West Virginia | 26-0208835 | |||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer £ | Accelerated filer £ | |||
Non-accelerated filer £ | Smaller reporting company x | |||
(Do not check if a smaller reporting company) |
PART I – FINANCIAL INFORMATION | ||
Page | ||
Item 1. | Financial Statements | |
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II – OTHER INFORMATION | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 5. | ||
Item 6. | ||
• | availability of future cash flows for investor distributions or funding of development activities; |
• | changes in worldwide production volumes and demand, including economic conditions that might impact demand; |
• | volatility of commodity prices for crude oil, natural gas and NGLs and the risk of an extended period of depressed prices; |
• | the impact of governmental policies and/or regulations, including changes in environmental and other laws, the interpretation and enforcement related to those laws and regulations, liabilities arising thereunder and the costs to comply with those laws and regulations; |
• | declines in the value of this Partnership's crude oil, natural gas and NGLs properties resulting in further impairments; |
• | changes in estimates of proved reserves; |
• | inaccuracy of reserve estimates and expected production rates; |
• | potential for production decline rates from this Partnership's wells being greater than expected; |
• | timing and extent of this Partnership's success in further developing and producing this Partnership's reserves; |
• | the Managing General Partner's ability to secure supplies and services at reasonable prices; |
• | availability of sufficient pipeline, gathering and other transportation facilities and related infrastructure to process and transport this Partnership's production, and the impact of these facilities and regional capacity on the prices this Partnership receives for its production; |
• | timing and receipt of necessary regulatory permits; |
• | risks incidental to the operation of crude oil and natural gas wells; |
• | future cash flows, liquidity and financial condition; |
• | competition within the oil and gas industry; |
• | success of the Managing General Partner in marketing this Partnership's crude oil, natural gas and NGLs; |
• | impact of environmental events, governmental and other third-party responses to such events and the Managing General Partner's ability to insure adequately against such events; |
• | cost of pending or future litigation; |
• | adjustments relating to asset dispositions that may be unfavorable to this Partnership; |
• | the Managing General Partner's ability to retain or attract senior management and key technical employees; and |
• | success of strategic plans, expectations and objectives for future operations of the Managing General Partner. |
March 31, 2016 | December 31, 2015 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 468,285 | $ | 495,945 | |||
Accounts receivable | 126,036 | 122,055 | |||||
Crude oil inventory | 66,501 | 41,058 | |||||
Total current assets | 660,822 | 659,058 | |||||
Crude oil and natural gas properties, successful efforts method, at cost | 3,842,707 | 3,819,467 | |||||
Less: Accumulated depreciation, depletion and amortization | (2,004,581 | ) | (1,889,887 | ) | |||
Crude oil and natural gas properties, net | 1,838,126 | 1,929,580 | |||||
Total Assets | $ | 2,498,948 | $ | 2,588,638 | |||
Liabilities and Partners' Equity | |||||||
Current liabilities: | |||||||
Accounts payable and accrued expenses | $ | 8,653 | $ | 11,117 | |||
Due to Managing General Partner-other, net | 203,435 | 236,289 | |||||
Current portion of asset retirement obligations | 230,000 | 230,000 | |||||
Total current liabilities | 442,088 | 477,406 | |||||
Asset retirement obligations | 2,130,491 | 2,083,683 | |||||
Total Liabilities | 2,572,579 | 2,561,089 | |||||
Commitments and contingent liabilities | |||||||
Partners' equity: | |||||||
Managing General Partner | (5,221,192 | ) | (5,183,755 | ) | |||
Limited Partners - 4,470 units issued and outstanding | 5,147,561 | 5,211,304 | |||||
Total Partners' Equity | (73,631 | ) | 27,549 | ||||
Total Liabilities and Partners' Equity | $ | 2,498,948 | $ | 2,588,638 |
Three Months Ended March 31, | |||||||
2016 | 2015 | ||||||
Revenues: | |||||||
Crude oil, natural gas and NGLs sales | $ | 363,931 | $ | 426,356 | |||
Operating costs and expenses: | |||||||
Crude oil, natural gas and NGLs production costs | 267,693 | 268,665 | |||||
Direct costs - general and administrative | 35,916 | 21,713 | |||||
Depreciation, depletion and amortization | 114,694 | 206,926 | |||||
Accretion of asset retirement obligations | 46,808 | 34,467 | |||||
Total operating costs and expenses | 465,111 | 531,771 | |||||
Net loss | $ | (101,180 | ) | $ | (105,415 | ) | |
Net loss allocated to partners | $ | (101,180 | ) | $ | (105,415 | ) | |
Less: Managing General Partner interest in net loss | (37,437 | ) | (39,004 | ) | |||
Net loss allocated to Investor Partners | $ | (63,743 | ) | $ | (66,411 | ) | |
Net loss per Investor Partner unit | $ | (14 | ) | $ | (15 | ) | |
Investor Partner units outstanding | 4,470 | 4,470 |
Three Months Ended March 31, | |||||||
2016 | 2015 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (101,180 | ) | $ | (105,415 | ) | |
Adjustments to net loss to reconcile to net cash from operating activities: | |||||||
Depreciation, depletion and amortization | 114,694 | 206,926 | |||||
Accretion of asset retirement obligations | 46,808 | 34,467 | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (3,981 | ) | 21,273 | ||||
Crude oil inventory | (25,443 | ) | (9,357 | ) | |||
Accounts payable and accrued expenses | (2,464 | ) | 252 | ||||
Due to Managing General Partner-other, net | (32,854 | ) | (16,691 | ) | |||
Net cash from operating activities | (4,420 | ) | 131,455 | ||||
Cash flows from investing activities: | |||||||
Capital expenditures for crude oil and natural gas properties | (23,240 | ) | (43,146 | ) | |||
Net cash from investing activities | (23,240 | ) | (43,146 | ) | |||
Cash flows from financing activities: | |||||||
Distributions to Partners | — | (220,809 | ) | ||||
Net cash from financing activities | — | (220,809 | ) | ||||
Net change in cash and cash equivalents | (27,660 | ) | (132,500 | ) | |||
Cash and cash equivalents, beginning of period | 495,945 | 628,520 | |||||
Cash and cash equivalents, end of period | $ | 468,285 | $ | 496,020 |
March 31, 2016 | December 31, 2015 | ||||||
Crude oil, natural gas and NGLs sales revenues collected from this Partnership's third-party customers | $ | 86,527 | $ | 123,519 | |||
Other (1) | (289,962 | ) | (359,808 | ) | |||
Due to Managing General Partner-other, net | $ | (203,435 | ) | $ | (236,289 | ) |
(1) | All other unsettled transactions between this Partnership and the Managing General Partner. The majority of these are capital expenditures, operating costs and general and administrative costs that have not been deducted from distributions. |
Three Months Ended March 31, | |||||||
2016 | 2015 | ||||||
Well operations and maintenance | $ | 262,753 | $ | 255,731 | |||
Direct costs - general and administrative | 35,916 | 21,713 | |||||
Cash distributions (1) | — | 84,220 |
(1) | During the three months ended March 31, 2016, this Partnership made no quarterly cash distributions to the Managing General Partner or Investor Partners as declining commodity prices resulted in quarterly cash flow deficits from this Partnership's operations. Cash distributions during the three months ended March 31, 2015 include $2,521 related to cash distributions for Investor Partner units repurchased by PDC. |
Amount | |||
Balance at December 31, 2015 | $ | 2,313,683 | |
Accretion expense | 46,808 | ||
Balance at March 31, 2016 | 2,360,491 | ||
Less current portion | (230,000 | ) | |
Long-term portion | $ | 2,130,491 |
Three months ended March 31, | ||||||||||
2016 | 2015 | Change | ||||||||
Number of gross productive wells (end of period) | 75 | 75 | — | |||||||
Production(1) | ||||||||||
Crude oil (Bbl) | 9,504 | 7,831 | 21 | % | ||||||
Natural gas (Mcf) | 37,493 | 35,514 | 6 | % | ||||||
NGLs (Bbl) | 4,420 | 3,958 | 12 | % | ||||||
Crude oil equivalent (Boe)(2) | 20,173 | 17,708 | 14 | % | ||||||
Average Boe per day | 222 | 197 | 14 | % | ||||||
Crude oil, natural gas and NGLs sales | ||||||||||
Crude oil | $ | 279,138 | $ | 296,960 | (6 | )% | ||||
Natural gas | 53,834 | 80,822 | (33 | )% | ||||||
NGLs | 30,959 | 48,574 | (36 | )% | ||||||
Total crude oil, natural gas and NGLs sales | $ | 363,931 | $ | 426,356 | (15 | )% | ||||
Average selling price | ||||||||||
Crude oil (per Bbl) | $ | 29.37 | $ | 37.92 | (23 | )% | ||||
Natural gas (per Mcf) | 1.44 | 2.28 | (37 | )% | ||||||
NGLs (per Bbl) | 7.00 | 12.27 | (43 | )% | ||||||
Crude oil equivalent (per Boe) | 18.04 | 24.08 | (25 | )% | ||||||
Average cost per Boe | ||||||||||
Crude oil, natural gas and NGLs production cost(3) | $ | 13.27 | $ | 15.17 | (13 | )% | ||||
Depreciation, depletion and amortization | 5.69 | 11.69 | (51 | )% | ||||||
Operating costs and expenses | ||||||||||
Direct costs - general and administrative | $ | 35,916 | $ | 21,713 | 65 | % | ||||
Depreciation, depletion and amortization | 114,694 | 206,926 | (45 | )% | ||||||
Cash distributions | $ | — | $ | 220,809 | (100 | )% |
• | a decrease in amounts due to managing general partner-other, net of $33,000; |
• | an increase in crude oil inventory of $25,000; |
• | a decrease in accounts receivable of $4,000; and |
• | a decrease in accounts payable and accrued expenses of $2,000. |
• | a decrease in cash and cash equivalents of $28,000. |
• | a decrease in crude oil, natural gas and NGLs sales of $62,000; |
• | a decrease in changes in operating assets and liabilities of $60,000; and |
• | an increase in direct costs - general and administrative of $14,000. |
Distributions | ||||||||||||
Three Months Ended March 31, | Managing General Partner | Investor Partners | Total | |||||||||
2016 | $ | — | $ | — | $ | — | ||||||
2015 | 81,699 | 139,110 | 220,809 | |||||||||
Period | Total Number of Units Repurchased | Average Price Paid Per Unit | |||||
January 1-31, 2016 | — | $ | — | ||||
February 1-29, 2016 | 5.45 | 271 | |||||
March 1-31, 2016 | 4.50 | 312 | |||||
Total | 9.95 | $ | 289 |
Incorporated by Reference | ||||||||||||
Exhibit Number | Exhibit Description | Form | SEC File Number | Exhibit | Filing Date | Filed Herewith | ||||||
31.1 | Certification by Chief Executive Officer of PDC Energy, Inc., the Managing General Partner of this Partnership, pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act Rules, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | X | ||||||||||
31.2 | Certification by Chief Financial Officer of PDC Energy, Inc., the Managing General Partner of this Partnership, pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act Rules, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | X | ||||||||||
32.1* | Certifications by Chief Executive Officer and Chief Financial Officer of PDC Energy, Inc., the Managing General Partner of this Partnership, pursuant to Title 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||||||
101.INS | XBRL Instance Document | X | ||||||||||
101.SCH | XBRL Taxonomy Extension Schema Document | X | ||||||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | X | ||||||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | X | ||||||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | X |
By: /s/ Barton R. Brookman | ||
Barton R. Brookman President and Chief Executive Officer of PDC Energy, Inc. | ||
May 13, 2016 |
Signature | Title | Date | |
/s/ Barton R. Brookman | President and Chief Executive Officer | May 13, 2016 | |
Barton R. Brookman | PDC Energy, Inc. Managing General Partner of the Registrant | ||
(principal executive officer) | |||
/s/ Gysle R. Shellum | Chief Financial Officer | May 13, 2016 | |
Gysle R. Shellum | PDC Energy, Inc. Managing General Partner of the Registrant | ||
(principal financial officer) | |||
/s/ R. Scott Meyers | Chief Accounting Officer | May 13, 2016 | |
R. Scott Meyers | PDC Energy, Inc. Managing General Partner of the Registrant | ||
(principal accounting officer) |
1. | I have reviewed this Quarterly Report on Form 10-Q of Rockies Region 2007 Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | May 13, 2016 |
/s/ Barton R. Brookman | |
Barton R. Brookman | |
Chief Executive Officer | |
PDC Energy, Inc. | |
Managing General Partner |
1. | I have reviewed this Quarterly Report on Form 10-Q of Rockies Region 2007 Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | May 13, 2016 |
/s/ Gysle R. Shellum | |
Gysle R. Shellum | |
Chief Financial Officer | |
PDC Energy, Inc. | |
Managing General Partner |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
/s/ Barton R. Brookman | May 13, 2016 | |
Barton R. Brookman | ||
President and Chief Executive Officer | ||
PDC Energy, Inc. | ||
Managing General Partner | ||
/s/ Gysle R. Shellum | May 13, 2016 | |
Gysle R. Shellum | ||
Chief Financial Officer | ||
PDC Energy, Inc. | ||
Managing General Partner |
Document Entity Information Document |
3 Months Ended |
---|---|
Mar. 31, 2016
shares
| |
Entity Information | |
Entity Registrant Name | ROCKIES REGION 2007 LP |
Entity Central Index Key | 0001407805 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Smaller Reporting Company |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2016 |
Document Fiscal Year Focus | 2016 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 0.00 |
Additional General Partnership Units Outstanding | 0 |
Balance Sheet Parentheticals (Parentheticals) - shares |
Mar. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Balance Sheet Parentheticals [Abstract] | ||
Limited Partners' Capital Account, Units Issued | 4,470 | 4,470 |
Limited Partners' Capital Account, Units Outstanding | 4,470 | 4,470 |
Condensed Statements of Operations (Unaudited) Statement - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2016 |
Mar. 31, 2015 |
|
Revenues: | ||
Crude oil, natural gas and NGLs sales | $ 363,931 | $ 426,356 |
Operating costs and expenses: | ||
Crude oil, natural gas and NGLs production costs | 267,693 | 268,665 |
Direct costs - general and administrative | 35,916 | 21,713 |
Depreciation, depletion and amortization | 114,694 | 206,926 |
Accretion of asset retirement obligations | 46,808 | 34,467 |
Total operating costs and expenses | 465,111 | 531,771 |
Net loss | (101,180) | (105,415) |
Net loss allocated to partners | $ (101,180) | $ (105,415) |
Net loss per Investor Partner Unit: | ||
Net loss per Investor Partner unit | $ (14) | $ (15) |
Investor Partner units outstanding | 4,470 | 4,470 |
Managing General Partner | ||
Operating costs and expenses: | ||
Net loss allocated to partners | $ (37,437) | $ (39,004) |
Investor Partners | ||
Operating costs and expenses: | ||
Net loss allocated to partners | $ (63,743) | $ (66,411) |
General and Basis of Presentation |
3 Months Ended |
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Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | General and Basis of Presentation Rockies Region 2007 Limited Partnership (this “Partnership” or the “Registrant”) was organized in 2007 as a limited partnership, in accordance with the laws of the State of West Virginia, for the purpose of engaging in the exploration and development of crude oil and natural gas properties. Business operations commenced upon closing of an offering for the private placement of Partnership units. Upon funding, this Partnership entered into a Drilling and Operating Agreement (“D&O Agreement”) with the Managing General Partner which authorizes PDC to conduct and manage this Partnership's business. In accordance with the terms of the Limited Partnership Agreement (the “Agreement”), the Managing General Partner is authorized to manage all activities of this Partnership and initiates and completes substantially all Partnership transactions. As of March 31, 2016, there were 1,759 Investor Partners in this Partnership. PDC is the designated Managing General Partner of this Partnership and owns a 37% Managing General Partner ownership in this Partnership. According to the terms of the Agreement, revenues, costs and cash distributions of this Partnership are allocated 63% to the Investor Partners, which are shared pro rata based upon the number of units in this Partnership, and 37% to the Managing General Partner. The Managing General Partner may repurchase Investor Partner units under certain circumstances provided by the Agreement, upon request of an individual Investor Partner. Through March 31, 2016, the Managing General Partner had repurchased 139 units of Partnership interest from the Investor Partners at an average price of $2,470 per unit. As of March 31, 2016, the Managing General Partner owned 39.0% of this Partnership, including the repurchased interest. In the Managing General Partner's opinion, the accompanying condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of this Partnership's results for interim periods in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Accordingly, pursuant to such rules and regulations, certain notes and other financial information included in the audited financial statements have been condensed or omitted. The December 31, 2015 condensed balance sheet data was derived from audited statements, but does not include disclosures required by U.S. GAAP. The information presented in this Quarterly Report on Form 10-Q should be read in conjunction with this Partnership's audited financial statements and notes thereto included in this Partnership's 2015 Form 10-K. This Partnership's accounting policies are described in the Notes to Financial Statements in this Partnership's 2015 Form 10-K and updated, as necessary, in this Quarterly Report on Form 10-Q. The results of operations and cash flows for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the full year or any future period. |
Recent Accounting Standards |
3 Months Ended |
---|---|
Mar. 31, 2016 | |
New Accounting Pronouncement or Change in Accounting Principle, Current Period Disclosures [Abstract] | |
Description of New Accounting Pronouncements Adopted [Text Block] | Summary of Significant Accounting Policies Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board ("FASB") and the International Accounting Standards Board issued their converged standard on revenue recognition that provides a single, comprehensive model that entities will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard outlines a five-step approach to apply the underlying principle: (1) identify the contract with the customer, (2) identify the separate performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to separate performance obligations and (5) recognize revenue when (or as) each performance obligation is satisfied. In March 2016, the FASB issued an update to the standard intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations when recognizing revenue. The revenue standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The revenue standard can be adopted under the full retrospective method or simplified transition method. Entities are permitted to adopt the revenue standard early, beginning with annual reporting periods after December 15, 2016. The Managing General Partner of this Partnership is currently evaluating the impact these changes may have on this Partnership's financial statements. In August 2014, the FASB issued a new standard related to the disclosure of uncertainties about an entity's ability to continue as a going concern. The new standard will explicitly require management to assess an entity's ability to continue as a going concern every reporting period and to provide related footnote disclosures in certain circumstances. The new standard will be effective for all entities in the first annual period ending after December 15, 2016, with early adoption permitted. The Managing General Partner of this Partnership is currently evaluating the impact these changes may have on this Partnership's financial statements. |
Transactions with Managing General Partner |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions Disclosure [Text Block] | Transactions with Managing General Partner The Managing General Partner transacts business on behalf of this Partnership under the authority of the D&O Agreement. Revenues and other cash inflows received by the Managing General Partner on behalf of this Partnership are distributed to the partners, net of corresponding operating costs and other cash outflows incurred on behalf of this Partnership. The following table presents transactions with the Managing General Partner reflected in the condensed balance sheets line item “Due to Managing General Partner-other, net,” which remain undistributed or unsettled with this Partnership's investors as of the dates indicated:
The following table presents Partnership transactions with the Managing General Partner for the three months ended March 31, 2016 and 2015. “Well operations and maintenance” is included in the “Crude oil, natural gas and NGLs production costs” line item on the condensed statements of operations.
|
Fair Value Measurements and Disclosures |
3 Months Ended |
---|---|
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | Fair Value Measurements This Partnership's fair value measurements were estimated pursuant to a fair value hierarchy that requires this Partnership to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date, giving the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. In these cases, the lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability, and may affect the valuation of the assets and liabilities and their placement within the fair value hierarchy levels. The carrying value of the financial instruments included in current assets and current liabilities approximate fair value due to the short-term maturities of these instruments. The Managing General Partner utilizes fair value, on a non-recurring basis, to perform impairment testing on this Partnership's crude oil and natural gas properties by comparing net capitalized costs, or carrying value, to estimated undiscounted future net cash flows. If net capitalized costs exceed undiscounted future net cash flows, the measurement of impairment is based on estimated fair value and is measured by the amount by which the net capitalized costs exceed their fair value. |
Commitments and Contingencies |
3 Months Ended |
---|---|
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies Legal Proceedings Neither this Partnership nor PDC, in its capacity as the Managing General Partner of this Partnership, are party to any pending legal proceeding that PDC believes would have a materially adverse effect on this Partnership's business, financial condition, results of operations or liquidity. Environmental Due to the nature of the oil and gas industry, this Partnership is exposed to environmental risks. The Managing General Partner has various policies and procedures in place to prevent environmental contamination and mitigate the risks from environmental contamination. The Managing General Partner conducts periodic reviews to identify changes in this Partnership's environmental risk profile. Liabilities are accrued when environmental remediation efforts are probable and the costs can be reasonably estimated. These liabilities are reduced as remediation efforts are completed or are adjusted as a consequence of subsequent periodic reviews. As of March 31, 2016 and December 31, 2015, this Partnership had accrued environmental remediation liabilities of $700 and $1,600, respectively, which is included in accounts payable and accrued expenses on the condensed balance sheet. The Managing General Partner is not currently aware of any environmental claims existing as of March 31, 2016 which have not been provided for or would otherwise have a material impact on this Partnership's condensed financial statements; however, there can be no assurance that current regulatory requirements will not change or that unknown past non-compliance with environmental laws or other potential sources of liability will not be discovered on this Partnership's properties. In August 2015, the Managing General Partner received a Clean Air Act Section 114 Information Request (the "Information Request") from the United States Environmental Protection Agency ("EPA"). The Information Request seeks, among other things, information related to the design, operation, and maintenance of certain production facilities in the DJ Basin of Colorado. The Information Request focuses on historical operation and design information for 46 production facilities, of which one relates to this Partnership, and asks that the Managing General Partner conduct certain sampling and analyses at the identified 46 facilities. The Managing General Partner responded to the Information Request in January 2016 and has received no response as of the date of this report. The Managing General Partner cannot predict the outcome of this matter at this time. In addition, in December 2015, the Managing General Partner received a Compliance Advisory pursuant to C.R.S. § 25-7-115(2) from the Colorado Department of Public Health and Environment's Air Quality Control Commission's Air Pollution Control Division alleging that the Managing General Partner had failed to design, operate, and maintain certain condensate collection, storage, processing and handling operations to minimize leakage to the maximum extent possible of volatile organic compounds at 65 facilities consistent with applicable standards under Colorado law. Certain of this Partnership's wells were included in this list of 65 facilities. The Managing General Partner is in the process of responding to the advisory, which has overlap with the Information Request, but cannot predict the outcome of this matter at this time. |
Asset Retirement Obligations Asset Retirement Obligations (Notes) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||
ASSET RETIREMENT OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||
Asset Retirement Obligation Disclosure [Text Block] | Asset Retirement Obligations The following table presents the changes in the carrying amount of the asset retirement obligations associated with this Partnership's working interest in crude oil and natural gas properties:
The current portion of the asset retirement obligations relates to wells that are producing minimal or no hydrocarbons and are expected to be plugged and abandoned within the next 12 months. This Partnership's estimated asset retirement obligation liability is based on historical experience in plugging and abandoning wells, estimated economic lives, estimated plugging and abandonment cost and federal and state regulatory requirements. The liability is discounted using the credit-adjusted risk-free rate estimated at the time the liability is incurred or revised. During the three months ended March 31, 2016, the credit-adjusted risk-free rates used to discount this Partnership's plugging and abandonment liabilities ranged from 7.6% to 8.0%. In periods subsequent to initial measurement of the liability, this Partnership must recognize period-to-period changes in the liability resulting from the passage of time, revisions to either the amount of the original estimate of undiscounted cash flows or changes in inflation factors and changes to this Partnership's credit-adjusted risk-free rate as market conditions warrant. |
Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | In the Managing General Partner's opinion, the accompanying condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of this Partnership's results for interim periods in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Accordingly, pursuant to such rules and regulations, certain notes and other financial information included in the audited financial statements have been condensed or omitted. The December 31, 2015 condensed balance sheet data was derived from audited statements, but does not include disclosures required by U.S. GAAP. The information presented in this Quarterly Report on Form 10-Q should be read in conjunction with this Partnership's audited financial statements and notes thereto included in this Partnership's 2015 Form 10-K. This Partnership's accounting policies are described in the Notes to Financial Statements in this Partnership's 2015 Form 10-K and updated, as necessary, in this Quarterly Report on Form 10-Q. The results of operations and cash flows for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the full year or any future period. |
Recent Accounting Standards Significant Accounting Policies (Policies) |
3 Months Ended |
---|---|
Mar. 31, 2016 | |
Significant Accounting Policies [Abstract] | |
Recently Issued Accounting Standards [Text Block] | Recently Issued Accounting Standards In May 2014, the Financial Accounting Standards Board ("FASB") and the International Accounting Standards Board issued their converged standard on revenue recognition that provides a single, comprehensive model that entities will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The standard outlines a five-step approach to apply the underlying principle: (1) identify the contract with the customer, (2) identify the separate performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to separate performance obligations and (5) recognize revenue when (or as) each performance obligation is satisfied. In March 2016, the FASB issued an update to the standard intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations when recognizing revenue. The revenue standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The revenue standard can be adopted under the full retrospective method or simplified transition method. Entities are permitted to adopt the revenue standard early, beginning with annual reporting periods after December 15, 2016. The Managing General Partner of this Partnership is currently evaluating the impact these changes may have on this Partnership's financial statements. In August 2014, the FASB issued a new standard related to the disclosure of uncertainties about an entity's ability to continue as a going concern. The new standard will explicitly require management to assess an entity's ability to continue as a going concern every reporting period and to provide related footnote disclosures in certain circumstances. The new standard will be effective for all entities in the first annual period ending after December 15, 2016, with early adoption permitted. The Managing General Partner of this Partnership is currently evaluating the impact these changes may have on this Partnership's financial statements. |
Transactions with Managing General Partner Transactions with Managing General Partner (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Due from (to) Managing General Partner-other, net [Table Text Block] | The following table presents transactions with the Managing General Partner reflected in the condensed balance sheets line item “Due to Managing General Partner-other, net,” which remain undistributed or unsettled with this Partnership's investors as of the dates indicated:
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Schedule of Related Party Transactions [Table Text Block] | The following table presents Partnership transactions with the Managing General Partner for the three months ended March 31, 2016 and 2015. “Well operations and maintenance” is included in the “Crude oil, natural gas and NGLs production costs” line item on the condensed statements of operations.
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Asset Retirement Obligations Asset Retirement Obligations (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||
ASSET RETIREMENT OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Change in Asset Retirement Obligation [Table Text Block] | The following table presents the changes in the carrying amount of the asset retirement obligations associated with this Partnership's working interest in crude oil and natural gas properties:
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General and Basis of Presentation General and Basis of Presentation (Details) |
3 Months Ended |
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Mar. 31, 2016
Number_of_Limited_Partners
$ / shares
shares
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of Investor Partners | Number_of_Limited_Partners | 1,759 |
Managing General Partner, Ownership Interest Before Unit Repurchases | 37.00% |
Investor Partner Ownership Interest | 63.00% |
Limited Partner Units Repurchased by Managing General Partner | shares | 139 |
Average Price Paid for Units Repurchased by Managing General Partner | $ / shares | $ 2,470 |
Managing General Partner Ownership Interest | 39.00% |
Transactions with Managing General Partner Undistributed or Unsettled Transactions With Investor Partners (Details) - USD ($) |
Mar. 31, 2016 |
Dec. 31, 2015 |
||
---|---|---|---|---|
Related Party Transaction | ||||
Due from (to) Managing General Partner-other, net | $ (203,435) | $ (236,289) | ||
Crude oil, natural gas and NGLs sales revenues collected from the Partnership's third-party customers | ||||
Related Party Transaction | ||||
Due from (to) Managing General Partner-other, net | 86,527 | 123,519 | ||
Other | ||||
Related Party Transaction | ||||
Due from (to) Managing General Partner-other, net | [1] | $ (289,962) | $ (359,808) | |
|
Transactions with Managing General Partner Related Party Transactions (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2016 |
Mar. 31, 2015 |
|||
Related Party Transaction | ||||
Direct costs - general and administrative | $ 35,916 | $ 21,713 | ||
Transactions with Managing General Partner | ||||
Related Party Transaction | ||||
Well operations and maintenance | 262,753 | 255,731 | ||
Direct costs - general and administrative | 35,916 | 21,713 | ||
Cash distributions | [1] | $ 0 | 84,220 | |
Cash distributions for Investor Partner units repurchased by PDC | $ 2,521 | |||
|
Commitments and Contingencies Commitments and Contingencies (Details) - USD ($) |
Mar. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Accrued environmental remediation liabilities | $ 700 | $ 1,600 |
Asset Retirement Obligations Asset Retirement Obligations (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2015 |
|
Changes in asset retirement obligations | |||
Balance at December 31, 2015 | $ 2,313,683 | ||
Accretion Expense | 46,808 | $ 34,467 | |
Balance at March 31, 2016 | 2,360,491 | ||
Less current portion | (230,000) | $ (230,000) | |
Long-term portion | $ 2,130,491 | $ 2,083,683 |
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