Distributable income decreased to $135,538 for the three months ended September 30,
2019 from $222,009 realized for the comparable period in 2018, due to lower pricing for oil and natural gas and the production of oil and due to an increase in legal and accounting expenses due to the timing relating to the closing of the annual
financial statements which incurred in the first quarter of fiscal year 2020 compared to the second quarter of fiscal 2019.
Income from
oil royalties, excluding the Trusts interest in Tidelands, for the three months ended September 30, 2019 decreased to $170,416 from $224,300 realized for the comparable period in 2018. The volume of oil sold in the three months ended
September 30, 2019 decreased to 2,700 bbls from 3,343 bbls realized for the comparable period in 2018, and the average price realized for oil decreased to $63.13 per bbl for the three months ended September 30, 2019 from $67.10 per bbl
realized for the comparable period in 2018.
Income from natural gas royalties (net of expenses), excluding the Trusts interest in
Tidelands, for the three months ended September 30, 2019 increased to $27,832 from $14,434 for the comparable period in 2018. The volume of natural gas sold in the three months ended September 30, 2019 increased to 10,542 mcf from 4,193
mcf realized for the comparable period in 2018, and the average price realized for natural gas (net of expenses) decreased to $2.64 per mcf for the three months ended September 30, 2019 from $3.37 per mcf realized for the comparable period in
2018.
We did not receive any income from distributions from Tidelands in each of the three months ended September 30, 2019 and 2018.
We understand that Tidelands does not currently have sufficient production in economic quantities to generate any revenue to be distributed to its unit holders. Accordingly, we do not expect to receive any income from distributions from Tidelands in
future quarters.
The following table presents the quantities of oil and natural gas sold and the average price realized for the three
months ended September 30, 2019, and those realized for the comparable period in 2018, excluding the Trusts interest in Tidelands.
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Three Months Ended September 30,
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2019
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2018
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(unaudited)
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Oil
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Bbls sold
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2,700
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3,343
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Average price
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$
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63.13
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$
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67.10
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Natural gas
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Mcf sold
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10,542
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4,193
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Average price, net of expenses
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$
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2.64
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$
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3.37
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General and administrative expenses increased to $68,154 for the three months ended September 30, 2019
from $21,224 for the comparable period of 2018, primarily due to an increase in legal and accounting expenses due to timing of expenses relating to the closing of the annual financial statements which incurred in the first quarter of the fiscal year
2020 compared to the second quarter of fiscal 2019.
Forward-Looking Statements
The statements discussed in this Quarterly Report on Form 10-Q regarding Marines future financial
performance and results, and other statements that are not historical facts, are forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Exchange Act. This report uses the words
anticipate, believe, budget, continue, estimate, expect, intend, may, plan, or other similar words to identify forward-looking statements.
You should read statements that contain these words carefully because they discuss future expectations, contain projections of Marines financial condition, and/or state other forward-looking information. Actual results may differ
from expected results because of: reductions in price or demand for oil and natural gas, which might then lead to decreased production or impair Marines ability to make distributions; reductions in production due to the depletion of existing
wells or disruptions in service, which may be caused by storm damage to production facilities, blowouts or other production accidents, or geological changes such as cratering of productive formations; changes in regulations; general economic
conditions; actions and policies of petroleum-producing nations; other changes in domestic and international energy markets; the resignation of the Trustee; and the expiration, termination or release of leases subject to Marines interests.
Additional risks are set forth in Marines Annual Report on Form 10-K for the fiscal year ended June 30, 2019. Events may occur in the future that Marine is unable to accurately predict or over which
it has no control. If one or more of these uncertainties materialize, or if underlying assumptions prove incorrect, actual outcomes may vary materially from those forward-looking statements included in this Quarterly Report on Form 10-Q. Except as required by applicable securities laws, Marine does not undertake any obligation to update or revise any forward-looking statements.
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