**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington, D.C. 20549**

 

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## **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 March 31,  2008**                                                                                  |
|   |                                                                                                                                     |
| **OR** |
|   |                                                                                                                                     |
| o      | **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE  SECURITIES EXCHANGE ACT OF 1934**                                 |
|   |                                                                                                                                     |
|   | **For the Transition Period from                    to** |

 

**Commission File Number:333-122935-01**

 

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**REEF GLOBAL ENERGY VI, L.P.**

(Exact name of registrant asspecified in its charter)

 

| **Nevada**

(State or other jurisdiction of

incorporation or organization)                                            | ** ** | **20-3170768**

(I.R.S. employer

identification no.) |
|------------------------------------------------------------------------------------------------------------------------|------------|-------------------------------------------------------|
|                                                                                                                   |       |                                                  |
| **1901 N. Central Expressway, Suite 300**

**Richardson,  Texas 75080**

(Address of principal executive offices) | ** ** | **75080-3609**

(Zip code)                            |

** **

Registrant’s telephone number, including area code:                            **                (972)-437-6792**

 

Indicate by checkmark whether the registrant (1) has filed all reports required to be filedby Section 13 or 15(d) of the Securities Exchange Act of 1934 duringthe preceding 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days. Yes x    No o

 

Indicate by check markwhether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, or a smaller reporting company. See the definitions of “largeaccelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2of the Exchange Act.

 
| Large accelerated filer  o | Accelerated  filer o | Non-accelerated  filer o                       | Smaller  reporting company x |
|----------------------------|----------------------|------------------------------------------------|------------------------------|
|                       |                 | (Do not check if  a smaller reporting company) |                         |

 

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2 of theExchange Act). Yes o    No x

 

**As of March 31, 2008, the registrant had 75.363units of general partner interest held by the managing general partner,1,190.561 units of additional general partner interest and 241.336 units oflimited partner interest outstanding.**

** **

** **

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** **

**Reef Global Energy VI,L.P.**

**Form 10-QIndex**

 
| **PART I —  FINANCIAL INFORMATION** |
|-----------------------------------------------|
|                                          |   |
| **ITEM  1.**                                  | **Financial Statements (Unaudited)** |
|                                          | *Condensed  Balance Sheets* |
|                                          | *Condensed  Statements of Operations* |
|                                          | *Condensed  Statements of Cash Flows* |
|                                          | *Notes to  Condensed Financial Statements* |
|                                          |   |
| **ITEM 2.**                                   | **Management’s Discussion and  Analysis of Financial Condition and Results of Operations** |
|                                          |   |
| **ITEM 3.**                                   | **Quantitative and Qualitative  Disclosures About Market Risk** |
|                                          |   |
| **ITEM  4T.**                                 | **Controls and Procedures** |
|                                          |   |
| **PART II —  OTHER INFORMATION**    |
|                                          |   |
| **ITEM 1.**                                   | **Legal Proceedings** |
|                                          |   |
| **ITEM 2.**                                   | **Unregistered Sales of Equity  Securities and Use of Proceeds** |
|                                          |   |
| **ITEM 3.**                                   | **Default Upon Senior  Securities** |
|                                          |   |
| **ITEM 4.**                                   | **Submission of Matters to a  Vote of Security Holders** |
|                                          |   |
| **ITEM 5.**                                   | **Other Information** |
|                                          |   |
| **ITEM 6.**                                   | **Exhibits** |
|                                          |   |
| **Signatures**                                |   |

 

i

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# **PART IFINANCIAL INFORMATION**

# ** **

## **Item 1. FinancialStatements**

**Reef Global Energy VI, L.P.**

**Condensed Balance Sheets**

 
| ** **                                                                      | ** ** | **March 31,** | ** **     | **December 31,** | ** ** |
|---------------------------------------------------------------------------------|------------|--------------------|----------------|-----------------------|------------|
| ** **                                                                      | ** ** | **2008**           | ** **     | **2007**              | ** ** |
| ** **                                                                      | ** ** | **(Unaudited)**    | ** **     | ** **            | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Assets**                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Current  assets:**                                                            | ** ** | ** **         | ** **     | ** **            | ** ** |
| Cash and cash  equivalents                                                      | ** ** | $                  | 875,264        |                  | $          | 2,366,065 | ** ** |
| Accounts  receivable from affiliates                                            |       | 1,117,683          |           | 15,098                |       |
| **Total  current assets**                                                       | ** ** | **1,992,947**      | ** **     | **2,381,163**         | ** ** |
|                                                                            |       |               |           |                  |       |
| **Oil and  gas properties, full cost method of accounting:**                    | ** ** | ** **         | ** **     | ** **            | ** ** |
| Proved  properties, net of accumulated depletion of $21,127,626 and $20,632,938 |       | 11,379,504         |           | 11,359,244            |       |
| Unproved  properties                                                            |       | 172,930            |           | 172,930               |       |
| **Net oil  and gas properties**                                                 | ** ** | **11,552,434**     | ** **     | **11,532,174**        | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Total  assets**                                                               | ** ** | **$**              | **13,545,381** | ** **            | **$**      | **13,913,337** | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Liabilities  and partnership equity**                                         | ** ** | ** **         | ** **     | ** **            | ** ** |
|                                                                            |       |               |           |                  |       |
| **Current  liabilities:**                                                       | ** ** | ** **         | ** **     | ** **            | ** ** |
| Accounts payable                                                                | ** ** | $                  | 273            |                  | $          | 1,981 | ** ** |
| Accounts payable  to affiliates                                                 |       | 722,140            |           | 661,692               |       |
| **Total  current liabilities**                                                  | ** ** | **722,413**        | ** **     | **663,673**           | ** ** |
|                                                                            |       |               |           |                  |       |
| **Long-term  liabilities:**                                                     | ** ** | ** **         | ** **     | ** **            | ** ** |
| Accounts payable  to affiliates                                                 |       | 44,789             |           | 144,789               |       |
| Asset retirement  obligation                                                    |       | 326,861            |           | 305,215               |       |
| **Total  long-term liabilities**                                                | ** ** | **371,650**        | ** **     | **450,004**           | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Partnership  equity:**                                                        | ** ** | ** **         | ** **     | ** **            | ** ** |
| General partners                                                                |       | 9,692,745          |           | 9,975,966             |       |
| Limited partners                                                                |       | 1,964,865          |           | 2,022,276             |       |
| Managing general  partner                                                       |       | 793,708            |           | 801,418               |       |
| **Partnership  equity**                                                         | ** ** | **12,451,318**     | ** **     | **12,799,660**        | ** ** |
| ** **                                                                      | ** ** | ** **         | ** **     | ** **            | ** ** |
| **Total  liabilities and partnership equity**                                   | ** ** | **$**              | **13,545,381** | ** **            | **$**      | **13,913,337** | ** ** |

 

*Seeaccompanying notes to condensed financial statements.*

 

1

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**Reef Global Energy VI, L.P.**

**Condensed Statements of Operations**

** **
| ** **                                          | ** ** | **For the three months ended  March 31, (unaudited)** | ** **    |
|-----------------------------------------------------|------------|------------------------------------------------------------|---------------|
| ** **                                          | ** ** | **2008**                                                   | ** **    | **2007** | ** ** |
| ** **                                          | ** ** | ** **                                                 | ** **    | ** ** | ** ** |
| **Revenues**                                        | ** ** | **$**                                                      | **1,920,280** | ** ** | **$** | **509,731** | ** ** |
| ** **                                          |       |                                                       |          |   |   |
| **Costs and expenses:**                             | ** ** | ** **                                                 | ** **    | ** ** | ** ** |
| Lease operating  expenses                           |       | 206,421                                                    |          | 52,172 |   |
| Production taxes                                    |       | 135,203                                                    |          | 39,536 |   |
| Depreciation,  depletion and amortization           |       | 494,688                                                    |          | 711,644 |   |
| Property  impairment                                |       | —                                                     |          | 6,333,132 |   |
| Accretion of  asset retirement obligation           |       | 4,060                                                      |          | 7,397 |   |
| General and administrative                          |       | 115,824                                                    |          | 35,045 |   |
| **Total costs and expenses**                        | ** ** | **956,196**                                                | ** **    | **7,178,926** | ** ** |
|                                                |       |                                                       |          |   |   |
| **Income (loss) from operations**                   | ** ** | **964,084**                                                | ** **    | **(6,669,195** | **)** |
|                                                |       |                                                       |          |   |   |
| **Other income:**                                   | ** ** | ** **                                                 | ** **    | ** ** | ** ** |
| Interest income                                     |       | 10,574                                                     |          | 157,205 |   |
| **Total other income**                              | ** ** | **10,574**                                                 | ** **    | **157,205** | ** ** |
|                                                |       |                                                       |          |   |   |
| **Net income (loss)**                               | ** ** | **$**                                                      | **974,658**   | ** ** | **$** | **(6,511,990** | **)** |
|                                                |       |                                                       |          |   |   |
| Net income (loss) per general partner unit          | ** ** | **$**                                                      | **543.31**    | ** ** | **$** | **(4,312.56** | **)** |
| Net income (loss) per limited partner unit          | ** ** | **$**                                                      | **543.31**    | ** ** | **$** | **(4,312.56** | **)** |
| Net income (loss) per managing general partner unit | ** ** | **$**                                                      | **2,609.96**  | ** ** | **$** | **(4,469.70** | **)** |

 

*See accompanying notes tocondensed financial statements.*

 

2

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**Reef Global Energy VI, L.P.**

**Condensed Statements of Cash Flows**

 
| ** **                                                                       | ** ** | **For the three months ended  March 31, (unaudited)** | ** **  |
|----------------------------------------------------------------------------------|------------|------------------------------------------------------------|-------------|
| ** **                                                                       | ** ** | **2008**                                                   | ** **  | **2007** | ** ** |
| ** **                                                                       | ** ** | ** **                                                 | ** **  | ** ** | ** ** |
| **Operating  Activities**                                                        |       |                                                       |        |   |   |
| Net income  (loss)                                                               | ** ** | $                                                          | 974,658     |   | $ | (6,511,990 | **)** |
| Adjustments for  non-cash transactions:                                          |       |                                                       |        |   |   |
| Depreciation,  depletion and amortization                                        |       | 494,688                                                    |        | 711,644 |   |
| Property  impairment                                                             |       | —                                                     |        | 6,333,132 |   |
| Accretion of  asset retirement obligation                                        |       | 4,060                                                      |        | 7,397 |   |
| Adjustments to  reconcile net loss to net cash provided by operating activities: | ** ** | ** **                                                 | ** **  | ** ** | ** ** |
| Changes in  operating assets and liabilities:                                    |       |                                                       |        |   |   |
| Accounts  receivable from affiliates                                             |       | (1,117,683                                                 | )           | 46,842 |   |
| Accounts payable                                                                 |       | (1,708                                                     | )           | (1,739 | ) |
| Accounts payable  to affiliates                                                  |       | 105,677                                                    |        | 26,992 |   |
| **Net  cash provided by operating activities**                                   | ** ** | **459,692**                                                | ** **  | **612,278** | ** ** |
|                                                                             |       |                                                       |        |   |   |
| **Investing  Activities**                                                        | ** ** | ** **                                                 | ** **  | ** ** | ** ** |
| Property  acquisition and development                                            |       | (542,591                                                   | )           | (4,777,141 | ) |
| **Net  cash used in investing activities**                                       | ** ** | **(542,591**                                               | **)**       | **(4,777,141** | **)** |
|                                                                             |       |                                                       |        |   |   |
| **Financing  Activities**                                                        | ** ** | ** **                                                 | ** **  | ** ** | ** ** |
| Partner capital  contributions                                                   |       | 15,098                                                     |        | 64,666 |   |
| Offering costs                                                                   |       | (100,000                                                   | )           | — |   |
| Partner  distributions                                                           |       | (1,323,000                                                 | )           | (540,000 | ) |
| **Net  cash used in financing activities**                                       | ** ** | **(1,407,902**                                             | **)**       | **(475,334** | **)** |
|                                                                             |       |                                                       |        |   |   |
| **Net  decrease in cash and cash equivalents**                                   | ** ** | **(1,490,801**                                             | **)**       | **(4,640,197** | **)** |
| Cash and cash  equivalents at beginning of period                                |       | 2,366,065                                                  |        | 15,641,945 |   |
| **Cash  and cash equivalents at end of period**                                  | ** ** | **$**                                                      | **875,264** | ** ** | **$** | **11,001,748** | ** ** |
|                                                                             |       |                                                       |        |   |   |
| **Supplemental  disclosure of non-cash investing transactions**                  | ** ** | ** **                                                 | ** **  | ** ** | ** ** |
| Property  additions included in accounts payable to affiliates                   | ** ** | $                                                          | 16,463      |   | $ | 1,214,825 | ** ** |
| Property  additions and asset retirement obligation                              | ** ** | $                                                          | 17,586      |   | $ | 22,439 | ** ** |
| **Supplemental  disclosure of non-cash financing transactions**                  | ** ** |                                                       |        |   | ** ** |
| Managing partner  contributions included in accounts receivable from affiliates  | ** ** | $                                                          | —      |   | $ | 49,629 | ** ** |
| Offering costs  included in accounts payable to affiliates                       | ** ** | $                                                          | 600,000     |   | $ | — | ** ** |
| Offering costs  included in long-term accounts payable to affiliates             | ** ** | $                                                          | 44,789      |   | $ | 804,789 | ** ** |

 

*See accompanying notes tocondensed financial statements.*

 

3

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**Reef Global Energy VI, L.P.**

**Notes toCondensed Financial Statements (unaudited)**

 

**1. Organization and Basis ofPresentation**

 

The financial statementsof Reef Global Energy VI, L.P. (the “Partnership”) have been prepared pursuantto the rules and regulations of the Securities and Exchange Commission(the “SEC”). Certain information and footnote disclosure normally included inannual financial statements prepared in accordance with accounting principlesgenerally accepted in the United States have been condensed or omitted pursuantto those rules and regulations. We have recorded all transactions andadjustments necessary to fairly present the financial statements included inthis Quarterly Report on Form 10-Q (this “Quarterly Report”). Theadjustments are normal and recurring. The following notes describe only thematerial changes in accounting policies, account details, or financialstatement notes during the first three months of 2008. Therefore, please readthese condensed financial statements and notes to condensed financialstatements together with the audited financial statements and notes tofinancial statements contained in the Partnership’s Annual Report on Form 10-Kfor the period ended December 31, 2007 (the “Annual Report”).

 

**2. Summary of Accounting Policies**

 

**Oil and Natural Gas Properties**

 

The Partnership followsthe full cost method of accounting for crude oil and natural gas properties.Under this method, all direct costs and certain indirect costs associated withacquisition of properties and successful as well as unsuccessful explorationand development activities are capitalized. Depreciation, depletion, andamortization of capitalized crude oil and natural gas properties and estimatedfuture development costs, excluding unproved properties, are based on theunit-of-production method using estimated proved reserves. For these purposes,proved gas reserves are converted to equivalent barrels at a rate of 6 Mcf to 1Bbl. Net capitalized costs of crude oil and natural gas properties, as adjustedfor asset retirement obligations, are limited to the lower of unamortized costor the cost ceiling, defined as the sum of the present value of estimated futurenet revenues from proved reserves based on prices in effect at the end of theperiod held constant and discounted at 10 percent, plus the lower of cost orfair value of unproved properties, if any. Pursuant to full cost accountingrules, the Partnership performs a ceiling test quarterly as of the balancesheet date on its proved oil and natural gas properties. Excess capitalizedcosts are charged to property impairment expense. No gain or loss is recognizedupon sale or disposition of crude oil and natural gas properties, unless such asale would significantly alter the rate of depletion and amortization. Duringthe three month periods ended March 31, 2008 and 2007, the Partnershiprecognized property impairment expenses of $0 and $6,333,132, respectively.

 

Unprovedproperties consist of undeveloped leasehold interest. Investments in unprovedproperties are not depleted pending determination of the existence of provedreserves. Unproved properties are assessed for impairment quarterly as of thebalance sheet date by considering the primary lease term, the holding period ofthe properties, geologic data obtained relating to the properties, and otherdrilling activity in the immediate area of the properties. Any impairmentresulting from this quarterly assessment is reported as property impairmentexpense in the current period, as appropriate. During the three months ended March 31,2008 and 2007, the Partnership recognized no impairment of unproved properties.

 

**AssetRetirement Obligations**

 

ThePartnership accounts for its asset retirement obligations in accordance withStatement of Financial Accounting Standards (“SFAS”) No. 143, “Accountingfor Asset Retirement Obligations” (“SFAS No. 143”). Asset retirement costsand liabilities associated with future site restoration and abandonment oflong-lived assets are initially measured at fair value which approximates thecost a third party would incur in performing the tasks necessary to retire suchassets. The fair value is recognized in the financial statements as the presentvalue of expected future cash expenditures for site restoration andabandonment. Subsequent to the initial measurement, the effect of the passageof time on the liability of the net asset retirement obligation (accretionexpense) and the amortization of the asset retirement cost are recognized inthe results of operations.

 

4

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Thefollowing table summarizes the Partnership’s asset retirement obligation forthe three months ended March 31, 2008 and the year ended December 31,2007.

 

| ** **                             | ** ** | **Three months ended  March 31, 2008** | ** ** | **2007** | ** ** |
|----------------------------------------|------------|---------------------------------------------|------------|----------|------------|
| Beginning asset  retirement obligation | ** ** | $                                           | 305,215    |     | $          | 203,803 |   |
| Additions  related to new properties   |       | 17,586                                      |       | 66,996   |       |
| Accretion  expense                     |       | 4,060                                       |       | 34,416   |       |
| Ending asset  retirement obligation    | ** ** | $                                           | 326,861    |     | $          | 305,215 |   |

 

**3. Transactions with Affiliates**

 

The Partnership has noemployees. Reef Exploration, L.P. (“RELP”), an affiliate of the managinggeneral partner, employs a staff including geologists, petroleum engineers,landmen and accounting personnel who administer all of the Partnership’soperations. The Partnership reimburses RELP for technical and administrativeservices at cost. During the three month periods ended March 31, 2008 and2007, the Partnership incurred technical services and administrative coststotaling $122,140 and $293,121, respectively. Of these amounts, $16,463 and$277,186 represent technical services costs capitalized as project costs, and$105,677 and $15,935 represent administrative costs included as general andadministrative expenses.

 

Reef Oil & GasPartners, L.P. (“Reef”), the managing general partner, contributes 1% of allleasehold, drilling and completion costs when incurred. In addition, Reefpurchased 5% of the Partnership units and pays 5% of the 99% of these costspaid by the unit holders (4.95%). During the three month period ended March 31,2007, this 1% obligation totaled $49,629. The Partnership settles its balanceswith Reef and RELP on a quarterly basis.

 

RELP processes jointinterest billings and revenues on behalf of the Partnership. At March 31,2008, RELP owed the Partnership $1,117,683 for net revenues processed in excessof joint interest charges. The cash associated with net revenues processed byRELP is normally received by RELP from oil and gas purchasers 30-60 days afterthe end of the month to which the revenues pertain. At March 31, 2007, thePartnership owed RELP $937,639 in connection with net joint interest charges,primarily related to drilling activities, in excess of revenues processed byRELP.

 

Accounts payable toaffiliates totaled $766,929 and $2,046,606 at March 31, 2008 and 2007,respectively. At March 31, 2008 and 2007, the Partnership owed RELP$122,140 and $291,678 of technical services and administrative costs. At March 31,2007, the Partnership owed Reef $12,500 for expenses paid by Reef on behalf ofthe Partnership.

 

Accounts payable toaffiliates at March 31, 2008 and 2007 also includes $644,789 and $804,789,respectively, for the unpaid portion of the 15% management fee due to Reef fororganization and offering costs, including sales commissions. The managementfee is payable in two parts. Reef initially received reimbursement for actualcommissions and organization and offering costs as incurred, up to a maximum of13.5%. The remaining balance is being paid to Reef from cash flows availablefor partner distributions, at a rate not to exceed $1 million per year. ThePartnership began reimbursing Reef $50,000 per month beginning in January 2008.As such, $600,000 of the balance due has been reclassified as a currentliability at March 31, 2008.

 

**4.Partnership Equity**

 

Information regarding thenumber of units outstanding and the net income (loss) per type of Partnershipunit for the three month periods ended March 31, 2008 and 2007 is detailedbelow:

 

5

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                    For the three months ended March 31, 2008

 

| **Type of Unit**                | ** ** | **Number of Units** | ** ** | **Net income** | ** ** | **Net income per unit** | ** ** |
|---------------------------------|------------|---------------------|------------|----------------|------------|-------------------------|------------|
| Managing general  partner units |       | 75.363              |       | $              | 196,694    |                    | $          | 2,609,96 |   |
| General partner  units          |       | 1,190.561           |       | 646,844        |       | $                       | 543.31     |   |
| Limited partner  units          |       | 241.336             |       | 131,120        |       | $                       | 543.31     |   |
| Total                           |       | 1,507.260           |       | $              | 974,658    |                    |       |   |

 

                    For the three months ended March 31, 2007

 

| **Type of Unit**               | ** ** | **Number of Units** | ** ** | **Net loss** | ** ** | **Net loss per unit** | ** ** |
|--------------------------------|------------|---------------------|------------|--------------|------------|-----------------------|------------|
| Managing general partner units |       | 75.363              |       | $            | (336,850   | )                     | $          | (4,469.70 | ) |
| General partner units          |       | 1,190.561           |       | (5,134,363   | )          | $                     | (4,312.56  | ) |
| Limited partner units          |       | 241.336             |       | (1,040,777   | )          | $                     | (4,312.56  | ) |
|                           |       |                |       |         |       |                  |       |
| Total                          |       | 1,507.260           |       | $            | (6,511,990 | )                     |       |   |

 

**Item 2.  Management’s Discussion and Analysis ofFinancial Condition and Results of Operations.**

 

The following is a discussion of the Partnership’s financialposition, results of operations, liquidity and capital resources. Thisdiscussion should be read in conjunction with our financial statements and therelated notes thereto, included in the Annual Report.

 

This Quarterly Reportcontains forward-looking statements that involve risks and uncertainties. You should exercise extreme caution with respect to all forward-lookingstatements made in this Quarterly Report.  Specifically, the followingstatements are forward-looking:

 

·                                     statements regarding the state of the oiland gas industry and the opportunity to profit within the oil and gas industry,competition, pricing, level of production, or the regulations that may affectthe Partnership;

 

·                                     statements regarding the plans andobjectives of Reef for future operations, including, without limitation, theuses of Partnership funds and the size and nature of the costs the Partnershipexpects to incur and people and services the Partnership may employ;

 

·                                     any statements using the words “anticipate,”“believe,” “estimate,” “expect” and similar such phrases or words; and

 

·                                     any statements of other than historicalfact.

 

Reef believes that it isimportant to communicate its future expectations to the partners. Forward-looking statements reflect the current view of management with respectto future events and are subject to numerous risks, uncertainties andassumptions, including, without limitation, the risk factors listed in thesection captioned “RISK FACTORS” contained in the Reef Global Ventures IIDrilling Program’s (the “Program”) prospectus and prospectus supplement eachdated July 8, 2005. Although Reef believes that the expectations reflectedin such forward-looking statements are reasonable, Reef can give no assurancethat such expectations will prove to have been correct.  Should any one ormore of these or other risks or uncertainties materialize or should anyunderlying assumptions prove incorrect, actual results are likely to varymaterially from those described herein.  There can be no assurance thatthe projected results will occur, that these judgments or assumptions willprove correct or that unforeseen developments will not occur.

 

Reef does not intend toupdate its forward-looking statements.  All subsequent written and oralforward-looking statements attributable to Reef or persons acting on its behalfare expressly qualified in their entirety by the applicable cautionary statements.

 

6

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**Overview**

 

Reef Global Energy VI,L.P. is a Nevada limited partnership formed to acquire, explore, develop andproduce crude oil, natural gas, and natural gas liquids for the benefit of itsinvestor partners. The Partnership’s primary purposes are to generate revenuesfrom the production of oil and natural gas, distribute cash flow to investors,and provide tax benefits to investors. The Partnership purchased workinginterests in twenty developmental prospects. The Partnership participated inthe drilling of eight successful developmental wells on eight developmentalprospects located in Acadia Parish, Louisiana, Pittsburg County, Oklahoma, andPalo Pinto, Jackson, Harris, Galveston, and Lavaca (2 prospects) County, Texas.One well in Lavaca County, Texas and the well in Acadia Parish, Louisiana haveceased production. The Partnership participated in the drilling of elevenunsuccessful developmental wells on eleven developmental prospects located inWest Baton Rouge, Acadia, Calcasieu, and Cameron Parish, Louisiana, and inHardin, Upton, Ector, Jefferson, Lavaca, Reeves, and Dawson County, Texas. ThePartnership has participated in the drilling of eight developmental wells onthe Sand Dunes development prospect in Eddy County, New Mexico. The Partnershipalso purchased working interests in fourteen exploratory prospects, upon whicha total of fourteen exploratory and eight developmental wells have beendrilled. The Partnership participated in the drilling of seven successfulexploratory wells, seven successful developmental wells, and one unsuccessfuldevelopmental well on seven exploratory prospects located in Terrebonne and St.Martin Parish, Louisiana, Sterling, Jefferson (2 prospects) and Live Oak County,Texas, and offshore in U.S. Coastal waters in the Gulf of Mexico. ThePartnership participated in the drilling of seven unsuccessful exploratorywells on seven exploratory prospects located in West Baton Rouge, Beauregard,and Cameron Parish, Louisiana, Brazoria, Lavaca, and San Patricio County,Texas, and offshore in U.S. Coastal waters in the Gulf of Mexico. Of thefourteen successful wells, three wells located in St. Martin and TerrebonneParish, Louisiana and in Live Oak County, Texas have ceased production. A “prospect”is generally defined as a contiguous oil and gas leasehold estate, or lesserinterest in a leasehold estate, upon which drilling operations may beconducted. A prospect may be characterized as “exploratory” or “developmental”based upon the type of well to be drilled on the prospect. A development wellis a well drilled within a proved area of an oil or gas reservoir to the depthof a stratigraphic horizon known to be productive. Generally an exploratorywell is any well that is not a development well, including wells drilled tofind and produce oil or gas in an unproven area, wells drilled to find a newreservoir in a field previously found to be productive of oil or gas, or wellsdrilled to extend a known reservoir. In this Quarterly Report, we use the term “successful”to refer to wells that are drilled, tested, and either capable of or actuallyproducing in commercial quantities. We use the tern “unsuccessful” to refer towells that do not meet one or more of these criteria. The Partnership estimatesthat drilling, completion and facilities expenditures on proved properties willexceed available capital by approximately $807,000. Expenditures in excess ofavailable capital will be deducted from Partnership distributions. The Partnershipdoes not operate in any other industry segment, and operates solely in theUnited States.

 

The table belowsummarizes Partnership drilling expenditures at March 31, 2008 byclassification of well. Drilling, completion, and facilities costs include$285,817 capitalized as asset retirement cost.

 
| ** **          | ** ** | **Leasehold  Costs** | ** ** | **Drilling,  Completion,  and Facilities  Costs** | ** ** | **Total Costs** | ** ** |
|---------------------|------------|----------------------|------------|---------------------------------------------------|------------|-----------------|------------|
| Developmental wells |       | $                    | 1,483,630  |                                              | $          | 18,859,459      |       | $ | 20,343,089 |   |
| Exploratory wells   |       | 1,236,676            |       | 10,927,365                                        |       | 12,164,041      |       |
| Unproved properties |       | 172,930              |       | —                                            |       | 172,930         |       |
| Total               |       | $                    | 2,893,236  |                                              | $          | 29,786,824      |       | $ | 32,680,060 |   |

 

ThePartnership has participated in the drilling of eight wells on its Sand Dunesprospect.  Of the eight Sand Dunesprospect wells that have been drilled, four wells are undergoing extendedtesting and evaluation in order to determine their potential commercialproductivity. ThePartnership estimates that it may take approximately 90 days from the date ofthis Quarterly Report to finish the evaluation process. Following initial testingwhich confirmed the presence of oil and natural gas, the remaining four SandDunes prospect wells were temporarily shut in due to the high cost associatedwith salt water disposal and generator rental. Currently, generators havebeen rented to power the four producing Sand Dunes prospect wells undergoingthe evaluation process, and salt water produced is being trucked off-site by anindependent vendor. In order to reduce overall costs, installation of electricservice to the well-site locations is proceeding, and a more cost effectivemethod of salt water disposal is being explored. To date, RELP, the operator ofthese wells, has been unsuccessful in locating a long-term economic solutionfor disposing of produced salt water; however, RELP is currently evaluating itsoptions for salt water disposal, and the Partnership estimates that it will beat least 90 days from the date of this Quarterly Report for the Sand Dunesprospect to have electricity and efficient salt water disposal capability inplace.

 

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The unproved propertiesowned by the Partnership at March 31, 2008 consist of un-drilled leaseholdinterests (11 potential drilling locations) in the Sand Dunes prospect. ThePartnership does not have available capital to drill these potential locations.The Partnership may sell all or a part of these leasehold interests to thirdparties or other partnerships managed by Reef. However, the Partnership ispermitted to borrow funds or utilize cash flows from existing productiveproperties in order to conduct future developmental drilling on this prospect.Partner approval would not need to be obtained for borrowing activity, as theestimated additional cost is not in excess of 25% of the Partnership’s originalaggregate capital contributions. Until such time as the productive capabilityof the eight Sand Dunes prospect wells already drilled can be fully analyzed,it is unknown whether the Partnership will drill additional wells on the SandDunes prospect or sell all or a portion of the acreage. The estimated cost tothe Partnership of participating in future drilling operations at its currentworking interest ownership is approximately $150,000-$200,000 per location.

 

**CriticalAccounting Policies**

 

There have been no changes from the Critical Accounting Policiesdescribed in the Annual Report.

 

**Liquidity and Capital Resources**

 

The Partnership wasfunded with initial capital contributions totaling $37,398,898. Reef purchased75.363 general partner units, or 5% of the total units sold, for $1,601,464.Investor partners purchased 1,190.561 units of general partner interest and241.336 units of limited partner interest for $35,797,434. As of March 31,2008, Reef has also contributed $296,738 in connection with its obligation topay 1% of all leasehold, drilling, and completion costs. Organization andoffering costs totaled $5,369,615, leaving capital contributions of $32,326,021available for Partnership activities. The Partnership expects to expendapproximately $807,000 in excess of the available capital on the thirty-fivedevelopmental and fourteen exploratory wells referred to above. These funds areexpected to be expended over a period of approximately thirty-eight monthsbeginning in July 2005 through August 2008. Expenditures in excess ofavailable capital will be deducted from Partnership distributions.

 

During this quarter,drilling operations were completed on the final three of eight Sand Dunesprospect wells drilled during 2007 and 2008, and drilling operations werecompleted on a developmental well located in Terrebonne Parish, Louisiana. TheLouisiana well was completed during March and April 2008 and beganproduction operations on May 2, 2008. The three Sand Dunes prospect wellswere shut-in due to the high cost associated with salt water disposal andgenerator rental. Of the eight SandDunes prospect wells drilled, four wells are undergoing extended testing andevaluation in order to determine their potential commercial productivity. ThePartnership estimates that it may take approximately 90 days from the date ofthis Quarterly Report to finish the evaluation process.

 

The Partnership hasworking capital of $1,270,534 at March 31, 2008, which includes a cashdeficit of $206,539 in connection with drilling, completion, and facilitiescosts, $44,789 of deferred organization and offering costs payable to Reef, and$1,432,284 of interest income and net revenues available for distribution toinvestor partners. The Partnership has expended $32,532,560 to date in connectionwith the purchase of leasehold interests, drilling activity, and pre-productionadministrative costs. Excess drilling, completion, and facilities costs will berecovered through a reduction of partner distributions from productive wells.Subsequent to expending the initial available partner capital contributions ondrilling and completion of wells and related facilities, the Partnership hasminimal working capital, primarily consisting of cash and accounts receivablefrom RELP related to oil and gas sales processed by RELP, which the Partnershipwill use to pay monthly cash distributions to investors.

 

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**Results of Operations**

 

The following is acomparative discussion of the results of operations for the periods indicated.It should be read in conjunction with the condensed financial statements andthe related notes to the condensed financial statements included in thisQuarterly Report.

 

The following tableprovides information about sales volumes and oil and natural gas prices for theperiods indicated.

 
| ** **                                                      | ** ** | **For the three months  Ended March 31,** | ** ** |
|-----------------------------------------------------------------|------------|------------------------------------------------|------------|
| ** **                                                      | ** ** | **2008**                                       | ** ** | **2007** | ** ** |
| Sales volumes:                                                  |       |                                           |       |   |   |
| Oil (Barrels)                                                   |       | 6,272                                          |       | 1,574 |   |
| Natural gas  (Mcf)                                              |       | 153,879                                        |       | 59,616 |   |
| Equivalent  barrels of oil (EBO) (6 Mcf equals 1 barrel of oil) |       | 31,919                                         |       | 11,510 |   |
|                                                            |       |                                           |       |   |   |
| Average sales  prices received:                                 |       |                                           |       |   |   |
| Oil (Barrels)                                                   |       | $                                              | 94.26      |   | $ | 55.60 |   |
| Natural gas  (Mcf)                                              |       | $                                              | 8.64       |   | $ | 7.08 |   |

 

Net proved oil andnatural gas reserves of the Partnership at March 31, 2008 and 2007 includeproved developed producing reserves and proved developed non-producingreserves. Net proved oil and natural gas reserves at March 31, 2008 and2007 include only those quantities that we expect to recover commercially usingcurrent prices, costs, existing regulatory practices, and technology as of thedate indicated. Therefore, any changes in future prices, costs, regulations,technology or other unforeseen factors could materially increase or decreasethe proved reserve estimates. Additional development costs required to recoverthese proved reserves are estimated at approximately $271,000 as of March 31,2008. All of the Partnership’s reserves are located in the United States.

 
| **Net proved reserves** | ** ** | **Oil (BBL)** | ** ** | **Gas (MCF)** | ** ** |
|-------------------------|------------|---------------|------------|---------------|------------|
| March 31, 2008     |       | 177,679       |       | 3,461,793     |       |
| March 31, 2007     |       | 71,793        |       | 1,039,105     |       |

 

Estimated proveddeveloped non-producing reserves at March 31, 2008 included in the abovetotals and attributable to the eight Sand Dunes prospect wells and thedevelopmental well in Louisiana that began production operations on May 2,2008 were 73,695 barrels of oil and 1,237,227 Mcf of natural gas.

 

The Partnership madethree discoveries during the last half of 2007 that significantly increasedestimated net proved reserves. These discoveries include the developmental wellon the Gumbo II prospect that began producing in May 2008, the Dolphin Bexploratory well in Brazoria County, Texas that began producing in January 2008,and the HBR Big Gas Unit #1 developmental well in Galveston County, Texas thatbegan producing in September 2007. These three wells have total estimatedproved reserves of 93,386 barrels of oil and 2,520,283 Mcf of natural gas at March 31,2008.  Using a conversion factor of 6 Mcfto 1 barrel of oil, these three wells have approximately 68% of totalPartnership reserves at March 31, 2008. The Partnership expects revenueswill increase during the second quarter of 2008 as a result of the Gumbo IIprospect well that began producing on May 2, 2008.

 

**Three months ended March 31,2008 compared to the three months ended March 31, 2007**

 

Partnership net incometotaled $974,658 during the three month period ended March 31, 2008,compared to a net loss of $6,511,990 for the three month period ended March 31,2007.

 

Partnership revenues were$1,920,280 for the three months ended March 31, 2008 compared to $509,731for the three months ended March 31, 2007. The Dolphin B well and the HBRBig Gas Unit #1 well accounted for $1,102,894, or 57.4%, of total oil andnatural gas revenues for the first three months of 2008 and are the primaryreason for the increase in revenues, along with the increase in average price.Neither of these wells had been drilled at March 31, 2007. The Partnershipexpects further increases in revenues during the second quarter of 2008 inconnection with the Gumbo II prospect well beginning production of oil andnatural gas on operations May 2, 2008.

 

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Production expensesaveraged $10.76 per equivalent barrel of oil produced during the first quarterof 2008 compared to $7.97 per equivalent barrel of oil produced during thefirst quarter of 2007. The Sand Dunes wells undergoing extended testing had anet operating loss totaling $20,246 during the three month period ending March 31,2008. Excluding Sand Dunes revenues and expenses, production expenses averaged$9.50 per equivalent barrel of oil during the first quarter of 2008.

 

During the three monthperiod ended March 31, 2007, the Partnership incurred property impairmentcost totaling $6,333,132. During this quarter, drilling operations werecompleted on three Partnership wells, all of which were unsuccessful, andreserve estimates were reduced on three other Partnership wells that had beendrilled during 2006. These factors resulted in the impairment charge. As aresult of the three large discoveries during the second half of 2007, thePartnership has had no impairment subsequent to the three month period ended June 30,2007. The Partnership does not expect to incur any additional propertyimpairment cost unless unanticipated significant downward adjustments toreserve estimates are required to be made in the future.

 

General andadministrative costs incurred during the three months ended March 31, 2008and 2007 increased from $35,045 in 2007 to $115,824 in 2008. The primary causeof the increase was related to general and administrative costs incurred byRELP in connection with the operations of the Partnership, which rose from$15,935 to $105,677 as a result of the increased well count and activities ofthe Partnership. General and administrative charges are expected to increaseduring the second quarter from the level incurred during the first quarter,primarily as a result of audit fees incurred in connection with the audit ofthe Partnership’s 2007 financial statements and the addition of the Gumbo IIprospect well.

 

**Item 3.Quantitative and Qualitative Disclosures About Market Risk**

 

Not Applicable

 

**Item 4T.Controls and Procedures**

 

**Evaluation of Disclosure Controls and Procedures**

 

As the managing generalpartner of the Partnership, Reef maintains a system of controls and proceduresdesigned to provide reasonable assurance as to the reliability of the financialstatements and other disclosures included in this report, as well as tosafeguard assets from unauthorized use or disposition. The Partnership, underthe supervision and with participation of its management, including theprincipal executive officer and principal financial officer of the Partnership’smanaging general partner, Reef Oil & Gas Partners, L.P., evaluated theeffectiveness of its “disclosure controls and procedures” as such term isdefined in Rule 13a-15(e) under the Securities Exchange Act of 1934,as amended (the “Exchange Act”), as of the end of the period covered by thisQuarterly Report. Based on that evaluation, the principal executive officer and principal financial officer of ourgeneral partner have concluded that the Partnership’s disclosure controls andprocedures are effective to ensure that information required to be disclosed bythe Partnership in reports that it files or submits under the Exchange Act isrecorded, processed, summarized, and reported within the time periods specifiedin Securities and Exchange Commission rules and forms, and includescontrols and procedures designed to ensure that information required to bedisclosed by us in such reports is accumulated and communicated to ourmanagement, including the principal executive officer and principal financialofficer of our general partner, as appropriate to allow timely decisions regardingfinancial disclosure.

 

**Changesin Internal Controls**

 

Therehave not been any changes in the Partnership’s internal controls over financialreporting during the fiscal quarter ended March 31, 2008 that havematerially affected, or are reasonably likely to materially affect, thePartnership’s internal control over financial reporting.

 

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**PART II— OTHER INFORMATION**

 

**Item1.  Legal Proceedings**

 

None.

 

**Item2.  Unregistered Sales of EquitySecurities and Use of Proceeds**

 

**Use of Proceeds**

 

In connection with theRegistration Statement filed on Form S-1 (No. 333-122935) anddeclared effective July 7, 2005, Reef filed a final prospectus for theProgram on July 8, 2005. On July 8, 2005, Reef filed a prospectus supplementdescribing the Partnership and commenced the offering of units in thePartnership. All sales of Partnership units were made through the Program’sdealer-manager, Reef Securities, Inc., and a number of soliciting dealers.The offering terminated October 31, 2005. Under the terms of the offering,a minimum of 40 Partnership units at a price of $25,000 per unit were requiredto be sold in order to form the Partnership. Upon meeting this requirement, thePartnership was formed on July 18, 2005.

 

The Partnershipregistered a total of 400 units of limited partner interests and 1,600 units ofgeneral partner interests. The aggregate offering amount registered was$50,000,000. During the offering period that terminated on October 31,2005, the Partnership sold 1,431.897 units to investor partners, consisting of241.336 units of limited partner interest and 1,190.561 units of additionalgeneral partner interest. Reef purchased 75.363 general partner units, equaling5.00% of the total Partnership units sold. The Partnership did not sell theremaining registered units. Total offering proceeds were $37,398,898. Reef isalso obligated to contribute 1% of all leasehold, drilling, and completioncosts as incurred. At March 31, 2008, Reef had contributed $296,738 to thePartnership in connection with this obligation.

 

All units except thosepurchased by Reef paid a 15% management fee to Reef to pay for the Partnershiporganization and offering costs, including sales commissions. These coststotaled $5,369,615, leaving capital contributions of $32,326,021 available forPartnership oil and gas operations. As of March 31, 2008, the Partnershiphad expended $32,394,243 on property acquisitions and prepayments and $138,317on general and administrative expenses. The Partnership will expend additionalfunds on the completion of one well during the second quarter of 2008, and mayexpend funds on salt water disposal facilities for the wells located on theSand Dunes prospect. Expenditures in excess of available capital will be deductedfrom Partnership distributions.

 

**Item3.  Default Upon Senior Securities**

 

None.

 

**Item4.  Submission of Matters to a Vote ofSecurity Holders**

 

None.

 

**Item5.  Other Information**

 

None.

 

**Item6.  Exhibits**

 

Exhibits

 

                        31.1             Certificationof Principal Executive Officer pursuant to Section 302 of theSarbanes-Oxley Act of 2002.

 

                        31.2             Certificationof Principal Financial Officer pursuant to Section 302 of theSarbanes-Oxley Act of 2002.

 

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                        32.1             Certificationof the Principal Executive Officer pursuant to Section 906 of theSarbanes-Oxley Act of 2002.

 

                        32.2             Certificationof the Principal Financial Officer pursuant to Section 906 of theSarbanes-Oxley Act of 2002.

 

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**SIGNATURES**

 

Pursuant to therequirements of the Securities Exchange Act of 1934, the registrant has dulycaused this report to be signed on its behalf by the undersigned, thereuntoduly authorized.

 
|                                       | REEF GLOBAL ENERGY VI,  L.P. |
|--------------------------------------------|------------------------------|
|                                       |                         |   |
|                                       | By:                     | Reef Oil & Gas  Partners, L.P. |
|                                       |                         | Managing General  Partner |
|                                       |                         |   |
|                                       | By:                     | Reef Oil & Gas  Partners, GP, LLC |
|                                       |                         |   |
| Dated:   May 20,  2008 | By:                     | /s/ Michael J. Mauceli |
| ** **                                 | ** **                   | **Michael J. Mauceli** |
|                                       |                         | Manager and Member |
|                                       |                         | (*Principal  Executive Officer)* |
|                                       |                         |   |
| Dated:   May 20,  2008 | By:                     | /s/ Daniel C. Sibley |
| ** **                                 | ** **                   | **Daniel C. Sibley** |
|                                       |                         | Chief Financial Officer |
|                                       |                         | (*Principal  Financial and Accounting Officer)* |

 

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