FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
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 of (I.R.S. Employer
incorporation or organization) Identification No.)
Two West Second Street, Tulsa, Oklahoma 74103
---------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (918) 583-1791
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Depositary Units of Limited Partnership interest
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 the
filing requirements for the past 90 days. Yes X No
----- -----
-1-
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 Disclosure is not contained herein.
-----
Disclosure is contained herein.
-----
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).
Yes No X
----- -----
The Depositary Units are not publicly traded, therefore, Registrant cannot
compute the aggregate market value of the voting units held by non-affiliates of
the Registrant.
DOCUMENTS INCORPORATED BY REFERENCE: None
-2-
FORM 10-K
TABLE OF CONTENTS
PART I.......................................................................4
ITEM 1. BUSINESS...................................................4
ITEM 2. PROPERTIES................................................10
ITEM 3. LEGAL PROCEEDINGS.........................................28
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF LIMITED PARTNERS.......29
PART II.....................................................................29
ITEM 5. MARKET FOR UNITS AND RELATED LIMITED PARTNER MATTERS......29
ITEM 6. SELECTED FINANCIAL DATA...................................31
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.......................38
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK.........................................63
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA...............63
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.......................63
ITEM 9A. CONTROLS AND PROCEDURES...................................63
PART III....................................................................64
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE GENERAL PARTNER...64
ITEM 11. EXECUTIVE COMPENSATION....................................65
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT............................................73
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS............74
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES....................76
PART IV.....................................................................77
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
ON FORM 8-K...............................................77
SIGNATURES............................................................88
-3-
PART I
ITEM 1. BUSINESS
General
The Geodyne Energy Income Limited Partnership III-A (the "III-A
Partnership"), Geodyne Energy Income Limited Partnership III-B (the "III-B
Partnership"), Geodyne Energy Income Limited Partnership III-C (the "III-C
Partnership"), Geodyne Energy Income Limited Partnership III-D (the "III-D
Partnership"), Geodyne Energy Income Limited Partnership III-E (the "III-E
Partnership"), and Geodyne Energy Income Limited Partnership III-F (the "III-F
Partnership") (collectively, the "Partnerships") are limited partnerships formed
under the Oklahoma Revised Uniform Limited Partnership Act. Each Partnership is
composed of Geodyne Resources, Inc., a Delaware corporation, as general partner
("Geodyne" or the "General Partner"), Geodyne Depositary Company, a Delaware
corporation, as the sole initial limited partner, and public investors as
substitute limited partners (the "Limited Partners"). The Partnerships commenced
operations on the dates set forth below:
Date of
Partnership Activation
----------- ------------------
III-A November 22, 1989
III-B January 24, 1990
III-C February 27, 1990
III-D September 5, 1990
III-E December 26, 1990
III-F March 7, 1991
The General Partner currently serves as general partner of 26 limited
partnerships and is a wholly-owned subsidiary of Samson Investment Company.
Samson Investment Company and its various corporate subsidiaries, including the
General Partner (collectively "Samson"), are primarily engaged in the production
and development of and exploration for oil and gas reserves and the acquisition
and operation of producing properties. At December 31, 2003, Samson owned
interests in approximately 14,000 oil and gas wells located in 20 states of the
United States and the countries of Canada, Venezuela, Russia, and Australia. At
December 31, 2003, Samson operated approximately 4,000 oil and gas wells located
in 14 states of the United States as well as Canada, Venezuela, Russia, and
Australia.
The Partnerships are currently engaged in the business of owning interests
in producing oil and gas properties located in the continental United States.
The Partnerships may also engage to a limited extent in development drilling on
producing oil and
-4-
gas properties as required for the prudent management of the Partnerships.
As limited partnerships, the Partnerships have no officers, directors, or
employees. They rely instead on the personnel of the General Partner and Samson.
As of February 15, 2004, Samson employed approximately 1,000 persons. No
employees are covered by collective bargaining agreements, and management
believes that Samson provides a sound employee relations environment. For
information regarding the executive officers of the General Partner, see "Item
10. Directors and Executive Officers of the General Partner."
The General Partner's and the Partnerships' principal place of business is
located at Samson Plaza, Two West Second Street, Tulsa, Oklahoma 74103, and
their telephone number is (918) 583-1791 or (888) 436-3963 [(888) GEODYNE].
Pursuant to the terms of the partnership agreements for the Partnerships
(the "Partnership Agreements") the Partnerships were 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 Annual Report on Form 10-K ("Annual Report"), the General
Partner has extended the term of the III-A, III-B, and III-C Partnerships for
the third extension period, and the III-D, III-E and III-F Partnerships for the
second 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 2 September 5, 2004
III-E December 26, 2000 2 December 26, 2004
III-F March 7, 2001 2 March 7, 2005
The General Partner has not determined whether it will further extend the
term of any Partnership.
-5-
Funding
Although the Partnership Agreements permit the Partnerships to incur
borrowings, operations and expenses are currently funded out of each
Partnership's revenues from oil and gas sales. The General Partner may, but is
not required to, advance funds to a Partnership for the same purposes for which
Partnership borrowings are authorized.
Principal Products Produced and Services Rendered
The Partnerships' sole business is the production of, and related
incidental development of, oil and gas. The Partnerships do not refine or
otherwise process crude oil and condensate. The Partnerships do not hold any
patents, trademarks, licenses, or concessions and are not a party to any
government contracts. The Partnerships have no backlog of orders and do not
participate in research and development activities. The Partnerships are not
presently encountering shortages of oilfield tubular goods, compressors,
production material, or other equipment. However, recent substantial increases
in the price of steel may increase the costs of any future workover,
recompletion or drilling activities conducted by the Partnerships.
Competition and Marketing
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:
* Worldwide and domestic supplies of oil and natural gas;
* The ability of the members of the Organization of Petroleum Exporting
Countries ("OPEC") to agree upon 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;
-6-
* 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.
Significant Customers
The following customers accounted for ten percent or more of the
Partnerships' oil and gas sales during the year ended December 31, 2003:
-7-
Partnership Purchaser Percentage
----------- ------------------------ ----------
III-A Eaglwing Trading, Inc.
("Eaglwing") 27.0%
Valero Industrial Gas L.P.
("Valero") 23.9%
III-B Eaglwing 32.0%
Valero 20.3%
III-C Cinergy Marketing Company
("Cinergy") 23.2%
Duke Energy Field Services,
Inc. ("Duke") 19.6%
ONEOK Field Services Co.
("ONEOK") 17.7%
III-D Cinergy 28.1%
Eaglwing 23.9%
ONEOK 15.2%
Duke 14.5%
III-E Eaglwing 36.1%
Duke 13.7%
III-F Mountain Gas Resources, Inc. 19.7%
Duke 17.3%
Eaglwing 15.4%
In the event of interruption of purchases by one or more of the
Partnerships' significant customers or the cessation or material change in
availability of open access transportation by the Partnerships' pipeline
transporters, the Partnerships may encounter difficulty in marketing their gas
and in maintaining historic sales levels. Management does not expect any of its
open access transporters to seek authorization to terminate their transportation
services. Even if the services were terminated, management believes that
alternatives would be available whereby the Partnerships would be able to
continue to market their gas.
The Partnerships' principal customers for crude oil production are
refiners and other companies which have pipeline facilities near the producing
properties of the Partnerships. In the event pipeline facilities are not
conveniently available to production areas, crude oil is usually trucked by
purchasers to storage facilities.
-8-
Oil, Gas, and Environmental Control Regulations
Regulation of Production Operations -- The production of oil and gas is
subject to extensive federal and state laws and regulations governing a wide
variety of matters, including the drilling and spacing of wells, allowable rates
of production, prevention of waste and pollution, and protection of the
environment. In addition to the direct costs borne in complying with such
regulations, operations and revenues may be impacted to the extent that certain
regulations limit oil and gas production to below economic levels.
Regulation of Sales and Transportation of Oil and Gas -- Sales of crude
oil and condensate are made by the Partnerships at market prices and are not
subject to price controls. The sale of gas may be subject to both federal and
state laws and regulations. The provisions of these laws and regulations are
complex and affect all who produce, resell, transport, or purchase gas,
including the Partnerships. Although virtually all of the Partnerships' gas
production is not subject to price regulation, other regulations affect the
availability of gas transportation services and the ability of gas consumers to
continue to purchase or use gas at current levels. Accordingly, such regulations
may have a material effect on the Partnerships' operations and projections of
future oil and gas production and revenues.
Future Legislation -- Legislation affecting the oil and gas industry is
under constant review for amendment or expansion. Because such laws and
regulations are frequently amended or reinterpreted, management is unable to
predict what additional energy legislation may be proposed or enacted or the
future cost and impact of complying with existing or future regulations.
Regulation of the Environment -- The Partnerships' operations are subject
to numerous laws and regulations governing the discharge of materials into the
environment or otherwise relating to environmental protection. Compliance with
such laws and regulations, together with any penalties resulting from
noncompliance, may increase the cost of the Partnerships' operations or may
affect the Partnerships' ability to timely complete existing or future
activities. Management anticipates that various local, state, and federal
environmental control agencies will have an increasing impact on oil and gas
operations.
Insurance Coverage
The Partnerships are subject to all of the risks inherent in the
exploration for and production of oil and gas including blowouts, pollution,
fires, and other casualties. The Partnerships maintain insurance coverage as is
customary for entities of a similar size engaged in operations similar to that
of the Partnerships, but losses can occur from uninsurable risks or in amounts
in excess of existing insurance coverage. In particular, many types of pollution
and contamination can exist,
-9-
undiscovered, for long periods of time and can result in substantial
environmental liabilities which are not insured. The occurrence of an event
which is not fully covered by insurance could have a material adverse effect on
the Partnerships' financial condition and results of operations.
ITEM 2. PROPERTIES
Well Statistics
The following table sets forth the number of productive wells of the
Partnerships as of December 31, 2003.
Well Statistics(1)
As of December 31, 2003
Number of Gross Wells(2) Number of Net Wells(3)
-------------------------- ---------------------------
P/ship Total Oil Gas Total Oil Gas
- -------- ----- --- --- ------ ----- -----
III-A 193 90 103 12.24 3.73 8.51
III-B 165 81 84 7.99 3.98 4.01
III-C 184 63 121 20.75 11.51 9.24
III-D 189 126 63 11.78 6.67 5.11
III-E 252 101 151 28.43 7.17 21.26
III-F 386 274 112 16.78 7.07 9.71
- ----------
(1) The designation of a well as an oil well or gas well is made by the General
Partner based on the relative amount of oil and gas reserves for the well.
Regardless of a well's oil or gas designation, it may produce oil, gas, or
both oil and gas.
(2) As used in this Annual Report, "gross well" refers to a well in which a
working interest is owned; accordingly, the number of gross wells is the
total number of wells in which a working interest is owned.
(3) As used in this Annual Report, "net well" refers to the sum of the
fractional working interests owned in gross wells. For example, a 15%
working interest in a well represents one gross well, but 0.15 net well.
-10-
Drilling Activities
During the year ended December 31, 2003, the Partnerships directly or
indirectly participated in the drilling activities described below.
County/ Working Revenue
Well Name Parish St. Interest Interest Type Status
- --------- ------- --- -------- -------- ---- ------
III-A P/ship
- ------------
Rancho Blanco
#29 Webb TX 0.0000 0.0062 Gas Producing
Duke #1-C San Juan NM 0.0000 0.0004 Gas Producing
Senter #1-B San Juan NM 0.0512 0.0392 Gas Producing
Ira #1-29 Woods OK 0.0000 0.0073 n/a Dryhole
Peck #4-26 Caddo OK 0.0100 0.0081 Gas Producing
III-B P/ship
- ------------
Rancho Blanco
#29 Webb TX 0.0000 0.0029 Gas Producing
Duke #1-C San Juan NM 0.0000 0.0001 Gas Producing
Senter #1-B San Juan NM 0.0216 0.0165 Gas Producing
Peck #4-26 Caddo OK 0.0066 0.0054 Gas Producing
III-C P/ship
- ------------
Thomas #1-20 Washita OK 0.0000 0.0019 Gas Producing
Tiffany #4-35 Haskell OK 0.0040 0.0035 Gas Producing
Phillips #1-33 Latimer OK 0.0006 0.0006 Gas Producing
Urchison #4-12H Leflore OK 0.0000 0.0004 Gas Producing
Smitherman
#4-26H (RY) Haskell OK 0.0000 0.0006 Gas Producing
Sutmiller #1-8 Leflore OK 0.0059 0.0059 Gas Producing
Pixler 5-15H
(RY) Haskell OK 0.0000 0.0011 Gas Producing
Cantrell 4-15H
(RY) Haskell OK 0.0000 0.0011 Gas Producing
Wimberly #5-27H
(RY) Haskell OK 0.0000 0.0002 Gas Producing
Wimberly #3-27H
(RY) Haskell OK 0.0000 0.0002 Gas Producing
Ellis #1-23 Pittsburg OK 0.0000 0.0003 Gas Producing
Beaver Mountain
#1-14 Haskell OK 0.0048 0.0048 Gas Shut-in
Rancho Blanco
#29 Webb TX 0.0000 0.0012 Gas Producing
Sugg 1895 #6 Irion TX 0.0000 0.0021 Gas Producing
Sugg 1895 #7 Irion TX 0.0000 0.0021 Gas Producing
Sugg AA 1894
#3 Irion TX 0.0000 0.0021 Oil Producing
-11-
Duke #1-C San Juan NM 0.0000 0.0001 Gas Producing
Senter #1-B San Juan NM 0.0090 0.0069 Gas Producing
Renete #2-25 Stephens OK 0.0000 0.0023 Gas Producing
Verner #1-11 Pittsburg OK 0.0000 0.0037 Gas Producing
Hamilton #4-13
(RY) Pittsburg OK 0.0000 0.0063 Gas Producing
Lindsey #1-11
(RY) Pittsburg OK 0.0000 0.0037 n/a Well in
progress
McEntire #16-14 Atoka OK 0.0001 0.0001 n/a Well in
progress
III-D P/ship
- ------------
Thomas #1-20 Washita OK 0.0000 0.0003 Gas Producing
Tiffany #4-35 Haskell OK 0.0006 0.0005 Gas Producing
Phillips #1-33 Latimer OK 0.0005 0.0005 Gas Producing
Urchison #4-12H Leflore OK 0.0000 0.0001 Gas Producing
Smitherman
#4-26H (RY) Haskell OK 0.0000 0.0001 Gas Producing
Sutmiller #1-8 Leflore OK 0.0008 0.0008 Gas Producing
Forster #1-34
(RY) Pittsburg OK 0.0000 0.0012 Gas Producing
Pixler 5-15H
(RY) Haskell OK 0.0000 0.0002 Gas Producing
Cantrell 4-15H
(RY) Haskell OK 0.0000 0.0002 Gas Producing
Wimberly #5-27H
(RY) Haskell OK 0.0000 0.0000 Gas Producing
Wimberly #3-27H
(RY) Haskell OK 0.0000 0.0000 Gas Producing
Ellis #1-23 Pittsburg OK 0.0000 0.0000 Gas Producing
Beaver Mountain
#1-14 Haskell OK 0.0007 0.0007 Gas Shut-in
Sugg 1895 #6 Irion TX 0.0000 0.0018 Gas Producing
Sugg 1895 #7 Irion TX 0.0000 0.0018 Gas Producing
Sugg AA 1894 #3 Irion TX 0.0000 0.0018 Oil Producing
Renete #2-25 Stephens OK 0.0000 0.0003 Gas Producing
Verner #1-11 Pittsburg OK 0.0000 0.0005 Gas Producing
Hamilton #4-13
(RY) Pittsburg OK 0.0000 0.0009 Gas Producing
Lindsey #1-11
(RY) Pittsburg OK 0.0000 0.0005 n/a Well in
progress
McEntire #16-14 Atoka OK 0.0000 0.0000 n/a Well in
progress
III-E P/ship
- ------------
Forster #1-34
(RY) Pittsburg OK 0.0000 0.0002 Gas Producing
Hay Reservoir
Unit #80 Sweetwater WY 0.0000 0.0026 Gas Producing
-12-
Hay Reservoir
Unit #81 Sweetwater WY 0.0000 0.0026 Gas Producing
Hay Reservoir
Unit #82 Sweetwater WY 0.0000 0.0026 Gas Producing
Hay Reservoir
Unit #85 Sweetwater WY 0.0000 0.0026 Gas Producing
St. 5075-36-
11WA Campbell WY 0.0000 0.0006 Gas Shut-in
St. 5075-36-
41WA Campbell WY 0.0000 0.0019 n/a Well in
progress
St. 5075-36-
13WA Campbell WY 0.0000 0.0006 n/a Well in
progress
St. 5075-36-
23WA Campbell WY 0.0000 0.0019 n/a Well in
progress
St. 5075-36-
33WA Campbell WY 0.0000 0.0006 n/a Well in
progress
St. 5075-36-
31WA Campbell WY 0.0000 0.0006 n/a Well in
progress
Love 5075-14-
21WA Campbell WY 0.0000 0.0014 n/a Well in
progress
Love 5075-14-
11WA Campbell WY 0.0000 0.0014 n/a Well in
progress
Love 5075-11-
43WA Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-14-
13WA Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-11-
41WA Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-11-
33WA Campbell WY 0.0000 0.0005 n/a Well in
progress
Love 5075-11-
43CO Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-11-
41CO Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-14-
13CO Campbell WY 0.0000 0.0010 n/a Well in
progress
Love 5075-14-
11CO Campbell WY 0.0000 0.0014 n/a Well in
progress
-13-
Love 5075-14-
33WA Campbell WY 0.0000 0.0019 n/a Well in
progress
Love 5075-14-
23WA Campbell WY 0.0000 0.0019 n/a Well in
progress
Love 5075-11-
33CO Campbell WY 0.0000 0.0005 n/a Well in
progress
Love 5075-14-
33CO Campbell WY 0.0000 0.0019 n/a Well in
progress
Love 5075-14-
21CO Campbell WY 0.0000 0.0014 n/a Well in
progress
Love 5075-14-
23CO Campbell WY 0.0000 0.0019 n/a Well in
progress
North Hay
Federal
#10-17 Sweetwater WY 0.0000 0.0014 n/a Dryhole
St. 5075-36-
43WA Campbell WY 0.0000 0.0019 n/a Well in
progress
Hay Reservoir
Unit #86 Sweetwater WY 0.0000 0.0026 n/a Well in
progress
III-F P/ship
- ------------
Hay Reservoir
Unit #80 Sweetwater WY 0.0000 0.0022 Gas Producing
Hay Reservoir
Unit #81 Sweetwater WY 0.0000 0.0022 Gas Producing
Hay Reservoir
Unit #82 Sweetwater WY 0.0000 0.0022 Gas Producing
Hay Reservoir
Unit #85 Sweetwater WY 0.0000 0.0022 Gas Producing
North Hay
Federal
#10-17 Sweetwater WY 0.0000 0.0016 n/a Dryhole
Hay Reservoir
Unit #86 Sweetwater WY 0.0000 0.0022 n/a Well in
progress
- -----------------------------
Oil and Gas Production, Revenue, and Price History
The following tables set forth certain historical information concerning
the oil (including condensates) and gas production, net of all royalties,
overriding royalties, and other third party interests, of the Partnerships,
revenues attributable to such production, and certain price and cost
information. As used in
-14-
the following tables, direct operating expenses include lease operating expenses
and production taxes. In addition, gas production is converted to oil
equivalents at the rate of six Mcf per barrel, representing the estimated
relative energy content of gas and oil, which rate is not necessarily indicative
of the relationship of oil and gas prices. The respective prices of oil and gas
are affected by market and other factors in addition to relative energy content.
-15-
Net Production Data
III-A Partnership
-----------------
Year Ended December 31,
-------------------------------------
2003 2002 2001
---------- ---------- ----------
Production:
Oil (Bbls) 45,080 54,340 82,520
Gas (Mcf) 516,905 908,912 791,697
Oil and gas sales:
Oil $1,336,984 $1,316,966 $2,030,557
Gas 2,702,323 2,558,132 3,394,606
--------- --------- ---------
Total $4,039,307 $3,875,098 $5,425,163
========= ========= =========
Total direct operating
expenses $ 836,517 $ 915,252 $1,020,090
========= ========= =========
Direct operating expenses
as a percentage of oil
and gas sales 20.7% 23.6% 18.8%
Average sales price:
Per barrel of oil $29.66 $24.24 $24.61
Per Mcf of gas 5.23 2.81 4.29
Direct operating expenses
per equivalent Bbl of
oil $ 6.37 $ 4.45 $ 4.76
-16-
Net Production Data
III-B Partnership
-----------------
Year Ended December 31,
-------------------------------------
2003 2002 2001
---------- ---------- ----------
Production:
Oil (Bbls) 31,275 39,042 58,965
Gas (Mcf) 243,753 486,057 400,249
Oil and gas sales:
Oil $ 931,510 $ 949,685 $1,457,455
Gas 1,276,052 1,326,476 1,689,008
--------- --------- ---------
Total $2,207,562 $2,276,161 $3,146,463
========= ========= =========
Total direct operating
expenses $ 509,231 $ 622,936 $ 630,746
========= ========= =========
Direct operating expenses
as a percentage of oil
and gas sales 23.1% 27.4% 20.0%
Average sales price:
Per barrel of oil $29.78 $24.32 $24.72
Per Mcf of gas 5.24 2.73 4.22
Direct operating expenses
per equivalent Bbl of
oil $ 7.08 $ 5.19 $ 5.02
-17-
Net Production Data
III-C Partnership
-----------------
Year Ended December 31,
-------------------------------------
2003 2002 2001
---------- ---------- ----------
Production:
Oil (Bbls) 13,872 14,716 14,973
Gas (Mcf) 668,059 817,975 935,377
Oil and gas sales:
Oil $ 416,104 $ 361,020 $ 382,250
Gas 3,185,294 2,379,868 3,988,865
--------- --------- ---------
Total $3,601,398 $2,740,888 $4,371,115
========= ========= =========
Total direct operating
expenses $ 868,275 $ 858,126 $ 980,377
========= ========= =========
Direct operating expenses
as a percentage of oil
and gas sales 24.1% 31.3% 22.4%
Average sales price:
Per barrel of oil $30.00 $24.53 $25.53
Per Mcf of gas 4.77 2.91 4.26
Direct operating expenses
per equivalent Bbl of
oil $ 6.93 $ 5.68 $ 5.74
-18-
Net Production Data
III-D Partnership
-----------------
Year Ended December 31,
-------------------------------------
2003 2002 2001
---------- ---------- ----------
Production:
Oil (Bbls) 26,438 25,279 27,570
Gas (Mcf) 387,346 501,256 561,664
Oil and gas sales:
Oil $ 718,528 $ 563,269 $ 610,171
Gas 1,795,250 1,413,445 2,302,188
--------- --------- ---------
Total $2,513,778 $1,976,714 $2,912,359
========= ========= =========
Total direct operating
expenses $ 790,773 $ 880,922 $ 914,671
========= ========= =========
Direct operating expenses
as a percentage of oil
and gas sales 31.5% 44.6% 31.4%
Average sales price:
Per barrel of oil $27.18 $22.28 $22.13
Per Mcf of gas 4.63 2.82 4.10
Direct operating expenses
per equivalent Bbl of
oil $ 8.69 $ 8.10 $ 7.55
-19-
Net Production Data
III-E Partnership
-----------------
Year Ended December 31,
---------------------------------------
2003 2002 2001
---------- ---------- -----------
Production:
Oil (Bbls) 129,314 133,901 162,557
Gas (Mcf) 854,720 1,000,715 1,226,795
Oil and gas sales:
Oil $3,404,768 $2,858,109 $3,486,759
Gas 3,916,448 2,517,891 4,751,785
--------- --------- ---------
Total $7,321,216 $5,376,000 $8,238,544
========= ========= ==========
Total direct operating
expenses $3,198,044 $3,574,658 $3,511,241
========= ========= ==========
Direct operating expenses
as a percentage of oil
and gas sales 43.7% 66.5% 42.6%
Average sales price:
Per barrel of oil $26.33 $21.34 $21.45
Per Mcf of gas 4.58 2.52 3.87
Direct operating expenses
per equivalent Bbl of
oil $11.77 $11.89 $ 9.57
-20-
Net Production Data
III-F Partnership
-----------------
Year Ended December 31,
-------------------------------------
2003 2002 2001
---------- ---------- ----------
Production:
Oil (Bbls) 20,685 23,209 27,090
Gas (Mcf) 412,842 503,895 621,792
Oil and gas sales:
Oil $ 598,509 $ 529,406 $ 603,765
Gas 1,881,269 1,107,352 2,330,535
--------- --------- ---------
Total $2,479,778 $1,636,758 $2,934,300
========= ========= =========
Total direct operating
expenses $ 754,502 $ 603,358 $ 891,493
========= ========= =========
Direct operating expenses
as a percentage of oil
and gas sales 30.4% 36.9% 30.4%
Average sales price:
Per barrel of oil $28.93 $22.81 $22.29
Per Mcf of gas 4.56 2.20 3.75
Direct operating expenses
per equivalent Bbl of
oil $ 8.43 $ 5.63 $ 6.82
Proved Reserves and Net Present Value
The following table sets forth each Partnership's estimated proved oil and
gas reserves and net present value therefrom as of December 31, 2003. The
schedule of quantities of proved oil and gas reserves was prepared by the
General Partner in accordance with the rules prescribed by the Securities and
Exchange Commission (the "SEC"). Certain reserve information was reviewed by
Ryder Scott Company, L.P. ("Ryder Scott"), an independent petroleum engineering
firm. As used throughout this Annual Report, "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.
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
-21-
valorem taxes, and operating expenses) and estimated future development costs,
discounted at 10% per annum. Net present value attributable to the Partnerships'
proved reserves was calculated on the basis of current costs and prices at
December 31, 2003. Such prices were not escalated except in certain
circumstances where escalations were fixed and readily determinable in
accordance with applicable contract provisions. Oil and gas prices at December
31, 2003 ($29.25 per barrel and $5.77 per Mcf, respectively) were higher than
the prices in effect on December 31, 2002 ($28.00 per barrel and $4.74 per Mcf,
respectively). This increase in oil and gas prices has caused the estimates of
remaining economically recoverable reserves, as well as the values placed on
said reserves, at December 31, 2003 to be higher than such estimates and values
at December 31, 2002. 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 December 31, 2003. There
can be no assurance that the prices used in calculating the net present value of
the Partnerships' proved reserves at December 31, 2003 will actually be realized
for such production.
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 near 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.
Proved Reserves and
Net Present Values
From Proved Reserves
As of December 31, 2003(1)
III-A Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 4,039,478
Oil and liquids (Bbls) 139,211
Net present value (discounted at
10% per annum) $13,377,306
-22-
III-B Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 1,677,840
Oil and liquids (Bbls) 87,639
Net present value (discounted at
10% per annum) $ 6,143,806
III-C Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 5,349,105
Oil and liquids (Bbls) 99,719
Net present value (discounted at
10% per annum) $13,637,641
III-D Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 2,652,614
Oil and liquids (Bbls) 157,044
Net present value (discounted at
10% per annum) $ 6,989,483
III-E Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 6,565,947
Oil and liquids (Bbls) 674,924
Net present value (discounted at
10% per annum) $16,923,995
III-F Partnership:
-----------------
Estimated proved reserves:
Gas (Mcf) 4,482,383
Oil and liquids (Bbls) 360,288
Net present value (discounted at
10% per annum) $12,072,331
- ----------
(1) Includes certain gas balancing adjustments which cause the gas volumes and
net present values to differ from the reserve reports which were prepared
by the General Partner and reviewed by Ryder Scott.
-23-
No estimates of the proved reserves of the Partnerships comparable to
those included herein have been included in reports to any federal agency other
than the SEC. Additional information relating to the Partnerships' proved
reserves is contained in Note 4 to the Partnerships' financial statements,
included in Item 8 of this Annual Report.
Significant Properties
The following table sets forth the number and percent of each
Partnership's total wells which are operated by affiliates of the Partnerships
as of December 31, 2003:
Operated Wells
-------------------------------------
Partnership Number Percent
----------- ------ -------
III-A 20 8%
III-B 4 2%
III-C 109 26%
III-D 102 27%
III-E 48 16%
III-F 27 7%
The following tables set forth certain well and reserve information as of
December 31, 2003 for the basins in which the Partnerships own a significant
amount of oil and gas properties. The tables contain the following information
for each significant basin: (i) the number of gross wells and net wells, (ii)
the number of wells in which only a non-working interest is owned, (iii) the
Partnership's total number of wells, (iv) the number of wells operated by the
Partnership's affiliates, (v) estimated proved oil reserves, (vi) estimated
proved gas reserves, and (vii) the present value (discounted at 10% per annum)
of estimated future net cash flow.
The Anadarko Basin is located in western Oklahoma and the Texas panhandle.
The Gulf Coast Basin is located in southern Louisiana and southeast Texas, while
the Las Animas Arch Basin straddles east Colorado and northwest Kansas. Southern
Oklahoma contains the Southern Oklahoma Folded Belt Basin. The Jay-Little
Escambia Creek Field Unit ("Jay-LEC Unit") is located in Santa Rosa County,
Florida, while the Green River Basin is located in southern Wyoming and
northwest Colorado. The Permian Basin straddles west Texas and southeast New
Mexico.
-24-
Significant Properties as of December 31, 2003
----------------------------------------------
Wells
Operated by
Affiliates Oil Gas
Gross Net Other Total ------------ Reserves Reserves Present
Basin Wells Wells Wells(1) Wells Number %(2) (Bbl) (Mcf) Value
- ------------------ ------ ------- -------- ------ ------ ---- -------- --------- ----------
III-A Partnership:
Gulf Coast 65 5.30 48 113 4 4% 126,833 1,573,609 $7,246,383
Anadarko 32 2.03 15 47 14 30% 5,157 1,650,566 4,407,127
III-B Partnership:
Gulf Coast 61 2.98 48 109 - - 82,798 775,223 $3,906,191
Anadarko 38 2.48 9 47 3 6% 1,412 492,897 1,336,490
III-C Partnership:
Anadarko 55 6.26 55 110 27 25% 6,429 2,509,715 $6,686,330
Southern Okla.
Folded Belt 36 6.98 15 51 21 41% 56,222 1,712,218 4,334,175
Permian 25 6.60 11 36 32 89% 35,654 719,994 1,353,955
III-D Partnership:
Anadarko 33 3.55 55 88 27 31% 3,074 1,875,390 $4,923,359
Permian 25 5.52 11 36 32 89% 23,830 577,988 980,561
Southern Okla.
Folded Belt 27 1.93 13 40 14 35% 42,716 166,571 729,421
Jay-LEC Unit 86 .56 - 86 - - 72,676 13,456 120,022
- ---------------------
(1) Wells in which only a non-working (e.g. royalty) interest is owned.
(2) Percentage of wells in the applicable basin which are operated by affiliates
of the Partnerships.
-25-
Significant Properties as of December 31, 2003
----------------------------------------------
Wells
Operated by
Affiliates Oil Gas
Gross Net Other Total ------------ Reserves Reserves Present
Basin Wells Wells Wells(1) Wells Number %(2) (Bbl) (Mcf) Value
- ------------------ ------ ------- -------- ------ ------ ---- --------- ---------- ----------
III-E Partnership:
Green River 55 4.24 16 71 - - 18,048 2,845,591 $6,254,308
Gulf Coast 49 5.33 8 57 6 11% 12,302 1,060,584 3,148,369
Anadarko 21 5.09 3 24 19 79% 10,076 1,109,490 2,407,470
East Texas 3 1.06 1 4 3 75% 2,840 838,613 1,836,570
Jay-LEC Unit 86 4.01 - 86 - - 518,676 101,437 874,415
III-F Partnership:
Green River 55 3.56 16 71 - - 15,156 2,394,146 $5,222,283
Las Animas Arch 66 1.73 - 66 - - 151,042 555,501 2,391,801
Anadarko 26 5.68 3 29 24 83% 20,927 1,024,856 2,205,953
- --------------------
(1) Wells in which only a non-working (e.g. royalty) interest is owned.
(2) Percentage of wells in the applicable basin which are operated by affiliates
of the Partnerships.
-26-
Following is a description of those oil and gas properties whose revisions
in the estimated proved reserves (based on equivalent barrels of oil) as of
December 31, 2003, as compared to December 31, 2002, were significant to the
Partnerships.
The III-A and III-B Partnerships' estimated proved reserves increased
approximately 117,000 and 77,000 barrels of oil equivalent, respectively, in the
Amoco Fee #3 located in Jefferson Davis Parish, Louisiana from December 31, 2002
to December 31, 2003. This increase was primarily due to a revised forecast in
reserves based on actual production experience. In addition, the III-A and III-B
Partnerships' estimated proved reserves decreased approximately 30,000 and
20,000 barrels of oil equivalent, respectively, in the Donald #1 located in
Jefferson Davis Parish, Louisiana from December 31, 2002 to December 31, 2003.
This decrease was primarily due to a downward revision of behind pipe reserves.
The III-D and III-E Partnerships' estimated proved reserves decreased
approximately 70,000 and 552,000 barrels of oil equivalent, respectively, in the
Jay-Little Escambia Creek Field Unit located in Santa Rosa County, Florida from
December 31, 2002 to December 31, 2003. The significant downward adjustment in
future oil production, as well as an increase in estimated future operating
expenses and abandonment expenditures, have also significantly reduced the
estimated value of this property's reserves. These changes have been made as a
result of the reduced oil production and higher production, workover and well
abandonment expenses realized over the last several months. See the "Liquidity
and Capital Resources" section located in "Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations" for a further
discussion of this property.
The III-F Partnership's estimated proved reserves increased approximately
98,000 barrels of oil equivalent in the Healdton Unit #1 located in Carter
County, Oklahoma from December 31, 2002 to December 31, 2003. This increase was
primarily due to a revised forecast in reserves based on actual production
experience. The III-F Partnership's estimated proved reserves increased
approximately 91,000 barrels of oil equivalent in the Frontera B Unit located in
Cheyenne County, Colorado from December 31, 2002 to December 31, 2003. This
increase was primarily due to a revised forecast in reserves based on actual
production experience. In addition, the III-F Partnership's estimated proved
reserves decreased approximately 82,000 barrels of oil equivalent in the Trail
Unit located in Sweetwater County, Wyoming from December 31, 2002 to December
31, 2003. This decrease was primarily due to a revised forecast in reserves
based on actual production experience.
-27-
Title to Oil and Gas Properties
Management believes that the Partnerships have satisfactory title to their
oil and gas properties. Record title to all of the Partnerships' properties is
held by either the Partnerships or Geodyne Nominee Corporation, an affiliate of
the General Partner.
Title to the Partnerships' properties is subject to customary royalty,
overriding royalty, carried, working, and other similar interests and
contractual arrangements customary in the oil and gas industry, to liens for
current taxes not yet due, and to other encumbrances. Management believes that
such burdens do not materially detract from the value of such properties or from
the Partnerships' interest therein or materially interfere with their use in the
operation of the Partnerships' business.
ITEM 3. 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, in an effort to minimize potential exposure created by
the Wyoming statutes and accompanying legal fees, Samson refunded to the royalty
and overriding royalty interest owners who were potential class members all of
the amounts which were claimed to be 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.
-28-
Except as set forth above, to the knowledge of the General Partner,
neither the General Partner nor the Partnerships or their properties are subject
to any litigation, the results of which would have a material effect on the
Partnerships' or the General Partner's financial condition or operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF LIMITED PARTNERS
There were no matters submitted to a vote of the Limited Partners of any
Partnership during 2003.
PART II
ITEM 5. MARKET FOR UNITS AND RELATED LIMITED PARTNER MATTERS
As of March 3, 2004, the number of Units outstanding and the approximate
number of Limited Partners of record in the Partnerships were as follows:
Number of Number of
Partnership Units Limited Partners
----------- --------- ----------------
III-A 263,976 1,155
III-B 138,336 682
III-C 244,536 1,096
III-D 131,008 578
III-E 418,266 1,795
III-F 221,484 933
Units were initially sold for a price of $100. Units are not traded on any
exchange and there is no public trading market for them. The General Partner is
aware of certain transfers of Units between unrelated parties, some of which are
facilitated by secondary trading firms and matching services. In addition, as
further described below, the General Partner is aware of certain "4.9% Tender
Offers" which have been made for the Units. The General Partner believes that
the transfers between unrelated parties have been limited and sporadic in number
and volume. Other than trades facilitated by certain secondary trading firms and
matching services, no organized trading market for Units exists and none is
expected to develop. Due to the nature of these transactions, the General
Partner has no verifiable information regarding prices at which Units have been
transferred. Further, a transferee may not become a substitute Limited Partner
without the consent of the General Partner.
Pursuant to the terms of the Partnership Agreements, the General Partner
is obligated to annually issue a repurchase offer which is based on the
estimated future net revenues from the
-29-
Partnerships' reserves and is calculated pursuant to the terms of the
Partnership Agreements. Such repurchase offer is recalculated monthly in order
to reflect cash distributions to the Limited Partners and extraordinary events.
The following table sets forth the General Partner's repurchase offer per Unit
as of the periods indicated. For purpose of this Annual Report, a Unit
represents an initial subscription of $100 to a Partnership.
Repurchase Offer Prices
-----------------------
2002 2003 2004
------------------------- ------------------------- ----
1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st
P/ship Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr.
- ------ ---- ---- ---- ---- ---- ---- ---- ---- ----
III-A $14 $13 $20 $18 $16 $14 $20 $18 $16
III-B 13 11 20 18 16 13 17 14 13
III-C 16 15 18 17 16 14 26 24 22
III-D 19 19 23 22 21 18 28 25 23
III-E 24 24 25 25 24 23 22 21 19
III-F 22 21 20 19 18 18 26 24 23
In addition to this repurchase offer, some of the Partnerships have been
subject to "4.9% tender offers" from several third parties. The General Partner
does not know the terms of these offers or the prices received by the Limited
Partners who accepted these offers.
Cash Distributions
Cash distributions are primarily dependent upon a Partnership's cash
receipts from the sale of oil and gas production and cash requirements of the
Partnership. Distributable cash is determined by the General Partner at the end
of each calendar quarter and distributed to the Limited Partners within 45 days
after the end of the quarter. Distributions are restricted to cash on hand less
amounts required to be retained out of such cash as determined in the sole
judgment of the General Partner to pay costs, expenses, or other Partnership
obligations whether accrued or anticipated to accrue. In certain instances, the
General Partner may not distribute the full amount of cash receipts which might
otherwise be available for distribution in an effort to equalize or stabilize
the amounts of quarterly distributions. Any available amounts not distributed
are invested and the interest or income thereon is for the accounts of the
Limited Partners.
-30-
The following is a summary of cash distributions paid to the Limited
Partners during 2002, 2003, and the first quarter of 2004:
Cash Distributions
------------------
2002
-----------------------------------------
1st 2nd 3rd 4th
P/ship Qtr. Qtr. Qtr. Qtr.
------ ----- ----- ----- -----
III-A $3.20 $1.49 $1.73 $2.46
III-B 3.48 1.63 1.72 2.56
III-C 1.35 .90 1.26 1.26
III-D .75 .44 1.34 1.22
III-E - - .27 .36
III-F .64 .85 .59 .52
2003 2004
----------------------------------------- -----
1st 2nd 3rd 4th 1st
P/ship Qtr. Qtr. Qtr. Qtr. Qtr.
------ ----- ----- ----- ----- -----
III-A $1.78 $2.39 $3.21 $2.51 $1.81
III-B 1.85 2.41 3.05 2.45 1.64
III-C 1.07 2.06 2.56 2.45 1.79
III-D 1.26 2.63 3.20 2.46 2.15
III-E .64 .87 1.91 1.68 2.06
III-F .74 .70 1.72 1.56 1.35
ITEM 6. SELECTED FINANCIAL DATA
The following tables present selected financial data for the Partnerships.
This data should be read in conjunction with the financial statements of the
Partnerships and the respective notes thereto, included elsewhere in this Annual
Report. See "Item 8. Financial Statements and Supplementary Data."
-31-
Selected Financial Data
III-A Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------ ------------
Oil and Gas Sales $4,039,307 $3,875,098 $5,425,163 $4,111,261 $2,071,891
Net Income:
Limited Partners 2,419,111 1,822,932 3,211,072 2,424,492 717,149
General Partner 286,852 256,987 405,019 275,300 54,650
Total 2,705,963 2,079,919 3,616,091 2,699,792 771,799
Limited Partners' Net
Income per Unit 9.16 6.91 12.16 9.18 2.72
Limited Partners' Cash
Distributions per
Unit 9.89 8.88 14.66 6.42 3.30
Total Assets 2,357,510 2,465,350 3,086,819 3,585,623 2,793,806
Partners' Capital
(Deficit):
Limited Partners 2,213,330 2,405,219 2,927,287 3,587,215 2,857,723
General Partner ( 104,097) ( 87,091) ( 114,834) ( 132,196) ( 194,823)
Number of Units
Outstanding 263,976 263,976 263,976 263,976 263,976
-32-
Selected Financial Data
III-B Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------ ------------
Oil and Gas Sales $2,207,562 $2,276,161 $3,146,463 $2,462,438 $1,259,735
Net Income:
Limited Partners 1,171,730 916,420 1,701,127 1,364,829 417,755
General Partner 227,153 216,453 348,971 264,081 110,131
Total 1,398,883 1,132,873 2,050,098 1,628,910 527,886
Limited Partners' Net
Income per Unit 8.47 6.62 12.30 9.87 3.02
Limited Partners' Cash
Distributions per
Unit 9.76 9.39 14.44 7.34 3.27
Total Assets 1,270,257 1,390,931 1,830,746 2,069,748 1,690,316
Partners' Capital
(Deficit):
Limited Partners 1,178,224 1,357,494 1,741,074 2,037,947 1,687,118
General Partner ( 68,928) ( 48,554) ( 67,276) ( 38,756) ( 79,362)
Number of Units
Outstanding 138,336 138,336 138,336 138,336 138,336
-33-
Selected Financial Data
III-C Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------ ------------
Oil and Gas Sales $3,601,398 $2,740,888 $4,371,115 $4,150,431 $2,446,824
Net Income:
Limited Partners 2,016,059 1,178,582 2,653,485 2,554,851 1,053,071
General Partner 243,670 158,236 163,926 143,251 75,430
Total 2,259,729 1,336,818 2,817,411 2,698,102 1,128,501
Limited Partners' Net
Income per Unit 8.24 4.82 10.85 10.45 4.31
Limited Partners' Cash
Distributions per
Unit 8.14 4.77 16.36 8.45 4.98
Total Assets 2,902,685 2,751,198 2,627,295 3,949,266 3,447,965
Partners' Capital
(Deficit):
Limited Partners 2,542,860 2,517,801 2,507,219 3,854,734 3,364,883
General Partner ( 153,480) ( 150,636) ( 175,495) ( 152,824) ( 168,448)
Number of Units
Outstanding 244,536 244,536 244,536 244,536 244,536
-34-
Selected Financial Data
III-D Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------ ------------
Oil and Gas Sales $2,513,778 $1,976,714 $2,912,359 $3,095,191 $2,007,243
Net Income:
Limited Partners 1,293,974 705,530 1,630,013 1,893,355 870,221
General Partner 155,435 93,120 107,057 109,411 55,068
Total 1,449,409 798,650 1,737,070 2,002,766 925,289
Limited Partners' Net
Income per Unit 9.88 5.39 12.44 14.45 6.64
Limited Partners' Cash
Distributions per
Unit 9.55 3.75 19.36 13.21 5.87
Total Assets 1,731,542 1,458,550 1,157,930 1,987,262 1,810,172
Partners' Capital
(Deficit):
Limited Partners 1,129,328 1,086,354 872,824 1,779,811 1,618,456
General Partner ( 47,561) ( 50,949) ( 72,956) ( 58,871) ( 66,221)
Number of Units
Outstanding 131,008 131,008 131,008 131,008 131,008
-35-
Selected Financial Data
III-E Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------- ------------
Oil and Gas Sales $7,321,216 $5,376,000 $8,238,544 $10,477,026 $7,046,449
Net Income:
Limited Partners 2,940,848 798,510 3,744,610 6,952,136 2,016,127
General Partner 367,060 127,708 261,289 378,449 124,846
Total 3,307,908 926,218 4,005,899 7,330,585 2,140,973
Limited Partners' Net
Income per Unit 7.03 1.91 8.95 16.62 4.82
Limited Partners' Cash
Distributions per
Unit 5.10 .63 14.81 15.73 2.62
Total Assets 6,654,923 4,442,417 3,768,636 6,138,734 5,742,231
Partners' Capital
(Deficit):
Limited Partners 4,302,533 3,492,685 2,960,175 5,410,565 5,037,429
General Partner ( 177,234) ( 250,684) ( 286,758) ( 240,721) ( 259,526)
Number of Units
Outstanding 418,266 418,266 418,266 418,266 418,266
-36-
Selected Financial Data
III-F Partnership
-----------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------ ------------
Oil and Gas Sales $2,479,778 $1,636,758 $2,934,300 $3,437,321 $2,314,446
Net Income:
Limited Partners 1,176,685 460,816 1,782,241 2,142,067 801,095
General Partner 70,747 35,680 103,349 125,735 59,101
Total 1,247,432 496,496 1,885,590 2,267,802 860,196
Limited Partners' Net
Income per Unit 5.31 2.08 8.05 9.67 3.62
Limited Partners' Cash
Distributions per
Unit 4.72 2.60 13.62 9.59 2.23
Total Assets 2,592,302 2,427,147 2,369,806 3,638,555 3,689,702
Partners' Capital
(Deficit):
Limited Partners 2,374,722 2,245,037 2,359,221 3,593,980 3,575,913
General Partner ( 156,356) ( 159,621) ( 161,655) ( 135,914) ( 154,318)
Number of Units
Outstanding 221,484 221,484 221,484 221,484 221,484
-37-
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Use of Forward-Looking Statements and Estimates
This Annual 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 Annual 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, or otherwise indicated.
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 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:
* Worldwide and domestic supplies of oil and natural gas;
* The ability of the members of the Organization of Petroleum Exporting
Countries ("OPEC") to agree upon and maintain oil prices and production
quotas;
-38-
* 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,
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 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 decline in
production experienced on all remaining wells.
Results of Operations
An analysis of the change in net oil and gas operations (oil and gas
sales, less lease operating expenses and production taxes), is presented in the
tables following "Results of Operations" under the heading "Average Sales
Prices, Production
-39-
Volumes, and Average Production Costs." Following is a discussion of each
Partnerships' results of operations for the year ended December 31, 2003 as
compared to the year ended December 31, 2002, and for the year ended December
31, 2002 as compared to the year ended December 31, 2001.
III-A Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales increased $164,209 (4.2%) in 2003 as compared to
2002. Of this increase, approximately $244,000 and $1,247,000, respectively,
were related to increases in the average prices of oil and gas sold. These
increases were partially offset by decreases of approximately $224,000 and
$1,103,000, respectively, related to decreases in volumes of oil and gas sold.
Volumes of oil and gas sold decreased 9,260 barrels and 392,007 Mcf,
respectively, in 2003 as compared to 2002. The decrease in volumes of oil sold
was primarily due to normal declines in production, which decrease was partially
offset by an increase in production during 2003 on one significant well due to
the successful workover of that well during mid 2002. The decrease in volumes of
gas sold was primarily due to (i) positive prior period gas balancing
adjustments on two significant wells during 2002, (ii) a substantial decline in
production during 2003 on one significant well following the workover of that
well during early 2002, and (iii) normal declines in production. The well with a
substantial decline in production is not expected to return to previously high
levels of production. Average oil and gas prices increased to $29.66 per barrel
and $5.23 per Mcf, respectively, in 2003 from $24.24 per barrel and $2.81 per
Mcf, respectively, in 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $78,735 (8.6%) in 2003 as compared to 2002. This
decrease was primarily due to (i) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold, (ii) positive
prior period lease operating expense adjustments on two significant wells during
2002, and (iii) workover expenses incurred on two other significant wells during
2002. As a percentage of oil and gas sales, these expenses decreased to 20.7% in
2003 from 23.6% in 2002. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $366,320 (66.3%) in 2003 as compared to 2002. This decrease was
primarily due to (i) the decreases in volumes of oil and gas sold, (ii) several
wells being fully depleted in 2002 due to the lack of remaining economically
-40-
recoverable reserves, and (iii) upward revisions in the estimates of remaining
oil and gas reserves at December 31, 2003. As a percentage of oil and gas sales,
this expense decreased to 4.6% in 2003 from 14.3% in 2002. 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 $3,208 (1.0%) in 2003 as
compared to 2002. As a percentage of oil and gas sales, these expenses decreased
to 7.8% in 2003 from 8.1% in 2002.
The Limited Partners have received cash distributions through December 31,
2003 totaling $36,559,701 or 138.50% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $1,550,065 (28.6%) in 2002 as compared
to 2001. Of this decrease, approximately (i) $1,339,000 was related to a
decrease in the average price of gas sold and (ii) $693,000 was related to a
decrease in volumes of oil sold. These decreases were partially offset by an
increase of approximately $503,000 related to an increase in volumes of gas
sold. Volumes of oil sold decreased 28,180 barrels, while volumes of gas sold
increased 117,215 Mcf in 2002 as compared to 2001. The decrease in volumes of
oil sold was primarily due to (i) a decline in production on several wells
following the recompletions of those wells during mid 2001 and (ii) normal
declines in production. These decreases were partially offset by an increase in
production on one significant well due to the successful workover of that well
during mid 2002. The increase in volumes of gas sold was primarily due to (i) an
increase in production on one significant well due to the successful workover of
that well during early 2002 and (ii) positive prior period gas balancing
adjustments on two significant wells during 2002. These increases were partially
offset by a decline in production on two significant wells following the
recompletions of those wells during mid 2001. Average oil and gas prices
decreased to $24.24 per barrel and $2.81 per Mcf, respectively, in 2002 from
$24.61 per barrel and $4.29 per Mcf, respectively, in 2001.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $104,838 (10.3%) in 2002 as compared to 2001. This
decrease was primarily due to a decrease in production taxes associated with the
decrease in oil and gas sales. This decrease was partially offset by (i)
positive prior period lease operating expense adjustments on two significant
wells during 2002, (ii) an increase in workover expenses incurred on one
significant well during 2002 as compared to 2001, and (iii) workover expenses
incurred on another
-41-
significant well during 2002. As a percentage of oil and gas sales, these
expenses increased to 23.6% in 2002 from 18.8% in 2001. This percentage increase
was primarily due to the decreases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $33,323 (6.4%) in 2002 as compared to 2001. This increase was
primarily due to (i) an increase in depletable oil and gas properties primarily
due to drilling activities on several wells during 2002 and (ii) downward
revisions in the estimates of remaining oil reserves at December 31, 2002. These
increases were partially offset by (i) two significant wells being fully
depleted in 2001 due to the lack of remaining economically recoverable reserves
and (ii) upward revisions in the estimates of remaining gas reserves at December
31, 2002. As a percentage of oil and gas sales, this expense increased to 14.3%
in 2002 from 9.6% in 2001. This percentage increase was primarily due to the
decreases in the average prices of oil and gas sold.
General and administrative expenses increased $3,782 (1.2%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 8.1% in 2002 from 5.7% in 2001. This percentage increase was primarily due to
the decrease in oil and gas sales.
III-B Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales decreased $68,599 (3.0%) in 2003 as compared to
2002. Of this decrease, approximately $189,000 and $661,000, respectively, were
related to decreases in volumes of oil and gas sold. These decreases were
partially offset by increases of approximately $170,000 and $611,000,
respectively, related to increases in the average prices of oil and gas sold.
Volumes of oil and gas sold decreased 7,767 barrels and 242,304 Mcf,
respectively, in 2003 as compared to 2002. The decrease in volumes of oil sold
was primarily due to normal declines in production, which decrease was partially
offset by an increase in production during 2003 on one significant well due to
the successful workover of that well during mid 2002. The decrease in volumes of
gas sold was primarily due to (i) positive prior period gas balancing
adjustments on two significant wells during 2002, (ii) a substantial decline in
production during 2003 on one significant well following the workover of that
well during early 2002, and (iii) normal declines in production. The well with a
substantial decline in production is not expected to return to its previously
high levels of production. Average oil and gas
-42-
prices increased to $29.78 per barrel and $5.24 per Mcf, respectively, in 2003
from $24.32 per barrel and $2.73 per Mcf, respectively, in 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $113,705 (18.3%) in 2003 as compared to 2002. This
decrease was primarily due to (i) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold, (ii) positive
prior period lease operating expense adjustments on two significant wells during
2002, and (iii) workover expenses incurred on several wells during 2002. As a
percentage of oil and gas sales, these expenses decreased to 23.1% in 2003 from
27.4% in 2002. This percentage decrease was primarily due to the increases in
the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $210,187 (62.5%) in 2003 as compared to 2002. This decrease was
primarily due to (i) the decreases in volumes of oil and gas sold, (ii) several
wells being fully depleted in 2002 due to the lack of remaining economically
recoverable reserves, and (iii) upward revisions in the estimates of remaining
oil and gas reserves at December 31, 2003. As a percentage of oil and gas sales,
this expense decreased to 5.7% in 2003 from 14.8% in 2002. 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 $2,469 (1.4%) in 2003 as
compared to 2002. As a percentage of oil and gas sales, these expenses increased
to 8.0% in 2003 from 7.6% in 2002.
The Limited Partners have received cash distributions through December 31,
2003 totaling $20,777,353 or 150.19% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $870,302 (27.7%) in 2002 as compared to
2001. Of this decrease, approximately (i) $725,000 was related to a decrease in
the average price of gas sold and (ii) $492,000 was related to a decrease in
volumes of oil sold. These decreases were partially offset by an increase of
approximately $362,000 related to an increase in volumes of gas sold. Volumes of
oil sold decreased 19,923 barrels, while volumes of gas sold increased 85,808
Mcf in 2002 as compared to 2001. The decrease in volumes of oil sold was
primarily due to (i) a decline in production on several wells following the
recompletions of those wells during mid 2001 and (ii) normal declines in
production. These decreases were partially offset by
-43-
an increase in production on one significant well due to the successful workover
of that well during mid 2002. The increase in volumes of gas sold was primarily
due to (i) positive prior period gas balancing adjustments on two significant
wells during 2002 and (ii) an increase in production on one significant well due
to the successful workover of that well during early 2002. These increases were
partially offset by a decline in production on two significant wells following
the recompletions of those wells during mid 2001. Average oil and gas prices
decreased to $24.32 per barrel and $2.73 per Mcf, respectively, in 2002 from
$24.72 per barrel and $4.22 per Mcf, respectively, in 2001.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $7,810 (1.2%) in 2002 as compared to 2001. This
decrease was primarily due to a decrease in production taxes associated with the
decrease in oil and gas sales. This decrease was partially offset by (i)
positive prior period lease operating expense adjustments on two significant
wells during 2002, (ii) an increase in workover expenses incurred on one
significant well in 2002 as compared to 2001, and (iii) workover expenses
incurred on several wells within the same unit during 2002. As a percentage of
oil and gas sales, these expenses increased to 27.4% in 2002 from 20.0% in 2001.
This percentage increase was primarily due to the decreases in the average
prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $22,159 (7.0%) in 2002 as compared to 2001. This increase was
primarily due to (i) an increase in depletable oil and gas properties primarily
due to drilling activities on several wells during 2002 and (ii) downward
revisions in the estimates of remaining oil reserves at December 31, 2002. These
increases were partially offset by (i) two significant wells being fully
depleted in 2001 due to the lack of remaining economically recoverable reserves
and (ii) upward revisions in the estimates of remaining gas reserves at December
31, 2002. As a percentage of oil and gas sales, this expense increased to 14.8%
in 2002 from 10.0% in 2001. This percentage increase was primarily due to the
decreases in the average prices of oil and gas sold.
General and administrative expenses increased $2,365 (1.4%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 7.6% in 2002 from 5.4% in 2001. This percentage increase was primarily due to
the decrease in oil and gas sales.
-44-
III-C Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales increased $860,510 (31.4%) in 2003 as compared to
2002. Of this increase, approximately $1,242,000 was related to an increase in
the average price of gas sold. This increase was partially offset by a decrease
of approximately $436,000 related to a decrease in volumes of gas sold. Volumes
of oil and gas sold decreased 844 barrels and 149,916 Mcf, respectively, in 2003
as compared to 2002. The decrease in volumes of oil sold was primarily due to
the shutting-in of several wells within one unit for the latter portion of 2003
in order to perform workovers on those wells. The operator has not yet
determined when the shut-in wells will return to production. This decrease was
partially offset by an increase in production during 2003 on another significant
well due to the successful recompletion of that well in late 2002. The decrease
in volumes of gas sold was primarily due to (i) normal declines in production
and (ii) the shutting-in of two significant wells during 2003 in order to
perform workovers on those wells. One of the shut-in wells has returned to
production and the operator has not yet determined when the other well will
return to production. These decreases were partially offset by the successful
completion of one significant well in early 2003. Average oil and gas prices
increased to $30.00 per barrel and $4.77 per Mcf, respectively, in 2003 from
$24.53 per barrel and $2.91 per Mcf, respectively, in 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $10,149 (1.2%) in 2003 as compared to 2002. This
increase was primarily due to (i) an increase in production taxes associated
with the increase in oil and gas sales and (ii) workover expenses incurred on
one significant well during 2003. These increases were partially offset by (i) a
decrease in lease operating expenses associated with the decreases in volumes of
oil and gas sold, (ii) workover expenses incurred on several wells during 2002,
and (iii) lower workover expenses incurred on another significant well during
2003 than similar expenses incurred on the same well during 2002. As a
percentage of oil and gas sales, these expenses decreased to 24.1% in 2003 from
31.3% in 2002. This percentage decrease was primarily due to the increases in
the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $73,202 (26.4%) in 2003 as compared to 2002. This decrease was
primarily due to (i) the decreases in volumes of oil and gas sold, (ii) upward
revisions in the estimates of remaining oil and gas reserves at December 31,
2003, and (iii) several wells being fully depleted in 2002 due to the lack of
-45-
remaining economically recoverable reserves. As a percentage of oil and gas
sales, this expense decreased to 5.7% in 2003 from 10.1% in 2002. This
percentage decrease was primarily due to the increases in the average prices of
oil and gas sold.
General and administrative expenses increased $2,917 (1.0%) in 2003 as
compared to 2002. As a percentage of oil and gas sales, these expenses decreased
to 8.1% in 2003 from 10.6% in 2002. This percentage decrease was primarily due
to the increase in oil and gas sales.
The Limited Partners have received cash distributions through December 31,
2003 totaling $27,664,795 or 113.13% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $1,630,227 (37.3%) in 2002 as compared
to 2001. Of this decrease, approximately (i) $1,108,000 was related to a
decrease in the average price of gas sold and (ii) $501,000 was related to a
decrease in volumes of gas sold. Volumes of oil and gas sold decreased 257
barrels and 117,402 Mcf, respectively, in 2002 as compared to 2001. The decrease
in volumes of oil sold was primarily due to (i) the shutting-in of several wells
within one unit for the latter portion of 2002 in order to perform workovers on
those wells and (ii) normal declines in production. These decreases were
partially offset by an increase in production on one significant well due to the
successful recompletion of that well during late 2002. The decrease in volumes
of gas sold was primarily due to (i) normal declines in production and (ii) a
decline in production on one significant well following the unsuccessful
recompletion attempt of that well during late 2001. Average oil and gas prices
decreased to $24.53 per barrel and $2.91 per Mcf, respectively, in 2002 from
$25.53 per barrel and $4.26 per Mcf, respectively, in 2001.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $122,251 (12.5%) in 2002 as compared to 2001. This
decrease was primarily due to (i) a decrease in production taxes associated with
the decrease in oil and gas sales and (ii) a decrease in lease operating
expenses associated with the decreases in volumes of oil and gas sold. These
decreases were partially offset by (i) workover expenses incurred on several
wells within the same unit during 2002 and (ii) workover expenses incurred on
two significant wells during 2002. As a percentage of oil and gas sales, these
expenses increased to 31.3% in 2002 from 22.4% in 2001. This percentage increase
was primarily due to the decreases in the average prices of oil and gas sold.
-46-
Depreciation, depletion, and amortization of oil and gas properties
decreased $93,631 (25.2%) in 2002 as compared to 2001. This decrease was
primarily due to (i) two significant wells being fully depleted in 2001 due to
the lack of remaining economically recoverable reserves, (ii) the decreases in
volumes of oil and gas sold, and (iii) upward revisions in the estimates of
remaining oil and gas reserves at December 31, 2002. These decreases were
partially offset by an increase in depletable oil and gas properties primarily
due to drilling activities on several wells during 2002. As a percentage of oil
and gas sales, this expense increased to 10.1% in 2002 from 8.5% in 2001. This
percentage increase was primarily due to the decreases in the average prices of
oil and gas sold.
General and administrative expenses increased $3,444 (1.2%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 10.6% in 2002 from 6.6% in 2001. This percentage increase was primarily due
to the decrease in oil and gas sales.
III-D Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales increased $537,064 (27.2%) in 2003 as compared to
2002. Of this increase, approximately $129,000 and $703,000, respectively, were
related to increases in the average prices of oil and gas sold. These increases
were partially offset by a decrease of approximately $321,000 related to a
decrease in volumes of gas sold. Volumes of oil sold increased 1,159 barrels,
while volumes of gas sold decreased 113,910 Mcf, respectively, in 2003 as
compared to 2002. The decrease in volumes of gas sold was primarily due to (i)
normal declines in production and (ii) the shutting-in of two significant wells
during 2003 in order to perform workovers on those wells. One of the shut-in
wells has returned to production and the operator has not yet determined when
the other well will return to production. These decreases were partially offset
by the successful completion of one significant well in early 2003. Average oil
and gas prices increased to $27.18 per barrel and $4.63 per Mcf, respectively,
in 2003 from $22.28 per barrel and $2.82 per Mcf, respectively, in 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $90,149 (10.2%) in 2003 as compared to 2002. This
decrease was primarily due to (i) a decrease in lease operating expenses
associated with the decrease in volumes of gas sold, (ii) workover expenses
incurred on several wells within the same unit during 2002, and (iii) lower
-47-
workover expenses incurred on one significant well during 2003 than similar
expenses incurred on the same well during 2002. These decreases were partially
offset by (i) an increase in production taxes associated with the increase in
oil and gas sales and (ii) workover expenses incurred on another significant
well during 2003. As a percentage of oil and gas sales, these expenses decreased
to 31.5% in 2003 from 44.6% in 2002. This percentage decrease was primarily due
to the increases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $26,853 (18.0%) in 2003 as compared to 2002. This decrease was
primarily due to (i) two significant wells being fully depleted in 2002 due to
the lack of remaining economically recoverable reserves, (ii) the decrease in
volumes of gas sold, and (iii) upward revisions in the estimates of remaining
gas reserves at December 31, 2003. These decreases were partially offset by (i)
an increase in depreciation, depletion, and amortization of approximately $8,000
due to a change in accounting estimate of future plugging and abandonment costs
related to the Jay-Little Escambia Creek Field Unit located in Santa Rosa
County, Florida and (ii) substantial downward revisions in the estimates of
remaining oil and gas reserves on the same unitized property in 2003 as compared
to 2002. As a percentage of oil and gas sales, these expenses decreased to 4.9%
in 2003 from 7.6% in 2002. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
General and administrative expenses increased $2,477 (1.5%) in 2003 as
compared to 2002. As a percentage of oil and gas sales, these expenses decreased
to 6.7% in 2003 from 8.3% in 2002. This percentage decrease was primarily due to
the increase in oil and gas sales.
The Limited Partners have received cash distributions through December 31,
2003 totaling $15,311,669 or 116.88% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $935,645 (32.1%) in 2002 as compared to
2001. Of this decrease, approximately (i) $641,000 was related to a decrease in
the average price of gas sold and (ii) $248,000 was related to a decrease in
volumes of gas sold. Volumes of oil and gas sold decreased 2,291 barrels and
60,408 Mcf, respectively, in 2002 as compared to 2001. The decrease in volumes
of gas sold was primarily due to normal declines in production. Average oil
prices increased to $22.28 per barrel in 2002 from $22.13 per barrel in 2001.
Average gas prices decreased to $2.82 per Mcf in 2002 from $4.10 per Mcf in
2001.
-48-
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $33,749 (3.7%) in 2002 as compared to 2001. This
decrease was primarily due to (i) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold and (ii) a decrease
in production taxes associated with the decrease in oil and gas sales. These
decreases were partially offset by (i) an increase in workover expenses incurred
on several wells within the same unit in 2002 as compared to 2001 and (ii)
workover expenses incurred on two significant wells during 2002. As a percentage
of oil and gas sales, these expenses increased to 44.6% in 2002 from 31.4% in
2001. This percentage increase was primarily due to the decrease in the average
price of gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $23,911 (19.1%) in 2002 as compared to 2001. This increase was
primarily due to two significant wells being fully depleted in 2002 due to the
lack of remaining economically recoverable reserves. This increase was partially
offset by the decreases in volumes of oil and gas sold. As a percentage of oil
and gas sales, this expense increased to 7.6% in 2002 from 4.3% in 2001. This
percentage increase was primarily due to the decrease in the average price of
gas sold.
General and administrative expenses increased $2,128 (1.3%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 8.3% in 2002 from 5.6% in 2001. This percentage increase was primarily due to
the decrease in oil and gas sales.
III-E Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales increased $1,945,216 (36.2%) in 2003 as compared
to 2002. Of this increase, approximately $645,000 and $1,766,000, respectively,
were related to increases in the average prices of oil and gas sold. These
increases were partially offset by a decrease of approximately $367,000 related
to a decrease in volumes of gas sold. Volumes of oil and gas sold decreased
4,587 barrels and 145,995 Mcf, respectively, in 2003 as compared to 2002. The
decrease in volumes of gas sold was primarily due to (i) normal declines in
production and (ii) the shutting-in of one significant well due to production
difficulties during 2003. The operator has not yet determined when the shut-in
well will return to production. Average oil and gas prices increased to $26.33
per barrel and $4.58 per Mcf,
-49-
respectively, in 2003 from $21.34 per barrel and $2.52 per Mcf, respectively, in
2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $376,614 (10.5%) in 2003 as compared to 2002. This
decrease was primarily due to (i) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold and (ii) workover
expenses incurred on several wells within one unit during 2002. These decreases
were partially offset by an increase in production taxes associated with the
increase in oil and gas sales. As a percentage of oil and gas sales, these
expenses decreased to 43.7% in 2003 from 66.5% in 2002. This percentage decrease
was primarily due to the increases in the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $19,213 (4.9%) in 2003 as compared to 2002. This increase was
primarily due to (i) an increase in depreciation, depletion, and amortization of
approximately $63,000 due to a change in accounting estimate of future plugging
and abandonment costs related to the Jay-Little Escambia Creek Field Unit
located in Santa Rosa County, Florida, (ii) substantial downward revisions in
the estimates of remaining oil and gas reserves on the same unitized property in
2003 as compared to 2002, and (iii) another significant well being fully
depleted in 2003 due to the lack of remaining economically recoverable reserves.
These increases were partially offset by (i) two significant wells being fully
depleted in 2002 due to the lack of remaining economically recoverable reserves
and (ii) the decreases in volumes of oil and gas sold. As a percentage of oil
and gas sales, this expense decreased to 5.6% in 2003 from 7.3% in 2002. This
percentage decrease was primarily due to the increases in the average prices of
oil and gas sold.
General and administrative expenses remained relatively constant in 2003
and 2002. As a percentage of oil and gas sales, these expenses decreased to 6.7%
in 2003 from 9.0% in 2002. This percentage decrease was primarily due to the
increase in oil and gas sales.
The Limited Partners have received cash distributions through December 31,
2003 totaling $46,488,016 or 111.14% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $2,862,544 (34.7%) in 2002 as compared
to 2001. Of this decrease, approximately (i) $615,000 and $876,000,
respectively, were related to decreases in volumes of oil and gas sold and (ii)
$1,358,000 was related to a
-50-
decrease in the average price of gas sold. Volumes of oil and gas sold decreased
28,656 barrels and 226,080 Mcf, respectively, in 2002 as compared to 2001. The
decrease in volumes of oil sold was primarily due to normal declines in
production. The decrease in volumes of gas sold was primarily due to (i) normal
declines in production, (ii) production difficulties on one significant well
during 2002 (which have now been remedied), and (iii) the shutting-in of another
significant well during 2002 in order to perform a recompletion scheduled for
the first part of 2003. These decreases were partially offset by the III-E
Partnership receiving a reduced percentage of sales on one significant well in
2001 due to gas balancing. Average oil and gas prices decreased to $21.34 per
barrel and $2.52 per Mcf, respectively, in 2002 from $21.45 per barrel and $3.87
per Mcf, respectively, in 2001. The average gas price in 2002 was lowered by the
payment of refund amounts relating to the R.W. Scott Investments, LLC lawsuit
described in Item 3 of this Annual Report due to the netting of such refunds
against gas sales.
Oil and gas production expenses (including lease operating expenses and
production expenses) increased $63,417 (1.8%) in 2002 as compared to 2001. This
increase was primarily due to an increase in workover expenses incurred on
several wells within several units in 2002 as compared to 2001. This increase
was partially offset by (i) a decrease in production taxes associated with the
decrease in oil and gas sales and (ii) a decrease in lease operating expenses
associated with the decreases in volumes of oil and gas sold. As a percentage of
oil and gas sales, this expense increased to 66.5% in 2002 from 42.6% in 2001.
This percentage increase was primarily due to the decreases in the average
prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
increased $42,757 (12.2%) in 2002 as compared to 2001. This increase was
primarily due to (i) two significant wells being fully depleted in 2002 due to
the lack of remaining economically recoverable reserves and (ii) an increase in
depletable oil and gas properties primarily due to drilling activities in a
large unitized property during 2002. These increases were partially offset by
the decreases in volumes of oil and gas sold. As a percentage of oil and gas
sales, this expense increased to 7.3% in 2002 from 4.3% in 2001. This percentage
increase was primarily due to (i) the decreases in the average prices of oil and
gas sold and (ii) the dollar increase in depreciation, depletion, and
amortization.
General and administrative expenses increased $5,204 (1.1%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 9.0% in 2002 from 5.8% in 2001. This percentage increase was primarily due to
the decrease in oil and gas sales.
-51-
III-F Partnership
-----------------
Year Ended December 31, 2003 Compared
to Year Ended December 31, 2002
-------------------------------------
Total oil and gas sales increased $843,020 (51.5%) in 2003 as compared to
2002. Of this increase, approximately $127,000 and $974,000, respectively, were
related to increases in the average prices of oil and gas sold. These increases
were partially offset by a decrease of approximately $200,000 related to a
decrease in volumes of gas sold. Volumes of oil and gas sold decreased 2,524
barrels and 91,053 Mcf, respectively, in 2003 as compared to 2002. The decrease
in volumes of oil sold was primarily due to (i) normal declines in production,
(ii) the abandonment of one significant well in early 2003 due to severe
mechanical problems, and (iii) the shutting-in of another significant well due
to production difficulties during 2003. The operator has not yet determined when
the shut-in well will return to production. The decrease in volumes of gas sold
was primarily due to (i) normal declines in production and (ii) the shutting-in
of two significant wells during 2003 in order to perform repairs and maintenance
on those wells. Both shut-in wells have returned to production. Average oil and
gas prices increased to $28.93 per barrel and $4.56 per Mcf, respectively, in
2003 from $22.81 per barrel and $2.20 per Mcf, respectively, in 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) increased $151,144 (25.1%) in 2003 as compared to 2002. This
increase was primarily due to (i) an increase in production taxes associated
with the increase in oil and gas sales, (ii) a negative prior period lease
operating expense adjustment made by the operator on one significant well during
2002, and (iii) workover expenses incurred on another significant well during
2003. These increases were partially offset by a decrease in lease operating
expenses associated with the decreases in volumes of oil and gas sold. As a
percentage of oil and gas sales, these expenses decreased to 30.4% in 2003 from
36.9% in 2002. This percentage decrease was primarily due to the increases in
the average prices of oil and gas sold.
Depreciation, depletion, and amortization of oil and gas properties
decreased $57,524 (21.0%) in 2003 as compared to 2002. This decrease was
primarily due to (i) one significant well being fully depleted in 2002 due to
the lack of remaining economically recoverable reserves, (ii) the decreases in
volumes of oil and gas sold, and (iii) upward revisions in the estimates of
remaining oil and gas reserves at December 31, 2003. These decreases were
partially offset by (i) the abandonment of one significant well in 2003 due to
severe mechanical problems and (ii) another significant well being fully
depleted in 2003 due to the lack of remaining economically recoverable reserves.
As a percentage of oil and gas sales, this expense decreased to 8.7%
-52-
in 2003 from 16.7% in 2002. This percentage decrease was primarily due to the
increases in the average prices of oil and gas sold.
General and administrative expenses increased $2,779 (1.0%) in 2003 as
compared to 2002. As a percentage of oil and gas sales, these expenses decreased
to 10.8% in 2003 from 16.2% in 2002. This percentage decrease was primarily due
to the increase in oil and gas sales.
The Limited Partners have received cash distributions through December 31,
2003 totaling $18,386,904 or 83.02% of Limited Partners' capital contributions.
Year Ended December 31, 2002 Compared
to Year Ended December 31, 2001
-------------------------------------
Total oil and gas sales decreased $1,297,542 (44.2%) in 2002 as compared
to 2001. Of this decrease, approximately (i) $679,000 was related to a decrease
in the average price of gas sold and (ii) $442,000 was related to a decrease in
volumes of gas sold. Volumes of oil and gas sold decreased 3,881 barrels and
117,897 Mcf, respectively, in 2002 as compared to 2001. The decrease in volumes
of oil sold was primarily due to the sale of one significant well during early
2001. The decrease in volumes of gas sold was primarily due to (i) normal
declines in production, (ii) the shutting-in of one significant well during 2002
in order to perform a recompletion, and (iii) the shutting-in of another
significant well during 2002 in order to perform a workover. Average oil prices
increased to $22.81 per barrel in 2002 from $22.29 per barrel in 2001. Average
gas prices decreased to $2.20 per Mcf in 2002 from $3.75 per Mcf in 2001. The
average gas price in 2002 was lowered by the payment of refund amounts relating
to the R.W. Scott Investments, LLC lawsuit described in Item 3 of this Annual
Report due to the netting of such refunds against gas sales.
As discussed in Liquidity and Capital Resources below, the III-F
Partnership sold certain oil and gas properties during 2001 and recognized a
$338,452 gain on such sales. No such sales occurred during 2002.
Oil and gas production expenses (including lease operating expenses and
production taxes) decreased $288,135 (32.3%) in 2002 as compared to 2001. This
decrease was primarily due to (i) the sale of one significant well during early
2001, (ii) a decrease in production taxes associated with the decrease in oil
and gas sales, and (iii) workover expenses incurred on two significant wells
during 2001. As a percentage of oil and gas sales, these expenses increased to
36.9% in 2002 from 30.4% in 2001. This percentage increase was primarily due to
the decrease in the average price of gas sold.
-53-
Depreciation, depletion, and amortization of oil and gas properties
increased $11,138 (4.2%) in 2002 as compared to 2001. This increase was
primarily due to an increase in depletable oil and gas properties primarily due
to drilling activities on two significant wells during 2002. This increase was
partially offset by (i) the decreases in volumes of oil and gas sold and (ii)
upward revisions in the estimates of remaining oil and gas reserves at December
31, 2002. As a percentage of oil and gas sales, this expense increased to 16.7%
in 2002 from 8.9% in 2001. This percentage increase was primarily due to the
decrease in the average price of gas sold.
General and administrative expenses increased $3,281 (1.3%) in 2002 as
compared to 2001. As a percentage of oil and gas sales, these expenses increased
to 16.2% in 2002 from 8.9% in 2001. This percentage increase was primarily due
to the decrease in oil and gas sales.
Average Sale Prices, Production Volumes, and Average Production Costs
The following tables are comparisons of annual average oil and gas sales
prices, production volumes, and average production costs (lease operating
expenses and production taxes) per barrel of oil equivalent (one barrel or 6 Mcf
of gas) for 2003, 2002, and 2001.
-54-
2003 Compared to 2002
---------------------
Average Sales Prices
- -----------------------------------------------------------------------------
P/ship 2003 2002 % Change
- ------ ------------------- ----------------- --------------
Oil Gas Oil Gas
($/Bbl) ($/Mcf) ($/Bbl) ($/Mcf) Oil Gas
------- ------- ------- ------- ----- -----
III-A $29.66 $5.23 $24.24 $2.81 22% 86%
III-B 29.78 5.24 24.32 2.73 22% 92%
III-C 30.00 4.77 24.53 2.91 22% 64%
III-D 27.18 4.63 22.28 2.82 22% 64%
III-E 26.33 4.58 21.34 2.52 23% 82%
III-F 28.93 4.56 22.81 2.20 27% 107%
Production Volumes
- -----------------------------------------------------------------------------
P/ship 2003 2002 % Change
- ------ --------------------- ------------------- --------------
Oil Gas Oil Gas Oil Gas
(Bbls) (Mcf) (Bbls) (Mcf) (Bbls) (Mcf)
------- --------- ------- --------- ------ -----
III-A 45,080 516,905 54,340 908,912 (17%) (43%)
III-B 31,275 243,753 39,042 486,057 (20%) (50%)
III-C 13,872 668,059 14,716 817,975 ( 6%) (18%)
III-D 26,438 387,346 25,279 501,256 ( 5%) (23%)
III-E 129,314 854,720 133,901 1,000,715 ( 3%) (15%)
III-F 20,685 412,842 23,209 503,895 (11%) (18%)
Average Production Costs
per Barrel of Oil Equivalent
-----------------------------------
P/ship 2003 2002 % Change
------ ------ ----- --------
III-A $ 6.37 $4.45 43%
III-B 7.08 5.19 36%
III-C 6.93 5.68 22%
III-D 8.69 8.10 7%
III-E 11.77 11.89 ( 1%)
III-F 8.43 5.63 50%
-55-
2002 Compared to 2001
---------------------
Average Sales Prices
- -----------------------------------------------------------------------------
P/ship 2002 2001 % Change
- ------ ------------------- ----------------- --------------
Oil Gas Oil Gas
($/Bbl) ($/Mcf) ($/Bbl) ($/Mcf) Oil Gas
------- ------- ------- ------- ----- -----
III-A $24.24 $2.81 $24.61 $4.29 (2%) (34%)
III-B 24.32 2.73 24.72 4.22 (2%) (35%)
III-C 24.53 2.91 25.53 4.26 (4%) (32%)
III-D 22.28 2.82 22.13 4.10 1% (31%)
III-E 21.34 2.52 21.45 3.87 (1%) (35%)
III-F 22.81 2.20 22.29 3.75 2% (41%)
Production Volumes
- -----------------------------------------------------------------------------
P/ship 2002 2001 % Change
- ------ --------------------- ------------------- --------------
Oil Gas Oil Gas Oil Gas
(Bbls) (Mcf) (Bbls) (Mcf) (Bbls) (Mcf)
------- --------- ------- --------- ------ -----
III-A 54,340 908,912 82,520 791,697 (34%) 15%
III-B 39,042 486,057 58,965 400,249 (34%) 21%
III-C 14,716 817,975 14,973 935,377 ( 2%) (13%)
III-D 25,279 501,256 27,570 561,664 ( 8%) (11%)
III-E 133,901 1,000,715 162,557 1,226,795 (18%) (18%)
III-F 23,209 503,895 27,090 621,792 (14%) (19%)
Average Production Costs
per Barrel of Oil Equivalent
----------------------------------------
P/ship 2002 2001 % Change
------ ----- ----- --------
III-A $4.45 $4.76 ( 7%)
III-B 5.19 5.02 3%
III-C 5.68 5.74 ( 1%)
III-D 8.10 7.55 7%
III-E 11.89 9.57 24%
III-F 5.63 6.82 (17%)
-56-
Liquidity and Capital Resources
Net proceeds from operations less necessary operating capital are
distributed to the Limited Partners on a quarterly basis. See "Item 5. Market
for Units and Related Limited Partner Matters." The net proceeds from production
are not reinvested in productive assets, except to the extent that producing
wells are improved, where methods are employed to permit more efficient recovery
of reserves, or where identified developmental drilling or recompletion
opportunities are pursued, thereby resulting in a positive economic impact.
Assuming 2003 production levels for future years, the Partnerships' proved
reserve quantities at December 31, 2003 would have the following remaining
lives:
Partnership Gas-Years Oil-Years
----------- --------- ---------
III-A 7.8 3.1
III-B 6.9 2.8
III-C 8.0 7.2
III-D 6.8 5.9
III-E 7.7 5.2
III-F 10.9 17.4
These life of reserves estimates are based on the current estimates of remaining
oil and gas reserves. See "Item 2. Properties" for a discussion of these reserve
estimates.
The Partnerships' available capital from the Limited Partners'
subscriptions has been spent on oil and gas properties and there should be no
further material capital resource commitments in the future. The Partnerships
have no debt commitments. Cash for operational purposes will be provided by
current oil and gas production. During 2003, 2002, and 2001 the Partnerships
expended no capital on oil and gas acquisition or exploration activities.
However, during those years the Partnerships expended the following amounts on
oil and gas developmental activities, primarily well recompletions and
developmental drilling:
Partnership 2003 2002 2001
----------- ------- -------- --------
III-A $53,311 $137,214 $314,177
III-B 32,726 63,540 207,751
III-C 21,609 153,761 128,049
III-D 6,141 170,676 58,029
III-E 21,436 486,120 338,130
III-F 16,762 89,261 52,855
While these expenditures may reduce or eliminate cash available for a
particular quarterly cash distribution, the
-57-
General Partner believes that these activities are necessary for the prudent
operation of the properties and maximization of their value to the Partnerships.
The Partnerships sold certain oil and gas properties during 2003, 2002,
and 2001. The sale of the Partnerships' properties was made by the General
Partner after giving due consideration to both the offer price and the General
Partner's estimate of the property's remaining proved reserves and future
operating costs. Net proceeds from the sale of such properties were included in
the calculation of the Partnerships' cash distributions for the quarter
immediately following the Partnerships' receipt of the proceeds. The amount of
such proceeds from the sale of oil and gas properties during 2003, 2002, and
2001, were as follows:
Partnership 2003 2002 2001
----------- -------- ------- --------
III-A $ 1,902 $ - $ 7,352
III-B 984 118 3,105
III-C 34,411 20,018 52,664
III-D 23,232 16,935 7,258
III-E 101,704 - 55,511
III-F 17,010 - 344,043
The General Partner believes that the sale of these properties will be
beneficial to the Partnerships in the long-term since the properties sold
generally had a higher ratio of future operating expenses as compared to
reserves than the properties not sold.
The III-D and III-E Partnerships own a .65% and 4.67% working interest,
respectively, in the Jay-Little Escambia Creek Field Unit located in Santa Rosa
County, Florida. This property is operated by ExxonMobil and consists of several
oil and gas producing wells, several nitrogen gas injection wells (to stimulate
production), and a gas plant. 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 2003 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 has
significantly exceeded the operator's original cost estimates. Recently, the
operator notified the working interest owners that additional costs would be
incurred in order to plug several wells, as well as conduct various well
workovers, compression repairs, and other significant expenses. It is very
likely that significant plugging costs will continue since there are numerous
wells which are not yet plugged. As a result of these costs, cash flow from this
property has been reduced and at times has been negative.
-58-
The Jay-Little Escambia Creek Field Unit is very sensitive to changes in
oil prices and production volumes. To the extent material repairs, drilling, and
plugging activities continue to be conducted, this property's cash flows could
continue to be low or negative despite relatively high oil and gas prices. The
General Partner currently intends to sell the Partnerships' interests in this
property at a large oil and gas auction during 2004. There is, however, no
assurance that the property will be sold. A joint interest audit of ExxonMobil
expenses charged on this property for the period July 2001 through December 2002
resulted in audit exceptions of approximately $17,000 and $120,000,
respectively, for the III-D and III-E Partnerships. ExxonMobil is not required
to respond to these audit exceptions until early June 2004. The General Partner
cannot currently determine what amount, if any, may be recovered as a result of
these audit exceptions.
There can be no assurance as to the amount of the Partnerships' future
cash distributions. The Partnerships' ability to make cash distributions depends
primarily upon the level of available cash flow generated by the Partnerships'
operating activities, which will be affected (either positively or negatively)
by many factors beyond the control of the Partnerships, including the price of
and demand for oil and gas and other market and economic conditions. Even if
prices and costs remain stable, the amount of cash available for distributions
will decline over time (as the volume of production from producing properties
declines) since the Partnerships are not replacing production through
acquisitions of producing properties and drilling. The Partnerships' quantity of
proved reserves has been reduced by the sale of oil and gas properties as
described above; therefore, it is possible that the Partnerships' future cash
distributions will decline as a result of a reduction of the Partnerships'
reserve base.
Pursuant to the terms of the partnership agreements for the Partnerships
(the "Partnership Agreements") the Partnerships were 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 Annual Report, the General Partner has extended the term of
the III-A, III-B, and III-C Partnerships for the third extension period, and the
III-D, III-E, and III-F Partnerships for the second extension period. Therefore,
the Partnerships are currently scheduled to terminate on the dates indicated in
the "Current Termination Date" column of the following chart.
-59-
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 2 September 5, 2004
III-E December 26, 2000 2 December 26, 2004
III-F March 7, 2001 2 March 7, 2005
The General Partner has not determined whether it will further extend the term
of any Partnership.
Off-Balance Sheet Arrangements
The Partnerships do not have any off-balance sheet arrangements.
Contractual Obligations
The Partnerships do not have any contractual obligations of the type which
are required by the SEC to be disclosed in this Annual Report under this
heading.
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 Partners' property screening costs. The acquisition cost
to the Partnership 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 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 units-of-production method. The
Partnerships' calculation of depreciation, depletion, and amortization includes
estimated dismantlement and abandonment costs, net of estimated salvage values.
When complete units of depreciable property are retired or sold, the asset cost
and related accumulated
-60-
depreciation are eliminated with any gain or loss reflected in income. When less
than complete units of depreciable property are retired or sold, the proceeds
are credited to oil and gas properties.
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 all oil and gas
properties within a field exceed 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 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 included in Item 8 of this
Annual Report 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 connection with the Partnerships' overproduced gas
imbalance positions. The rates used in calculating the Deferred Charge and
Accrued Liability are the annual average production cost 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 received for the
volumes at the time the overproduction occurred. These rates also approximate
the prices for which the Partnerships are currently settling similar
liabilities. 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 a negotiated or contractual payment to the
underproduced party.
-61-
New Accounting Pronouncements
Below is a brief description of Financial Accounting Standards ("FAS")
recently issued by the Financial Accounting Standards Board ("FASB") which may
have an impact on the Partnerships' future results of operations and financial
position.
In July 2001, the FASB issued FAS No. 143, "Accounting for Asset
Retirement Obligations", which is effective for fiscal years beginning after
June 15, 2002 (January 1, 2003 for the Partnerships). On January 1, 2003, the
Partnerships adopted FAS No. 143 and recorded an increase in capitalized cost of
oil and gas properties, an increase (decrease) in net income for the cumulative
effect of the change in accounting principle, and an asset retirement obligation
in the following approximate amounts for each Partnership:
Increase
Increase in (decrease) in
Capitalized Net Income for
Cost of Oil the Change in Asset
and Gas Accounting Retirement
Partnership Properties Principle Obligation
- ----------- ------------ -------------- ----------
III-A $109,000 ($ 1,000) $110,000
III-B 76,000 ( 1,000) 77,000
III-C 192,000 2,000 190,000
III-D 109,000 3,000 106,000
III-E 264,000 3,000 261,000
III-F 144,000 4,000 140,000
These amounts differ significantly from the estimates disclosed in the
Annual Report on Form 10-K for the year ended December 31, 2002 due to a
revision of the methodology used in calculating the change in capitalized cost
of oil and gas properties.
The asset retirement obligation is adjusted upwards each quarter in order
to recognize accretion of the time-related discount factor. For the year ended
December 31, 2003, the III-A, III-B, III-C, III-D, III-E, and III-F Partnerships
recognized approximately $5,000, $6,000, $9,000, $14,000, $83,000, and $10,000,
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.
Inflation and Changing Prices
Prices obtained for oil and gas production depend upon numerous factors,
including the extent of domestic and foreign
-62-
production, foreign imports of oil, market demand, domestic and foreign economic
conditions in general, and governmental regulations and tax laws. The general
level of inflation in the economy did not have a material effect on the
operations of the Partnerships in 2003. Oil and gas prices have fluctuated
during recent years and generally have not followed the same pattern as
inflation. See "Item 2. Properties - Oil and Gas Production, Revenue, and Price
History."
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Partnerships do not hold any market risk sensitive instruments.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data are indexed in Item 15
hereof.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
As of the end of the 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.
-63-
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE GENERAL PARTNER
The Partnerships have no directors or executive officers. The following
individuals are directors and executive officers of the General Partner. The
business address of such director and executive officers is Two West Second
Street, Tulsa, Oklahoma 74103.
Name Age Position with Geodyne
---------------- --- --------------------------------
Dennis R. Neill 52 President and Director
Judy K. Fox 53 Secretary
The director will hold office until the next annual meeting of shareholders of
Geodyne or until his successor has been duly elected and qualified. All
executive officers serve at the discretion of the Board of Directors.
Dennis R. Neill joined Samson in 1981, was named Senior Vice President and
Director of Geodyne on March 3, 1993, and was named President of Geodyne and its
subsidiaries on June 30, 1996. Prior to joining Samson, he was associated with a
Tulsa law firm, Conner and Winters, where his principal practice was in the
securities area. He received a Bachelor of Arts degree in political science from
Oklahoma State University and a Juris Doctorate degree from the University of
Texas. Mr. Neill also serves as Senior Vice President of Samson Investment
Company and as President and Director of Samson Properties Incorporated, Samson
Hydrocarbons Company, Dyco Petroleum Corporation, Berry Gas Company, Circle L
Drilling Company, Snyder Exploration Company, and Compression, Inc.
Judy K. Fox joined Samson in 1990 and was named Secretary of Geodyne and
its subsidiaries on June 30, 1996. Prior to joining Samson, she served as Gas
Contract Manager for Ely Energy Company. Ms. Fox is also Secretary of Berry Gas
Company, Circle L Drilling Company, Compression, Inc., Dyco Petroleum
Corporation, Samson Hydrocarbons Company, Snyder Exploration Company, and Samson
Properties Incorporated.
Section 16(a) Beneficial Ownership Reporting Compliance
To the best knowledge of the Partnerships and the General Partner, there
were no officers, directors, or ten percent owners who were delinquent filers
during 2003 of reports required under Section 16 of the Securities Exchange Act
of 1934.
-64-
Audit Committee Financial Expert
The Partnerships are not required by SEC regulations or otherwise to
maintain an audit committee. The board of directors of the General Partner
consists of one person and therefore serves as its audit committee. There is not
an audit committee financial expert, as defined in the SEC regulations, serving
on the General Partner's board of directors.
Code of Ethics
The General Partner has adopted a Code of Ethics which applies to all of
its executive officers, including those persons who perform the functions of
principal executive officer, principal financial officer, and principal
accounting officer. The Partnerships will provide, free of charge, a copy of
this Code of Ethics to any person upon receipt of a written request mailed to
Geodyne Resources, Inc., Investor Services, Samson Plaza, Two West Second
Street, Tulsa, OK 74103. Such requests must include the address to which the
Code of Ethics should be mailed.
ITEM 11. EXECUTIVE COMPENSATION
The General Partner and its affiliates are reimbursed for actual general
and administrative costs and operating costs incurred and attributable to the
conduct of the business affairs and operations of the Partnerships, computed on
a cost basis, determined in accordance with generally accepted accounting
principles. Such reimbursed costs and expenses allocated to the Partnerships
include office rent, secretarial, employee compensation and benefits, travel and
communication costs, fees for professional services, and other items generally
classified as general or administrative expense. When actual costs incurred
benefit other Partnerships and affiliates, the allocation of costs is based on
the relationship of the Partnerships' reserves to the total reserves owned by
all Partnerships and affiliates. The amount of general and administrative
expense allocated to the General Partner and its affiliates which was charged to
each Partnership during 2003, 2002, and 2001, is set forth in the table below.
Although the actual costs incurred by the General Partner and its affiliates
have fluctuated during the three years presented, the amounts charged to the
Partnerships have not fluctuated due to expense limitations imposed by the
Partnership Agreements.
-65-
Partnership 2003 2002 2001
----------- -------- -------- --------
III-A $277,872 $277,872 $277,872
III-B 145,620 145,620 145,620
III-C 257,412 257,412 257,412
III-D 137,904 137,904 137,904
III-E 440,280 440,280 440,280
III-F 233,136 233,136 233,136
None of the officers or directors of the General Partner receive
compensation directly from the Partnerships. The Partnerships reimburse the
General Partner or its affiliates for that portion of such officers' and
directors' salaries and expenses attributable to time devoted by such
individuals to the Partnerships' activities based on the allocation method
described above. The following tables indicate the approximate amount of general
and administrative expense reimbursement attributable to the salaries of the
directors, officers, and employees of the General Partner and its affiliates
during 2003, 2002, and 2001:
-66-
Salary Reimbursements
III-A Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
-----------------------------------
Annual Compensation Awards Payouts
------------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $154,275 - - - - - -
2002 $148,384 - - - - - -
2003 $150,821 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-A Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-A Partnership and no individual's salary or other
compensation reimbursement from the III-A Partnership equals or exceeds
$100,000 per annum.
-67-
Salary Reimbursements
III-B Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
------------------------------------
Annual Compensation Awards Payouts
------------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $80,848 - - - - - -
2002 $77,761 - - - - - -
2003 $79,038 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-B Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-B Partnership and no individual's salary or other
compensation reimbursement from the III-B Partnership equals or exceeds
$100,000 per annum.
-68-
Salary Reimbursements
III-C Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
----------------------------------
Annual Compensation Awards Payouts
------------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $142,915 - - - - - -
2002 $137,458 - - - - - -
2003 $139,716 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-C Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-C Partnership and no individual's salary or other
compensation reimbursement from the III-C Partnership equals or exceeds
$100,000 per annum.
-69-
Salary Reimbursements
III-D Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
-----------------------------------
Annual Compensation Awards Payouts
------------------------------- ------------------------ -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $76,564 - - - - - -
2002 $73,641 - - - - - -
2003 $74,850 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-D Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-D Partnership and no individual's salary or other
compensation reimbursement from the III-D Partnership equals or exceeds
$100,000 per annum.
-70-
Salary Reimbursements
III-E Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
-------------------------------------
Annual Compensation Awards Payouts
------------------------------- ----------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $244,443 - - - - - -
2002 $235,110 - - - - - -
2003 $238,971 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-E Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-E Partnership and no individual's salary or other
compensation reimbursement from the III-E Partnership equals or exceeds
$100,000 per annum.
-71-
Salary Reimbursements
III-F Partnership
-----------------
Three Years Ended December 31, 2003
Long Term Compensation
-----------------------------------
Annual Compensation Awards Payouts
------------------------------- ---------------------- -------
Securi-
Other ties All
Name Annual Restricted Under- Other
and Compen- Stock lying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- --------------- ---- ------- ------- ------- ---------- -------- ------- -------
Dennis R. Neill,
President(1) 2001 - - - - - - -
2002 - - - - - - -
2003 - - - - - - -
All Executive
Officers,
Directors,
and Employees
as a group(2) 2001 $129,437 - - - - - -
2002 $124,495 - - - - - -
2003 $126,539 - - - - - -
- ----------
(1) The general and administrative expenses paid by the III-F Partnership and
attributable to salary reimbursements do not include any salary or other
compensation attributable to Mr. Neill.
(2) No officer or director of Geodyne or its affiliates provides full-time
services to the III-F Partnership and no individual's salary or other
compensation reimbursement from the III-F Partnership equals or exceeds
$100,000 per annum.
-72-
Affiliates of the Partnerships serve as operator of some of the
Partnerships' wells. The General Partner contracts with such affiliates for
services as operator of the wells. As operator, such affiliates are compensated
at rates provided in the operating agreements in effect and charged to all
parties to such agreement. Such compensation may occur both prior and subsequent
to the commencement of commercial marketing of production of oil or gas. The
dollar amount of such compensation paid by the Partnerships to the affiliates is
impossible to quantify as of the date of this Annual Report.
Samson maintains necessary inventories of new and used field equipment.
Samson may have provided some of this equipment for wells in which the
Partnerships have an interest. This equipment was provided at prices or rates
equal to or less than those normally charged in the same or comparable
geographic area by unaffiliated persons or companies dealing at arm's length.
The operators of these wells billed the Partnerships for a portion of such costs
based upon the Partnerships' interest in the well.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table provides information as to the beneficial ownership of
the Units as of March 3, 2004 by (i) each beneficial owner of more than five
percent of the issued and outstanding Units, (ii) the directors and officers of
the General Partner, and (iii) the General Partner and its affiliates. The
address of each of such persons is Samson Plaza, Two West Second Street, Tulsa,
Oklahoma 74103.
Number of Units
Beneficially
Owned (Percent
Beneficial Owner of Outstanding)
- ------------------------------------ ------------------
III-A Partnership:
- -----------------
Samson Resources Company 59,065 (22.4%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 59,065 (22.4%)
-73-
III-B Partnership:
- -----------------
Samson Resources Company 31,182 (22.5%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 31,182 (22.5%)
III-C Partnership:
- -----------------
Samson Resources Company 61,478 (25.1%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 61,478 (25.1%)
III-D Partnership:
- -----------------
Samson Resources Company 36,236 (27.7%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 36,236 (27.7%)
III-E Partnership:
- -----------------
Samson Resources Company 115,568 (27.6%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 115,568 (27.6%)
III-F Partnership:
- -----------------
Samson Resources Company 63,828 (28.8%)
All affiliates, directors,
and officers of the General
Partner as a group and
the General Partner (4 persons) 63,828 (28.8%)
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The General Partner and certain of its affiliates engage in oil and gas
activities independently of the Partnerships which result in conflicts of
interest that cannot be totally eliminated. The allocation of acquisition and
drilling opportunities and the nature of the compensation arrangements between
the Partnerships and the General Partner also create
-74-
potential conflicts of interest. An affiliate of the Partnerships owns some of
the Partnerships' Units and therefore has an identity of interest with other
Limited Partners with respect to the operations of the Partnerships.
In order to attempt to assure limited liability for Limited Partners as
well as an orderly conduct of business, management of the Partnerships is
exercised solely by the General Partner. The Partnership Agreements grant the
General Partner broad discretionary authority with respect to the Partnerships'
participation in drilling prospects and expenditure and control of funds,
including borrowings. These provisions are similar to those contained in
prospectuses and partnership agreements for other public oil and gas
partnerships. Broad discretion as to general management of the Partnerships
involves circumstances where the General Partner has conflicts of interest and
where it must allocate costs and expenses, or opportunities, among the
Partnerships and other competing interests.
The General Partner does not devote all of its time, efforts, and
personnel exclusively to the Partnerships. Furthermore, the Partnerships do not
have any employees, but instead rely on the personnel of Samson. The
Partnerships thus compete with Samson (including other oil and gas partnerships)
for the time and resources of such personnel. Samson devotes such time and
personnel to the management of the Partnerships as are indicated by the
circumstances and as are consistent with the General Partner's fiduciary duties.
Affiliates of the Partnerships are solely responsible for the negotiation,
administration, and enforcement of oil and gas sales agreements covering the
Partnerships' leasehold interests. Because affiliates of the Partnerships who
provide services to the Partnerships have fiduciary or other duties to other
members of Samson, contract amendments and negotiating positions taken by them
in their effort to enforce contracts with purchasers may not necessarily
represent the positions that the Partnerships would take if they were to
administer their own contracts without involvement with other members of Samson.
On the other hand, management believes that the Partnerships' negotiating
strength and contractual positions have been enhanced by virtue of their
affiliation with Samson.
-75-
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees
During 2003 and 2002, each Partnership paid the following audit fees:
2003 2002
------- -------
Year-end audit per engagement letter $19,250 $17,827
1st quarter 10-Q review 750 750
2nd quarter 10-Q review 750 750
3rd quarter 10-Q review 750 750
Audit-Related Fees
During 2003 and 2002 the Partnerships did not pay any audit-related fees
of the type required by the SEC to be disclosed in this Annual Report under this
heading.
Tax Fees
During 2003 and 2002 the Partnerships did not pay any tax compliance, tax
advice, or tax planning fees of the type required by the SEC to be disclosed in
this Annual Report under this heading.
All Other Fees
During 2003 and 2002 the Partnerships did not pay any other fees of the
type required by the SEC to be disclosed in this Annual Report under this
heading.
Audit Approval
The Partnerships do not have audit committee pre-approval policies and
procedures as described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X.
The Partnerships did not receive any services of the type described in Items
9(e)(2) through 9(e)(4) of Schedule 14A.
Audit and Related Fees Paid by Affiliates
The Partnerships' accountants received compensation from other related
partnerships managed by the General Partner and from other entities affiliated
with the General Partner. This compensation is for audit services, tax related
services, and other accounting-related services. The General Partner does not
believe this arrangement creates a conflict of interest or impairs the auditors'
independence.
-76-
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) Financial Statements, Financial Statement Schedules, and Exhibits.
(1) Financial Statements: The following financial statements for the
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
as of December 31, 2003 and 2002 and for each of the three years in
the period ended December 31, 2003 are filed as part of this report:
Report of Independent Auditors
Balance Sheets
Statements of Operations
Statements of Changes in Partners' Capital (Deficit)
Statements of Cash Flows
Notes to Financial Statements
(2) Financial Statement Schedules:
None.
(3) Exhibits:
Exh.
No. Exhibit
- ----- -------
4.1 Agreement of Limited Partnership dated November 17, 1989 for Geodyne
Energy Income Limited Partnership III-A filed as Exhibit 4.1 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.2 Certificate of Limited Partnership dated January 24, 1990 for
Geodyne Energy Income Limited Partnership III-A filed as Exhibit 4.2
to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
-77-
4.3 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.5 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.4 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.8 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.5 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.5 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.6 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.15 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.7 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.22 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.8 Fifth Amendment to Agreement of Limited Partnership dated November
15, 1999 for Geodyne Energy Income Limited Partnership III-A filed
as Exhibit 4.25 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999, filed with the SEC on February 25,
2000, and is hereby incorporated by reference.
4.9 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-A
filed as Exhibit 4.9 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.10 Seventh Amendment to Agreement of Limited Partnership dated November
17, 2003, for the Geodyne Energy Income Limited Partnership III-A.
-78-
4.11 Agreement of Limited Partnership dated January 24, 1990 for Geodyne
Energy Income Limited Partnership III-B filed as Exhibit 4.2 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.12 Certificate of Limited Partnership dated January 24, 1990 for
Geodyne Energy Income Limited Partnership III-B filed as Exhibit
4.11 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.13 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.6 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.14 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.9 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.15 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.16 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.16 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.15 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.17 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.23 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.18 Fifth Amendment to Agreement of Limited Partnership dated December
30, 1999 for Geodyne Energy Income Limited Partnership III-B filed
as Exhibit 4.26 to Registrant's Annual Report on Form 10-K for the
year
-79-
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.19 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-B
filed as Exhibit 4.18 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.20 Seventh Amendment to Agreement of Limited Partnership dated January
22, 2004, for the Geodyne Energy Income Limited Partnership III-B.
4.21 Agreement of Limited Partnership dated February 26, 1990 for Geodyne
Energy Income Limited Partnership III-C filed as Exhibit 4.3 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.22 Certificate of Limited Partnership dated February 26, 1990 for
Geodyne Energy Income Limited Partnership III-C filed as Exhibit
4.20 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.23 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.7 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.24 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.19 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.25 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.17 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.26 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.24 to Registrant's Annual Report on Form 10-K for the year
ended December
-80-
31, 2001, filed with the SEC on February 28, 2002 and is hereby
incorporated by reference.
4.27 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.24 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.28 Fifth Amendment to Agreement of Limited Partnership dated December
30, 1999 for Geodyne Energy Income Limited Partnership III-C filed
as Exhibit 4.27 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999, filed with the SEC on February 25,
2000, and is hereby incorporated by reference.
4.29 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-C
filed as Exhibit 4.27 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.30 Seventh Amendment to Agreement of Limited Partnership dated January
22, 2004, for the Geodyne Energy Income Limited Partnership III-C.
4.31 Agreement of Limited Partnership dated September 5, 1990 for Geodyne
Energy Income Limited Partnership III-D filed as Exhibit 4.4 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
4.32 Certificate of Limited Partnership dated September 5, 1990 for
Geodyne Energy Income Limited Partnership III-D filed as Exhibit
4.29 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.33 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.11 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.34 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.18 to Registrant's Annual Report on Form 10-K for the year
ended December
-81-
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
4.35 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.25 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.36 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.33 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.37 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.32 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.38 Fifth Amendment to Agreement of Limited Partnership dated August 23,
2000 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.39 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.39 Sixth Amendment to Agreement of Limited Partnership dated August 20,
2002 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.36 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2002, filed with the SEC on March 28, 2003,
and is hereby incorporated by reference.
4.40 Agreement of Limited Partnership dated December 26, 1990 for Geodyne
Energy Income Limited Partnership III-E filed as Exhibit 4.5 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
4.41 Certificate of Limited Partnership dated December 26, 2990 for
Geodyne Energy Income Limited Partnership III-E filed as Exhibit
4.37 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.42 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership
-82-
dated February 24, 1993 for Geodyne Energy Income Limited
Partnership III-E filed as Exhibit 4.12 to Registrant's Annual
Report on Form 10-K for the year ended December 31, 2000, filed with
the SEC on March 5, 2001, and is hereby incorporated by reference.
4.43 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.19 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.44 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.26 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.45 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.41 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.46 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-E filed
as Exhibit 4.33 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.47 Fifth Amendment to Agreement of Limited Partnership dated November
15, 2000 for the Geodyne Energy Income Limited Partnership III-E
filed as Exhibit 4.40 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2000, filed with the SEC on March 5,
2001, and is hereby incorporated by reference.
4.48 Sixth Amendment to Agreement of Limited Partnership for Geodyne
Energy Income Limited Partnership III-E dated November 6, 2002,
filed as Exhibit 4.1 to Registrant's Quarterly Report on Form 10-Q
with the SEC on November 14, 2002, and is hereby incorporated by
reference.
4.49 Agreement of Limited Partnership dated March 7, 1991 for Geodyne
Energy Income Limited Partnership III-F filed as Exhibit 4.6 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
-83-
4.50 Certificate of Limited Partnership dated March 7, 1991 for Geodyne
Energy Income Limited Partnership III-F filed as Exhibit 4.45 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2001, filed with the SEC on February 28, 2002 and is hereby
incorporated by reference.
4.51 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.13 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.52 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.20 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.53 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.48 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.54 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.27 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.55 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-F filed
as Exhibit 4.34 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.56 Fifth Amendment to Agreement of Limited Partnership dated February
5, 2001 for the Geodyne Energy Income Limited Partnership III-F
filed as Exhibit 4.41 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2000, filed with the SEC on March 5,
2001, and is hereby incorporated by reference.
4.57 Sixth Amendment to Agreement of Limited Partnership for the Geodyne
Energy Income Limited Partnership III-F dated February 10, 2003,
filed as Exhibit 4.53(a) to Registrant's Annual Report on Form 10-K
for the year
-84-
ended December 31, 2002, filed with the SEC on March 28, 2003, and
is hereby incorporated by reference.
*23.1 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-A.
*23.2 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-B.
*23.3 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-C.
*23.4 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-D.
*23.5 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-E.
*23.6 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-F.
*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 Certification 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.
-85-
*31.9 Certification by Dennis R. Neill required 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.
*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.
All other Exhibits are omitted as inapplicable.
----------
*Filed herewith.
(b) Reports on Form 8-K filed during the fourth quarter of 2003:
-86-
The following Partnerships filed Current Reports of Form 8-K as follows:
Geodyne Energy Income Limited Partnership III-A
Date of Event: November 19, 2003
Date filed with the SEC: November 19, 2003
Items Included: Item 5 - Other Events
Item 7 - Exhibits
-87-
SIGNATURES
Pursuant to the requirements of Sections 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 organized.
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
By: GEODYNE RESOURCES, INC.
General Partner
March 30, 2004
By: //s//Dennis R. Neill
------------------------------
Dennis R. Neill
President
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 on the dates indicated.
By: //s//Dennis R. Neill President and March 30, 2004
------------------- Director (Principal
Dennis R. Neill Executive Officer)
//s//Craig D. Loseke Chief Accounting March 30, 2004
------------------- Officer (Principal
Craig D. Loseke Accounting and
Financial Officer)
//s//Judy K. Fox Secretary March 30, 2004
-------------------
Judy K. Fox
-88-
Item 8: Financial Statements and Supplementary Data
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-A, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-1
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 804,593 $ 718,665
Accounts receivable:
Related party (Note 2) - 888
Oil and gas sales 509,275 617,187
--------- ---------
Total current assets $1,313,868 $1,336,740
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 847,993 867,774
DEFERRED CHARGE 195,649 260,836
--------- ---------
$2,357,510 $2,465,350
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 76,949 $ 86,580
Gas imbalance payable 22,289 27,471
Asset retirement obligation-
current (Note 1) 8,501 -
--------- ---------
Total current liabilities $ 107,739 $ 114,051
LONG-TERM LIABILITIES:
Accrued liability $ 34,046 $ 33,171
Asset retirement obligation
(Note 1) 106,492 -
--------- ---------
Total long-term liabilities $ 140,538 $ 33,171
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 104,097) ($ 87,091)
Limited Partners, issued and
outstanding, 263,976 Units 2,213,330 2,405,219
--------- ---------
Total Partners' capital $2,109,233 $2,318,128
--------- ---------
$2,357,510 $2,465,350
========= =========
The accompanying notes are an integral part of these
financial statements.
F-2
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ------------ ----------
REVENUES:
Oil and gas sales $4,039,307 $3,875,098 $5,425,163
Interest income 5,800 7,489 33,344
Gain (loss) on sale of oil
and gas properties - ( 22,350) 5,635
--------- --------- ---------
$4,045,107 $3,860,237 $5,464,142
COSTS AND EXPENSES:
Lease operating $ 527,306 $ 697,520 $ 597,621
Production tax 309,211 217,732 422,469
Depreciation, deple-
tion, and amorti-
zation of oil and
gas properties 186,388 552,708 519,385
General and
administrative 315,566 312,358 308,576
--------- --------- ---------
$1,338,471 $1,780,318 $1,848,051
--------- --------- ---------
INCOME BEFORE CUMULATIVE
EFFECT OF ACCOUNTING
CHANGE $2,706,636 $2,079,919 $3,616,091
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 673) - -
--------- --------- ---------
NET INCOME $2,705,963 $2,079,919 $3,616,091
========= ========= =========
GENERAL PARTNER - NET
INCOME $ 286,852 $ 256,987 $ 405,019
========= ========= =========
LIMITED PARTNERS - NET
INCOME $2,419,111 $1,822,932 $3,211,072
========= ========= =========
NET INCOME per Unit $ 9.16 $ 6.91 $ 12.16
========= ========= =========
UNITS OUTSTANDING 263,976 263,976 263,976
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-3
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $3,587,215 ($132,196) $3,455,019
Net income 3,211,072 405,019 3,616,091
Cash distributions ( 3,871,000) ( 387,657) ( 4,258,657)
--------- ------- ---------
Balance, Dec. 31, 2001 $2,927,287 ($114,834) $2,812,453
Net income 1,822,932 256,987 2,079,919
Cash distributions ( 2,345,000) ( 229,244) ( 2,574,244)
--------- ------- ---------
Balance, Dec. 31, 2002 $2,405,219 ($ 87,091) $2,318,128
Net income 2,419,111 286,852 2,705,963
Cash distributions ( 2,611,000) ( 303,858) ( 2,914,858)
--------- ------- ---------
Balance, Dec. 31, 2003 $2,213,330 ($104,097) $2,109,233
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-4
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-A
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $2,705,963 $2,079,919 $3,616,091
Adjustments to reconcile
net income to
net cash provided by
operating activities:
Cumulative effect of change
in accounting for asset
retirement obligations 673 - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 186,388 552,708 519,385
(Gain) loss on sale of oil
and gas properties - 22,350 ( 5,635)
(Increase) decrease in
accounts receivable-
related party 10 ( 10) -
(Increase) decrease in
accounts receivable -
oil and gas sales 107,912 ( 59,289) 255,651
Decrease in deferred
charge 65,187 86,737 202
Increase (decrease) in
accounts payable ( 9,631) ( 114,987) 159,063
Decrease in gas
imbalance payable ( 5,182) ( 4,365) ( 2,634)
Increase (decrease) in
accrued liability 875 ( 7,792) ( 12,667)
--------- --------- ---------
Net cash provided by
operating activities $3,052,195 $2,555,271 $4,529,456
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 53,311) ($ 137,214) ($ 314,177)
Proceeds from sale of oil
and gas properties 1,902 - 7,352
--------- --------- ---------
Net cash used by
investing activities ($ 51,409) ($ 137,214) ($ 306,825)
--------- --------- ---------
F-5
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($2,914,858) ($2,574,244) ($4,258,657)
--------- --------- ---------
Net cash used by
financing activities ($2,914,858) ($2,574,244) ($4,258,657)
--------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 85,928 ($ 156,187) ($ 36,026)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 718,665 874,852 910,878
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 804,593 $ 718,665 $ 874,852
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-6
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-B, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-7
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 417,271 $ 397,754
Accounts receivable:
Related party (Note 2) - 586
Oil and gas sales 274,296 346,664
--------- ---------
Total current assets $ 691,567 $ 745,004
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 450,273 461,645
DEFERRED CHARGE 128,417 184,282
--------- ---------
$1,270,257 $1,390,931
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 52,293 $ 57,077
Gas imbalance payable 11,711 12,396
Asset retirement obligation-
current (Note 1) 25,060 -
--------- ---------
Total current liabilities $ 89,064 $ 69,473
LONG-TERM LIABILITIES:
Accrued liability $ 13,746 $ 12,518
Asset retirement obligation
(Note 1) 58,151 -
--------- ---------
Total long-term liabilities $ 71,897 $ 12,518
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 68,928) ($ 48,554)
Limited Partners, issued and
outstanding, 138,336 Units 1,178,224 1,357,494
--------- ---------
Total Partners' capital $1,109,296 $1,308,940
--------- ---------
$1,270,257 $1,390,931
========= =========
The accompanying notes are an integral part of these
financial statements.
F-8
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ---------- ----------
REVENUES:
Oil and gas sales $2,207,562 $2,276,161 $3,146,463
Interest income 2,971 3,923 17,017
Gain (loss) on sale of oil
and gas properties - ( 14,724) 2,391
--------- --------- ---------
$2,210,533 $2,265,360 $3,165,871
COSTS AND EXPENSES:
Lease operating $ 334,283 $ 477,844 $ 380,273
Production tax 174,948 145,092 250,473
Depreciation, deple-
tion, and amorti-
zation of oil and
gas properties 126,318 336,505 314,346
General and
administrative 175,515 173,046 170,681
--------- --------- ---------
$ 811,064 $1,132,487 $1,115,773
--------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT
OF ACCOUNTING CHANGE $1,399,469 $1,132,873 $2,050,098
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 586) - -
--------- --------- ---------
NET INCOME $1,398,883 $1,132,873 $2,050,098
========= ========= =========
GENERAL PARTNER - NET
INCOME $ 227,153 $ 216,453 $ 348,971
========= ========= =========
LIMITED PARTNERS - NET
INCOME $1,171,730 $ 916,420 $1,701,127
========= ========= =========
NET INCOME per Unit $ 8.47 $ 6.62 $ 12.30
========= ========= =========
UNITS OUTSTANDING 138,336 138,336 138,336
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-9
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $2,037,947 ($ 38,756) $1,999,191
Net income 1,701,127 348,971 2,050,098
Cash distributions ( 1,998,000) ( 377,491) ( 2,375,491)
--------- ------- ---------
Balance, Dec. 31, 2001 $1,741,074 ($ 67,276) $1,673,798
Net income 916,420 216,453 1,132,873
Cash distributions ( 1,300,000) ( 197,731) ( 1,497,731)
--------- ------- ---------
Balance, Dec. 31, 2002 $1,357,494 ($ 48,554) $1,308,940
Net income 1,171,730 227,153 1,398,883
Cash distributions ( 1,351,000) ( 247,527) ( 1,598,527)
--------- ------- ---------
Balance, Dec. 31, 2003 $1,178,224 ($ 68,928) $1,109,296
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-10
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-B
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $1,398,883 $1,132,873 $2,050,098
Adjustments to reconcile
net income to
net cash provided by
operating activities:
Cumulative effect of change
in accounting for asset
retirement obligations 586 - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 126,318 336,505 314,346
(Gain) loss on sale of oil
and gas properties - 14,724 ( 2,391)
(Increase) decrease in
accounts receivable-
related party 7 ( 7) -
(Increase) decrease in
accounts receivable -
oil and gas sales 72,368 ( 16,838) 126,715
Decrease in deferred
charge 55,865 71,708 3,301
Increase (decrease) in
accounts payable ( 4,784) ( 66,188) 98,281
Decrease in gas
imbalance payable ( 685) ( 1,929) ( 2,168)
Increase (decrease) in
accrued liability 1,228 ( 6,840) ( 9,722)
--------- --------- ---------
Net cash provided by
operating activities $1,649,786 $1,464,008 $2,578,460
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 32,726) ($ 63,540) ($ 207,751)
Proceeds from sale of oil
and gas properties 984 118 3,105
--------- --------- ---------
Net cash used by
investing activities ($ 31,742) ($ 63,422) ($ 204,646)
--------- --------- ---------
F-11
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($1,598,527) ($1,497,731) ($2,375,491)
--------- --------- ---------
Net cash used by
financing activities ($1,598,527) ($1,497,731) ($2,375,491)
--------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 19,517 ($ 97,145) ($ 1,677)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 397,754 494,899 496,576
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 417,271 $ 397,754 $ 494,899
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-12
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-C, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-13
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 711,441 $ 480,424
Accounts receivable:
Oil and gas sales 446,858 518,374
--------- ---------
Total current assets $1,158,299 $ 998,798
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 1,691,169 1,694,533
DEFERRED CHARGE 53,217 57,867
--------- ---------
$2,902,685 $2,751,198
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 77,907 $ 143,943
Gas imbalance payable 38,187 43,923
Asset retirement obligation-
current (Note 1) 28,206 -
--------- ---------
Total current liabilities $ 144,300 $ 187,866
LONG-TERM LIABILITIES:
Accrued liability $ 202,758 $ 196,167
Asset retirement obligation(Note 1) 166,247 -
--------- ---------
Total long-term liabilities $ 369,005 $ 196,167
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 153,480) ($ 150,636)
Limited Partners, issued and
outstanding, 244,536 Units 2,542,860 2,517,801
--------- ---------
Total Partners' capital $2,389,380 $2,367,165
--------- ---------
$2,902,685 $2,751,198
========= =========
The accompanying notes are an integral part of these
financial statements.
F-14
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
---------- ---------- ----------
REVENUES:
Oil and gas sales $3,601,398 $2,740,888 $4,371,115
Interest income 4,707 4,112 32,045
Gain on sale of oil and
gas properties 16,854 17,501 52,372
--------- --------- ---------
$3,622,959 $2,762,501 $4,455,532
COSTS AND EXPENSES:
Lease operating $ 617,922 $ 664,164 $ 681,586
Production tax 250,353 193,962 298,791
Depreciation, deple-
tion, and amorti-
zation of oil and
gas properties 204,186 277,388 371,019
General and
administrative 293,086 290,169 286,725
--------- --------- ---------
$1,365,547 $1,425,683 $1,638,121
--------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT
OF ACCOUNTING CHANGE $2,257,412 $1,336,818 $2,817,411
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) 2,317 - -
--------- --------- ---------
NET INCOME $2,259,729 $1,336,818 $2,817,411
========= ========= =========
GENERAL PARTNER -
NET INCOME $ 243,670 $ 158,236 $ 163,926
========= ========= =========
LIMITED PARTNERS -
NET INCOME $2,016,059 $1,178,582 $2,653,485
========= ========= =========
NET INCOME per Unit $ 8.24 $ 4.82 $ 10.85
========= ========= =========
UNITS OUTSTANDING 244,536 244,536 244,536
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-15
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $3,854,734 ($152,824) $3,701,910
Net income 2,653,485 163,926 2,817,411
Cash distributions ( 4,001,000) ( 186,597) ( 4,187,597)
--------- ------- ---------
Balance, Dec. 31, 2001 $2,507,219 ($175,495) $2,331,724
Net income 1,178,582 158,236 1,336,818
Cash distributions ( 1,168,000) ( 133,377) ( 1,301,377)
--------- ------- ---------
Balance, Dec. 31, 2002 $2,517,801 ($150,636) $2,367,165
Net income 2,016,059 243,670 2,259,729
Cash distributions ( 1,991,000) ( 246,514) ( 2,237,514)
--------- ------- ---------
Balance, Dec. 31, 2003 $2,542,860 ($153,480) $2,389,380
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-16
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-C
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $2,259,729 $1,336,818 $2,817,411
Adjustments to reconcile
net income to net
cash provided by operating
activities:
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 2,317) - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 204,186 277,388 371,019
Gain on sale of oil and
gas properties ( 16,854) ( 17,501) ( 52,372)
(Increase) decrease in
accounts receivable -
oil and gas sales 71,516 ( 156,240) 529,877
Decrease in deferred
charge 4,650 15,605 16,576
Increase (decrease) in
accounts payable ( 66,036) 57,544 14,668
Increase (decrease) in
gas imbalance payable ( 5,736) 3,199 24,057
Increase in accrued
liability 6,591 27,719 9,490
--------- --------- ---------
Net cash provided by
operating activities $2,455,729 $1,544,532 $3,730,726
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 21,609) ($ 153,761) ($ 128,049)
Proceeds from sale of oil
and gas properties 34,411 20,018 52,664
--------- --------- ---------
Net cash provided (used)
by investing activities $ 12,802 ($ 133,743) ($ 75,385)
--------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($2,237,514) ($1,301,377) ($4,187,597)
--------- --------- ---------
Net cash used by
financing activities ($2,237,514) ($1,301,377) ($4,187,597)
--------- --------- ---------
F-17
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 231,017 $ 109,412 ($ 532,256)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 480,424 371,012 903,268
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 711,441 $ 480,424 $ 371,012
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-18
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-D, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-19
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 438,562 $ 306,024
Accounts receivable:
Oil and gas sales 339,466 386,024
--------- ---------
Total current assets $ 778,028 $ 692,048
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 943,562 755,553
DEFERRED CHARGE 9,952 10,949
--------- ---------
$1,731,542 $1,458,550
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 83,251 $ 171,347
Gas imbalance payable 5,189 -
Asset retirement obligation-
current (Note 1) 7,187 -
--------- ---------
Total current liabilities $ 95,627 $ 171,347
LONG-TERM LIABILITIES:
Accrued liability $ 247,304 $ 251,798
Asset retirement obligation
(Note 1) 306,844 -
--------- ---------
Total long-term liabilities $ 554,148 $ 251,798
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 47,561) ($ 50,949)
Limited Partners, issued and
outstanding, 131,008 Units 1,129,328 1,086,354
--------- ---------
Total Partners' capital $1,081,767 $1,035,405
--------- ---------
$1,731,542 $1,458,550
========= =========
The accompanying notes are an integral part of these
financial statements.
F-20
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
---------- ---------- ----------
REVENUES:
Oil and gas sales $2,513,778 $1,976,714 $2,912,359
Interest income 2,723 1,879 20,356
Gain on sale of oil
and gas properties 10,701 15,250 7,258
--------- --------- ---------
$2,527,202 $1,993,843 $2,939,973
COSTS AND EXPENSES:
Lease operating 612,216 $ 739,840 $ 715,289
Production tax 178,557 141,082 199,382
Depreciation, depletion
and amortization
of oil and gas
properties 122,507 149,360 125,449
General and
administrative 167,388 164,911 162,783
--------- --------- ---------
$1,080,668 $1,195,193 $1,202,903
--------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT
OF ACCOUNTING CHANGE $1,446,534 $ 798,650 $1,737,070
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) 2,875 - -
--------- --------- ---------
NET INCOME $1,449,409 $ 798,650 $1,737,070
========= ========= =========
GENERAL PARTNER - NET
INCOME $ 155,435 $ 93,120 $ 107,057
========= ========= =========
LIMITED PARTNERS - NET
INCOME $1,293,974 $ 705,530 $1,630,013
========= ========= =========
NET INCOME per Unit $ 9.88 $ 5.39 $ 12.44
========= ========= =========
UNITS OUTSTANDING 131,008 131,008 131,008
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-21
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $1,779,811 ($ 58,871) $1,720,940
Net income 1,630,013 107,057 1,737,070
Cash distributions ( 2,537,000) ( 121,142) ( 2,658,142)
--------- ------- ---------
Balance, Dec. 31, 2001 $ 872,824 ($ 72,956) $ 799,868
Net income 705,530 93,120 798,650
Cash distributions ( 492,000) ( 71,113) ( 563,113)
--------- ------- ---------
Balance, Dec. 31, 2002 $1,086,354 ($ 50,949) $1,035,405
Net income 1,293,974 155,435 1,449,409
Cash distributions ( 1,251,000) ( 152,047) ( 1,403,047)
--------- ------- ---------
Balance, Dec. 31, 2003 $1,129,328 ($ 47,561) $1,081,767
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-22
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-D
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ---------- ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $1,449,409 $798,650 $1,737,070
Adjustments to reconcile
net income to net
cash provided by
operating activities:
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 2,875) - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 122,507 149,360 125,449
Gain on sale of oil
and gas properties ( 10,701) ( 15,250) ( 7,258)
(Increase) decrease in
accounts receivable -
oil and gas sales 46,558 ( 135,638) 355,840
Decrease in deferred
charge 997 665 4,241
Increase (decrease) in
accounts payable ( 88,096) 23,479 77,330
Increase (decrease) in
gas imbalance payable 5,189 - ( 3,555)
Increase (decrease) in
accrued liability ( 4,494) 41,604 17,965
--------- ------- ---------
Net cash provided by
operating activities $1,518,494 $862,870 $2,307,082
--------- ------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 6,141) ($170,676) ($ 58,029)
Proceeds from sale of oil
and gas properties 23,232 16,935 7,258
--------- ------- ---------
Net cash provided (used)
by investing activities $ 17,091 ($153,741) ($ 50,771)
--------- ------- ---------
F-23
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($1,403,047) ($563,113) ($2,658,142)
--------- ------- ---------
Net cash used by
financing activities ($1,403,047) ($563,113) ($2,658,142)
--------- ------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 132,538 $146,016 ($ 401,831)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 306,024 160,008 561,839
--------- ------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 438,562 $306,024 $ 160,008
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-24
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-E, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-25
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $1,513,224 $ 801,420
Accounts receivable:
Oil and gas sales 1,087,689 924,827
--------- ---------
Total current assets $2,600,913 $1,726,247
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 4,004,314 2,646,994
DEFERRED CHARGE 49,696 69,176
--------- ---------
$6,654,923 $4,442,417
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 415,194 $ 746,759
Accrued liability-other (Note 1) - 122,289
Gas imbalance payable 2,736 2,736
Asset retirement obligation-
current (Note 1) 12,713 -
--------- ---------
Total current liabilities $ 430,643 $ 871,784
LONG-TERM LIABILITIES:
Accrued liability $ 342,831 $ 328,632
Asset retirement obligation (Note 1) 1,756,150 -
--------- ---------
Total long-term liabilities $2,098,981 $ 328,632
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 177,234) ($ 250,684)
Limited Partners, issued and
outstanding, 418,266 Units 4,302,533 3,492,685
--------- ---------
Total Partners' capital $4,125,299 $3,242,001
--------- ---------
$6,654,923 $4,442,417
========= =========
The accompanying notes are an integral part of these
financial statements.
F-26
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
---------- ---------- ----------
REVENUES:
Oil and gas sales $7,321,216 $5,376,000 $8,238,544
Interest income 5,786 2,779 53,027
Gain on sale of
oil and gas properties 76,301 - 55,511
--------- --------- ---------
$7,403,303 $5,378,779 $8,347,082
COSTS AND EXPENSES:
Lease operating $2,697,234 $3,228,739 $2,974,088
Production tax 500,810 345,919 537,153
Depreciation, depletion
and amortization
of oil and gas
properties 412,149 392,936 350,179
General and
administrative 487,927 484,967 479,763
--------- --------- ---------
$4,098,120 $4,452,561 $4,341,183
--------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT
OF ACCOUNTING CHANGE $3,305,183 $ 926,618 $4,005,899
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) 2,725 - -
--------- --------- ---------
NET INCOME $3,307,908 $ 926,218 $4,005,899
========= ========= =========
GENERAL PARTNER - NET
INCOME $ 367,060 $ 127,708 $ 261,289
========= ========= =========
LIMITED PARTNERS - NET
INCOME $2,940,848 $ 798,510 $3,744,610
========= ========= =========
NET INCOME per Unit $ 7.03 $ 1.91 $ 8.95
========= ========= =========
UNITS OUTSTANDING 418,266 418,266 418,266
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-27
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $5,410,565 ($240,721) $5,169,844
Net income 3,744,610 261,289 4,005,899
Cash distributions ( 6,195,000) ( 307,326) ( 6,502,326)
--------- ------- ---------
Balance, Dec. 31, 2001 $2,960,175 ($286,758) $2,673,417
Net income 798,510 127,708 926,218
Cash distributions ( 266,000) ( 91,634) ( 357,634)
--------- ------- ---------
Balance, Dec. 31, 2002 $3,492,685 ($250,684) $3,242,001
Net income 2,940,848 367,060 3,307,908
Cash distributions ( 2,131,000) ( 293,610) ( 2,424,610)
--------- ------- ---------
Balance, Dec. 31, 2003 $4,302,533 ($177,234) $4,125,299
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-28
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-E
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ------------ ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $3,307,908 $ 926,218 $4,005,899
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 2,725) - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 412,149 392,936 350,179
Gain on sale of oil and
gas properties ( 76,301) - ( 55,511)
Settlement of asset
retirement obligation ( 1,848) - -
(Increase) decrease in
accounts receivable -
oil and gas sales ( 162,862) ( 237,737) 1,128,483
Decrease in deferred
charge 19,480 18,536 41,760
Increase (decrease) in
accounts payable ( 331,565) ( 26,248) 365,120
Increase (decrease) in
accrued liability - other ( 122,289) 122,289 -
Decrease in gas
imbalance payable - ( 2,255) ( 43,455)
Increase (decrease) in
accrued liability 14,199 11,411 ( 195,336)
--------- --------- ---------
Net cash provided by
operating activities $3,056,146 $1,205,150 $5,597,139
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 21,436) ($ 486,120) ($ 338,130)
Proceeds from sale of oil
and gas properties 101,704 - 55,511
--------- --------- ---------
Net cash provided (used)
by investing activities $ 80,268 ($ 486,120) ($ 282,619)
--------- --------- ---------
F-29
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($2,424,610) ($ 357,634) ($6,502,326)
--------- --------- ---------
Net cash used by
financing activities ($2,424,610) ($ 357,634) ($6,502,326)
--------- --------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 711,804 $ 361,396 ($1,187,806)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 801,420 440,024 1,627,830
--------- --------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $1,513,224 $ 801,420 $ 440,024
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-30
REPORT OF INDEPENDENT AUDITORS
TO THE PARTNERS
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
In our opinion, the accompanying balance sheets and the related statements
of operations, changes in partners' capital (deficit) and cash flows present
fairly, in all material respects, the financial position of the Geodyne Energy
Income Limited Partnership III-F, an Oklahoma limited partnership, at December
31, 2003 and 2002, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America,
which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in Note 1 of Notes to Combined Financial Statements under the
heading "New Accounting Pronouncements," effective January 1, 2003 the
Partnerships changed the manner in which they account for asset retirement
obligations.
PricewaterhouseCoopers LLP
Tulsa, Oklahoma
March 24, 2004
F-31
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
Balance Sheets
December 31, 2003 and 2002
ASSETS
------
2003 2002
------------ ------------
CURRENT ASSETS:
Cash and cash equivalents $ 521,918 $ 284,588
Accounts receivable:
Oil and gas sales 352,465 348,300
--------- ---------
Total current assets $ 874,383 $ 632,888
NET OIL AND GAS PROPERTIES,
utilizing the successful
efforts method 1,695,682 1,764,313
DEFERRED CHARGE 22,237 29,946
--------- ---------
$2,592,302 $2,427,147
========= =========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 96,896 $ 118,741
Accrued liability - other
(Note 1) - 102,690
Gas imbalance payable 2,295 2,295
Asset retirement obligation-
current (Note 1) 4,002 -
--------- ---------
Total current liabilities $ 103,193 $ 223,726
LONG-TERM LIABILITIES:
Accrued liability $ 131,768 $ 118,005
Asset retirement obligation(Note 1) 138,975 -
--------- ---------
Total long-term liabilities $ 270,743 $ 118,005
PARTNERS' CAPITAL (DEFICIT):
General Partner ($ 156,356) ($ 159,621)
Limited Partners, issued and
outstanding, 221,484 Units 2,374,722 2,245,037
--------- ---------
Total Partners' capital $2,218,366 $2,085,416
--------- ---------
$2,592,302 $2,427,147
========= =========
The accompanying notes are an integral part of these
financial statements.
F-32
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
Statements of Operations
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
---------- ---------- ----------
REVENUES:
Oil and gas sales $2,479,778 $1,636,758 $2,934,300
Interest income 2,295 1,692 28,508
Gain on sale of oil
and gas properties - - 338,452
--------- --------- ---------
$2,482,073 $1,638,450 $3,301,260
COSTS AND EXPENSES:
Lease operating $ 615,422 $ 518,772 $ 721,343
Production tax 139,080 84,586 170,150
Depreciation, deple-
tion, and amorti-
zation of oil and
gas properties 215,975 273,499 262,361
General and
administrative 267,876 265,097 261,816
--------- --------- ---------
$1,238,353 $1,141,954 $1,415,670
--------- --------- ---------
INCOME BEFORE CUMULATIVE EFFECT
OF ACCOUNTING CHANGE $1,243,720 $ 496,496 $1,885,590
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) 3,712 - -
--------- --------- ---------
NET INCOME $1,247,432 $ 496,496 $1,885,590
========= ========= =========
GENERAL PARTNER - NET
INCOME $ 70,747 $ 35,680 $ 103,349
========= ========= =========
LIMITED PARTNERS - NET
INCOME $1,176,685 $ 460,816 $1,782,241
========= ========= =========
NET INCOME per Unit $ 5.31 $ 2.08 $ 8.05
========= ========= =========
UNITS OUTSTANDING 221,484 221,484 221,484
========= ========= =========
The accompanying notes are an integral part of these
financial statements.
F-33
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
Statements of Partners' Capital (Deficit)
For the Years Ended December 31, 2003, 2002, and 2001
Limited General
Partners Partner Total
------------ ---------- ------------
Balance, Dec. 31, 2000 $3,593,980 ($135,914) $3,458,066
Net income 1,782,241 103,349 1,885,590
Cash distributions ( 3,017,000) ( 129,090) ( 3,146,090)
--------- ------- ---------
Balance, Dec. 31, 2001 $2,359,221 ($161,655) $2,197,566
Net income 460,816 35,680 496,496
Cash distributions ( 575,000) ( 33,646) ( 608,646)
--------- ------- ---------
Balance, Dec. 31, 2002 $2,245,037 ($159,621) $2,085,416
Net income 1,176,685 70,747 1,247,432
Cash distributions ( 1,047,000) ( 67,482) ( 1,114,482)
--------- ------- ---------
Balance, Dec. 31, 2003 $2,374,722 ($156,356) $2,218,366
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-34
GEODYNE ENERGY INCOME LIMITED PARTNERSHIP III-F
Statements of Cash Flows
For the Years Ended December 31, 2003, 2002, and 2001
2003 2002 2001
------------ ---------- ------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $1,247,432 $496,496 $1,885,590
Adjustments to reconcile
net income to net
cash provided by operating
activities:
Cumulative effect of change
in accounting for asset
retirement obligations
(Note 1) ( 3,712) - -
Depreciation, deple-
tion, and amortiza-
tion of oil and gas
properties 215,975 273,499 262,361
Gain on sale of oil and
gas properties - - ( 338,452)
Settlement of asset
retirement obligation ( 903) - -
(Increase) decrease in
accounts receivable -
oil and gas sales ( 4,165) ( 108,479) 427,792
Decrease in deferred
charge 7,709 7,055 15,413
Increase (decrease) in
accounts payable ( 21,845) 59,967 559
Increase (decrease) in
accrued liability - other ( 102,690) 102,690 -
Decrease in gas
imbalance payable - - ( 12,956)
Increase in accrued
liability 13,763 6,834 4,148
--------- ------- ---------
Net cash provided by
operating activities $1,351,564 $838,062 $2,244,455
--------- ------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital expenditures ($ 16,762) ($ 89,261) ($ 52,855)
Proceeds from sale of oil
and gas properties 17,010 - 344,043
--------- ------- ---------
Net cash provided (used)
by investing activities $ 248 ($ 89,261) $ 291,188
--------- ------- ---------
F-35
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions ($1,114,482) ($608,646) ($3,146,090)
--------- ------- ---------
Net cash used by
financing activities ($1,114,482) ($608,646) ($3,146,090)
--------- ------- ---------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ 237,330 $140,155 ($ 610,447)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 284,588 144,433 754,880
--------- ------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 521,918 $284,588 $ 144,433
========= ======= =========
The accompanying notes are an integral part of these
financial statements.
F-36
GEODYNE ENERGY INCOME PROGRAM III LIMITED PARTNERSHIPS
Notes to Financial Statements
For the Years Ended December 31, 2003, 2002, and 2001
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Nature of Operations
The Geodyne Energy Income Limited Partnerships (the "Partnerships") were
formed pursuant to a public offering of depositary units ("Units"). Upon
formation, investors became limited partners (the "Limited Partners") and held
Units issued by each Partnership. Geodyne Resources, Inc. (the "General
Partner") is the general partner of each Partnership. Limited Partner capital
contributions were invested in producing oil and gas properties. The
Partnerships were activated on the following dates with the following Limited
Partner capital contributions.
Limited Partner
Date of 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
Pursuant to the terms of the partnership agreements for the Partnerships
(the "Partnership Agreements") the Partnerships were 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 Annual Report on Form 10-K ("Annual Report"), the General
Partner has extended the term of the III-A, III-B, and III-C Partnerships for
the third extension period and the III-D, III-E, and III-F Partnerships for the
second 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 2 September 5, 2004
III-E December 26, 2000 2 December 26, 2004
III-F March 7, 2001 2 March 7, 2005
F-37
The General Partner has not determined whether it will further extend the
term of any Partnership. Accordingly, the financial statements have not been
presented on a liquidation basis because it is not probable that the
Partnerships will be terminated within the next year.
An affiliate of the General Partner owned the following Units at December
31, 2003:
Number of Percent of
Partnership Units Owned Outstanding
----------- ----------- -----------
III-A 59,015 22.4%
III-B 31,132 22.5%
III-C 61,228 25.0%
III-D 35,986 27.5%
III-E 114,808 27.5%
III-F 63,428 28.6%
The Partnerships' sole business is the development and production of oil
and gas. Substantially all of the Partnerships' gas reserves are being sold
regionally on the "spot market." Due to the highly competitive nature of the
spot market, prices on the spot market are subject to wide seasonal and regional
pricing fluctuations. In addition, such spot market sales are generally short
term in nature and are dependent upon obtaining transportation services provided
by pipelines. The Partnerships' oil is sold at or near the Partnerships' wells
under short-term purchase contracts at prevailing arrangements which are
customary in the oil industry. The prices received for the Partnerships' oil and
gas are subject to influences such as global consumption and supply trends.
Allocation of Costs and Revenues
The terms of each Partnership's Limited Partnership Agreement (the
"Partnership Agreement") allocate costs and income between the Limited Partners
and the General Partner as follows:
F-38
Before Payout (1) After Payout(1)
-------------------- --------------------
General Limited General Limited
Partner Partners Partner Partners
-------- -------- -------- --------
Costs(2)
- ------------------------
Sales commissions, payment
for organization and
offering costs and
management fee 1% 99% - -
Property acquisition
costs 1% 99% 1% 99%
Identified development
drilling 1% 99% 1% 99%
Development drilling(2) 5% 95% 15% 85%
General and administra-
tive costs, direct
administrative costs
and operating costs(2) 5% 95% 15% 85%
Income(2)
- ------------------------
Temporary investments of
Limited Partners'
subscriptions 1% 99% 1% 99%
Income from oil and gas
production(2) 5% 95% 15% 85%
Gain on sale of
producing properties(2) 5% 95% 15% 85%
All other income(2) 5% 95% 15% 85%
- ----------
(1) Payout occurs when total distributions to Limited Partners equal total
original Limited Partner subscriptions.
(2) If at payout the Limited Partners have received distributions at an annual
rate less than 12% of their subscriptions, the percentage of income and
costs allocated to the General Partner will increase to only 10% and the
Limited Partners will be allocated 90%. Thereafter, if the distribution to
Limited Partners reaches an average annual rate of 12% the allocation will
change to 15% to the General Partner and 85% to the Limited Partners.
The Partnerships' payout dates and current general partner/limited partner
sharing ratio of costs and income are shown on the following chart:
F-39
Current
Payout Costs and Income
Partnership Occurred Sharing
----------- ------------- ----------------
III-A 2nd Qtr. 2000 10%/90%
III-B 1st Qtr. 1998 15%/85%
III-C 4th Qtr. 2001 10%/90%
III-D 3rd Qtr. 2001 10%/90%
III-E 3rd Qtr. 2001 10%/90%
III-F Not Paid Out 5%/95%
Basis of Presentation
These financial statements reflect the combined accounts of each
Partnership after the elimination of all inter-partnership transactions and
balances.
Cash and Cash Equivalents
The Partnerships consider all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents. Cash equivalents are
not insured, which cause the Partnerships to be subject to risk.
Credit Risks
Accrued oil and gas sales which are due from a variety of oil and gas
purchasers subject the Partnerships to a concentration of credit risk. Some of
these purchasers are discussed in Note 3 - Major Customers.
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.
F-40
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 units-of-production
method. The Partnerships' calculation of depreciation, depletion, and
amortization includes estimated dismantlement and abandonment costs, net of
estimated salvage values. The depreciation, depletion, and amortization rates,
which include accretion of the asset retirement obligation, per equivalent
barrel of oil produced during the years ended December 31, 2003, 2002, and 2001
were as follows:
Partnership 2003 2002 2001
----------- ----- ----- -----
III-A $1.42 $2.69 $2.42
III-B 1.76 2.80 2.50
III-C 1.63 1.84 2.17
III-D 1.35 1.37 1.04
III-E 1.52 1.31 .95
III-F 2.41 2.55 2.01
When complete units of depreciable property are retired or sold, the asset
cost, related accumulated depreciation, and remaining asset retirement
obligation, are eliminated with any gain or loss reflected in income. When less
than complete units of depreciable property are retired or sold, the proceeds
are credited to oil and gas properties.
The Partnerships evaluate the recoverability of the carrying costs of
their proved oil and gas properties at the field level. If the unamortized costs
of oil and gas properties within a field exceed 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 discounted future cash flows from
the properties. No impairment provisions were recorded by the Partnerships
during the three years ended December 31, 2003. The risk that the Partnerships
will be required to record impairment provisions in the future increases as oil
and gas prices decrease.
Deferred Charge
Deferred Charge represents costs deferred for lease operating expenses
incurred in connection with the Partnerships' underproduced gas imbalance
positions. The rate used in calculating the deferred charge is the average of
the annual production costs per Mcf. At December 31, 2003 and 2002, cumulative
total gas sales volumes for underproduced wells were less than the Partnerships'
pro-rata share of total gas production from these wells by the following
amounts:
F-41
2003 2002
-------------------- --------------------
Partnership Mcf Amount Mcf Amount
----------- ------- -------- ------- --------
III-A 225,065 $195,649 300,053 $260,836
III-B 116,099 128,417 166,605 184,282
III-C 90,520 53,217 98,430 57,867
III-D 9,753 9,952 10,730 10,949
III-E 25,212 49,696 35,095 69,176
III-F 20,128 22,237 27,105 29,946
Accrued Liability - Other
The accrued liability - other at December 31, 2002 for the III-E and III-F
Partnerships represents a charge accrued for the payment of refund amounts to
royalty and overriding royalty interest owners in relation to the R. W. Scott
Investments, LLC v. Samson Resources Company lawsuit.
Accrued Liability
Accrued liability represents charges accrued for lease operating expenses
incurred in connection with the Partnerships' overproduced gas imbalance
positions. The rate used in calculating the accrued liability is the average of
the annual production costs per Mcf. At December 31, 2003 and 2002, cumulative
total gas sales volumes for overproduced wells exceeded the Partnerships'
pro-rata share of total gas production from these wells by the following
amounts:
2003 2002
-------------------- ------------------
Partnership Mcf Amount Mcf Amount
----------- ------- -------- ------- --------
III-A 39,165 $ 34,046 38,158 $ 33,171
III-B 12,428 13,746 11,318 12,518
III-C 318,616 202,758 319,227 196,167
III-D 223,033 247,304 231,192 251,798
III-E 173,929 342,831 166,725 328,632
III-F 114,044 131,768 107,831 118,005
Oil and Gas Sales and Gas Imbalance Payable
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
F-42
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 revenue 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 received for the
volumes at the time the overproduction occurred. This also approximates the
price for which the Partnerships are currently settling this liability. At
December 31, 2003 and 2002 total sales exceeded the Partnerships' share of
estimated total gas reserves as follows:
2003 2002
------------------- -------------------
Partnership Mcf Amount Mcf Amount
----------- ------ ------- ------ -------
III-A 14,859 $22,289 18,314 $27,471
III-B 7,807 11,711 8,264 12,396
III-C 25,458 38,187 29,282 43,923
III-D 3,459 5,189 - -
III-E 1,824 2,736 1,824 2,736
III-F 1,530 2,295 1,530 2,295
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 the current estimates of
total gas reserves for the well or by a negotiated or contractual payment to the
underproduced party.
The Partnerships have not entered into any hedging or derivative contracts
in connection with their production and sale of oil and gas.
General and Administrative Overhead
The General Partner and its affiliates are reimbursed for actual general
and administrative costs incurred and attributable to the conduct of the
business affairs and operations of the Partnerships.
F-43
Use of Estimates in Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. Further, the
deferred charge, the gas imbalance payable, the asset retirement obligations,
and the accrued liability all involve estimates which could materially differ
from the actual amounts ultimately realized or incurred in the near term. Oil
and gas reserves (see Note 4) also involve significant estimates which could
materially differ from the actual amounts ultimately realized.
Income Taxes
Income or loss for income tax purposes is includable in the income tax
returns of the partners. Accordingly, no recognition has been given to income
taxes in these financial statements.
New Accounting Pronouncements
Below is a brief description of Financial Accounting Standards ("FAS")
recently issued by the Financial Accounting Standards Board ("FASB") which may
have an impact on the Partnerships' future results of operations and financial
position.
In July 2001, the FASB issued FAS No. 143, "Accounting for Asset
Retirement Obligations", which is effective for fiscal years beginning after
June 15, 2002 (January 1, 2003 for the Partnerships). On January 1, 2003, the
Partnerships adopted FAS No. 143 and recorded an increase in capitalized cost of
oil and gas properties, an increase (decrease) in net income for the cumulative
effect of the change in accounting principle, and an asset retirement obligation
in the following approximate amounts for each Partnership:
F-44
Increase
Increase in (decrease) in
Capitalized Net Income For
Cost of Oil the Change in Asset
and Gas Accounting Retirement
Partnership Properties Principle Obligation
- ----------- ------------ -------------- ----------
III-A $109,000 ($1,000) $110,000
III-B 76,000 ( 1,000) 77,000
III-C 192,000 2,000 190,000
III-D 109,000 3,000 106,000
III-E 264,000 3,000 261,000
III-F 144,000 4,000 140,000
These amounts differ significantly from the estimates disclosed in the
Annual Report on Form 10-K for the year ended December 31, 2002 due to a
revision of the methodology used in calculating the change in capitalized cost
of oil and gas properties.
The asset retirement obligation is adjusted upwards each quarter in order
to recognize accretion of the time-related discount factor. For the year ended
December 31, 2003, the III-A, III-B, III-C, III-D, III-E, and III-F Partnerships
recognized approximately $5,000, $6,000, $9,000, $14,000, $83,000, and $10,000,
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 year
ended December 31, 2003 are as shown below.
III-A Partnership
-----------------
2003
--------
Total Asset Retirement Obligation, January 1, 2003 $109,762
Additions and Revisions 627
Accretion Expense 4,604
-------
Total Asset Retirement Obligation, December 31, 2003 $114,993
=======
Asset Retirement Obligation - Current $ 8,501
Asset Retirement Obligation - Long-Term 106,492
F-45
III-B Partnership
-----------------
2003
----------
Total Asset Retirement Obligation, January 1, 2003 $ 76,536
Additions and Revisions 198
Accretion Expense 6,477
-------
Total Asset Retirement Obligation, December 31, 2003 $ 83,211
=======
Asset Retirement Obligation - Current $ 25,060
Asset Retirement Obligation - Long-Term 58,151
III-C Partnership
-----------------
2003
----------
Total Asset Retirement Obligation, January 1, 2003 $189,767
Additions and Revisions 230
Settlements and Disposals ( 3,216)
Accretion Expense 7,672
-------
Total Asset Retirement Obligation, December 31, 2003 $194,453
=======
Asset Retirement Obligation - Current $ 28,206
Asset Retirement Obligation - Long-Term 166,247
III-D Partnership
-----------------
2003
----------
Total Asset Retirement Obligation, January 1, 2003 $106,449
Additions and Revisions 203,597
Settlements and Disposals ( 273)
Accretion Expense 4,258
-------
Total Asset Retirement Obligation, December 31, 2003 $314,031
=======
Asset Retirement Obligation - Current $ 7,187
Asset Retirement Obligation - Long-Term 306,844
F-46
III-E Partnership
-----------------
2003
------------
Total Asset Retirement Obligation, January 1, 2003 $ 260,513
Additions and Revisions 1,508,408
Settlements and Disposals ( 4,687)
Accretion Expense 4,629
---------
Total Asset Retirement Obligation, December 31, 2003 $1,768,863
=========
Asset Retirement Obligation - Current $ 12,713
Asset Retirement Obligation - Long-Term 1,756,150
III-F Partnership
-----------------
2003
----------
Total Asset Retirement Obligation, January 1, 2003 $139,563
Settlements and Disposals ( 2,303)
Accretion Expense 5,717
-------
Total Asset Retirement Obligation, December 31, 2003 $142,977
=======
Asset Retirement Obligation - Current $ 4,002
Asset Retirement Obligation - Long-Term 138,975
Had FAS No. 143 been adopted at January 1, 2001 the amount of the asset
retirement obligation at that date and at December 31, 2001 and 2002 would not
have been materially different from the amount recorded at January 1, 2003. If
this accounting policy had been in effect on January 1, 2002 and 2001, the
proforma impact for the Partnerships during the year ended December 31, 2002 and
2001 would have been an increase in depreciation, depletion, and amortization
expense of approximately the following amounts:
2002 2001
------- -------
III-A $ 5,000 $ 8,000
III-B 4,000 5,000
III-C 9,000 11,000
III-D 6,000 6,000
III-E 17,000 19,000
III-F 9,000 9,000
F-47
2. TRANSACTIONS WITH RELATED PARTIES
The Partnerships reimburse the General Partner for the general and
administrative overhead applicable to the Partnerships, based on an allocation
of actual costs incurred by the General Partner. When actual costs incurred
benefit other Partnerships and affiliates, the allocation of costs is based on
the relationship of the Partnerships' reserves to the total reserves owned by
all Partnerships and affiliates. The General Partner believes this allocation
method is reasonable. Although the actual costs incurred by the General Partner
and its affiliates have fluctuated during the three years presented, the amounts
charged to the Partnerships have not fluctuated due to the expense limitations
imposed by the Partnership Agreement. The following is a summary of payments
made to the General Partner or its affiliates by the Partnerships for general
and administrative overhead costs for the years ended December 31, 2003, 2002,
and 2001:
Partnership 2003 2002 2001
----------- -------- -------- --------
III-A $277,872 $277,872 $277,872
III-B 145,620 145,620 145,620
III-C 257,412 257,412 257,412
III-D 137,904 137,904 137,904
III-E 440,280 440,280 440,280
III-F 233,136 233,136 233,136
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 these activities, together with
any compressor rentals, consulting, or other services provided. Such charges are
comparable to third party charges in the area where the wells are located and
are the same as charged to other working interest owners in the wells.
The accounts receivable - related party at December 31, 2002 for the III-A
and III-B Partnerships represents accrued proceeds and interest due from the
General Partner for the sale of certain oil and gas properties during 2002. Such
amounts were collected subsequent to December 31, 2002.
3. MAJOR CUSTOMERS
The following table sets forth purchasers who individually accounted for
ten percent or more of each Partnership's combined oil and gas sales during
2003, 2002, and 2001:
F-48
Partnership Purchaser Percentage
----------- ------------------------ --------------------------
2003 2002 2001
----- ----- -----
III-A Eaglwing Trading, Inc.
("Eaglwing") 27.0% 24.0% -
Valero Industrial Gas
L.P. ("Valero") 23.9% 21.0% 25.2%
Conoco, Inc. - 16.2% 11.4%
El Paso Energy Marketing
Company ("El Paso") - 10.5% 18.3%
Phibro Energy, Inc.
("Phibro") - - 27.9%
III-B Eaglwing 32.0% 26.4% -
Valero 20.3% 16.6% 20.3%
Conoco, Inc. - 18.1% 13.0%
Phibro - - 32.0%
El Paso - - 14.4%
III-C Cinergy Marketing Company
("Cinergy") 23.2% - -
Duke Energy Field
Services, Inc. ("Duke") 19.6% - -
Oneok Field Servings Co.
("ONEOK") 17.7% 14.8% -
El Paso - 44.8% 63.5%
III-D Cinergy 28.1% - -
Eaglwing 23.9% 22.0% 15.2%
ONEOK 15.2% 12.7% -
Duke 14.5% - -
El Paso - 43.1% 66.7%
III-E Eaglwing 36.1% 43.7% 36.3%
Duke 13.7% 12.1% -
El Paso - 14.1% 21.7%
III-F Mountain Gas Resources,
Inc. 19.7% - -
Duke 17.3% 13.9% -
Eaglwing 15.4% 19.9% 11.1%
El Paso - 35.3% 45.8%
In the event of interruption of purchases by one or more of these
significant customers or the cessation or material change in availability of
open access transportation by the Partnerships' pipeline transporters, the
Partnerships may encounter difficulty in marketing their gas and in maintaining
historic sales levels. Alternative purchasers or transporters may not be readily
available.
F-49
4. SUPPLEMENTAL OIL AND GAS INFORMATION
The following supplemental information regarding the oil and gas
activities of the Partnerships is presented pursuant to the disclosure
requirements promulgated by the SEC.
Capitalized Costs
Capitalized costs and accumulated depreciation, depletion, amortization,
and valuation allowance at December 31, 2003 and 2002 were as follows:
III-A Partnership
-----------------
2003 2002
------------- -------------
Proved properties $16,012,281 $15,883,585
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 15,164,288) ( 15,015,811)
---------- ----------
Net oil and gas
properties $ 847,993 $ 867,774
========== ==========
III-B Partnership
-----------------
2003 2002
------------- -------------
Proved properties $ 9,598,596 $ 9,513,764
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 9,148,323) ( 9,052,119)
---------- ----------
Net oil and gas
properties $ 450,273 $ 461,645
========== ==========
F-50
III-C Partnership
-----------------
2003 2002
------------- -------------
Proved properties $17,971,295 $18,236,659
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 16,280,126) ( 16,542,126)
---------- ----------
Net oil and gas
properties $ 1,691,169 $ 1,694,533
========== ==========
III-D Partnership
-----------------
2003 2002
------------- -------------
Proved properties $11,173,482 $10,939,239
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 10,229,920) ( 10,183,686)
---------- ----------
Net oil and gas
properties $ 943,562 $ 755,553
========== ==========
III-E Partnership
-----------------
2003 2002
------------- -------------
Proved properties $33,870,262 $32,607,666
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 29,865,948) ( 29,960,672)
---------- ----------
Net oil and gas
properties $ 4,004,314 $ 2,646,994
========== ==========
F-51
III-F Partnership
-----------------
2003 2002
------------- -------------
Proved properties $13,680,802 $14,034,441
Less accumulated
depreciation,
depletion, amorti-
zation, and valua-
tion allowance ( 11,985,120) ( 12,270,128)
---------- ----------
Net oil and gas
properties $ 1,695,682 $ 1,764,313
========== ==========
Costs Incurred
The Partnerships incurred no costs in connection with oil and gas
acquisition or exploration activities during the years ended December 31, 2003,
2002, and 2001. Costs incurred by the Partnerships in connection with oil and
gas property development activities for the years ended December 31, 2003, 2002,
and 2001 were as follows:
Partnership 2003(1) 2002 2001
----------- ---------- -------- --------
III-A $ 53,311 $137,214 $314,177
III-B 32,726 63,540 207,751
III-C 21,609 153,761 128,049
III-D 209,710 170,676 58,029
III-E 1,529,844 486,120 338,130
III-F 16,762 89,261 52,855
----------------
(1) Excludes the estimated asset retirement costs for the III-A,
III-B, III-C, III-D, III-E, and III-F Partnerships of
approximately $75,000, $51,000, $121,000, $74,000, $200,000,
and $95,000, respectively, recorded as part of the FAS No. 143
implementation.
Quantities of Proved Oil and Gas Reserves - Unaudited
The following tables summarize changes in net quantities of the
Partnerships' proved reserves, all of which are located in the United States of
America, for the periods indicated. The proved reserves at December 31, 2003,
2002, and 2001 were estimated by petroleum engineers employed by affiliates of
the Partnerships. Certain reserve information was reviewed by Ryder
F-52
Scott Company, L.P., an independent petroleum engineering firm. The following
information includes certain gas balancing adjustments which cause the gas
volumes to differ from the reserve reports prepared by the General Partner and
reviewed by Ryder Scott.
III-A Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2000 134,841 4,627,887
Production ( 82,520) ( 791,697)
Sale of minerals in place ( 137) ( 7,596)
Extensions and discoveries 107,611 362,597
Revision of previous
estimates 31,991 ( 169,430)
------- ---------
Proved reserves, Dec. 31, 2001 191,786 4,021,761
Production ( 54,340) ( 908,912)
Sale of minerals in place - ( 63,629)
Extensions and discoveries 3,943 93,874
Revision of previous
estimates ( 80,893) 723,606
------- ---------
Proved reserves, Dec. 31, 2002 60,496 3,866,700
Production ( 45,080) ( 516,905)
Extensions and discoveries 40 7,988
Revision of previous
estimates 123,755 681,695
------- ---------
Proved reserves, Dec. 31, 2003 139,211 4,039,478
======= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 186,601 3,970,473
======= =========
December 31, 2002 55,311 3,815,412
======= =========
December 31, 2003 134,026 3,989,058
======= =========
F-53
III-B Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2000 128,777 2,081,540
Production ( 58,965) ( 400,249)
Sale of minerals in place ( 58) ( 3,203)
Extensions and discoveries 70,945 239,174
Revision of previous
estimates ( 5,797) ( 65,431)
------- ---------
Proved reserves, Dec. 31, 2001 134,902 1,851,831
Production ( 39,042) ( 486,057)
Sale of minerals in place - ( 41,974)
Extensions and discoveries 974 27,991
Revision of previous
estimates ( 50,150) 324,236
------- ---------
Proved reserves, Dec. 31, 2002 46,684 1,676,027
Production ( 31,275) ( 243,753)
Extensions and discoveries 18 3,366
Revision of previous
estimates 72,212 242,200
------- ---------
Proved reserves, Dec. 31, 2003 87,639 1,677,840
======= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 131,480 1,817,998
======= =========
December 31, 2002 43,262 1,642,194
======= =========
December 31, 2003 84,217 1,644,581
======= =========
F-54
III-C Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2000 127,243 5,412,690
Production ( 14,973) ( 935,377)
Sale of minerals in place ( 303) ( 5,635)
Extensions and discoveries 1,758 57,794
Revision of previous
estimates ( 28,572) 602,560
------- ---------
Proved reserves, Dec. 31, 2001 85,153 5,132,032
Production ( 14,716) ( 817,975)
Sale of minerals in place ( 107) ( 13,589)
Extensions and discoveries 26,626 165,353
Revision of previous
estimates 13,960 462,792
------- ---------
Proved reserves, Dec. 31, 2002 110,916 4,928,613
Production ( 13,872) ( 668,059)
Sale of minerals in place ( 19) ( 1,572)
Extensions and discoveries 5 1,400
Revision of previous
estimates 2,689 1,088,723
------- ---------
Proved reserves, Dec. 31, 2003 99,719 5,349,105
======= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 85,153 5,132,032
======= =========
December 31, 2002 110,916 4,928,613
======= =========
December 31, 2003 99,719 5,349,105
======= =========
F-55
III-D Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2000 359,321 2,955,669
Production ( 27,570) ( 561,664)
Sale of minerals in place ( 27) ( 572)
Extensions and discoveries - 164,924
Revision of previous
estimates (134,351) 390,180
------- ---------
Proved reserves, Dec. 31, 2001 197,373 2,948,537
Production ( 25,279) ( 501,256)
Sale of minerals in place ( 90) ( 11,178)
Extensions and discoveries 64,310 111,613
Revision of previous
estimates ( 122) 119,822
------- ---------
Proved reserves, Dec. 31, 2002 236,192 2,667,538
Production ( 26,438) ( 387,346)
Sale of minerals in place ( 54) ( 4,885)
Revision of previous
estimates ( 52,656) 377,307
------- ---------
Proved reserves, Dec. 31, 2003 157,044 2,652,614
======= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 197,373 2,948,537
======= =========
December 31, 2002 236,192 2,667,538
======= =========
December 31, 2003 157,044 2,652,614
======= =========
F-56
III-E Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
----------- ------------
Proved reserves, Dec. 31, 2000 2,216,123 8,951,531
Production ( 162,557) (1,226,795)
Sale of minerals in place ( 1,513) -
Extensions and discoveries 121 1,154,075
Revision of previous
estimates ( 927,113) ( 44,375)
--------- ---------
Proved reserves, Dec. 31, 2001 1,125,061 8,834,436
Production ( 133,901) (1,000,715)
Extensions and discoveries 301,037 138,157
Revision of previous
estimates ( 32,339) ( 717,619)
--------- ---------
Proved reserves, Dec. 31, 2002 1,259,858 7,254,259
Production ( 129,314) ( 854,720)
Sale of minerals in place ( 395) ( 34,850)
Extensions and discoveries 38 2,639
Revision of previous
estimates ( 455,263) 198,619
--------- ---------
Proved reserves, Dec. 31, 2003 674,924 6,565,947
========= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 1,125,061 8,834,436
========= =========
December 31, 2002 1,259,858 7,254,259
========= =========
December 31, 2003 674,924 6,565,947
========= =========
F-57
III-F Partnership
-----------------
Crude Natural
Oil Gas
(Barrels) (Mcf)
--------- -----------
Proved reserves, Dec. 31, 2000 352,584 5,532,849
Production ( 27,090) ( 621,792)
Sale of minerals in place ( 90,178) -
Revision of previous
estimates ( 20,901) ( 295,205)
------- ---------
Proved reserves, Dec. 31, 2001 214,415 4,615,852
Production ( 23,209) ( 503,895)
Extensions and discoveries 649 102,747
Revision of previous
estimates 33,017 449,598
------- ---------
Proved reserves, Dec. 31, 2002 224,872 4,664,302
Production ( 20,685) ( 412,842)
Extensions and discoveries 32 2,261
Revision of previous
estimates 156,069 228,662
------- ---------
Proved reserves, Dec. 31, 2003 360,288 4,482,383
======= =========
PROVED DEVELOPED RESERVES:
December 31, 2001 214,415 4,615,852
======= =========
December 31, 2002 224,872 4,664,302
======= =========
December 31, 2003 360,288 4,482,383
======= =========
F-58
5. QUARTERLY FINANCIAL DATA (Unaudited)
Summarized unaudited quarterly financial data for 2003 and 2002 are as
follows:
III-A Partnership
-----------------
2003
---------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- ---------- ---------- ---------
Total Revenues $1,243,101 $1,051,904 $ 945,570 $804,532
Gross Profit (1) 1,051,081 860,462 728,524 568,523
Net Income 910,872 748,079 613,717 433,295
Limited Partners'
Net Income
Per Unit 3.09 2.54 2.08 1.45
2002
---------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- ---------- ---------- ---------
Total Revenues $ 961,717 $1,029,957 $1,053,534 $815,029
Gross Profit (1) 697,993 800,860 822,812 623,320
Net Income 508,436 656,687 504,747 410,049
Limited Partners'
Net Income
Per Unit 1.70 2.22 1.64 1.35
- ------------------
(1) Total revenues less oil and gas production expenses.
F-59
III-B Partnership
-----------------
2003
-------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
-------- ------- -------- --------
Total Revenues $701,334 $572,233 $511,485 $425,481
Gross Profit (1) 581,555 478,698 388,569 252,480
Net Income 498,480 408,943 324,694 166,766
Limited Partners'
Net Income
Per Unit 3.03 2.49 1.97 .98
2002
--------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
-------- -------- -------- --------
Total Revenues $599,873 $609,771 $605,096 $450,620
Gross Profit (1) 417,495 443,082 455,035 326,812
Net Income 302,642 360,742 266,818 202,671
Limited Partners'
Net Income
Per Unit 1.80 2.17 1.50 1.15
- --------------------
(1) Total revenues less oil and gas production expenses.
F-60
III-C Partnership
-----------------
2003
--------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $1,156,682 $964,974 $757,740 $743,563
Gross Profit (1) 917,916 740,580 598,071 498,117
Net Income 798,685 609,714 477,634 373,696
Limited Partners'
Net Income
Per Unit 2.92 2.23 1.74 1.35
2002
--------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $ 571,778 $733,300 $665,997 $791,426
Gross Profit (1) 351,707 584,708 496,183 471,777
Net Income 199,840 446,770 374,331 315,877
Limited Partners'
Net Income
Per Unit .71 1.62 1.36 1.13
- --------------------
(1) Total revenues less oil and gas production expenses.
F-61
III-D Partnership
-----------------
2003
--------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $858,353 $669,742 $442,252 $556,855
Gross Profit (1) 651,047 464,235 282,124 339,023
Net Income 588,424 385,754 214,210 261,021
Limited Partners'
Net Income
Per Unit 4.03 2.63 1.45 1.77
2002
--------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $409,460 $541,489 $448,489 $594,405
Gross Profit (1) 187,592 374,633 270,279 280,417
Net Income 108,716 306,234 195,340 188,360
Limited Partners'
Net Income
Per Unit .73 2.08 1.32 1.26
- ----------------------
(1) Total revenues less oil and gas production expenses.
F-62
III-E Partnership
-----------------
2003
----------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- ---------- ---------- ----------
Total Revenues $2,087,512 $1,771,954 $1,695,973 $1,847,864
Gross Profit (1) 1,235,597 1,019,363 875,319 1,074,980
Net Income 1,000,637 825,768 650,753 830,750
Limited Partners'
Net Income
Per Unit 2.13 1.76 1.38 1.76
2002
----------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- ---------- ---------- ----------
Total Revenues $1,380,273 $1,519,458 $1,186,347 $1,292,701
Gross Profit (1) 516,725 686,662 337,384 263,350
Net Income 301,031 504,768 104,232 16,187
Limited Partners'
Net Income
Per Unit .63 1.07 .20 .01
- ----------------------------
(1) Total revenues less oil and gas production expenses.
F-63
III-F Partnership
-----------------
2003
----------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $745,823 $640,388 $533,224 $562,638
Gross Profit (1) 546,974 453,186 351,566 375,845
Net Income 370,704 352,442 244,964 279,322
Limited Partners'
Net Income
Per Unit 1.57 1.51 1.04 1.19
2002
----------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
---------- -------- -------- --------
Total Revenues $416,737 $446,767 $371,792 $403,154
Gross Profit (1) 295,349 272,312 224,967 242,464
Net Income 163,326 159,263 88,313 85,594
Limited Partners'
Net Income
Per Unit .69 .68 .36 .35
- -----------------------
(1) Total revenues less oil and gas production expenses.
F-64
INDEX TO EXHIBITS
-----------------
Exh.
No. Exhibit
- ----- -------
4.1 Agreement of Limited Partnership dated November 17, 1989 for Geodyne
Energy Income Limited Partnership III-A filed as Exhibit 4.1 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.2 Certificate of Limited Partnership dated January 24, 1990 for
Geodyne Energy Income Limited Partnership III-A filed as Exhibit 4.2
to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.3 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.5 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.4 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.8 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.5 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.5 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.6 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.15 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.7 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-A filed as
Exhibit 4.22 to Registrant's Annual Report on Form 10-K for the year
ended December
F-65
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.8 Fifth Amendment to Agreement of Limited Partnership dated November
15, 1999 for Geodyne Energy Income Limited Partnership III-A filed
as Exhibit 4.25 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999, filed with the SEC on February 25,
2000, and is hereby incorporated by reference.
4.9 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-A
filed as Exhibit 4.9 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.10 Seventh Amendment to Agreement of Limited Partnership dated November
17, 2003, for the Geodyne Energy Income Limited Partnership III-A.
4.11 Agreement of Limited Partnership dated January 24, 1990 for Geodyne
Energy Income Limited Partnership III-B filed as Exhibit 4.2 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.12 Certificate of Limited Partnership dated January 24, 1990 for
Geodyne Energy Income Limited Partnership III-B filed as Exhibit
4.11 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.13 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.6 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.14 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.9 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.15 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.16 to Registrant's Annual Report on Form 10-K for the year
ended December
F-66
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.16 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.15 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.17 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-B filed as
Exhibit 4.23 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.18 Fifth Amendment to Agreement of Limited Partnership dated December
30, 1999 for Geodyne Energy Income Limited Partnership III-B filed
as Exhibit 4.26 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999, filed with the SEC on February 25,
2000, and is hereby incorporated by reference.
4.19 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-B
filed as Exhibit 4.18 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.20 Seventh Amendment to Agreement of Limited Partnership dated January
22, 2004, for the Geodyne Energy Income Limited Partnership III-B.
4.21 Agreement of Limited Partnership dated February 26, 1990 for Geodyne
Energy Income Limited Partnership III-C filed as Exhibit 4.3 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 1999, filed with the SEC on February 25, 2000, and is hereby
incorporated by reference.
4.22 Certificate of Limited Partnership dated February 26, 1990 for
Geodyne Energy Income Limited Partnership III-C filed as Exhibit
4.20 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.23 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.7 to Registrant's Annual Report on Form 10-K for the year
F-67
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.24 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.19 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.25 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.17 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.26 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.24 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.27 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-C filed as
Exhibit 4.24 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1999, filed with the SEC on February 25, 2000,
and is hereby incorporated by reference.
4.28 Fifth Amendment to Agreement of Limited Partnership dated December
30, 1999 for Geodyne Energy Income Limited Partnership III-C filed
as Exhibit 4.27 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999, filed with the SEC on February 25,
2000, and is hereby incorporated by reference.
4.29 Sixth Amendment to Agreement of Limited Partnership dated November
14, 2001, for the Geodyne Energy Income Limited Partnership III-C
filed as Exhibit 4.27 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2001, filed with the SEC on February 28,
2002 and is hereby incorporated by reference.
*4.30 Seventh Amendment to Agreement of Limited Partnership dated January
22, 2004, for the Geodyne Energy Income Limited Partnership III-C.
4.31 Agreement of Limited Partnership dated September 5, 1990 for Geodyne
Energy Income Limited Partnership III-D filed as Exhibit 4.4 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed
F-68
with the SEC on March 5, 2001, and is hereby incorporated by
reference.
4.32 Certificate of Limited Partnership dated September 5, 1990 for
Geodyne Energy Income Limited Partnership III-D filed as Exhibit
4.29 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.33 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.11 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.34 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.18 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.35 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.25 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.36 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-D filed as
Exhibit 4.33 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.37 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.32 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.38 Fifth Amendment to Agreement of Limited Partnership dated August 23,
2000 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.39 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
F-69
4.39 Sixth Amendment to Agreement of Limited Partnership dated August 20,
2002 for the Geodyne Energy Income Limited Partnership III-D filed
as Exhibit 4.36 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2002, filed with the SEC on March 28, 2003,
and is hereby incorporated by reference.
4.40 Agreement of Limited Partnership dated December 26, 1990 for Geodyne
Energy Income Limited Partnership III-E filed as Exhibit 4.5 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
4.41 Certificate of Limited Partnership dated December 26, 2990 for
Geodyne Energy Income Limited Partnership III-E filed as Exhibit
4.37 to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001, filed with the SEC on February 28, 2002 and is
hereby incorporated by reference.
4.42 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.12 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.43 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.19 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.44 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.26 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.45 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-E filed as
Exhibit 4.41 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.46 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-E filed
as Exhibit 4.33 to Registrant's Annual Report on Form 10-K for the
year
F-70
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.47 Fifth Amendment to Agreement of Limited Partnership dated November
15, 2000 for the Geodyne Energy Income Limited Partnership III-E
filed as Exhibit 4.40 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2000, filed with the SEC on March 5,
2001, and is hereby incorporated by reference.
4.48 Sixth Amendment to Agreement of Limited Partnership for Geodyne
Energy Income Limited Partnership III-E dated November 6, 2002,
filed as Exhibit 4.1 to Registrant's Quarterly Report on Form 10-Q
with the SEC on November 14, 2002, and is hereby incorporated by
reference.
4.49 Agreement of Limited Partnership dated March 7, 1991 for Geodyne
Energy Income Limited Partnership III-F filed as Exhibit 4.6 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2000, filed with the SEC on March 5, 2001, and is hereby
incorporated by reference.
4.50 Certificate of Limited Partnership dated March 7, 1991 for Geodyne
Energy Income Limited Partnership III-F filed as Exhibit 4.45 to
Registrant's Annual Report on Form 10-K for the year ended December
31, 2001, filed with the SEC on February 28, 2002 and is hereby
incorporated by reference.
4.51 First Amendment to Certificate of Limited Partnership and First
Amendment to Agreement of Limited Partnership dated February 24,
1993 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.13 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.52 Second Amendment to Agreement of Limited Partnership dated August 4,
1993 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.20 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2000, filed with the SEC on March 5, 2001, and is
hereby incorporated by reference.
4.53 Second Amendment to Certificate of Limited Partnership dated July 1,
1996 for Geodyne Energy Income Limited Partnership III-F filed as
Exhibit 4.48 to Registrant's Annual Report on Form 10-K for the year
ended December 31, 2001, filed with the SEC on February 28, 2002 and
is hereby incorporated by reference.
4.54 Third Amendment to Agreement of Limited Partnership dated August 31,
1995 for Geodyne Energy Income Limited
F-71
Partnership III-F filed as Exhibit 4.27 to Registrant's Annual
Report on Form 10-K for the year ended December 31, 2000, filed with
the SEC on March 5, 2001, and is hereby incorporated by reference.
4.55 Fourth Amendment to Agreement of Limited Partnership dated July 1,
1996 for the Geodyne Energy Income Limited Partnership III-F filed
as Exhibit 4.34 to Registrant's Annual Report on Form 10-K for the
year ended December 31, 2000, filed with the SEC on March 5, 2001,
and is hereby incorporated by reference.
4.56 Fifth Amendment to Agreement of Limited Partnership dated February
5, 2001 for the Geodyne Energy Income Limited Partnership III-F
filed as Exhibit 4.41 to Registrant's Annual Report on Form 10-K for
the year ended December 31, 2000, filed with the SEC on March 5,
2001, and is hereby incorporated by reference.
4.57 Sixth Amendment to Agreement of Limited Partnership for the Geodyne
Energy Income Limited Partnership III-F dated February 10, 2003,
filed as Exhibit 4.53(a) to Registrant's Annual Report on Form 10-K
for the year ended December 31, 2002, filed with the SEC on March
28, 2003, and is hereby incorporated by reference.
*23.1 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-A.
*23.2 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-B.
*23.3 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-C.
*23.4 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-D.
*23.5 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-E.
*23.6 Consent of Ryder Scott Company, L.P. for Geodyne Energy Income
Limited Partnership III-F.
*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.
F-72
*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 Certification 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. Neill required 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.
*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.
F-73
*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.
All other Exhibits are omitted as inapplicable.
----------
*Filed herewith.
F-74