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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the Quarterly Period Ended June 30, 2004

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

For the Transition Period Ended _______________________

Commission File Number 2-84452-01

STERLING DRILLING FUND 1983-2

(Exact name of registrant as specified in charter)

New York

(State or other jurisdiction of corporation or organization)

13-3167551

(IRS employer identification number)

One Landmark Square, Stamford, Connecticut 06901

(Address and Zip Code of principal executive offices)

(203) 358-5700

(Registrant's telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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

Yes /X/ No

Indicate by check mark whether the registrant is an accelerated filer ( as defined in Rule 12b-2 of the Exchange Acts). Yes ___ NO /X/

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Sterling Drilling Fund 1983-2

Index to Form 10Q

Part 1:

Item 1. Financial Statements

Balance Sheets-June 30, 2004 and December 31, 2003.	3
Statements of Operations for the Six and Three Months Ended June 30, 2004 and 2003.	4-7
Statements of Changes in Partners' Equity for the Six and Three Months Ended June 30, 2004 and 2003.	8-9
Statements of Cash Flows for the Six Months Ended June 30, 2004 and 2003.	10
Note to the Financial Statements	11

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	12-14

Item 3. Quantitative and Qualitative Disclosures About Market Risk	14

Item 4. Controls and Procedures	15

Part II. Other Information	16

Signature	17

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Balance Sheet

		June 30, 2004		December 31, 2003
		(unaudited)		(audited)
Assets
Current assets:
Cash and cash equivalents	$	398,031	$	270,267
Due from affiliates		91,970		9,020
		----------------		-----------------
Total current assets		490,001		279,287
		----------------		-----------------
Oil and gas properties - successful efforts method
Leasehold costs		497,639		497,639
Well and related facilities		13,071,867		13,071,867
Less accumulated depreciation, depletion and
Amortization		(12,614,960)		(12,588,547)
		-----------------		-----------------
		954,546		980,959
		-----------------		-----------------
Total assets	$	1,444,547	$	1,260,246
		==========		==========
Partners' equity
Limited partners	$	1,344,673	$	1,207,644
General partners		99,874		52,602
		-----------------		-----------------
Total partners' equity	$	1,444,547	$	1,260,246
		==========		==========

See accompanying note to financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statement of Operations

(unaudited)

Six Months Ending June 30, 2004


		Limited Partners		General Partners		Total
Revenue:
Operating revenue	$	313,746	$	96,380	$	410,126
Interest income		1,148		352		1,500
		-----------		-----------		-----------
Total Revenue		314,894		96,732		411,626
		-----------		-----------		-----------

Costs and Expenses:
Production expense		107,190		32,928		140,118
General and administrative to a related party		38,556		11,844		50,400
General and administrative		7,951		2,443		10,394
Depreciation, depletion and amortization		24,168		2,245		26,413
		-----------		-----------		-----------
Total Costs and Expenses		177,865		49,460		227,325
		-----------		-----------		-----------

Net Income	$	137,029	$	47,272	$	184,301
		=======		=======		=======
Net Income per equity unit	$	8.73
		======

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statement of Operations

(unaudited)

Six Months Ending June 30, 2003


		Limited Partners		General Partners		Total
Revenue:
Operating revenue	$	251,436	$	77,239	$	328,675
Interest income		1,001		93		1,094
		------------		------------		------------
Total Revenue		252,437		77,332		329,769
		------------		------------		------------

Costs and Expenses:
Production expense		107,039		32,881		139,920
General and administrative to a related party		38,556		11,844		50,400
General and administrative		7,998		2,457		10,455
Depreciation, depletion and amortization		28,351		2,634		30,985
		------------		------------		------------
Total Costs and Expenses		181,944		49,816		231,760
		------------		------------		------------
Net Income	$	70,493	$	27,516	$	98,009
		=======		=======		=======

Net Income per equity unit	$	4.49
		========

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statement of Operations

(unaudited)

Three Months Ending June 30, 2004


		Limited Partners		General Partners		Total
Revenue:
Operating revenue	$	161,939	$	49,746	$	211,685
Interest income		652		200		852
		------------		-----------		------------
Total Revenue		162,591		49,946		212,537
		------------		-----------		------------

Costs and Expenses:
Production expense		74,553		22,902		97,455
General and administrative to a related party		19,278		5,922		25,200
General and administrative		5,719		1,757		7,476
Depreciation, depletion and amortization		12,085		1,122		13,207
		------------		-----------		------------
Total Costs and Expenses		111,635		31,703		143,338
		------------		-----------		------------
Net Income	$	50,956	$	18,243	$	69,199
		=======		=======		=======

Net Income per equity unit	$	3.25
		=======

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statement of Operations

(unaudited)

Three Months Ending June 30, 2003


		Limited Partners		General Partners		Total
Revenue:
Operating revenue	$	121,098	$	37,201	$	158,299
Interest income		503		47		550
		------------		------------		------------
Total Revenue		121,601		37,248		158,849
		------------		------------		------------

Costs and Expenses:
Production expense		55,682		17,105		72,787
General and administrative to a related party		19,278		5,922		25,200
General and administrative		5,216		1,602		6,818
Depreciation, depletion and amortization		14,175		1,317		15,492
		------------		------------		------------
Total Costs and Expenses		94,351		25,946		120,297
		------------		------------		------------
Net Income	$	27,250	$	11,302	$	38,552
		=======		=======		=======

Net Income per equity unit	$	1.74
		=======

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statements of Changes in Partners' Equity

(unaudited)

Six Months Ended

June 30, 2004

		Limited Partners		General Partners		Total

Balance at beginning of period	$	1,207,644	$	52,602	$	1,260,246
Net Income		137,029		47,272		184,301
		-------------		-------------		-------------
Balance at end of period	$	1,344,673	$	99,874	$	1,444,547
		========		========		=========

Six Months Ended

June 30, 2003

		Limited Partners		General Partners		Total

Balance at beginning of period	$	1,195,487	$	39,137	$	1,234,624
Distribution to partners		(78,485)		(24,110)		(102,595)
Net Income		70,493		27,516		98,009
		-------------		-------------		-------------
Balance at end of period	$	1,187,495	$	42,543	$	1,230,038
		========		========		=========

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statements of Changes in Partners' Equity

(unaudited)

Three Months Ended

June 30, 2004

		Limited Partners		General Partners		Total

Balance at beginning of period	$	1,293,717	$	81,631	$	1,375,348
Net Income		50,956		18,243		69,199
		-------------		-------------		-------------
Balance at end of period	$	1,344,673	$	99,874	$	1,444,547
		========		========		========

Three Months Ended

June 30, 2003

		Limited Partners		General Partners		Total

Balance at beginning of period	$	1,238,730	$	55,351	$	1,294,081
Distribution to partners		(78,485)		(24,110)		(102,595)
Net Income		27,250		11,302		38,552
		-------------		-------------		-------------
Balance at end of period	$	1,187,495	$	42,543	$	1,230,038
		========		========		========

See accompanying note to the financial statements.

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STERLING DRILLING FUND 1983-2

(a New York Limited Partnership)

Statement of Cash Flows

(unaudited)

		Six months Ended June 30, 2004		Six months Ended June 30, 2003

Net cash provided by operating activities	$	127,764	$	109,317
		------------		-------------

Cash flows from financing activities:
Distribution to partners		-		(102,595)
		------------		-------------
Net cash used in financing activities		-		(102,595)
		------------		-------------

Net increase in cash and cash equivalents		127,764		6,722

Cash and cash equivalents at beginning of period		270,267		160,778
		-------------		--------------
Cash and cash equivalents at end of period	$	398,031	$	167,500
		========		========

See accompanying note to financial statements.

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STERLING DRILLING FUND 1983-2

(a New York limited partnership)

Note to Financial Statements

June 30, 2004

1. The accompanying statements for the period ending June 30, 2004, are unaudited but reflect all adjustments necessary to present fairly the financial condition and results of operations.

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PART I

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

Liquidity -

The oil and gas industry is intensely competitive in all its phases. There is also competition between this industry and other industries in supplying energy and fuel requirements of industrial and residential consumers. It is not possible for the Registrant to calculate its position in the industry as the Registrant competes with many other companies having substantially greater financial and other resources. In accordance with the terms of the Agreement of Limited Partnership of the Partnership, the General Partners of the Registrant will make cash distributions of as much of the Partnership cash credited to the capital accounts of the partners as the General Partners have determined is not necessary or desirable for the payment of any contingent debts, liabilities or expenses for the conduct of the Partnership business. As of June 30, 2004, the General partners have distributed $2,221,126 or 14.15%, of original Limited Partner capital contributions, to the Limited Partners.

The net proved oil and gas reserves of the Partnership are considered to be a primary indicator of financial strength and future liquidity. Overall reservoir engineering is a subjective process of estimating underground accumulations of gas and oil that cannot be measured in an exact manner. The estimated reserve quantities and future income quantities are related to hydrocarbon prices. Therefore, volumes of reserves actually recovered and amounts of income actually received may differ significantly from the estimated quantities presented in this report.

In accordance with FASB Statement No. 69, December 31, 2003 market prices were determined using the daily oil price or daily gas sales price ("spot price") adjusted for oilfield or gas gathering hub and wellhead price differentials (e.g. grade, transportation, gravity, sulfur, and BS&W) as appropriate. Also, in accordance with SEC and FASB specifications, changes in market prices subsequent to December 31, 2003 and 2002 were not considered. The spot price for gas at December 31, 2003 was $5.97 per MMBTU. The range of spot prices during the year 2003 was a low of $3.96, a high of $12.20 and the average was $5.48. The spot price for gas at December 31, 2002 was $4.58 per MMBTU. The range of spot prices during the year 2002 was a low of $1.98, a high of $5.05 and the average was $3.38. The range during the first six months of 2004 has been from $5.08 to $7.01 with an average of $5.86. The recent futures market prices have been in the $5.96 range.

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The present value of unescalated future net revenues (S.E.C. case) associated with such reserves, discounted at 10% as of December 31, 2002, was approximately $2,491,356 as compared to the discounted reserves as of December 31, 2003, which were approximately $3,778,957. While it may reasonably be anticipated that the prices received by Sterling Drilling Fund 1983-2 for the sale of its production may be higher or lower than the prices used in this evaluation, as described above, and the operating costs relating to such production may also increase or decrease from existing levels, such possible changes in prices and costs were, in accordance with rules adopted by the SEC, omitted from consideration in making this evaluation for the SEC case. Actual volumes produced, prices received and costs incurred by the partnership may vary significantly from the SEC case.

Capital Resources -

The Registrant was formed for the sole intention of drilling oil and gas wells. The Registrant entered into a drilling contract with an independent contractor in December 1983 for $13,400,000. Pursuant to terms of this contract, fifty-two wells have been drilled resulting in fifty-one producing wells and one dry hole.

During 2002, PrimeEnergy Management negotiated a Farmout Agreement with Ardent Resources Inc. covering leasehold interests in acres located in Calhoun County, West Virginia. Pursuant to this agreement, Ardent has the right but not the obligation to select acreage and drill a deep well on the selected acreage, subject to an overriding royalty interest due to the leasehold owners. If a test well is not spudded by February 13, 2005 this agreement terminates. Acreage held by Sterling Drilling Fund 1983-2 was included in the Farmout Agreement, PrimeEnergy Management may discuss the possibility of farming out additional deep rights held by the Partnership under the same terms with other parties, however, there is no guarantee that any agreement will be entered into.

Results of Operations -

The Partnership entered into an annual contract to sell its gas produced at spot market price with any necessary price adjustment due to BTU content or transportation deduction owed. This contract will allow the partnership to take advantage of current high spot prices. A portion of the Partnership's wells were shut-in during November and December 2003 due to a fire at a compressor plant on one of the Purchaser's transportation lines servicing the Partnership wells. All wells were back on line as of December 31, 2003 due to the main transport lines being re-routed around the compressor plant. The Partnership experienced an increase in its gas production, from 59,751 MCF in 2003 compared to 61,177 MCF in 2004. The average price per MCF increased from $5.04 in 2003 compared to $6.50 in the 2004. The operating revenue increased from $328,675 in 2003 compared to $410,126 in 2004.

The Partnership did not receive any other income during the first half of 2004. Production expenses increased from $139,920 in 2003 to $140,118 in 2004. The current production expenses include variable costs associated with volume changes, repairs, and labor costs associated the any supplementary repairs and recompletions. The production volume variations can be a result of changes in transportation line pressures, miscellaneous shut-ins for maintenance and natural declines.

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Management continues to minimize third party costs and use in-house resources to provide efficient and timely services to the Partnership. The related party general and administrative expenses are charged in accordance with guidelines set forth in the Registrant's Management Agreement and are attributable to the affairs and operations of the Partnership and shall not exceed an annual amount equal to 5% of the Limited Partners capital contributions. Amounts related to both 2003 and 2004 are substantially less than the amounts allocable to the Registrant under the Partnership Agreement.

The Partnership records additional depreciation, depletion and amortization to the extent that net capitalized costs exceed the undiscounted future net cash flows attributable to the Partnership properties. The Partnership was not required to revise the properties basis in 2003 or during the first six months of 2004. The current depreciation was reasonable based upon the remaining basis in the Partnership properties.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Oil and gas prices have historically been extremely volatile, and have been particularly so in recent years. The Partnership did not enter into significant hedging transactions during the second quarter of 2004 and had no open hedging transactions at June 30, 2004 or December 31, 2003. Declines in domestic oil and gas prices could have a material adverse effect on the Partnership's revenues, operating results, estimates of economically recoverable reserves and the net revenue therefrom.

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Item 4 Controls and Procedures

PrimeEnergy Management Corporation ("PEMC"), the Managing General Partner of the Partnership, maintains a system of controls and procedures designed to provide reasonable assurance as to the reliability of the financial statements and other disclosures included in this report, as well as to safeguard assets from unauthorized use or disposition. Within 90 days prior to the filing of this report, PEMC's Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the design and operation of disclosure controls and procedures with the assistance and participation of other members of management. Based upon that evaluation, PEMC's Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures are effective for gathering, analyzing and disclosing the information the Partnership is required to disclose in the reports it files under the Securities Exchange Act of 1934 within the time periods specified in the SEC's rules and forms. There have been no significant changes in PEMC's internal controls or in other factors which could significantly affect internal controls subsequent to the date PEMC carried out its evaluation.

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PART II Other Information:

Items 1 through 5 have been omitted in that each item is either not applicable or the answer is negative.

Item 6: Exhibits and Reports on Form 8-K

(a) Exhibit 31.1 Chief Executive Officer certification under Section 302

of Sarbanes-Oxley Act of 2002.

(b) Exhibit 31.2 Chief Financial Officer certification under Section 302

of Sarbanes-Oxley Act of 2002.

Pursuant To Section 906 Of The Sarbanes-Oxley Act of 2002

(d) Exhibit 32.2: Certification Pursuant to 18 U.S.C. Section 1350, As Adopted

Pursuant To Section 906 Of The Sarbanes-Oxley Act of 2002

(e)Form 8-K: The Partnership was not required to file any reports on Form 8-K and no

such form was filed during the period covered by this report.

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S I G N A T U R E S

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

STERLING DRILLING FUND 1983-2

(Registrant)

By: /S/ Charles E. Drimal Jr.

------------------------------

Charles E. Drimal, Jr

General Partner

August 13, 2004

(Date)

STERLING DRILLING FUND 1983-2 10-Q