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): July 9, 2019
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.) |
BBVA USA, 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)) |
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 | SJT | NYSE |
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 7.01. | Regulation FD Disclosure. |
On July 9, 2019, the San Juan Basin Royalty Trust (the “Trust”) issued a press release, a copy of which is attached hereto as Exhibit 99.1, announcing that Hilcorp San Juan L.P. had provided the Trust with updates and comments to its current 2019 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 July 9, 2019. | |
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.
| BBVA USA, AS TRUSTEE FOR THE SAN JUAN BASIN ROYALTY TRUST (Registrant) | ||||||
| Date: July 9, 2019 | By: | /s/ Joshua R. Peterson | ||||
| Joshua R. Peterson | ||||||
| Senior Vice President and Trust Officer | ||||||
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Exhibit 99.1
San Juan Basin Royalty Trust
News Release
San Juan Basin Royalty Trust Announces Hilcorp’s Updates on Capital Expenditures Plan
FORT WORTH, Texas, July 9, 2019 – BBVA USA, as Trustee of the San Juan Basin Royalty Trust (the “Trust”) (NYSE:SJT), today reported that the operator of the Trust’s subject interests, Hilcorp San Juan L.P. (“Hilcorp”), has provided the Trust with updates and comments to its current 2019 Capital Expenditures Plan (“Capital Plan”).
More specifically, the Trust and its compliance auditors recently met with senior representatives from Hilcorp to discuss the status of the Capital Plan, production, and pending audit issues.
Hilcorp informed the Trust that oil and natural gas production from January 2019 through April 2019 was reduced due to severe winter conditions not seen in the San Juan Basin in over a decade. Such atypical conditions directly impacted production and physical access to well sites and facilities, maintenance, and transportation.
Despite low natural gas prices, Hilcorp believes the recompletions in the Capital Plan are sound economic projects. Hilcorp reported to the Trust that ten wells in the Capital Plan have been recompleted or are in progress as of the April 2019 reporting month, which corresponds to the June 2019 Trust distribution month. Well performance from the ten well recompletion package is exceeding Hilcorp’s initial expectations.
Hilcorp advised the Trust that it plans to drill two new wells in the second half of 2019 that will be funded from the Capital Plan. The first well is a horizontal well targeting the Fruitland Coal formation and the second well is a horizontal well targeting the Mancos formation. Capital spending on the Fruitland Coal well began in June 2019 and the well is expected to begin production in July 2019. Capital spending on the Mancos well is expected to begin in the third quarter of 2019, contingent on receiving a permit from the BLM, and the well is expected to begin production in the fourth quarter of 2019. Hilcorp informed the Trust that the Capital Plan for the Mancos well is higher than the Fruitland Coal well because the anticipated Mancos well will be drilled to a significantly deeper depth, have a longer horizontal lateral, and will be hydraulically fractured.
The Trust and its compliance auditors are also working with Hilcorp to schedule a field visit to the San Juan Basin to further understand Hilcorp’s recent operations, workflows, methodology, and current Capital Plan.
Contact: San Juan Basin Royalty Trust
BBVA USA, 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.