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): February 4, 2022
SABINE ROYALTY TRUST
(Exact name of Registrant as specified in its charter)
| Texas | 1-8424 | 75-6297143 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) | ||
| Simmons Bank Park Place 2911 Turtle Creek Blvd. 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 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.):
| ☐ | 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 of Beneficial Interest | SBR | New York Stock Exchange |
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 February 4, 2022, the Registrant issued a press release announcing its monthly cash distribution to unitholders of record on February 15, 2022. A copy of 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 |
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.
| SABINE ROYALTY TRUST | ||
| By: SIMMONS BANK, TRUSTEE | ||
| By: | /s/ RON E. HOOPER | |
| Ron E. Hooper | ||
| SVP Royalty Trust Management | ||
Date: February 4, 2022
Exhibit 99.1
Sabine Royalty Trust
News Release
SABINE ROYALTY TRUST ANNOUNCES
MONTHLY CASH DISTRIBUTION FOR FEBRUARY 2022
Dallas, Texas, February 4, 2022 – Simmons Bank, as Trustee of the Sabine Royalty Trust (NYSE: SBR), today declared a cash distribution to the holders of its units of beneficial interest of $0.374350 per unit, payable on February 28, 2022, to unit holders of record on February 15, 2022. Sabine’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.sbr-sabine.com/. Additionally, printed reports can be requested and are mailed free of charge.
This distribution reflects primarily the oil production for November 2021 and the gas production for October 2021. Preliminary production volumes are approximately 36,010 barrels of oil and 682,527 Mcf of gas. Preliminary prices are approximately $72.32 per barrel of oil and $5.29 per Mcf of gas.
This month’s distribution is significantly lower than previous month’s due to the extraordinary receipt in the month of December of $4.1 million from several new producing horizontal wells in Panola County, Texas.
The production from the new gas wells has contributed approximately $1.6 million reflecting October production. They were averaging about 900 Mcf per day per well during October totaling over 221,000 Mcf during this time frame with an average pricing of $5.59 per Mcf. As more regular monthly receipts are made in the months to come, additional information will be made available.
The table below compares this month’s production and prices to the previous month’s:
| Net to Trust Sales | ||||||||||||||||
| Volumes | Average Price | |||||||||||||||
| Oil (bbls) | Gas (Mcf) | Oil (per bbl) |
Gas (per Mcf) |
|||||||||||||
| Current Month |
36,010 | 682,527 | $ | 72.32 | $ | 5.29 | ||||||||||
| Prior Month |
71,882 | 2,249,986 | $ | 78.95 | $ | 4.09 | ||||||||||
Revenues are only distributed after they are received, verified and posted. Most energy companies normally issue payment of royalties on or about the 25th of every month, and depending on mail delivery, a varying amount of royalties are not received until after the revenue posting on the last business day of the month. The revenues received after that date will be posted within 30 days of receipt.
During the month of January, the respective shelter-at-home/work-from-home orders across the spectrum of the industry has significantly affected the posting of revenues for the Trust, until the following month of February. As adjustments are made accordingly, the functions of the Trust are still being performed, although on a delayed basis. We will continue to strive to make the operations of the Trust and its providers, as fluid as possible.
Due to the timing of the end of the month of January, approximately $1,888,043 of revenue received will be posted in the following month of February in addition to normal receipts during February. Since the close of business in January and prior to this press release, $874,000 in revenue has been received.
Approximately $60,000 for 2021 Ad Valorem taxes was deducted from this month’s distribution as compared to $45,000 this time last year. These payments are normal expenditures at this time of year.
The 2021 tax information packets are expected to begin mailing directly to unitholders in early March 2022. A copy of Sabine’s 2021 tax information booklet will be posted on Sabine’s website by March 1, 2022. In addition to the tax booklet the Sabine website will also offer two simple calculators for computing the income and expense amounts and the cost depletion. The calculators are currently expected to be updated with the 2021 tax information by February 28, 2022.
The 2020 Annual Report with Form 10-K and the January 1, 2021 Reserve Summary are now available on the Sabine website at http://www.sbr-sabine.com/.
* * *
| Contact: | Ron Hooper - SVP, Royalty Trust Services | |
| Simmons Bank | ||
| Toll Free (855) 588-7839 |