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): October 21, 2014
San Juan Basin Royalty Trust
(Exact name of registrant as specified in the Amended and Restated San Juan Basin Royalty Trust Indenture)
| Texas |
1-8032 |
75-6279898 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
| Compass Bank, Trust Department 300 W. 7th Street, Suite B Fort Worth, Texas |
76102 | |
| (Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (866) 809-4553
N/A
(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:
| ¨ | 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 October 21, 2014, the San Juan Basin Royalty Trust (the “Trust”) issued a press release, a copy of which is attached hereto as Exhibit 99.1, announcing, among other things, a monthly cash distribution to the holders of its units of beneficial interest of $4,717,844.17, or $0.101222 per unit, based principally upon production during the month of August 2014.
Item 8.01 Other Events.
In February 2014 Burlington informed the Trustee it had discovered a failure by Burlington to properly allocate approximately $4.3 million of severance taxes to the calculation of the Royalty during a period commencing in 2007 until the allocation was corrected in 2012, which resulted in what it characterized as an overpayment to the Trust in the amount of approximately $3.25 million. Burlington proposed and has begun to recoup the overpayment in installments of $361,215 commencing in March 2014 and continuing in equal installments through November 2014. Burlington has elected not to charge interest on the overpayment, although it has reserved the right to do so. The Trust and its advisors are analyzing the facts and circumstances and will continue communication with Burlington on this claim.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| 99.1 | Press release, dated October 21, 2014. |
In accordance with general instruction B.2 to Form 8-K, the information in this Form 8-K shall be deemed “furnished” and not “filed” with the Securities and Exchange Commission for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.
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 hereunto duly authorized.
| COMPASS BANK, AS TRUSTEE FOR THE SAN JUAN BASIN ROYALTY TRUST (Registrant) | ||
| By: |
/s/ Lee Ann Anderson | |
| Lee Ann Anderson | ||
| Vice President and Senior Trust Officer | ||
Date: October 21, 2014
(The Trust has no directors or executive officers.)
Exhibit 99.1
San Juan Basin Royalty Trust
News Release
Compass Bank, Trustee
300 West Seventh Street, Suite B
Fort Worth, Texas 76102
San Juan Basin Royalty Trust
Declares Monthly Cash Distribution
FORT WORTH, Texas, October 21, 2014 – Compass Bank, as Trustee of the San Juan Basin Royalty Trust (NYSE:SJT), today declared a monthly cash distribution to the holders of its Units of beneficial interest of $4,717,844.17 or $0.101222 per Unit, based principally upon production during the month of August 2014. The distribution is payable November 17, 2014, to Unit Holders of record as of October 31, 2014.
Gas production for the properties from which the royalty was carved (the “Underlying Properties”) totaled approximately 2,679,820 Mcf (3,009,577 MMBtu). Dividing revenues by production volume yielded an average gas price for August 2014 of $4.02 per Mcf ($3.58 per MMBtu) as compared to $4.51 per Mcf ($4.03 per MMBtu) for July 2014.
In February 2014 Burlington informed the Trustee it had discovered a failure by Burlington to properly allocate approximately $4.3 million of severance taxes to the calculation of the Royalty during a period commencing in 2007 until the allocation was corrected in 2012, which resulted in what it characterized as an overpayment to the Trust in the amount of approximately $3.25 million. Burlington proposed and has begun to recoup the overpayment in installments of $361,215 commencing in March 2014 and continuing in equal installments through November 2014. Burlington has elected not to charge interest on the overpayment, although it has reserved the right to do so. The Trust and its advisors are analyzing the facts and circumstances and will continue communication with Burlington on this claim.
The average monthly gas price Burlington reports to the Trust is a calculated price. It is determined by dividing gross monthly revenue by production volume, therefore, it does not represent an average of actual sales prices. The average gas price may vary from the posted index price for the San Juan Basin. The index price is a gross sales price, and the revenues used in the calculation of average gas prices are net of transportation, processing and gathering costs. Furthermore, the distribution to the Trust in any given month may include significant volume adjustments for sales in prior months that reflect pricing for those prior months. Capital costs for the month were $368,993. Lease operating expenses were $2,647,508 and taxes were $1,628,415.
| Contact: |
San Juan Basin Royalty Trust | |
| Compass Bank | ||
| Lee Ann Anderson, Vice President & Senior Trust Officer | ||
| Kaye Wilke, Investor Relations, toll-free: (866) 809-4553 | ||
| Fax: (817) 735-0936 | ||
| Website: www.sjbrt.com | ||
| e-mail: sjt.us@bbva.com |