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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the quarterly period ended September 30, 2002
Commission file number 1-9735
BERRY PETROLEUM COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 77-0079387
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5201 Truxtun Avenue, Suite 300, Bakersfield, California 93309-0645
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (661) 616-3900
Former name, Former Address and Former Fiscal Year, if Changed Since
Last Report:
NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or 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 ( )
The number of shares of each of the registrant's classes of capital
stock outstanding as of September 30, 2002 was 20,852,695 shares of
Class A Common Stock ($.01 par value) and 898,892 shares of Class B
Stock ($.01 par value). All of the Class B Stock is held by a
shareholder who owns in excess of 5% of the outstanding stock of the
registrant.
BERRY PETROLEUM COMPANY
SEPTEMBER 30, 2002
INDEX
PART I. Financial Information Page No.
Item 1. Financial Statements
Condensed Balance Sheets at
September 30, 2002 and December 31, 2001 3
Condensed Income Statements for the Three Month Periods
Ended September 30, 2002 and 2001 4
Condensed Income Statements for the Nine Month Periods
Ended September 30, 2002 and 2001 5
Condensed Statements of Comprehensive Income for the
Nine Month Periods Ended September 30, 2002 and 2001 6
Condensed Statements of Cash Flows for the
Nine Month Periods Ended September 30, 2002 and 2001 7
Notes to Condensed Financial Statements 8
Item 2. Management's Discussion and Analysis
Of Financial Condition and Results of Operations 9
Item 4. Controls and Procedures 14
PART II. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 14
Certifications 15
Exhibit index 17
2
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 1. Financial Statements
Condensed Balance Sheets
(In Thousands, Except Share Information)
September December 31,
30, 2002 2001
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 7,861 $ 7,238
Short-term investments available for sale 659 594
Accounts receivable 14,883 17,577
Prepaid expenses and other 4,542 2,792
-------- --------
Total current assets 27,945 28,201
Oil and gas properties (successful efforts
basis), buildings and equipment, net 214,026 203,413
Other assets 913 912
-------- --------
$ 242,884 $ 232,526
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 13,852 $ 11,197
Accrued liabilities 5,013 7,089
Federal and state income taxes payable 6,066 4,078
Fair value of derivatives 4,643 -
-------- --------
Total current liabilities 29,574 22,364
Long-term debt 13,000 25,000
Deferred income taxes 33,422 32,009
Fair value of derivatives 278 -
Shareholders' equity:
Preferred stock, $.01 par value; 2,000,000
shares authorized; no shares outstanding - -
Capital stock, $.01 par value:
Class A Common Stock, 50,000,000 shares
authorized; 20,852,695 shares issued and
outstanding at September 30, 2002
(20,833,094 at December 31, 2001) 209 208
Class B Stock, 1,500,000 shares authorized;
898,892 shares issued and outstanding
(liquidation preference of $899) 9 9
Capital in excess of par value 48,802 48,905
Accumulated other comprehensive income (loss) (2,953) -
Retained earnings 120,543 104,031
-------- --------
Total shareholders' equity 166,610 153,153
-------- --------
$ 242,884 $ 232,526
======== ========
The accompanying notes are an integral part of these financial statements.
3
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 1. Financial Statements
Condensed Income Statements
Three Month Periods Ended September 30, 2002 and 2001
(In Thousands, Except Per Share Data)
(Unaudited)
2002 2001
Revenues:
Sales of oil and gas $ 28,044 $ 22,440
Sales of electricity 7,172 9,555
Interest and other income, net 71 1,127
-------- --------
35,287 33,122
-------- --------
Expenses:
Operating costs - oil and gas production 11,402 9,761
Operating costs - electricity generation 7,172 9,555
Depreciation, depletion and amortization 4,126 3,864
General and administrative 2,277 1,543
Interest 179 959
-------- --------
25,156 25,682
-------- --------
Income before income taxes 10,131 7,440
Provision for income taxes 2,544 1,548
-------- --------
Net income $ 7,587 $ 5,892
======== ========
Basic net income per share $ .35 $ .27
======== ========
Diluted net income per share $ .35 $ .27
======== ========
Cash dividends per share $ .10 $ .10
======== ========
Weighted average number of shares of
capital stock outstanding used to
calculate basic net income per share 21,746 22,034
Effect of dilutive securities:
Stock options 166 132
Other 33 34
-------- --------
Weighted average number of shares of
capital stock used to calculate
diluted net income per share 21,945 22,200
======== ========
The accompanying notes are an integral part of these financial statements.
4
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 1. Financial Statements
Condensed Income Statements
Nine Month Periods Ended September 30, 2002 and 2001
(In Thousands, Except Per Share Data)
(Unaudited)
2002 2001
Revenues:
Sales of oil and gas $ 73,289 $ 80,868
Sales of electricity 20,963 28,088
Interest and other income, net 1,616 2,106
-------- --------
95,868 111,062
-------- --------
Expenses:
Operating costs - oil and gas production 30,381 31,567
Operating costs - electricity generation 20,631 27,890
Depreciation, depletion and amortization 12,396 12,538
General and administrative 6,171 5,482
Write-off (recovery) of electricity receivable (3,631) 6,645
Interest 863 3,271
-------- --------
66,811 87,393
-------- --------
Income before income taxes 29,057 23,669
Provision for income taxes 6,023 5,780
-------- --------
Net income $ 23,034 $ 17,889
======== ========
Basic net income per share $ 1.06 $ .81
======== ========
Diluted net income per share $ 1.05 $ .81
======== ========
Cash dividends per share $ .30 $ .30
======== ========
Weighted average number of shares of
capital stock outstanding used to
calculate basic net income per share 21,738 22,035
Effect of dilutive securities:
Stock options 149 57
Other 40 21
-------- --------
Weighted average number of shares of
capital stock used to calculate
diluted net income per share 21,927 22,113
======== =========
The accompanying notes are an integral part of these financial statements.
5
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 1. Financial Statements
Condensed Statements of Comprehensive Income
Nine Month Periods Ended September 30, 2002 and 2001
(In Thousands)
(Unaudited)
2002 2001
Net income $ 23,034 $ 17,889
Unrealized losses on derivatives, net of
income taxes of $1,968 and $4,413 (2,953) (6,620)
Reclassification of realized gains
included in net income - (441)
-------- --------
Comprehensive income $ 20,081 $ 10,828
======== ========
The accompanying notes are an integral part of these financial statements.
6
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 1. Financial Statements
Condensed Statements of Cash Flows
Nine Month Periods Ended September 30, 2002 and 2001
(In Thousands)
(Unaudited)
2002 2001
Cash flows from operating activities:
Net income $ 23,034 $ 17,889
Depreciation, depletion and amortization 12,396 12,538
Deferred income tax liability 1,414 1,913
Other, net (258) 285
-------- --------
Net working capital provided by
operating activities 36,586 32,625
Decrease in accounts receivable, prepaid
expenses and other 2,801 7,354
Increase (decrease) in current liabilities 2,567 (11,090)
-------- --------
Net cash provided by operating activities 41,954 28,889
Cash flows from investing activities:
Capital expenditures and acquisitions (22,527) (11,349)
Other, net (44) 131
-------- --------
Net cash used in investing activities (22,571) (11,218)
Cash flows from financing activities:
Proceeds from issuance of long-term debt - 45,000
Payment of long-term debt (12,000) (37,000)
Dividends paid (6,522) (6,611)
Other, net (238) (714)
-------- --------
Net cash (used in) provided by
financing activities (18,760) 675
-------- --------
Net increase in cash and cash equivalents 623 18,346
Cash and cash equivalents at beginning of
year 7,238 2,731
-------- --------
Cash and cash equivalents at end of period $ 7,861 $ 21,077
======== ========
Supplemental non-cash activity:
Decrease in fair value of derivatives:
Current (net of income taxes of $1,857 and
$1,148 in 2002 and 2001, respectively) $ 2,786 $ 1,723
Non-current (net of income taxes of $111
and $3,265 in 2002 and 2001, respectively) 167 4,897
Net decrease to accumulated other -------- --------
comprehensive income $ 2,953 $ 6,620
======== ========
The accompanying notes are an integral part of these financial statements.
7
Berry Petroleum Company
Part I. Financial Information
Notes to Condensed Financial Statements
September 30, 2002
(Unaudited)
1. All adjustments which are, in the opinion of management, necessary
for a fair presentation of the Company's financial position at September
30, 2002 and December 31, 2001 and results of operations for the three
and nine month periods ended September 30, 2002 and 2001 and cash flows
for the nine month periods ended September 30, 2002 and 2001 have been
included. All such adjustments are of a normal recurring nature. The
results of operations and cash flows are not necessarily indicative of
the results for a full year.
2. The accompanying unaudited financial statements have been prepared
on a basis consistent with the accounting principles and policies
reflected in the December 31, 2001 financial statements. The December
31, 2001 Form 10-K and the Form 10-Q's for the periods ended June 30,
2002 and March 31, 2002 should be read in conjunction herewith. The
year-end condensed balance sheet was derived from audited financial
statements, but does not include all disclosures required by accounting
principles generally accepted in the United States of America.
8
BERRY PETROLEUM COMPANY
Part I. Financial Information
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Results of Operations
Net income for the third quarter of 2002 was $7.6 million, or $.35 per
share, on revenues of $35.3 million, up 29% from $5.9 million, or $.27 per
share, on revenues of $33.1 million in the third quarter of 2001 and up 12%
from $6.8 million, or $.31 per share, on revenues of $33.2 million in the
second quarter of 2002. Net income for the first nine months of 2002 was
$23.0 million, or $1.06 per share (basic), on revenues of $95.9 million, up
28% from $17.9 million, or $.81 per share, on revenues of $111.1 million,
for the first nine months of 2001. Pre-tax income in the first nine months
of 2002 included the recovery of $3.6 million of the $6.6 million in
electricity receivables which was written off in the first quarter of 2001.
Three Months Ended Nine Months Ended
Sept 30, June 30, Sept 30, Sept 30, Sept 30,
2002 2002 2001 2002 2001
Oil and gas:
Net production - BOE per day 14,464 14,060 12,940 14,110 13,938
Per BOE:
Realized sales price (1) $21.03 $19.99 $19.91 $19.02 $21.43
Operating costs (2) 8.06 7.96 7.63 7.35 7.83
Production taxes .51 .55 .57 .54 .47
----- ----- ----- ----- -----
Total operating costs 8.57 8.51 8.20 7.89 8.30
Depreciation/Depletion (DD&A) 3.10 3.34 3.25 3.22 3.30
General & administrative
expenses(G&A) 1.71 1.59 1.30 1.60 1.44
Interest expense .13 .20 .81 .22 .86
Electricity:
Production - Mwh day 2,088 1,935 1,921 2,025 1,119
Sales - Mwh/day 1,918 1,748 1,835 1,852 1,052
Average sales price - $/Mwh $37.59 $39.46 $56.89 $38.54 $62.85
Other:
Fuel gas cost per Mmbtu 3.02 2.97 3.75 2.83 7.99
BOE = barrel of oil equivalent
Mwh = Megawatt hour
(1)Includes realized hedging losses per BOE of $1.19, $.51 and $.58 for
the three months ended September 30, 2002, June 30, 2002 and nine months
ended September 30, 2002, respectively. Excludes unrealized hedging
losses of $.99 and $.01 for the three and nine months ended September
30, 2001, respectively. The impacts of unrealized gains and losses are
a result of the application of FAS 133.
(2)Includes expenses in excess of revenues from cogeneration operations
of $1.69, $1.73 and $1.48 for the third quarter of 2002, the second
quarter of 2002 and the third quarter of 2001, respectively. For the
first nine months of 2002 and 2001, respectively, these expenses
represent $1.26 and $1.61.
9
Operating income from oil and gas operations was $12.6 million and
$30.8 million for the three and nine months ended September 30, 2002.
These results were $3.7 million, or 42%, higher than $8.9 million earned in
the third quarter of 2001 and $6.2 million, or 17%, lower than $37.2
million earned for the first nine months of 2001. The primary reasons for
the increase in the third quarter of 2002 were higher production and higher
realized oil prices. For the nine months ended September 30, 2002,
operating income declined primarily due to lower oil prices, partially
offset by higher production and lower operating costs.
Oil and gas production (BOE/day) in the third quarter of 2002
increased to 14,464, up 12% from 12,940 in the third quarter of 2001 and up
3% from 14,060 in the second quarter of 2002. Production for the first
nine months of 2002 was 14,110, up slightly from 13,938 for the same period
of 2001. Production for the week ended October 31, 2002 averaged
approximately 14,800 BOE/day and the Company is forecasting an exit rate
for 2002 of approximately 15,500 BOE/day. The Company is experiencing
higher production levels due to the implementation of its capital budget
and renewed steaming operations in 2002. As of October 31, 2002, the
Company had drilled and completed 36 vertical and 14 horizontal producing
wells on the Company's operated properties in California. Many of these
wells have completed their first steam cycle and are contributing to the
increase in production. To complete the Company's 2002 capital budget
program, the Company plans to drill an additional 13 vertical and 3
horizontal producing wells in California in the fourth quarter of 2002
which should contribute to further increases in production for the fourth
quarter of this year and into 2003. In addition to newly drilled producing
wells, the Company increased its steam injection to approximately 62,500
barrels per day (B/D) for the third quarter of 2002 and 59,600 B/D for the
nine months ended September 30, 2002, up 33% from 47,000 B/D in the third
quarter of 2001 and 121% from an average of 27,000 B/D for the nine months
ended September 30, 2001. These efforts should result in production
improvements in the upcoming quarters.
The average realized sales price for the third quarter of 2002 was
$21.03, up from $19.91 in the third quarter of 2001 and $19.99 in the
second quarter of 2002. For the nine months ended September 30, 2002, the
average realized price was $19.02, down from $21.43 for the comparable
period of 2001. The realized prices for 2002 included realized hedging
losses of $1.19, $.51 and $.58 for the three months ended September 30,
2002, June 30, 2002 and the nine months ended September 30, 2002. These
losses relate to cash payments on the hedges put in place by the Company
for protection against large decreases in the price of crude oil. The
Company has preferred bracketed zero-cost collars as they meet the
Company's objectives of retaining significant upside while being adequately
protected on a significant downside price movement.
10
The following table summarizes the oil hedges in place as of September 30,
2002:
Crude Oil Hedges
(Based on Nymex WTI Pricing)
Barrels Floor Ceiling
Term Per Day Sell Put Buy Put Sell Call Buy Call
04/01/2002 - 2,500 - $20.00 $24.10 -
03/31/2003
04/01/2002 - 2,500 $17.60 $21.60 $25.55 $30.00
03/31/2003
01/01/2003 - 1,500 $19.00 $23.00 $27.00 $30.85
12/31/2003
04/01/2003 - 2,500 $18.25 $22.10 $25.40 $30.10
03/31/2004
04/01/2003 - 2,500 $18.25 $22.10 $25.45 $30.10
03/31/2004
Payments to our counterparties are triggered when Nymex monthly
average prices are between the Ceiling Sell Call and Buy Call prices. With
Nymex pricing averaging $28.27 for the third quarter, which was in excess
of the hedge Ceiling Sell Call prices, payments related to these hedges
were triggered resulting in the hedging losses detailed above.
Operating costs for the third quarter were $11.4 million, or $8.57 per
BOE, up from $9.8 million, or $8.20 per BOE, in the third quarter of 2001.
Operating costs for the first nine months of 2002 were $30.4 million, or
$7.89 per BOE, down from $31.6 million, or $8.30 per BOE, for the first
nine months of 2001. The Company has made enhancements in field operations
to stabilize non-steam related operating costs such as oil treating
consolidation and the conversion of many of the Company's producing
properties' electrical requirements to cogeneration power rather than
purchasing electricity from the utilities.
The cost of steaming is directly affected by the sales price received
for the electricity produced from the Company's cogeneration operations and
the cost of natural gas used as fuel in the Company's steam generation
operations. Revenues from electricity sales declined in the first nine
months of 2002 from the same 2001 period as the Company was unable to
achieve sales prices in the open market that were comparable to its
previous contractual sales prices with major utilities. The average price
per Mwh received for the Company's electricity was approximately $39 in the
first nine months of 2002, down from approximately $63 received during the
same 2001 period. The cost of natural gas per Mmbtu was unusually high in
the first nine months of 2001 at $7.99/Mmbtu. This was significantly
higher than the $2.83/Mmbtu incurred in the first nine months of 2002.
However, the cost of natural gas remains volatile and based on Nymex strip
prices, it is estimated that the Company's cost of natural gas purchased in
the fourth quarter of 2002 and for 2003 will range between $3.50 and
$4.20/Mmbtu.
11
To protect a portion of the Company's electrical production from low
off-peak power prices, the Company entered into the following fixed price
sale (swap) agreements:
Electricity Hedges
(Based on Dow Jones SP15 Index)
Swap
Term Volume Price
10/1/02 - 12/31/02 30 Mwh per off-peak hour $21.25
1/1/03 - 3/31/03 30 Mwh per off-peak hour $22.50
4/1/03 - 5/31/03 30 Mwh per off-peak hour $21.00
One of the Company's principal goals for the upcoming quarters will be
to lower the cost of producing steam for its oil and gas operations. On
August 22, 2002, the California Public Utilities Commission mandated that
investor owned utilities offer Standard Offer contracts to certain
qualified facilities. The Company meets the requirements and is attempting
to have these contracts with Southern California Edison Company and Pacific
Gas and Electric Company in effect by January 1, 2003. Once executed,
these contracts should result in improved electrical pricing which would
contribute to lower operating costs for the Company's crude oil production
operations. These contracts will expire no later than December 31, 2003.
G&A for the third quarter was $2.3 million, up 53% from $1.5 million
in the third quarter of 2001 and 15% from $2.0 million in the second
quarter of 2002. The increase in the third quarter of 2002 compared to the
third quarter of 2001 was primarily due to the hiring of additional
technical employees to assist in property development and the pursuit of
acquisition opportunities, and higher insurance and property evaluation
costs. G&A for the nine months ended September 30, 2002 was 13% higher
than the first nine months of 2001 due to higher insurance costs, property
evaluation and rent expense, partially offset by lower legal fees.
The Company experienced an effective tax rate of 25% in the third
quarter of 2002 and 21% in the first nine months of 2002 compared to 21%
and 24% in the same three and nine month 2001 periods, respectively. The
Company continues to invest in qualifying enhanced oil recovery (EOR)
projects and anticipates that it will continue to earn EOR tax credits.
This is the primary reason that the Company's effective tax rate is below
the statutory tax rate.
Liquidity and Capital Resources
Working capital at September 30, 2002 was negative $1.6 million, down
from $18.3 million at September 30, 2001 and $5.8 million, at December 31,
2001. Cash generated from operations for the first nine months of 2002 was
$42.0 million, up 45% from $28.9 million for the first nine months of 2001.
For the 2002 period, cash was used for a total of $22.5 million in capital
expenditures and leasehold acquisitions, $12.0 million to repay long-term
debt and $6.5 million in dividends.
The Company's capital budget plan has been expanded and now calls for
the commitment of $31.5 million. As of October 31, 2002, 36 vertical
producing wells and 14 horizontal producing wells have been drilled on the
Company's operated
12
properties in California. For all of 2002, the plan
calls for a total of 49 vertical and 17 horizontal producing wells and 68
workovers on its California properties. Also, the Company has acquired an
extensive acreage position in two states consisting of approximately
182,000 acres in northeastern Kansas and 44,000 acres in southern Illinois.
As part of the capital budget, the Company has also drilled a five well
coal bed methane (CBM) pilot in Illinois, and commenced drilling one of two
pilots on its Kansas acreage and expects to drill a second pilot by year-
end. It is anticipated that the pilot programs will verify the gas content
and permeabilities of the coal, and thus its economic potential. The
Company's goal is to determine by mid-to-late 2003 if full development is
commercial, at which time the Company could begin full exploitation.
Forward Looking Statements
"Safe harbor under the Private Securities Litigation Reform Act of 1995:"
With the exception of historical information, the matters discussed in this
Form 10-Q are forward-looking statements that involve risks and
uncertainties. Although the Company believes that its expectations are
based on reasonable assumptions, it can give no assurance that its goals
will be achieved. Important factors that could cause actual results to
differ materially from those in the forward-looking statements herein
include, but are not limited to, the timing and extent of changes in
commodity prices for oil, gas and electricity, a limited marketplace for
electricity sales within California, counterparty risk, competition,
environmental risks, litigation uncertainties, drilling, development and
operating risks, the availability of drilling rigs and other support
services, legislative and/or judicial decisions and other government
regulations.
13
BERRY PETROLEUM COMPANY
Part II. Other Information
Item 4. Controls and Procedures
The Company's Chief Executive Officer and its Chief Financial
Officer have evaluated the Company's disclosure controls and procedures
within 90 days of the filing of this report pursuant to Rule 13a-14 of the
Securities and Exchange Act of 1934 and have concluded that there are no
significant deficiencies or material weaknesses. There have been no
significant changes in the Company's internal controls or in other factors
that could significantly affect these controls.
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) See Exhibit Index.
SIGNATURE
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.
BERRY PETROLEUM COMPANY
/s/ Donald A. Dale
Donald A. Dale
Controller
(Principal Accounting Officer)
Date: November 12, 2002
14
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Jerry V. Hoffman, Chairman, President and Chief Executive Officer of
Berry Petroleum Company, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Berry Petroleum
Company;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant is made known to us by others within
the registrant, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
Date: November 12, 2002
/s/ Jerry V. Hoffman
Jerry V. Hoffman
Chairman, President and
Chief Executive Officer
15
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Ralph J. Goehring, Senior Vice President and Chief Financial Officer of
Berry Petroleum Company, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Berry Petroleum
Company;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant is made known to us by others within
the registrant, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
Date: November 12, 2002
/s/ Ralph J. Goehring
Ralph J. Goehring
Senior Vice President and
Chief Financial Officer
16
EXHIBIT INDEX
Exhibit No. Description
99.1 Certification of Chief Executive Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
99.2 Certification of Chief Financial Officer pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
17
Exhibit 99.1
Certification of CEO Pursuant to
18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of Berry Petroleum
Company (the "Company") on Form 10-Q for the period ending
September 30, 2002 as filed with the Securities and Exchange
Commission on November 12, 2002 (the "Report"), Jerry V. Hoffman,
as Chairman and Chief Executive Officer of the Company, hereby
certifies, pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the
best of his knowledge, 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 result of
operations of the Company.
/s/ Jerry V. Hoffman
Jerry V. Hoffman
Chairman, President and Chief Executive Officer
November 12, 2002
This certification accompanies this Report pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed
filed by the Company for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended.
Exhibit 99.2
Certification of CFO Pursuant to
18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of Berry Petroleum
Company (the "Company") on Form 10-Q for the period ending
September 30, 2002 as filed with the Securities and Exchange
Commission on November 12, 2002 (the "Report"), Ralph J.
Goehring, Chief Financial Officer of the Company, hereby
certifies, pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the
best of his knowledge, 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 result of
operations of the Company.
/s/ Ralph J. Goehring
Ralph J. Goehring
Senior Vice President and Chief Financial Officer
November 12, 2002
This certification accompanies this Report pursuant to Section
906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed
filed by the Company for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended.