Houston-based EV Energy Partners LP (EVEP) continued to hunker down during the third quarter, with distributions to its unitholders still suspended while the company awaits higher commodity prices.

The upstream master limited partnership (MLP), which owns assets in the Barnett Shale, the San Juan Basin, the Austin Chalk, the Appalachian Basin, the Midcontinent and other areas, produced 195.3 MMcfe/d in the third quarter, a 3% quarter/quarter decrease but a 27% increase from the year-ago period.

Production included 12.5 Bcf of natural gas, 308,000 bbl of oil and 597,000 bbl of natural gas liquids (NGL).

But the balance sheet remained the focus during the quarter, management said. Total production costs declined to $1.54/Mcfe in the quarter, down from $1.69/Mcfe in the year-ago period.

“Overall, third quarter results came in as expected and were in line with our guidance,” Executive Chairman John Walker said during a short conference call with analysts Wednesday. “Our asset teams continued to deliver with further operating cost reductions on both an absolute and a per-Mcf basis. This is a difficult task when we really aren’t spending much money on drilling, and existing production has some natural decline, as you’re aware.”

Walker said the MLP is positioned to fulfill all covenants with creditors at current strip prices at least through the end of next year. But growth and a return to distribution payouts is going to take improvement in commodity prices, he said.

“EnerVest created EVEP purposefully, and we continue to believe that many investors want to own yield securities. We also believe that there will be significant asset acquisition opportunities, including dropdowns from our institutional partnerships, for EVEP in a sustained rebound. The keys for a rejuvenated acquisition effort are higher oil, NGL and natural gas prices, a higher unit price and an open equity market,” Walker said.

“…I own over 2.6 million units, and I’m EVEP’s largest single unitholder. Like all of you, I want the company to earn enough to be in a positive position to pay out distributions, and I want to see those units rebound and grow. We need higher commodity prices to accomplish that, and obviously that is out of our control.”

CFO Nick Bobrowski said EVEP spent $1.3 million in capital during 3Q2016 and expects to spend about the same in the fourth quarter, in line with guidance. “We’re just now starting our budget process” for 2017, “but given where prices are we would expect to spend more next year than we spent this year,” he said.

EVEP reported revenues of $51.4 million for the quarter, compared with $38.3 million in the year-ago. Realized prices averaged $40.40/bbl for oil, $14.23/bbl for NGLs and $2.38/Mcf for gas. That’s compared with year-ago prices of $41.27/bbl, $11.93/bbl and $2.32/Mcf, respectively.

EVEP reported a net loss of $19.2 million for the quarter (minus $38 cents/unit), compared with a net loss of $9.8 million (minus 20 cents/unit) in the year-ago period.

The MLP reported distributable cash flow (DCF) of $6.4 million for the quarter, compared with DCF of $20.1 million in 3Q2015.