-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H8TaLpQuaVPuSsP8X0J9mO5Gr/5YhUVB+EoOtkPhJG1svjHAf4uRErpgDbzpTVDd 5yCdkonl9XsVFl8jBD6kUg== 0000828191-01-500005.txt : 20010809 0000828191-01-500005.hdr.sgml : 20010809 ACCESSION NUMBER: 0000828191-01-500005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PARKER & PARSLEY 88 B L P CENTRAL INDEX KEY: 0000828191 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 752240121 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-17671 FILM NUMBER: 1700402 BUSINESS ADDRESS: STREET 1: 303 W WALL STE 101 CITY: MIDLAND STATE: TX ZIP: 79701 BUSINESS PHONE: 9156834768 MAIL ADDRESS: STREET 1: 303 W WALL SUITE 101 CITY: MIDLAND STATE: TX ZIP: 79701 10-Q 1 j88b.txt P&P 88-B 6/30/2001 10-Q UNITED STATES 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 quarterly period ended June 30, 2001 Commission File No. 33-19659-02 PARKER & PARSLEY 88-B, L.P. (Exact name of Registrant as specified in its charter) Delaware 75-2240121 ------------------------------------------ --------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 5205 N. O'Connor Blvd., Suite 1400, Irving, Texas 75039 -------------------------------------------------- ------------ (Address of principal executive offices) (Zip code) Registrant's Telephone Number, including area code : (972) 444-9001 Not applicable (Former name, former address and former fiscal year, if changed since last report) 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 / / PARKER & PARSLEY 88-B, L.P. TABLE OF CONTENTS Page Part I. Financial Information Item 1. Financial Statements Balance Sheets as of June 30, 2001 and December 31, 2000....................................... 3 Statements of Operations for the three and six months ended June 30, 2001 and 2000...................... 4 Statement of Partners' Capital for the six months ended June 30, 2001...................................... 5 Statements of Cash Flows for the six months ended June 30, 2001 and 2000................................... 6 Notes to Financial Statements.............................. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations...................... 7 Part II. Other Information Item 6. Exhibits and Reports on Form 8-K........................... 11 Signatures................................................. 12 2 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) Part I. Financial Information Item 1. Financial Statements BALANCE SHEETS June 30, December 31, 2001 2000 ----------- ----------- (Unaudited) ASSETS Current assets: Cash $ 315,293 $ 144,763 Accounts receivable - oil and gas sales 138,533 198,467 ---------- ---------- Total current assets 453,826 343,230 ---------- ---------- Oil and gas properties - at cost, based on the successful efforts accounting method 6,772,191 6,954,545 Accumulated depletion (5,822,040) (5,969,972) ---------- ---------- Net oil and gas properties 950,151 984,573 ---------- ---------- $ 1,403,977 $ 1,327,803 ========== ========== LIABILITIES AND PARTNERS' CAPITAL Current liabilities: Accounts payable - affiliate $ 22,604 $ 16,350 Partners' capital: Managing general partner 13,783 13,083 Limited partners (8,954 interests) 1,367,590 1,298,370 ---------- ---------- 1,381,373 1,311,453 ---------- ---------- $ 1,403,977 $ 1,327,803 ========== ==========
The financial information included as of June 30, 2001 has been prepared by the managing general partner without audit by independent public accountants. The accompanying notes are an integral part of these financial statements. 3 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) STATEMENTS OF OPERATIONS (Unaudited) Three months ended Six months ended June 30, June 30, ---------------------- ---------------------- 2001 2000 2001 2000 --------- --------- --------- --------- Revenues: Oil and gas $ 287,569 $ 302,734 $ 613,966 $ 591,346 Interest 2,193 3,085 4,914 5,177 Gain on disposition of assets 7,855 8,845 7,855 8,845 -------- -------- -------- -------- 297,617 314,664 626,735 605,368 -------- -------- -------- -------- Costs and expenses: Oil and gas production 128,587 114,842 233,029 205,053 General and administrative 7,189 8,802 15,349 17,740 Depletion 21,178 15,809 36,755 35,517 Abandoned property 10,241 - 10,241 - -------- -------- -------- -------- 167,195 139,453 295,374 258,310 -------- -------- -------- -------- Net income $ 130,422 $ 175,211 $ 331,361 $ 347,058 ======== ======== ======== ======== Allocation of net income: Managing general partner $ 1,305 $ 1,753 $ 3,314 $ 3,471 ======== ======== ======== ======== Limited partners $ 129,117 $ 173,458 $ 328,047 $ 343,587 ======== ======== ======== ======== Net income per limited partnership interest $ 14.42 $ 19.37 $ 36.64 $ 38.37 ======== ======== ======== ========
The financial information included herein has been prepared by the managing general partner without audit by independent public accountants. The accompanying notes are an integral part of these financial statements. 4 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) STATEMENT OF PARTNERS' CAPITAL (Unaudited) Managing general Limited partner partners Total --------- ---------- ---------- Balance at January 1, 2001 $ 13,083 $1,298,370 $1,311,453 Distributions (2,614) (258,827) (261,441) Net income 3,314 328,047 331,361 -------- --------- --------- Balance at June 30, 2001 $ 13,783 $1,367,590 $1,381,373 ======== ========= =========
The financial information included herein has been prepared by the managing general partner without audit by independent public accountants. The accompanying notes are an integral part of these financial statements. 5 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) STATEMENTS OF CASH FLOWS (Unaudited) Six months ended June 30, ------------------------ 2001 2000 ---------- ---------- Cash flows from operating activities: Net income $ 331,361 $ 347,058 Adjustments to reconcile net income to net cash provided by operating activities: Depletion 36,755 35,517 Gain on disposition of assets (7,855) (8,845) Changes in assets and liabilities: Accounts receivable 59,934 (10,351) Accounts payable 8,682 9,046 --------- --------- Net cash provided by operating activities 428,877 372,425 --------- --------- Cash flows from investing activities: Additions to oil and gas properties (2,916) (5,439) Proceeds from asset dispositions 6,010 8,845 --------- --------- Net cash provided by investing activities 3,094 3,406 --------- --------- Cash flows used in financing activities: Cash distributions to partners (261,441) (351,856) --------- --------- Net increase in cash 170,530 23,975 Cash at beginning of period 144,763 129,430 --------- --------- Cash at end of period $ 315,293 $ 153,405 ========= =========
The financial information included herein has been prepared by the managing general partner without audit by independent public accountants. The accompanying notes are an integral part of these financial statements. 6 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS June 30, 2001 (Unaudited) Note 1. Organization and nature of operations Parker & Parsley 88-B, L.P. (the "Partnership") is a limited partnership organized in 1988 under the laws of the State of Delaware. The Partnership engages in oil and gas development and production in Texas and is not involved in any industry segment other than oil and gas. Note 2. Basis of presentation In the opinion of management, the unaudited financial statements of the Partnership as of June 30, 2001 and for the three and six months ended June 30, 2001 and 2000 include all adjustments and accruals consisting only of normal recurring accrual adjustments which are necessary for a fair presentation of the results for the interim period. These interim results are not necessarily indicative of results for a full year. Certain reclassifications may have been made to the June 30, 2000 financial statements to conform to the June 30, 2001 financial statement presentations. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted in this Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission. The financial statements should be read in conjunction with the financial statements and the notes thereto contained in the Partnership's Report on Form 10-K for the year ended December 31, 2000, as filed with the Securities and Exchange Commission, a copy of which is available upon request by writing to Rich Dealy, Vice President and Chief Accounting Officer, 5205 North O'Connor Boulevard, Suite 1400, Irving, Texas 75039-3746. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (1) Results of Operations Six months ended June 30, 2001 compared with six months ended June 30, 2000 Revenues: The Partnership's oil and gas revenues increased 4% to $613,966 for the six months ended June 30, 2001 as compared to $591,346 for the same period in 2000. The increase in revenues resulted from higher average prices received, offset by a decrease in production. For the six months ended June 30, 2001, 14,397 barrels 7 of oil, 4,692 barrels of natural gas liquids ("NGLs") and 20,792 mcf of gas were sold, or 22,554 barrel of oil equivalents ("BOEs"). For the six months ended June 30, 2000, 16,511 barrels of oil, 6,423 barrels of NGLs and 26,695 mcf of gas were sold, or 27,383 BOEs. The average price received per barrel of oil increased $1.33, or 5%, from $26.91 for the six months ended June 30, 2000 to $28.24 for the same period in 2001. The average price received per barrel of NGLs increased $3.39, or 24%, from $14.08 during the six months ended June 30, 2000 to $17.47 for the same period in 2001. The average price received per mcf of gas increased 184% from $2.12 during the six months ended June 30, 2000 to $6.03 for the same period in 2001. The market price for oil and gas has been extremely volatile in the past decade and management expects a certain amount of volatility to continue in the foreseeable future. The Partnership may therefore sell its future oil and gas production at average prices lower or higher than that received during the six months ended June 30, 2001. Gain on disposition of assets of $7,855 was received during the six months ended June 30, 2001 due to the sale of equipment on one well plugged and abandoned during the current period. Abandoned property costs of $10,241 were also incurred during the same period to plug and abandon this well. A gain of $8,845 was recognized during the same period in 2000 resulting from equipment credits received on one fully depleted well. Costs and Expenses: Total costs and expenses increased to $295,374 for the six months ended June 30, 2001 as compared to $258,310 for the same period in 2000, an increase of $37,064, or 14%. This increase was due to increases in production costs, abandoned property costs and depletion, offset by a decline in general and administrative expenses ("G&A"). Production costs were $233,029 for the six months ended June 30, 2001 and $205,053 for the same period in 2000 resulting in a $27,976 increase, or 14%. This increase was primarily due to additional workover and well maintenance costs incurred to stimulate well production and increased production taxes associated with higher oil and gas prices. G&A's components are independent accounting and engineering fees and managing general partner personnel and operating costs. During this period, G&A decreased 13% from $17,740 for the six months ended June 30, 2000 to $15,349 for the same period in 2001, primarily due to decreased audit and tax fees. Depletion was $36,755 for the six months ended June 30, 2001 as compared to $35,517 for the same period in 2000, an increase of $1,238, or 3%. This increase was primarily due to a reduction in proved reserves during the period ended June 30, 2001 as a result of lower commodity prices, offset by a decrease in oil production of 2,114 barrels for the six months ended June 30, 2001 as compared to the same period in 2000. 8 Three months ended June 30, 2001 compared with three months ended June 30, 2000 Revenues: The Partnership's oil and gas revenues decreased 5% to $287,569 for the three months ended June 30, 2001 as compared to $302,734 for the same period in 2000. The decrease in revenues resulted from lower average prices received for oil and a decline in production, offset by higher average prices received for gas and NGLs. For the three months ended June 30, 2001, 7,644 barrels of oil, 2,377 barrels of NGLs and 12,161 mcf of gas were sold, or 12,048 BOEs. For the three months ended June 30, 2000, 8,275 barrels of oil, 3,156 barrels of NGLs and 12,676 mcf of gas were sold, or 13,544 BOEs. The average price received per barrel of oil decreased $.56, or 2%, from $27.42 for the three months ended June 30, 2000 to $26.86 for the same period in 2001. The average price received per barrel of NGLs increased $1.22, or 9%, from $13.81 during the three months ended June 30, 2000 to $15.03 for the same period in 2001. The average price received per mcf of gas increased 50% from $2.55 during the three months ended June 30, 2000 to $3.83 for the same period in 2001. Gain on disposition of assets of $7,855 was received during the three months ended June 30, 2001 due to the sale of equipment on one well plugged and abandoned during the current period. Abandoned property costs of $10,241 were also incurred during the same period to plug and abandon this well. A gain of $8,845 was recognized during the same period in 2000 resulting from equipment credits received on one fully depleted well. Costs and Expenses: Total costs and expenses increased to $167,195 for the three months ended June 30, 2001 as compared to $139,453 for the same period in 2000, an increase of $27,742, or 20%. This increase was due to increases in production costs, abandoned property costs and depletion, offset by a decline in G&A. Production costs were $128,587 for the three months ended June 30, 2001 and $114,842 for the same period in 2000 resulting in a $13,745 increase, or 12%. The increase was primarily due to additional workover and well maintenance costs incurred to stimulate well production. During this period, G&A decreased 18% from $8,802 for the three months ended June 30, 2000 to $7,189 for the same period in 2001 due to lower percentage of the managing general partner's G&A being allocated (limited to 3% of oil and gas revenues) as a result of a decline in oil and gas revenues and a decrease in audit and tax fees. Depletion was $21,178 for the three months ended June 30, 2001 as compared to $15,809 for the same period in 2000, an increase of $5,369, or 34%. This increase was primarily due to a reduction in proved reserves during the period ended June 30, 2001 as a result of lower commodity prices, offset by a decline in oil production of 631 barrels for the three months ended June 30, 2001 as compared to the same period in 2000. 9 Liquidity and Capital Resources Net Cash Provided by Operating Activities Net cash provided by operating activities increased $56,452 during the six months ended June 30, 2001 from the same period ended June 30, 2000. This increase was primarily due to an increase of $22,357 in oil and gas sales receipts and reductions of $2,391 in G&A expenses and $69,921 in working capital, offset by increases in production costs of $27,976 and abandoned property costs of $10,241. The increase in oil and gas receipts resulted from the increase in commodity prices during 2001 which contributed an additional $147,904 to oil and gas receipts, offset by $125,547 resulting from the decline in production during 2001 as compared to the same period in 2000. The increase in production costs was primarily due to additional workover and well maintenance costs incurred to stimulate well production and increased production taxes associated with higher oil and gas prices. The decrease in G&A was primarily due to decreased audit and tax fees. Net Cash Provided by Investing Activities The Partnership's principal investing activities during the six months ended June 30, 2001 and 2000 were for equipment upgrades on active oil and gas properties. Proceeds from disposition of assets of $6,010 was recognized during the six months ended June 30, 2001. The proceeds were comprised of $5,485 received from the sale of equipment on one well plugged and abandoned during the current period and $525 from equipment credits received on two active wells. Proceeds of $8,845 recognized during the same period in 2000 were from equipment credits on one fully depleted well. Net Cash Used in Financing Activities For the six months ended June 30, 2001, cash distributions to the partners were $261,441, of which $2,614 was distributed to the managing general partner and $258,827 to the limited partners. For the same period ended June 30, 2000, cash distributions to the partners were $351,856, of which $3,519 was distributed to the managing general partner and $348,337 to the limited partners. For the three months ended June 30, 2001, no distributions were made by the partnership to its partners. Subsequent to June 30, 2001 the cash distribution that otherwise would have been mailed to partners in late June was made to holders of record as of July 9, 2001 and was mailed on July 13, 2001. For further information, see "Proposal to acquire partnerships" below. Proposal to acquire partnerships On June 29, 2001, Pioneer Natural Resources Company ("Pioneer") filed with the Securities and Exchange Commission Amendment No. 1 to the Form S-4 Registration Statement (File No. 333- 59094) (the "preliminary proxy statement/prospectus"), which proposes an agreement and plan of merger among Pioneer, Pioneer Natural Resources USA, Inc. ("Pioneer USA"), a wholly-owned subsidiary of Pioneer, and 46 Parker & Parsley limited partnerships. Each partnership that approves the agreement and plan of merger and the other related merger proposals will merge 10 with and into Pioneer USA upon the closing of the transactions described in the preliminary proxy statement/prospectus, and the partnership interests of each such partnership will be converted into the right to receive Pioneer common stock. The Partnership is one of the 46 Parker & Parsley limited partnerships that will be asked to approve the agreement and plan of merger. The preliminary proxy statement/prospectus is non-binding and is subject to, among other things, consideration of offers from third parties to purchase any partnership or its assets and the majority approval of the limited partnership interests in each partnership. Pioneer USA will solicit proxies from limited partners to approve the mergers only when the proxy statement/prospectus is final and declared effective. No solicitation will be made using preliminary materials. Nonetheless, copies of the preliminary proxy statement/prospectus may be obtained without charge upon request from Pioneer Natural Resources Company, 5205 North O'Connor Blvd., Suite 1400, Irving, Texas 75039, Attention: Investor Relations. The limited partners are urged to read the proxy statement/prospectus of Pioneer filed with the Securities and Exchange Commission, when it is finalized, because it contains important information about the proposed mergers, including information about the direct and indirect interests of Pioneer USA and Pioneer in the mergers. The limited partners may also obtain the preliminary and (when filed) final proxy statement/prospectus and other relevant documents relating to the proposed mergers free through the internet web site that the Securities and Exchange Commission maintains at www.sec.gov. - --------------- (1) "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" contains forward looking statements that involve risks and uncertainties. Accordingly, no assurances can be given that the actual events and results will not be materially different than the anticipated results described in the forward looking statements. Part II. Other Information Item 6. Exhibits and Reports on Form 8-K (a) Exhibits - none (b) Reports on Form 8-K - none 11 PARKER & PARSLEY 88-B, L.P. (A Delaware Limited Partnership) S I G N A T U R E S 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. PARKER & PARSLEY 88-B, L.P. By: Pioneer Natural Resources USA, Inc., Managing General Partner Dated: August 8, 2001 By: /s/ Rich Dealy --------------------------------- Rich Dealy, Vice President and Chief Accounting Officer 12 -----END PRIVACY-ENHANCED MESSAGE-----