UNITED STATES SECURITIES AND EXCHANGE
COMMISSION


Washington,
D.C. 20549





Form 10-Q





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





For
the quarterly period ended March 31, 2010





OR





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





Commission
File Number


001-33024





EV
Energy Partners, L.P.


(Exact
name of registrant as specified in its charter)





Delaware
              
              20–4745690(State
      or other jurisdiction
                of
      incorporation or organization)
              
              (I.R.S.
      Employer Identification No.)1001
      Fannin, Suite 800, Houston, Texas
              
              77002(Address
      of principal executive offices)
              
              (Zip
      Code)





Registrant’s
telephone number, including area code: (713) 651-1144





Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.


YES þ  NO  ̈





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).


YES  ̈  NO  ̈





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See definition of “large accelerated filer,” “accelerated
filer” and “smaller reporting company” in Rule 12b–2 of the Exchange
Act.  Check one:





Large
      accelerated filer  ̈
              
              Accelerated
      filer þ
              
              Non-accelerated
      filer  ̈
              
              Smaller
      reporting company  ̈





Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b–2 of the Exchange Act).


YES  ̈ NO þ





As of May
5, 2010, the registrant had 27,060,313 common units outstanding.













Table
of Contents





PART
      I.  FINANCIAL INFORMATIONItem
      1.  Condensed Consolidated Financial Statements
      (unaudited)
                
                2Item
      2.  Management’s Discussion and Analysis of Financial Condition
      and Results of Operations
                
                15Item
      3.  Quantitative and Qualitative Disclosures About Market
      Risk
                
                20Item
      4.  Controls and Procedures
                
                20PART
      II.  OTHER INFORMATIONItem
      1.  Legal Proceedings
                
                21Item
      1A.  Risk Factors
                
                21Item
      2.  Unregistered Sales of Equity Securities and Use of
      Proceeds
                
                21Item
      3.  Defaults Upon Senior Securities
                
                21Item
      4.  (Removed and Reserved)
                
                21Item
      5.  Other Information
                
                22Item
      6.  Exhibits
                
                22Signatures
                
                23





1





PART
1. FINANCIAL INFORMATION





ITEM
1. FINANCIAL STATEMENTS





EV
Energy Partners, L.P.


Condensed
Consolidated Balance Sheets


(In
thousands, except number of units)


(Unaudited)





March 31,
                      
                      
                      December 31,2010
                      
                      
                      2009ASSETSCurrent
      assets:Cash and cash
      equivalents
                      
                      $
                      19,163
                      
                      
                      $
                      18,806Accounts
    receivable:Oil, natural gas and natural
      gas liquids revenues
                      
                      
                      15,587
                      
                      
                      
                      14,599Related party
                      
                      
                      7,092
                      
                      
                      
                      2,881Other
                      
                      
                      7,494
                      
                      
                      
                      1,034Derivative asset
                      
                      
                      46,954
                      
                      
                      
                      26,733Other current
    assets
                      
                      
                      3,584
                      
                      
                      
                      625Total current
      assets
                      
                      
                      99,874
                      
                      
                      
                      64,678Oil
      and natural gas properties, net of accumulated depreciation, depletion
      andamortization; March 31, 2010, $133,874; December 31, 2009,
      $121,970
                      
                      
                      902,423
                      
                      
                      
                      771,752Other
      property, net of accumulated depreciation and amortization;March
      31, 2010, $346; December 31, 2009, $319
                      
                      
                      1,751
                      
                      
                      
                      742Long–term
      derivative asset
                      
                      
                      79,648
                      
                      
                      
                      68,549Other
      assets
                      
                      
                      1,847
                      
                      
                      
                      1,984Total
      assets
                      
                      $
                      1,085,543
                      
                      
                      $
                      907,705LIABILITIES
      AND OWNERS’ EQUITYCurrent
      liabilities:Accounts payable and accrued
      liabilities
                      
                      $
                      16,311
                      
                      
                      $
                      10,310Derivative
    liability
                      
                      
                      841
                      
                      
                      
                      1,543Total current
      liabilities
                      
                      
                      17,152
                      
                      
                      
                      11,853Asset
      retirement obligations
                      
                      
                      51,822
                      
                      
                      
                      42,533Long–term
      debt
                      
                      
                      345,000
                      
                      
                      
                      302,000Long–term
      liabilities
                      
                      
                      567
                      
                      
                      
                      3,212Long–term
      derivative liability
                      
                      
                      40
                      
                      
                      
                      676Commitments
      and contingenciesOwners’
      equity:Common
      unitholders – 27,060,313 units and 23,475,471 units issued andoutstanding
      as of March 31, 2010 and December 31, 2009, respectively
                      
                      
                      671,187
                      
                      
                      
                      548,160General partner
      interest
                      
                      
                      (225
                      )
                      
                      
                      (729
                      )Total owners’
      equity
                      
                      
                      670,962
                      
                      
                      
                      547,431Total
      liabilities and owners’ equity
                      
                      $
                      1,085,543
                      
                      
                      $
                      907,705





See
accompanying notes to unaudited condensed consolidated financial
statements.


2





EV
Energy Partners, L.P.


Condensed
Consolidated Statements of Operations


(In
thousands, except per unit data)


(Unaudited)





Three Months Ended
                    March 31,2010
                  
                  
                  2009Revenues:Oil, natural gas and natural gas
      liquids revenues
                  
                  $
                  38,596
                  
                  
                  $
                  26,007Transportation and
      marketing–related revenues
                  
                  
                  1,578
                  
                  
                  
                  3,218Total revenues
                  
                  
                  40,174
                  
                  
                  
                  29,225Operating
      costs and expenses:Lease operating
      expenses
                  
                  
                  11,432
                  
                  
                  
                  11,147Cost of purchased natural
      gas
                  
                  
                  1,220
                  
                  
                  
                  1,476Production taxes
                  
                  
                  2,127
                  
                  
                  
                  1,427Asset retirement obligations
      accretion expense
                  
                  
                  510
                  
                  
                  
                  444Depreciation, depletion and
      amortization
                  
                  
                  12,084
                  
                  
                  
                  13,632General and administrative
      expenses
                  
                  
                  4,724
                  
                  
                  
                  4,253Loss on sale of oil and natural
      gas properties
                  
                  
                  564
                  
                  
                  
                  –Total operating costs and
      expenses
                  
                  
                  32,661
                  
                  
                  
                  32,379Operating
      income (loss)
                  
                  
                  7,513
                  
                  
                  
                  (3,154
                  )Other
      income (expense), net:Realized gains on mark–to–market
      derivatives, net
                  
                  
                  7,965
                  
                  
                  
                  17,723Unrealized gains on
      mark–to–market derivatives, net
                  
                  
                  32,660
                  
                  
                  
                  26,668Interest expense
                  
                  
                  (2,103
                  )
                  
                  
                  (2,876
                  )Other income,
net
                  
                  
                  141
                  
                  
                  
                  8Total other income,
      net
                  
                  
                  38,663
                  
                  
                  
                  41,523Income
      before income taxes
                  
                  
                  46,176
                  
                  
                  
                  38,369Income
      taxes
                  
                  
                  (52
                  )
                  
                  
                  (25
                  )Net
      income
                  
                  $
                  46,124
                  
                  
                  $
                  38,344General
      partner’s interest in net income, including incentive distribution
      rights
                  
                  $
                  3,212
                  
                  
                  $
                  2,120Limited
      partners’ interest in net income
                  
                  $
                  42,912
                  
                  
                  $
                  36,224Net
      income per limited partner unit:Basic
                  
                  $
                  1.68
                  
                  
                  $
                  2.23Diluted
                  
                  $
                  1.68
                  
                  
                  $
                  2.23





See
accompanying notes to unaudited condensed consolidated financial
statements.


3





EV
Energy Partners, L.P.


Condensed
Consolidated Statements of Changes in Owners’ Equity


(In
thousands, except number of units)


(Unaudited)





Common
                    Unitholders
                  
                  
                  General
                    Partner
                    Interest
                  
                  
                  Total
                    Owners’
                    EquityBalance,
      December 31, 2009
                  
                  $
                  548,160
                  
                  
                  $
                  (729
                  )
                  
                  $
                  547,431Conversion
      of 134,842 vested phantom units and performance units
                  
                  
                  2,580
                  
                  
                  
                  –
                  
                  
                  
                  2,580Proceeds
      from public equity offering, net of underwriters discount
                  
                  
                  92,770
                  
                  
                  
                  –
                  
                  
                  
                  92,770Offering
      costs
                  
                  
                  (97
                  )
                  
                  
                  –
                  
                  
                  
                  (97
                  )Contribution
      from general partner
                  
                  
                  –
                  
                  
                  
                  1,977
                  
                  
                  
                  1,977Distributions
                  
                  
                  (17,826
                  )
                  
                  
                  (2,395
                  )
                  
                  
                  (20,221
                  )Equity–based
      compensation
                  
                  
                  398
                  
                  
                  
                  –
                  
                  
                  
                  398Net
      income
                  
                  
                  45,202
                  
                  
                  
                  922
                  
                  
                  
                  46,124Balance,
      March 31, 2010
                  
                  $
                  671,187
                  
                  
                  $
                  (225
                  )
                  
                  $
                  670,962





Common
                    Unitholders
                  
                  
                  Subordinated
                    Unitholders
                  
                  
                  General
                    Partner
                    Interest
                  
                  
                  Total
                    Owners’
                    EquityBalance,
      December 31, 2008
                  
                  $
                  432,031
                  
                  
                  $
                  21,618
                  
                  
                  $
                  3,835
                  
                  
                  $
                  457,484Conversion
      of 103,409 vested phantom units
                  
                  
                  1,706
                  
                  
                  
                  –
                  
                  
                  
                  –
                  
                  
                  
                  1,706Distributions
                  
                  
                  (9,861
                  )
                  
                  
                  (2,328
                  )
                  
                  
                  (1,625
                  )
                  
                  
                  (13,814
                  )Net
      income
                  
                  
                  30,407
                  
                  
                  
                  7,170
                  
                  
                  
                  767
                  
                  
                  
                  38,344Balance,
      March 31, 2009
                  
                  $
                  454,283
                  
                  
                  $
                  26,460
                  
                  
                  $
                  2,977
                  
                  
                  $
                  483,720





See
accompanying notes to unaudited condensed consolidated financial
statements.


4





EV
Energy Partners, L.P.


Condensed
Consolidated Statements of Cash Flows


(In
thousands)


(Unaudited)





Three Months Ended
                        March 31,2010
                      
                      
                      2009Cash
      flows from operating activities:Net income
                      
                      $
                      46,124
                      
                      
                      $
                      38,344Adjustments to reconcile net
      income to net cash flows provided byoperating activities:Asset retirement obligations
      accretion expense
                      
                      
                      510
                      
                      
                      
                      444Depreciation, depletion and
      amortization
                      
                      
                      12,084
                      
                      
                      
                      13,632Equity–based compensation
      cost
                      
                      
                      1,066
                      
                      
                      
                      619Loss on sale of oil and natural
      gas properties
                      
                      
                      564
                      
                      
                      
                      –Unrealized gain on derivatives,
      net
                      
                      
                      (32,660
                      )
                      
                      
                      (26,594
                      )Amortization of deferred loan
      costs
                      
                      
                      137
                      
                      
                      
                      151Other
                      
                      
                      (4
                      )
                      
                      
                      –Changes in operating assets and
      liabilities:Accounts
    receivable
                      
                      
                      (4,746
                      )
                      
                      
                      6,018Other current
      assets
                      
                      
                      209
                      
                      
                      
                      234Accounts payable and accrued
      liabilities
                      
                      
                      643
                      
                      
                      
                      (2,006
                      )Deferred
    revenues
                      
                      
                      –
                      
                      
                      
                      (3,208
                      )Long–term
      liabilities
                      
                      
                      (733
                      )
                      
                      
                      –Other, net
                      
                      
                      (39
                      )
                      
                      
                      18Net
      cash flows provided by operating activities
                      
                      
                      23,155
                      
                      
                      
                      27,652Cash
      flows from investing activities:Acquisition of oil and natural
      gas properties
                      
                      
                      (137,898
                      )
                      
                      
                      –Development of oil and natural
      gas properties
                      
                      
                      (2,411
                      )
                      
                      
                      (5,497
                      )Proceeds from sale of oil and
      natural gas properties
                      
                      
                      82
                      
                      
                      
                      –Net
      cash flows used in investing activities
                      
                      
                      (140,227
                      )
                      
                      
                      (5,497
                      )Cash
      flows from financing activities:Long–term debt
      borrowings
                      
                      
                      138,000
                      
                      
                      
                      –Repayment of long–term debt
      borrowings
                      
                      
                      (95,000
                      )
                      
                      
                      (17,000
                      )Proceeds from equity
      offering
                      
                      
                      92,770
                      
                      
                      
                      –Offering costs
                      
                      
                      (97
                      )
                      
                      
                      –Contribution from general
      partner
                      
                      
                      1,977
                      
                      
                      
                      –Distributions
    paid
                      
                      
                      (20,221
                      )
                      
                      
                      (13,814
                      )Net
      cash flows provided by (used in) financing activities
                      
                      
                      117,429
                      
                      
                      
                      (30,814
                      )Increase
      (decrease) in cash and cash equivalents
                      
                      
                      357
                      
                      
                      
                      (8,659
                      )Cash
      and cash equivalents – beginning of period
                      
                      
                      18,806
                      
                      
                      
                      41,628Cash
      and cash equivalents – end of period
                      
                      $
                      19,163
                      
                      
                      $
                      32,969





See
accompanying notes to unaudited condensed consolidated financial
statements.


5





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements





NOTE
1. ORGANIZATION AND NATURE OF BUSINESS





Nature
of Operations





EV Energy
Partners, L.P. (“we,” “our” or “us”) is a publicly held limited partnership that
engages in the acquisition, development and production of oil and natural gas
properties.  Our general partner is EV Energy GP, L.P. (“EV Energy
GP”), a Delaware limited partnership, and the general partner of our general
partner is EV Management, LLC (“EV Management”), a Delaware limited liability
company.  EV Management is a wholly owned subsidiary of EnerVest, Ltd.
(“EnerVest”), a Texas limited partnership.  EnerVest and its
affiliates also have a significant interest in us through their 71.25% ownership
of EV Energy GP which, in turn, owns a 2% general partner interest in us and all
of our incentive distribution rights.





Basis
of Presentation





Our
unaudited condensed consolidated financial statements included herein have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission.  Accordingly, certain information and disclosures normally
included in financial statements prepared in accordance with accounting
principles generally accepted in the United States of America have been
condensed or omitted.  We believe that the presentations and
disclosures herein are adequate to make the information not
misleading.  The unaudited condensed consolidated financial statements
reflect all adjustments (consisting of normal recurring adjustments) necessary
for a fair presentation of the interim periods.  The results of
operations for the interim periods are not necessarily indicative of the results
of operations to be expected for the full year.  These interim
financial statements should be read in conjunction with our Annual Report on
Form 10–K for the year ended December 31, 2009.





All
intercompany accounts and transactions have been eliminated in
consolidation.  In the Notes to Unaudited Condensed Consolidated
Financial Statements, all dollar and share amounts in tabulations are in
thousands of dollars and shares, respectively, unless otherwise
indicated.





NOTE 2. EQUITY–BASED
COMPENSATION





We grant
various forms of equity–based awards to employees, consultants and directors of
EV Management and its affiliates who perform services for us.  These
equity–based awards consist primarily of phantom units and performance
units.





We
account for the phantom units issued prior to 2009 as liability awards, and the
fair value of these phantom units is remeasured at the end of each reporting
period based on the current market price of our common units until
settlement.  Prior to settlement, compensation cost is recognized for
these phantom units based on the proportionate amount of the requisite service
period that has been rendered to date.  We account for the phantom
units issued in 2009 as equity awards, and we estimated the fair value of these
phantom units using the Black–Scholes option pricing model.  We
account for the performance units as equity awards, and we estimated the fair
value of these performance units using the Monte Carlo simulation
model.





The
following table presents the compensation costs recognized in our unaudited
condensed consolidated statements of operations:





Three Months Ended
                    March 31,2010
                  
                  
                  2009Liability
      awards
                  
                  $
                  668
                  
                  
                  $
                  619Equity
      awards
                  
                  
                  398
                  
                  
                  
                  –Total
                  
                  $
                  1,066
                  
                  
                  $
                  619





These
costs are included in “General and administrative expenses” in our condensed
consolidated statements of operations.


6





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





As of
March 31, 2010, total unrecognized compensation costs related to the unvested
liability awards and equity awards and the period over which they are expected
to be recognized are as follows:





Unrecognized
                  Compensation
                  Expense
                
                
                Weighted
                  Average
                  Period
                  (in years)Liability
      awards
                
                $
                4,638
                
                
                
                2.4Equity
      awards
                
                
                6,063
                
                
                
                3.2





NOTE
3. ACQUISITION AND PENDING DIVESTITURE





On March
30, 2010, we, along with certain institutional partnerships managed by EnerVest,
acquired additional oil and natural gas properties in the Appalachian
Basin.  We acquired a 46.15% interest in these properties for $137.9
million.  This acquisition was primarily funded with borrowings under
our credit facility.





The
recognized fair values of the identifiable assets acquired and liabilities
assumed in connection with this acquisition are as follows:





Accounts
      receivable
                  
                  $
                  6,913Other
      current assets
                  
                  
                  3,167Oil
      and natural gas properties
                  
                  
                  142,572Other
      property
                  
                  
                  1,036Accounts
      payable and accrued liabilities
                  
                  
                  (5,059
                  )Asset
      retirement obligations
                  
                  
                  (10,731
                  )$
                  137,898





The
amounts above represent preliminary estimates of the fair values of the
identifiable assets acquired and liabilities assumed for this
acquisition.  We expect to finalize these fair values in the second
quarter of 2010.





We
incurred transaction related costs of $0.1 million in the three months ended
March 31, 2010, and these costs are included in “General and administrative
expenses” in our condensed consolidated statements of operations.





The
following table reflects pro forma revenues, net income and net income per
limited partner unit as if this acquisition had taken place at the beginning of
the periods presented.  These unaudited pro forma amounts do not
purport to be indicative of the results that would have actually been obtained
during the periods presented or that may be obtained in the future.





Three Months Ended
                    March 31,2010
                  
                  
                  2009Revenues
                  
                  $
                  46,769
                  
                  
                  $
                  34,808Net
      income
                  
                  
                  48,258
                  
                  
                  
                  39,790Net
      income per limited partner unit:Basic
                  
                  $
                  1.76
                  
                  
                  $
                  2.32Diluted
                  
                  $
                  1.76
                  
                  
                  $
                  2.32





On March
31, 2010, we entered into an agreement to sell certain undeveloped acreage
for approximately $4.8 million.  The sale is subject to certain
conditions, including purchaser due diligence, and is expected to close by June
1, 2010.





NOTE
4. RISK MANAGEMENT





Our
business activities expose us to risks associated with changes in the market
price of oil and natural gas.  In addition, our floating rate credit
facility exposes us to risks associated with changes in interest
rates   As such, future earnings are subject to fluctuation due
to changes in the market price of oil and natural gas and interest
rates.  We use derivatives to reduce our risk of changes in the prices
of oil and natural gas and interest rates.  Our policies do not permit
the use of derivatives for speculative purposes.


7





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





We have
elected not to designate any of our derivatives as hedging
instruments.  Accordingly, changes in the fair value of our
derivatives are recorded immediately to net income as “Unrealized gains on
mark–to–market derivatives, net” in our condensed consolidated statements of
operations.





As of
March 31, 2010, we had entered into oil and natural gas commodity contracts with
the following terms:





Period Covered
                      
                      Index
                      
                      Hedged
                        Volume
                      
                      
                      Weighted
                        Average
                        Fixed
                        Price
                      
                      
                      Weighted
                        Average
                        Floor
                        Price
                      
                      
                      Weighted
                        Average
                        Ceiling
                        PriceOil
      (MBbls):Swaps – 2010
                      
                      WTI
                      
                      
                      642.1
                      
                      
                      
                      87.25Swaps – 2011
                      
                      WTI
                      
                      
                      219.0
                      
                      
                      
                      103.66Collar – 2011
                      
                      WTI
                      
                      
                      401.5
                      
                      
                      
                      
                      
                      
                      
                      110.00
                      
                      
                      
                      166.45Swaps – 2012
                      
                      WTI
                      
                      
                      205.0
                      
                      
                      
                      104.05Collar – 2012
                      
                      WTI
                      
                      
                      366.0
                      
                      
                      
                      
                      
                      
                      
                      110.00
                      
                      
                      
                      170.85Swaps – 2013
                      
                      WTI
                      
                      
                      511.0
                      
                      
                      
                      78.64Swap – January 2014 through July
      2014
                      
                      WTI
                      
                      
                      106.0
                      
                      
                      
                      84.60Swaps – January 2014 through
      August 2014
                      
                      WTI
                      
                      
                      194.4
                      
                      
                      
                      82.28Natural
      Gas (MmBtus):Swaps – 2010
                      
                      Dominion
      Appalachia
                      
                      
                      1,836.4
                      
                      
                      
                      8.19Swap – 2011
                      
                      Dominion
      Appalachia
                      
                      
                      912.5
                      
                      
                      
                      8.69Collar – 2011
                      
                      Dominion
      Appalachia
                      
                      
                      1,095.0
                      
                      
                      
                      
                      
                      
                      
                      9.00
                      
                      
                      
                      12.15Collar – 2012
                      
                      Dominion
      Appalachia
                      
                      
                      1,830.0
                      
                      
                      
                      
                      
                      
                      
                      8.95
                      
                      
                      
                      11.45Swap – 2010
                      
                      Appalachia
      Columbia
                      
                      
                      83.0
                      
                      
                      
                      5.75Swaps – 2010
                      
                      NYMEX
                      
                      
                      6,571.5
                      
                      
                      
                      7.36Collar – 2010
                      
                      NYMEX
                      
                      
                      412.5
                      
                      
                      
                      
                      
                      
                      
                      7.50
                      
                      
                      
                      10.00Swaps – 2011
                      
                      NYMEX
                      
                      
                      7,555.5
                      
                      
                      
                      7.63Collar – 2011
                      
                      NYMEX
                      
                      
                      440.6
                      
                      
                      
                      
                      
                      
                      
                      5.85
                      
                      
                      
                      7.55Swaps – 2012
                      
                      NYMEX
                      
                      
                      7,497.6
                      
                      
                      
                      7.95Swaps – 2013
                      
                      NYMEX
                      
                      
                      3,285.0
                      
                      
                      
                      7.23Swaps
      – January 2014 through August 2014
                      
                      NYMEX
                      
                      
                      1,215.0
                      
                      
                      
                      7.06Swap – 2010
                      
                      MICHCON_NB
                      
                      
                      1,375.0
                      
                      
                      
                      8.34Collar – 2011
                      
                      MICHCON_NB
                      
                      
                      1,642.5
                      
                      
                      
                      
                      
                      
                      
                      8.70
                      
                      
                      
                      11.85Collar – 2012
                      
                      MICHCON_NB
                      
                      
                      1,647.0
                      
                      
                      
                      
                      
                      
                      
                      8.75
                      
                      
                      
                      11.05Swaps – 2010
                      
                      HOUSTON
      SC
                      
                      
                      416.6
                      
                      
                      
                      5.78Collar – 2010
                      
                      HOUSTON
      SC
                      
                      
                      962.5
                      
                      
                      
                      
                      
                      
                      
                      7.25
                      
                      
                      
                      9.55Collar – 2011
                      
                      HOUSTON
      SC
                      
                      
                      1,277.5
                      
                      
                      
                      
                      
                      
                      
                      8.25
                      
                      
                      
                      11.65Collar – 2012
                      
                      HOUSTON
      SC
                      
                      
                      1,098.0
                      
                      
                      
                      
                      
                      
                      
                      8.25
                      
                      
                      
                      11.10Swap – 2010
                      
                      EL
      PASO PERMIAN
                      
                      
                      687.5
                      
                      
                      
                      7.68Swap – 2011
                      
                      EL
      PASO PERMIAN
                      
                      
                      912.5
                      
                      
                      
                      9.30Swap – 2012
                      
                      EL
      PASO PERMIAN
                      
                      
                      732.0
                      
                      
                      
                      9.21Swap – 2013
                      
                      EL
      PASO PERMIAN
                      
                      
                      1,095.0
                      
                      
                      
                      6.77Swap – 2013
                      
                      SAN
      JUAN BASIN
                      
                      
                      1,095.0
                      
                      
                      
                      6.66





As of
March 31, 2010, we had also entered into natural gas basis swaps with the
following terms:





Period Covered
                        
                        Floating Index 1
                        
                        Floating Index 2
                        
                        Hedged
                          Volume
                        
                        
                        Spread2010
                        
                        NYMEX
                        
                        Panhandle
      TX/OK
                        
                        
                        550.0
                        
                        
                        
                        (0.30
                        )2010
                        
                        NYMEX
                        
                        EL
      PASO PERMIAN
                        
                        
                        275.0
                        
                        
                        
                        (0.275
                        )2010
                        
                        NYMEX
                        
                        SAN
      JUAN BASIN
                        
                        
                        1,237.5
                        
                        
                        
                        (0.34
                        )2011
                        
                        NYMEX
                        
                        Dominion
      Appalachia
                        
                        
                        346.0
                        
                        
                        
                        0.19752011
                        
                        NYMEX
                        
                        Appalachia
      Columbia
                        
                        
                        94.5
                        
                        
                        
                        0.15




8





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





As of
March 31, 2010, we had also entered into interest rate swaps with the following
terms:





Period Covered
                
                Notional
                  Amount
                
                Floating
                  Rate
                
                Fixed
                  RateApril
      2010 – July 2012
                
                $
                200,000
                
                1
      Month LIBOR
                
                
                4.163
                %April
      2010 –  September 2012
                
                
                40,000
                
                1
      Month LIBOR
                
                
                2.145
                %





The fair
value of these derivatives was as follows:





Asset Derivatives
                
                
                Liability DerivativesMarch 31,
                  2010
                
                
                December 31,
                  2009
                
                
                March 31,
                  2010
                
                
                December 31,
                  2009Oil
      and natural gas commodity contracts
                
                $
                142,156
                
                
                $
                111,541
                
                
                $
                3,140
                
                
                $
                6,413Interest
      rate swaps
                
                
                –
                
                
                
                –
                
                
                
                13,295
                
                
                
                12,065Total
      fair value
                
                
                142,156
                
                
                
                111,541
                
                
                
                16,435
                
                
                
                18,478Netting
      arrangements
                
                
                (15,554
                )
                
                
                (16,259
                )
                
                
                (15,554
                )
                
                
                (16,259
                )Net
      recorded fair value
                
                $
                126,602
                
                
                $
                95,282
                
                
                $
                881
                
                
                $
                2,219Location
      of derivatives in ourcondensed consolidated balancesheets:Derivative
asset
                
                $
                46,954
                
                
                $
                26,733
                
                
                $
                –
                
                
                $
                –Long–term derivative
      asset
                
                
                79,648
                
                
                
                68,549
                
                
                
                –
                
                
                
                –Derivative
      liability
                
                
                –
                
                
                
                –
                
                
                
                841
                
                
                
                1,543Long–term derivative
      liability
                
                
                –
                
                
                
                –
                
                
                
                40
                
                
                
                676$
                126,602
                
                
                $
                95,282
                
                
                $
                881
                
                
                $
                2,219





The
following table presents the impact of derivatives and their location within the
unaudited condensed consolidated statements of operations:





Three Months Ended
                  March 31,2010
                
                
                2009Realized
      gains on mark–to–market derivatives, net:Oil and natural gas commodity
      contracts
                
                $
                10,123
                
                
                $
                19,572Interest rate
    swaps
                
                
                (2,158
                )
                
                
                (1,849
                )Total
                
                $
                7,965
                
                
                $
                17,723Unrealized
      gains on mark–to–market derivatives, net:Oil and natural gas commodity
      contracts
                
                $
                33,890
                
                
                $
                26,770Interest rate
    swaps
                
                
                (1,230
                )
                
                
                (102
                )Total
                
                $
                32,660
                
                
                $
                26,668




9





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





NOTE
5. FAIR VALUE MEASUREMENTS





The
following table presents the fair value hierarchy table for our assets and
liabilities that are required to be measured at fair value on a recurring
basis:





Fair Value at Reporting Date Using:March 31,
                  2010
                
                
                Quoted Prices
                  in Active
                  Markets for
                  Identical
                  Assets
                  (Level 1)
                
                
                Significant
                  Other
                  Observable
                  Inputs
                  (Level 2)
                
                
                Significant
                  Unobservable
                  Inputs
                  (Level 3)Derivative
      assets:Oil and natural gas commodity
      contracts
                
                $
                142,156
                
                
                $
                –
                
                
                $
                142,156
                
                
                $
                –Derivative
      liabilities:Oil and natural gas commodity
      contracts
                
                $
                3,140
                
                
                $
                –
                
                
                $
                3,140
                
                
                $
                –Interest rate
    swaps
                
                
                13,295
                
                
                
                –
                
                
                
                13,295
                
                
                
                –Total derivative
      liabilities
                
                $
                16,435
                
                
                $
                –
                
                
                $
                16,435
                
                
                $
                –





Fair Value at Reporting Date Using:December 31,
                  2009
                
                
                Quoted Prices
                  in Active
                  Markets for
                  Identical
                  Assets
                  (Level 1)
                
                
                Significant
                  Other
                  Observable
                  Inputs
                  (Level 2)
                
                
                Significant
                  Unobservable
                  Inputs
                  (Level 3)Derivative
      assets:Oil and natural gas commodity
      contracts
                
                $
                111,541
                
                
                $
                –
                
                
                $
                111,541
                
                
                $
                –Derivative
      liabilities:Oil and natural gas commodity
      contracts
                
                $
                6,413
                
                
                $
                –
                
                
                $
                6,413
                
                
                $
                –Interest rate
    swaps
                
                
                12,065
                
                
                
                –
                
                
                
                12,065
                
                
                
                –Total derivative
      liabilities
                
                $
                18,478
                
                
                $
                –
                
                
                $
                18,478
                
                
                $
                –





Our
derivatives consist of over–the–counter (“OTC”) contracts which are not traded
on a public exchange.   These derivatives are indexed to active
trading hubs for the underlying commodity, and are OTC contracts commonly used
in the energy industry and offered by a number of financial institutions and
large energy companies.





As the
fair value of these derivatives is based on inputs using market prices obtained
from independent brokers or determined using quantitative models that use as
their basis readily observable market parameters that are actively quoted and
can be validated through external sources, including third party pricing
services, brokers and market transactions, we have categorized these derivatives
as Level 2.  We value these derivatives based on observable market
data for similar instruments.  This observable data includes the
forward curve for commodity prices based on quoted market prices and prospective
volatility factors related to changes in the forward curves and yield curves
based on money market rates and interest rate swap data.  Our
estimates of fair value have been determined at discrete points in time based on
relevant market data.  These estimates involve uncertainty and cannot
be determined with precision.  There were no changes in valuation
techniques or related inputs in the three months ended March 31,
2010.


10





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





NOTE
6. ASSET RETIREMENT OBLIGATIONS





We record
an asset retirement obligation (“ARO”) and capitalize the asset retirement cost
in oil and natural gas properties in the period in which the retirement
obligation is incurred based upon the fair value of an obligation to perform
site reclamation, dismantle facilities or plug and abandon
wells.  After recording these amounts, the ARO is accreted to its
future estimated value using an assumed cost of funds and the additional
capitalized costs are depreciated on a unit–of–production basis.  The
changes in the aggregate ARO are as follows:





Balance
      as of December 31, 2009
                  
                  $
                  43,688Liabilities
      incurred or assumed in acquisitions
                  
                  
                  10,731Sale
      of oil and natural gas properties
                  
                  
                  (292
                  )Accretion
      expense
                  
                  
                  510Revisions
      in estimated cash flows
                  
                  
                  (1,616
                  )Payments
      to settle liabilities
                  
                  
                  (44
                  )Balance
      as of March 31, 2010
                  
                  $
                  52,977





As of
both March 31, 2010 and December 31, 2009, $1.2 million of our ARO is classified
as current and is included in “Accounts payable and accrued liabilities” in our
condensed consolidated balance sheet.





NOTE
7. LONG–TERM DEBT





As of
March 31, 2010, our credit facility consists of a $700.0 million senior secured
revolving credit facility that expires in October 2012.  Borrowings
under the facility are secured by a first priority lien on substantially all of
our assets and the assets of our subsidiaries.  We may use borrowings
under the facility for acquiring and developing oil and natural gas properties,
for working capital purposes, for general corporate purposes and for funding
distributions to partners.  We also may use up to $50.0 million of
available borrowing capacity for letters of credit.  The facility
requires the maintenance of a current ratio (as defined in the facility) of
greater than 1.0 and a ratio of total debt to earnings plus interest expense,
taxes, depreciation, depletion and amortization expense and exploration expense
of no greater than 4.0 to 1.0.  As of March 31, 2010, we were in
compliance with these financial covenants.





Borrowings
under the facility bear interest at a floating rate based on, at our election, a
base rate or the London Inter–Bank Offered Rate plus applicable premiums based
on the percent of the borrowing base that we have outstanding (weighted average
effective interest rate of 3.30% at March 31, 2010).





Borrowings
under the facility may not exceed a “borrowing base” determined by the lenders
under the facility based on our oil and natural gas reserves.  As of
March 31, 2010, the borrowing base under the facility was $465.0
million.  The borrowing base is subject to scheduled redeterminations
as of April 1 and October 1 of each year with an additional redetermination once
per calendar year at our request or at the request of the lenders and with one
calculation that may be made at our request during each calendar year in
connection with material acquisitions or divestitures of
properties.





We had
$345.0 million and $302.0 million outstanding under the facility at March 31,
2010 and December 31, 2009, respectively.





NOTE
8. COMMITMENTS AND CONTINGENCIES





We are
involved in disputes or legal actions arising in the ordinary course of
business.  We do not believe the outcome of such disputes or legal
actions will have a material adverse effect on our condensed consolidated
financial statements, and no amounts have been accrued at March 31, 2010 or
December 31, 2009.





NOTE
9. OWNERS’ EQUITY





Units
Outstanding





At March
31, 2010, owner’s equity consists of 27,060,313 common units, representing a 98%
limited partnership interest in us, and a 2% general partnership
interest.


11





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





Issuance
of Units





In
January 2010, 108,971 phantom units vested at a fair value of $3.3
million.  Of these vested units, 84,842 were converted to common units
at a fair value of $2.6 million and 24,129 were settled in cash at a fair value
of $0.7 million.  In addition, 50,000 performance units vested and
were converted to common units.





On
February 12, 2010, we closed a public offering of 3.45 million of our common
units at an offering price of $28.08 per common unit.  We received net
proceeds of $94.7 million, including a contribution of $2.0 million by our
general partner to maintain its 2% interest in us.  We used these net
proceeds to repay indebtedness outstanding under our credit
facility.





Cash
Distributions





On
January 26, 2010, the board of directors of EV Management declared a $0.755 per
unit distribution for the fourth quarter of 2009 on all common
units.  The distribution was paid on February 12, 2010 to
unitholders of record at the close of business on February 5,
2010.  The aggregate amount of the distribution was $20.2
million.





On
April 27, 2010, the board of directors of EV Management declared a $0.756 per
unit distribution for the first quarter of 2010 on all common
units.  The distribution of $23.2 million is to be paid on May 14,
2010 to unitholders of record at the close of business on May 7,
2010.





NOTE
10. NET INCOME PER LIMITED PARTNER UNIT





The
following sets forth the calculation of net income per limited partner
unit:





Three Months Ended
                  March 31,2010
                
                
                2009Net
      income
                
                $
                46,124
                
                
                $
                38,344Less:Incentive distribution
      rights
                
                
                (2,290
                )
                
                
                (1,353
                )General partner’s 2% interest in
      net income
                
                
                (922
                )
                
                
                (767
                )Net
      income available for limited partners
                
                $
                42,912
                
                
                $
                36,224Weighted
      average limited partner units outstanding:Common units
                
                
                25,429
                
                
                
                13,114Subordinated
    units
                
                
                –
                
                
                
                3,100Performance units (1)
                
                
                158
                
                
                
                –Denominator for basic net income
      per limited partner unit
                
                
                25,587
                
                
                
                16,214Dilutive units – phantom
      units
                
                
                28
                
                
                
                –Denominator for diluted net
      income per limited partner unit
                
                
                25,615
                
                
                
                16,214Net
      income per limited partner unit:Basic
                
                $
                1.68
                
                
                $
                2.23Diluted
                
                $
                1.68
                
                
                $
                2.23





(1)
            Our
      earned but unvested performance units are considered to be participating
      securities for purposes of calculating our net income per limited partner
      unit,and,
      accordingly, are now included in the basic computation as
      such.





NOTE
11. RELATED PARTY TRANSACTIONS





Pursuant
to an omnibus agreement, we paid EnerVest $2.0 million and $1.9 million in the
three months ended March 31, 2010 and 2009, respectively, in monthly
administrative fees for providing us general and administrative
services.  These fees are based on an allocation of charges between
EnerVest and us based on the estimated use of such services by each party, and
we believe that the allocation method employed by EnerVest is reasonable and
reflective of the estimated level of costs we would have incurred on a
standalone basis.  These fees are included in general and
administrative expenses in our condensed consolidated statements of
operations.


12





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





We have
entered into operating agreements with EnerVest whereby a subsidiary of EnerVest
acts as contract operator of the oil and natural gas wells and related gathering
systems and production facilities in which we own an interest.  During
the three months ended March 31, 2010 and 2009, we reimbursed EnerVest
approximately $2.4 million and $2.6 million, respectively, for direct expenses
incurred in the operation of our wells and related gathering systems and
production facilities and for the allocable share of the costs of EnerVest
employees who performed services on our properties.  As the vast
majority of such expenses are charged to us on an actual basis (i.e., no mark–up
or subsidy is charged or received by EnerVest), we believe that the
aforementioned services were provided to us at fair and reasonable rates
relative to the prevailing market and are representative of what the amounts
would have been on a standalone basis.  These costs are included in
lease operating expenses in our condensed consolidated statements of
operations.  Additionally, in its role as contract operator,
this EnerVest subsidiary also collects proceeds from oil and natural
gas sales and distributes them to us and other working interest owners.





NOTE 12. OTHER SUPPLEMENTAL
INFORMATION





Supplemental
cash flows and non–cash transactions were as follows:





Three Months Ended
                  March 31,2010
                
                
                2009Supplemental
      cash flows information:Cash paid for
      interest
                
                $
                1,849
                
                
                $
                3,135Non–cash
      transactions:Costs
      for development of oil and natural gas properties inaccounts payable and
      accrued liabilities
                
                
                1,665
                
                
                
                1,350





NOTE 13. NEW ACCOUNTING
STANDARDS





In
January 2010, the Financial Accounting Standards Board (“FASB”) issued
Accounting Standards Update (“ASU”) No. 2010–06, Fair Value Measurements and
Disclosures (Topic 820), which provides amendments to Topic 820 and
requires new disclosures for (i) transfers between Levels 1, 2 and 3 and the
reasons for such transfers and (ii) activity in Level 3 fair value measurements
to show separate information about purchases, sales, issuances and
settlements.  In addition, ASU 2010–06 amends Topic 820 to clarify
existing disclosures around the disaggregation level of fair value measurements
and disclosures for the valuation techniques and inputs utilized (for Level 2
and Level 3 fair value measurements). The provisions in ASU 2010–06 are
applicable to interim and annual reporting periods beginning subsequent to
December 15, 2009, with the exception of Level 3 disclosures of purchases,
sales, issuances and settlements, which will be required in reporting periods
beginning after December 15, 2010.  The adoption of ASU 2010–06 did
not impact our operating results, financial position or cash flows, but did
impact our disclosures on fair value measurements (see Note 5).





In April
2010, the FASB issued ASU No. 2010–14, Accounting for Extractive Activities
– Oil & Gas: Amendments to Paragraph 932–10–S99–1, to amend paragraph
932–10–S99–1 due to SEC Release No. 33-8995 [FR 78], Modernization of Oil and Gas
Reporting.





No other
new accounting pronouncements issued or effective during the three months ended
March 31, 2010 have had or are expected to have a material impact on our
condensed consolidated financial statements.





NOTE 14. SUBSEQUENT
EVENTS





On April
26, 2010, we entered into an amendment to our credit facility that provides that
(i) during the period between April 26, 2010 and the first scheduled
redetermination date thereafter (expected to occur on or around October 1,
2010), if we issue senior debt in excess of $200.0 million other than in
conjunction with an interim redetermination, the borrowing base then in effect
on the date on which such senior debt is issued would be reduced by an amount
equal to the product of 0.30 multiplied by the stated principal amount of such
senior debt in excess of $200.0 million and (ii) from the date after the first
scheduled redetermination date, if we issue any senior debt, the borrowing base
then in effect on the date on which such senior debt is issued would be reduced
by an amount equal to the product of 0.30 multiplied by the stated principal
amount of such senior debt.  This amendment also included a
reaffirmation of our borrowing base at $465.0 million.


13





EV
Energy Partners, L.P.


Notes
to Unaudited Condensed Consolidated Financial Statements
(continued)





On April
29, 2010, we, along with certain institutional partnerships managed by EnerVest,
acquired additional oil and natural gas properties in the Appalachian
Basin.  We acquired a 17.2% interest in these properties for $2.0
million.  The acquisition was primarily funded with cash on
hand.





We
evaluated subsequent events for appropriate accounting and disclosure through
the date these condensed consolidated financial statements were
issued


14


ITEM 2. MANAGEMENT’S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS





Management’s
Discussion and Analysis of Financial Condition and Results of Operations should
be read in conjunction with our condensed consolidated financial statements and
the related notes thereto, as well as our Annual Report on Form 10–K for the
year ended December 31, 2009.





OVERVIEW





We are a
Delaware limited partnership formed in April 2006 by EnerVest to acquire,
produce and develop oil and natural gas properties.  Our general
partner is EV Energy GP, a Delaware limited partnership, and the general partner
of our general partner is EV Management, a Delaware limited liability
company.





Our
properties are located in the Appalachian Basin (primarily in Ohio and West
Virginia), Michigan, the Monroe Field in Northern Louisiana, Central and East
Texas (which includes the Austin Chalk area), the Permian Basin, the San Juan
Basin and the Mid–Continent areas in Oklahoma, Texas, Kansas and
Louisiana.  As of December 31, 2009, we had estimated net proved
reserves of 7.4 MMBbls of oil, 257.2 Bcf of natural gas and 10.7 MMBbls of
natural gas liquids, or 365.6 Bcfe, and a standardized measure of
$351.5 million.





CURRENT
DEVELOPMENTS





In
February 2010, we closed a public offering of 3.45 million common units at an
offering price of $28.08 per common unit.  We received net proceeds of
$94.7 million, including a contribution of $2.0 million by our general partner
to maintain its 2% interest in us.





In
February 2010, we repaid $95.0 million of indebtedness outstanding under our
credit facility with proceeds from our public offering and cash flows from
operations.





In March
2010, we, along with certain institutional partnerships managed by EnerVest,
acquired additional oil and natural gas properties in the Appalachian
Basin.  We acquired a 46.15% interest in these properties for $137.9
million.  The acquisition was primarily funded with borrowings under
our credit facility.





BUSINESS
ENVIRONMENT





Our
primary business objective is to provide stability and growth in cash
distributions per unit over time.  The amount of cash we can
distribute on our units principally depends upon the amount of cash generated
from our operations, which will fluctuate from quarter to quarter based on,
among other things:





·
            the
      prices at which we will sell our oil, natural gas liquids and natural gas
      production;





·
            our
      ability to hedge commodity prices;





·
            the
      amount of oil, natural gas liquids and natural gas we produce;
      and





·
            the
      level of our operating and administrative
costs.





Oil and
natural gas prices are expected to be volatile in the future.  Factors
affecting the price of oil include worldwide economic conditions, geopolitical
activities, worldwide supply disruptions, weather conditions, actions taken by
the Organization of Petroleum Exporting Countries and the value of the U.S.
dollar in international currency markets.  Factors affecting the price
of natural gas include the discovery of substantial accumulations of natural gas
in unconventional reservoirs due to technological advancements necessary to
commercially produce these unconventional reserves, North American weather
conditions, industrial and consumer demand for natural gas, storage levels of
natural gas and the availability and accessibility of natural gas deposits in
North America.





In order
to mitigate the impact of changes in oil and natural gas prices on our cash
flows, we are a party to derivatives, and we intend to enter into derivatives in
the future to reduce the impact of oil and natural gas price volatility on our
cash flows.  By removing a significant portion of this price
volatility on our future oil and natural gas production through August 2014, we
have mitigated, but not eliminated, the potential effects of changing oil and
natural gas prices on our cash flows from operations for those
periods.  If commodity prices are depressed for an extended period of
time, it could alter our acquisition and development plans, and adversely affect
our growth strategy and ability to access additional capital in the capital
markets.


15





The
primary factors affecting our production levels are capital availability, our
ability to make accretive acquisitions, the success of our drilling program and
our inventory of drilling prospects.  In addition, we face the
challenge of natural production declines.  As initial reservoir
pressures are depleted, production from a given well decreases.  We
attempt to overcome this natural decline through a combination of drilling and
acquisitions.  Our future growth will depend on our ability to
continue to add reserves through drilling and acquisitions in excess of
production.  We will maintain our focus on the costs to add reserves
through drilling and acquisitions as well as the costs necessary to produce such
reserves.  Our ability to add reserves through drilling is dependent
on our capital resources and can be limited by many factors, including our
ability to timely obtain drilling permits and regulatory
approvals.  Any delays in drilling, completion or connection to
gathering lines of our new wells will negatively impact our production, which
may have an adverse effect on our revenues and, as a result, cash available for
distribution.





We focus
our efforts on increasing oil and natural gas reserves and production while
controlling costs at a level that is appropriate for long–term
operations.  Our future cash flows from operations are dependent upon
our ability to manage our overall cost structure.





RESULTS
OF OPERATIONS





Three Months Ended
                  March 31,2010
                
                
                2009Production
      data:Oil (MBbls)
                
                
                126
                
                
                
                127Natural gas liquids
      (MBbls)
                
                
                182
                
                
                
                214Natural gas
    (MMcf)
                
                
                3,985
                
                
                
                3,962Net production
      (MMcfe)
                
                
                5,833
                
                
                
                6,010Average
      sales price per unit:Oil (Bbl)
                
                $
                74.46
                
                
                $
                34.15Natural gas liquids
      (Bbl)
                
                
                45.54
                
                
                
                23.95Natural gas
(Mcf)
                
                
                5.25
                
                
                
                4.17Mcfe
                
                
                6.62
                
                
                
                4.33Average
      unit cost per Mcfe:Production
costs:Lease operating
      expenses
                
                $
                1.96
                
                
                $
                1.85Production
taxes
                
                
                0.36
                
                
                
                0.24Total
                
                
                2.32
                
                
                
                2.09Asset retirement obligations
      accretion expense
                
                
                0.09
                
                
                
                0.07Depreciation, depletion and
      amortization
                
                
                2.07
                
                
                
                2.27General and administrative
      expenses
                
                
                0.81
                
                
                
                0.71





Net
income for the three months ended March 31, 2010 was $46.1 million, an increase
of $7.7 million compared with the three months ended March 31,
2009.  This increase was primarily the result of $10.9 million of
higher revenues due to increased prices for oil, natural gas and natural gas
liquids and $6.0 million of increased non–cash changes in the value of our
derivatives partially offset by $9.8 million of decreased realized gains on our
derivatives.





Oil,
natural gas and natural gas liquids revenues for the three months ended March
31, 2010 totaled $38.6 million, an increase of $12.6 million compared with the
three months ended March 31, 2009.  This increase was primarily the
result of $13.9 million related to higher prices for oil, natural gas and
natural gas liquids  partially offset by lower
production.  The decrease in production was primarily attributable to
35 MBbls of natural gas liquids that were produced into storage at Mt. Belvieu,
TX during the three months ended December 31, 2008 and fractionated and sold in
the three months ended March 31, 2009.





Transportation
and marketing–related revenues for the three months ended March 31, 2010
decreased $1.6 million compared with the three months ended March 31, 2009
primarily due to the recognition of deferred revenues of $1.3 million in the
three months ended March 31, 2009 from the production curtailments in the Monroe
Field in 2008 and lower volumes of natural gas transported through our
gathering systems in the Monroe Field.


16





Lease
operating expenses for the three months ended March 31, 2010 increased $0.3
million compared with the three months ended March 31, 2009 primarily as the
result of $1.0 million related to the oil and natural gas properties that we
acquired in 2009 offset by a decrease of $0.7 million related to the oil and
natural gas properties that we acquired prior to 2009.  Lease
operating expenses for the three months ended March 31, 2010 were $1.96 per Mcfe
compared with $1.85 in the three months ended March 31, 2009.





The cost
of purchased natural gas for the three months ended March 31, 2010
decreased $0.5 million compared with the three months ended March 31, 2009
primarily due to lower volumes of natural gas that we purchased and transported
through our gathering systems in the Monroe Field.





Production
taxes for the three months ended March 31, 2010 increased $0.7 million compared
with the three months ended March 31, 2009 primarily as the result of an
increase of $0.6 million in production taxes associated with our increased oil,
natural gas and natural gas liquids revenues and an increase of $0.1 million in
production taxes associated with the oil and natural gas properties that we
acquired in 2009.  Production taxes for the three months ended March
31, 2010 were $0.36 per Mcfe compared with $0.24 per Mcfe for the three months
ended March 31, 2009.





Asset
retirement obligations accretion expense for the three months ended March 31,
2010 increased $0.1 million compared with the three months ended March 31, 2009
primarily due to the oil and natural gas properties that we acquired in
2009.  Asset retirement obligations accretion expense for the three
months ended March 31, 2010 was $0.09 per Mcfe compared with $0.07 per Mcfe for
the three months ended March 31, 2009.





Depreciation,
depletion and amortization for the three months ended March 31, 2010 decreased
$1.5 million compared with the three months ended March 31, 2009 primarily due
to a decrease of $2.6 million related to the oil and natural gas properties that
we acquired prior to 2009 offset by $1.1 million related to the oil and natural
gas properties that we acquired in 2009.  The decrease in
depreciation, depletion and amortization for the oil and natural gas properties
that we acquired prior to 2009 reflects to a lower depreciation, depletion and
amortization rate for the three months ended March 31, 2010 compared with the
three months ended March 31, 2009 due to increased reserves primarily due to
higher oil and natural gas liquids prices at December 31, 2009 compared with
December 31, 2008.  Depreciation, depletion and amortization for the
three months ended March 31, 2010 was $2.07 per Mcfe compared with $2.27
per Mcfe for the three months ended March 31, 2009.





General
and administrative expenses include the costs of administrative employees and
related benefits, management fees paid to EnerVest, professional fees and other
costs not directly associated with field operations.  General and
administrative expenses for the three months ended March 31, 2010 totaled $4.7
million, an increase of $0.4 million compared with the three months ended March
31, 2009.  This increase is primarily attributable to higher
compensation costs related to our phantom units and performance
units.  General and administrative expenses were $0.81 per Mcfe in the
three months ended March 31, 2010 compared with $0.71 per Mcfe in the three
months ended March 31, 2009.





Realized
gains on mark–to–market derivatives, net represent the monthly cash settlements
with our counterparties related to derivatives that matured during the
period.  During the three months ended March 31, 2010 and 2009, we
received cash payments of $8.0 million and $17.7 million, respectively, from our
counterparties as the contract prices for our derivatives exceeded the
underlying market prices for that period.





Unrealized
gains on mark–to–market derivatives, net represent the change in the fair value
of our open derivatives during the period.  In the three months ended
March 31, 2010, the fair value of our open derivatives increased from a net
asset of $93.1 million at December 31, 2009 to a net asset of $125.8
million at March 31, 2010.  In the three months ended March 31, 2009,
the fair value of our open derivatives increased from a net asset of $144.7
million at December 31, 2008 to a net asset of $171.4 million at March 31,
2009.





Interest
expense for the three months ended March 31, 2010 decreased $0.8 million
compared with the three months ended March 31, 2009 primarily due to a decrease
of $1.6 million from the lower weighted average borrowings outstanding
under our credit facility offset by an increase of $0.8 million due to a higher
weighted average effective interest rate in the three months ended March 31,
2010 compared with the three months ended March 31, 2009.


17





LIQUIDITY AND CAPITAL
RESOURCES





Historically,
our primary sources of liquidity and capital have been issuances of equity
securities, borrowings under our credit facility and cash flows from operations,
and our primary uses of cash have been acquisitions of oil and natural gas
properties and related assets, development of our oil and natural gas
properties, distributions to our partners and working capital
needs.  For 2010, we believe that cash on hand and net cash flows
generated from operations will be adequate to fund our capital budget and
satisfy our short–term liquidity needs.  We may also utilize various
financing sources available to us, including the issuance of equity or debt
securities through public offerings or private placements, to fund our
acquisitions and long–term liquidity needs.  Our ability to complete
future offerings of equity or debt securities and the timing of these offerings
will depend upon various factors including prevailing market conditions and our
financial condition.





In the
past we accessed the equity markets to finance our significant
acquisitions.  While we have been successful in accessing the public
equity markets in 2010, any disruptions in the financial markets may limit our
ability to access the public equity or debt markets in the future.





Available
Credit Facility





We have a
$700.0 million facility that expires in October 2012.  Borrowings
under the facility are secured by a first priority lien on substantially all of
our assets and the assets of our subsidiaries.  We may use borrowings
under the facility for acquiring and developing oil and natural gas properties,
for working capital purposes, for general corporate purposes and for funding
distributions to partners.  We also may use up to $50.0 million of
available borrowing capacity for letters of credit.  The facility
requires the maintenance of a current ratio (as defined in the facility) of
greater than 1.0 and a ratio of total debt to earnings plus interest expense,
taxes, depreciation, depletion and amortization expense and exploration expense
of no greater than 4.0 to 1.0.  As of March 31, 2010, we were in
compliance with these financial covenants.





Borrowings
under the facility may not exceed a “borrowing base” determined by the lenders
based on our oil and natural gas reserves.  As of March 31, 2010, the
borrowing base was $465.0 million.  The borrowing base is subject to
scheduled redeterminations as of April 1 and October 1 of each year with an
additional redetermination once per calendar year at our request or at the
request of the lenders and with one calculation that may be made at our request
during each calendar year in connection with material acquisitions or
divestitures of properties.  The borrowing base is determined by each
lender based on the value of our proved oil and natural gas reserves using
assumptions regarding future prices, costs and other matters that may vary by
lender.





Borrowings
under the facility will bear interest at a floating rate based on, at our
election, a base rate or the London Inter–Bank Offered Rate plus applicable
premiums based on the percent of the borrowing base that we have
outstanding.





At March
31, 2010, we had $345.0 million outstanding under the facility.





On April
26, 2010, we entered into an amendment to our credit facility that provides that
(i) during the period between April 26, 2010 and the first scheduled
redetermination date thereafter (expected to occur on or around October 1,
2010), if we issue senior debt in excess of $200.0 million other than in
conjunction with an interim redetermination, the borrowing base then in effect
on the date on which such senior debt is issued would be reduced by an amount
equal to the product of 0.30 multiplied by the stated principal amount of such
senior debt in excess of $200.0 million and (ii) from the date after the first
scheduled redetermination date, if we issue any senior debt, the borrowing base
then in effect on the date on which such senior debt is issued would be reduced
by an amount equal to the product of 0.30 multiplied by the stated principal
amount of such senior debt.  This amendment also included a
reaffirmation of our borrowing base at $465.0 million.





Cash
and Short–term Investments





At March
31, 2010, we had $19.2 million of cash and short–term investments, which
included $15.5 million of short–term investments.  With regard to our
short–term investments, we invest in money market accounts with a major
financial institution.




Counterparty
Exposure





At March
31, 2010, our open commodity derivative contracts were in a net receivable
position with a fair value of $125.7 million.  All of our commodity
derivative contracts are with major financial institutions who are also lenders
under our credit facility.  Should one of these financial
counterparties not perform, we may not realize the benefit of some of our
derivative instruments under lower commodity prices and we could incur a
loss.  As of March 31, 2010, all of our counterparties have performed
pursuant to their commodity derivative contracts.


18





Cash
Flows





Cash
flows provided by (used in) type of activity were as follows:





Three Months Ended
                  March 31,2010
                
                
                2009Operating
      activities
                
                $
                23,155
                
                
                $
                27,652Investing
      activities
                
                
                (140,227
                )
                
                
                (5,497
                )Financing
      activities
                
                
                117,429
                
                
                
                (30,814
                )





Operating
Activities





Cash
flows from operating activities provided $23.2 million and $27.7 million in the
three months ended March 31, 2010 and 2009, respectively.  The
decrease was primarily due to changes in operating assets and liabilities
related to higher prices for oil, natural gas and natural gas liquids and the
timing of cash receipts and payments in the three months ended March 31, 2010
compared with the three months ended March 31, 2009.





Investing
Activities





Our
principal recurring investing activity is the acquisition and development of oil
and natural gas properties.  During the three months ended March 31,
2010, we spent $137.9 million for an acquisition of oil and natural gas
properties and $2.4 million for development of our oil and natural gas
properties.  During the three months ended March 31, 2009, we spent
$5.5 million for development of our oil and natural gas properties.





Financing
Activities





During
the three months ended March 31, 2010, we received net proceeds of $92.7 million
from our public equity offering in February 2010, and we received contributions
of $2.0 million from our general partner in order to maintain its 2% interest in
us.  We borrowed $138.0 million under our credit facility to finance
our acquisition of oil and natural gas properties in March 2010 and we repaid
$95.0 million of borrowings outstanding under our credit facility with proceeds
from our public equity offering and cash flows from operations.  In
addition, we paid distributions of $20.2 million to holders of our common units
and our general partner.





During
the three months ended March 31, 2009, we repaid $17.0 million of borrowings
under our credit facility, and we paid distributions of $13.8 million to holders
of our common and subordinated units and our general partner.





FORWARD–LOOKING
STATEMENTS





This Form
10–Q contains forward–looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, (each a “forward–looking
statement”).  The words “anticipate,” “believe,” “ensure,” “expect,”
“if,” “intend,” “estimate,” “project,” “forecasts,” “predict,” “outlook,” “aim,”
“will,” “could,” “should,” “would,” “may,” “likely” and similar expressions, and
the negative thereof, are intended to identify forward–looking
statements.  These statements discuss future expectations, contain
projections of results of operations or of financial condition or state other
“forward–looking” information.





All of
our forward–looking information is subject to risks and uncertainties that could
cause actual results to differ materially from the results
expected.  Although it is not possible to identify all factors, these
risks and uncertainties include the risk factors and the timing of any of those
risk factors identified in the “Risk Factors” section included in our Annual
Report on Form 10–K for the year ended December 31, 2009.  This
document is available through our web site or through the SEC’s Electronic Data
Gathering and Analysis Retrieval System at http://www.sec.gov.


19





ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK





We are
exposed to certain market risks that are inherent in our financial statements
that arise in the normal course of business.  We may enter into
derivative instruments to manage or reduce market risk, but do not enter into
derivative agreements for speculative purposes.





We do not
designate these or future derivative instruments as hedges for accounting
purposes.  Accordingly, the changes in the fair value of these
instruments are recognized currently in earnings.





Commodity
Price Risk





Our major
market risk exposure is to prices for oil, natural gas and natural gas
liquids.  These prices have historically been volatile.  As
such, future earnings are subject to change due to changes in these
prices.  Realized prices are primarily driven by the prevailing
worldwide price for oil and regional spot prices for natural gas
production.  We have used, and expect to continue to use, oil and
natural gas commodity contracts to reduce our risk of changes in the prices of
oil and natural gas.  Pursuant to our risk management policy, we
engage in these activities as a hedging mechanism against price volatility
associated with pre–existing or anticipated sales of oil and natural
gas.





We have
entered into oil and natural gas commodity contracts to hedge significant
amounts of our anticipated oil and natural gas production through August
2014.  The amounts hedged represent, on an Mcfe basis, approximately
56% of the production attributable to our estimated net proved reserves from
April 2010 through August 2014, as estimated in our reserve report prepared by
third party engineers using prices, costs and other assumptions required by SEC
rules.  Our actual production will vary from the amounts estimated in
our reserve reports, perhaps materially.





The fair
value of our oil and natural gas commodity contracts and basis swaps at March
31, 2010 was a net asset of $139.0 million.  A 10% change in oil and
natural gas prices with all other factors held constant would result in a change
in the fair value (generally correlated to our estimated future net cash flows
from such instruments) of our oil and natural gas commodity contracts and basis
swaps of approximately $28.4 million.  Please see “Item 1. Condensed
Consolidated Financial Statements” contained herein for additional
information.





Interest
Rate Risk





Our
floating rate credit facility also exposes us to risks associated with changes
in interest rates and as such, future earnings are subject to change due to
changes in these interest rates.  The fair value of our interest rate
swaps at March 31, 2010 was a net liability of $13.3 million.  If
interest rates on our facility increased by 1%, interest expense for the three
months ended March 31, 2010 would have increased by approximately $0.6
million.  Please see “Item 1. Condensed Consolidated Financial
Statements” contained herein for additional information.





ITEM 4. CONTROLS AND
PROCEDURES





Evaluation of
Disclosure Controls and Procedures





In
accordance with Exchange Act Rule 13a–15 and 15d–15, we carried out an
evaluation, under the supervision and with the participation of management,
including our Chief Executive Officer and our Chief Financial Officer, of the
effectiveness of our disclosure controls and procedures as of the end of the
period covered by this report.  Based on that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that our disclosure
controls and procedures were effective as of March 31, 2010 to provide
reasonable assurance that information required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission’s rules and forms.  Our disclosure controls and procedures
include controls and procedures designed to ensure that information required to
be disclosed in reports filed or submitted under the Exchange Act is accumulated
and communicated to our management, including our Chief Executive Officer and
Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosure.





Change
in Internal Controls Over Financial Reporting





There
have not been any changes in our internal controls over financial reporting that
occurred during the quarterly period ended March 31, 2010 that have materially
affected, or are reasonably likely to materially affect, our internal controls
over financial reporting.


20


PART II. OTHER
INFORMATION





ITEM 1. LEGAL
PROCEEDINGS





We are
involved in disputes or legal actions arising in the ordinary course of
business.  We do not believe the outcome of such disputes or legal
actions will have a material adverse effect on our condensed consolidated
financial statements.





ITEM 1A. RISK
FACTORS





The
following risk factor in our Form 10–K for the year ending December 31, 2009, is
revised as follows to include a description of action taken by the Environmental
Protection Agency (the “EPA”) on March 23, 2010.





Climate
change legislation or regulations restricting emissions of greenhouse gases
(“GHGs”) could result in increased operating costs and reduced demand for the
oil and natural gas we produce.





On
December 15, 2009, the EPA officially published its findings that emissions of
carbon dioxide, methane and other GHGs present an endangerment to public health
and the environment because emissions of such gases are, according to the EPA,
contributing to warming of the earth’s atmosphere and other climatic
changes.  These findings allow the EPA to adopt and implement
regulations that would restrict emissions of GHGs under existing provisions of
the federal Clean Air Act.  Accordingly, the EPA has proposed two sets
of regulations that would require a reduction in emissions of GHGs from motor
vehicles and could trigger permit review for GHG emissions from certain
stationary sources.  In addition, on October 30, 2009, the EPA
published a final rule requiring the reporting of GHG emissions from specified
large GHG emission sources in the United States beginning in 2011 for emissions
occurring in 2010.  On March 23, 2010, the EPA announced that it will
be proposing a rule to extend this reporting obligation to oil and natural gas
facilities, including onshore and offshore oil and natural gas production
facilities, which may include facilities we operate.





On June
26, 2009, the House of Representatives passed the American Clean Energy and
Security Act of 2009 (the “ACESA”) which would establish an economy wide cap and
trade program to reduce U.S. emissions of GHGs, including carbon dioxide and
methane.  ACESA would require a 17% reduction in GHG emissions from
2005 levels by 2020 and just over an 80% reduction of such emissions by
2050.  Under this legislation, the EPA would issue a capped and
steadily declining number of tradable emissions allowances authorizing emissions
of GHGs into the atmosphere.  These reductions would be expected to
cause the cost of allowances to escalate significantly over time.  The
net effect of ACESA will be to impose increasing costs on the combustion of
carbon based fuels such as oil, refined petroleum products and natural
gas.  The U.S. Senate has begun work on its own legislation for
restricting domestic GHG emissions and the Obama Administration has indicated
its support for legislation to reduce GHG emissions through an emission
allowance system.  At the state level, more than one third of the
states, either individually or through multistate regional initiatives, already
have begun implementing legal measures to reduce emissions of
GHGs.  The adoption and implementation of any regulations imposing
reporting obligations on, or limiting emissions of GHGs from, our equipment and
operations could require us to incur costs to reduce emissions of GHGS
associated with our operations or could adversely affect demand for the oil and
natural gas that we produce.





An
investment in our common units involves various risks.  When
considering an investment in us, you should consider carefully all of the risk
factors described in our Annual Report on Form 10–K for the year ended December
31, 2009.  These risks and uncertainties are not the only ones facing
us and there may be additional matters that we are unaware of or that we
currently consider immaterial.  All of these could adversely affect
our business, financial condition, results of operations and cash flows and,
thus, the value of an investment in us.





ITEM 2. UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS





None.





ITEM 3. DEFAULTS UPON SENIOR
SECURITIES





None.





ITEM 4. (Removed and
Reserved)


21





ITEM 5. OTHER
INFORMATION





None.





ITEM
6. EXHIBITS





The
exhibits listed below are filed or furnished as part of this
report:




1.1
            Underwriting
      Agreement dated as of February 9, 2010, among EV Energy Partners, L.P., EV
      Energy GP, L.P., EV Management, LLC, EV Properties, L.P., EV Properties
      GP, LLC, RBC Capital Markets Corporation, Citigroup Global Markets Inc.,
      Raymond James & Associates, Inc. and Wells Fargo Securities, LLC, as
      representatives of the several underwriters named therein (Incorporated by
      reference from Exhibit 1.1 to EV Energy Partners, L.P.’s current report on
      Form 8–K filed with the SEC on February 12,
  2010).





2.1
            Purchase
      and Sale Agreement by and between Range Resources – Appalachia, LLC and
      EnerVest Institutional Fund XI–A, L.P., EnerVest Institutional Fund XI–WI,
      L.P., CGAS Properties, L.P. and EnerVest Operating, L.L.C. dated February
      5, 2010 (Incorporated by reference from Exhibit 2.1 to EV Energy Partners
      L.P.’s current report on Form 8–K filed with the SEC on February 8,
      2010).





10.1
            Fourth
      Amendment dated April 26, 2010 to Amended and Restated Credit Agreement
      (Incorporated by reference from Exhibit 10.1 to EV Energy Partners L.P.’s
      current report on Form 8–K filed with the SEC on April 30,
      2010).





+31.1
            Rule 13a-14(a)/15d-14(a)
      Certification of Chief Executive
Officer.





+31.2
            Rule 13a-14(a)/15d-14(a)
      Certification of Chief Financial
Officer.





+32
      .1
            Section 1350
      Certification of Chief Executive
Officer





+32.2
            Section
      1350 Certification of Chief Financial
Officer





+  Filed
herewith


22


SIGNATURES





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





EV Energy Partners, L.P.(Registrant)Date:  May
      10, 2010
                  By:
                  /s/
      MICHAEL E. MERCERMichael
      E. MercerSenior
      Vice President and Chief Financial
Officer




23





EXHIBIT
INDEX





1.1
            Underwriting
      Agreement dated as of February 9, 2010, among EV Energy Partners, L.P., EV
      Energy GP, L.P., EV Management, LLC, EV Properties, L.P., EV Properties
      GP, LLC, RBC Capital Markets Corporation, Citigroup Global Markets Inc.,
      Raymond James & Associates, Inc. and Wells Fargo Securities, LLC, as
      representatives of the several underwriters named therein (Incorporated by
      reference from Exhibit 1.1 to EV Energy Partners, L.P.’s current report on
      Form 8–K filed with the SEC on February 12,
  2010).





2.1
            Purchase
      and Sale Agreement by and between Range Resources – Appalachia, LLC and
      EnerVest Institutional Fund XI–A, L.P., EnerVest Institutional Fund XI–WI,
      L.P., CGAS Properties, L.P. and EnerVest Operating, L.L.C. dated February
      5, 2010 (Incorporated by reference from Exhibit 2.1 to EV Energy Partners
      L.P.’s current report on Form 8–K filed with the SEC on February 8,
      2010).





10.1
            Fourth
      Amendment dated April 26, 2010 to Amended and Restated Credit Agreement
      (Incorporated by reference from Exhibit 10.1 to EV Energy Partners L.P.’s
      current report on Form 8–K filed with the SEC on April 30,
      2010).





+31.1
            Rule 13a-14(a)/15d-14(a)
      Certification of Chief Executive
Officer.





+31.2
            Rule 13a-14(a)/15d-14(a)
      Certification of Chief Financial
Officer.





+32
      .1
            Section 1350
      Certification of Chief Executive
Officer





+32.2
            Section
      1350 Certification of Chief Financial
Officer





+  Filed
herewith