UNITED STATES
                                               
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form 10-K

MARK ONE
  X     ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934 [FEE REQUIRED] 

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995

  __    TRANSITION  REPORT PURSUANT  TO SECTION  13 or  15(d) OF  THE SECURITIES
        EXCHANGE ACT OF 1934

              COMMISSION FILE NUMBER 0-11313                       
                 -----------------------

                         MAY DRILLING PARTNERSHIP 1983-3
                         MAY LIMITED PARTNERSHIP 1983-3
             (Exact name of registrant as specified in its charter)
                                                    
                            ------------------------


                                                         75-1915681       
       TEXAS                                             75-1915685       
 (State or other jurisdiction of                      (I.R.S. Employer    
 incorporation or organization)                     Identification Number)
   4582 SOUTH ULSTER STREET PARKWAY
       SUITE 1700
     DENVER, COLORADO                                        80237        
 (Address of principal executive offices)                  (Zip Code)     

       Registrant's telephone number, including area code:  (303) 850-7373

           SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:


                                           Name of each exchange
 Title of each class                       on which registered  
 -------------------                     ----------------------
      NONE                             NONE          

           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                     Units of Participation, $1,000 Per Unit
                                (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding  12 months (or  for such  shorter period that  the registrant  was
required  to  file such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.  Yes  X   No  ___

Indicate  by check mark if disclosure of  delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of  registrant's  knowledge,  in  definitive  proxy  or  information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  X



                      DOCUMENTS INCORPORATED BY REFERENCE:

 DOCUMENT                                  PART OF FORM
 --------                                  10-K INTO
                                           WHICH IT IS
                                           -----------
                                           INCORPORATED
 The General Partnership
 Agreement and the Limited
 Partnership Agreement filed as            Part IV
 an Exhibit to Registration
 Statement No. 0-11313


                                     PART I
                                     ------


ITEM 1 - BUSINESS

May  Drilling Partnership 1983-3 (the "Drilling or General Partnership") and May
Limited Partnership  1983-3 (the "Limited  Partnership") were  organized by  May
Petroleum  Inc.   ("May")  to  explore  for and  develop  oil  and gas  reserves
primarily in  Texas, Oklahoma and Louisiana.   Funds received from  the sale and
production of  oil and  gas reserves  are used  to  pay the  obligations of  the
Limited  Partnership.  Funds not required  by the Limited Partnership as working
capital are distributed to the participants in the Drilling Partnership and  the
general partner. 

The general partner of the Limited Partnership is EDP Operating,  Ltd., which is
one of the operating partnerships  for Hallwood Energy Partners, L. P.  ("HEP").
The Drilling Partnership is the sole limited partner of the Limited Partnership.
The Limited  Partnership does not have  any subsidiaries, nor does  it engage in
any other kind  of business.   The Limited Partnership has  no employees and  is
operated by  Hallwood Petroleum, Inc. ("HPI"), a subsidiary of HEP.  In February
1996, HPI employed 133 full-time employees. 

Pursuant  to the  terms of  the  general partnership  agreement and  the limited
partnership  agreement, HEP  is  obligated, from  time  to time,  to  contribute
certain  amounts, in  property, cash  or unreimbursed  services, to  the Limited
Partnership.   As of December 31, 1995, all such required contributions had been
made.

PARTICIPATION IN EXPENSES AND REVENUES 

The principal expenses and revenues of the Limited Partnership are shared by the
general  partner  and the  Drilling Partnership  as set  forth in  the following
table.  The charges and credits to participants in the  Drilling Partnership are
shared  among the  participants in  proportion  to their  ownership of  units of
participation.

<TABLE>
<CAPTION>

                                  Drilling       General
                                 Partnership     Partner
                                 -----------     -------
 <S>                                 <C>           <C> 
 Abandonment expenses (1)            99%            1%
 Noncapital expenses                 99%            1%
 Direct expenses                     99%            1%
 Lease acquisition expenses           -            100%
 Capital expenses                     -            100%
 Oil and gas revenues                (2)           (2)
 Operating expenses                  (2)           (2)
 Special projects                    (2)           (2)
 General and administrative
 overhead                            (2)           (2)

<F1>
  (1) Includes   expenses  that  would  otherwise  be  allocated  as  lease
      acquisition expenses  and/or  capital  expenses  but that  relate  to
      abandoned properties.
<F2>
  (2) Such items were shared 70% by the Drilling Partnership and 30% by the
      general partner until December 31, 1984.  As of December 31, 1984 and
      as of December 31 of each year thereafter, the sharing of  such items
      is  adjusted so  the   general  partner's allocation  will equal  the
      percentage  that the amount of Limited Partnership expenses allocated
      to  the general  partner bears  to  the aggregate  amount of  Limited
      Partnership  expenses  allocated  to  the  general  partner  and  the
      Drilling Partnership, plus 15 percentage points, but in no event will
      the general partner's allocation exceed  50%.  The sharing  ratio for
      each of the last three years was:


<CAPTION>
                       1995      1994      1993 
                       ------    ------    ------
 <S>                   <C>       <C>       <C> 
 Limited Partner       57.9%     58.1%     58.6%
 General Partner       42.1%     41.9%     41.4%
</TABLE>

In 1996, the sharing ratio will be 57.7% to the limited partner and 42.3% to the
general partner.

To  the  extent  that  the  characterization  of  any  expense  of  the  Limited
Partnership  depends on its deductibility  for federal income  tax purposes, the
proper characterization is determined  by the general partner (according  to its
intended  characterization  on the  Limited  Partnership's  federal  income  tax
return) in  good faith at  the time the  expense is to  be charged  or credited.
Such characterization will control  related charges and credits to  the partners
regardless of any  subsequent determination by the Internal Revenue Service or a
court of  law that the reported  expenses should be otherwise  characterized for
tax purposes.

COMPETITION 

Oil and  gas must  compete with  coal, atomic  energy, hydro-electric power  and
other forms  of energy.   See also  "Marketing" for a  discussion of  the market
structure for oil and gas sales. 

REGULATION 

Production and sale of oil  and gas is subject to federal and state governmental
regulations in a variety of ways including environmental regulations, labor law,
interstate  sales,  excise taxes  and federal,  state  and Indian  lands royalty
payments.    Failure  to comply  with  these regulations  may  result  in fines,
cancellation of  licenses to do business  and cancellation of  federal, state or
Indian leases.

The production of oil  and gas is subject to regulation by  the state regulatory
agencies in the states  in which the Limited  Partnership does business.   These
agencies make and  enforce regulations to  prevent waste of  oil and gas and  to
protect  the rights of owners  to produce oil  and gas from  a common reservoir.
The regulatory agencies regulate the amount of oil and gas produced by assigning
allowable production rates to wells capable of producing oil and gas.

FEDERAL INCOME TAX CONSIDERATIONS 
                                  
The Limited Partnership and the General Partnership are partnerships for federal
income tax purposes.   Consequently, they are not  taxable entities; rather, all
income, gains,  losses, deductions and credits are passed through and taken into
account  by the  partners on their  individual federal  income tax  returns.  In
general, distributions are  not subject to tax so long  as such distributions do
not exceed the partner's adjusted tax basis.  Any distributions in excess of the
partner's adjusted tax basis are taxed generally as capital gains.

MARKETING 

The oil  and gas produced from  the properties owned by  the Limited Partnership
has typically  been marketed through normal channels for such products.  Oil has
generally been  sold  to purchasers  at  field prices  posted  by the  principal
purchasers of crude oil in the areas where the producing properties are located.
The  majority of the  Limited Partnership's gas  production is sold  on the spot
market and is transported in intrastate and interstate pipelines.   Both oil and
natural gas are purchased  by refineries, major oil companies,  public utilities
and other users and processors of petroleum products.  

Factors  which,  if they  were  to  occur, might  adversely  affect the  Limited
Partnership  include decreases  in oil  and gas  prices, the  availability of  a
market  for production,  rising  operational costs  of  producing oil  and  gas,
compliance with  and changes in  environmental control  statutes and  increasing
costs and difficulties of transportation.  

SIGNIFICANT CUSTOMER 

For the years ended December 31, 1995, 1994 and 1993, purchases by the following
company  exceeded  10%  of  the  total  oil and  gas  revenues  of  the  Limited
Partnership: 

<TABLE>
<CAPTION>
                       1995      1994      1993 
                       ------    ------    ------
 <S>                    <C>       <C>       <C>
 Conoco Inc.            94%       62%       74%
</TABLE>


Although  the Limited Partnership  sells the majority  of its  production to one
purchaser, there  are numerous other purchasers in the  area, so the loss of its
significant  customer  would  not  adversely  affect  the Limited  Partnership's
operations.

ENVIRONMENTAL CONSIDERATIONS 

The  exploration for, and  development of, oil  and gas involve  the extraction,
production and transportation of materials which,  under certain conditions, can
be hazardous  or can cause  environmental pollution problems.   In light  of the
present general interest  in environmental problems, the general  partner cannot
predict what effect  possible future public  or private action  may have on  the
business of the Limited Partnership.  The general partner is  continually taking
all  action necessary  in its  operations to  ensure conformity  with applicable
federal,  state and  local  environmental  regulations  and does  not  presently
anticipate  that the  compliance  with federal,  state  and local  environmental
regulations  will have  a  material adverse  effect  upon capital  expenditures,
earnings  or the competitive position of the  Limited Partnership in the oil and
gas industry.

INSURANCE COVERAGE 

The Limited Partnership is subject to all the  risks inherent in the exploration
for,  and  development of,  oil  and gas,  including  blowouts, fires  and other
casualties.    The  Limited  Partnership  maintains  insurance  coverage  as  is
customary for  entities of a similar  size engaged in operations  similar to the
Limited Partnership's, but losses can occur from uninsurable risks or in amounts
in excess of  existing insurance coverage.  The occurrence of  an event which is
not insured  or not fully insured could have  an adverse impact upon the Limited
Partnership's earnings and financial position.


ITEM 2 - PROPERTIES

The Limited Partnership's oil and gas  reserves are concentrated in prospects in
south Louisiana.  The  Limited Partnership's reserves are predominantly  natural
gas, which  accounts for 86% of  estimated future gross revenues  in the Limited
Partnership's reserve report as of December 31, 1995.

SIGNIFICANT PROSPECTS 

At December 31, 1995, the following prospects accounted for approximately 97% of
the Limited Partnership's proved oil and gas reserves.  Reserve  quantities were
obtained from the December  31, 1995 reserve report prepared  by HPI's petroleum
engineers.


BOUDREAUX  PROSPECT.   The Boudreaux  prospect is  located in  Lafayette Parish,
Louisiana.  The Limited Partnership's interest in the prospect has remaining net
proved reserves of 36,800 bbls  of oil and 1,711,000  mcf of gas as of  December
31, 1995, all of  which are developed and producing  at December 31, 1995.   The
Limited Partnership's working interest in this prospect ranges up to 3.5%.

MEAUX PROSPECT.   The Meaux prospect is  located in Lafayette Parish, Louisiana.
The  Limited Partnership's  interest in  the prospect  has remaining  net proved
reserves of 800 bbls  of oil and 77,000 mcf of gas as  of December 31, 1995, all
of  which   are  developed and  producing at  December  31, 1995.   The  Limited
Partnership's working interest in this prospect is 19.8%.


ITEM 3 - LEGAL PROCEEDINGS

For a description of legal proceedings affecting the Limited Partnership, please
refer to Item 8 - Note 3.


ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF STOCKHOLDERS

No matter was submitted to a vote  of participants during the fourth quarter  of
1995.


                                     PART II
                                     -------


ITEM 5 - MARKET  FOR THE  REGISTRANT'S COMMON  EQUITY  AND RELATED  STOCKHOLDERS
         MATTERS

  a) The registrant's  securities consist of partnership  interests which are
     not traded on any exchange and  for which no established public  trading
     market exists.

  b) As of December  31, 1995, there were approximately 776 holders of record
     of partnership interests in the Drilling Partnership.

  c) Distributions  paid  by the  Limited  Partnership  were  as follows  (in
     thousands):
<TABLE>
<CAPTION>
            General   Limited
            Partner   Partner
            -------   -------
   <S>      <C>      <C>     
   1995    $144      $144
   1994     386       542
   1993     145       205
</TABLE>


ITEM 6 - SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
                               For the Limited Partnership
                           As of or for the Year Ended December 31,
                     ---------------------------------------------- 
                      1995      1994      1993       1992      1991 
                    ------     ------    ------    ------     ------

                                     (In thousands)
 <S>               <C>       <C>        <C>       <C>       <C>   
 Total revenues    $  628    $  661     $1,183    $1,230    $  819
 Oil and gas
 revenues             619       648      1,170     1,221       809
 Net income           255       282        339       679       297
 Working capital      316       258        779       646       489
 Total assets       1,110     1,150      2,117     1,809     2,012
 Partners'
 capital            1,084     1,117      1,763     1,774     1,911
</TABLE>


ITEM 7 - MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF   FINANCIAL  CONDITION  AND
         RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES 

Material  changes in the Limited Partnership's cash position for the years ended
December 31, 1995 and 1994 are summarized as follows:

<TABLE>
<CAPTION>
                                   1995         1994 
                                 ------       ------
                                    (In thousands)
 <S>                             <C>          <C>   
 Cash provided by operating      $  293       $  552
 activities
 Distributions to partners         (288)        (928)
 Additions to oil and gas
 properties                         (39)          (9)
 Proceeds from sale of oil
 and gas properties                               16
                                -------      -------
 Decrease in cash                $  (34)      $ (369)

</TABLE>


Cash provided by operating activities in 1995 was used for distributions to  the
partners and additions to oil  and gas properties.  The Limited  Partnership has
net working capital of $316,000.  This working capital, together with future net
cash  flows generated from operations may  be used to fund future distributions.
Future distributions depend on,  among other things, continuation of  current or
higher oil  and gas prices, markets for production and future development costs,
and the outcome of the litigation described in Item 8, Note 3.

The Limited Partnership's ability to generate funds adequate  to meet its future
needs will be largely dependent upon its ability to continue  to develop further
its  existing  reserves.   Proved reserves  and  discounted future  net revenues
(discounted at 10% and  before general and administrative expenses)  from proved
reserves were estimated at 39,000 bbls and 1,844,000 mcf valued at $3,206,000 in
1995  and 39,000  bbls and  1,870,000 mcf  valued  at $2,872,000  in 1994.   The
increase in discounted future net revenues and the fluctuation in the quantities
resulted from an increase in  year end oil and gas prices as well  as changes in
the estimated rates of production on certain wells. 

During 1995,  the  Financial  Accounting Standards  Board  issued  Statement  of
Financial Accounting Standards No.  121 "Accounting for the Impairment  of Long-
Lived  Assets and for Long-Lived Assets  to be Disposed Of"  ("SFAS 121").  SFAS
121  provides the standards for  accounting for the  impairment of various long-
lived assets.   The Limited Partnership is  required to adopt SFAS  121 no later
than 1996.  The Limited Partnership uses the full cost method of  accounting for
its only long-lived  assets, which requires  an impairment  to be recorded  when
total  capitalized costs  exceed  the  present  value,  discounted  at  10%,  of
estimated future  net revenues from proved oil and gas reserves.  Therefore, the
adoption of SFAS 121 is not expected to have  a material effect on the financial
position or results of operations of the Limited Partnership.

RESULTS OF OPERATIONS
---------------------

1995 COMPARED TO 1994
---------------------

OIL REVENUE

Oil revenue increased $11,000 during  1995 as compared with 1994.   The increase
is comprised of an increase  in the average oil price from $16.03  per barrel in
1994 to  $17.68 per barrel in 1995 combined with  a 2% increase in production as
shown in the table below.  The increase in  production is due to increased state
allowable production limits, partially  offset by normal production  declines as
well as the  temporary abandonment of  one well and sale  of another during  the
second quarter of 1994.

GAS REVENUE

Gas  revenue decreased $40,000 during 1995 as  compared with 1994.  The decrease
is due to a decrease in the average  gas price from $2.15 per mcf during 1994 to
$1.84  per mcf during 1995, partially offset  by an 8% increase in production as
shown below.   The increase in  production is due  to increased state  allowable
production limits, partially offset by normal production declines as well as the
temporary abandonment  of one well  and the  sale of another  during the  second
quarter of 1994.

The  following table summarizes  the Limited  Partnership's share  of production
from the Limited Partnership's significant properties for 1995 and 1994.

<TABLE>
<CAPTION>
                                          Net Production          
                             ----------------------------------
                                   1995                   1994     
                             --------------         --------------
                             Oil         Gas        Oil         Gas
 County, State and Well     (Bbls)      (Mcf)      (Bbls)      (Mcf)
 ----------------------      ----       ---         ----       ---
 <S>                      <C>         <C>         <C>         <C>   
  Lafayette, Louisiana
   --------------------
    Hutchinson #1            142      25,750        165       32,188
    Meaux Prospect
     --------------
    Richard #1               410      36,876        480       42,223
    Warwick Richard #1         -           -         44        2,343
    Middle Bayou Cannes
     -------------------

    Duhon #1                   -           -         67        4,058
    Boudreaux Prospect
     ------------------
    A. L. Boudreaux #1     4,419     209,316      4,085      170,357
    G. S. Boudreaux
    Estate #1                 85       4,352         74        3,626
    Hallwood Fontenot #1      11       1,368          4          510

  Other Properties           398       5,245        463        5,964
                           -----     -------      -----      -------
    Total Net Production   5,465     282,907      5,382      261,269
                           =====     =======      =====      =======
</TABLE>


LEASE OPERATING

Lease  operating expense  decreased $23,000  during 1995  as compared  with 1994
primarily due to the sale of the Warwick Richard #1 during the second quarter of
1994 and the temporary abandonment of the Duhon #1.

PRODUCTION TAXES

Production taxes increased $16,000 during 1995 as compared with 1994 as a result
of the settlement  of a lawsuit which resulted in  lower production taxes during
1994.

GENERAL AND ADMINISTRATIVE

General and administrative  expenses decreased $27,000  during 1995 as  compared
with 1994  due to  a decrease  in the  allocation of  overhead from  the general
partner.

DEPLETION

Depletion  expense increased $12,000 during 1995 as  compared with 1994 due to a
higher depletion rate caused by the 8% increase in oil and gas production during
1995.

LITIGATION SETTLEMENT

Litigation  settlement expense during 1995  primarily represents amounts paid in
connection with the settlement of a royalty dispute on the Duhon #1 well.

1994 COMPARED TO 1993
---------------------

OIL REVENUES

Oil revenues decreased  $61,000 in 1994  as compared to  1993.  The average  oil
price  decreased from $17.88 per  barrel in 1993  to $16.03 per  barrel in 1994.
Oil production decreased 36% as  shown in the table below, primarily  due to the
reduction in state  allowable production  limits, as well  as normal  production
declines.<PAGE>
GAS REVENUES

Gas revenues  decreased $461,000 as  compared to  1993.  The  average gas  price
decreased from $2.26 per mcf  in 1993 to $2.15 per mcf in 1994.   Gas production
decreased 42%  as shown in  the table below,  primarily due to the  reduction in
state allowable production limits, as well as normal production declines.


The  following table summarizes  the Limited  Partnership's share  of production
from the Limited Partnership's significant properties for 1994 and 1993.

<TABLE>
<CAPTION>
                                         Net Production          
                             ----------------------------------
                                   1994                   1993     
                             --------------         --------------
                             Oil         Gas        Oil         Gas
 County, State and Well     (Bbls)      (Mcf)      (Bbls)      (Mcf)
 ----------------------      ----       ---         ----       ---
 <S>                       <C>        <C>         <C>        <C>   
  Lafayette, Louisiana
   --------------------
    Hutchinson #1            165      32,188        693      80,408
    Meaux Prospect
     --------------

    Richard #1               480      42,223        532      41,907
    Warwick Richard #1        44       2,343         23      13,242
    Middle Bayou Cannes
     -------------------
    Duhon #1                  67       4,058        979      39,563
    Boudreaux Prospect
     ------------------
    A. L. Boudreaux #1     4,085     170,357      5,445     255,662
    G. S. Boudreaux
    Estate #1                 74       3,626         82       3,797
    Hallwood Fontenot #1       4         510         10       1,460

  Other Properties           463       5,964        598      15,268
                           -----     -------      -----     -------
    Total Net Production   5,382     261,269      8,362     451,307
                           =====     =======      =====     =======
</TABLE>


LEASE OPERATING 

Lease operating  expense decreased $14,000 as compared to 1993, primarily due to
the sale of the Warwick Richard #1 during the second quarter of 1994.

PRODUCTION TAXES

Production taxes decreased $45,000 in 1994 as compared to 1993, primarily due to
the decrease in revenues mentioned previously.

GENERAL AND ADMINISTRATIVE

General  and administrative  expenses decreased $26,000  in 1994  as compared to
1993, due to a decrease in allocation of overhead from the general partner.  

DEPLETION

Depletion  expense decreased  $68,000 as compared  to 1993,  primarily due  to a
lower depletion rate.<PAGE>
LITIGATION SETTLEMENT

Litigation  settlement expense  during 1993  represents the  costs of  a lawsuit
settlement which is discussed in Item 8 - Note 3 of this Form 10-K.


ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                          INDEX TO FINANCIAL STATEMENTS

                                                                            PAGE
                                                                            ----

FINANCIAL STATEMENTS:

  Independent Auditors' Report                                                12
              
  Balance Sheets at December 31, 1995 and 1994 - 
   May Drilling Partnership 1983-3                                            13

  Balance Sheets at December 31, 1995 and 1994 - 
   May Limited Partnership 1983-3                                             14

  Statements of Operations for the Years Ended
   December 31, 1995, 1994 and 1993 -
   May Limited Partnership 1983-3                                             15

  Statements of Changes in Partners' Capital for the
   Years Ended December 31, 1995, 1994 and 1993 -
   May Limited Partnership 1983-3                                             16

  Statements of Cash Flows for the Years Ended 
   December 31, 1995, 1994 and 1993 - 
   May Limited Partnership 1983-3                                             17

  Notes to Financial Statements - May Drilling Partnership 1983-3
   and May Limited Partnership 1983-3                                      18-21

SUPPLEMENTAL OIL AND GAS RESERVE INFORMATION (UNAUDITED)                      22




                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------


DRILLING PARTNERSHIP 1983-3 AND 
  MAY LIMITED PARTNERSHIP 1983-3:

We  have audited  the financial  statements of  May Drilling  Partnership 1983-3
("General   Partnership")   and   May  Limited   Partnership   1983-3  ("Limited
Partnership") as of December 31, 1995  and 1994 and for each of the  three years
in the period ended December 31, 1995, listed  in the accompanying index at Item
8.    These financial  statements are  the  responsibility of  the Partnerships'
management.   Our responsibility is  to express  an opinion  on these  financial
statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing  the  accounting principles  used  and significant  estimates  made by
management, as  well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In  our opinion,  such  financial statements  present  fairly, in  all  material
respects,  the financial  position of  the General  Partnership and  the Limited
Partnership at  December 31, 1995  and 1994, and  the results of  operations and
cash flows of  the Limited Partnership for each of the three years in the period
ended  December  31, 1995  in  conformity  with  generally  accepted  accounting
principles.  


DELOITTE & TOUCHE LLP

Denver, Colorado
February 27, 1996



                         MAY DRILLING PARTNERSHIP 1983-3
                                 BALANCE SHEETS
                                 (In thousands)

<TABLE>
<CAPTION>
                                     December 31,   December 31,
                                         1995            1994   
                                     ------------   ------------
 <S>                                    <C>            <C>   
 ASSETS
 Investment in May Limited               $613           $637
 Partnership 1983-3                       ===            ===


 PARTNERS' CAPITAL

 Partners' Capital                       $613           $637
                                          ===            ===
</TABLE>



Note: The  statements  of  operations  and  cash  flows  for May  Drilling
      Partnership 1983-3  are not  presented because  such information  is
      equal to the  Limited Partners' share of  such activity as presented
      in  the May  Limited Partnership  1983-3 financial  statements.  The
      May  Drilling Partnership  carries  its  investment in  May  Limited
      Partnership  1983-3  on  the   equity  method.    The   May  Limited
      Partnership   1983-3   financial  statements   should  be   read  in
      conjunction with this balance sheet.




                         MAY LIMITED PARTNERSHIP 1983-3
                                 BALANCE SHEETS
                                 (In thousands)

<TABLE>
<CAPTION>
                                     December 31,   December 31,
                                         1995            1994   
                                     ------------   ------------
 <S>                                  <C>            <C>     
 ASSETS
 CURRENT ASSETS
  Cash and cash equivalents           $    153       $    187
  Accrued oil and gas sales                150             93
  Due from affiliate                        39             11
                                        -------        -------

     Total                                 342            291
                                        -------        -------

 OIL AND GAS PROPERTIES, using the
  full cost method of accounting        16,509         16,470
    Less - Accumulated depletion       (15,741)       (15,611)
                                        -------        -------

     Net oil and gas properties            768            859
                                        -------        -------

 TOTAL ASSETS                         $  1,110       $  1,150
                                        =======        =======

 LIABILITIES AND PARTNERS' CAPITAL
 CURRENT LIABILITIES
  Accounts payable and accrued
  liabilities                         $     26       $     33
                                        -------        -------

 PARTNERS' CAPITAL
  General partner                          471            480
  Limited partner                          613            637
                                        -------        -------
     Total                               1,084          1,117
                                        -------        -------

 TOTAL LIABILITIES AND PARTNERS'      $  1,110       $  1,150
 CAPITAL                                =======        =======
</TABLE>




                         MAY LIMITED PARTNERSHIP 1983-3
                            STATEMENTS OF OPERATIONS
              FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
                        (In thousands, except for Units) 

<TABLE>
<CAPTION>
                                 1995        1994        1993  
                                --------    --------    --------
 <S>                           <C>        <C>         <C>    
 REVENUES
  Oil revenue                  $   97     $    86     $   147
  Gas revenue                     522         562       1,023
  Interest income                   9          13          13
                                ------      ------      ------
     Total                        628         661       1,183
                                ------      ------      ------

 COSTS AND EXPENSES
  Lease operating                  91         114         128
  Production taxes                 37          21          66
  General and administrative       93         120         146
  Depletion                       130         118         186
  Litigation settlement            13                     306
  Professional services and
  other                             9           6          12
                                ------      ------      ------
     Total                        373         379         844
                                ------      ------      ------

 NET INCOME                   $   255     $   282     $   339
                                ======      ======      ======

 ALLOCATION OF NET INCOME:
  General Partner             $   135     $   143     $   177
                                ======      ======      ======
  Limited Partner             $   120     $   139     $   162
                                ======      ======      ======

  Per initial $1,000 Limited 
    Partner investment        $ 10.32     $ 11.95     $ 13.93   
                                ======      ======      ====== 
  Weighted average initial   
    $1,000 Limited Partner   
    investment units         
    outstanding                11,629      11,629      11,629
                               =======     =======     =======
</TABLE>



                         MAY LIMITED PARTNERSHIP 1983-3
                   STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
              FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
                                 (In thousands)

<TABLE>
<CAPTION>
                                General     Limited
                                Partner     Partner      Total
                                -------     -------      -----
 <S>                          <C>         <C>         <C>    
 BALANCE, DECEMBER 31, 1992   $   691     $ 1,083     $ 1,774
  Net income                      177         162         339
  Distributions                  (145)       (205)       (350)
                                ------      ------      ------

 BALANCE, DECEMBER 31, 1993       723       1,040       1,763
  Net income                      143         139         282
  Distributions                  (386)       (542)       (928)
                                ------      ------      ------

 BALANCE, DECEMBER 31, 1994       480         637       1,117
  Net income                      135         120         255
  Distributions                  (144)       (144)       (288)
                                ------      ------      ------

 BALANCE, DECEMBER 31, 1995   $   471     $   613     $ 1,084
                                ======      ======      ======
</TABLE>




                         MAY LIMITED PARTNERSHIP 1983-3
                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
                                 (In thousands) 

<TABLE>
<CAPTION>
                                    1995        1994        1993  
                                   --------    --------    --------
 <S>                             <C>         <C>         <C>    
 OPERATING ACTIVITIES:
  Net income                     $   255     $   282     $   339
  Adjustment to reconcile net   
    income to net cash provided 
    by operating activities:
     Depletion                       130         118         186
                                   ------      ------      ------

       Cash from operations
       before working capital
       changes                       385         400         525


  Changes in assets and         
    liabilities provided (used) 
    cash:
    Accrued oil and gas sales        (57)        113          47
    Due from affiliate               (28)        360        (234)
    Accounts payable and        
      accrued liabilities             (7)       (321)        319
                                   ------      ------      ------
       Net cash provided by     
         operating activities        293         552         657
                                   ------      ------      ------

 INVESTING ACTIVITIES:
  Proceeds from sale of oil and 
    gas properties                                16          16
  Additions to oil and gas      
    properties                       (39)         (9)        (58)
                                   ------      ------      ------

       Net cash provided by     
         (used in) investing    
         activities                  (39)          7         (42)
                                   ------      ------      ------

 FINANCING ACTIVITIES:
  Distributions to partners         (288)       (928)       (350)
                                   ------      ------      ------
       Net cash used in         
         financing activities       (288)       (928)       (350)
                                   ------      ------      ------

 NET INCREASE (DECREASE) IN     
   CASH AND CASH EQUIVALENTS         (34)       (369)        265

 CASH AND CASH EQUIVALENTS:

  BEGINNING OF YEAR                  187         556         291
                                   ------      ------      ------

  END OF YEAR                    $   153     $   187     $   556
                                   ======      ======      ======
</TABLE>

                  The accompanying notes are an integral part 
                          of the financial statements.

                        MAY DRILLING PARTNERSHIP 1983-3  
                                       AND
                         MAY LIMITED PARTNERSHIP 1983-3

                          NOTES TO FINANCIAL STATEMENTS


(1)  ACCOUNTING POLICIES AND OTHER MATTERS

GENERAL PARTNERSHIP 

May  Drilling Partnership  1983-3,  a Texas  general  partnership (the  "General
Partnership"), was organized by  May Petroleum Inc.  ("May") for the purpose  of
oil and  gas exploration through May  Limited Partnership   1983-3 (the "Limited
Partnership").  The  General Partnership  was formed on  November 7, 1983,  with
investors ("Participants") subscribing an aggregate of $11,629,000 in assessable
$1,000 units.    After the  expenditure  of  the initial  contributions  of  the
Participants,  additional  mandatory  assessments  from  each   Participant  are
provided  for under the terms of the  general partnership agreement in an amount
up  to 25%  of  the initial  contribution  of the  Participant.   No  additional
assessments were made.

The  general partnership agreement requires  that the manager,  Hallwood  Energy
Partners,    L.  P. ("HEP"),  offer  to  repurchase  partnership interests  from
Participants for  cash at amounts to  be determined by appraisal  of the Limited
Partnership's net  assets no later  than December 31,  1988, and during  the two
succeeding years,  if  such net  assets  are positive.    The manager  has  made
repurchase offers in all years since 1989 and intends to make a repurchase offer
in 1996.

As  the  General  Partnership  is  the  sole  limited  partner  of  the  Limited
Partnership,  its results  of operations,  cash flows  and changes  in partners'
capital are equal  to the limited partner's  share of the Limited  Partnership's
results of operations, cash flows and changes in partners' capital  as set forth
herein.  Therefore, separate statements of operations, cash flows and changes in
partners' capital are not presented for the General Partnership.

LIMITED PARTNERSHIP 

The Limited  Partnership, a Texas limited partnership,  was organized by May and
the General  Partnership, for  the purpose  of oil and  gas exploration  and the
production  of crude  oil, natural  gas  and petroleum  products.   The  Limited
Partnership's oil and gas reserves are  located in prospects in south Louisiana.
Among  other things,  the  terms  of  the  Limited  Partnership  agreement  (the
"Agreement")  give the  general  partner the  authority  to borrow  funds.   The
Agreement also  requires that the general partner's  total capital contributions
to the  Limited Partnership as of  each year end,  including unrecovered general
partner  acreage and  equipment  advances, must  be  compared to  total  Limited
Partnership expenditures from inception  to date, and if such  contributions are
less than 15% of such expenditures,  an additional contribution in the amount of
the deficiency  is required.  At December  31, 1995, no additional contributions
were necessary to comply with this requirement.

On June 30, 1987,  May sold to HEP all  of its economic interest in  the Limited
Partnership and account  receivable balances due  from the Limited  Partnership.
HEP became the general partner of the Limited Partnership in 1988.



SHARING OF COSTS AND REVENUES 

Capital  costs, as defined by  the Agreement, for  commercially productive wells
and the costs related to  the organization of the Limited Partnership  are borne
by the general partner.  Noncapital costs and direct expenses, as defined by the
Agreement, are charged 1% to the general partner and 99% to the limited partner.
Oil  and gas sales, operating  expenses and general  and administrative overhead
are shared so that  the general partner's  allocation will equal the  percentage
that the  amount of Limited Partnership  expenses, as defined,  allocated to the
general  partner bears to the  aggregate amount of  Limited Partnership expenses
allocated to  the general partner  and the  limited partner, plus  15 percentage
points, but in no event  will the general partner's allocation exceed 50%.   The
sharing ratio for each of the last three years was as follows: 

<TABLE>
<CAPTION>
                       1995      1994      1993 
                       ------    ------    ------
 <S>                   <C>       <C>       <C> 
 Limited               57.9%     58.1%     58.6%
 Partnership
 General Partner       42.1%     41.9%     41.4%
</TABLE>


SIGNIFICANT CUSTOMER 
     
For the years ended December 31, 1995, 1994 and 1993, purchases by the following
company  exceeded  10%  of  the  total  oil and  gas  revenues  of  the  Limited
Partnership: 

<TABLE>
<CAPTION>
                       1995      1994      1993 
                       ------    ------    ------
 <S>                   <C>        <C>       <C>
 Conoco Inc.            94%       62%       74%
</TABLE>


Although the  Limited Partnership sells  the majority of  its production  to one
purchaser, there  are numerous other purchasers in the area,  so the loss of its
significant  customer  would  not  adversely  affect  the Limited  Partnership's
operations.

INCOME TAXES 

No provision for federal income taxes is included in the financial statements of
the  Limited Partnership  or the General  Partnership because,  as partnerships,
they  are not  subject  to federal  income  tax and  the  tax effects  of  their
activities  accrue  to  the  partners.    The  partnerships'  tax  returns,  the
qualification  of  the  General and  Limited  Partnerships  as partnerships  for
federal income  tax purposes,  and the  amount  of taxable  income or  loss  are
subject  to examination  by  federal  and state  taxing  authorities.   If  such
examinations result in changes  to the partnerships' taxable income or loss, the
tax liability of the partners could change accordingly.

OIL AND GAS PROPERTIES 

The Limited Partnership follows the  full cost method of accounting for  oil and
gas  properties  and, accordingly,  capitalizes  all costs  associated  with the
exploration and development of oil and gas reserves.

The capitalized costs  of evaluated properties,  including the estimated  future
costs to develop proved reserves, are amortized on the unit of production basis.
Full cost  amortization per dollar  of gross  oil and gas  revenues was  $.21 in
1995, $.18 in 1994 and $.16 in 1993.

Capitalized costs are limited  to an amount not  to exceed the present value  of
estimated future net cash  flows.  No valuation adjustment was required in 1995,
1994  or 1993.  Significant price declines in the future could cause the Limited
Partnership to experience valuation  adjustments and could reduce the  amount of
future cash flow available for distributions and operations.


Generally  no gains or losses are  recognized on the sale  or disposition of oil
and  gas properties.   Maintenance and repairs  are charged  against income when
incurred.  

During  1995,  the  Financial  Accounting Standards  Board  issued  Statement of
Financial Accounting Standards No.  121 "Accounting for the Impairment  of Long-
Lived  Assets and for Long-Lived  Assets to be Disposed Of"  ("SFAS 121").  SFAS
121 provides  the standards for  accounting for the impairment  of various long-
lived assets.   The Limited Partnership is  required to adopt SFAS  121 no later
than 1996.   The Limited Partnership uses the full cost method of accounting for
its only long-lived  assets, which  requires an impairment  to be recorded  when
total  capitalized costs  exceed  the  present  value,  discounted  at  10%,  of
estimated future net revenues from proved  oil and gas reserves.  Therefore, the
adoption of SFAS 121 is not expected to have  a material effect on the financial
position or results of operations of the Limited Partnership.

GAS BALANCING 

The Limited Partnership uses the sales method for accounting  for gas balancing.
Under this  method, the  Limited Partnership recognizes  revenue on  all of  its
sales of production, and any over production or under production is recovered at
a future date.

As  of December 31, 1995, the net  imbalance to the Limited Partnership interest
is not considered  material.  Current imbalances can be  made up with production
from  existing wells or from  wells which will be  drilled as offsets to current
producing wells.

USE OF ESTIMATES

The  preparation of  the financial  statements for  the Limited  Partnership and
General Partnership in conformity  with generally accepted accounting principles
requires management to make  estimates and assumptions that affect  the reported
amounts  of assets  and  liabilities and  disclosure  of contingent  assets  and
liabilities at  the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.  Actual results  could differ
from these estimates.

RELATED PARTY TRANSACTIONS 

Hallwood Petroleum, Inc. ("HPI"), a subsidiary of the general  partner, pays all
costs and expenses  of operations and receives all  revenues associated with the
Limited Partnership's properties.   At  month end, HPI  distributes revenues  in
excess of costs to the Limited Partnership.

The amounts  due from HPI were $39,000  and $11,000 as of  December 31, 1995 and
1994,  respectively.  These balances represent net revenues less operating costs
and expenses.  

CASH FLOWS 

All  highly  liquid investments  purchased with  an  original maturity  of three
months or less are considered to be cash equivalents. 

RECLASSIFICATIONS

Certain reclassifications have been made  to prior years' amounts to conform  to
the classifications used in the current year.

(2)  GENERAL AND ADMINISTRATIVE OVERHEAD

HPI conducts  the day to  day operations  of the Limited  Partnership and  other
affiliated  partnerships  of  HEP.   The  costs  of operating  the  entities are
allocated to  each partnership based  upon the  time spent on  that partnership.
General  and administrative overhead allocated by HPI to the Limited Partnership
totaled $80,000 in 1995, $103,000 in 1994 and $143,000 in 1993. 


(3)  LEGAL PROCEEDINGS

In June 1993, 14 lawsuits were filed against the Limited Partnership in the 15th
Judicial  District Court,  Lafayette  Parish, Louisiana,  Docket Nos.  93-2332-F
through 93-2345-F,  styled Lamson  Petroleum Corporation v.  Hallwood Petroleum,
Inc. et  al.  The plaintiffs in  the lawsuits claim that  they have valid leases
covering streets and roads  in the units of the  A. L. Boudreaux #1 well,  G. S.
Boudreaux #1  well, Mary Guilbeau  #1 well and  Duhon #1 well,  which represents
approximately   3%  to  4%  of  the  Limited  Partnership's  interest  in  these
properties,  and are  entitled to  a portion  of the  production from  the wells
dating from February 1990.  The  Limited Partnership has not recognized  revenue
attributable  to the  contested  leases since  January  1993.   These  revenues,
totaling  $61,000  at December  31,  1995, have  been placed  in  escrow pending
resolution of the lawsuits.  At this time, the Limited Partnership believes that
the difference  between the escrowed amount and the amount of any liability that
may result upon resolution of this matter will not be material.

In February 1994, the Limited  Partnership and the other parties to  the lawsuit
styled SAS  Exploration, Inc. v. Hall  Financial Group, Inc. et  al. settled the
lawsuit.  The  plaintiffs alleged that certain leases in the  A. L. Boudreaux #1
and  A. M. Duhon  #1 wells expired  and terminated at  the end of  their primary
terms as a result of production being from the Bol Mex 4 Sand rather than the A.
B. Sand.   In the settlement, the Limited Partnership  and the plaintiffs cross-
conveyed interests in certain leases to one  another and the Limited Partnership
paid  the plaintiffs  $306,000.  The  cash paid  by the  Limited Partnership was
reflected  as litigation settlement expense  in the December  31, 1993 financial
statements.   The  interest conveyance  resulted in  a  decrease in  the Limited
Partnership's reserves  as of  December 31,  1993 totaling  197,000 mcf of  gas,
4,100 barrels of oil and $371,000 in future net revenues, discounted at 10%.


                  SUPPLEMENTAL OIL AND GAS RESERVE INFORMATION
                                   (Unaudited)


The  following tables contain certain  costs and reserve  information related to
the Limited Partnership's  oil and gas activities.   The Limited Partnership has
no long-term  supply agreements and all  reserves are located  within the United
States.

COSTS INCURRED -

<TABLE>
<CAPTION>
                                   For the Years Ended December 31,
                                  1995           1994            1993
                                 ------        ------          -----
                                            (In thousands)
 <S>                              <C>             <C>           <C> 
 Development costs                $ 39            $  9          $ 36
 Acquisition costs                   -               -            22
                                  ----             ---           ---
                                  $ 39            $  9          $ 58
                                  ====             ===           ===
/TABLE
<PAGE>
OIL AND GAS RESERVES -

<TABLE>
<CAPTION>
                                1995               1994              1993  
                              --------          --------          --------
                           Bbls      Mcf      Bbls      Mcf     Bbls      Mcf
                            ----    ---       ----      ---     ----      ---
 <S>                      <C>      <C>        <C>    <C>        <C>    <C>  
 Total Proved Reserves:
  Beginning of period      39      1,870       46    2,279       58    2,852
  Revisions to previous
  estimates                 5        257       (2)    (127)       -       75
  Litigation settlement
  (a)                       -          -        -        -       (4)    (197)

  Sale of reserves in
  place                     -          -        -      (21)       -        -
  Production               (5)      (283)      (5)    (261)      (8)    (451)

    End of Period          39      1,844       39    1,870       46    2,279


 Proved Developed
 Reserves:
    Beginning of period    39      1,870       46    2,267       58    2,852

    End of period          39      1,844       39    1,870       46    2,267

</TABLE>


Certain reserve value  information is provided directly to  partners pursuant to
the Agreement.  Accordingly, such information is not presented herein.

(a)  See Note 3 to financial statements.

ITEM 9 - DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

  None.


                                    PART III
                                    --------


ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Drilling  Partnership and Limited  Partnership are managed by  affiliates of
HEP and do not have directors or executive officers.


ITEM 11 - EXECUTIVE COMPENSATION

The  partnerships pay  no salaries  or  other direct  remuneration to  officers,
directors  or key  employees  of  the  general  partner or  HPI.    The  Limited
Partnership reimburses the general partner  for general and administrative costs
incurred on behalf of the partnerships.  See Note 2 to the Financial Statements.


ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

To  the  knowledge  of  the  general  partner,  no  person  owns  of  record  or
beneficially more than 5% of the Drilling Partnership's outstanding units, other
than  HEP,  the address  of  which is  4582  S. Ulster  Street  Parkway, Denver,
Colorado  80237,  and  which  beneficially  owns  approximately  37.2%  of   the
outstanding units.  The general partner of HEP is Hallwood Energy Corporation. 


ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

For  information with respect to  the Limited Partnership  and its relationships
and transactions with the general partner, see Part I, Item 1  and Part II, Item
7.


                                     PART IV
                                     -------


ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

  a. Financial Statements and Schedules:
     See Index at Item 8.

  b. Reports on Form 8-K - None.

  c. Exhibits:

   3.1  The General Partnership Agreement  and the Limited Partnership Agreement
        filed  as  an  Exhibit   to  Registration  Statement  No.  0-11313,  are
        incorporated herein by reference.


SIGNATURES
----------

Pursuant to the requirements of  Section 13 or 15(d) of the  Securities Exchange
Act  of 1934, as  amended, the Partnerships  have duly caused  this report to be
signed on their behalf by the undersigned, thereunto duly authorized.


                               MAY DRILLING PARTNERSHIP 1983-3
                               MAY LIMITED PARTNERSHIP 1983-3
                               BY: EDP OPERATING, LTD., GENERAL
                                   PARTNER

                               BY: HALLWOOD G.P., INC.
                                   GENERAL PARTNER




                               By: /s/William L. Guzzetti
                                     --------------------------  
                                     William L. Guzzetti
                                   President, Chief Executive
                                   Officer and Director


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below  by the following persons on behalf  of the registrant and
in the capacities and on the dates indicated.

           Signature                  Title               Date
           ---------                  -----               ----




 /s/Robert S. Pfeiffer         Vice President      February 29, 1996
 ---------------------------   (Principal          -----------------
    Robert S. Pfeiffer         Accounting
                               Officer)