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): November 18, 2019

 

 

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.)

Royalty Trust Management

Simmons Bank

2911 Turtle Creek Boulevard

Suite 850

Dallas, Texas

  75219
(Address of principal executive offices)   (Zip Code)

Registrant’s Telephone Number, including area code: (855) 588-7839

Not Applicable

(Former name, former address and former fiscal year, 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 November 18, 2019, the Registrant issued a press release announcing its monthly cash distribution to unitholders of record on November 29, 2019. 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 November 18, 2019.


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:   SIMMONS BANK, TRUSTEE FOR
  PERMIAN BASIN ROYALTY TRUST
By:  

/s/ RON E. HOOPER

  Ron E. Hooper
  Senior Vice President

Date: November 18, 2019

EX-99.1

Exhibit 99.1

Permian Basin Royalty Trust

PERMIAN BASIN ROYALTY TRUST

ANNOUNCES NOVEMBER CASH DISTRIBUTION

DALLAS, Texas, November 18, 2019 – 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 $0.038987 per unit, payable on December 13, 2019, to unit holders of record on November 29, 2019.

This month’s distribution increased from the previous month due primarily to an increase of both oil and gas production. This reflects the production month of September. Pricing for both oil and gas increased on the Waddell Ranch. Capital Expenditures declined to reflect less activity, with most of the completion of drilling of the additional wells on the Waddell Ranch Properties in the previous months. Lease Operating Expenses (LOE) for the Waddell Ranch properties decreased substantially this month to reflect an adjustment to the electricity rates incurred last month on the Waddell Ranch for the year. The Texas Royalty Properties saw a decrease in the posting of production of oil and gas, primarily due to shorter production month of September. This was offset by a slight increase in pricing for oil and gas for the Texas Royalty Properties.

WADDELL RANCH

Production for the underlying properties at the Waddell Ranch was 51,915 barrels of oil and 287,050 Mcf of gas. The production for the Trust’s allocated portion of the Waddell Ranch was 13,836 barrels of oil and 74,335 Mcf of gas. The average price for oil was $54.75 per bbl and for gas was $1.75 per Mcf. This would primarily reflect production and pricing for the month of September for oil and the month of August for gas. These allocated volumes were significantly impacted by the pricing of both oil and gas.

This production and pricing for the Underlying Properties resulted in revenues for the Waddell Ranch Properties of $3,345,452. Deducted from these would be the Lease Operating Expense (LOE) of $1,880,770, taxes of $257,106 and Capital Expenditures (CAPEX) of $80,965 totaling $2,218,841 resulting in a Net Profit of $1,126,611 for the month of October. With the Trust’s Net Profit Interest (NPI) of 75% of the underlying properties, this would result in a net contribution by the Waddell Ranch Properties of $844,958 to this month’s distribution.

ConocoPhillips has advised the Trust of the 2019 budget for the Waddell Ranch reflecting 2 new drill wells into the Wolfcamp formation at an estimated $2.5 million, gross, ($1.2 million net to the Trust), including $1.7 million, gross, ($.8 million net to the trust), of 2018 carryover budget, anticipated to be completed in early 2019. Also, base well work of $1.6 million, gross, ($0.7 million net to the trust) and facilities work of $4.2 million, gross, ($1.8 million net to the Trust) bringing a total of $6.6 million, gross, ($2.97 million to the trust) of drilling and projects for 2019. There are no recompletions planned for the year of 2019.

 

     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

     51,915        287,050        13,836        74,335   $ 54.75      $ 1.75 ** 

Texas Royalties

     21,393        15,433        18,229        13,137   $ 53.84      $ 3.98 ** 

Prior Month

                

Waddell Ranch

     51,758        252,217        4,989        26,032   $ 51.99      $ 1.08 ** 

Texas Royalties

     22,746        21,673        19,520        18,583   $ 53.16      $ 3.24 ** 

 

*

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.

TEXAS ROYALTY PROPERTIES

Production for the underlying properties at the Texas Royalties was 21,393 barrels of oil and 15,433 Mcf of gas. The production for the Trust’s allocated portion of the Texas Royalties was 18,229 barrels of oil and 13,137 of gas. The average price for oil was $53.84 per bbl and for gas was $3.98 per Mcf. This would primarily reflect production and pricing for the month of September for oil and the month of August 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 $1,213,207. Deducted from these were taxes of $169,342 resulting in a Net Profit of $1,043,864 for the month of October. 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 $991,671 to this month’s distribution.

General and Administrative Expenses deducted for the month were $20,988 resulting in a distribution of $1,817,166 to 46,608,796 units outstanding, or $0.038987 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.

Permian’s cash distribution history, current and prior year financial reports, including a summary of reserves as of 1/1/2019, tax information booklets, and a link to filings made with the Securities and Exchange Commission, all can be found on its website at http://www.pbt-permian.com/.

*            *             *

 

  Contact:

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