SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

          [ X ]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the Quarterly Period Ended June 30, 1999

                         Commission File Number 33-82034


                          INDIANTOWN COGENERATION, L.P.
            (Exact name of co-registrant as specified in its charter)

       Delaware                                       52-1722490
(State or other jurisdiction of         (I.R.S. Employer Identification Number)
incorporation or organization)



                   Indiantown Cogeneration Funding Corporation
            (Exact name of co-registrant as specified in its charter)

       Delaware                                      52-1889595
(State or other jurisdiction of         (I.R.S. Employer Identification Number)
incorporation or organization)



                      7500 Old Georgetown Road, 13th Floor
                          Bethesda, Maryland 20814-6161
              (Registrants' address of principal executive offices)

                                 (301)-718-6800
              (Registrants' 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 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. [ X ] Yes [ ] No


<PAGE>


                          Indiantown Cogeneration, L.P.
                   Indiantown Cogeneration Funding Corporation



PART I  FINANCIAL INFORMATION                                   Page No.

Item 1  Financial Statements:
        Consolidated Balance Sheets as of
          June 30, 1999 (Unaudited) and December 31, 1998...........1
        Consolidated Statements of Operations for the
             Six Months Ended June 30, 1999 (Unaudited)
             and June 30, 1998 (Unaudited)..........................3
        Consolidated Statements of Cash Flows for the
             Six Months Ended June 30, 1999
            (Unaudited) and June 30, 1998 (Unaudited)...............4


        Notes to Consolidated Financial Statements (Unaudited) .....5

Item 2  Management's Discussion and Analysis
             of Financial Condition and Results of Operations.......8

PART II OTHER INFORMATION

Item 1  Legal Proceedings..........................................14

Item 5  Other Information..........................................16

Item 6  Exhibits and Reports on Form 8-K...........................18

Signatures.........................................................19


<PAGE>



                                     PART I
                              FINANCIAL INFORMATION

                          Indiantown Cogeneration, L.P.
                           Consolidated Balance Sheets
                    As of June 30, 1999 and December 31, 1998
<TABLE>
<CAPTION>
<S>                                                                       <C>                       <C>
                                                                                June 30,                  December 31,
                           ASSETS                                                 1999                        1998
--------------------------------------------------------------             -------------------        ---------------------
                                                                              (Unaudited)
CURRENT ASSETS:
     Cash and cash equivalents                                           $          2,019,791       $            2,419,089
     Accounts receivable-trade                                                     13,611,924                   12,369,594
     Inventories                                                                    1,182,230                      940,125
    Prepaids                                                                        1,130,022                      736,700
     Deposits                                                                          44,000                       44,000
    Investments held by Trustee, including restricted funds
        of $2,701,160 and $2,718,549, respectively
                                                                                    3,137,753                    2,770,774
                                                                           -------------------
                                                                                                      ---------------------
               Total current assets                                                21,125,720                   19,280,282

INVESTMENTS HELD BY TRUSTEE,
     restricted funds                                                              14,065,700                   14,001,428

DEPOSITS                                                                               75,000                       75,000

PROPERTY, PLANT & EQUIPMENT:
     Land                                                                           8,582,363                    8,582,363
     Electric and steam generating facilities                                     697,049,583                  695,929,380
     Less accumulated depreciation                                               (58,005,530)                 (50,323,285)
                                                                           -------------------
                                                                                                      ---------------------
               Net property, plant & equipment                                    647,626,416                  654,188,458

FUEL RESERVE                                                                        1,062,459                    3,428,403

DEFERRED FINANCING COSTS, net of accumulated amortization of
    $43,439,465 and $43,020,796, respectively
                                                                                   16,747,451                   17,166,120
                                                                           -------------------        ---------------------

               Total assets                                                     $ 700,702,746                 $708,139,691
                                                                           ===================        =====================

</TABLE>

The  accompanying  notes  are an  integral  part of these  consolidated  balance
sheets.

                                       1
<PAGE>


                         Indiantown Cogeneration, L. P.
                           Consolidated Balance Sheets
                    As of June 30, 1999 and December 31, 1998


<TABLE>
<CAPTION>
<S>                                                               <C>                       <C>


                                                                        June 30,              December 31, 1998
LIABILITIES AND PARTNERS' CAPITAL                                         1999
--------------------------------------------------------------    ---------------------     ----------------------
                                                                      (Unaudited)
CURRENT LIABILITIES:
     Accrued payables/liabilities                             $             10,065,300    $             7,405,610
     Accrued interest                                                        2,284,576                  2,302,048
     Current portion - First Mortgage Bonds                                 10,765,567                  9,997,000
     Current portion lease payable - railcars                                  297,597                    287,048
                                                                  ---------------------     ----------------------
               Total current liabilities                                    23,413,040                 19,991,706

LONG TERM DEBT:
     First Mortgage Bonds                                                  460,475,433                466,242,000
     Tax Exempt Facility Revenue Bonds                                     125,010,000                125,010,000
     Lease payable - railcars                                                4,432,216                  4,583,699
                                                                  ---------------------     ----------------------
               Total long term debt                                        589,917,649                595,835,699

      Reserve-Major Maintenance                                                716,146                    511,756
                                                                  ---------------------     ----------------------
               Total liabilities                                           614,046,835                616,339,161
                                                                  ---------------------     ----------------------

PARTNERS' CAPITAL:
    Toyan Enterprises                                                       26,040,103                 27,586,061
    Palm Power Corporation                                                   8,665,590                  9,180,052
    TIFD III-Y, Inc.                                                        17,417,838                 36,720,212
     Indiantown Project Investment Partnership                              17,287,854                 18,314,205
     Thaleia, LLC                                                           17,244,526                          0

                                                                  ---------------------     ----------------------
               Total partners' capital                                      86,655,911                 91,800,530
                                                                  ---------------------     ----------------------

               Total liabilities and partners'
               capital                                                    $700,702,746               $708,139,691
                                                                  =====================     ======================


</TABLE>

The  accompanying  notes  are an  integral  part of these  consolidated  balance
sheets.

                                       2
<PAGE>





                          Indiantown Cogeneration, L.P.
                      Consolidated Statements of Operations
            For the Six Months Ended June 30, 1999 and June 30, 1998


<TABLE>
<CAPTION>
<S>                                                            <C>                          <C>

                                                                     Six Months                    Six Months
                                                                        Ended                         Ended
                                                                   June 30, 1999                 June 30, 1998
                                                              -------------------------     -------------------------
Operating Revenues:                                                 (Unaudited)                 (Unaudited)
     Electric capacity and capacity bonus revenue

                                                                       $61,792,499                   $61,709,982
     Electric energy revenue                                            14,354,858                    16,793,931
     Steam revenue                                                          61,026                       106,143
                                                                        ----------                    ----------
         Total operating revenues                                       76,208,383                    78,610,056
                                                                        ----------                    ----------


Cost of Sales:

     Fuel and ash                                                       14,865,879                    17,938,553
     Operating and maintenance                                           8,725,799                     8,815,208
     Depreciation                                                        7,682,245                     7,548,096
                                                                         ---------                     ---------
         Total cost of sales                                            31,273,923                    34,301,857
                                                                        ----------                    ----------

Gross Profit                                                            44,934,460                    44,308,199
                                                                        ----------                    ----------


Other Operating Expenses:

     General and administrative                                          2,076,805                     1,405,670
     Insurance and taxes                                                 3,316,904                     3,361,234
                                                                         ---------                     ---------
         Total other operating expenses                                  5,393,709                     4,766,904
                                                                         ---------                     ---------


Operating Income                                                        39,540,751                    39,541,295
                                                                        ----------                    ----------

Non-Operating Income (Expenses):

     Interest/Other expense                                           (28,847,362)                  (29,604,677)
     Interest/Other income                                                 931,992                     1,258,258
                                                                      ------------                  ------------
         Net non-operating expense                                    (27,915,370)                  (28,346,419)
                                                                      ------------                  ------------


Net Income                                                             $11,625,381                   $11,194,876
                                                                       ===========                   ===========

</TABLE>



The accompanying notes are an integral part of these consolidated statements.

                                       3

<PAGE>




             Indiantown Cogeneration, L.P.
         Consolidated Statements of Cash Flows
    For the Six Months Ended June 30, 1999 and 1998


<TABLE>
<CAPTION>
<S>                                                                                 <C>                       <C>
                                                                                        Six Months                Six Months
                                                                                           Ended                     Ended
                                                                                         June 30,                  June 30,
                                                                                           1999                      1998
                                                                                    --------------------     ----------------------
                                                                                    (Unaudited)              (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income                                                                   $          11,625,381 $               11,194,876
         Adjustments to reconcile net income to net
            Cash provided by operating activities:
               Depreciation and amortization                                                  8,100,914                  7,839,403
               Increase in accounts receivable                                              (1,242,330)                   (48,215)
               Decrease in inventories and fuel reserves                                      2,123,839                    124,693
               (Increase) Decrease in deposits and prepaids                                   (393,322)                    299,522
                Increase in accounts payable, accrued liabilities and accrued
             interest                                                                         2,642,218                  1,644,742
               Increase in major maintenance reserve                                            204,390                     90,905
               (Decrease) in lease payable                                                    (140,934)                  (131,120)
                                                                                    --------------------     ----------------------
                       Net cash provided by operating activities                             22,920,156                 21,014,806
                                                                                    --------------------     ----------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
        Purchase of property, plant & equipment                                             (1,120,205)                  (443,690)
       (Increase)Decrease in investment held by trustee                                       (431,251)                 10,205,092
                                                                                    --------------------     ----------------------
                       Net cash (used in) provided by investing activities                  (1,551,454)                  9,761,402
                                                                                    --------------------     ----------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
          Payment of bonds                                                                  (4,998,000)                (5,132,000)
         Capital distributions                                                             (16,770,000)               (26,480,000)
                                                                                    --------------------     ----------------------
                       Net cash used in financing activities                               (21,768,000)               (31,612,000)
                                                                                    --------------------     ----------------------

CHANGE IN CASH AND CASH EQUIVALENTS                                                           (399,298)                  (835,792)
CASH and CASH EQUIVALENTS, beginning of year                                                  2,419,089                  3,234,379
                                                                                    --------------------     ----------------------
CASH and CASH EQUIVALENTS, end of period                                           $          2,019,791                  2,398,587
                                                                                                        $
                                                                                     ===================     ======================

</TABLE>

The accompanying notes are an integral part of these consolidated statements.

                                       4
<PAGE>



                          Indiantown Cogeneration, L.P.

                   Notes to Consolidated Financial Statements
                               As of June 30,1999
                                   (Unaudited)



1.   ORGANIZATION AND BUSINESS:

        Indiantown  Cogeneration,  L.P. (the "Partnership") is a special purpose
Delaware  limited  partnership  formed on October 4, 1991. The  Partnership  was
formed to develop,  construct,  and operate an approximately  330 megawatt (net)
pulverized  coal-fired  cogeneration  facility  (the  "Facility")  located on an
approximately 240 acre site in southwestern Martin County, Florida. The Facility
produces  electricity  for sale to Florida  Power & Light  Company  ("FPL")  and
supplies steam to Caulkins Indiantown Citrus Co.
("Caulkins") for its plant located near the Facility.

        The  original  general  partners  were Toyan  Enterprises  ("Toyan"),  a
California corporation and a wholly-owned special purpose indirect subsidiary of
PG&E Generating Company,  LLC (formerly known as U.S. Generating Company,  LLC),
and Palm  Power  Corporation  ("Palm"),  a  Delaware  corporation  and a special
purpose   indirect   subsidiary   of   Bechtel   Enterprises,   Inc.   ("Bechtel
Enterprises"). The sole limited partner was TIFD III-Y, Inc. ("TIFD"), a special
purpose indirect  subsidiary of General Electric Capital  Corporation  ("GECC").
During  1994,  the  Partnership   formed  its  sole,  wholly  owned  subsidiary,
Indiantown  Cogeneration  Funding  Corporation ("ICL Funding"),  to act as agent
for, and  co-issuer  with,  the  Partnership  in  accordance  with the 1994 bond
offering.

        In 1998, Toyan consummated transactions with DCC Project Finance Twelve,
Inc.  ("PFT"),  whereby  PFT,  through  a new  partnership  (Indiantown  Project
Investment,  L.P.  ("IPILP"))  with Toyan,  became a new general  partner in the
Partnership.  Toyan is the  sole  general  partner  of  IPILP.  Prior to the PFT
transaction,  Toyan  converted some of its general  partnership  interest into a
limited  partnership  interest such that Toyan now directly holds only a limited
partnership  interest  in  the  Partnership.  In  addition,  Bechtel  Generating
Company, Inc. ("Bechtel Generating"),  sold all of the stock of Palm to a wholly
owned indirect subsidiary of Cogentrix Energy, Inc. ("Cogentrix").  Palm holds a
10% general partner interest in the Partnership.

        On June 4, 1999, Thaleia, LLC ("Thaleia"),  a wholly-owned subsidiary of
Palm and indirect  wholly-owned  subsidiary of  Cogentrix,  acquired from TIFD a
19.9%  limited  partner  interest  in the  Partnership.  TIFD has  retained  the
remaining  20.1%  limited  partner  interest and its  membership on the Board of
Control. Thaleia has agreed, subject to certain conditions precedent and certain
termination  rights of both  Thaleia  and TIFD,  to  purchase  TIFD's  remaining
limited  partner  interest  in  the  Partnership  from  TIFD,  including  TIFD's
membership on the Board of Control.

        The net profits and losses of the  Partnership  are  allocated to Toyan,
Palm, TIFD and, if applicable, IPILP and Thaleia (collectively,  the "Partners")
based on the following ownership percentages:


                                       5
<PAGE>

                    As of               As of         As of            As of
                September 20,        August 21,    October 20,        June 4,
                    1997                1998          1998             1999
                    ----                ----          ----             ----
   Toyan            50%               30.05%        30.05%            30.05%
   Palm             10%                  10%          10%*              10%*
   IPILP            --                19.95%**      19.95%**          19.95%**
   TIFD             40%                  40%           40%             20.1%
   Thaleia          --                   --            --              19.9%*

*  Beneficially  owned  by  Cogentrix.
**  PFT's  beneficial  ownership  in the
    Partnership  through IPILP was equal to 10% as of August 21, 1998, and 15%
    as of November 23, 1998.

        The   changes   in   ownership   were  the   subject   of   notices   of
self-recertification of Qualifying Facility status filed by the Partnership with
the Federal Energy Regulatory  Commission on August 20, 1998, November 16, 1998,
and June 4, 1999.

        The  Partnership  is unable to predict the  likelihood  that the pending
Thaleia-TIFD sale will be consummated.

        All  distributions  other than  liquidating  distributions  will be made
based on the Partners'  percentage  interest as shown above,  in accordance with
the  project  documents  and at such  times and in such  amounts as the Board of
Control of the Partnership determines.

        The  Partnership  is managed by PG&E  Generating  Company  ("PG&E Gen"),
formerly known as U.S.  Generating  Company,  pursuant to a Management  Services
Agreement  (the  "MSA").  The  Facility is operated by U.S.  Operating  Services
Company ("USOSC),  pursuant to an Operation and Maintenance  Agreement (the "O&M
Agreement").  PG&E Gen and  USOSC are  general  partnerships  originally  formed
between  affiliates  of  PG&E  Enterprises  and  Bechtel  Enterprises,  Inc.  On
September  19,  1997,  PG&E  Gen and  USOSC  each  separately  redeemed  Bechtel
Enterprises,  Inc.'s  interests  in PG&E Gen and USOSC so that  PG&E  Generating
Company,  LLC now  indirectly  owns all of the  interests in PG&E Gen and USOSC.
This will not affect PG&E Gen's obligations under the MSA or USOSC's obligations
under the O&M Agreement.  Also on September 19, 1997,  Toyan purchased 16.67% of
Palm's  interest in the  Partnership,  which  represents  a 2%  ownership in the
Partnership.

        The Partnership was in the development  stage through  December 21, 1995
and  commenced  commercial  operations  on December  22,  1995 (the  "Commercial
Operation  Date").  The  original  partners  contributed,  pursuant to an equity
commitment  agreement,  approximately  $140,000,000  of equity  when  commercial
operation  of  the  Facility  commenced  in  December  1995.  The  Partnership's
continued  existence is dependent on the ability of the  Partnership  to sustain
successful operations.  Management of the Partnership is of the opinion that the
assets of the Partnership are realizable at their current carrying value.


2.      FINANCIAL STATEMENTS:


        The   consolidated   balance  sheets  as  of  June  30,  1999,  and  the
consolidated  statements of  operations  and cash flows for the six months ended
June 30, 1999 and 1998, have been prepared by

                                       6
<PAGE>

the Partnership,  without audit and in accordance with the rules and regulations
of the Securities and Exchange Commission.  In the opinion of management,  these
financial  statements  include  all  adjustments   (consisting  only  of  normal
recurring adjustments) necessary to present fairly the financial position of the
Partnership  as of June 30, 1999,  and the results of operations  and cash flows
for the six months ended June 30, 1999 and 1998.

        The financial  statements and related notes  contained  herein should be
read in conjunction  with the  Partnership's  Annual Report on Form 10-K for the
year ended December 31, 1998.


Investments Held by Trustee


        The investments  held by trustee  represent bond and equity proceeds and
revenue funds held by a bond trustee/disbursement agent and are carried at cost,
which  approximates  market.  All funds are invested in either Nations  Treasury
Fund-Class A or other permitted  investments for longer periods. The Partnership
also maintains  restricted  investments  covering a portion of the Partnership's
debt as required by the financing documents. The proceeds include $12,501,000 of
restricted  tax-exempt debt service reserve required by the financing  documents
and are classified as a noncurrent asset on the accompanying balance sheets. The
Partnership  maintains  restricted   investments  covering  a  portion  of  debt
principal and interest payable,  as required by the financing  documents.  These
investments  are classified as current assets in the  accompanying  consolidated
balance  sheets.  A qualifying  facility  ("QF") reserve of $1.5 million is also
held in long term assets in the accompanying balance sheets.


Property, Plant and Equipment

        Property, plant and equipment,  which consist primarily of the Facility,
are recorded at actual  cost.  The Facility is  depreciated  on a  straight-line
basis over 35 years,  with a residual  value on the  Facility  approximating  25
percent of the gross Facility costs.

        Other property and equipment are  depreciated on a  straight-line  basis
over the estimated  economic or service lives of the respective  assets (ranging
from five to seven  years).  Routine  maintenance  and  repairs  are  charged to
expense as incurred.

3.  DEPOSITS:


        In 1991,  in  accordance  with a contract  between the  Partnership  and
Martin County, the Partnership provided Martin County with a security deposit in
the amount of  $149,357  to secure  installation  and  maintenance  of  required
landscaping  materials.  In January 1998, the  Partnership  received a refund of
funds  in  excess  of the  required  deposit  as  security  for the  first  year
maintenance  as set forth in the  contract  between the  Partnership  and Martin
County.  The remaining  deposit in the amount of $39,804 was included in current
assets in the  consolidated  balance sheet as of December 31, 1997.  These funds
were returned in September 1998 when the Partnership submitted a surety bond for
the refund amount. In July 1999,  Martin County Growth Management  Environmental
Division authorized release of the funds securing the landscaping.

        In  1991,  in  accordance  with  the  Planned  Unit  Development  Zoning
Agreement between the Partnership and Martin County,  the Partnership  deposited
$1,000,000 in trust with the Board of County Commissioners of Martin County (the
"PUD  Trustee").  Income  from  this  trust  will be used  solely  for  projects
benefiting  the community of  Indiantown.  On July 23, 2025,  the PUD Trustee is
required  to return the  deposit  to the  Partnership.  As of June 30,  1999 and
December 31, 1998,

                                       7
<PAGE>

estimated present values of this deposit was $75,000.  The remaining balance has
been included in property  plant,  and  equipment as part of total  construction
expenses.



Item 2         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                      CONDITION AND RESULTS OF OPERATIONS

        The  following  discussion  should  be  read  in  conjunction  with  the
Consolidated  Financial  Statements  of the  Partnership  and the notes  thereto
included elsewhere in this report.

General


        The Partnership is primarily engaged in the ownership and operation of a
non-utility electric generating facility.  From its inception and until December
21, 1995,  the  Partnership  was in the  development  stage and had no operating
revenues or expenses.  On December 22, 1995 the  Facility  commenced  commercial
operation.  As of June 30, 1999, the Partnership had approximately  $648 million
of property,  plant and equipment (net of accumulated  depreciation)  consisting
primarily of purchased  equipment,  construction  related  labor and  materials,
interest  during   construction,   financing  cost,  and  other  costs  directly
associated with the construction of the Facility.  For the six months ended June
30, 1999, the Partnership had total operating  revenues of  approximately  $76.2
million, total operating costs of $36.7 million, and total net interest expenses
of approximately  $27.9 million  resulting in net income of approximately  $11.6
million.


        The  Partnership  is engaged in litigation  with FPL, the  Partnership's
primary source of revenue. Under certain circumstances, an adverse ruling in the
litigation  could have a material adverse effect on the  Partnership's  business
and financial  condition.  Please see Part II, Item 1, Legal Proceedings,  for a
description of the  litigation,  and Part II, Item 5, Other  Information,  for a
description  of the  Partnership's  options  to  mitigate  the risk  posed by an
adverse ruling in such litigation.


        The  Partnership  has obtained all  material  environmental  permits and
approvals  required as of June 30,  1999,  for the  operation  of the  Facility.
Certain of these permits and approvals are subject to periodic renewal.  Certain
additional  permits  and  approvals  will  be  required  in the  future  for the
continued  operation of the Facility.  The Partnership is not presently aware of
any technical  circumstances that would prevent the issuance of such permits and
approvals or the renewal of currently existing permits.


        The Partnership timely filed its application for a Title V air permit on
May 24,  1996.  A final  draft  permit was issued by the Florida  Department  of
Environmental  Protection for comments by the Federal  Environmental  Protection
Agency ("EPA"). The EPA has responded with questions to which the Partnership is
preparing  answers.  Based upon the extent of EPA's  inquiries,  the Partnership
does not anticipate difficulties in obtaining a final Title V air permit.

Results of Operations
---------------------


        For the six months ending June 30, 1999 and 1998, the Facility  achieved
an average  Capacity  Billing Factor of 100.94% and 101.17%  respectively.  This
resulted in earning  monthly  capacity  payments  aggregating  $56.2 million and
$56.1  million and bonuses  aggregating  $5.6 million for each of the six months
ended June 30, 1999 and 1998, respectively. The Capacity Billing Factor measures
the overall  availability  of the  Facility,  but gives a heavier  weighting  to
on-peak availability.  During

                                       8

<PAGE>

the six months  ended  June 30,  1999 the  Facility  was  dispatched  by FPL and
generated 616,585  megawatt-hours  compared to 707,874 megawatt-hours during the
same period in 1998.  The decrease was primarily due to mild winter  weather and
the  refusal of FPL to  reconnect  the  Facility  to the  distribution  grid for
nineteen days in March 1999 (see Legal Proceedings  below). The monthly dispatch
rate for the first six months of 1999  ranged  from 18% to 67% as  compared to a
range of 35% to 74% for the corresponding period in 1998.


        Net income for the six months  ended  June  30,1999,  was  approximately
$11.6 million compared to the net income of approximately  $11.2 million for the
corresponding  period in the prior year. The $0.4 million  increase is primarily
attributable to lower  operations and  maintenance  costs of $0.8 million due to
lower routine maintenance and material costs and fewer spare parts purchases and
lower net interest expense of $0.3 million. This is offset by higher general and
administrative and other operating costs of $0.7 million for addressing the year
2000  system  issues,  for  operations  support,  and for legal fees for the FPL
litigation.


Electric Energy Revenues


<TABLE>
<CAPTION>
                                                  For the six months ended
<S>                                        <C>                  <C>
                                           June 30, 1999        June 30, 1998
                                           -------------        -------------

Revenues                                   $76.2 million        $78.6 million
KWhs                                       616.5                707.9
Average Capacity Billing Factor            100.94%              101.17%
Average Dispatch Rate                       43.15%               53.6%
</TABLE>


        For the six  months  ended  June 30,  1999,  the  Partnership  had total
operating  revenues of approximately  $76.2 million as compared to $78.6 million
for the  corresponding  period in the prior year.  The $2.4 million  decrease in
operating  revenue is primarily due to lower energy revenue resulting from lower
dispatch by FPL because of mild winter  weather and FPL's  refusal to  reconnect
the facility in March (see Legal Proceedings below).

        Costs  of  revenues  for  the six  months  ended  June  30,  1999,  were
approximately  $31.3  million  on sales of  616,585  MWhs as  compared  to $34.3
million on sales of 707,874 MWhs for the corresponding period in the prior year.
This decrease is largely  attributable  to a $3.0 million  decrease in fuel as a
result of lower  dispatch  and  decrease in ash disposal  costs  resulting  from
savings on the ash disposal agreement.

        Total other  operating  expenses for the six months ended June 30, 1999,
were  approximately  $5.4  million  compared to the $4.8  million of total other
operating  expenses  for the  corresponding  period in the prior year.  The $0.6
million increase is due to higher general and administrative expenses to address
the year 2000 system issues and additional  corporate  support from  operations,
and legal expenses for the FPL litigation.

        Net  interest  expense  for the six  months  ended  June 30,  1999,  was
approximately  $27.9 million  compared to $28.3 million of net interest  expense
for the same period in the prior year. The $0.4 million decrease was caused by a
decrease in interest expense due to the maturity of Series A-5 and Series A-6 of
the First Mortgage Bonds and from lower fees resulting from the reduction in the
debt service letter of credit.



                                       9
<PAGE>
Liquidity and Capital Resources
-------------------------------

        On  November  22, 1994 the  Partnership  and ICL  Funding  issued  first
mortgage  bonds in an  aggregate  principal  amount of $505  million (the "First
Mortgage Bonds"), $236.6 million of which bear an average interest rate of 9.26%
and $268.4  million of which bear an interest rate of 9.77%.  Concurrently  with
the  Partnership's  issuance  of its First  Mortgage  Bonds,  the Martin  County
Industrial  Development Authority issued $113 million of Industrial  Development
Refunding  Revenue  Bonds  (Series  1994A) which bear an interest rate of 7.875%
(the "1994A Tax Exempt  Bonds").  A second  series of tax exempt  bonds  (Series
1994B) in the approximate amount of $12 million,  which bear an interest rate of
8.05%,  were issued by the Martin  County  Industrial  Development  Authority on
December 20, 1994 (the "1994B Tax Exempt Bonds" and, together with the 1994A Tax
Exempt Bonds,  the "1994 Tax Exempt  Bonds").  The First  Mortgage Bonds and the
1994 Tax Exempt Bonds are hereinafter collectively referred to as the "Bonds."

        Certain proceeds from the issuance of the First Mortgage Bonds were used
to repay $421 million of the  Partnership's  indebtedness and financing fees and
expenses  incurred in connection with the  development  and  construction of the
Facility and the balance of the proceeds  were  deposited in various  restricted
funds that are being administered by an independent  disbursement agent pursuant
to trust  indentures and a disbursement  agreement.  Funds  administered by such
disbursement agent are invested in specified  investments.  These funds together
with other funds  available to the  Partnership  were being used: (i) to finance
completion of construction, testing, and initial operation of the Facility; (ii)
to finance  construction  interest  and  contingency;  and (iii) to provide  for
initial working capital.

        The  proceeds  of the 1994 Tax  Exempt  Bonds  were used to refund  $113
million principal amount of Industrial  Development  Revenue Bonds (Series 1992A
and Series 1992B) previously issued by the Martin County Industrial  Development
Authority  for the  benefit of the  Partnership,  and to fund,  in part,  a debt
service reserve  account for the benefit of the holders of its tax-exempt  bonds
and to complete construction of certain portions of the Facility.


     The  Partnership's  total borrowings from inception  through June 1999 were
$769  million.  The equity loan of $139 million was repaid on December 26, 1995.
As of March 31, 1999,  the  borrowings  included  $125 million from the 1994 Tax
Exempt Bonds and all of the available  First Mortgage Bond  proceeds.  The First
Mortgage Bonds have matured as follows:


<TABLE>
<CAPTION>
<S>               <C>                                <C>

Series            Aggregate Principal Amount         Date Matured and Paid
------            --------------------------         ---------------------


A-1                         $4,397,000                    June 15, 1996
A-2                          4,398,000                    December 15, 1996
A-3                          4,850,000                    June 15, 1997
A-4                          4,851,000                    December 15, 1997
A-5                          5,132,000                    June 15, 1998
A-6                          5,133,000                    December 15, 1998
A-7                          4,998,000                    June 15, 1999

</TABLE>

The weighted  average  interest rate paid by the Partnership on its debt for the
six months ended June 30, 1999 and 1998, was 9.167% and 9.176%, respectively.



                                       10
<PAGE>

        The  Partnership,  pursuant  to certain  of the  Project  Contracts,  is
required to post letters of credit  which,  in the  aggregate,  will have a face
amount of no more than $65 million. Certain of these letters of credit have been
issued  pursuant to a Letter of Credit and  Reimbursement  Agreement with Credit
Suisse and the remaining  letters of credit will be issued when  required  under
the Project Contracts,  subject to conditions contained in such Letter of Credit
and Reimbursement  Agreement. As of June 30, 1999, no drawings have been made on
any of these letters of credit. The Letter of Credit and Reimbursement Agreement
has a term of seven years  subject to extension at the  discretion  of the banks
party thereto.

        The Partnership entered into a debt service reserve letter of credit and
reimbursement agreement,  dated as of November 1, 1994, with Banque Nationale de
Paris pursuant to which a debt service reserve letter of credit in the amount of
approximately $60 million was issued.  Such agreement has a rolling term of five
years,  subject to  extension  at the  discretion  of the banks  party  thereto.
Drawings on the debt service  reserve  letter of credit became  available on the
Commercial  Operation  Date of the Facility to pay principal and interest on the
First  Mortgage  Bonds,  the 1994 Tax  Exempt  Bonds and  interest  on any loans
created by  drawings on such debt  service  reserve  letter of credit.  Cash and
other  investments held in the debt service reserve account will be drawn on for
the Tax Exempt Bonds prior to any drawings on the debt service reserve letter of
credit.  As of June 30,  1999,  no drawings  have been made on the debt  service
reserve letter of credit.

        In order to provide for the  Partnership's  working  capital needs,  the
Partnership  entered into a Revolving  Credit Agreement with Credit Suisse dated
as of  November 1, 1994.  Such  Agreement  has a term of seven years  subject to
extension at the  discretion of the banks party  thereto.  The revolving  credit
agreement has a maximum  available  amount of $15 million and may be drawn on by
the  Partnership  from time to time.  The  interest  rate is based upon  various
short-term indices at the Partnership's option and is determined  separately for
each draw. As of June 30, 1999,  ten working  capital loans had been made to the
Partnership  under the working capital loan facility.  All working capital loans
were repaid.

Year 2000
---------

        The  Partnership  is,  with  the  assistance  of  USOSC  and  PG&E  Gen,
conducting a review of its computer  systems to identify,  test where necessary,
and remediate the systems that could be affected by the new millennium. The year
2000 may pose problems in software  applications  because many computer  systems
and applications currently use two-digit date fields to designate a year. As the
century date occurs,  date sensitive systems may recognize the year 2000 as 1900
or not at all. This potential  inability to recognize or properly treat the year
2000  may  cause  systems  to  process  financial  or  operational   information
incorrectly.  Management  has  inventoried  those  systems  which it  reasonably
believes may be adversely  affected and prioritized  them based on the extent of
any potential disruption in operations and the resulting potential impact on the
Partnership's ability to generate and deliver electricity or steam.

        To date, the Partnership has inventoried ninety-one potentially affected
systems,  of which  forty-eight  have  been  classified  as having  the  highest
priority  based upon  likelihood  and extent of impact.  This  highest  priority
classification is often referred to as "mission  critical." Among these priority
systems is the  Facility's  Distributed  Control  System  ("DCS"),  which is the
primary  computerized  control system for the Facility.  The manufacturer of the
Facility's   DCS  is   Westinghouse   Electric   Corporation   ("Westinghouse").
Westinghouse  visited  the  Facility  to  determine  what  remediation  would be
required for the DCS to be insulated from  disruptions  due to the year 2000 and
installed hardware and software code as required to address the year 2000 issue.

                                       11
<PAGE>

On October 17, 1998, the  Partnership  conducted a year 2000 test on the DCS by,
among other things,  manually  resetting the internal calendar to experience the
transition  from  December  31, 1999 to January 1, 2000.  The DCS  handled  this
simulated  transition with no significant  interruptions  in power production or
ordinary  operation.  Other highest priority systems that demonstrated year 2000
issues during testing have been remediated  including the HART communicators and
the Continuous  Emissions  Monitoring  System.  In addition,  the Partnership is
utilizing a network test  environment  developed by the Partnership with support
from PG&E Gen to test other  information  technology  systems.  This  testing is
conducted  on an  integrated  and unit  basis.  The  integrated  system  test is
intended to replicate the  Partnership's  typical business  processes.  The unit
tests supplement the integrated test to evaluate remaining  functions which were
not part of the integrated  test. The Partnership has either retired or upgraded
all of its computer servers and the computer for the Turbine Vibration  Analysis
System  has been  replaced.  Additionally,  telephone  system  was  successfully
tested.

        Through June 30, 1999, the Partnership spent  approximately  $415,449 on
year  2000  related  projects.  The  Partnership  currently  estimates  that the
completion of its year 2000 efforts will cost approximately  $425,000 (including
amounts spent to date),  encompassing  remediation  and replacement of equipment
(including  the DCS  described  above),  the  performance  of Facility  testing,
communication  with and evaluation of third party  readiness and the development
of required  contingency  plans.  This estimate is based solely upon information
currently  available to the Partnership  and may be revised as more  information
becomes  available.  The  Partnership  has no employees  and has been  utilizing
employees of PG&E Gen provided  pursuant to the MSA.  The  Partnership  does not
separately  track  the  costs  for  year  2000  work by PG&E Gen  employees  and
independent consultants provided pursuant to the MSA. Such costs are principally
the related payroll costs for PG&E Gen employees and the costs of payments under
independent  consulting  constracts  by  PG&E  Gen,  which  are  charged  to the
Partnership under the MSA.

        In  addition,  the  Partnership  recognizes  that it is  dependent  upon
numerous   third  parties  in  the  conduct  of  its  business.   A  significant
interruption in services or resources  provided by such third parties could have
material adverse financial consequences on the Partnership.  These third parties
include those  supplying fuel and other operating  supplies,  as well as FPL and
its  ability to continue to accept the output of the  Facility.  Therefore,  the
Partnership  has sent out 187  inquiries to vendors,  suppliers,  customers  and
other businesses seeking information on the status of such companies'  equipment
and  year  2000  remediation   efforts.  The  Partnership  believes  that  FPL's
preparedness  to perform  under the PPA is the most  important  status of any of
these parties.  The  Partnership  has sent FPL two inquiries with respect to its
year 2000 preparedness but has not yet received a response.  The Partnership has
also reviewed FPL's internet and securities  filings  disclosure on this matter,
which have been insufficient for the Partnership to evaluate FPL's readiness for
the  year  2000.  However,  FPL has  reported  to the  North  American  Electric
Reliability  Council  ("NERC") that it meets NERC's Year 2000 Ready criterion as
set forth in NERC's  report dated August 3, 1999. To date,  the other  responses
and  disclosures  from parties other than FPL have not  identified any year 2000
issues of which the  Partnership  had been unaware.  However,  the responses and
disclosures  have also not been  sufficient  to  ensure  that  there  will be no
impacts on the Partnership as a result of the year 2000 affecting  parties doing
business with the Partnership. To the extent that the Partnership is not able to
gain such adequate assurances,  the Partnership is completing  contingency plans
to mitigate the consequences of potential disruptions.

        These contingency plans are also required because testing, by its nature
cannot comprehensively address all future combinations of dates and events. Some
uncertainty  will  remain  after  testing  as to the  ability of code to process
future  dates,  as well  as the  ability  of  remediated

                                       12
<PAGE>

systems to work in an integrated fashion with other systems. In addition,  until
the year 2000 occurs, no certainty can be assured with respect to external party
preparedness.   The  Partnership's  contingency  plans  take  into  account  the
possibility of multiple system failures,  both internal and external, due to the
year 2000. These  contingency  plans build upon existing  emergency and business
restoration  plans.  The events that the Partnership is considering for planning
purposes include increased frequency and duration of interruptions of the power,
computing,  financial and communications  infrastructure.  Due to the inherently
uncertain nature of the contingencies for which plans are being prepared,  it is
uncertain  whether the  Partnership's  contingency  plans to address  failure of
external  parties or internal  systems will be  sufficient to reduce the risk of
material impacts on the Partnership's  operations due to year 2000 problems. The
Partnership has completed its risk  assessment and contingency  planning for its
priority systems.  The Partnership will continue to perform work associated with
contingency planning implementation through the end of 1999.


        The   Partnership  is  concerned   about  isolated   failures  of  FPL's
transmission system. FPL is important to the Partnership because it provides the
Partnership  with the  Partnership's  only access to the  electric  transmission
system.  Because FPL has provided  insufficient  responses to the  Partnership's
inquiries,  the  Partnership  is compelled to rely on FPL's report to NERC which
the Partnership cannot independently  verify.  However,  nothing has come to the
attention of the  Partnership  that would lead the  Partnership to conclude that
failures  of  FPL's  transmission  system  are  reasonably  likely.   While  the
Partnership's  revenues  will not be  adversely  affected by FPL's  inability to
accept the  Facility's  output,  it could be affected if lack of start-up  power
from FPL prevented the Partnership from restarting the Facility after an outage.
Therefore, the Partnership has a contingency plan pursuant to which it will rent
a diesel  generator  to  enable  the  Facility  to start  without  regard to the
availability of power from FPL. The only  reasonably  likely worst case scenario
identified by the Partnership is localized telephone problems due to congestion.
The  Partnership's  contingency plans call for availability of two-way radios as
well as additional personnel for face-to-face communication, if required.


        Notwithstanding the Partnership's efforts, management of the Partnership
is unable to determine whether or not, as a result of the year 2000, disruptions
will occur or whether such disruptions, if they do occur, will materially impair
the ability of the Partnership to conduct its business.



                                     PART II
                                OTHER INFORMATION

Item 1  LEGAL PROCEEDINGS


Dispute with FPL
----------------


        On March 19, 1999, the Partnership  filed a complaint against FPL in the
United States  District  Court for the Middle  District of Florida.  The lawsuit
stems from a course of action  pursued by FPL since March 10, 1999, in which FPL
has  purported  to exercise  its  dispatch  and control  rights  under the Power
Purchase Agreement in a manner which the Partnership believes violates the terms
of the power sales  agreement.  In its complaint,  the Partnership  charges that
such conduct is deliberately calculated to cause the Partnership to be unable to
meet the requirements to maintain the Facility's status as a Qualifying Facility
under the Public Utility Regulatory Policies Act of 1978.

                                       13
<PAGE>

        The  complaint  alleges  that FPL has  taken  the  position  that if the
Facility is off-line for any reason,  then FPL is under no  obligation  to allow
the Facility to reconnect to FPL's system. The complaint asserts,  however, that
the Partnership specifically and successfully negotiated for a contractual right
to operate  the  Facility  at 100 MW  ("Minimum  Load") in order to enable it to
cogenerate  sufficient steam to maintain its Qualifying  Facility status.  While
FPL has not disputed that the Partnership  may maintain  Minimum Load operations
if the  Facility  is  delivering  power when FPL  requests  the  Partnership  to
decommit the Facility,  the  complaint  states that, if the Facility is off-line
for any reason,  FPL has claimed  absolute  discretion  to deny the  Partnership
permission to reconnect the Facility with FPL's system.

        Because the loss of Qualifying Facility status may result in an event of
default under the Power Purchase Agreement,  the Partnership must take action to
address this matter.  The Partnership is investigating  various  alternatives to
mitigate its QF risk.
These are described under "QF Mitigation Options" in Item 5 below.

        The complaint asserts causes of action for (i) FPL's breach of the Power
Purchase  Agreement,  (ii) FPL's anticipatory  repudiation of the Power Purchase
Agreement,  (iii) breach of the implied covenant of good faith, fair dealing and
commercial  reasonableness  and (iv) a declaratory  judgment by the court of the
rights of the parties under the Power Purchase Agreement.  The Partnership seeks
(a) a declaratory  ruling that FPL's actions constitute a breach of the terms of
the Power Purchase  Agreement and that the Partnership has the absolute right to
operate  the  Facility at Minimum  Load  (except for reasons of safety or system
security)  at the  rates  provided  for in the  Power  Purchase  Agreement,  (b)
injunctive  relief  preventing  FPL from further  violating  the Power  Purchase
Agreement,  (c) compensatory  damages and (d) other relief as the court may deem
appropriate.

        Subsequent to the filing of the complaint,  FPL reconnected the Facility
to FPL's  system on  Sunday,  March 28,  1999.  On April 14,  1999,  FPL filed a
responsive  pleading to the  complaint  including a motion to dismiss two of the
four counts raised in the complaint,  raising certain  affirmative  defenses and
seeking  declaration  that FPL has  unfettered  dispatch  rights under the Power
Purchase  Agreement.  On April 23, 1999, FPL filed an answer to the counts which
were not challenged in the motion to dismiss.  On May 13, 1999, the  Partnership
filed its  response  to FPL's  motion to dismiss  and  request  for  declaratory
judgement.  On May 18,  1999,  the Court  denied  FPL's Motion to Dismiss in its
entirety.  The Partnership filed an amended complaint which was accepted on June
17, 1999. The amended complaint simply consolidated the Partnership's claims for
breach of contract and breach of the implied  obligation  of good faith and fair
dealing which was, in part, in response to a recent federal court decision.  FPL
has moved to dismiss the entire amended  complaint and the Partnership filed its
opposition  papers on August 2,  1999.  The Court has also  ordered a  mediation
session. In addition,  a trial period has been established by the Court in March
2001.

        This summary of the Partnership's  complaint against FPL is qualified in
its  entirety  by the  complaint,  which  was  filed  with the  court in  docket
99-317-CIV-ORL-19C.  This summary does not, nor does it purport to,  include all
of the  material  statements  and  claims  made in the  complaint,  and has been
provided solely for the reader's convenience. This summary is not intended to be
relied upon for any purpose without reference to the complaint.


                                       14
<PAGE>

Item 5  OTHER INFORMATION


QF Mitigation Options
---------------------

         If the court rules against the  Partnership in the litigation with FPL,
the  Facility  could  lose its QF  status,  unless  the  Partnership  is able to
implement  mitigating  action.  Loss of QF  status  would  result in an event of
default  under the Power  Purchase  Agreement  and the  indenture for the Bonds.
Unless cured, such events of default would have a material adverse effect on the
Partnership's business, results of operation and financial condition.

        To  mitigate  the risk of a possible  adverse  ruling by the court,  the
Partnership is analyzing the feasibility of various options. The analyses, which
are in the preliminary stage, include the following:

o    providing steam to Caulkins for refrigeration

o    constructing  a liquid  carbon  dioxide  production  facility  to which the
     Facility would supply steam

o    installing distilled water production equipment to which the Facility would
     supply steam

o    providing  steam for a facility to dry chicken  manure at a nearby farm for
     use as a fertilizer

o    providing steam to Caulkins to dry orange peels for use in cattle feed

o    providing steam to Caulkins for wash-water cooling

o    providing steam or chilled water for water temperature  control at a nearby
     fish farm

o    constructing a cold storage food distribution  center to which the Facility
     would supply chilled water

o    providing chilled water to a nearby hen house for cooling

o    constructing a lumber kiln to dry wood using steam provided by the Facility

o    providing chilled water to a nearby flour mill for temperature control

     The options being analyzed are subject to further  analysis and completion.
This  includes  an  evaluation  as to whether  or not the steam  usage for these
alternatives  would  qualify for QF purposes and inclusion on this list does not
imply that an  affirmative  conclusion  on this matter has been  reached.  Other
options may be considered in addition to the foregoing.  Before the  Partnership
can  determine  whether or not to  implement  an option,  if any option is to be
implemented,  the  Partnership  needs to determine  each option's  feasibility -
whether  the option can  increase  steam  production  on a  schedule,  which may
include  regulatory  approval,  that would assure maintenance of QF status at an
acceptable cost to the Partnership. The Partnership may defer a decision whether
or not to implement any option until a judgment is made in the  litigation  with
FPL. If any option is implemented, the Partnership expects, subject to the terms
of the indenture for the Bonds,  to finance such option with senior secured debt
ranking pari passu with the Bonds.

     No assurance  can be given that the analysis  will be  completed,  that the
completion of the analysis will result in the implementation of any option, that
any option  under  consideration  or any other option will be  determined  to be
feasible or that,  even if one or more  options are  determined  to be feasible,
that  such  option(s)  will  be  implemented  or will  result  in  assuring  the
maintenance of QF status.

                                       15
<PAGE>

Governmental Approvals
----------------------


        The  Partnership  has obtained all  material  environmental  permits and
approvals  required,  as of June  30,  1999,  in order  to  continue  commercial
operation of the Facility. Certain of these permits and approvals are subject to
periodic renewal.  Certain  additional permits and approvals will be required in
the future for the continued  operation of the Facility.  The Partnership is not
aware of any  technical  circumstances  that would  prevent the issuance of such
permits  and  approvals  or  the  renewal  of  currently  issued  permits.   The
Partnership  timely  filed its  application  for a Title V air permit on May 24,
1996.  A draft  permit was issued by the  Florida  Department  of  Environmental
Protection for comments by Federal Environmental  Protection Agency. The EPA has
responded with questions to which the  Partnership is preparing  answers.  Based
upon the  extent  of  EPA's  inquiries,  the  Partnership  does  not  anticipate
difficulties in obtaining a final Title V air permit.


Energy Prices
-------------

        In September 1997, FPL filed with the Florida Public Service  Commission
its projections for its 1997-1999 "as available"  energy costs (in this context,
"as available"  energy costs reflect actual energy  production  costs avoided by
FPL resulting from the purchase of energy from the Facility and other Qualifying
Facilities). The projections filed by FPL are lower for certain periods than the
energy prices  specified in the Power  Purchase  Agreement  for energy  actually
delivered by the Facility.  At other times,  the  projections  exceed the energy
prices  specified in the Power Purchase  Agreement.  Should FPL's "as available"
energy cost projections  prove to reflect actual rates, FPL may elect,  pursuant
to its  dispatch  and control  rights over the  Facility  set forth in the Power
Purchase  Agreement,  to run the Facility less frequently or at lower loads than
if the Facility's energy prices were lower than the cost of other energy sources
available to FPL. Because capacity  payments under the Power Purchase  Agreement
are not affected by FPL's dispatch of the Facility and because capacity payments
are expected by the Partnership to cover all of the  Partnership's  fixed costs,
including debt service,  the  Partnership  currently  expects that, if the filed
projections prove to reflect actual rates, such rates and the resulting dispatch
of the Facility  will not have a material  adverse  effect on the  Partnership's
ability to service its debt.  To the extent the  Facility is not operated by FPL
during Caulkins' processing season (November to June), the Partnership may elect
to run the  Facility  at a  minimum  load  or shut  down  the  Facility  and run
auxiliary  boilers to produce steam for Caulkins in amounts  required  under the
Partnership's  steam  agreement  with  Caulkins.  The  Partnership  has  filed a
complaint  against FPL with respect to the  interpretation of a provision of the
Power   Purchase   Agreement   related  to  this   matter.   Please  see  "Legal
Proceedings"above.  Such operations may result in decreased net operating income
for such periods. The Partnership expects that the decrease, if any, will not be
material.  For the six months ended June 30, 1999, FPL requested the Partnership
to decommit the Facility numerous times and the Partnership  typically exercised
its rights to operate at minimum load (100MW) during such decommit requests. The
Partnership's  election to operate at minimum load has not had a material impact
on the Partnership or its financial  condition  although energy delivered during
such operations is sold at reduced  prices.  Based upon FPL's  projections,  the
Partnership  does not expect  that,  if the filed  projections  prove to reflect
actual rates, its dispatch rate will change materially during the period covered
by such projections.

Debt Service Reserve Account
----------------------------


        As permitted by the Partnership's financing arrangements,  on August 19,
1998, the  Partnership  requested  that the balance in the Debt Service  Reserve
Account be reduced  to the Debt  Service  Reserve  Account  Required  Balance by
reducing the Debt Service  Reserve  Letter of Credit.  On

                                       16
<PAGE>

January 11, 1999, the reduction was approved.  The Debt Service  Reserve Account
now  contains  the  $29,609,840  Debt  Service  Reserve  Letter  of  Credit  and
$12,500,000 of cash (available only as a debt service reserve for the Tax Exempt
Bonds).


Item 6  EXHIBITS AND REPORTS ON FORM 8-K

        a) Reports on Form 8-K:


               The Partnership  filed Reports on Form 8-K on March 22, March 29,
               and June 11, 1999  regarding  the FPL  litigation  and changes in
               ownership.


        b) Exhibits:


      Exhibit
        No.                                  Description
     --------                                -----------

      3.6           Dana Amendment to Amended and Restated  Limited  Partnership
                    Agreement of Indiantown Cogeneration, L.P.

      3.7           Cogentrix Amendment to Amended and Restated Limited
                    Partnership  Agreement of Indiantown Cogeneration, L.P.

      3.8           Third Amendment to Amended and Restated  Limited
                    Partnership  Agreement of Indiantown Cogeneration, L.P.







                                       17

<PAGE>


                                    SIGNATURE

        Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized


                                               INDIANTOWN COGENERATION, L.P.
                                               (Co-Registrant)


Date:  August 16, 1999                         ______________________________
                                               John R. Cooper
                                               Vice President and
                                               Chief Financial Officer


                                               INDIANTOWN COGENERATION FUNDING
                                               CORPORATION
                                               (Co-Registrant)


Date:  August 16, 1999                          ______________________________
                                                John R. Cooper
                                                Vice President and
                                                Chief Financial Officer






<PAGE>