-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QiVmLAbtF00qZDA0ARS7PTsL5HTRyoA98VoFsHxHnpyxJT2kK9klLJhwFZbLk7ED S4xsslQstOmrxLJXO5zlsw== 0000788965-97-000004.txt : 19970520 0000788965-97-000004.hdr.sgml : 19970520 ACCESSION NUMBER: 0000788965-97-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HALLADOR PETROLEUM CO CENTRAL INDEX KEY: 0000788965 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 841014610 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-14731 FILM NUMBER: 97606322 BUSINESS ADDRESS: STREET 1: 1660 LINCOLN ST STE 2700 CITY: DENVER STATE: CO ZIP: 80264 BUSINESS PHONE: 3038395505 MAIL ADDRESS: STREET 1: 1660 LINCOLN STREET STREET 2: SUITE 2700 CITY: DENVER STATE: CO ZIP: 80264 FORMER COMPANY: FORMER CONFORMED NAME: KIMBARK OIL & GAS CO /CO/ DATE OF NAME CHANGE: 19900102 FORMER COMPANY: FORMER CONFORMED NAME: KIMBARK INC DATE OF NAME CHANGE: 19860624 10QSB 1 FIRST QUARTER 1997 FORM 10-QSB U.S. Securities and Exchange Commission Washington, D.C. 20549 Form 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1997 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT Commission File Number 0-14731 HALLADOR PETROLEUM COMPANY (Exact name of small business issuer as specified in its charter) COLORADO 84-1014610 (State or other jurisdiction (IRS Employer of incorporation or organization) Identification No.) 1660 Lincoln Street, Suite 2700, Denver, Colorado 80264 (Address of principal executive offices) 303-839-5504 FAX: 303-832-3013 (Issuer's telephone number) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes [x] No [ ] As of May 14, 1997, 7,093,150 shares of the issuer's common stock were outstanding. This report contains 7 pages. There are no exhibits. PART I. FINANCIAL INFORMATION: HALLADOR PETROLEUM COMPANY Consolidated Balance Sheet (in thousands)
March 31, December 31, 1997 1996* --------- ----------- ASSETS Current assets: Cash and cash equivalents $ 2,323 $ 2,898 Short-term investments 900 900 Accounts receivable- Oil and gas sales 374 505 Well operations 330 365 ------- ------- Total current assets 3,927 4,668 ------- ------- Oil and gas properties (full cost accounting), at cost: Unproved properties 1,557 711 Evaluated properties 39,645 39,527 Less - accumulated depreciation, depletion, amortization (32,825) (32,691) ------- ------- 8,377 7,547 ------- ------- Other assets 174 165 ------- ------- $ 12,478 $ 12,380 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 483 $ 317 Oil and gas sales payable 126 169 Debt with recourse only to the South Cuyama Field 360 590 ------- ------- Total current liabilities 969 1,076 ------- ------- Debt with recourse only to the South Cuyama Field 5,080 5,231 ------- ------- Deferred Bonus Plan 189 178 ------- ------- Other 110 110 ------- ------- Stockholders' equity: Preferred stock, $.10 par value; 10,000,000 shares authorized; no shares issued Common stock, $.01 par value; 100,000,000 shares authorized; 7,093,150 shares issued 71 71 Additional paid-in capital 18,061 18,061 Accumulated deficit (12,002) (12,347) ------- ------- 6,130 5,785 ------- ------- $ 12,478 $ 12,380 ======= =======
*Derived from the Form 10-KSB. See accompanying notes. 2 HALLADOR PETROLEUM COMPANY Consolidated Statement of Income (in thousands, except per share amounts)
Three months ended March 31, 1997 1996 ------- ------- Revenue: Oil $ 1,079 $ 970 Gas 93 80 NGLs 130 128 Interest 43 53 Other 35 ------ ------ 1,345 1,266 ------ ------ Costs and expenses: Lease operating 630 727 Depreciation, depletion and amortization 134 141 General and administrative 107 89 Interest 129 157 ------ ------ 1,000 1,114 ------ ------ Net income $ 345 $ 152 ====== ====== Net income per share $ .05 $ .02 ====== ====== Weighted average shares outstanding 7,093 7,098 ====== ======
See accompanying notes. 3 HALLADOR PETROLEUM COMPANY Consolidated Statement of Cash Flows (in thousands)
Three months ended March 31, 1997 1996 ------- ------- Cash flows from operating activities $ 694 $ 544 ------ ------ Cash flows used in investing activities: Short-term investments (900) Additions to oil and gas properties (124) (30) Additions to unproved properties (764) (53) ------ ------ Net cash (used in) investing activities (888) (983) ------ ------ Cash flows used in financing activities: Repayments of debt (381) (178) ------ ------ Net (decrease) in cash and cash equivalents (575) (617) Cash and cash equivalents, beginning of period 2,898 3,459 ------ ------ Cash and cash equivalents, end of period $ 2,323 $ 2,842 ====== ======
NOTES TO FINANCIAL STATEMENTS 1. The interim financial data is unaudited; however, in the opinion of management, the interim data includes all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the results for the interim periods. The financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principals have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included herein are adequate to make the information presented not misleading. The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to the Company's financial statements filed as part of the Company's December 31, 1996 Form 10-KSB. This quarterly report should be read in conjunction with such annual report. 4 HALLADOR PETROLEUM COMPANY MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION RESULTS OF OPERATIONS Year-to-date Comparison 1997 1996 Sales Volume Average Price Sales Volume Average Price ------------ ------------- ------------ ------------- Oil - barrels 51,635 $20.90 55,696 $17.41 Gas - MCF 30,313 3.08 52,945 1.51 NGLs- barrels 7,388 17.60 9,549 13.35 Revenue increased due to a higher average prices. Higher prices more than offset the decline in sales resulting from lower production levels. Assuming no success from the current exploration activities, the Company projects 1997 net income to be lower than 1996 reported net income due to declining prices. OUTLOOK FOR REMAINDER OF 1997 Prospect Development and Exploration Activity The following discussion updates the "Management's Discussion and Analysis or Plan of Operation" contained under Item 6 of the 1996 Form 10-KSB and should be read in conjunction therewith. Through March 31, 1997 and May 14, 1997, the Company has invested $1,557,000 and $1,807,000, respectively, in these activities. These costs, most of which represent high-risk, high-reward investments may or may not prove successful. Sacramento Basin - California The first well is expected to spud May 14, 1997. The well will test the Forbes formation at a depth of 6,000 feet and will take six days to drill. Notwithstanding the results of the first well, two additional wells are planned to spud during the next thirty days. Dry-hole cost and completion cost for each well is expected to be $200,000, respectively. The Company has a 60% working interest in each well. Williston Basin, North Dakota and Montana The Company entered into a joint venture (JV) which obtained five-year leases covering 30,000 net acres in North Dakota. The Company has invested approximately $500,000 for a 55% interest in the JV; the other party contributed seismic and geological studies for its 45% interest. The Company is entitled to recoup its investment before the other joint venture partner shares in any profits. The Company plans to sell the acreage and retain an overriding royalty interest or carried working interest. 5 Liquidity and Capital Resources Cash, short-term investments and cash from operations is expected to enable the Company to meet its obligations as they come due during the next several years. California Oil Prices As of May 14, 1997, the Company was receiving $18.00 for its California oil production which is $3 below the average price received for the first quarter of 1997 and about $1.50 below the average price received during the calendar year 1996. Furthermore, on May 1, 1997, KOCH, the Company's purchaser, advised that it no longer plans to pay the $.30 premium over postings which has been the arrangement for the last three years. The new lower pricing goes into effect November 1, 1997. The Company will attempt to find a new purchaser who will pay a higher price than that being proposed by KOCH. Environmental The Company is moving forward with its plan to install electric submersible pumps in the South Cuyama Field (the "Field"). This entails replacing rod pumps, which are powered by natural gas, with submersible pumps which are powered by electricity. These pumps cost about $45,000 each. Management is studying a PG&E program (PG&E provides electricity to the Field) whereby the Company could be reimbursed by PG&E for half the cost of each pump. Currently four pumps have been placed in service on a trial basis by the pump vendor. Pending the results of the trial period and the discussions with PG&E, 13 to 20 pumps may be placed in service; these 20 wells account for 65% of the Field's production. Some of the benefits of using electrical pumps are (i) an increase in natural gas revenue since gas is sold as opposed to being consumed in the Field, (ii) lower repair and maintenance expense, (iii) increased oil production because more water is being moved, and (iv) less emissions, which results in less environmental regulation and costs. The downside is the capital cost and the higher electricity bills; the advantages more than offset the disadvantages. Financing The Company is negotiating with Dillon, Read & Co. Inc. with regards to an additional cash investment. Once an agreement is reached, disclosure will be made in a Form 8-K. New Accounting Rules for EPS In February 1997, FAS 128 dealing with earnings per share calculations was issued which will be effective for the 1997 Form 10-KSB. The adoption of this standard will not have a material effect on the Company's earnings per share calculation. 6 PART II. Other Information Item 6. Exhibits and Reports on Form 8-K (a) Exhibits Ex-27 -- Financial Data Schedule; EDGAR filing only. (b) No reports on Form 8-K were filed by the Company during the quarter ended March 31, 1997. SIGNATURE In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. HALLADOR PETROLEUM COMPANY Date: May 14, 1997 By:/s/Victor P. Stabio Victor P. Statio Chief Executive Officer and Chief Financial Officer Signing on behalf of the registrant and as principal financial and accounting officer. 7 EX-27 2 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the Consolidated Balance Sheet and the Company's Statement of Income found in the Company's Form 10-QSB for the year-to-date, and is qualified in its entirety by referenced to such financial statement. 0000788965 HALLADOR PETROLEUM COMPANY 1,000 3-MOS DEC-31-1996 MAR-31-1997 2,323 900 704 0 0 3,927 41,202 32,825 12,478 969 5,440 0 0 71 0 12,478 1,302 1,345 0 764 107 0 129 0 0 345 0 0 0 345 .05 0
-----END PRIVACY-ENHANCED MESSAGE-----