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): January 19, 2016
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 January 19, 2016, the Registrant issued a press release announcing its monthly cash distribution to unitholders of record on January 29, 2016. 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 January 19, 2016. |
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: January 20, 2016
EXHIBIT INDEX
| Exhibit |
Description | |
| 99.1 | Press Release dated January 19, 2016. | |
Exhibit 99.1
Permian Basin Royalty Trust
PERMIAN BASIN ROYALTY TRUST
ANNOUNCES JANUARY CASH DISTRIBUTION
DALLAS, Texas, January 19, 2016 – Permian Basin Royalty Trust (NYSE: PBT) (“Permian”) today declared a cash distribution to the holders of its units of beneficial interest of $0.014734 per unit, payable on February 12, 2016, to unit holders of record on January 29, 2016.
This month’s distribution decreased slightly from the previous month due to a decrease in the pricing of both oil and gas on the Texas Royalty Properties, whereas the Waddell Ranch Properties were in deficit this month and contributed nothing to this month’s distribution.
WADDELL RANCH
Production for the underlying properties at the Waddell Ranch was 70,992 barrels of oil and 434,834 Mcf of gas. The production for the Trust’s allocated portion of the Waddell Ranch was (13,648) barrels of oil and (88,394) Mcf of gas. The average price for oil was $40.47 per bbl and for gas was $1.99 per Mcf. This would primarily reflect production and pricing for the month of November for oil and the month of October 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 $3,735,248. Deducted from these would be the Lease Operating Expense (LOE) of $1,921,992, taxes of $368,263 and Capital Expenditures (CAPEX) of $1,281,881 totaling $3,572,136 resulting in a Net Profit of $163,112 for the month of December. 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 $122,334 to this month’s distribution. This amount along with the negative deficit carryover from prior periods brings deficit to be recouped to ($693,695). There is no distribution from the Waddell Ranch’s NPI for this month.
The 2015 ten workover well program has been completed and producing. The drill well program of ten vertical and two horizontal wells for the 2015 program was started in June 2015. During November, one well was completed and producing, with two other wells were being completed.
ConocoPhillips has advised the Trustee of the 2015 capital expenditure budget which should total $48 million for the entire Waddell Ranch Project and $22.5 million net to the Trust. There were ten vertical wells, two horizontal wells, ten recompletions, and various facilities projects. The workover/recompletions have completed along with the 12 vertical/horizontal drilling which began in June and to be completed in December, 2015. The facilities work occurred throughout the year.
ConocoPhillips has advised the Trustee of the 2016 capital expenditure budget which will total $11.6 million for the entire Waddell Ranch Project and $5.1 million net to the Trust. There will be no new drilled wells, eight recompletions, and some facilities projects. These workover/recompletions will occur during the year, along with the ongoing facilities work.
| Underlying Properties Volumes |
Net to Trust Sales Volumes |
Average | Price | |||||||||||||||||||||
| Oil(bbls) | Gas(Mcf) | Oil(bbls) | Gas(Mcf) | Oil(per bbl) | Gas(per Mcf) | |||||||||||||||||||
| Current Month |
||||||||||||||||||||||||
| Waddell Ranch |
70,992 | 434,834 | (13,648 | )* | (88,394 | )* | $ | 40.47 | $ | 1.99 | ** | |||||||||||||
| Texas Royalty Prop |
22,433 | 33,976 | 21,311 | * | 32,277 | * | $ | 40.95 | $ | 3.63 | ** | |||||||||||||
| Underlying Properties Volumes |
Net to Trust Sales Volumes |
Average | Price | |||||||||||||||||||||
| Oil(bbls) | Gas(Mcf) | Oil(bbls) | Gas(Mcf) | Oil(per bbl) | Gas(per Mcf) | |||||||||||||||||||
| Prior Month |
||||||||||||||||||||||||
| Waddell Ranch |
74,039 | 438,340 | (14,477 | )* | (82,611 | )* | $ | 45.63 | $ | 2.34 | ** | |||||||||||||
| Texas Royalty Prop |
26,462 | 33,031 | 25,139 | * | 31,379 | * | $ | 44.92 | $ | 4.09 | ** | |||||||||||||
| * | 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 22,433 barrels of oil and 33,976 Mcf of gas. The production for the Trust’s allocated portion of the Texas Royalties was 21,311 barrels of oil and 32,277 Mcf of gas. The average price for oil was $40.95 per bbl and for gas was $3.63 per Mcf. This would primarily reflect production and pricing for the month of November for oil and the month of October 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 $1,041,906. Deducted from these would be taxes of $201,638 resulting in a Net Profit of $840,267 for the month of December. 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 $798,254 to this month’s distribution.
General and Administrative Expenses deducted for the month were $111,490 resulting in a distribution of $686,774 to 46,608,796 units outstanding, or $.014734 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 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 |