<PAGE>


                  SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C. 20549


                               FORM 10-Q


           Quarterly Report Pursuant to Section 13 or 15(d)
                of the Securities Exchange Act of 1934



     For the quarter ended              Commission File Number
        June 30, 1997                         0-10478


                    DYCO OIL AND GAS PROGRAM 1981-2
                        (A LIMITED PARTNERSHIP)
        (Exact Name of Registrant as specified in its charter)



            Minnesota                       41-1411952  
   (State or other jurisdiction    (I.R.S. Employer Identification
        of incorporation or                   Number)
          organization)




     Samson Plaza, Two West Second Street, Tulsa, Oklahoma  74103
     ------------------------------------------------------------
     (Address of principal executive offices)          (Zip Code)



                         (918) 583-1791
          ----------------------------------------------------
          (Registrant's telephone number, including area code)




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      
                              ----     ----
<PAGE>
<PAGE>
                    PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                            BALANCE SHEETS
                              (Unaudited)

                                ASSETS
                                         June 30,    December 31,
                                           1997         1996
                                        ----------   ------------

CURRENT ASSETS:
  Cash and cash equivalents               $176,372      $272,066
  Accrued oil and gas sales                 72,458       116,046
                                          --------      --------
     Total current assets                 $248,830      $388,112

NET OIL AND GAS PROPERTIES, utilizing
  the full cost method                     127,724       155,188

DEFERRED CHARGE                             43,273        43,273
                                          --------      --------
                                          $419,827      $586,573
                                          ========      ========

                   LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
  Accounts payable                        $  8,967      $  9,896
                                          --------      --------
     Total current liabilities            $  8,967      $  9,896

ACCRUED LIABILITY                          123,973       123,973

PARTNERS' CAPITAL:
  General Partner, issued and
   outstanding, 74 units                     2,869         4,527
  Limited Partners, issued and
   outstanding, 6,000 units                284,018       448,177
                                          --------      --------
     Total Partners' capital              $286,887      $452,704
                                          --------      --------
                                          $419,827      $586,573
                                          ========      ========

               The accompanying condensed notes are an 
             integral part of these financial statements.

                                  -2-
<PAGE>
<PAGE>
          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                       STATEMENTS OF OPERATIONS
           FOR THE THREE MONTHS ENDED JUNE 30, 1997 AND 1996
                              (Unaudited)


                                           1997         1996
                                         --------     --------

REVENUES:
  Oil and gas sales                      $100,315      $54,153
  Interest                                  1,369        3,173
                                         --------      -------
                                         $101,684      $57,326

COST AND EXPENSES:
  Oil and gas production                 $ 31,456      $23,882
  Depreciation, depletion, and
   amortization of oil and gas
   properties                               5,721        6,425
  General and administrative (Note 2)      15,198       17,213
                                         --------      -------
                                         $ 52,375      $47,520
                                         --------      -------

NET INCOME                               $ 49,309      $ 9,806 
                                         ========      =======
GENERAL PARTNER (1%) - net        
  income                                 $    493      $    98 
                                         ========      =======
LIMITED PARTNERS (99%) - net
  income                                 $ 48,816      $ 9,708 
                                         ========      =======
NET INCOME PER UNIT                      $   8.12      $  1.61 
                                         ========      =======
UNITS OUTSTANDING                           6,074        6,074
                                         ========      =======

               The accompanying condensed notes are an 
             integral part of these financial statements.

                                  -3-
<PAGE>
<PAGE>
          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                       STATEMENTS OF OPERATIONS
            FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
                              (Unaudited)


                                           1997         1996
                                         --------     --------

REVENUES:
  Oil and gas sales                      $273,009     $163,583
  Interest                                  4,193        5,713
                                         --------     --------
                                         $277,202     $169,296

COST AND EXPENSES:
  Oil and gas production                 $ 70,293     $ 51,802
  Depreciation, depletion, and
   amortization of oil and gas
   properties                              28,549       17,631
  General and administrative (Note 2)      40,477       37,720
                                         --------     --------
                                         $139,319     $107,153
                                         --------     --------

NET INCOME                               $137,883     $ 62,143 
                                         ========     ========
GENERAL PARTNER (1%) - net        
  income                                 $  1,379     $    621 
                                         ========     ========
LIMITED PARTNERS (99%) - net
  income                                 $136,504     $ 61,522 
                                         ========     ========
NET INCOME PER UNIT                      $  22.70     $  10.23 
                                         ========     ========
UNITS OUTSTANDING                           6,074        6,074
                                         ========     ========

               The accompanying condensed notes are an 
             integral part of these financial statements.

                                  -4-
<PAGE>
<PAGE>
          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                       STATEMENTS OF CASH FLOWS
            FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
                              (Unaudited)

                                           1997         1996
                                         ---------    ---------

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                             $137,883     $ 62,143 
  Adjustments to reconcile net income
   to net cash provided by operating
   activities:
   Depreciation, depletion, and 
     amortization of oil and gas
     properties                            28,549       17,631
   Decrease in accrued oil and
     gas sales                             43,588        5,717 
   Decrease in accounts payable         (     929)   (   2,488)
                                         --------     -------- 
   Net cash provided by operating        
     activities                          $209,091     $ 83,003
                                         --------     --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Retirements of oil and gas
   properties                            $      -     $    958 
  Additions to oil and gas properties   (   1,085)   (  14,470)
                                         --------     --------
   Net cash used by investing 
     activities                         ($  1,085)   ($ 13,512)
                                         --------     --------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Cash distributions                   ($303,700)    $    -
                                         --------     --------

   Net cash used by financing
     activities                         ($303,700)    $    -
                                         --------     --------

NET INCREASE (DECREASE) IN CASH AND
  CASH EQUIVALENTS                      ($ 95,694)    $ 69,491

CASH AND CASH EQUIVALENTS AT 
  BEGINNING OF PERIOD                     272,066      245,084
                                         --------     --------
CASH AND CASH EQUIVALENTS AT
  END OF PERIOD                          $176,372     $314,575
                                         ========     ========

               The accompanying condensed notes are an 
             integral part of these financial statements.

                                  -5-
<PAGE>
<PAGE>
          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                CONDENSED NOTES TO FINANCIAL STATEMENTS
                             JUNE 30, 1997
                              (Unaudited)


1.   ACCOUNTING POLICIES
     -------------------

     The balance sheet as  of June 30, 1997, statements  of operations
     for the  three and six months  ended June 30, 1997  and 1996, and
     statements of  cash flows for the six  months ended June 30, 1997
     and  1996  have  been  prepared  by  Dyco  Petroleum  Corporation
     ("Dyco"), the general  partner of  the Dyco Oil  and Gas  Program
     1981-2 Limited  Partnership (the  "Program"), without audit.   In
     the  opinion of  management all  adjustments (which  include only
     normal recurring  adjustments) necessary  to  present fairly  the
     financial position  at June 30,  1997, results of  operations for
     the three and six months ended June 30, 1997 and 1996 and changes
     in cash  flows for the  six months ended  June 30, 1997  and 1996
     have been made.

     Information  and   footnote  disclosures  normally   included  in
     financial  statements  prepared  in  accordance   with  generally
     accepted accounting principles  have been  condensed or  omitted.
     It  is  suggested  that these  financial  statements  be  read in
     conjunction  with  the  financial  statements  and notes  thereto
     included in the Program's Annual Report on Form 10-K for the year
     ended  December  31, 1996.   The  results  of operations  for the
     period  ended June 30, 1997 are not necessarily indicative of the
     results to be expected for the full year.  

     The limited partners' net income  or loss per unit is based  upon
     each $5,000 initial capital contribution.

     OIL AND GAS PROPERTIES
     ----------------------

     Oil  and gas  operations are  accounted for  using the  full cost
     method  of accounting.  All productive  and  non-productive costs
     associated  with the acquisition,  exploration and development of
     oil and gas reserves are capitalized.   The Program's calculation
     of depreciation, depletion,  and amortization includes  estimated
     future expenditures to be  incurred in developing proved reserves
     and   estimated  dismantlement  and  abandonment  costs,  net  of
     estimated salvage values.   In the event the unamortized  cost of
     oil  and gas  properties  being amortized  exceeds the  full cost
     ceiling (as  defined by the Securities  and Exchange Commission),
     the excess is charged to expense in  the period during which such
     excess  occurs.    Sales   and  abandonments  of  properties  are
     accounted for as adjustments of capitalized costs with no gain or
     loss  recognized, unless  such  adjustments  would  significantly
     alter the  relationship between capitalized costs  and proved oil
     and gas reserves.

     The provision  for depreciation,  depletion, and  amortization of
     oil  and gas properties is calculated by dividing the oil and gas
     sales dollars  during the  period by  the estimated future  gross
     income from the oil and gas properties and applying the resulting
     rate to the  net remaining costs of  oil and gas properties  that
     have been capitalized, plus estimated future development costs.

                                  -6-
<PAGE>
<PAGE>
2.   TRANSACTIONS WITH RELATED PARTIES
     ---------------------------------

     Under the terms  of the Program's partnership  agreement, Dyco is
     entitled to receive a reimbursement  for all direct expenses  and
     general and administrative,  geological and engineering  expenses
     it incurs  on behalf  of the  Program.  During  the three  months
     ended  June 30, 1997 and  1996 such expenses  totaled $15,198 and
     $17,213,  respectively, of  which $11,988  was paid  quarterly to
     Dyco  and its affiliates.   During the six  months ended June 30,
     1997  and  1996  such   expenses  totaled  $40,477  and  $37,720,
     respectively, of which $23,976  was paid each period to  Dyco and
     its affiliates.  

     Affiliates  of  the  Program  operate certain  of  the  Program's
     properties.   Their  policy  is  to  bill  the  Program  for  all
     customary charges and  cost reimbursements associated with  these
     activities.

                                  -7-
<PAGE>
<PAGE>
ITEM 2.   MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
          AND RESULTS OF OPERATIONS


USE OF FORWARD-LOOKING STATEMENTS AND ESTIMATES
-----------------------------------------------

     This   Quarterly   Report   contains    certain   forward-looking
     statements.  The words "anticipate," "believe," "expect," "plan,"
     "intend,"  "estimate," "project,"  "could,"  "may,"  and  similar
     expressions are intended  to identify forward-looking statements.
     Such statements reflect management's  current views with  respect
     to  future  events and  financial  performance.   This  Quarterly
     Report also includes  certain information, which is,  or is based
     upon, estimates and assumptions.   Such estimates and assumptions
     are management's efforts to  accurately reflect the condition and
     operation of the Program.

     Use of forward-looking statements  and estimates and  assumptions
     involve  risks  and  uncertainties  which include,  but  are  not
     limited to, the volatility of oil and gas prices, the uncertainty
     of reserve  information, the  operating risk associated  with oil
     and gas properties (including the risk of personal injury, death,
     property  damage,  damage to  the  well  or producing  reservoir,
     environmental  contamination, and  other  operating  risks),  the
     prospect of  changing tax  and regulatory laws,  the availability
     and capacity  of  processing and  transportation facilities,  the
     general economic climate, the supply and price of foreign imports
     of  oil and gas,  the level of  consumer product demand,  and the
     price  and availability of alternative fuels.  Should one or more
     of  these risks  or uncertainties  occur or  should  estimates or
     underlying  assumptions  prove  incorrect, actual  conditions  or
     results  may vary  materially  and adversely  from those  stated,
     anticipated, believed, estimated, or otherwise indicated.


LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

     Net  proceeds   from  the  Program's  operations  less  necessary
     operating  capital are  distributed to  investors on  a quarterly
     basis.   The net proceeds  from production are  not reinvested in
     productive assets, except to the extent that producing wells  are
     improved or where methods  are employed to permit more  efficient
     recovery  of  the Program's  reserves  which  would result  in  a
     positive economic impact.

     The Program's available capital from subscriptions has been spent
     on oil and  gas drilling  activities.   There should  not be  any
     further material capital resource commitments in the future.  The
     Program has  no  bank debt  commitments.   Cash  for  operational
     purposes will be provided by current oil and gas production.

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

     GENERAL DISCUSSION

     The following  general discussion  should be read  in conjunction
     with the analysis of  results of operations provided below.   The
     most important  variable affecting the Program's  revenues is the

                                  -8-
<PAGE>
<PAGE>
     prices received  for the sale of oil  and gas.  Predicting future
     prices is very difficult.  Substantially all of the Program's gas
     reserves are being sold in the "spot market".  Prices on the spot
     market  are  subject  to   wide  seasonal  and  regional  pricing
     fluctuations due  to the  highly competitive  nature of  the spot
     market.  In addition, such spot market sales are generally short-
     term  in   nature  and  are  dependent  upon   the  obtaining  of
     transportation  services provided  by  pipelines.   Management is
     unable  to predict  whether future  oil and  gas prices  will (i)
     stabilize, (ii) increase, or (iii) decrease.

     THREE MONTHS ENDED JUNE 30, 1997 AS COMPARED TO THE  THREE MONTHS
     ENDED JUNE 30, 1996.
                                       Three months ended June 30,
                                       ---------------------------
                                          1997             1996
                                        --------          -------
      Oil and gas sales                 $100,315          $54,153
      Oil and gas production expenses   $ 31,456          $23,882
      Barrels produced                       302              322
      Mcf produced                        53,513           23,117
      Average price/Bbl                 $  17.86          $ 22.63
      Average price/Mcf                 $   1.77          $  2.03
 
     As shown in  the table above, total  oil and gas  sales increased
     $46,162  (85.2%)  for the  three months  ended  June 30,  1997 as
     compared  to  the three  months  ended June  30, 1996.    Of this
     increase,  approximately $62,000  was related  to an  increase in
     volumes   of  gas  sold,  partially  offset   by  a  decrease  of
     approximately  $14,000 related to a decrease in the average price
     of gas sold.   Volumes  of oil sold  decreased 20 barrels,  while
     volumes of gas  sold increased  30,396 Mcf for  the three  months
     ended  June 30, 1997  as compared to the  three months ended June
     30, 1996.  The increase in volumes of gas sold resulted primarily
     from  a negative gas balancing adjustment made by the operator on
     one well during  the three months ended  June 30, 1996.   Average
     oil and gas  prices decreased to $17.86 per barrel  and $1.77 per
     Mcf,  respectively, for the three months ended June 30, 1997 from
     $22.63  per barrel and $2.03 per Mcf, respectively, for the three
     months ended June 30, 1996.  

     Oil  and  gas  production  expenses  (including  lease  operating
     expenses and  production taxes) increased $7,574  (31.7%) for the
     three months ended June 30, 1997 as compared  to the three months
     ended June 30, 1996.   This increase resulted primarily  from (i)
     an  increase in volumes of gas sold during the three months ended
     June 30, 1997 as compared to the three months ended June 30, 1996
     and  (ii) an  increase in  production  taxes associated  with the
     increase  in oil and gas  sales discussed above, partially offset
     by  an  increase  in  general  repair  and  maintenance  expenses
     incurred on one well during the three months ended June 30,  1997
     as compared  to the  three  months ended  June 30,  1996.   As  a
     percentage of  oil and  gas sales,  these  expenses decreased  to
     31.4% for the three months ended June 30, 1997 from 44.1% for the
     three months ended June  30, 1996.  This percentage  decrease was
     primarily due  to higher  overall general repair  and maintenance
     expenses incurred during the three months ended June 30, 1996.

     Depreciation,  depletion,  and   amortization  of  oil   and  gas
     properties decreased $704 (11.0%) for the three months ended June
     30, 1997  as compared to  the three months  ended June  30, 1996.

                                  -9-
<PAGE>
<PAGE>
     This  decrease  resulted primarily  from an  increase in  the gas
     price  used  in  the valuation  of  reserves  at  June 30,  1997,
     partially  offset by the increase  in volumes of  gas sold during
     the three  months ended June  30, 1997  as compared to  the three
     months  ended June  30, 1996.   As  a percentage  of oil  and gas
     sales,  this expense decreased to 5.7% for the three months ended
     June 30,  1997 from  11.9% for the  three months  ended June  30,
     1996.  This percentage  decrease was primarily due to  the dollar
     decrease  in depreciation, depletion,  and amortization discussed
     above, partially offset by decreases in the average prices of oil
     and gas  sold  during the  three months  ended June  30, 1997  as
     compared to the three months ended June 30, 1996. 

     General and administrative expenses  decreased $2,015 (11.7%) for
     the three  months ended June  30, 1997  as compared to  the three
     months  ended June  30, 1996.   This decrease  resulted primarily
     from a  decrease in  professional fees  during  the three  months
     ended June 30, 1997  as compared to  the three months ended  June
     30,  1996.  As a percentage of  oil and gas sales, these expenses
     decreased to 15.2% for  the three months ended June 30, 1997 from
     31.8% for the three months ended  June 30, 1996.  This percentage
     decrease was primarily due to  the increase in oil and gas  sales
     discussed above.

     SIX  MONTHS ENDED  JUNE 30,  1997 AS  COMPARED TO THE  SIX MONTHS
     ENDED JUNE 30, 1996.
                                        Six months ended June 30,
                                        -------------------------
                                          1997             1996
                                        --------         --------
      Oil and gas sales                 $273,009         $163,583
      Oil and gas production expenses   $ 70,293         $ 51,802
      Barrels produced                       656              622
      Mcf produced                       117,569           84,627
      Average price/Bbl                 $  18.90         $  19.82
      Average price/Mcf                 $   2.22         $   1.79

     As shown in  the table above, total  oil and gas sales  increased
     $109,426  (66.9%) for  the  six months  ended  June 30,  1997  as
     compared  to  the six  months  ended  June  30, 1996.    Of  this
     increase, approximately  $51,000 and $59,000,  respectively, were
     related  to increases  in the  average price  and volumes  of gas
     sold.   Volumes  of oil  and gas  sold increased  34 barrels  and
     32,942  Mcf, respectively, for the six months ended June 30, 1997
     as compared  to the six months ended June 30, 1996.  The increase
     in volumes of gas sold resulted primarily from (i) a negative gas
     balancing  adjustment made by the operator on one well during the
     three  months ended  June 30,  1996 and  (ii) the  shutting-in of
     another well during the three months ended June 30, 1996 in order
     to improve production capabilities.  Average oil prices decreased
     to $18.90  per barrel for the six months ended June 30, 1997 from
     $19.82  per  barrel  for the  six  months  ended  June 30,  1996.
     Average gas prices increased  to $2.22 per Mcf for the six months
     ended June 30, 1997 from  $1.79 per Mcf for the six  months ended
     June 30, 1996.  

     Oil  and  gas  production  expenses  (including  lease  operating
     expenses and production taxes)  increased $18,491 (35.7%) for the
     six months  ended June  30, 1997  as compared  to the  six months
     ended June 30, 1996.   This increase resulted primarily  from (i)
     an increase  in volumes of  gas sold during the  six months ended

                                 -10-
<PAGE>
<PAGE>
     June  30, 1997 as compared to the  six months ended June 30, 1996
     and  (ii) an  increase  in production  taxes associated  with the
     increase in oil and gas sales  discussed above.  As a  percentage
     of oil and  gas sales, these expenses decreased to  25.7% for the
     six months ended  June 30,  1997 from  31.7% for  the six  months
     ended  June 30, 1996.  This percentage decrease was primarily due
     to  the increase in the average price  of gas sold during the six
     months ended  June 30, 1997 as  compared to the  six months ended
     June 30, 1996. 

     Depreciation,  depletion,  and   amortization  of  oil  and   gas
     properties  increased $10,918  (61.9%) for  the six  months ended
     June 30, 1997 as compared to the six months ended  June 30, 1996.
     This increase resulted  primarily from an increase  in volumes of
     gas sold during the six months ended June 30, 1997 as compared to
     the six months ended June 30, 1996.   As a percentage of oil  and
     gas sales,  these expenses remained relatively  constant at 10.5%
     for the  six months ended  June 30,  1997 and 10.8%  for the  six
     months ended June 30, 1996. 

     General and  administrative expenses increased $2,757  (7.3%) for
     the six months ended June 30, 1997 as compared to  the six months
     ended  June 30, 1996.   This increase resulted  primarily from an
     increase in  miscellaneous expenses  during the six  months ended
     June 30, 1997 as compared to the six months ended  June 30, 1996.
     As a percentage of oil and gas sales, these expenses decreased to
     14.8% for the six months  ended June 30, 1997 from 23.1%  for the
     six months ended  June 30,  1996.  This  percentage decrease  was
     primarily  due to  the increase  in oil  and gas  sales discussed
     above.  

                                 -11-
<PAGE>
<PAGE>
                      PART II:  OTHER INFORMATION


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          27.1      Financial   Data   Schedule   containing   summary
                    financial information extracted from the Program's
                    financial statements  as of June 30,  1997 and for
                    the  six  months   ended  June  30,  1997,   filed
                    herewith.

                    All other exhibits are omitted as inapplicable.

     (b)  Reports on Form 8-K

          None.

                                 -12-
<PAGE>
<PAGE>
                              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.


                         DYCO OIL AND GAS PROGRAM 1981-2 LIMITED
                         PARTNERSHIP

                              (Registrant)


                              By:  DYCO PETROLEUM CORPORATION

                                   General Partner




Date:  August 6, 1997        By:        /s/Dennis R. Neill
                                 -----------------------------
                                        (Signature)
                                        Dennis R. Neill
                                        President



Date:  August 6, 1997        By:        /s/Patrick M. Hall
                                 -----------------------------
                                        (Signature)
                                        Patrick M. Hall
                                        Chief Financial Officer


                                 -13-
<PAGE>
<PAGE>
                           INDEX TO EXHIBITS


NUMBER    DESCRIPTION
------    -----------

27.1      Financial   Data   Schedule  containing   summary  financial
          information  extracted from  the  Dyco Oil  and Gas  Program
          1981-2 Limited Partnership's financial statements as of June
          30, 1997 and  for the six months ended June  30, 1997, filed
          herewith.

          All other exhibits are omitted as inapplicable.
<PAGE>