10-K405 1 d80314e10-k405.txt FORM 10-K FOR FISCAL YEAR END JUNE 30, 2000 1 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED JUNE 30, 2000. OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ____________________ TO ______________________. COMMISSION FILE NO. 0-8565 MARINE PETROLEUM TRUST (Exact name of registrant as specified in its charter) TEXAS 75-6008017 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.)
C/O THE CORPORATE TRUSTEE: BANK OF AMERICA, N.A. P.O. BOX 830241, DALLAS, TEXAS 75283-0241 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (at the office of the Corporate Trustee): (800) 985-0794 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: UNITS OF BENEFICIAL INTEREST (TITLE OF CLASS) 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, and (2) has been subject to such filing requirements for the past 90 days. YES X NO --- --- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] Aggregate market value of Units of Beneficial Interest held by non-affiliates of the registrant at September 21, 2000: $36,412,534. Number of Units of Beneficial Interest outstanding as of September 21, 2000 -- 2,000,000 Units. Documents Incorporated by Reference: NONE -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- 2 CROSS-REFERENCE SHEET This Form 10-K for the year ended June 30, 2000 of Marine Petroleum Trust is not organized by conventional item numbers and headings contemplated by SEC rules and forms. This cross-reference page is intended to indicate to the reader where (or under which headings) information required under Form 10-K may be found herein.
FORM 10-K HEADINGS ITEM NUMBERS HEREIN ------------ -------- PART I...................................................... General Item 1. Business........................................ The Trust; Properties Item 2. Properties...................................... Properties Item 3. Legal Proceedings............................... Legal Matters Item 4. Submission of Matters to a Vote of Security Holders....................................... Unitholder Voting Matters PART II..................................................... Financial Item 5. Market for Registrant's Common Equity and Related Stockholder Matters................... Market and Investor Information Item 6. Selected Financial Data......................... Selected Financial Data Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.................................... Management's Discussion and Analysis of Financial Condition and Results of Operations Item 7A. Quantitative and Qualitative Disclosures About Market Risk................................... Quantitative and Qualitative Disclosures about Market Risk Item 8. Financial Statements and Supplementary Data..... Financial Statements and Supplementary Data Item 9. Disagreements on Accounting and Financial Disclosure.................................... Accounting Matters PART III.................................................... Management and Principal Unitholders Item 10. Directors and Executive Officers of the Registrant.................................... Administrators Item 11. Management Remuneration......................... Administrators; Management Compensation Item 12. Security Ownership of Certain Beneficial Owners and Management................................ Principal Unitholders Item 13. Certain Relationships and Related Transactions.................................. Administrators; Management Compensation PART IV..................................................... Miscellaneous Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K........................... Exhibits, Financial Statement Schedules and Reports on Form 8-K
3 GENERAL THE TRUST Organization. Marine Petroleum Trust ("Marine") is a royalty trust created in 1956 under the laws of the State of Texas. Marine is not permitted to engage in any business activity inasmuch as it was organized for the sole purpose of providing an efficient, orderly, and practical means for the administration and liquidation of rights to payments from certain oil and gas leases in the Gulf of Mexico, pursuant to license agreements and amendments thereto between Marine's predecessors and Gulf Oil Corporation ("Gulf"). As a result of various transactions that have occurred since 1956, the Gulf interests now are held by Chevron Corporation ("Chevron"), Elf Exploration, Inc. ("Elf"), and their assignees. The indenture pursuant to which Marine was created (the "Indenture"), provides that the corporate trustee is to distribute all cash in Marine, less an amount reserved for the payment of accrued liabilities and estimated future expenses, to unitholders of record on the 28th day of September, December, March and June of each fiscal year. If the 28th falls on a Saturday, Sunday or legal holiday, the distribution is payable on the immediately preceding business day. The Indenture also provides that the term of the royalty trust created thereby will expire on June 1, 2001 unless extended by the vote of the holders of a majority of the outstanding units of beneficial interest. Following the filing of this Annual Report, the unitholders will be asked to approve an amendment to the Indenture to extend the life of Marine beyond the expiration date. Marine's wholly-owned subsidiary, Marine Petroleum Corporation ("MPC"), holds title to interests in properties subject to Marine's interests that are situated offshore of Louisiana. Ninety-eight percent of all oil, gas, and other mineral royalties collected by this subsidiary are paid to Marine. MPC, like Marine, is prohibited from engaging in a trade or business and does only those things necessary for the administration and liquidation of its properties. Marine's only industry segment or purpose is the administration and collection of royalties. Royalties. Marine's rights are generally referred to as overriding royalty interests in the oil and gas industry, and are sometimes referred to herein as such. All production and marketing functions are conducted by the working interest owners of the leases. Revenues from the overriding royalties are paid to Marine either (i) on the basis of the selling price of oil, gas and other minerals produced, saved and sold, or (ii) at the value at the wellhead as determined by industry standards, when the selling price does not reflect the value at the wellhead. The contracts creating these interests were entered into between predecessors of Marine and Gulf, and relate to two different types of interests. One type of interest is an overriding royalty interest equal to three-fourths of 1% of the value at the well of any oil, gas, or other minerals produced and sold. Marine's overriding royalty interest applies only to existing leases and does not apply to new leases. The second interest is Marine's 32.6% equity interest in Tidelands Royalty Trust "B" ("Tidelands"), a separate Texas trust, which owns similar interests in any oil, gas, or other mineral lease acquired by Gulf and/or its transferees and assignees in a 1,370,000-acre area (divided into 60 tracts) of the Gulf of Mexico (the "Royalty Area") during a 50-year period ending April 30, 2001. Tidelands' interest in each tract consists of (i) a production payment, which reverts to an overriding royalty, on oil and gas and (ii) an overriding royalty on other minerals. The production payment is payable out of 12.5% of the value at the well of oil and gas produced and sold from leases on a subject tract until Tidelands has earned $1,500,000 on such tract. The production payment then reverts to an overriding royalty interest equal to approximately 4.17% of the value at the well of oil and gas sold from the tract. Tidelands' overriding royalty interest on minerals other than oil and gas is payable at the rate of 4.17% of the value of such minerals sold from the property. Marine, through its ownership of units of beneficial interest in Tidelands, derives a 32.6% interest in the production payments and overriding royalties of Tidelands. Presently, the leases subject to Marine's interests cover 272,913 gross acres (including Tidelands' interest in 27,312 leased acres). These leases will remain in force until the expiration of their respective terms. Leases may be voluntarily released by the working interest owner after all oil and gas reserves are produced. They may also be abandoned by the working interest owner due to failure to discover sufficient reserves to make 4 development economically worthwhile. In addition, the federal government may force termination if the working interest owner fails to fully develop a lease once it is acquired. For the year ended June 30, 2000, approximately 53% of Marine's royalty revenues were attributable to the sale of oil and approximately 47% were attributable to the sale of natural gas. The royalty revenues received by Marine are affected by seasonal fluctuations in demand and by changes in the market price for oil and gas. Royalty revenue received by Marine from Chevron and from Pennzenergy Exploration and Production Company ("Pennzenergy") accounted in the aggregate for approximately 81%, 76% and 85%, of Marine's royalty revenue for the years ended June 30, 2000, 1999, and 1998, respectively. Chevron accounted for 71%, 55% and 63% of Marine's royalty revenue for the fiscal years ended June 30, 2000, 1999 and 1998, respectively. Pennzenergy accounted for 10%, 21% and 22% of Marine's royalty revenue for the fiscal years ended June 30, 2000, 1999 and 1998, respectively. In addition, Marine's revenue from its equity interest in Tidelands accounted for approximately 6%, 10% and 15%, of Marine's revenue for the years ended June 30, 2000, 1999, and 1998, respectively. Tidelands has reported that royalty revenues from American Explorer Company, Burlington Resources, Chevron and Pennzenergy accounted for a substantial portion of Tidelands' royalty revenue for the years ended December 31, 1999, 1998, and 1997. Marine derives no revenues from foreign sources and has no export sales. Trust Functions. Marine is administered by officers and employees of its Trustee, Bank of America, N.A. MPC employs one individual (its president, treasurer and director) to perform certain management, financial and administrative services for Marine. Except for this individual, all officers and directors of MPC serve without compensation. See "Management and Principal Unitholders." Important aspects of Marine's operations are conducted by third parties. These include the production and sale of oil and gas and the calculation of royalty payments to Marine, which are conducted by oil and gas companies that lease tracts subject to Marine's interests. Similarly, Marine's distributions are processed and paid by The Bank of New York as the agent for the trustee of Marine. MPC leases office space in Dallas, Texas to provide work space and record storage for Marine, MPC, Tidelands and Tidelands' wholly-owned subsidiary corporation, Tidelands Royalty "B" Corporation. The cost of this office facility is shared by all four of these entities in proportion to each entity's gross income to the total of such income of all entities. The ability of Marine to receive revenues is entirely dependent upon its entitlement to its rights with respect to the leases held by Chevron and its assignees in the Gulf of Mexico (as more fully described in "Properties" below). Moreover, no revenues are payable to Marine until sales of production commence from any such lease. The royalty interests held by Marine are depleting with each barrel of oil and mcf of natural gas produced. No funds are reinvested by Marine; thus, these depleting assets are not being replaced. PROPERTIES General. Marine is not engaged in oil and gas operations, although its income is based upon such operations of others. Marine's income is derived from contracts that provide for payments in the nature of overriding royalties made to Marine based on oil and gas sales from certain leases in the Gulf of Mexico. Reserves. Marine is not engaged in the production of crude oil or natural gas. Its income is derived from overriding royalty payments which are carved out of working interests in oil and gas leases in the Gulf of Mexico. Marine does not have the engineering data necessary to make an estimate of proved oil and gas reserves (nor the present value of future net cash flows from such reserves), and is not entitled to receive such data from the owners of the working interests from which Marine's interest is derived. See also "Difficulty in Obtaining Certain Data" below. Since Marine does not have access to this reserve information, Marine is unable to compute the standardized measure of discounted future net cash flows therefrom. 2 5 Marine did not file any reports during the fiscal year ended June 30, 2000 with any federal authority or agency with respect to oil and gas reserves. Production. Information regarding the net quantities of oil and gas produced with respect to Marine's over-riding royalty interests (excluding its equity in Tidelands and excluding the income realized from the reduction of the amounts reserved for royalty over-payments) for each of the last three fiscal years as well as the average sales price per unit of oil and gas produced, upon which payments to Marine are based, is set forth in the following table:
YEAR ENDED JUNE 30, ----------------------------- 2000 1999(1) 1998(1) ------- ------- ------- Quantity Oil (in barrels ("bbls"))........................... 92,837 57,575 59,343 Gas (in thousand cubic feet ("mcf"))................ 807,837 869,636 582,594 Average Price Oil (per bbl)....................................... $24.51 $12.54 $15.97 Gas (per mcf)....................................... $2.48 $1.85 $2.56
------------------------- (1) Prior year numbers have been revised to conform to the current year's presentation. Information about average production cost (lifting cost) per unit of production has been omitted due to its unavailability and inapplicability to Marine. For more recent information regarding prices, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" below. Productive Wells. Based on the latest information available to Marine and including its equity interest in Tidelands, there were approximately 322 wells subject to Marine's interests actually producing at some time in calendar 1999, some of which contained multiple completions. During calendar 1999, approximately 126 wells produced oil and approximately 196 wells produced gas. Most of the oil wells also produced associated gas and most of the gas wells produced condensate, which is economically the equivalent of oil. See "Difficulty in Obtaining Certain Data" below. Drilling Activity. Information concerning the results of operations on leases in which Marine had an interest (including its equity interest in Tidelands) for each of its last three fiscal years is set forth below:
YEAR ENDED JUNE 30, -------------------------- 2000 1999(1) 1998(1) ---- ------- ------- Development Oil...................................................... 21 24 13 Gas...................................................... 36 36 23 Suspended*............................................... 6 4 13 Dry...................................................... 5 10 8 -- -- -- Totals.............................................. 68 74 57 == == ==
--------------- * "Suspended" wells are completed wells the classification of which had not been reported at the relevant date. (1) Prior year numbers have been revised to conform to the current year's presentation. Information regarding net wells or acres is not included since Marine does not own any working interests. 3 6 Lease Acreage. Marine has an overriding royalty interest (including by virtue of its equity interest in Tidelands) in 73 different oil and gas leases covering 272,913 gross acres. These leases are located in the Central and Western areas of the Gulf of Mexico off the coasts of Louisiana and Texas. This acreage is presented in the following table:
LEASES GRANTED BY (1): PRODUCING ---------------------- --------- United States............................................... 267,383 State of Texas.............................................. 640 State of Louisiana.......................................... 4,890 ------- 272,913 =======
--------------- (1) Leases are typically granted for a term of five years, during which the lease owner must establish a commercial production capability, or the lease expires. There are 9,305 acres located on leases that have commercial production, but the production is not on Marine's overriding royalty area within those leases. The overriding royalty interest owned by Marine is a fractional interest out of total oil and gas sold, and is free and clear of all operating costs. The actual percentage interest in a lease attributable to Marine's interest varies from lease to lease. The acreage weighted average percentage interest attributable to Marine's interest in all of these leases is .5864%. Present Activities. Published reports from third parties indicate that 10 wells are being drilled on tracts in which Marine has an interest. Marine also understands from published reports of third parties that operators have designated locations for 14 additional wells. Marine cannot assure the unitholders that these wells will be drilled and if drilled that they will be successful. The U.S. Department of the Interior conducted a lease sale for the Gulf of Mexico in April and August, 2000. Chevron did not bid on any tracts included in this sale that are located in the 1,370,000 acre area subject to the Tidelands contract (in which Marine has a 32.6% equity interest.) Difficulty in Obtaining Certain Data. Marine's only activities are the collection and distribution of revenues from overriding royalties on certain oil and gas leases in the Gulf of Mexico, pursuant to purchase agreements between Marine's predecessors and Gulf and its transferees. The leasehold working interests which are subject to the rights held by Marine are owned, in most cases, in whole or in part by Chevron, or other oil and gas exploration and production companies. Certain information as to reserves, availability of oil and gas, average production cost (lifting cost) per unit, undeveloped acreage, net wells and net acres, etc., with respect to the particular leases subject to Marine's interests lies solely within the knowledge of these concerns. Engineering data, if any, regarding these leaseholds would have been compiled principally by or for the working interest owners of these leaseholds and Marine believes that it will not be provided access to such information. Because of this, it appears that unreasonable efforts and expense would be involved in seeking to obtain all of the information required under Item 102 of Regulation S-K and Securities Exchange Act of 1934 Industry Guide 2. LEGAL MATTERS Neither Marine nor MPC, nor any of their respective properties (exclusive of properties owned by Chevron and subject to the Marine and Tidelands license agreements), is a party to or subject to any material pending litigation as of the date hereof. UNITHOLDER VOTING MATTERS No matter was submitted by Marine during the year ended June 30, 2000 to a vote of unitholders, whether through the solicitation of proxies or otherwise. Following the filing of this Annual Report with the SEC, the unitholders will be asked to approve an amendment to the Indenture to extend the life of the trust beyond the current expiration date of June 1, 2001. 4 7 Marine is to continue until June 1, 2001, or until such later date as holders of the units owning a majority of the outstanding units may designate, but in any event, not more than 20 years from such designation. Alternatively, instead of so extending the term of Marine, the holders of the units owning a majority of the outstanding units may direct the Trustee to create one or more corporations to receive and hold the trust estate, or any portion thereof, unless the Trustee shall have received written objection from any unitholder within 20 days from the date of mailing to the unitholders of the first notice of the proposed consent. However, the unitholders owning eighty percent (80%) of the outstanding units may terminate the trust on any date, whether earlier or later than any such date determined as above, as they may specify. If the Indenture is not extended then the trust underlying Marine will be terminated. Upon termination of the trust (other than by the transfer of all the trust estate to a corporation pursuant to the provisions of the Indenture, as described above), the Trustee, after paying all of the obligations of the trust, shall transfer to an agent appointed by the holders of the units owning a majority of the outstanding units, by recordable assignments but without warranty, the interests in the trust estate. Prior to termination of the trust, no unitholder shall have any legal title in or to any of the properties comprising the trust estate nor the right to secure any partition thereof. Unitholders owning ten percent (10%) or more of the outstanding units may at any time direct the Trustee to conduct an investigation to determine whether the Trustee is receiving all revenues properly accruing to Marine's trust estate. The Trustee may be removed by unitholders owning a majority of the outstanding units. The unitholders owning eighty percent (80%) of the outstanding units may amend and modify the Indenture or any contract, agreement or undertaking which constitutes a part of the trust estate, but no such amendment may change the nature of the trust from that of a purely ministerial trust, nor can there be any change in the rights or responsibilities of the Trustee without its consent. However, no such change shall be made with respect to any amendment to the Indenture if the Trustee shall receive written objection from any unitholder within 20 days from the date of mailing to the unitholders of the first notice of the proposed consent. Each unitholder has the right to examine, inspect and audit all records relating to the trust estate. FINANCIAL MARKET AND INVESTOR INFORMATION The units of beneficial interest in Marine trade on the Nasdaq SmallCap Market under the symbol "MARPS". Distributions of cash are made to unitholders quarterly. The following table presents the range of high and low trade prices by quarter for the past two years as reported by the OTC Market Report. The per unit amount of cash distributed to unitholders for each of these quarters is also presented in the table.
TRADE PRICE ------------------ DISTRIBUTIONS QUARTER ENDING HIGH LOW PER UNIT -------------- ------- ------- ------------- September 30, 1999.................................. 15.750 13.875 .436 December 31, 1999................................... 15.750 13.500 .517 March 31, 2000...................................... 16.000 13.750 .555 June 30, 2000....................................... 15.938 14.500 .643 September 30, 1998.................................. 17.500 12.125 .326 December 31, 1998................................... 15.250 12.500 .406 March 31, 1999...................................... 15.000 12.375 .305 June 30, 1999....................................... 19.000 13.500 .352
Marine is authorized to issue and has issued 2,000,000 units of beneficial interest. On September 12, 2000, these outstanding units were held of record by 684 unitholders. 5 8 Marine must distribute to its unitholders all cash accumulated each quarter, less an amount reserved for accrued liabilities and estimated future expenses. Such distributions have been made since the third quarter of 1977 and will continue so long as the income from oil and gas royalties exceeds administrative costs. Distributions fluctuate from quarter to quarter due to changes in oil and gas prices and production quantities. Distributions, however, are determined by the cash available to Marine on the determination date. SELECTED FINANCIAL DATA
(IN THOUSANDS EXCEPT PER UNIT AMOUNTS) ---------------------------------------------- 2000 1999 1998 1997 1996 ------ ------ ------ ------ ------ STATEMENT OF INCOME AND UNDISTRIBUTED INCOME SELECTED DATA Income: Oil and gas royalties.................... 4,526 $2,841 $2,577 $3,645 $2,842 Equity in Tidelands...................... 318 328 461 319 385 Interest................................. 92 98 100 101 92 ------ ------ ------ ------ ------ 4,936 $3,267 $3,138 $4,065 $3,319 ------ ------ ------ ------ ------ Expenses: General and administrative............... 180 $ 176 $ 146 $ 143 $ 121 Federal income taxes of subsidiary....... 12 6 12 8 12 ------ ------ ------ ------ ------ 192 $ 182 $ 158 $ 151 $ 133 ------ ------ ------ ------ ------ Net income............................... 4,744 $3,085 $2,980 $3,914 $3,186 ====== ====== ====== ====== ====== Distributions............................ 4,300 $2,777 $3,216 $3,939 $2,548 ====== ====== ====== ====== ====== Per Unit (2,000,000 outstanding) Net income............................... $ 2.37 $ 1.54 $ 1.49 $ 1.96 $ 1.59 ====== ====== ====== ====== ====== Distributions............................ $ 2.15 $ 1.39 $ 1.61 $ 1.97 $ 1.27 ====== ====== ====== ====== ====== BALANCE SHEET SELECTED DATA Total assets................................ $2,570 $2,371 $2,745 $2,945 $2,979 ====== ====== ====== ====== ====== Trust equity................................ $2,560 $2,117 $1,809 $2,045 $2,070 ====== ====== ====== ====== ======
6 9 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Capital Resources and Liquidity. Because of the nature of Marine as a trust entity, there is no requirement for capital; its only obligation is to distribute to unitholders the net income actually collected. As an administrator of oil and gas royalty properties, Marine collects income monthly, pays expenses of administration, and disburses all net income collected to its unitholders each quarter. Marine's Indenture (and the charter and by-laws of MPC) expressly prohibits the operation of any kind of trade or business. Marine's oil and gas properties are depleting assets and are not being replaced due to the prohibition against these investments. These restrictions, along with other factors, allow Marine to be treated as a grantor trust; thus all income and deductions, for tax purposes, should flow through to each individual unitholder. Marine is not a taxable entity. Results of Operations. Marine's revenues are derived from the oil and gas production activities of unrelated parties. Marine's revenues and distributions fluctuate from period to period based upon factors beyond Marine's control, including without limitation the number of leases bid on and obtained by parties subject to Marine's interests, the number of productive wells drilled on leases subject to Marine's interests, the level of production over time from such wells and the prices at which the oil and gas from such wells is sold. Marine believes that it will continue to have revenues sufficient to permit distributions to be made to unitholders for the foreseeable future, although no assurance can be made regarding the amounts thereof. The foregoing sentence is a forward-looking statement. Factors that might cause actual results to differ from expected results include reductions in prices or demand for oil and gas, which might then lead to decreased production; reductions in production due to depletion of existing wells or disruptions in service, including as the result of storm damage, blowouts or other production accidents, and geological changes such as cratering of productive formations; expiration or release of leases subject to Marine's interests; and the discontinuation by parties subject to Marine's interests of their efforts to obtain leases in the Royalty Area. Marine's income consists primarily of oil and gas royalties and is based on the value at the well of its percentage interest in oil and gas sold without reduction for any of the expense of production. Value at the well for oil is the purchasers' posted price at its receiving point onshore, less the cost of transportation from the offshore lease to the onshore receiving point. In general, value at the well is determined on the basis of the selling price of oil, gas and other minerals produced, saved and sold, or at wellhead prices determined by industry standards, where the selling price does not reflect value at the well. Summary Review. Marine's net income for the year ended June 30, 2000 amounted to $4,743,594 or $2.37 per unit as compared to $3,084,449 or $1.54 per unit in fiscal 1999 and $2,980,458 or $1.49 per unit in fiscal 1998. These results include $244,250, $514,000 and $137,474 realized in fiscal 2000, 1999 and 1998, respectively, from reduction of an accounts payable provided by MPC to cover possible refunds that may have been required upon redetermination of gas prices for royalty payments in prior periods. During fiscal 2000 MPC determined that the accounts payable was no longer required and accordingly reduced the accounts payable to zero and increased income before federal income taxes by $244,250. These results also include income from Marine's equity interest in Tidelands which amounted to $318,072 for fiscal 2000, and for fiscal 1999 and 1998 it was $328,085 and $461,095, respectively. Income from Tidelands contributed approximately 6% of Marine's royalty income for fiscal 2000 as compared to 10% and 15% of Marine's royalty income for fiscal 1999 and fiscal 1998, respectively. Marine's administrative expenses and interest income were approximately the same during the past three years. The changes in net income are primarily the result of changes in oil and gas royalties. Higher oil prices and increased production during fiscal 2000 resulted in an increase in oil royalties over the amount realized in fiscal 1999. Oil royalties declined in fiscal 1999 from the amounts realized in fiscal 1998 due to a decrease in the price received for oil and a decline in production. Higher gas prices and increased production during fiscal 2000 resulted in an increase in gas royalties over those realized in fiscal 1999. While gas prices declined in fiscal 1999, the decrease was offset by an increase in production, which produced an increase in gas royalties over those realized in fiscal 1998. 7 10 Marine believes that the drilling and work-over program of the operating companies, which has resulted in an average of 66 new completions over the past three years, is primarily responsible for maintaining the number of producing wells at approximately 300 for the past three fiscal years. The following table and related discussion and analysis shows the royalty income, the net quantities sold, and the average price received for oil and gas during the past three years excluding Marine's equity interest in Tidelands and the $244,250, $514,000 and $137,474 realized in fiscal 2000, fiscal 1999 and fiscal 1998, respectively, from the reduction of the previously established accounts payable for possible royalty over-payments that management no longer deemed required.
FOR YEARS ENDED JUNE 30 ------------------------------------ 2000 1999(1) 1998(1) ---------- ---------- ---------- Income from Oil royalties.................................. $2,275,447 $ 721,782 $ 947,656 Gas royalties.................................. 2,006,664 1,604,772 1,491,996 ---------- ---------- ---------- Totals................................. $4,282,111 $2,326,554 $2,439,652 ---------- ---------- ---------- Net quantities sold Oil (bbls)..................................... 92,837 57,575 59,343 Gas (mcf)...................................... 807,837 869,636 582,594 Average price Oil............................................ $ 24.51 $ 12.54 $ 15.97 Gas............................................ $ 2.48 $ 1.85 $ 2.56
--------------- (1) 1999 and 1998 numbers have been revised to conform to the current year's presentation. Oil and Gas Royalties -- 2000 and 1999: During fiscal 2000, Marine received approximately 53% of its royalty income from the sale of oil and 47% from the sale of natural gas. Income from such oil and gas royalties in fiscal 2000 increased approximately 84% from fiscal 1999. Oil royalties during fiscal 2000 in the amount of $2,275,447 were 215% more than oil royalties received in fiscal 1999 in the amount of $721,782, due to an increase in the quantity of oil sold and in the average price received. Natural gas royalties during fiscal 2000 in the amount of $2,006,664 were 25% higher than natural gas royalties received in fiscal 1999 in the amount of $1,604,772. The increase was due to an increase in the price received that was partially offset by a decrease in the quantity of natural gas sold. Oil and Gas Royalties -- 1999 and 1998: During fiscal 1999, Marine received 31% of its royalty income from the sale of oil and 69% from the sale of natural gas. Income from such oil and gas royalties in fiscal 1999 decreased 5% from fiscal 1998. Oil royalties during fiscal 1999 in the amount of $721,782 were 24% less than oil royalties received in fiscal 1998 in the amount of $947,656. Natural gas royalties during fiscal 1999 in the amount of $1,604,772 were 8% more than natural gas royalties received in fiscal 1998 in the amount of $1,491,996. 8 11 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK At June 30, 2000, Marine did not have any market risk exposure with regard to any activities in derivative financial instruments, other financial instruments and derivative commodity instruments. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The financial statements listed in the following Index, together with the related notes and the report of KPMG LLP, independent certified public accountants, are presented on pages 12 through 18 hereof.
PAGE ---- Independent Auditors' Report................................ 12 Financial Statements: Consolidated Balance Sheets as of June 30, 2000 and 1999................................................... 13 Consolidated Statements of Income and Undistributed Income for the Three Years Ended June 30, 2000................ 14 Consolidated Statements of Cash Flows for the Three Years Ended June 30, 2000.................... 15 Notes to Consolidated Financial Statements................ 16
See also "Exhibits, Financial Statement Schedules and Reports on Form 8-K" of this Form 10-K for further information concerning the financial statements of Marine and its subsidiaries. All schedules have been omitted for the reason that they are either not required, not applicable or the required information is included in the financial statements and notes thereto. ACCOUNTING MATTERS During fiscal 2000 and 1999, there have been no disagreements between Marine and its independent auditors on accounting or financial disclosure matters which would warrant disclosure under Item 304 of Regulation S-K. 9 12 MANAGEMENT AND PRINCIPAL UNITHOLDERS ADMINISTRATORS Marine is a trust created under the laws of the State of Texas. Marine's Indenture does not provide for directors or officers or the election of directors or officers. Under the Indenture, Bank of America, N.A., serves as Trustee. R. Ray Bell may be considered a significant employee of Marine. Mr. Bell has been involved in the administration of Marine since its inception. He was the chief financial officer of Marine's predecessor and is 73 years old. Since July 1, 1977, he has served as an officer and director of MPC, and will continue to serve in such capacities until the next meeting of directors and shareholders, respectively, of MPC or until his successors are elected and qualified. MANAGEMENT COMPENSATION During the fiscal year ended June 30, 2000, Marine paid or accrued fees of $26,188 to Bank of America, N.A., as Trustee. These fees are paid in accordance with the terms of the Indenture, as amended, governing Marine. PRINCIPAL UNITHOLDERS The following table sets forth the persons known to Marine who own beneficially more than five percent of the outstanding units of beneficial interest as of June 30, 2000:
AMOUNT AND NATURE OF PERCENT TITLE OF CLASS NAME AND ADDRESS BENEFICIAL OWNERSHIP OF CLASS -------------- ---------------- -------------------- -------- Units of Beneficial L. C. Paslay 286,469 units, 14.32% Interest 1020 S. Ocean Blvd. owned Manalapan, FL 33462 of record and beneficially*
--------------- * Does not include 27,225 units held in trust in the name of L. C. Paslay, as Co-Trustee with Bank of America, N.A., for the benefit of Patricia L. Martin, daughter of Mr. Paslay. There are no executive officers or directors of Marine. Bank of America, N.A. does not beneficially own any units of beneficial interest. 10 13 MISCELLANEOUS EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) Financial Statements -- see "Financial Statements and Supplementary Data" above. The consolidated financial statements, together with the related notes and the report of KPMG LLP, independent certified public accountants, as contained in the Form 10-K of Tidelands Royalty Trust "B" for its fiscal year ended December 31, 1999 and filed with the Securities and Exchange Commission, are hereby incorporated herein by reference for all purposes. (b) Reports on Form 8-K -- No reports on Form 8-K have been filed during the last quarter of the fiscal year ended June 30, 2000. (c) Exhibits: 3.1 -- Indenture, as amended, of Marine, filed as Exhibit 3 to the Annual Report on Form 10-K of Marine Petroleum Trust for the fiscal year ended June 30, 1994, filed with the Securities and Exchange Commission and incorporated by reference herein. 4.1 -- Form of Certificate evidencing Unit(s) of Beneficial Interest, filed as Exhibit 4 to the Annual Report on Form 10-K of Marine Petroleum Trust for the fiscal year ended June 30, 1994, filed with the Securities and Exchange Commission and incorporated by reference herein. 21.1 -- Subsidiaries of Marine. 27.1 -- Financial Data Schedule.
11 14 INDEPENDENT AUDITORS' REPORT The Trustee Marine Petroleum Trust: We have audited the accompanying consolidated balance sheets of Marine Petroleum Trust and subsidiary as of June 30, 2000 and 1999 and the related consolidated statements of income and undistributed income and cash flows for each of the years in the three-year period ended June 30, 2000. These financial statements are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Marine Petroleum Trust and subsidiary as of June 30, 2000 and 1999 and the results of their operations and their cash flows for each of the years in the three-year period ended June 30, 2000, in conformity with accounting principles generally accepted in the United States of America. /s/ KPMG LLP Dallas, Texas September 15, 2000 12 15 MARINE PETROLEUM TRUST AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS JUNE 30, 2000 AND 1999 ASSETS
2000 1999 ---------- ---------- Current assets: Cash and cash equivalents................................. $1,681,598 $1,659,864 Oil and gas royalties receivable.......................... 486,708 307,657 Receivables from affiliate (note 2)....................... 95,002 80,939 ---------- ---------- Total current assets.............................. 2,263,308 2,048,460 ---------- ---------- Investment in affiliate (note 2)............................ 306,401 322,070 Office equipment, net....................................... 555 555 Producing oil and gas properties............................ 7 7 ---------- ---------- 2,570,271 $2,371,092 ========== ========== LIABILITIES AND TRUST EQUITY Current liabilities: Accounts payable (note 3)................................. $ 88 $ 244,250 Income taxes payable...................................... 10,182 10,156 ---------- ---------- Total liabilities................................. 10,270 254,406 ---------- ---------- Trust equity: Corpus -- authorized 2,000,000 units of beneficial interest, issued 2,000,000 units at nominal value...... 8 8 Undistributed income...................................... 2,559,993 2,116,678 ---------- ---------- Total trust equity................................ 2,560,001 2,116,686 ---------- ---------- $2,570,271 $2,371,092 ========== ==========
See accompanying notes to consolidated financial statements. 13 16 MARINE PETROLEUM TRUST AND SUBSIDIARY CONSOLIDATED STATEMENTS OF INCOME AND UNDISTRIBUTED INCOME THREE YEARS ENDED JUNE 30, 2000
2000 1999 1998 ---------- ---------- ---------- Income: Oil and gas royalties................................ $4,526,361 $2,840,554 $2,577,126 Equity in earnings of affiliate (note 2)............. 318,072 328,085 461,095 Interest income...................................... 92,399 97,929 99,915 ---------- ---------- ---------- 4,936,832 3,266,568 3,138,136 Expenses: General and administrative........................... 180,832 176,169 146,366 ---------- ---------- ---------- Income before federal income taxes........... 4,756,000 3,090,399 2,991,770 Federal income taxes of subsidiary..................... 12,406 5,950 11,312 ---------- ---------- ---------- Net income................................... 4,743,594 3,084,449 2,980,458 Undistributed income at beginning of year.............. 2,116,678 1,809,260 2,044,795 ---------- ---------- ---------- 6,860,272 4,893,709 5,025,253 Distributions to unitholders........................... 4,300,279 2,777,031 3,215,993 ---------- ---------- ---------- Undistributed income at end of year.................... $2,559,993 $2,116,678 $1,809,260 ========== ========== ========== Net income per unit.................................... $ 2.37 $ 1.54 $ 1.49 ========== ========== ========== Distributions per unit................................. $ 2.15 $ 1.39 $ 1.61 ========== ========== ==========
See accompanying notes to consolidated financial statements. 14 17 MARINE PETROLEUM TRUST AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS THREE YEARS ENDED JUNE 30, 2000
2000 1999 1998 ----------- ----------- ----------- Cash flows from operating activities: Net income........................................ $ 4,743,594 $ 3,084,449 $ 2,980,458 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation................................... -- -- 1,936 Equity in undistributed earnings of affiliate.................................... 15,669 (15,400) (21,192) Change in assets and liabilities: Oil and gas royalties receivable............. (179,051) 91,350 436,223 Receivables from affiliate................... (14,063) 35,438 (51,797) Accounts payable............................. (244,162) (682,413) 30,939 Income taxes payable......................... 26 1,135 4,263 ----------- ----------- ----------- Net cash provided by operating activities........................... 4,322,013 2,514,559 3,380,830 Cash flows used in investing activities -- purchase of office equipment............................... -- -- (2,219) Cash flows used in financing activities -- distributions to unitholders........ (4,300,279) (2,777,031) (3,215,993) ----------- ----------- ----------- Net increase (decrease) in cash and cash equivalents....................................... 21,734 (262,472) 162,618 Cash and cash equivalents at beginning of year...... 1,659,864 1,922,336 1,759,718 ----------- ----------- ----------- Cash and cash equivalents at end of year............ $ 1,681,598 $ 1,659,864 $ 1,922,336 =========== =========== ===========
See accompanying notes to consolidated financial statements. 15 18 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS THREE YEARS ENDED JUNE 30, 2000 (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) General The Marine Petroleum Trust ("Marine") was established on June 1, 1956 with the transfer of property to Marine consisting of certain contract rights, units of beneficial interest and common stock in exchange for units of beneficial interest in Marine. The contract rights entitled Marine to receive a .0075 overriding royalty interest in oil, gas and other mineral leasehold interests acquired by Gulf Oil Corporation, now Chevron U.S.A., Inc. ("Chevron"), a subsidiary of Chevron Corporation, in certain areas of the Gulf of Mexico prior to January 1, 1980. Marine must distribute all income, after paying its liabilities and obligations, to the unitholders during the months of March, June, September and December each year. It cannot invest any of its money for any purpose and cannot engage in a trade or business. A Louisiana trust can only exist for a short period of time; therefore, the unitholders assigned their contract rights off-shore of Louisiana to Marine Petroleum Corporation, a wholly-owned subsidiary of Marine, ("MPC") reserving a 98% net profits interest to themselves. The net profits interest contract was transferred to Marine along with the other properties. Marine is authorized to pay expenses of MPC should it be necessary. Marine is to continue until June 1, 2001, or until such later date as holders of the units owning a majority of the outstanding units may designate, but in any event, not more than 20 years from such designation. Alternatively, instead of so extending the term of the trust, the holders of the units owning a majority of the outstanding units may direct the Trustee to create one or more corporations to receive and hold the trust estate, or any portion thereof, unless the Trustee shall have received written objection from any unitholder within 20 days from the date of mailing to the unitholders of the first notice of the proposed consent. However, the unitholders owning eighty percent (80%) of the outstanding units may terminate the trust on any date. Following the filing of this Annual Report with the SEC, the unitholders will be asked to approve an amendment to the Indenture to extend the life of the trust beyond the current expiration date of June 1, 2001. (b) Principles of Consolidation The consolidated financial statements include Marine and its wholly-owned subsidiary, MPC. All material intercompany accounts and transactions have been eliminated in consolidation. (c) Producing Oil and Gas Properties At the time Marine was established, no determinable market value was available for the assets transferred to Marine; consequently, nominal values were assigned. Accordingly, no allowance for depletion has been computed. All income from oil and gas royalties relate to proved developed oil and gas reserves. (d) Undistributed Income Marine's indenture agreement provides that the corporate trustee is to distribute all cash in the trust, less an amount reserved for the payment of accrued liabilities and estimated future expenses, to unitholders of record on the 28th day of March, June, September and December of each year. If the 28th falls on a Saturday, Sunday or legal holiday, the distribution is payable on the immediately preceding business day. Undistributed income includes $855,397 and $785,532 applicable to MPC at June 30, 2000 and 1999, respectively. 16 19 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) THREE YEARS ENDED JUNE 30, 2000 (e) Federal Income Taxes No provision has been made for Federal income taxes on Marine's income since such taxes are the liability of the unitholders. Federal income taxes have been provided on the income of MPC, excluding the 98% net profits interest to be distributed to Marine and deducting statutory depletion. (f) Credit Risk Concentration and Cash Equivalents Financial instruments which potentially subject Marine and MPC to concentrations of credit risk are primarily investments in cash equivalents and receivables. Marine and MPC place their cash investments with financial institutions or companies that management considers credit worthy and limit the amount of credit exposure from any one financial institution or company. Marine has not experienced significant problems collecting its receivables in the past. Marine and MPC had cash equivalents of $1,611,902 and $1,640,570 at June 30, 2000 and 1999, respectively, which consisted of money market accounts and money market mutual funds. For purposes of the statements of cash flows, Marine considers all investments with initial maturities of three months or less to be cash equivalents. (g) Statements of Cash Flows MPC made Federal income tax payments of $12,380, $4,815 and $7,049 during the years ended June 30, 2000, 1999 and 1998, respectively. (h) Fair Value of Financial Instruments Marine and MPC define the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. The carrying value of cash equivalents, oil and gas royalties receivable, receivables from affiliates, accounts payable, and taxes payable approximate fair value because of the short maturities of those instruments. (i) Use of Estimates Management of Marine and MPC has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with generally accepted accounting principles. Actual results could differ from those estimates. (j) Income Per Unit Income per unit is calculated by dividing net income by the weighted average number of units of beneficial interest outstanding during the period. (k) Significant Royalty Sources Royalty revenue received by Marine from producers is summarized as follows: 2000 1999 1998 ---- ---- ---- Chevron..................................................... 71% 55% 63% Pennzenergy................................................. 10% 21% 22% Others...................................................... 19% 24% 15% --- --- --- 100% 100% 100% === === ===
17 20 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) THREE YEARS ENDED JUNE 30, 2000 (2) INVESTMENT IN AND RECEIVABLES FROM AFFILIATE -- TIDELANDS ROYALTY TRUST "B" At June 30, 2000 and 1999, Marine owned 32.63% of the outstanding units of interest in Tidelands Royalty Trust "B" ("Tidelands"). The 452,366 units owned by Marine had a quoted market value of $1,837,737 and $2,233,557 at June 30, 2000 and 1999, respectively. Marine and Tidelands share certain common costs which are allocated based on their respective net revenues. The investment in affiliate is accounted for by the equity method. The following summarizes changes in this account for 2000 and 1999:
2000 1999 --------- --------- Balance at beginning of year................................ $ 322,070 $ 306,670 Equity in earnings of affiliate............................. 318,072 328,085 Distribution of earnings.................................... (333,741) (312,685) --------- --------- Balance at end of year...................................... $ 306,401 $ 322,070 ========= =========
At June 30, 2000 and 1999, receivables from affiliate includes $82,765 and $68,212, respectively, of income distributable to Marine as a Tidelands unitholder. The following summary financial statements have been derived from the unaudited consolidated financial statements of Tidelands. BALANCE SHEETS ASSETS
JUNE 30 ------------------------ 2000 1999 ---------- ---------- Cash and cash equivalents................................... $1,448,800 $1,595,149 Oil and gas royalties receivable............................ 104,632 129,418 Other....................................................... 579 3,476 ---------- ---------- $1,554,011 $1,728,043 ========== ==========
LIABILITIES AND TRUST EQUITY Liabilities (including $262,797 and $218,194 payable to unitholders in 2000 and 1999, respectively)........................... $ 614,975 $ 741,001 Corpus...................................................... 2 2 Undistributed income........................................ 939,034 987,040 ---------- ---------- $1,554,011 $1,728,043 ========== ==========
18 21 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) THREE YEARS ENDED JUNE 30, 2000 STATEMENTS OF INCOME
YEAR ENDED JUNE 30 -------------------------------------- 2000 1999 1998 ---------- ---------- ---------- Income.......................................... $1,081,252 $1,149,611 $1,537,607 Expenses........................................ 88,149 93,817 108,331 ---------- ---------- ---------- Income before Federal income taxes......... 993,103 1,055,794 1,429,276 Federal income taxes of Tidelands' subsidiary... 18,285 11,765 16,150 ---------- ---------- ---------- Net income................................. $ 974,818 $1,044,029 $1,413,126 ========== ========== ==========
Tidelands is a registrant with the Securities and Exchange Commission and has filed a Form 10-K as of December 31, 1999. (3) OVERPAID ROYALTIES During fiscal years 2000, 1999 and 1998, MPC determined that $244,250, $514,000 and $137,474, respectively, of the previously-established accounts payable for possible royalty overpayments was no longer deemed required. Accordingly, during these fiscal years, MPC reduced accounts payable and increased income before federal income taxes by such amounts. (4) SUMMARY OF QUARTERLY FINANCIAL DATA (UNAUDITED) The following quarterly financial information for fiscal year 2000 and 1999 is unaudited; however, in the opinion of management, all adjustments necessary to a fair statement of the results of operations for the interim periods have been included.
NET OIL AND GAS INCOME ROYALTIES EXPENSES NET INCOME PER UNIT ----------- -------- ---------- -------- Quarter ended: September 30, 1999....................... $1,004,437 33,834 1,077,262 .54 December 31, 1999........................ 1,044,398 55,942 1,096,213 .55 March 31, 2000........................... 1,502,621 55,176 1,540,241 .77 June 30, 2000............................ 974,905 35,880 1,029,878 .51 ---------- ------- --------- ---- $4,526,361 180,832 4,743,594 2.37 ========== ======= ========= ==== Quarter ended: September 30, 1998....................... $ 669,234 58,382 685,780 .34 December 31, 1998........................ 843,063 43,584 924,822 .46 March 31, 1999........................... 648,852 39,260 747,857 .37 June 30, 1999............................ 679,405 34,943 725,990 .37 ---------- ------- --------- ---- $2,840,554 176,169 3,084,449 1.54 ========== ======= ========= ====
19 22 MARINE PETROLEUM TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) THREE YEARS ENDED JUNE 30, 2000 (5) SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS RESERVES (UNAUDITED) Oil and gas reserve information relating to Marine's and Tidelands' royalty interests is not presented because such information is not available to Marine or Tidelands. Marine's share of oil and gas produced for its royalty interests and the Marine's equity in oil and gas produced for Tidelands' royalty interests were as follows:
2000 1999 1998 ------- ------- ------- Marine: Oil (barrels).......................................... 92,837 57,575 59,343 ======= ======= ======= Gas (mcf).............................................. 807,837 869,636 582,594 ======= ======= ======= Tidelands: Oil (barrels).......................................... 3,527 4,163 3,245 ======= ======= ======= Gas (mcf).............................................. 76,081 129,413 171,549 ======= ======= =======
20 23 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. MARINE PETROLEUM TRUST (Registrant) By: BANK OF AMERICA, N.A. in its capacity as trustee of Marine Petroleum Trust and not in its individual capacity or otherwise By: /s/ CINDY STOVER MILLER ---------------------------------- Cindy Stover Miller Vice President Date: September 27, 2000 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. BANK OF AMERICA, N.A. in its capacity as trustee of Marine Petroleum Trust and not in its individual capacity or otherwise By: /s/ CINDY STOVER MILLER ---------------------------------- Cindy Stover Miller Vice President Date: September 27, 2000 /s/ R. RAY BELL ------------------------------------ R. Ray Bell (Principal Accounting Officer) Date: September 27, 2000 21 24 INDEX TO EXHIBITS
EXHIBITS DESCRIPTION -------- ----------- 3.1 -- Indenture, as amended, of Marine, filed as Exhibit 3 to the Annual Report on Form 10-K of Marine Petroleum Trust for the fiscal year ended June 30, 1994, filed with the Securities and Exchange Commission and incorporated by reference herein. 4.1 -- Form of Certificate evidencing Unit(s) of Beneficial Interest, filed as Exhibit 4 to the Annual Report on Form 10-K of Marine Petroleum Trust for the fiscal year ended June 30, 1994, filed with the Securities and Exchange Commission and incorporated by reference herein. 21.1 -- Subsidiaries of Marine. 27.1 -- Financial Data Schedule.