North European Oil Royalty Trust 8-K, filed Aug 3, 2020
North European Oil Royalty Trust (NRT)
About this 8-K
North European Oil Royalty Trust filed this 8-K on August 3, 2020, reporting on events of July 31, 2020.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND
EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM 8-K
NORTH EUROPEAN OIL
ROYALTY TRUST
Delaware 1-8245 22-2084119
State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation File Number) Identification No.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.below):
[ ] Written communication
pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant
to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement
communication pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement
communication pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Units of Beneficial Interest NRT New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR Section 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR Section 240.12b-2).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 2.02. Results of Operations and Financial Condition.
On July 31, 2020, North European Oil Royalty Trust issued a press release via PR Newswire announcing the Trust's distribution for the third quarter of fiscal 2020. Furnished herewith is a copy of the press release, which is incorporated by reference herein.
Item 9.01. Financial Statements and Exhibits.
(c) ExhibitsThe following exhibit is furnished herewith:
Exhibit 99. A press release dated July 31, 2020 and disseminated through PR Newswire announcing the distribution for North European Oil Royalty Trust for the third quarter of fiscal 2020.
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 hereunto duly authorized.
NORTH EUROPEAN OIL ROYALTY TRUST
(Registrant)
/s/ John R. Van Kirk
John R. Van Kirk
Managing Director
August 3, 2020
Exhibit 99
PR NEWSWIRE
Keene, N.H. July 31, 2020 - The Trustees of North European Oil Royalty Trust (NYSE-NRT) announced today a quarterly distribution of $0.11 per unit for the third quarter of fiscal 2020, payable on August 26, 2020 to holders of record on August 14, 2020. Natural gas sold during the second calendar quarter of 2020 is the primary source of royalty income on which the August 2020 distribution is based.
John R. Van Kirk, Managing Director, reported that this year's quarterly distribution of $0.11 per unit is 50%, or $0.11 per unit, lower than the distribution of $0.22 per unit for the third quarter of fiscal 2019. The Trustees have retained funds to cover anticipated expenses and the reduction in sales that will result from the announced five-week shutdown of Grossenkneten. Additional details will be available in the earnings press release scheduled for publication on or about August 14, 2020.
The Trust receives all of its royalties under two royalty agreements. The Mobil Agreement, which is the higher royalty rate agreement, covers gas sales from the western half of the Oldenburg concession. The OEG Agreement, which is the lower royalty rate agreement, covers gas sales from the entire Oldenburg concession. The factors determining the amount of gas royalties payable under the two agreements from the preceding calendar quarter are shown in the table below comparing the second calendar quarters of 2020 and 2019. We believe the reduction in gas sales and gas prices resulted from the decline in demand due to COVID-19 and the glut of gas in the European market. Further details will be included in the Trust's 10-Q available through the SEC or on the Trust's website, www.neort.com, on or about August 28, 2020.
| Mobil Agreement | 2nd Calendar Quarter Ended 6/30/2020 | 2nd Calendar Quarter Ended 6/30/2019 | Percentage Change | |
|---|---|---|---|---|
| Gas Sales (Bcf) 1 | 4.565 | 4.902 | - 6.87% | |
| Gas Prices2 (Ecents/Kwh)3 | 1.2326 | 1.8620 | -33.80% | |
| Average Exchange Rates4 | 1.1143 | 1.1202 | - 0.53% | |
| Gas Royalties | $718,425 | $1,174,573 | -38.84% | |
| OEG Agreement | ||||
| Gas Sales (Bcf) | 13.948 | 16.320 | -14.53% | |
| Gas Prices (Ecents/Kwh) | 1.2570 | 1.8988 | -33.80% | |
| Average Exchange Rates | 1.1141 | 1.1187 | - 0.41% | |
| Gas Royalties | $236,432 | $514,474 | -54.04% |
Footnotes:
- 1. Billion cubic feet
- 2. Gas prices derived from February-April period
- 3. Euro cents per kilowatt hour
- 4. Based on average Euro/dollar exchange rates of cumulative royalty transfers
The table below shows an estimate of the amount of royalties anticipated to be received in the fourth quarter of fiscal 2020 based on the actual amount of royalties that were payable to the Trust for the second calendar quarter of 2020. Amounts in dollars are based on the current exchange rate of 1.162301. Actual royalty income in dollars is valued based on exchange rates on the day funds are transferred. The August and September estimates below include a negative adjustment from the prior quarter of Euros 375,112. Distributions are based on royalty income received less incurred and anticipated expenses.
| Estimated Combined Royalties Anticipated in | Combined Royalties in Euros | Combined Royalties in Dollars | Dollar Royalties in Cents per Unit |
|---|---|---|---|
The cumulative 12-month distribution, which includes the August 2020 distribution and the three prior quarterly distributions, is $0.46 per unit. This 12-month cumulative distribution is 43.21%, or $0.35 per unit, lower than the prior 12-month distribution of $0.81 per unit. The Trust makes quarterly distributions to unit owners during the months of February, May, August and November.
Contact -- John R. Van Kirk, Managing Director, telephone: (732) 741-4008, email: jvankirk@neort.com. The Trust's press releases and other pertinent information are available on the Trust's website: www.neort.com.