Posted: October 19, 2021 at 9:30 a.m. EDT|Update: 2 hours ago

DALLAS, Texas, October 19, 2021 / PRNewswire / – Simmons Bank, as Trustee of the Permian Basin Royalty Trust (NYSE: PBT) (“Permian”), today declared a cash distribution to holders of its beneficial interest units of $ 0.022354 per unit, payable on November 15, 2021, to unitholders of record on October 29, 2021.

This month’s distribution declined slightly from the previous month due to a slight drop in oil and gas prices for Texas royalty properties during August. Currently, only Texas Royalty Properties contribute to the monthly distribution.

Since the Waddell Ranch is currently in deficit for the foreseeable future, any increase or decrease in the distribution of income received will only reflect activity at the Texas Royalty Properties. The activity of the Waddell Ranch will be discussed with the following narrative until he contributes to the cast. This reflects the production month of August.

WADDELL RANCH
Reporting the August production of the underlying properties for this month’s press release, the production of oil volumes was 108,522 barrels (crude) and its price was around $ 66.66 per barrel. The production volumes of gas (including gas liquids) was 257,857 mcf (gross) and its price was approximately $ 3.44 per mcf, which now includes the value received from plant products and natural gas liquids. The net income from the underlying properties of the Waddell Ranch was $ 8,506,010 (gross) for August. Rental operating expenses were $ 2,320,259 (gross) and capital expenditures were $ 6,019,731 (gross) for August. This would place the Trust proceeds as a positive $ 124,515 (net) for the month of August, leaving a cumulative overcost deficit of $ 18.1 million (report).

There have been a lot of questions and requests for clarification of the 2021 Budget activity regarding the Waddell Ranch. The Trustee wishes to make it easier to understand the impact of this activity on the unitholders of the Trust. First, Blackbeard is the majority operator of Waddell Ranch. They own around 51% of the ownership while the other partners own the remaining 49% of the working interest. Of Blackbeard’s 51% interest, it is encumbered by the Trust’s 75% equity interest (NPI) of the Blackbeard property, resulting in the Trust’s net interest of approximately 38% in certain properties of the Waddell Ranch. So when the gross budget are numbers are discussed, they are talking about the whole project. However, for the sake of relevance to the unitholder’s understanding, only net figures for the Trust will be presented in the future.

The original 2021 budget for the Waddell Ranch, net for the Trust, was conservatively projected to be $ 32.5 million, with approximately 34.1 new boreholes, 9 reloads and 32.6 plugs and abandonments for the year. However, Blackbeard, after reviewing the various potentials of Waddell Ranch, increased the 2021 budget to $ 51 million for the year, with 32.25 boreholes and 52.5 re-completions on properties related to the Trust property, as well as the planned 32.6 plugged and abandoned wells. In their opinion, there was a lot of production potential behind the pipes and the reloading program would be very profitable. In October, approximately $ 39.4 million was spent with this new budget.

The number of producing wells resulting from activity on the Waddell Ranch properties (net to the Trust) through August reflects 32.3 reclamation wells in production and with first sales. The number of new boreholes in production (net to the Trust) during the month of August was 15.4 new boreholes in production and with first sales. In August, there were 16.9 new boreholes pending completion as well as 25.6 ongoing re-completions, all net for the Trust.

At the end of August, approximately $ 28.8 million income was generated by the 2020-2021 budgeted projects.

TEXAS ROYALTY PROPERTIES
Production from the underlying Texas Royalties properties was 17,941 million cubic feet of oil and 9,871 million cubic feet of gas. Production for the portion attributed to the Texas Royalty Trust was 15,927 barrels of oil and 8,757 barrels of gas. The average price of oil was $ 66.39 per barrel and for gas was $ 8.01 by Mpi. This would mainly reflect production and prices for the month of August for oil and the month of July for gas. These allocated volumes were affected by oil and gas prices. This production and pricing of the underlying properties generated revenue for Texas royalties from $ 1,270,201. From these were deducted the taxes of $ 130,650 resulting in a net profit of $ 1,139,551 for the month of August. With the trust’s net equity interest (NPI) of 95% of the underlying properties, this would translate into a net Texas Royalties contribution of $ 1,082,574 to this month’s distribution.

Underlying properties

Net sales to trustees

Volumes

Volumes

Mean

Price

Oil

(bbls)

Gas

(Mpi)

Oil

(bbls)

Gas

(Mpi)

Oil

(per barrel)

Gas

(by Mpi)

Current month

Waddell Ranch

108,522

257,857

81,392

193,393 *

$ 66.66

$ 3.44 **

Texan royalties

17 941

9 871

15 927

8,757 *

$ 66.39

$ 8.01 **

Last month

Waddell Ranch

102,735

249,359

77,051

187,019 *

$ 71.32

$ 3.45 **

Texan royalties

17 690

11 870

15,772

10,570 *

$ 71.11

$ 8.09 **

* These volumes are net to the trust, after charging expenses against the net interest of the trust, including any adjustments from the prior period.
** This price includes sales of liquid gas products.

General and administrative expenses deducted for the month were $ 41,079 resulting in a distribution of $ 1,041,927 to 46,608,796 units in circulation, or $ 0.022354 per unit.

World market conditions continue to affect the prices of domestic production. It is difficult to predict what effect these conditions will have on future distributions.

The 2020 annual report with form 10-K and the January 1, 2021 The summary of reservations is now available on the Permian website. Permian’s cash distribution history, current and prior year financial reports, tax information booklets, and a link to statements made to the Securities and Exchange Commission all can be found found on the Permian website at http://www.pbt-permian.com/. In addition, printed reports can be requested and mailed free of charge.

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SOURCE Permian Basin Royalty Trust

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