UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 19, 2018
San Juan Basin Royalty Trust
(Exact name of registrant as specified in its charter)
| Texas | 1-8032 | 75-6279898 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
Compass Bank, Trust Department
300 W. 7th Street, Suite B
Fort Worth, Texas 76102
(Address of principal executive offices, including 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 (see General Instruction A.2. below):
| ☐ | 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)) |
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 19, 2018, the San Juan Basin Royalty Trust (the “Trust”) issued a press release, a copy of which is attached hereto as Exhibit 99.1, announcing a monthly cash distribution to the holders of its units of beneficial interest of $1,742,480.11 or $0.037385 per unit, based primarily upon production during the month of September 2018, subject to certain adjustments by the operator of the Trust’s subject interests, Hilcorp San Juan L.P. (“Hilcorp”) for prior months. The distribution is payable December 14, 2018, to unit holders of record as of November 30, 2018.
| Item 7.01. | Regulation FD Disclosure. |
Also in the November 19, 2018 press release attached hereto as Exhibit 99.1, the Trust further announced that Hilcorp provided the Trust with its Second Revised 2018 Capital Expenditures Plan.
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.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
The following exhibits are filed in accordance with the provisions of Item 601 of Regulation S-K:
| Exhibit No. |
Description | |
| 99.1 | Press Release, dated November 19, 2018. | |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.
| COMPASS BANK, AS TRUSTEE FOR THE SAN JUAN BASIN ROYALTY TRUST (Registrant) | ||||||
| Date: November 19, 2018 | By: | /s/ Joshua R. Peterson | ||||
| Joshua R. Peterson | ||||||
| Senior Vice President and Trust Officer | ||||||
4
Exhibit 99.1
San Juan Basin Royalty Trust
News Release
San Juan Basin Royalty Trust Declares November Cash Distribution and Announces Hilcorp’s 2nd Revised 2018 Capital Expenditures Plan
FORT WORTH, Texas, November 19, 2018 – Compass Bank, as Trustee of the San Juan Basin Royalty Trust (the “Trust”) (NYSE:SJT), today declared a monthly cash distribution to the holders of its Units of beneficial interest (the “Unit Holders”) of $1,742,480.11 or $0.037385 per Unit, based primarily upon production during the month of September 2018, subject to certain adjustments by the operator of the Trust’s subject interests, Hilcorp San Juan L.P. (“Hilcorp”), for prior months. The distribution is payable December 14, 2018, to Unit Holders of record as of November 30, 2018.
Based upon information provided to the Trust by Hilcorp, gas production for the subject interests totaled 2,444,542 Mcf (2,716,158 MMBtu) for September 2018, as compared to 2,530,624 Mcf (2,811,804 MMBtu) for August 2018. Dividing revenues by production volume yielded an average gas price for September 2018 of $2.21 per Mcf ($1.99 per MMBtu), as compared to an average gas price for August 2018 of $2.25 per Mcf ($2.02 per MMBtu).
Hilcorp has advised the Trust that for the reporting month of September 2018, oil and gas production was accrued based on actual production volumes, including an estimate of $169,000 for non-operated revenue. For the month ended September 2018, Hilcorp reported to the Trust capital costs of $710,196, lease operating expenses and property taxes of $1,858,436 and severance taxes of $778,104.
Second Revised 2018 Capital Expenditures Plan
Hilcorp has further updated its capital expenditures plan that the Trust disclosed to its Unit Holders on September 20, 2018, and has provided the Trust with its Second Revised 2018 Capital Expenditures Plan (“Second Revised Plan”). Hilcorp’s Second Revised Plan estimates total 2018 capital expenditures for the Trust’s subject interests to be $2,305,000, which includes approximately $2,000,000 for 15 well recompletions and $305,000 for five facility projects. Hilcorp has advised the Trust that the actual capital costs may vary from these estimates. Hilcorp further has informed the Trust that nine wells have been recompleted and four facility projects have been completed, while six well recompletions and one facility project are in progress. Total capital costs charged to the Trust by Hilcorp for the Trust’s subject interests for the year-to-date through the September 2018 reporting period were $1,602,712. Based on the Second Revised Plan, Hilcorp has advised the Trust that it anticipates charging approximately an aggregate of $700,000 in capital costs to the Trust for the combined October, November and December reporting period.
Contact: San Juan Basin Royalty Trust
Compass Bank, Trustee
300 West Seventh St., Suite B, Fort Worth, Texas 76102
website: www.sjbrt.com e-mail: sjt.us@bbva.com
Joshua R. Peterson, Senior Vice President & Trust Officer
Kaye Wilke, Investor Relations, toll-free: (866) 809-4553
Except for historical information contained in this news release, the statements in this news release are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements generally are accompanied by words such as “estimates,” “anticipates,” “could,” “plan,” or other words that convey the uncertainty of future events or outcomes. Forward-looking statements and the business prospects of San Juan Basin Royalty Trust are subject to a number of risks and uncertainties that may cause actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, certain information provided to the Trust by Hilcorp, volatility of oil and gas prices, governmental regulation or action, litigation, and uncertainties about estimates of reserves. These and other risks are described in the Trust’s reports and other filings with the Securities and Exchange Commission.