United States 12 Month Natural Gas Fund, LP 10-Q for FY2023 Q2

United States 12 Month Natural Gas Fund, LP (UNL)

10-Q 2023-08-04 For: 2023-06-30

Added on April 11, 2026

About this 10-Q

United States 12 Month Natural Gas Fund, LP filed this 10-Q on August 4, 2023, covering the quarter ended June 30, 2023 (FY2023 Q2).

Headline figures

Quarter ended June 30, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: -$138.18K; compared with -$7.38M a year earlier
Net loss: $173.14K; compared with a net loss of $7.47M a year earlier

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Delaware		26-0431733
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)


Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:
Shares of United States 12 Month Natural Gas Fund, LP	UNL	NYSE Arca, Inc.


Large Accelerated Filer	☐	Accelerated Filer	☐

Non-Accelerated Filer	☒	Smaller Reporting Company	☐

Emerging Growth Company	☐


Part I. FINANCIAL INFORMATION	Page

Item I. Condensed Financial Statements.	3

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	19

Item 3. Quantitative and Qualitative Disclosures About Market Risk.	37

Item 4. Controls and Procedures.	38

Part II. OTHER INFORMATION

Item 1. Legal Proceedings.	39

Item 1A. Risk Factors.	41

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	42

Item 3. Defaults Upon Senior Securities.	42

Item 4. Mine Safety Disclosures.	42

Item 5. Other Information.	42

Item 6. Exhibits.	43


Documents		Page

Condensed Statements of Financial Condition at June 30, 2023 (Unaudited) and December 31, 2022		4

Condensed Schedule of Investments (Unaudited) at June 30, 2023		5

Condensed Statements of Operations (Unaudited) for the three and six months ended June 30, 2023 and 2022		6

Condensed Statements of Changes in Partners’ Capital (Unaudited) for the three and six months ended June 30, 2023 and 2022		7

Condensed Statements of Cash Flows (Unaudited) for the six months ended June 30, 2023 and 2022		8

Notes to Condensed Financial Statements (Unaudited) for the period ended June 30, 2023		9


	June 30, 2023		December 31, 2022
Assets
Cash and cash equivalents (at cost $14,868,034 and $22,036,438, respectively) (Notes 2 and 5)	$	14,868,034	$	22,036,438
Equity in trading accounts:
Cash and cash equivalents (at cost $6,824,088 and $11,220,362, respectively)		6,824,088		11,220,362
Unrealized gain (loss) on open commodity futures contracts		(4,553,541)		(8,419,740)
Receivable from General Partner (Note 3)		58,685		163,576
Dividends receivable		57,636		94,005
Interest receivable		7,476		7,826
Prepaid professional fees		20,842		—
Prepaid license fees		7,451		6,760
Prepaid insurance^*		6,602		760
Total Assets	$	17,297,273	$	25,109,987

Liabilities and Partners’ Capital
General Partner management fees payable (Note 3)	$	10,275	$	20,071
Professional fees payable		13,513		94,745
Brokerage commissions payable		391		391
Directors’ fees payable^*		2,801		2,846
Total Liabilities		26,980		118,053

Commitments and Contingencies (Notes 3, 4 & 5)

Partners’ Capital
General Partners		—		—
Limited Partners		17,270,293		24,991,934
Total Partners’ Capital		17,270,293		24,991,934

Total Liabilities and Partners’ Capital	$	17,297,273	$	25,109,987

Limited Partners’ shares outstanding		1,500,000		1,450,000
Net asset value per share	$	11.51	$	17.24
Market value per share	$	11.52	$	17.23


				Fair
				Value/Unrealized
				Gain (Loss) on
				Open
			Number of	Commodity		% of Partners’
	Notional Amount		Contracts	Contracts		Capital
Open Commodity Futures Contracts – Long
United States Contracts
NYMEX Natural Gas Futures NG August 2023 contracts, expiring July 2023	$	1,898,075	44	$	(666,955)	(3.86)
NYMEX Natural Gas Futures NG September 2023 contracts, expiring August 2023		2,005,013	44		(784,453)	(4.54)
NYMEX Natural Gas Futures NG October 2023 contracts, expiring September 2023		2,203,185	44		(950,505)	(5.50)
NYMEX Natural Gas Futures NG November 2023 contracts, expiring October 2023		2,148,179	44		(735,339)	(4.26)
NYMEX Natural Gas Futures NG December 2023 contracts, expiring November 2023		2,166,927	44		(573,247)	(3.32)
NYMEX Natural Gas Futures NG January 2024 contracts, expiring December 2023		2,291,651	43		(636,581)	(3.69)
NYMEX Natural Gas Futures NG February 2024 contracts, expiring January 2024		1,890,659	44		(229,659)	(1.33)
NYMEX Natural Gas Futures NG March 2024 contracts, expiring February 2024		1,607,294	44		(65,974)	(0.38)
NYMEX Natural Gas Futures NG April 2024 contracts, expiring March 2024		1,405,117	44		(3,717)	(0.02)
NYMEX Natural Gas Futures NG May 2024 contracts, expiring April 2024		1,354,458	44		39,022	0.22
NYMEX Natural Gas Futures NG June 2024 contracts, expiring May 2024		1,409,543	44		24,857	0.14
NYMEX Natural Gas Futures NG July 2024 contracts, expiring June 2024		1,450,710	44		29,010	0.17
Total Open Futures Contracts*	$	21,830,811	527	$	(4,553,541)	(26.37)


	Shares/Principal				% of Partners’
	Amount		Market Value		Capital
Cash Equivalents
United States Money Market Funds
Morgan Stanley Institutional Liquidity Funds - Government Portfolio - Institutional Shares, 5.02%#		14,600,000	$	14,600,000	84.54
Total United States Money Market Funds			$	14,600,000	84.54


	Three months ended		Three months ended		Six months ended		Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Income
Gain (loss) on trading of commodity futures contracts:
Realized gain (loss) on closed commodity futures contracts	$	(3,678,901)	$	6,372,072	$	(11,932,289)	$	10,102,488
Change in unrealized gain (loss) on open commodity futures contracts		3,351,632		(13,819,013)		3,866,199		(7,367,059)
Dividend income		166,007		65,730		324,662		68,689
Interest income^*		21,680		15		40,717		134
ETF transaction fees		1,400		4,900		2,800		6,650
Total Income (Loss)	$	(138,182)	$	(7,376,296)	$	(7,697,911)	$	2,810,902

Expenses
General Partner management fees (Note 3)	$	29,128	$	78,698	$	60,461	$	123,731
Professional fees		30,096		59,116		59,438		80,364
Brokerage commissions		1,243		3,036		2,932		5,223
Directors’ fees and insurance		3,620		3,619		7,199		6,883
License fees		583		1,573		1,209		2,474
Total Expenses		64,670		146,042		131,239		218,675
Expense waiver (Note 3)		(29,715)		(52,406)		(58,685)		(70,199)
Net Expenses	$	34,955	$	93,636	$	72,554	$	148,476
Net Income (Loss)	$	(173,137)	$	(7,469,932)	$	(7,770,465)	$	2,662,426
Net Income (Loss) per limited partner share	$	(0.15)	$	(0.23)	$	(5.73)	$	6.03
Net Income (Loss) per weighted average limited partner share	$	(0.12)	$	(4.12)	$	(5.83)	$	1.51
Weighted average limited partner shares outstanding		1,401,648		1,811,538		1,332,320		1,757,459


	Limited Partners^*
	Three months ended		Three months ended		Six months ended		Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Balances at beginning of period	$	14,574,165	$	23,286,424	$	24,991,934	$	16,312,586
Addition of 250,000, 1,250,000, 450,000 and 1,800,000 partnership shares, respectively		2,869,265		30,819,750		5,458,754		37,717,117
Redemption of (–), (450,000), (400,000) and (1,100,000) partnership shares, respectively		—		(9,500,774)		(5,409,930)		(19,556,661)
Net income (loss)		(173,137)		(7,469,932)		(7,770,465)		2,662,426

Balances at end of period	$	17,270,293	$	37,135,468	$	17,270,293	$	37,135,468


At June 30, 2023	Total		Level I		Level II		Level III
Short-Term Investments	$	14,600,000	$	14,600,000	$	—	$	—
Exchange-Traded Futures Contracts
United States Contracts		(4,553,541)		(4,553,541)		—		—


At December 31, 2022	Total		Level I		Level II		Level III
Short-Term Investments	$	22,000,000	$	22,000,000	$	—	$	—
Exchange-Traded Futures Contracts
United States Contracts		(8,419,740)		(8,419,740)		—		—


	Condensed
	Statements of
	Financial	Fair Value at		Fair Value at
Derivatives not Accounted for as Hedging Instruments	Condition Location	June 30, 2023		December 31, 2022
Futures - Commodity Contracts	Assets	$	(4,553,541)	$	(8,419,740)


	Total
	Number of	Average Price Per
Period	Shares Redeemed	Share
4/1/23 to 4/30/23	—	$	—
5/1/23 to 5/31/23	—	$	—
6/1/23 to 6/30/23	—	$	—
Total	—


Exhibit Number		Description of Document
31.1(1)		Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2(1)		Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1(1)		Certification by Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2(1)		Certification by Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase.
101.DEF		XBRL Taxonomy Extension Definition Linkbase.
101.LAB		XBRL Taxonomy Extension Label Linkbase.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).


	Six months ended		Six months ended
	June 30, 2023		June 30, 2022
Cash Flows from Operating Activities:
Net income (loss)	$	(7,770,465)	$	2,662,426
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Change in unrealized (gain) loss on open commodity futures contracts		(3,866,199)		7,367,059
(Increase) decrease in receivable from General Partner		104,891		58,549
(Increase) decrease in dividends receivable		36,369		(38,277)
(Increase) decrease in interest receivable		350		73
(Increase) decrease in prepaid professional fees		(20,842)		(327)
(Increase) decrease in prepaid other		(691)		(5,439)
(Increase) decrease in prepaid insurance^*		(5,842)		(2,036)
Increase (decrease) in General Partner management fees payable		(9,796)		21,573
Increase (decrease) in professional fees payable		(81,232)		(38,213)
Increase (decrease) in directors’ fees payable^*		(45)		29
Net cash provided by (used in) operating activities		(11,613,502)		10,025,417

Cash Flows from Financing Activities:
Addition of partnership shares		5,458,754		37,717,117
Redemption of partnership shares		(5,409,930)		(19,556,661)
Net cash provided by (used in) financing activities		48,824		18,160,456

Net Increase (Decrease) in Cash and Cash Equivalents		(11,564,678)		28,185,873

Total Cash, Cash Equivalents and Equity in Trading Accounts, beginning of period		33,256,800		15,705,957
Total Cash, Cash Equivalents and Equity in Trading Accounts, end of period	$	21,692,122	$	43,891,830

Components of Cash, Cash Equivalents, and Equity in Trading Accounts
Cash and cash equivalents	$	14,868,034	$	37,704,006
Equity in Trading Accounts:
Cash and cash equivalents		6,824,088		6,187,824
Total Cash, Cash Equivalents and Equity in Trading Accounts	$	21,692,122	$	43,891,830


	Six months ended			Six months ended
	June 30, 2023			June 30, 2022
Average daily total net assets	$	16,256,452		$	33,268,514
Dividend and interest income earned on Treasuries, cash and/or cash equivalents	$	365,379		$	68,823
Annualized yield based on average daily total net assets		4.53	%		0.42	%
Management fee	$	60,461		$	123,731
Total fees and other expenses excluding management fees	$	70,778		$	94,944
Total amount of the expense waiver	$	58,685		$	70,199
Expenses before the allowance of the expense waiver	$	131,239		$	218,675
Expenses after the allowance of the expense waiver	$	72,554		$	148,476
Total commissions accrued to brokers	$	2,932		$	5,223
Total commissions as annualized percentage of average total net assets		0.04	%		0.03	%


	Three months ended			Three months ended
	June 30, 2023			June 30, 2022
Average daily total net assets	$	15,577,293		$	42,087,963
Dividend and interest income earned on Treasuries, cash and/or cash equivalents	$	187,687		$	65,745
Annualized yield based on average daily total net assets		4.83	%		0.63	%
Management fee	$	29,128		$	78,698
Total fees and other expenses excluding management fees	$	35,542		$	67,344
Total amount of the expense waiver	$	29,715		$	52,406
Expenses before the allowance of the expense waiver	$	64,670		$	146,042
Expenses after the allowance of the expense waiver	$	34,955		$	93,636
Total commissions accrued to brokers	$	1,243		$	3,036
Total commissions as annualized percentage of average total net assets		0.03	%		0.03	%


By:	/s/ John P. Love
	John P. Love
	President and Chief Executive Officer
	(Principal executive officer)


By:	/s/ Stuart P. Crumbaugh
	Stuart P. Crumbaugh
	Chief Financial Officer
	(Principal financial and accounting officer)

Date: August 4, 2023

	By	/s/ John P. Love
	Name:	John P. Love
	Title:	President and Chief Executive Officer
		United States Commodity Funds LLC,
		General Partner of United States 12 Month Natural Gas Fund, LP