PERMIAN BASIN ROYALTY TRUST ANNOUNCES MARCH CASH DISTRIBUTION

Rhea-AI Summary

Simmons Bank, as Trustee of the Permian Basin Royalty Trust (NYSE: PBT), declared a cash distribution of $0.019331 per unit, payable on April 14, 2022, to unit holders of record by March 31, 2022. This distribution reflects a decrease due to reduced oil and gas production, despite favorable pricing. Notably, the Waddell Ranch remains in deficit, impacting future distributions. In January, Waddell Ranch produced 146,556 barrels of oil and 486,150 Mcf of gas, generating $14.4 million in gross revenue. General and Administrative expenses deducted were $238,697.

Positive

• Texas Royalty properties generated net profit of $1,139,698 contributing to this month's distribution.
• Projected capital expenditures for Waddell Ranch for 2022 estimated at $92 million for further developments.

Negative

• Cash distribution decreased from the previous month due to lower production levels.
• Waddell Ranch is in a deficit of $6.6 million net, affecting future distributions.
• General and Administrative expenses deducted were $238,697, impacting net distribution.

DALLAS, March 21, 2022 /PRNewswire/ -- Simmons Bank, as Trustee of the Permian Basin Royalty Trust (NYSE: PBT) ("Permian") today declared a cash distribution to the holders of its units of beneficial interest of $0.019331 per unit, payable on April 14, 2022, to unit holders of record on March 31, 2022.

This month's distribution decreased from the previous month as the result of a decrease in the production offset by pricing of oil and gas for the Texas Royalty Properties during the month of January.  The timing of receipts from some of the larger remitters was delayed due to the end of the month of February.  These receipts will be posted in the following month. Currently, only the Texas Royalty Properties are contributing to the monthly distribution.

Since the Waddell Ranch is in current deficit for the foreseeable future, any increase or decrease of the distribution by revenues received, will only be reflective of the activity of the Texas Royalty Properties.  The activity of the Waddell Ranch will be discussed with the following narrative until it contributes back to the distribution.  This reflects the production month of January.

WADDELL RANCH
In reporting January production of the Underlying Properties for this month's press release, production for oil volumes was 146,556 (gross) and was priced at about $81.06 per bbl.  Production for gas volumes (including gas liquids) was 486,150 Mcf (gross) and was priced at about $6.82 per Mcf, which now includes the value received from plant products and natural gas liquids.  Net revenue for the underlying properties of the Waddell ranch was $14,428,514 (gross) for January.  Lease Operating Expenses were $2,930,402 (gross) and Capital Expenditures were $6,322,184 (gross) for January. This would put the Trust's proceeds as a positive $3,881,946 (net) for the month of January, leaving an excess cost deficit cumulative of $6.6 million (net).

A review and update on the ongoing 2021 budget are as follows.  The 2021 budget (net to the Trust) has expended through December 2021, approximately $56.0 million, recompleting 47.4 existing wells along with drilling 29.7 new wells to completion, with 4.1 recompletions and 4.1 new drills remaining to be fully completed for the 2021 budget.  This has resulted in production of approximately 655,000 barrels of oil and 1.5 Bcf of gas, generating $51.1 million in gross revenue through December 2021, all net to the Trust.

As of the end of January, approximately $55.4 million of net profit revenue has been generated by the 2020-2021 budgeted projects.

Blackbeard has advised the Trustee of the projected 2022 capital expenditure budget for the Waddell Ranch Properties to be an estimated $92 million (net to the Trust) with a projected about 47 new drill wells and 45 recompletions along with about 19 plug and abandoned wells.  Of the new drill wells, about 13 will be horizontal drills and about 34 vertical drill wells.  In the Form 10-K, to be filed in March, further discussion will be provided.

TEXAS ROYALTY PROPERTIES
Production for the underlying properties at the Texas Royalties was 15,800 barrels of oil and 7,645 Mcf of gas.  The production for the Trust's allocated portion of the Texas Royalties was 14,073 barrels of oil and 6,798 Mcf of gas.  The average price for oil was $77.97 per bbl and for gas was $13.26 per Mcf.  This would primarily reflect production and pricing for the month of January for oil and the month of December for gas. These allocated volumes were impacted by the pricing of both oil and gas. This production and pricing for the underlying properties resulted in revenues for the Texas Royalties of $1,333,243.  Deducted from these were taxes of $133,560 resulting in a Net Profit of $1,199,683 for the month of January.  With the Trust's Net Profit Interest (NPI) of 95% of the Underlying Properties, this would result in net contribution by the Texas Royalties of $1,139,698 to this month's distribution. 

	Underlying Properties		Net to Trust Sales
	Volumes		Volumes		Average	Price
	Oil (bbls)	Gas (Mcf)	Oil (bbls)	Gas (Mcf)	Oil  (per bbl)	Gas (per Mcf)
Current Month
Waddell Ranch	146,556	486,150	109,917	364,613*	$81.06	$6.82**
Texas Royalties	15,800	7,645	14,073	6,798*	$77.97	$13.26**
Prior Month
Waddell Ranch	145,009	538,676	108,757	404,007*	$70.13	$6.84**
Texas Royalties	19,178	13,138	19,250	13,194*	$71.62	$6.94**

 

*These volumes are the net to the trust, after allocation of expenses to Trust's net profit interest, including any prior period adjustments.

**This pricing includes sales of gas liquid products.

General and Administrative Expenses deducted for the month were $238,697 resulting in a distribution of $901,040 to 46,608,796 units outstanding, or $0.019331 per unit.

The worldwide market conditions continue to affect the pricing for domestic production.  It is difficult to predict what effect these conditions will have on future distributions.

The 2021 tax information packets were mailed directly to unit holders in early March 2022.  A copy of Permian's 2021 tax information booklet is posted on Permian's website. In addition to the tax booklet the Permian website also offers two simple calculators for computing the income and expense amounts and the cost depletion. To facilitate unit holder tax preparation, both the income and expense and the depletion calculators have been updated on Permian's website for 2021 tax reporting.

The 2020 Annual Report with Form 10-K and the January 1, 2021 Reserve Summary are now available on Permian's website.  Permian's cash distribution history, current and prior year financial reports, tax information booklets, and a link to filings made with the Securities and Exchange Commission, all can be found on Permian's website at http://www.pbt-permian.com/.  Additionally, printed reports can be requested and are mailed free of charge.

Contact: Ron Hooper, Senior Vice President, Simmons Bank, Trustee, Toll Free – 1.855.588.7839

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SOURCE Permian Basin Royalty Trust

FAQ

What is the cash distribution amount declared by Permian Basin Royalty Trust (PBT) for March 2022?

The cash distribution declared is $0.019331 per unit.

When will the cash distribution for PBT be payable?

The cash distribution will be payable on April 14, 2022.

What caused the decrease in cash distribution for PBT?

The decrease was caused by lower oil and gas production despite favorable pricing.

What are the projected capital expenditures for Waddell Ranch in 2022?

The projected capital expenditures for Waddell Ranch are estimated at $92 million.

What net profit was generated from the Texas Royalty properties for PBT in January?

The Texas Royalty properties generated a net profit of $1,139,698.