 2) 60,250 44,117
-------- --------
$282,020 $220,679
-------- --------
NET INCOME $245,125 $269,151
======== ========
GENERAL PARTNER - NET INCOME $ 37,104 $ 46,563
======== ========
LIMITED PARTNERS - NET INCOME $208,021 $222,588
======== ========
NET INCOME per unit $ 1.50 $ 1.61
======== ========
UNITS OUTSTANDING 138,336 138,336
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-6-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $245,125 $269,151
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 4,530 44,677
Settlement of asset retirement
obligation - ( 109)
Increase in accounts receivable -
oil and gas sales ( 16,664) ( 31,075)
Increase in accounts payable 83,971 3,581
-------- --------
Net cash provided by operating
activities $316,962 $286,225
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 328) ($ 15,959)
Proceeds from sale of oil and gas
properties 2,473 -
-------- --------
Net cash provided (used) by investing
activities $ 2,145 ($ 15,959)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($400,848) ($268,483)
-------- --------
Net cash used by financing activities ($400,848) ($268,483)
-------- --------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ($ 81,741) $ 1,783
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 556,249 417,271
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $474,508 $419,054
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-7-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 868,902 $ 682,792
Accounts receivable:
Oil and gas sales 628,486 583,009
---------- ----------
Total current assets $1,497,388 $1,265,801
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 1,475,532 1,475,924
DEFERRED CHARGE 48,684 48,684
---------- ----------
$3,021,604 $2,790,409
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 163,968 $ 123,591
Gas imbalance payable 83,181 83,181
Asset retirement obligation -
current (Note 1) 27,005 38,950
---------- ----------
Total current liabilities $ 274,154 $ 245,722
LONG-TERM LIABILITIES:
Accrued liability $ 170,532 $ 170,532
Asset retirement obligation
(Note 1) 180,831 165,722
---------- ----------
Total long-term liabilities $ 351,363 $ 336,254
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 148,360) ($ 136,932)
Limited Partners, issued and
outstanding, 244,536 units 2,544,447 2,345,365
---------- ----------
Total Partners' capital $2,396,087 $2,208,433
---------- ----------
$3,021,604 $2,790,409
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-8-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
-------- --------
REVENUES:
Oil and gas sales $954,505 $848,497
Interest income 2,423 765
Gain on sale of oil and gas
properties - 140
Other income 1,741 -
-------- --------
$958,669 $849,402
COSTS AND EXPENSES:
Lease operating $156,333 $130,017
Production tax 64,819 59,792
Depreciation, depletion, and
amortization of oil and gas
properties 52,036 57,225
General and administrative
(Note 2) 89,518 74,008
-------- --------
$362,706 $321,042
-------- --------
NET INCOME $595,963 $528,360
======== ========
GENERAL PARTNER - NET INCOME $ 63,881 $ 57,910
======== ========
LIMITED PARTNERS - NET INCOME $532,082 $470,450
======== ========
NET INCOME per unit $ 2.18 $ 1.92
======== ========
UNITS OUTSTANDING 244,536 244,536
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-9-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $595,963 $528,360
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 52,036 57,225
Gain on sale of oil and gas
properties - ( 140)
Increase in accounts receivable -
oil and gas sales ( 45,477) ( 60,321)
Increase in accounts payable 30,654 2,969
-------- --------
Net cash provided by operating
activities $633,176 $528,093
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 38,757) ($ 13,817)
Proceeds from sale of oil and gas
properties - 140
-------- --------
Net cash used by investing activities ($ 38,757) ($ 13,677)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($408,309) ($487,125)
-------- --------
Net cash used by financing activities ($408,309) ($487,125)
-------- --------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $186,110 $ 27,291
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 682,792 711,441
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $868,902 $738,732
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-10-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 483,763 $ 432,834
Accounts receivable:
Oil and gas sales 368,491 340,185
---------- ----------
Total current assets $ 852,254 $ 773,019
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 581,148 589,161
DEFERRED CHARGE 8,429 8,429
---------- ----------
$1,441,831 $1,370,609
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 85,393 $ 131,321
Gas imbalance payable 41,607 41,607
Asset retirement obligation -
current (Note 1) 3,814 11,975
---------- ----------
Total current liabilities $ 130,814 $ 184,903
LONG-TERM LIABILITIES:
Accrued liability $ 191,685 $ 191,685
Asset retirement obligation
(Note 1) 106,617 97,207
---------- ----------
Total long-term liabilities $ 298,302 $ 288,892
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 59,007) ($ 55,158)
Limited Partners, issued and
outstanding, 131,008 units 1,071,722 951,972
---------- ----------
Total Partners' capital $1,012,715 $ 896,814
---------- ----------
$1,441,831 $1,370,609
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-11-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- --------
REVENUES:
Oil and gas sales $535,061 $503,917
Interest income 1,397 448
Gain on sale of oil and gas
properties - 19
Other income 249 -
-------- --------
$536,707 $504,384
COSTS AND EXPENSES:
Lease operating $ 88,145 $ 79,102
Production tax 36,578 36,072
Depreciation, depletion, and
amortization of oil and gas
properties 17,037 23,436
General and administrative
(Note 2) 58,146 41,968
-------- --------
$199,906 $180,578
-------- --------
INCOME FROM CONTINUING OPERATIONS $336,801 $323,806
Income from discontinued
operations (Note 3) - 2,288
-------- --------
NET INCOME $336,801 $326,094
======== ========
GENERAL PARTNER - NET INCOME $ 35,051 $ 34,927
======== ========
LIMITED PARTNERS - NET INCOME $301,750 $291,167
======== ========
NET INCOME per unit $ 2.30 $ 2.22
======== ========
UNITS OUTSTANDING 131,008 131,008
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-12-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $336,801 $326,094
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 17,037 26,254
Gain on sale of oil and gas
properties - ( 19)
Increase in accounts receivable
- oil and gas sales ( 28,306) ( 51,055)
Increase (decrease) in accounts
payable ( 48,893) 35,335
-------- --------
Net cash provided by operating
activities $276,639 $336,609
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 4,810) ($ 3,458)
-------- --------
Net cash used by investing activities ($ 4,810) ($ 3,458)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($220,900) ($315,134)
-------- --------
Net cash used by financing activities ($220,900) ($315,134)
-------- --------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 50,929 $ 18,017
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 432,834 438,562
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $483,763 $456,579
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-13-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $1,345,136 $1,413,497
Accounts receivable:
Oil and gas sales 761,485 849,754
---------- ----------
Total current assets $2,106,621 $2,263,251
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 1,902,439 1,942,054
DEFERRED CHARGE 48,978 48,978
---------- ----------
$4,058,038 $4,254,283
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 259,209 $ 768,152
Gas imbalance payable 5,643 5,643
Asset retirement obligation -
current (Note 1) 15,403 28,411
---------- ----------
Total current liabilities $ 280,255 $ 802,206
LONG-TERM LIABILITIES:
Accrued liability $ 301,594 $ 301,594
Asset retirement obligation
(Note 1) 203,840 188,764
---------- ----------
Total long-term liabilities $ 505,434 $ 490,358
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 272,807) ($ 316,058)
Limited Partners, issued and
outstanding, 418,266 units 3,545,156 3,277,777
---------- ----------
Total Partners' capital $3,272,349 $2,961,719
---------- ----------
$4,058,038 $4,254,283
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-14-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
REVENUES:
Oil and gas sales $1,216,684 $1,136,092
Interest income 4,549 1,470
---------- ----------
$1,221,233 $1,137,562
COSTS AND EXPENSES:
Lease operating $ 274,873 $ 234,805
Production tax 84,095 76,386
Depreciation, depletion, and
amortization of oil and gas
properties 43,786 34,788
General and administrative
(Note 2) 137,518 123,032
---------- ----------
$ 540,272 $ 469,011
---------- ----------
NET INCOME FROM CONTINUING OPERATIONS $ 680,961 $ 668,551
Income from discontinued
operations (Note 3) - 17,093
---------- ----------
NET INCOME $ 680,961 $ 685,644
========== ==========
GENERAL PARTNER - NET INCOME $ 71,582 $ 73,279
========== ==========
LIMITED PARTNERS - NET INCOME $ 609,379 $ 612,365
========== ==========
NET INCOME per unit $ 1.46 $ 1.46
========== ==========
UNITS OUTSTANDING 418,266 418,266
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-15-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 680,961 $ 685,644
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 43,786 54,023
(Increase) decrease in accounts
receivable - oil and gas sales 88,269 ( 172,373)
Increase (decrease) in accounts
payable ( 500,577) 179,593
---------- ----------
Net cash provided by operating
activities $ 312,439 $ 746,887
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 10,469) ($ 10,484)
---------- ----------
Net cash used by investing activities ($ 10,469) ($ 10,484)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($ 370,331) ($ 935,831)
---------- ----------
Net cash used by financing activities ($ 370,331) ($ 935,831)
---------- ----------
NET DECREASE IN CASH AND CASH
EQUIVALENTS ($ 68,361) ($ 199,428)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 1,413,497 1,513,224
---------- ----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $1,345,136 $1,313,796
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-16-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
BALANCE SHEETS
(Unaudited)
ASSETS
March 31, December 31,
2005 2004
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 782,892 $ 696,460
Accounts receivable:
Oil and gas sales 562,327 548,005
---------- ----------
Total current assets $1,345,219 $1,244,465
NET OIL AND GAS PROPERTIES, utilizing
the successful efforts method 1,694,397 1,727,931
DEFERRED CHARGE 21,947 21,947
---------- ----------
$3,061,563 $2,994,343
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 114,666 $ 92,446
Gas imbalance payable 4,721 4,721
Asset retirement obligation -
current (Note 1) 6,024 8,552
---------- ----------
Total current liabilities $ 125,411 $ 105,719
LONG-TERM LIABILITIES:
Accrued liability $ 105,877 $ 105,877
Asset retirement obligation
(Note 1) 145,873 141,647
---------- ----------
Total long-term liabilities $ 251,750 $ 247,524
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 143,070) ($ 142,055)
Limited Partners, issued and
outstanding, 221,484 units 2,827,472 2,783,155
---------- ----------
Total Partners' capital $2,684,402 $2,641,100
---------- ----------
$3,061,563 $2,994,343
========== ==========
The accompanying condensed notes are an integral part of
these financial statements.
-17-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
-------- --------
REVENUES:
Oil and gas sales $819,952 $645,565
Interest income 2,585 542
-------- --------
$822,537 $646,107
COSTS AND EXPENSES:
Lease operating $163,857 $144,713
Production tax 43,993 34,270
Depreciation, depletion, and
amortization of oil and gas
properties 37,151 26,972
General and administrative
(Note 2) 83,143 67,646
-------- --------
$328,144 $273,601
-------- --------
NET INCOME $494,393 $372,506
======== ========
GENERAL PARTNER - NET INCOME $ 26,076 $ 19,677
======== ========
LIMITED PARTNERS - NET INCOME $468,317 $352,829
======== ========
NET INCOME per unit $ 2.11 $ 1.59
======== ========
UNITS OUTSTANDING 221,484 221,484
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-18-
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
(Unaudited)
2005 2004
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $494,393 $372,506
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, depletion, and
amortization of oil and gas
properties 37,151 26,972
Increase in accounts receivable
- oil and gas sales ( 14,322) ( 46,830)
Increase (decrease) in accounts
payable 28,213 ( 14,171)
-------- --------
Net cash provided by operating
activities $545,435 $338,477
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ($ 7,912) $ -
Proceeds from the sale of oil
and gas properties - 138
-------- --------
Net cash provided (used) by investing
activities ($ 7,912) $ 138
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions ($451,091) ($315,209)
-------- --------
Net cash used by financing activities ($451,091) ($315,209)
-------- --------
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 86,432 $ 23,406
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 696,460 521,918
-------- --------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $782,892 $545,324
======== ========
The accompanying condensed notes are an integral part of
these financial statements.
-19-
GEODYNE ENERGY INCOME PROGRAM III LIMITED PARTNERSHIPS
CONDENSED NOTES TO THE FINANCIAL STATEMENTS
MARCH 31, 2005
(Unaudited)
1. ACCOUNTING POLICIES
-------------------
The balance sheets as of March 31, 2005, statements of operations for the
three months ended March 31, 2005 and 2004, and statements of cash flows
for the three months ended March 31, 2005 and 2004 have been prepared by
Geodyne Resources, Inc., the General Partner of the Partnerships (the
"General Partner"), without audit. In the opinion of management the
financial statements referred to above include all necessary adjustments,
consisting of normal recurring adjustments, to present fairly the
financial position at March 31, 2005, the results of operations for the
three months ended March 31, 2005 and 2004, and the cash flows for the
three months ended March 31, 2005 and 2004.
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, 2004. The
results of operations for the period ended March 31, 2005 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 $100
initial capital contribution.
DISCONTINUED OPERATIONS
-----------------------
As further described in Note 3, the III-D and III-E Partnerships sold all
of their oil and gas assets held in the Jay-Little Escambia Creek Field
("Jay Field") on May 12, 2004 at a large public oil and gas auction.
-20-
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.
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 and estimated
salvage value of the equipment.
When complete units of depreciable property are retired or sold, the asset
cost and related accumulated depreciation are eliminated with any gain or
loss (including the elimination of the asset retirement obligation)
reflected in income. When less than complete units of depreciable property
are retired or sold, the proceeds are credited to oil and gas properties.
ASSET RETIREMENT OBLIGATIONS
----------------------------
The Partnerships' wells must be properly plugged and abandoned after their
oil and gas reserves are exhausted. The Partnerships follow FAS No. 143,
"Accounting for Asset Retirement Obligations" in accounting for the future
expenditures that will be necessary to plug and abandon these wells. FAS
No. 143 requires the estimated plugging and abandonment obligations to be
recognized in the period in which they are incurred (i.e. when the well is
drilled or acquired) if a reasonable estimate of fair value can be made
and to be capitalized as part of the carrying amount of the well.
-21-
The asset retirement obligation will be adjusted upwards each quarter in
order to recognize accretion of the time-related discount factor. For the
three months ended March 31, 2005, the III-A, III-B, III-C, III-D, III-E,
and III-F Partnerships recognized approximately $1,000, $1,000, $3,000,
$1,000, $3,000, and $2,000, respectively, of an increase in depreciation,
depletion, and amortization expense, which was comprised of accretion of
the asset retirement obligation and depletion of the increase in
capitalized cost of oil and gas properties.
The components of the change in asset retirement obligations for the three
months ended March 31, 2005 and 2004 are as shown below.
III-A Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $114,955 $114,993
Settlements and disposals - ( 4,865)
Accretion expense 1,150 948
-------- --------
Total Asset Retirement
Obligation, End of Quarter $116,105 $111,076
======== ========
Asset Retirement Obligation -
Current $ 6,589 $ 12,314
Asset Retirement Obligation -
Long-Term 109,516 98,762
-22-
III-B Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $ 79,865 $ 83,211
Settlements and disposals - ( 3,209)
Accretion expense 774 670
-------- --------
Total Asset Retirement
Obligation, End of Quarter $ 80,639 $ 80,672
======== ========
Asset Retirement Obligation -
Current $ 26,223 $ 27,865
Asset Retirement Obligation -
Long-Term 54,416 52,807
III-C Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $204,672 $194,453
Additions and revisions 1,069 1,022
Accretion expense 2,095 1,726
-------- --------
Total Asset Retirement
Obligation, End of Quarter $207,836 $197,201
======== ========
Asset Retirement Obligation -
Current $ 27,005 $ 32,237
Asset Retirement Obligation -
Long-Term 180,831 164,964
-23-
III-D Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $109,182 $ 314,031
Additions and revisions 155 146
Accretion expense 1,094 3,672
Discontinued operations - ( 212,827)
-------- ----------
Total Asset Retirement
Obligation, End of Quarter $110,431 $ 105,022
======== ==========
Asset Retirement Obligation -
Current $ 3,814 $ 9,829
Asset Retirement Obligation -
Long-Term 106,617 95,193
III-E Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $217,175 $1,768,863
Accretion expense 2,068 20,844
Discontinued operations - ( 1,573,603)
-------- ----------
Total Asset Retirement
Obligation, End of Quarter $219,243 $ 216,104
======== ==========
Asset Retirement Obligation -
Current $ 15,403 $ 18,205
Asset Retirement Obligation -
Long-Term 203,840 197,899
-24-
III-F Partnership
-----------------
Three months Three months
Ended Ended
3/31/2005 3/31/2004
------------ ------------
Total Asset Retirement
Obligation, January 1 $150,199 $142,977
Accretion expense 1,698 1,543
-------- --------
Total Asset Retirement
Obligation, End of Quarter $151,897 $144,520
======== ========
Asset Retirement Obligation -
Current $ 6,024 $ 4,466
Asset Retirement Obligation -
Long-Term 145,873 140,054
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 March 31, 2005, the following payments were made to the General
Partner or its affiliates by the Partnerships:
Direct General Administrative
Partnership and Administrative Overhead
----------- ------------------- ---------------
III-A $25,496 $ 69,468
III-B 23,845 36,405
III-C 25,165 64,353
III-D 23,670 34,476
III-E 27,448 110,070
III-F 24,859 58,284
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.
-25-
3. DISCONTINUED OPERATIONS
-----------------------
On May 12, 2004 the III-D and III-E Partnerships sold all of their
interest in the Jay Field located in Santa Rosa County, Florida at a large
public oil and gas auction for approximately $721,000, subject to standard
transaction requirements and adjustments. These proceeds were allocated
approximately $89,000 and $632,000, respectively, to the III-D and III-E
Partnerships. This represents the sale of all oil and gas assets held by
the III-D and III-E Partnerships in the Jay Field and is therefore a
disposal of a business segment under Statement of Financial Accounting
Standards No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets" (FAS 144). The sale resulted in a gain on disposal of
discontinued operations of approximately $10,000 and $89,000,
respectively, for the III-D and III-E Partnerships. Accordingly, prior
year results of the Jay Field segment have been classified as
discontinued.
Results from discontinued operations for the three months ended March 31,
2004 were as follows:
III-D III-E
Partnership Partnership
------------ ------------
Oil and gas sales $127,438 $909,368
Lease operating ( 114,158) ( 814,709)
Production tax ( 8,174) ( 58,331)
Depreciation, depletion, and
amortization of oil and gas
properties ( 2,818) ( 19,235)
-------- --------
Income from discontinued
operations $ 2,288 $ 17,093
======== ========
-26-
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.
DISCONTINUED OPERATIONS
- -----------------------
The III-D and III-E Partnerships owned working interests in the Jay Field
located in Santa Rosa County, Florida. This property, consisting of
several oil and gas producing wells, several nitrogen gas injection wells
(to stimulate production), and a gas plant, is operated by ExxonMobil. The
injection process leads to very high operating costs. As a result, changes
in oil (in particular) and natural gas prices can significantly impact net
cash flow and the estimated net present value of this property's proved
reserves. Based on information received from the operator, in late 2001
through early 2004 this property experienced mechanical and operational
difficulties primarily associated with the nitrogen injection system and
gas plant operations. Also, the drilling of a directional well
significantly exceeded the operator's original cost estimates. The
operator notified the working interest owners that
-27-
additional costs would be incurred in order to plug several wells. As a
result of these costs, cash flow from this property had been reduced and
at times had been negative. This property is very sensitive to changes in
oil prices and production volumes.
In May 2004, the III-D and III-E Partnerships sold all of their interests
in the Jay Field and the disposal was treated as a discontinued operation.
The sales proceeds consisting of approximately $89,000 and $632,000,
respectively, were included in the August 15, 2004 cash distributions to
the III-D and III-E Partnerships. The sale of the Jay Field interests will
impact the continuing future operations of the III-D and III-E
Partnerships. It is anticipated that these Partnerships will have lower
lease operating costs, lower oil and gas sales, and a reduction in their
asset retirement obligations. The reader should refer to Note 3 -
Discontinued Operations to the consolidated financial statements included
in PART I, ITEM 1 of this Quarterly Report on Form 10-Q for additional
information regarding this matter.
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 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.
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:
-28-
Limited
Date of Partner Capital
Partnership Activation Contributions
----------- ------------------ ---------------
III-A November 22, 1989 $26,397,600
III-B January 24, 1990 13,833,600
III-C February 27, 1990 24,453,600
III-D September 5, 1990 13,100,800
III-E December 26, 1990 41,826,600
III-F March 7, 1991 22,148,400
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 March 31, 2005 and the net revenue
generated from future operations will provide sufficient working capital
to meet current and future obligations.
Occasional expenditures for new wells or well recompletions or workovers
may, however, reduce or eliminate cash available for a particular
quarterly distribution.
Pursuant to the terms of the Partnership Agreements for the Partnerships
(the "Partnership Agreements") the Partnerships were initially scheduled
to terminate on the dates indicated in the "Initial Termination Date"
column of the following chart. 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 has extended the terms of the Partnerships for their
third extension period. Therefore, the Partnerships are currently
scheduled to terminate on the dates indicated in the "Current Termination
Date" column of the following chart.
Initial Extensions Current
Partnership Termination Date Exercised Termination Date
----------- ----------------- --------- -----------------
III-A November 22, 1999 3 November 22, 2005
III-B January 24, 2000 3 December 31, 2005
III-C February 28, 2000 3 December 31, 2005
III-D September 5, 2000 3 December 31, 2005
III-E December 26, 2000 3 December 31, 2005
III-F March 7, 2001 3 December 31, 2005
-29-
The General Partner has not determined whether it will further extend the
terms of any Partnership.
CRITICAL ACCOUNTING POLICIES
- ----------------------------
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 the
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.
Depletion of the cost 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' calculation of depreciation, depletion, and
amortization includes estimated dismantlement and abandonment costs and
estimated salvage value of the equipment. When complete units of
depreciable property are retired or sold, the asset cost and related
accumulated depreciation are eliminated with any gain or loss (including
the elimination of the asset retirement obligation) reflected in income.
When less that complete units of depreciable property are retired or sold,
the proceeds are credited to oil and gas properties.
The Partnerships evaluate the recoverability of the carrying costs of
their proved oil and gas properties for each oil and gas field (rather
than separately for each well). If the unamortized costs of oil and gas
properties within a field exceeds the expected undiscounted future cash
flows from such properties, the cost of the properties is written down to
fair value, which is determined by using the estimated discounted future
cash flows from the properties. The risk that the Partnerships will be
required to record impairment provisions in the future increases as oil
and gas prices decrease.
The Deferred Charge on the Balance Sheets represents costs deferred for
lease operating expenses incurred in connection with the Partnerships'
underproduced gas imbalance positions. Conversely, the Accrued Liability
represents charges accrued for lease operating expenses incurred in
-30-
connection with the Partnerships' overproduced gas imbalance positions.
The rate used in calculating the Deferred Charge and Accrued Liability is
the annual average production costs per Mcf.
The Partnerships' oil and condensate production is sold, title passed, and
revenue recognized at or near the Partnerships' wells under short-term
purchase contracts at prevailing prices in accordance with arrangements
which are customary in the oil and gas industry. Sales of gas applicable
to the Partnerships' interest in producing oil and gas leases are recorded
as revenue when the gas is metered and title transferred pursuant to the
gas sales contracts covering the Partnerships' interest in gas reserves.
During such times as a Partnership's sales of gas exceed its pro rata
ownership in a well, such sales are recorded as revenues unless total
sales from the well have exceeded the Partnership's share of estimated
total gas reserves underlying the property, at which time such excess is
recorded as a liability. The rates per Mcf used to calculate this
liability are based on the average gas prices for which the Partnerships
are currently settling this liability. These amounts were recorded as gas
imbalance payables in accordance with the sales method. These gas
imbalance payables will be settled by either gas production by the
underproduced party in excess of current estimates of total gas reserves
for the well or by negotiated or contractual payment to the underproduced
party.
ASSET RETIREMENT OBLIGATIONS
- ----------------------------
The Partnerships' wells must be properly plugged and abandoned after their
oil and gas reserves are exhausted. The Partnerships follow FAS No. 143,
"Accounting for Asset Retirement Obligations" in accounting for the future
expenditures that will be necessary to plug and abandon these wells. FAS
No. 143 requires the estimated plugging and abandonment obligations to be
recognized in the period in which they are incurred (i.e. when the well is
drilled or acquired) if a reasonable estimate of fair value can be made
and to be capitalized as part of the carrying amount of the well.
NEW ACCOUNTING PRONOUNCEMENTS
- -----------------------------
The Partnerships are not aware of any recently issued accounting
pronouncements that would have an impact on the Partnerships' future
results of operations and financial position.
-31-
PROVED RESERVES AND NET PRESENT VALUE
- -------------------------------------
The process of estimating oil and gas reserves is complex, requiring
significant subjective decisions in the evaluation of available
geological, engineering, and economic data for each reservoir. The data
for a given reservoir may change substantially over time as a result of,
among other things, additional development activity, production history,
and viability of production under varying economic conditions;
consequently, it is reasonably possible that material revisions to
existing reserve estimates may occur in the future. Although every
reasonable effort has been made to ensure that these reserve estimates
represent the most accurate assessment possible, the significance of the
subjective decisions required and variances in available data for various
reservoirs make these estimates generally less precise than other
estimates presented in connection with financial statement disclosures.
The following tables summarize changes in net quantities of the
Partnerships' proved reserves, all of which are located in the United
States, for the periods indicated. The proved reserves were estimated by
petroleum engineers employed by affiliates of the Partnerships, and are
annually reviewed by an independent engineering firm. "Proved reserves"
refers to those estimated quantities of crude oil, gas, and gas liquids
which geological and engineering data demonstrate with reasonable
certainty to be recoverable in future years from known oil and gas
reservoirs under existing economic and operating conditions. The following
information includes certain gas balancing adjustments which cause the gas
volume to differ from the reserve reports prepared by the General Partner.
III-A Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2004 123,403 3,772,737
Production ( 8,034) ( 108,487)
Extensions and discoveries 774 12,699
Revisions of previous
estimates 3,094 69,293
------- ---------
Proved reserves, March 31, 2005 119,237 3,746,242
======= =========
-32-
III-B Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2004 74,694 1,557,071
Production ( 5,398) ( 44,794)
Extensions and discoveries 502 6,191
Revisions of previous
estimates 2,659 27,821
------ ---------
Proved reserves, March 31, 2005 72,457 1,546,289
====== =========
III-C Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2004 81,674 4,632,503
Production ( 2,469) ( 134,206)
Extensions and discoveries 39 55,001
Revisions of previous
estimates 7,915 102,271
------ ---------
Proved reserves, March 31, 2005 87,159 4,655,569
====== =========
III-D Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2004 81,073 2,409,961
Production ( 2,399) ( 76,715)
Extensions and discoveries 4 7,610
Revisions of previous
estimates 6,793 54,632
------ ---------
Proved reserves, March 31, 2005 85,471 2,395,488
====== =========
-33-
III-E Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- ------------
Proved reserves, Dec. 31, 2004 158,508 6,440,079
Production ( 6,185) ( 172,223)
Extensions and discoveries 11 2,322
Revisions of previous
estimates 6,975 59,406
------- ---------
Proved reserves, March 31, 2005 159,309 6,329,584
======= =========
III-F Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2004 314,866 4,140,725
Production ( 5,389) ( 100,250)
Extensions and discoveries 9 1,950
Revisions of previous
estimates 6,292 3,196
------- ---------
Proved reserves, March 31, 2005 315,778 4,045,621
======= =========
The net present value of the Partnerships' reserves may change
dramatically as oil and gas prices change or as volumes change for the
reasons described above. Net present value represents estimated future
gross cash flow from the production and sale of proved reserves, net of
estimated oil and gas production costs (including production taxes, ad
valorem taxes, and operating expenses) and estimated future development
costs, discounted at 10% per annum.
The following table indicates the estimated net present value of the
Partnerships' proved reserves as of March 31, 2005 and December 31, 2004.
Net present value attributable to the Partnerships' proved reserves was
calculated on the basis of current costs and prices as of the date of
estimation. Such prices were not escalated except in certain circumstances
where escalations were fixed and readily determinable in accordance with
applicable contract provisions. The table also indicates the gas prices in
effect on the dates corresponding to the reserve valuations. Changes in
the oil and gas prices cause the estimates of
-34-
remaining economically recoverable reserves, as well as the values placed
on said reserves to fluctuate. The prices used in calculating the net
present value attributable to the Partnerships' proved reserves do not
necessarily reflect market prices for oil and gas production subsequent to
March 31, 2005. There can be no assurance that the prices used in
calculating the net present value of the Partnerships' proved reserves at
March 31, 2005 will actually be realized for such production.
Net Present Value of Reserves
-------------------------------------------
Partnership 3/31/05 12/31/04
----------- ----------- -----------
III-A $14,546,731 $12,009,256
III-B 6,764,144 5,576,342
III-C 14,227,089 11,292,927
III-D 7,969,895 6,265,244
III-E 21,237,057 17,294,504
III-F 16,358,502 13,190,015
Oil and Gas Prices
-------------------------------------------
Pricing 3/31/05 12/31/04
----------- ----------- -----------
Oil (Bbl) $ 55.31 $ 43.36
Gas (Mcf) 7.17 6.02
RESULTS OF OPERATIONS
- ---------------------
GENERAL DISCUSSION
The following general discussion should be read in conjunction with the
analysis of results of operations provided below.
The primary source of liquidity and Partnership cash distributions comes
from the net revenues generated from the sale of oil and gas produced from
the Partnerships' oil and gas properties. The level of net revenues is
highly dependent upon the total volumes of oil and natural gas sold. Oil
and gas reserves are depleting assets and will experience production
declines over time, thereby likely resulting in reduced net revenues. The
level of net revenues is also highly dependent upon the prices received
for oil and gas sales, which prices have historically been very volatile
and may continue to be so.
Additionally, lower oil and natural gas prices may reduce the amount of
oil and gas that is economic to produce and reduce the Partnerships'
revenues and cash flow. Various factors beyond the Partnerships' control
will affect prices for oil and natural gas, such as:
-35-
* Worldwide and domestic supplies of oil and natural gas;
* The ability of the members of the Organization of Petroleum
Exporting Countries ("OPEC") to agree to and maintain oil prices
and production quotas;
* Political instability or armed conflict in oil-producing regions
or around major shipping areas;
* The level of consumer demand and overall economic activity;
* The competitiveness of alternative fuels;
* Weather conditions;
* The availability of pipelines for transportation; and
* Domestic and foreign government regulations and taxes.
It is not possible to predict the future direction of oil or natural gas
prices or whether the above discussed trends will remain. Operating costs,
including General and Administrative Expenses, may not decline over time
or may experience only a gradual decline, thus adversely affecting net
revenues as either production or oil and natural gas prices decline. In
any particular period, net revenues may also be affected by either the
receipt of proceeds from property sales or the incursion of additional
costs as a result of well workovers, recompletions, new well drilling, and
other events.
In addition to pricing, the level of net revenues is also highly dependent
upon the total volumes of oil and natural gas sold. Oil and gas reserves
are depleting assets and will experience production declines over time,
thereby likely resulting in reduced net revenues. Despite this general
trend of declining production, several factors can cause the volumes of
oil and gas sold to increase or decrease at an even greater rate over a
given period. These factors include, but are not limited to, (i)
geophysical conditions which cause an acceleration of the decline in
production, (ii) the shutting in of wells (or the opening of previously
shut-in wells) due to low oil and gas prices (or high oil and gas prices),
mechanical difficulties, loss of a market or transportation, or
performance of workovers, recompletions, or other operations in the well,
(iii) prior period volume adjustments (either positive or negative) made
by the purchasers of the production, (iv) ownership adjustments in
accordance with agreements governing the operation or ownership of the
well (such as adjustments that occur at payout), and (v) completion of
enhanced recovery projects which increase production for the well. Many of
these factors are very significant as related to a single well or as
related to many wells over a short period of time. However, due to the
large number of wells owned by the Partnerships, these factors are
generally not material as compared to the normal declines in production
experienced on all remaining wells.
-36-
III-A PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
---------- ----------
Oil and gas sales $1,033,696 $1,004,030
Oil and gas production expenses $ 362,348 $ 232,394
Barrels produced 8,034 10,018
Mcf produced 108,487 126,475
Average price/Bbl $ 45.38 $ 33.64
Average price/Mcf $ 6.17 $ 5.27
As shown in the table above, total oil and gas sales increased $29,666
(3.0%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately $94,000 and
$97,000, respectively, were related to increases in the average prices of
oil and gas sold. These increases were partially offset by decreases of
approximately $66,000 and $95,000, respectively, related to decreases in
volumes of oil and gas sold. Volumes of oil and gas sold decreased 1,984
barrels and 17,988 Mcf, respectively, for the three months ended March 31,
2005 as compared to the three months ended March 31, 2004. The decrease in
volumes of oil sold was primarily due to (i) the shutting-in of one
significant well during late 2004 and early 2005 due to mechanical
problems and (ii) normal declines in production. As of the date of this
Quarterly Report, the shut-in well has returned to production at a lower
rate than previously experienced. The decrease in volumes of gas sold was
primarily due to (i) a positive prior period volume adjustment made by the
operator on one significant well during the three months ended March 31,
2004, (ii) the shutting-in of one significant well during late 2004 and
early 2005 due to mechanical problems, and (iii) normal declines in
production. As of the date of this Quarterly Report, the shut-in well has
returned to production at a lower rate than previously experienced.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $129,954 (55.9%) for the three months ended
March 31, 2005 as compared to the three months ended March 31, 2004. This
increase was primarily due to (i) workover expenses incurred on several
wells during the three months ended March 31, 2005, (ii) a positive prior
period production tax adjustment made by the operator on one significant
well during the three months ended March 31, 2005, and (iii) an increase
in salt water disposal expenses incurred on several wells during the three
months ended March 31, 2005 as compared to the three months ended March
31, 2004. These increases were partially offset by a negative prior period
production tax adjustment made by the operator on another significant well
during the three months ended March 31, 2005. As a percentage of oil and
gas
-37-
sales, these expenses increased to 35.1% for the three months ended March
31, 2005 from 23.1% for the three months ended March 31, 2004. This
percentage increase was primarily due to the dollar increase in oil and
gas production expenses.
Depreciation, depletion, and amortization of oil and gas properties
decreased $48,042 (66.7%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This decrease was
primarily due to (i) the abandonment of one significant well during the
three months ended March 31, 2004 following an unsuccessful recompletion
attempt and (ii) the decreases in volumes of oil and gas sold. As a
percentage of oil and gas sales, this expense decreased to 2.3% for the
three months ended March 31, 2005 from 7.2% for the three months ended
March 31, 2004. This percentage decrease was primarily due to the dollar
decrease in depreciation, depletion, and amortization of oil and gas
properties.
General and administrative expenses increased $15,395 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses increased to 9.2% for
the three months ended March 31, 2005 from 7.9% for the three months ended
March 31, 2004. This percentage increase was primarily due to the dollar
increase in general and administrative expenses.
The Limited Partners have received cash distributions through March 31,
2005 totaling $39,577,701 or 149.93% of Limited Partners' capital
contributions.
III-B PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
---------- ---------
Oil and gas sales $525,153 $489,401
Oil and gas production expenses $217,240 $131,885
Barrels produced 5,398 7,027
Mcf produced 44,794 47,281
Average price/Bbl $ 45.58 $ 33.32
Average price/Mcf $ 6.23 $ 5.40
As shown in the table above, total oil and gas sales increased $35,752
(7.3%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately $66,000 and
$37,000, respectively, were related to increases in the average prices of
oil and gas sold. These increases were partially offset by decreases of
approximately $54,000 and $13,000, respectively, related to decreases in
volumes of oil and gas
-38-
sold. Volumes of oil and gas sold decreased 1,629 barrels and 2,487 Mcf,
respectively, for the three months ended March 31, 2005 as compared to the
three months ended March 31, 2004. The decrease in volumes of oil sold was
primarily due to (i) the shutting-in of one significant well during late
2004 and early 2005 due to mechanical problems and (ii) normal declines in
production. As of the date of this Quarterly Report, the shut-in well has
returned to production at a lower rate than previously experienced. The
decrease in volumes of gas sold was primarily due to (i) the shutting-in
of one significant well during late 2004 and early 2005 due to mechanical
problems and (ii) normal declines in production. As of the date of this
Quarterly Report, the shut-in well has returned to production.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $85,355 (64.7%) for the three months ended
March 31, 2005 as compared to the three months ended March 31, 2004. This
increase was primarily due to (i) workover expenses incurred on several
wells during the three months ended March 31, 2005, (ii) a positive prior
period production tax adjustment made by the operator on one significant
well during the three months ended March 31, 2005, and (iii) an increase
in salt water disposal expenses incurred on several wells during the three
months ended March 31, 2005 as compared to the three months ended March
31, 2004. These increases were partially offset by a negative prior period
production tax adjustment made by the operator on another significant well
during the three months ended March 31, 2005. As a percentage of oil and
gas sales, these expenses increased to 41.4% for the three months ended
March 31, 2005 from 26.9% for the three months ended March 31, 2004. This
percentage increase was primarily due to the dollar increase in oil and
gas production expenses.
Depreciation, depletion, and amortization of oil and gas properties
decreased $40,147 (89.9%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This decrease was
primarily due to (i) the abandonment of one significant well during the
three months ended March 31, 2004 following an unsuccessful recompletion
attempt, (ii) the decreases in volumes of oil and gas sold, and (iii) a
refund of drilling costs on one significant well during the three months
ended March 31, 2005. As a percentage of oil and gas sales, this expense
decreased to 0.9% for the three months ended March 31, 2005 from 9.1% for
the three months ended March 31, 2004. This percentage decrease was
primarily due to the dollar decrease in depreciation, depletion, and
amortization of oil and gas properties.
General and administrative expenses increased $16,133 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses increased to 11.5%
for the three months ended March 31, 2005 from 9.0% for the three months
-39-
ended March 31, 2004. This percentage increase was primarily due to the
dollar increase in general and administrative expenses.
The Limited Partners have received cash distributions through March 31,
2005 totaling $22,176,353 or 160.31% of Limited Partners' capital
contributions.
III-C PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
---------- --------
Oil and gas sales $954,505 $848,497
Oil and gas production expenses $221,152 $189,809
Barrels produced 2,469 2,855
Mcf produced 134,206 156,564
Average price/Bbl $ 46.83 $ 32.66
Average price/Mcf $ 6.25 $ 4.82
As shown in the table above, total oil and gas sales increased $106,008
(12.5%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately $35,000 and
$192,000, respectively, were related to increases in the average prices of
oil and gas sold. These increases were partially offset by decreases of
approximately $13,000 and $108,000, respectively, related to decreases in
volumes of oil and gas sold. Volumes of oil and gas sold decreased 386
barrels and 22,358 Mcf, respectively, for the three months ended March 31,
2005 as compared to the three months ended March 31, 2004. The decrease in
volumes of oil sold was primarily due to (i) normal declines in production
and (ii) a positive prior period volume adjustment made by the operator on
one significant well during the three months ended March 31, 2004. The
decrease in volumes of gas sold was primarily due to normal declines in
production.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $31,343 (16.5%) for the three months ended
March 31, 2005 as compared to the three months ended March 31, 2004. This
increase was primarily due to (i) workover expenses incurred on several
wells during the three months ended March 31, 2005, (ii) an increase in
production taxes associated with the increase in oil and gas sales, and
(iii) a positive prior period lease operating expense adjustment on one
significant well during the three months ended March 31, 2005. As a
percentage of oil and gas sales, these expenses increased to 23.2% for the
three months ended March 31, 2005 from 22.4% for the three months ended
March 31, 2004.
-40-
Depreciation, depletion, and amortization of oil and gas properties
decreased $5,189 (9.1%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This decrease was
primarily due to (i) an increase in depletable oil and gas properties
during 2004 primarily due to the developmental drilling of one significant
well and (ii) the decreases in volumes of oil and gas sold. These
decreases were partially offset by an increase in depletable oil and gas
properties primarily due to the developmental drilling of two other
significant wells during the three months ended March 31, 2005. As a
percentage of oil and gas sales, this expense decreased to 5.5% for the
three months ended March 31, 2005 from 6.7% for the three months ended
March 31, 2004. This percentage decrease was primarily due to (i) the
increases in the average prices of oil and gas sold and (ii) the dollar
decrease in depreciation, depletion, and amortization of oil and gas
properties.
General and administrative expenses increased $15,510 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses increased to 9.4% for
the three months ended March 31, 2005 from 8.7% for the three months ended
March 31, 2004.
The Limited Partners have received cash distributions through March 31,
2005 totaling $29,726,795 or 121.56% of Limited Partners' capital
contributions.
III-D PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
--------- ---------
Oil and gas sales $535,061 $503,917
Oil and gas production expenses $124,723 $115,174
Barrels produced 2,399 2,273
Mcf produced 76,715 89,584
Average price/Bbl $ 45.62 $ 32.04
Average price/Mcf $ 5.55 $ 4.81
These results of operations do not include the discontinued operation
discussed in Note 3 to the financial statements included in PART I, ITEM 1
"Financial Statements" of theis Quarterly Report on Form 10-Q.
As shown in the table above, total oil and gas sales increased $31,144
(6.2%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately (i) $33,000
and $56,000, respectively, were related to increases in the average prices
of oil and gas sold and (ii) $4,000 was related to an increase in volumes
of oil sold. These increases were partially offset by a decrease of
approximately $62,000 related to a decrease in volumes of gas sold.
Volumes of oil sold increased 126 barrels, while volumes of gas sold
decreased 12,869 Mcf for the three
-41-
months ended March 31, 2005 as compared to the three months ended March
31, 2004. The increase in volumes of oil sold was primarily due to an
increase in production on one significant well following the successful
workover of that well during late 2004. The decrease in volumes of gas
sold was primarily due to normal declines in production.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $9,549 (8.3%) for the three months ended March
31, 2005 as compared to the three months ended March 31, 2004. As a
percentage of oil and gas sales, these expenses increased to 23.3% for the
three months ended March 31, 2005 from 22.9% for the three months ended
March 31, 2004.
Depreciation, depletion, and amortization of oil and gas properties
decreased $6,399 (27.3%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This decrease was
primarily due to (i) the decrease in volumes of gas sold and (ii) an
increase in depletable oil and gas properties during 2004 primarily due to
the developmental drilling of one significant well. These decreases were
partially offset by an increase in depletable oil and gas properties
primarily due to the developmental drilling of another significant well
during the three months ended March 31, 2005. As a percentage of oil and
gas sales, this expense decreased to 3.2% for the three months ended March
31, 2005 from 4.7% for the three months ended March 31, 2004. This
percentage decrease was primarily due to the dollar decrease in
depreciation, depletion, and amortization of oil and gas properties.
General and administrative expenses increased $16,178 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses increased to 10.9%
for the three months ended March 31, 2005 from 8.3% for the three months
ended March 31, 2004. This percentage increase was primarily due to the
dollar increase in general and administrative expenses.
The Limited Partners have received cash distributions through March 31,
2005 totaling $16,607,669 or 126.77% of Limited Partners' capital
contributions.
-42-
III-E PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
---------- ----------
Oil and gas sales $1,216,684 $1,136,092
Oil and gas production expenses $ 358,968 $ 311,191
Barrels produced 6,185 7,433
Mcf produced 172,223 181,161
Average price/Bbl $ 43.51 $ 30.68
Average price/Mcf $ 5.50 $ 5.01
These results of operations do not include the discontinued operation
discussed in Note 3 to the financial statements included in PART I, ITEM 1
"Financial Statements" of theis Quarterly Report on Form 10-Q.
As shown in the table above, total oil and gas sales increased $80,592
(7.1%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately $79,000 and
$85,000, respectively, were related to increases in the average prices of
oil and gas sold. These increases were partially offset by decreases of
approximately $38,000 and $45,000, respectively, related to decreases in
volumes of oil and gas sold. Volumes of oil and gas sold decreased 1,248
barrels and 8,938 Mcf, respectively, for the three months ended March 31,
2005 as compared to the three months ended March 31, 2004. The decrease in
volumes of oil sold was primarily due to (i) normal declines in production
and (ii) a positive prior period volume adjustment made by the operator on
one significant well during the three months ended March 31, 2004.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $47,777 (15.4%) for the three months ended
March 31, 2005 as compared to the three months ended March 31, 2004. This
increase was primarily due to (i) an increase in production taxes
associated with the increase in oil and gas sales, (ii) positive prior
period lease operating expense adjustments made by the operator on two
significant wells during the three months ended March 31, 2005, and (iii)
an increase in compression expenses incurred on two significant wells
during the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. As a percentage of oil and gas sales, these
expenses increased to 29.5% for the three months ended March 31, 2005 from
27.4% for the three months ended March 31, 2004.
Depreciation, depletion, and amortization of oil and gas properties
increased $8,998 (25.9%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This increase was
primarily due to (i) the receipt of equipment credits on one fully
depleted well during the three months ended March 31, 2004 and (ii)
downward revisions in the estimates of remaining gas reserves on two
significant wells since March 31, 2004. As
-43-
a percentage of oil and gas sales, this expense increased to 3.6% for the
three months ended March 31, 2005 from 3.1% for the three months ended
March 31, 2004. This percentage increase was primarily due to the dollar
increase in depreciation, depletion, and amortization of oil and gas
properties.
General and administrative expenses increased $14,486 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses increased to 11.3%
for the three months ended March 31, 2005 from 10.8% for the three months
ended March 31, 2004.
The Limited Partners have received cash distributions through March 31,
2005 totaling $49,637,016 or 118.67% of Limited Partners' capital
contributions.
III-F PARTNERSHIP
THREE MONTHS ENDED MARCH 31, 2005 COMPARED TO THE THREE MONTHS ENDED MARCH
31, 2004.
Three Months Ended March 31,
----------------------------
2005 2004
---------- ----------
Oil and gas sales $819,952 $645,565
Oil and gas production expenses $207,850 $178,983
Barrels produced 5,389 4,927
Mcf produced 100,250 98,635
Average price/Bbl $ 46.66 $ 32.16
Average price/Mcf $ 5.67 $ 4.94
As shown in the table above, total oil and gas sales increased $174,387
(27.0%) for the three months ended March 31, 2005 as compared to the three
months ended March 31, 2004. Of this increase, approximately $78,000 and
$73,000, respectively, were related to increases in the average prices of
oil and gas sold. Volumes of oil and gas sold increased 462 barrels and
1,615 Mcf, respectively, for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. The increase in volumes
of oil sold was primarily due to (i) an increase in production on several
wells within one unit following the successful workovers of those wells
during early 2004 and (ii) an increase in production on another
significant well following successful repairs made during mid 2004. The
increase in volumes of gas sold was primarily due to an increase in
production on one significant well following the successful recompletion
of that well during late 2004.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $28,867 (16.1%) for the three months ended
March 31, 2005 as compared to the three months ended March 31, 2004. This
increase was primarily due to (i) an increase in production taxes
-44-
associated with the increase in oil and gas sales, (ii) positive prior
period lease operating expense adjustments made by the operator on two
significant wells during the three months ended March 31, 2005, and (iii)
workover expenses incurred on several wells during the three months ended
March 31, 2005. As a percentage of oil and gas sales, these expenses
decreased to 25.3% for the three months ended March 31, 2005 from 27.7%
for the three months ended March 31, 2004.
Depreciation, depletion, and amortization of oil and gas properties
increased $10,179 (37.7%) for the three months ended March 31, 2005 as
compared to the three months ended March 31, 2004. This increase was
primarily due to (i) the receipt of equipment credits on one fully
depleted well during the three months ended March 31, 2004 and (ii)
downward revisions in the estimates of remaining gas reserves on two
significant wells since March 31, 2004. As a percentage of oil and gas
sales, this expense increased to 4.5% for the three months ended March 31,
2005 from 4.2% for the three months ended March 31, 2004.
General and administrative expenses increased $15,497 for the three months
ended March 31, 2005 as compared to the three months ended March 31, 2004.
As a percentage of oil and gas sales, these expenses decreased to 10.1%
for the three months ended March 31, 2005 from 10.5% for the three months
ended March 31, 2004.
The Limited Partners have received cash distributions through March 31,
2005 totaling $20,096,904 or 90.74% of Limited Partners' capital
contributions.
-45-
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Partnerships do not hold any market risk sensitive instruments.
ITEM 4. CONTROLS AND PROCEDURES
As of the end of this period covered by this report, the principal
executive officer and principal financial officer conducted an
evaluation of the Partnerships' disclosure controls and procedures
(as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
and Exchange Act of 1934). Based on this evaluation, such officers
concluded that the Partnerships' disclosure controls and procedures
are effective to ensure that information required to be disclosed by
the Partnerships in reports filed under the Exchange Act is
recorded, processed, summarized, and reported accurately and within
the time periods specified in the Securities and Exchange Commission
rules and forms.
-46-
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
A lawsuit styled Robert W. Scott, Individually and as Managing Member of
R.W. Scott Investments, LLC v. Samson Resources Company, Case No.
C-01-385, was filed in the District Court of Sweetwater County, Wyoming on
June 29, 2001. The lawsuit seeks class action certification and alleges
that Samson deducted from its payments to royalty and overriding royalty
owners certain charges which were improper under the Wyoming royalty
payment statutes. A number of these royalty and overriding royalty
payments burdened the interests of the Partnerships. In February 2003,
Samson made a supplemental payment to the royalty and overriding royalty
interest owners who were potential class members of amounts which were
then thought to have been improperly deducted plus statutory interest
thereon. The applicable portions of these refunds were recouped from the
Partnerships in the first quarter of 2003 as follows:
Partnership Amount
------------ ----------
III-A $ 5,380
III-B 3,548
III-C -
III-D -
III-E 122,289
III-F 102,690
The lawsuit also alleges that Samson's check stubs did not fully comply
with the Wyoming Royalty Payment Act. Samson intends to vigorously defend
this claim.
On January 14, 2005 the trial court issued a letter certifying this
lawsuit as a class action and denying Samson's motion for summary
judgment. On May 4, 2005 the trial court issued a subsequent letter
clarifying its prior decision. However, as of the date of this Quarterly
Report the trial court has not issued an Order certifying the class or
denying Samson's motion for Summary Judgment. The General Partner
anticipates receipt of this Order in the near future and intends to
immediately seek a review of these decisions by the Wyoming Supreme Court.
ITEM 6. EXHIBITS
31.1 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-A Partnership.
31.2 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-A Partnership.
-47-
31.3 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-B Partnership.
31.4 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-B Partnership.
31.5 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-C Partnership.
31.6 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-C Partnership.
31.7 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-D Partnership.
31.8 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-D Partnership.
31.9 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-E Partnership.
31.10 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-E Partnership.
31.11 Certification by Dennis R. Neill required by Rule
13a-14(a)/15d-14(a) for the III-F Partnership.
31.12 Certification by Craig D. Loseke required by Rule
13a-14(a)/15d-14(a) for the III-F Partnership.
32.1 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-A Partnership.
32.2 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-B Partnership.
32.3 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-C Partnership.
-48-
32.4 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-D Partnership.
32.5 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-E Partnership.
32.6 Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 for the III-F Partnership.
-49-
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 III-A
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
(Registrant)
BY: GEODYNE RESOURCES, INC.
General Partner
Date: May 13, 2005 By: /s/Dennis R. Neill
--------------------------------
(Signature)
Dennis R. Neill
President
Date: May 13, 2005 By: /s/Craig D. Loseke
--------------------------------
(Signature)
Craig D. Loseke
Chief Accounting Officer
-50-
INDEX TO EXHIBITS
-----------------
Exh.
No. Exhibit
- ---- -------
31.1 Certification by Dennis R. Neill required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-A.
31.2 Certification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-A.
31.3 Certification by Dennis R. Neill required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-B.
31.4 Certification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-B.
31.5 Certification by Dennis R. Neill required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-C.
31.6 ertification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-C.
31.7 Certification by Dennis R. Neill required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-D.
31.8 Certification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-D.
31.9 Certification by Dennis R. Neillrequired by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-E.
31.10 Certification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-E.
31.11 Certification by Dennis R. Neill required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-F.
31.12 Certification by Craig D. Loseke required by Rule 13a-14(a)/15d-14(a)
for the Geodyne Energy Income Limited Partnership III-F.
-51-
32.1 Certification pursuant to 18 U.S. C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-A.
32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-B.
32.3 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-C.
32.4 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-D.
32.5 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-E.
32.6 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the
Geodyne Energy Income Limited Partnership III-F.
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