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): April 20, 2015
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 Southwest 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)) |
Item 2.02. Results of Operations and Financial Condition.
On April 20, 2015, the Registrant issued a press release announcing its monthly cash distribution to unitholders of record on April 30, 2015 and its 2015 reserve quantities. 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 April 20, 2015. |
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: | SOUTHWEST BANK, TRUSTEE FOR PERMIAN BASIN ROYALTY TRUST | |
| By: | /s/ RON HOOPER | |
| Ron Hooper | ||
| Senior Vice President | ||
Date: April 21, 2015
EXHIBIT INDEX
| Exhibit |
Description | |
| 99.1 | Press Release dated April 20, 2015. | |
Exhibit 99.1
Permian Basin Royalty Trust
PERMIAN BASIN ROYALTY TRUST
ANNOUNCES APRIL CASH DISTRIBUTION AND 2015 RESERVE QUANTITIES
DALLAS, Texas, April 20, 2015 – Permian Basin Royalty Trust (NYSE: PBT) (“Permian”) today declared a cash distribution to the holders of its units of beneficial interest of $0.023781 per unit, payable on May 14, 2015, to unit holders of record on April 30, 2015.
This month’s distribution increased from the previous month due to lower administrative expenses. Production and pricing from the Texas Royalty Properties was relatively flat month to month and because the Waddell Ranch Properties were still operating in Net Profit Interest deficit, there was no contribution to this month’s distribution from the Waddell Ranch Properties.
Production for the Trust’s allocated portion of the Waddell Ranch was a negative (27,954) barrels of oil and 5,537 Mcf of gas. These allocated volumes were significantly impacted by the capital expenditures and the reduced pricing of both oil and gas. The average price for oil was $45.23 per bbl and for gas was $4.02 per Mcf. For the Trust’s Texas Royalty Properties allocation, oil production was 26,022 barrels of oil and gas production was 31,457 Mcf. The average price for oil was $46.09 per bbl and for gas was $5.63 per Mcf.
This would primarily reflect production for the month of February for oil and the month of January for gas. 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.
| Underlying Properties | Net to Trust Sales | |||||||||||||||||||||||
| Volumes | Volumes | Average | Price | |||||||||||||||||||||
| Oil(bbls) | Gas(Mcf) | Oil(bbls) | Gas(Mcf) | Oil(per bbl) | Gas(perMcf) | |||||||||||||||||||
| Current Month |
||||||||||||||||||||||||
| Waddell Ranch |
70,659 | 423,108 | (27,954 | ) | 5,537 | $ | 45.23 | $ | 4.02 | ** | ||||||||||||||
| Texas Royalty Prop |
27,392 | 33,113 | 26,022 | 31,457 | $ | 46.09 | $ | 5.63 | ** | |||||||||||||||
| Prior Month |
||||||||||||||||||||||||
| Waddell Ranch |
68,940 | 374,293 | (35,530 | ) | (200,878 | ) | $ | 43.65 | $ | 2.61 | ** | |||||||||||||
| Texas Royalty Prop |
27,342 | 35,315 | 25,975 | 33,549 | $ | 47.42 | $ | 5.36 | ** | |||||||||||||||
| * | These volumes are the net to the trust, after allocation of expenses to Trust’s net profit interest. |
| ** | This pricing includes sales of gas liquid products. |
During February 2015, two of the 2015 workover wells were completed and producing. There was one drill well of the 2014 program that was completed into an additional pay zone and placed on production in the month of February. This completes the 2014 new drill program. Capital expenditures were approximately $757,558. The numbers provided reflect what was net to the Trust. Due to the allocation method of paying for capital expenditures and lease operating expenses, the Trust’s net volumes are adjusted in order to pay these expenditures.
ConocoPhillips has advised the Trustee of the 2015 capital expenditure budget which will total $48 million for the entire Waddell Ranch Project and $22.5 million net to the Trust. There will be 10 vertical wells, 2 horizontal wells, 10 recompletions, and various facilities projects. The workover/recompletions have started and will last through the year with the vertical/horizontal drilling beginning in June and the facilities work will occur throughout the year. The results of the 2013 and 2014 budget are discussed more fully in the Form 10-K filing.
Permian Basin Royalty Trust, as it does after the end of each year, had a year-end Reserve Report prepared in accordance with the Securities and Exchange Commission’s requirements. This report provides an evaluation of the estimated asset value as of December 31 of each year, which can be used to estimate the remaining life of the Trust.
The estimated net proved reserves, as of January 1, 2015, attributable to the Trust from the properties appraised are approximately 5.4 million barrels of oil and 13.2 billion cubic feet of gas with a future net value of approximately $ 538,738,000 with a discounted value of $302,282,000.
With the estimated quantities of this year’s reserve estimate of 5.4 million barrels of oil and 13.2 billion cubic feet of gas remaining, it could be estimated that the Trust still has a life span of 10 to 12 years. The report is an exhibit to the Trust’s Annual Report on Form 10-K that was filed on March 2, 2015 and is available to all unitholders at this time on the SEC website.
Permian’s cash distribution history, current and prior year financial reports and tax information booklets, a link to filings made with the Securities and Exchange Commission and more can be found on its website at http://www.pbt-permian.com/. The new toll free number customer service number for the trust is 1-855-588-7839.
. . .
| Contact: | Ron Hooper | |
| Senior Vice President | ||
| Southwest Bank, Trustee | ||
| Toll Free – 1.855.588.7839 |