Permian Basin Royalty Trust 8-K, filed Jul 21, 2023
Permian Basin Royalty Trust (PBT)
About this 8-K
Permian Basin Royalty Trust filed this 8-K on July 21, 2023.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 21, 2023
PERMIAN BASIN ROYALTY TRUST
(Exact name of Registrant as specified in its charter)
| Texas | 1-8033 | 75-6280532 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| Argent Trust Company 3838 Oak Lawn Ave Suite 1720 Dallas, Texas |
75219 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s Telephone Number, including area code: (855) 588-7839
Park Place
2911 Turtle Creek Blvd., Suite 850
Dallas, Texas 75219
(Former name or former address, if changed since last report)
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.):
| ☐ | Written communications 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 communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications 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 | PBT | 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 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
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 21, 2023, the Registrant issued a press release announcing its monthly cash distribution to unitholders of record on July 31, 2023. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
This Report on Form 8-K is being furnished pursuant to Item 2.02, Results of Operations and Financial Condition. The information furnished is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section and is not deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits | |
| 99.1 | Press Release dated July 21, 2023. | |
SIGNATURES
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 thereunto duly authorized.
| PERMIAN BASIN ROYALTY TRUST | ||||
| By: | ARGENT TRUST COMPANY, Trustee | |||
| By: | /s/ RON E. HOOPER | |||
| Ron E. Hooper | ||||
| SVP Royalty Trust Services | ||||
Date: July 21, 2023
Exhibit 99.1
Permian Basin Royalty Trust
PERMIAN BASIN ROYALTY TRUST
ANNOUNCES JULY CASH DISTRIBUTION
DALLAS, Texas, July 21, 2023 – Argent Trust Company, 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 $0.021749 per unit, payable on August 14, 2023, to unit holders of record on July 31, 2023.
This month’s distribution decreased from the previous month primarily due to a decrease in the price of both oil and gas offset by an increase in both oil and gas production on the Waddell Ranch Properties during the month of May.
WADDELL RANCH
In reporting May production of the Underlying Properties for this month’s press release, production for oil volumes was 235,077 (gross) and was priced at about $69.38 per bbl. Production for gas volumes (including gas liquids) was 839,630 Mcf (gross) and was priced at about $0.24 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 $15,742,030 (gross) for May. Lease Operating Expenses were $6,119,811 (gross) and Capital Expenditures (CAPEX) were $13,323,149 (gross) for May, netting to a negative Net Profit Interest (NPI) of $(3,700,930). This would put the trust’s proceeds of 75% as a negative $(2,775,697) (net) for the month of May. For the month of May, there was an increase of CAPEX relating specifically to the 2023 budgeted projects, although fracking costs remain constant from last month to this month, other capital budget items resulted in an increase to CAPEX. Given that if current oil and gas pricing continues, Waddell Ranch may or may not be able to continue to contribute to the distribution in the foreseeable future, to cover the ongoing CAPEX budget. The Waddell Ranch Properties NPI did not contribute to this month’s distribution.
First sales received for the month of May 2023 wells were as follows: (all net to the Trust), 3.0 new drill wells, including 1.9 horizontal wells, 3.8 recompleted wells. Waiting on completion, as of 5/31/2023, were 2.3 drill wells, including 1.5 horizontal wells and 4.1 recompletion wells. Also, 3.4 wells, plugged and abandoned, were completed.
Blackbeard has provided the projected 2023 capital expenditure budget for the Waddell Ranch Properties to be an estimated $96.8 million (net to the Trust) with a projection of about 30.75 new drill wells and 45 recompletions along with about 37.5 plug and abandoned wells. At this point in time, approximately 42% of that budget has been incurred.
TEXAS ROYALTY PROPERTIES
Production for the underlying properties at the Texas Royalties was 15,730 barrels of oil and 12,872 Mcf of gas. The production for the Trust’s allocated portion of the Texas Royalties was 13,926 barrels of oil and 11,412 Mcf of gas. The average price for oil was $73.01 per bbl and for gas was $5.79 which includes significant NGL pricing per Mcf. This would primarily reflect production and pricing for the month of May for oil and the month of April 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 $1,222,955. Deducted from these were taxes of $137,947 resulting in a Net Profit of $1,085,008 for the month of May. 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 $1,030,758 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 |
235,077 | 839,630 | 176,308 | 629,723 | * | $ | 69.38 | $ | 0.24 | ** | ||||||||||||||
| Texas Royalties |
15,730 | 12,872 | 13,926 | 11,412 | * | $ | 73.01 | $ | 5.79 | |||||||||||||||
| Prior Month |
||||||||||||||||||||||||
| Waddell Ranch |
221,817 | 722,843 | 166,363 | 542,132 | * | $ | 77.35 | $ | 0.41 | ** | ||||||||||||||
| Texas Royalties |
17,415 | 22,217 | 15,559 | 19,827 | * | $ | 75.10 | $ | 4.07 | |||||||||||||||
| * | 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 $25,445 resulting in a distribution of $1,013,732 to 46,608,796 units outstanding, or $0.021749 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 2022 Annual Report with Form 10-K and the January 1, 2023 Reserve Summary are posted 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, Argent Trust Company, Trustee, Toll Free – 1.855.588.7839