SandRidge Permian Trust Announces Distribution of $0.625203 Per Unit
November 01 2012 - 4:15PM
Business Wire
SANDRIDGE PERMIAN TRUST (NYSE: PER) today announced a quarterly
distribution for the three-month period ended September 30, 2012
(which primarily relates to production attributable to the Trust’s
interests from June 1, 2012 through August 31, 2012) of $32.8
million, or $0.625203 per unit. The Trust makes distributions on a
quarterly basis approximately 60 days after the end of each
quarter. The distribution is expected to occur on or before
November 29, 2012 to holders of record as of the close of
business on November 14, 2012.
During the three-month production period ended August 31, 2012,
total sales volumes increased 9% over the previous three-month
period. The increased volume was primarily due to higher oil
production, which increased approximately 10% compared to the
previous period. Natural gas production increased 6%, while natural
gas liquids production decreased 2% period over period. The
additional production was partly offset by lower realized prices.
The realized oil price, including the impact of hedges and natural
gas liquids, was 2% lower compared to the previous period. Although
the realized gas price increased 32% over the previous period,
natural gas revenues made up less than one percent of total
revenues during the period. Overall, the higher production volumes
more than offset the lower realized oil price, resulting in a 7%
higher distribution per unit than the target.
The Trust owns royalty interests created from interests held by
SandRidge Energy, Inc. (“SandRidge”) and its subsidiaries in oil
and natural gas properties in the Central Basin Platform of the
Permian Basin in Andrews County, Texas and is entitled to receive
proceeds from the sale of production attributable to the royalty
interests. As described in the Trust’s filings with the Securities
and Exchange Commission (the “SEC”), the amount of the quarterly
distributions is expected to fluctuate from quarter to quarter,
depending on the proceeds received by the Trust as a result of
actual production volumes, oil and natural gas prices and the
amount and timing of the Trust’s administrative expenses, among
other factors. Although there is no assurance of any minimum
distribution in any quarterly period, during the subordination
period (as described in the Trust’s filings), holders of Common
Units will be entitled to receive an amount up to the
“Subordination Threshold” (which varies from quarter to quarter)
prior to any distribution being made for that quarter in respect of
the Subordinated Units, all of which are held by SandRidge. If the
amount available for distribution in any quarterly period is
sufficient to distribute an amount equal to the Subordination
Threshold to the holders of all units (including the Subordinated
Units), any additional balance is distributed to holders of all
units pro rata, up to the amount of the Incentive Threshold for the
quarter. Trust units are entitled to receive 50% of any cash
available for distribution in excess of the Incentive Threshold for
the quarter. The announced distribution exceeded the Subordination
Threshold, but not the Incentive Threshold, for the quarter.
Volumes, price and distributable income available to unitholders
for the period were (dollars in thousands, except per unit):
Sales Volumes Oil (MBbl) (1) 403 Gas
(MMcf) 110 Combined (MBoe) 421
Average Price Oil (per Bbl)
(1) $ 78.17 Gas (per Mcf) $ 2.22
Average Price - including
impact of derivative settlements and post-production expenses
Oil (per Bbl) (1) $ 88.33 Gas (per Mcf) $ 1.97
Revenues
Royalty income $ 31,731 Derivative settlements 4,093
Expenses 3,001
Distributable income available to
unitholders $ 32,823
Distributable income per unit
(52,500,000 units issued and outstanding) $ 0.625203 (1)
Includes natural gas liquids.
In addition to wells that were producing at the effective date
of the assignment of the royalty interests to the Trust, SandRidge,
pursuant to a development agreement with the Trust, is obligated to
drill, or cause to be drilled, the equivalent of 888 development
wells, determined by reference to SandRidge’s net revenue interest
in a well, in an area of mutual interest on or before
March 31, 2016.
During the three-month production period ended August 31, 2012,
four to five drilling rigs were utilized to drill development wells
for the Trust. Currently, three rigs are drilling Trust development
wells, and the present plan is to average three rigs during the
three-month production period ending November 30, 2012. To date,
equivalent development wells producing, or drilled and perforated
for completion, during production periods upon which distributions
are based are as follows:
As of
Equivalent ProducingDevelopment
Wells
Additional DrilledDevelopment
Wells*
Total DevelopmentWells
8/31/2011 85.2 20.7 105.9 11/30/2011 159.7 18.8 178.5 2/29/2012
219.3
16.2
235.5 5/31/2012 300.9 18.3 319.2 8/31/2012 381.5 20.2 401.7
*Equivalent development wells that are not producing at the ‘As
of’ date but have been drilled and perforated for completion.
Pursuant to IRC Section 1446, withholding tax on income
effectively connected to a United States trade or business
allocated to foreign partners should be made at the highest
marginal rate. Under Section 1441, withholding tax on fixed,
determinable, annual, periodic income from United States sources
allocated to foreign partners should be made at 30% of gross income
unless the rate is reduced by treaty. This is intended to be a
qualified notice to nominees and brokers as provided for under
Treasury Regulation Section 1.1446-4(b) by SandRidge Permian Trust,
and while specific relief is not specified for Section 1441 income,
this disclosure is intended to suffice. Nominees and brokers should
withhold 35% of the distribution made to foreign partners.
This press release contains statements that are “forward-looking
statements” within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended. All statements
contained in this press release, other than statements of
historical facts, are “forward-looking statements” for purposes of
these provisions. These forward-looking statements include the
amount and date of any anticipated distribution to unit holders.
The anticipated distribution is based, in part, on the amount of
cash received or expected to be received by the Trust from
SandRidge with respect to the relevant period. Any differences in
actual cash receipts by the Trust could affect this distributable
amount. Other important factors that could cause actual results to
differ materially include expenses of the Trust and reserves for
anticipated future expenses. Statements made in this press release
are qualified by the cautionary statements made in this press
release. Neither SandRidge nor the Trustee intends, and neither
assumes any obligation, to update any of the statements included in
this press release. An investment in Common Units issued by
SandRidge Permian Trust is subject to the risks described in the
Trust’s Annual Report on Form 10-K for the year ended
December 31, 2011, and all of its other filings with the SEC.
The Trust’s quarterly and other filed reports are or will be
available over the Internet at the SEC’s web site at http://www.sec.gov.
SandRidge Permian (NYSE:PER)
Historical Stock Chart
From May 2024 to Jun 2024
SandRidge Permian (NYSE:PER)
Historical Stock Chart
From Jun 2023 to Jun 2024