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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2005
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ________________
Commission file number 0-19585
SOUTHWEST OIL & GAS 1990-91 INCOME PROGRAM
Southwest Oil & Gas Income Fund X-B, L.P.
(Exact name of registrant as specified
in its limited partnership agreement)
Delaware 75-2332176
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6 Desta Drive, Suite 6500
Midland, Texas 79705
(Address of principal executive offices)
(432) 682-6324
(Registrant's telephone number,
including area code)
Indicate by check mark whether registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days:
Yes X No ___
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2). Yes No X
The registrant's outstanding securities consist of Units of limited
partnership interests for which there exists no established public market
from which to base a calculation of aggregate market value.
The total number of pages contained in this report is 21.
Glossary of Oil and Gas Terms
The following are abbreviations and definitions of terms commonly used in
the oil and gas industry that are used in this filing. All volumes of
natural gas referred to herein are stated at the legal pressure base to the
state or area where the reserves exit and at 60 degrees Fahrenheit and in
most instances are rounded to the nearest major multiple.
Bbl. One stock tank barrel, or 42 United States gallons liquid volume.
BOE. Equivalent barrels of oil, with natural gas converted to oil
equivalents based on a ratio of six Mcf of natural gas to one Bbl of oil.
Developmental well. A well drilled within the proved area of an oil or
natural gas reservoir to the depth of a stratigraphic horizon known to be
productive.
Exploratory well. A well drilled to find and produce oil or gas in an
unproved area to find a new reservoir in a field previously found to be
productive of oil or natural gas in another reservoir or to extend a known
reservoir.
Farm-out arrangement. An agreement whereby the owner of a leasehold or
working interest agrees to assign his interest in certain specific acreage
to an assignee, retaining some interest, such as an overriding royalty
interest, subject to the drilling of one (1) or more wells or other
specified performance by the assignee.
Field. An area consisting of a single reservoir or multiple reservoirs
all grouped on or related to the same individual geological structural
feature and/or stratigraphic condition.
Mcf. One thousand cubic feet.
Net Profits Interest. An agreement whereby the owner receives a
specified percentage of the defined net profits from a producing property
in exchange for consideration paid. The net profits interest owner will
not otherwise participate in additional costs and expenses of the property.
Oil. Crude oil, condensate and natural gas liquids.
Overriding royalty interest. Interests that are carved out of a
working interest, and their duration is limited by the term of the lease
under which they are created.
Present value and PV-10 Value. When used with respect to oil and
natural gas reserves, the estimated future net revenue to be generated from
the production of proved reserves, determined in all material respects in
accordance with the rules and regulations of the SEC (generally using
prices and costs in effect as of the date indicated) without giving effect
to non-property related expenses such as general and administrative
expenses, debt service and future income tax expenses or to depreciation,
depletion and amortization, discounted using an annual discount rate of
10%.
Production costs. Costs incurred to operate and maintain wells and
related equipment and facilities, including depreciation and applicable
operating costs of support equipment and facilities and other costs of
operating and maintaining those wells and related equipment and facilities.
Proved Area. The part of a property to which proved reserves have been
specifically attributed.
Proved developed oil and gas reserves. Proved oil and gas reserves
that can be expected to be recovered from existing wells with existing
equipment and operating methods.
Proved properties. Properties with proved reserves.
Proved oil and gas reserves. The estimated quantities of crude oil,
natural gas, and natural gas liquids with geological and engineering data
that demonstrate with reasonable certainty to be recoverable in future
years from known reservoirs under existing economic and operating
conditions, i.e., prices and costs as of the date the estimate is made.
Proved undeveloped reserves. Proved oil and gas reserves that are
expected to be recovered from new wells on undrilled acreage, or from
existing wells where a relatively major expenditure is required for
recompletion.
Reservoir. A porous and permeable underground formation containing a
natural accumulation of producible oil or gas that is confined by
impermeable rock or water barriers and is individual and separate from
other reservoirs.
Royalty interest. An interest in an oil and natural gas property
entitling the owner to a share of oil or natural gas production free of
costs of production.
Working interest. The operating interest that gives the owner the
right to drill, produce and conduct operating activities on the property
and a share of production.
Workover. Operations on a producing well to restore or increase
production.
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
The unaudited condensed financial statements included herein have been
prepared by the Registrant (herein also referred to as the "Partnership")
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments necessary for a fair presentation have been included and are of
a normal recurring nature. The financial statements should be read in
conjunction with the audited financial statements and the notes thereto for
the year ended December 31, 2004, which are found in the Registrant's Form
10-K Report for 2004 filed with the Securities and Exchange Commission.
The December 31, 2004 balance sheet included herein has been taken from the
Registrant's 2004 Form 10-K Report. Operating results for the three month
period ended March 31, 2005 are not necessarily indicative of the results
that may be expected for the full year.
Southwest Oil & Gas Income Fund X-B, L.P.
Balance Sheets
March December
31, 31,
2005 2004
----- -----
(unaudit
ed)
Current assets:
Cash and cash equivalents $ 30,755 35,848
Receivable from Managing 65,759 80,716
General Partner
-------- --------
---- ----
Total current assets 96,514 116,564
-------- --------
---- ----
Oil and gas properties -
using the full-
cost method of accounting 4,167,07 4,166,45
8 2
Less accumulated
depreciation,
depletion and 3,782,39 3,776,13
amortization 6 8
-------- --------
---- ----
Net oil and gas 384,682 390,314
properties
-------- --------
---- ----
$ 481,196 506,878
======= =======
Liabilities and Partners'
Equity
- ----------------------------
- ------------
Current liability - $ 545 570
distribution payable
-------- --------
---- ----
Asset retirement obligation 143,516 143,329
-------- --------
---- ----
Partners' equity:
General partners 18,357 20,316
Limited partners 318,778 342,663
-------- --------
---- ----
Total partners' equity 337,135 362,979
-------- --------
---- ----
$ 481,196 506,878
======= =======
The accompanying notes are an integral
part of these financial statements.
Southwest Oil & Gas Income Fund X-B, L.P.
Statements of Operations
(unaudited)
Three Months Ended
March 31,
2005 2004
----- -----
Revenues
- -------------
Oil and gas $ 224,689 159,382
Interest 187 100
Other - 250
-------- --------
-- --
224,876 159,732
-------- --------
-- --
Expenses
- ------------
Production 90,584 85,616
Depreciation, depletion and 6,258 8,000
amortization
Accretion of asset retirement 1,828 2,730
obligation
General and administrative 22,050 21,716
-------- --------
-- --
120,720 118,062
-------- --------
-- --
Net income from continued 104,156 41,670
operations
Results from discontinued
operations -
sale of oil and gas leases - - (28,280)
See Note 3
-------- --------
-- --
Net income $ 104,156 13,390
====== ======
Net income allocated to:
Managing General Partner $ 9,937 1,925
====== ======
General partner $ 1,104 214
====== ======
Limited partners $ 93,115 11,251
====== ======
Per limited partner unit
before discontinued
operations $ 8.55
3.37
Discontinued operations per - (2.34)
limited partner unit
-------- --------
-- --
Per limited partner unit $ 8.55 1.03
====== ======
The accompanying notes are an integral
part of these financial statements.
Southwest Oil & Gas Income Fund X-B, L.P.
Statements of Cash Flows
(unaudited)
Three Months Ended
March 31,
2005 2004
----- -----
Cash flows from operating
activities:
Cash from oil and gas sales $ 239,646 204,929
Cash paid to suppliers (114,275 (107,332
) )
Cash received from discontinued - (28,280)
operations
Interest received 187 100
Other - 250
-------- --------
--- ---
Net cash provided by operating 125,558 69,667
activities
-------- --------
--- ---
Cash flows used in investing
activities:
Additions to oil and gas (626) (1,700)
properties
-------- --------
--- ---
Cash flows from financing
activities:
Distributions to partners (130,000 (65,506)
)
Increase (decrease) in (25) 115
distribution payable
-------- --------
--- ---
Net cash used in financing (130,025 (65,391)
activities )
-------- --------
--- ---
Net (decrease) increase in cash (5,093) 2,576
and cash equivalents
Beginning of period 35,848 20,125
-------- --------
--- ---
End of period $ 30,755 22,701
====== ======
Reconciliation of net income to
net cash
provided by operating
activities:
Net income $ 104,156 13,390
Adjustments to reconcile net
income to net cash
provided by operating
activities:
Depreciation, depletion and 6,258 8,000
amortization
Accretion of asset retirement 1,828 2,730
obligation
Adjust asset retirement for plug
and
abandonment wells (1,641) -
Decrease in receivables 14,957 45,547
Increase in payables - -
-------- --------
--- ---
Net cash provided by operating $ 125,558 69,667
activities
====== ======
The accompanying notes are an integral
part of these financial statements.
Southwest Oil & Gas Income Fund X-B, L.P.
(a Delaware limited partnership)
Notes to Financial Statements
1. Organization
Southwest Oil & Gas Income Fund X-B, L.P. was organized under the laws
of the state of Delaware on November 27, 1990 for the purpose of
acquiring producing oil and gas properties and to produce and market
crude oil and natural gas produced from such properties for a term of
50 years, unless terminated at an earlier date as provided for in the
Partnership Agreement. The Partnership sells its oil and gas
production to a variety of purchasers with the prices it receives
being dependent upon the oil and gas economy. Southwest Royalties,
Inc., a wholly owned subsidiary of Clayton Williams Energy, Inc.,
serves as the Managing General Partner. Revenues, costs and expenses
are allocated as follows:
Limited General
Partners Partners
-------- --------
Interest income on 100% -
capital contributions
Oil and gas sales 90% 10%
All other revenues 90% 10%
Organization and 100% -
offering costs (1)
Amortization or 100% -
organization costs
Property acquisition 100% -
costs
Gain/loss on property 90% 10%
disposition
Operating and 90% 10%
administrative costs
(2)
Depreciation,
depletion, and
amortization
of oil and gas 100% -
properties
All other costs 90% 10%
(1) All organization costs in excess of 3% of initial capital
contributions will be paid by the Managing General Partner and
will be treated as a capital contribution. The Partnership paid
the Managing General Partner an amount equal to 3% of initial
capital contributions for such organization costs.
(2) Administrative costs in any year, which exceed 2% of capital
contributions shall be paid by the Managing General Partner and
will be treated as a capital contribution.
2. Summary of Significant Accounting Policies
The interim financial information as of March 31, 2005, and for the
three months ended March 31, 2005, is unaudited. Certain information
and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted in this Form 10-Q pursuant to the rules
and regulations of the Securities and Exchange Commission. However,
in the opinion of management, these interim financial statements
include all the necessary adjustments to fairly present the results of
the interim periods and all such adjustments are of a normal recurring
nature. The interim consolidated financial statements should be read
in conjunction with the Partnership's Annual Report on Form 10-K for
the year ended December 31, 2004.
In September 2004, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 106 ("SAB 106"). SAB 106 expresses the SEC
staff's views regarding SFAS No. 143 and its impact on both the full-
cost ceiling test and the calculation of depletion expense. In
accordance with SAB 106, beginning in the first quarter of 2005,
undiscounted abandonment costs for wells to be drilled in the future
to develop proved reserves are included in the unamortized cost of oil
and gas properties, net of related salvage value, for purposes of
computing depreciation, depletion and amortization ("DD&A"). The
implementation of SAB 106 did not have a material impact on our
financial statements.
Southwest Oil & Gas Income Fund X-B, L.P.
(a Delaware limited partnership)
Notes to Financial Statements
3. Discontinued Operations - Sale of oil leases
During 2003, the Partnership sold its interest in certain oil wells
for $239,402 sales proceeds and retired $605,481 of asset retirement
obligation associated with the properties. The Partnership recognized
a gain of $784,359 on the sale during the fourth quarter of 2003.
Pursuant to the requirements of SFAS No. 144, the historical operating
results from these properties have been reported as discontinued
operations in the accompanying statements of operations. Operating
expenses for 2004 represent plugging and abandonment costs that the
Partnership was contractually committed to perform subsequent to the
sale of the property. Plugging and abandonment services were
performed during the quarter ended March 31, 2004. The following
table summarizes certain operating information related to the
discontinued operations:
Three
months
ended
March 31,
2004
Revenues $ -
Operating expenses 28,280
---------
---
Loss from
discontinued $(28,2
operations 80)
=======
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
General
Southwest Oil & Gas Income Fund X-B, L.P. was organized as a Delaware
limited partnership on November 27, 1990. The offering of such limited
partnership interests began on December 1, 1990 as part of a shelf offering
registered under the name Southwest Oil & Gas 1990-91 Income Program.
Minimum capital requirements for the Partnership were met on March 1, 1991,
with the offering of limited partnership interests concluding on September
30, 1991, with total limited partner contributions of $5,444,500.
The Partnership was formed to acquire interests in producing oil and gas
properties, to produce and market crude oil and natural gas produced from
such properties, and to distribute the net proceeds from operations to the
limited and general partners. Net revenues from producing oil and gas
properties will not be reinvested in other revenue producing assets except
to the extent that production facilities and wells are improved or reworked
or where methods are employed to improve or enable more efficient recovery
of oil and gas reserves. The economic life of the Partnership thus depends
on the period over which the Partnership's oil and gas reserves are
economically recoverable.
Increases or decreases in Partnership revenues and, therefore,
distributions to partners will depend primarily on changes in the prices
received for production, changes in volumes of production sold, lease
operating expenses, enhanced recovery projects, offset drilling activities
pursuant to farm-out arrangements, sales of properties, and the depletion
of wells. Since wells deplete over time, production can generally be
expected to decline from year to year.
Well operating costs and general and administrative costs usually decrease
with production declines; however, these costs may not decrease
proportionately. Net income available for distribution to the partners is
therefore expected to decline in later years based on these factors.
Oil and Gas Properties
Oil and gas properties are accounted for at cost under the full-cost
method. Under this method, all productive and nonproductive costs incurred
in connection with the acquisition, exploration and development of oil and
gas reserves are capitalized. Gain or loss on the sale of oil and gas
properties is not recognized unless significant oil and gas reserves are
sold.
Should the net capitalized costs exceed the estimated present value of oil
and gas reserves, discounted at 10%, such excess costs would be charged to
current expense. As of March 31, 2005, the net capitalized costs did not
exceed the estimated present value of oil and gas reserves.
Critical Accounting Policies
The Partnership follows the full cost method of accounting for its oil and
gas properties. The full cost method subjects companies to quarterly
calculations of a "ceiling", or limitation on the amount of properties that
can be capitalized on the balance sheet. If the Partnership's capitalized
costs are in excess of the calculated ceiling, the excess must be written
off as an expense.
The Partnership's discounted present value of its proved oil and natural
gas reserves is a major component of the ceiling calculation, and
represents the component that requires the most subjective judgments.
Estimates of reserves are forecasts based on engineering data, projected
future rates of production and the timing of future expenditures. The
process of estimating oil and natural gas reserves requires substantial
judgment, resulting in imprecise determinations, particularly for new
discoveries. Different reserve engineers may make different estimates of
reserve quantities based on the same data. The Partnership's reserve
estimates are prepared by outside consultants.
The passage of time provides more qualitative information regarding
estimates of reserves, and revisions are made to prior estimates to reflect
updated information. However, there can be no assurance that more
significant revisions will not be necessary in the future. If future
significant revisions are necessary that reduce previously estimated
reserve quantities, it could result in a full cost property writedown. In
addition to the impact of these estimates of proved reserves on calculation
of the ceiling, estimates of proved reserves are also a significant
component of the calculation of depletion, depreciation, and amortization
("DD&A").
While the quantities of proved reserves require substantial judgment, the
associated prices of oil and natural gas reserves that are included in the
discounted present value of the reserves do not require judgment. The
ceiling calculation dictates that prices and costs in effect as of the last
day of the period are generally held constant indefinitely. Because the
ceiling calculation dictates that prices in effect as of the last day of
the applicable quarter are held constant indefinitely, the resulting value
is not indicative of the true fair value of the reserves. Oil and natural
gas prices have historically been cyclical and, on any particular day at
the end of a quarter, can be either substantially higher or lower than the
Partnership's long-term price forecast that is a barometer for true fair
value.
Results of Operations
General Comparison of the Quarters Ended March 31, 2005 and 2004
The following table provides certain information regarding performance
factors for the quarters ended March 31, 2005 and 2004:
Three Months
Ended Percenta
ge
March 31, Increase
2005 2004 (Decreas
e)
----- ---- --------
--
Oil production in 3,400 3,270 4%
barrels
Gas production in mcf 11,485 10,200 13%
Total BOE 5,314 4,970 7%
Average price per $ 49.22 50%
barrel of oil 32.91
Average price per mcf $ 4.99 (2%)
of gas 5.07
Oil and gas revenue $ 224,689 159,382 41%
Production expense $ 90,584 85,616 6%
Partnership $ 130,000 65,506 98%
distributions
Limited partner $ 117,000 65,506 79%
distributions
Per unit distribution
to limited
partners $ 10.74 79%
6.02
Number of limited 10,889 10,889
partner units
Revenues
The Partnership's oil and gas revenues increased to $224,689 from $159,382
for the quarters ended March 31, 2005 and 2004, respectively, an increase
of 41%. The principal factors affecting the comparison of the quarters
ended March 31, 2005 and 2004 are as follows:
The average price for a barrel of oil received by the Partnership increased
during the quarter ended March 31, 2005 as compared to the quarter ended
March 31, 2004 by 50%, or $16.31 per barrel, resulting in an increase of
approximately $55,500 in revenues. Oil sales represented 74% of total oil
and gas sales during the quarters ended March 31, 2005 as compared to 68%
during the quarter ended March 31, 2004.
The average price for an mcf of gas received by the Partnership decreased
during the same period by 2%, or $.08 per mcf, resulting in a decrease of
approximately $1,000 in revenues.
The net total increase in revenues due to the change in prices received
from oil and gas production is approximately $54,500. The market price for
oil and gas has been extremely volatile over the past decade and management
expects a certain amount of volatility to continue in the foreseeable
future.
Oil production increased approximately 130 barrels or 4% during the quarter
ended March 31, 2005 as compared to the quarter ended March 31, 2004,
resulting in an increase of approximately $4,300 in revenues.
Gas production increased approximately 1,285 mcf or 13% during the same
period, resulting in an increase of approximately $6,500 in revenues.
The total increase in revenues due to the change in production is
approximately $10,800. The increase in gas volumes is due to the
reactivation of a gas well.
Costs and Expenses
Total costs and expenses increased to $120,720 for the quarter ended March
31, 2005 from $118,062 for the same period in 2004. This represents an
increase of 2%. The increase is a result of the higher depletion expense,
lease operating expense and general and administrative expense, partially
offset by a decrease in accretion expense.
Lease operating costs and production taxes were 6% higher, or approximately
$5,000 more during the quarter ended March 31, 2005 as compared to the
quarter ended March 31, 2004.
General and administrative costs consist of independent accounting and
engineering fees, computer services, postage, and Managing General Partner
personnel costs. General and administrative costs increased 1% or
approximately $300 during the quarter ended March 31, 2005 as compared to
the quarter ended March 31, 2004.
Depletion expense decreased to $6,258 for the quarter ended March 31, 2005
from $8,000 for the same period in 2004. This represents an decrease of
22%. The contributing factor to the decrease in depletion expense is in
relation to the BOE depletion rate for the quarter ended March 31, 2005,
which was $1.18 applied to 5,314 BOE as compared to $1.61 applied to 4,970
BOE for the same period in 2004. The lower depletion rate in 2005 is due
to the upward revision in reserve estimates resulting from higher oil and
gas prices.
Accretion expense decreased to $1,828 for the quarter ended March 31, 2005
from $2,730 for the same period in 2004. This represents a decrease of
33%. The decrease in accretion is from discontinuing accretion on several
wells that reached their projected end of life in 2004.
Liquidity and Capital Resources
The primary source of cash is from operations, the receipt of income from
interests in oil and gas properties. The Partnership knows of no material
change, nor does it anticipate any such change.
Cash flows provided by operating activities were approximately $125,600 in
the quarter ended March 31, 2005 as compared to approximately $69,700 in
the quarter ended March 31, 2004.
Cash flows used in investing activities were approximately $600 in the
quarter ended March 31, 2005 as compared to approximately $1,700 in the
quarter ended March 31, 2004. The principle use of the 2005 cash flow from
investing activities was the addition to oil and gas properties.
Cash flows used in financing activities were approximately $130,000 in the
quarter ended March 31, 2005 as compared to approximately $65,400 in the
quarter ended March 31, 2004. The only use in financing activities was the
distribution to partners.
Total distributions during the quarter ended March 31, 2005 were $130,000
of which $117,000 ($10.74 per unit) was distributed to the limited partners
and $13,000 to the general partners. Total distributions during the
quarter ended March 31, 2004 were $65,506 of which $65,506 ($6.02 per unit)
was distributed to the limited partners.
The sources for the 2005 distributions of $130,000 were oil and gas
operations of approximately $125,600, and the change in oil and gas
properties of approximately $(600), with the balance from available cash on
hand at the beginning of the period. The sources for the 2004
distributions of $65,500 were oil and gas operations of approximately
$69,700 and the change of oil and gas properties of approximately $(1,700),
resulting in excess cash for contingencies or subsequent distributions.
Cumulative cash distributions of $6,088,119 have been made to the general
and limited partners. As of March 31, 2005, $5,519,774 or $506.91 per
limited partner unit has been distributed to the limited partners,
representing a 101% return of the capital contributed.
As of March 31, 2005, the Partnership had approximately $96,000 in working
capital. The Managing General Partner knows of no unusual contractual
commitments. Although the partnership held many long-lived properties at
inception, because of the restrictions on property development imposed by
the partnership agreement, the Partnership cannot develop its non-producing
properties, if any. Without continued development, the producing reserves
continue to deplete. Accordingly, as the Partnership's properties have
matured and depleted, the net cash flows from operations for the
partnership has steadily declined, except in periods of substantially
increased commodity pricing. Maintenance of properties and administrative
expenses for the Partnership are increasing relative to production. As the
properties continue to deplete, maintenance of properties and
administrative costs as a percentage of production are expected to continue
to increase.
Recent Accounting Pronouncements
In December 2004, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 153 "Exchanges of
Nonmonetary Assets, an amendment of APB Opinion No. 29" ("SFAS 153").
SFAS 153 specifies the criteria required to record a nonmonetary asset
exchange using carryover basis. SFAS 153 is effective for nonmonetary
asset exchanges occurring after July 1, 2005. The Partnership will adopt
this statement in the third quarter of 2005, and it is not expected to have
a material effect on the financial statements when adopted.
In September 2004, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 106 ("SAB 106"). SAB 106 expresses the SEC staff's
views regarding SFAS No. 143 and its impact on both the full-cost ceiling
test and the calculation of depletion expense. In accordance with SAB 106,
beginning in the first quarter of 2005, undiscounted abandonment costs for
wells to be drilled in the future to develop proved reserves are included
in the unamortized cost of oil and gas properties, net of related salvage
value, for purposes of computing depreciation, depletion and amortization
("DD&A"). The implementation of SAB 106 did not have a material impact on
our financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Partnership is not a party to any derivative or embedded derivative
instruments.
Item 4. Controls and Procedures
The Managing General Partner has established disclosure controls and
procedures that are adequate to provide reasonable assurance that
management will be able to collect, process and disclose both financial and
non-financial information, on a timely basis, in the Partnership's reports
to the SEC. Disclosure controls and procedures include all processes
necessary to ensure that material information is recorded, processed,
summarized and reported within the time periods specified in the SEC's
rules and forms, and is accumulated and communicated to management,
including our chief executive and chief financial officers, to allow timely
decisions regarding required disclosures.
With respect to these disclosure controls and procedures:
management has evaluated the effectiveness of the disclosure
controls and procedures as of the end of the period covered by
this report;
this evaluation was conducted under the supervision and with the
participation of management, including the chief executive and
chief financial officers of the Managing General Partner; and
it is the conclusion of chief executive and chief financial
officers of the Managing General Partner that these disclosure
controls and procedures are effective in ensuring that
information that is required to be disclosed by the Partnership
in reports filed or submitted with the SEC is recorded,
processed, summarized and reported within the time periods
specified in the rules and forms established by the SEC.
Internal Control Over Financial Reporting
There has not been any change in the Partnership's internal control over
financial reporting that occurred during the quarter ended March 31, 2005
that has materially affected, or is reasonably likely to materially affect,
its internal control over financial reporting.
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matter to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
31.1 Rule 13a-14(a)/15d-14(a) Certification
31.2 Rule 13a-14(a)/15d-14(a) Certification
32.1 Certification of Chief Executive Officer
and Chief Financial Officer
Pursuant to 18 U.S.C. Section 1350, as adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Southwest Oil & Gas Income Fund X-B, L.P.,
a
Delaware limited partnership
By: Southwest Royalties, Inc.,
Managing
General Partner
By: /s/ L. Paul Latham
L. Paul Latham
President and Chief Executive Officer
Date: May 16, 2005
SECTION 302 CERTIFICATION Exhibit 31.1
I, L. Paul Latham, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Southwest Oil &
Gas Income Fund X-B, L.P.
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)) 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, including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the period in
which this report is being prepared;
b)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
c)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
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
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 16, 2005 /s/ L. Paul Latham
L. Paul Latham
President and Chief Executive Officer
of Southwest Royalties, Inc., the
Managing General Partner of
Southwest Oil & Gas Income Fund X-B,
L.P.
SECTION 302 CERTIFICATION Exhibit 31.2
I, Mel G. Riggs, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Southwest Oil &
Gas Income Fund X-B, L.P.
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)) 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, including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the period in
which this report is being prepared;
b)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
c)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
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
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 16, 2005 /s/ Mel G. Riggs
Mel G. Riggs
Vice President and Chief Financial
Officer of
Southwest Royalties, Inc., the
Managing General Partner of
Southwest Oil & Gas Income Fund X-B,
L.P.
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND
CHIEF FINANCIAL OFFICER
Pursuant to 18 U.S.C. 1350 and in connection with the accompanying report
on Form 10-Q for the period ended March 31, 2005 that is being filed
concurrently with the Securities and Exchange Commission on the date hereof
(the "Report"), each of the undersigned officers of Southwest Oil & Gas
Income Fund X-B, L.P. (the "Company"), hereby certifies that:
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
operation of the Company.
/s/ L. Paul Latham
L. Paul Latham
President and Chief Executive Officer
of Southwest Royalties, Inc., the
Managing General Partner of
Southwest Oil & Gas Income Fund X-
B, L.P.
May 16, 2005
/s/ Mel G. Riggs
Mel G. Riggs
Vice President and Chief Financial
Officer of
Southwest Royalties, Inc., the
Managing General Partner of
Southwest Oil & Gas Income Fund X-
B, L.P.
May 16, 2005