Compass Bank, as Trustee of the San Juan Basin Royalty Trust (NYSE:SJT),
today reported it will not declare a monthly cash distribution to the
holders of its Units of beneficial interest for the month of May 2015.
Normally, a distribution would be made in May based principally upon
production during the month of March 2015. However, primarily due to low
natural gas pricing and higher capital costs during the month of March,
the cash attributable to the Royalties is $612,141. Those funds will be
utilized to pay Trust administrative expenses of $164,889 and to
increase cash reserves. No cash distributions will be made by the Trust
until future net proceeds are sufficient to pay then-current Trust
liabilities and to replenish and maintain cash reserves in the amount of
at least $500,000. No assurances can be given as to the timing or amount
of any such future distributions.
Gas production for the properties from which the royalty was carved (the
“Underlying Properties”) totaled approximately 2,485,829 Mcf (2,732,418
MMBtu). Dividing revenues by production volume yielded an average gas
price for March 2015 of $2.44 per Mcf ($2.22 per MMBtu) as compared to
$2.47 per Mcf ($2.25 per MMBtu) for February 2015.
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 $2,120,135. Lease
operating expenses were $2,655,320 and taxes were $672,617.
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