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EXHIBIT 8.1
[VINSON & ELKINS L.L.P. LETTERHEAD]
June 28, 1999
Mewbourne Development Corporation
3901 South Broadway
Tyler, Texas 75701
Re: MEWBOURNE ENERGY 99-00 DRILLING PROGRAMS
Gentlemen:
You have requested our opinion with respect to certain of the
anticipated United States federal income tax consequences of the organization
and operation of (i) Mewbourne Energy Partners 99-A, L.P. and Mewbourne Energy
Partners 00-A, L.P. (individually a "Partnership" and collectively the
"Partnerships") formed or to be formed pursuant to the form of limited
partnership agreement (the "Partnership Agreement") included as Exhibit A to the
Registration Statement on Form S-1 filed with the Securities and Exchange
Commission (the "Prospectus") and (ii) the drilling programs related to each
Partnership (individually a "Program" and collectively the "Programs") to be
formed pursuant to the form of drilling program agreement (the "Drilling Program
Agreement") included as Exhibit B to the Prospectus. Capitalized terms used in
this opinion but not otherwise defined herein shall have the meaning ascribed to
them in the Partnership Agreement.
Our opinion is based and conditioned upon the initial and continuing
accuracy of (i) the facts and the factual matters stated and assumed as set
forth in the Prospectus (including the form of Partnership Agreement, Drilling
Program Agreement and other documents appended to the Prospectus) and (ii) the
representations with respect to the organization and operation of the
Partnerships and the Programs contained in the Prospectus, including without
limitation those set forth as having been made by you under the caption "Tax
Aspects."
Based upon our analysis of the form Partnership Agreement, the form
Drilling Program Agreement and the other documents appended to the Prospectus,
the facts and factual matters stated and assumed as set forth in the Prospectus,
the representations set forth in the Prospectus, and subject to the
qualifications set forth herein, we are of the opinion that, as to any
Partnership or Program formed pursuant to the form Partnership Agreement or the
form Drilling Program Agreement, respectively, and provided that no changes in
Current Law (as defined below) have occurred:
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June 28, 1999
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A. At formation, each of the Partnerships and Programs will be
classified as a partnership for federal income tax purposes.
B. The Partnerships will not be classified as associations
taxable as corporations pursuant to the "publicly traded
partnership" rules of Section 7704 of the Code.
C. Except as noted below, the allocation of income, gains, losses
and deductions between the General and Limited Partners and
the Managing Partner under each Partnership Agreement and
between a Partnership and Mewbourne Development Corporation
under each Drilling Program Agreement will be respected for
federal income purposes.
D. The passive activity loss limitations of Section 469 of the
Code will not apply to General Partners in a Partnership
(prior to any conversion of a General Partner Interest in that
Partnership to a Limited Partner Interest) to the extent that
the Partnership drills or operates wells pursuant to working
interests.
E. The Partnerships will not be treated as "publicly traded
partnerships" for purposes of the application of the passive
activity loss limitations of Section 469 of the Code.
F. The conversion of a General Partner Interest to a Limited
Partner Interest will be non-taxable provided, however, that
any reduction in a Partner's share of Partnership debt
resulting from such conversion will be treated as a cash
distribution to such Partner and will cause gain to be
recognized to the extent such cash distribution exceeds the
adjusted tax basis of such Partner's interest.
G. The allocation provisions of each Partnership Agreement and
each Program Agreement should be in compliance with Section
704(c) of the Code with respect to property contributed to a
drilling program by the Managing Partner.
The foregoing opinion, as well as the other conclusions set forth below
with respect to the tax aspects of an investment in a Partnership (and,
indirectly, a Program) are based upon the Code, regulations promulgated or
proposed thereunder, and the interpretations thereof by the Internal Revenue
Service and the courts having jurisdiction over such matters, as of the present
date ("Current Law"). All of the above are subject to change with either
prospective or retroactive effect, and our opinion and advice may be adversely
affected or rendered obsolete -- perhaps before the formation of one or more
Partnerships or Programs -- by any such change.
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Due to the inherently factual nature of certain issues, the absence of
knowledge concerning future facts with respect to such issues, or the inadequacy
of controlling authority, we are unable to render any opinion with respect to
the following specific federal income tax issues: (a) the validity of any
special allocation of an item that is dependent on a Partner's basis in an oil
or gas property; (b) the amount, if any, of the Organization and Offering
Expenses that will be deductible or amortizable; (c) the amount, if any, of the
Management Fee and the initial Administrative Costs that will be deductible or
amortizable; (d) the deductibility in a given year of any intangible drilling
and development costs incurred in a year prior to the drilling of the wells to
which such costs relate; (e) the availability or extent of percentage depletion
deductions to the Partners; (f) the deductibility of any interest expense by a
Partner; and (g) whether Interests will be considered "publicly offered
securities" for purposes of ERISA.
Although we are unable to render an opinion with respect to the issues
described in the preceding paragraph, we have reviewed the discussion of the
federal income tax consequences set forth in the Prospectus under the headings
"Risk Factors -- Tax Risks" and "Tax Aspects," and to the extent such discussion
involves matters of law, we are of the opinion that such discussion is accurate
in all material respects under the Code, the Treasury Regulations promulgated
thereunder, and existing interpretations thereof, all as of the date hereof, and
addresses fairly the principal aspects of each material federal income tax issue
relating to an investment in Interests by an "eligible citizen" (as defined in
the Prospectus) of the United States.
In light of the various opinions and assumptions described above, but
subject to the qualifications and limitations placed thereon, we are of the
opinion that, under Current Law, the material federal income tax benefits of an
investment in Interests, in the aggregate, more likely than not will be realized
in substantial part by an investor Partner who acquires his interest for profit,
provided that an investor Partner who acquires Limited Partner Interests either
is not subject to the passive activity loss limitations of Section 469 of the
Code or has sufficient passive income against which he can deduct his share of
any Partnership deductions and losses. For a discussion of the timing of the
realization of such tax benefits, see the discussion in the Prospectus under
"Tax Aspects -- Special Features of Oil and Gas Taxation -- Basis and At Risk
Limitations."
The conclusions set forth above are conditioned on our understanding
that there are no agreements, arrangements, undertakings or the like other than
those expressly reflected in the Partnership Agreement, the Drilling Program
Agreement and the other documents appended to the Prospectus.
We hereby consent to the filing of this opinion letter as an exhibit
to the Registration Statement and to the references to Vinson & Elkins L.L.P.
under the headings "Certain Federal Income Tax Consequences" and "Legal
Opinions" in the Prospectus. In giving this consent, we do
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not thereby admit that we are in the category of persons whose consent is
required under Section 7 of the 1933 Act and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder.
Very truly yours,
/s/ Vinson & Elkins L.L.P.
VINSON & ELKINS L.L.P.