Pacific Coast Oil Trust Announces December Cash Distribution
November 30 2018 - 4:15PM
Business Wire
PACIFIC COAST OIL TRUST (NYSE:ROYT) (the “Trust”), a royalty
trust formed by Pacific Coast Energy Company LP (“PCEC”), announced
today a cash distribution to the holders of its units of beneficial
interest of $0.04097 per unit, payable on December 24, 2018 to
unitholders of record on December 10, 2018. The Trust’s
distribution calculation relates to net profits and overriding
royalties generated during October 2018 as provided in the
conveyance of net profits and overriding royalty interest. All
information in this press release has been provided to the Trustee
by PCEC.
The current month’s calculation for the Developed Properties
resulted in $2.0 million of revenues less direct operating expenses
and development costs. The current month’s revenues were $5.1
million, lease operating expenses including property taxes were
$2.6 million and capital expenditures were $0.4 million. Average
realized prices for the Developed Properties were $75.08 per Boe in
October, as compared to $72.86 per Boe in September. Net profits
for the month of October for the Developed Properties were $1.6
million.
The current month’s calculation included approximately $89,000
for the 7.5% overriding royalty interest on the Remaining
Properties from Orcutt Diatomite and Orcutt Field. Average realized
prices for the Remaining Properties were $71.79 per Boe in October,
as compared to $69.54 per Boe in September. The cumulative net
profits deficit for the Remaining Properties, including the 7.5%
overriding royalty interest payments, decreased by approximately
$16,000 and now totals $1.5 million as of October 2018.
The net cash flow available for distribution to the holders of
units of beneficial interest is approximately $1.6 million. The
proceeds expected to be received by the Trust in December of $1.7
million consist of $1.6 million in income from the Developed
Properties and approximately $89,000 in income from the 7.5%
overriding royalty interest on the Remaining Properties. The
proceeds to be received by the Trust will be partially offset by
$91,000 for the monthly operating and services fee payable to PCEC
and approximately $45,000 in Trust general and administrative
expenses, resulting in the net cash flow available for distribution
of approximately $1.6 million.
The Trustee periodically engages an independent oil and gas
consulting firm to perform a detailed review of the computation of
the amounts paid to the Trust. The consulting firm has concluded
its review of payments relating to the Trust Year 2016, the Trustee
and PCEC have concluded their reviews and discussions of the
findings, and the resulting adjustments have been included in the
current month’s calculation. The adjustments increased the amount
payable to the Trust from the Developed Properties by approximately
$54,000 and decreased the cumulative net profits deficit from the
Remaining Properties by approximately $2,000.
Sales Volumes and Prices
The following table displays PCEC’s underlying sales volumes and
average prices for the month of October 2018:
Underlying Properties Sales Volumes
Average Price (Boe) (Boe/day) (per Boe) Developed
Properties (a) 67,860 2,189 $75.08 Remaining Properties (b) 17,315
559 $71.79 (a) Crude oil sales represented 98% of sales
volumes (b) Crude oil sales represented 100% of sales volumes
2018 Operating and Financial Sensitivity Analysis
Year-to-date 2018 (through the October 2018 production month)
Developed Properties production has been approximately 270 boe/d
under the 2018 guidance range provided in February 2018, primarily
due to lower-than-expected performance from the Los Angeles Basin.
West Pico production has been approximately 150 boe/d below
expected levels due to gas export restrictions and significant
shut-in wells requiring workovers (as disclosed in the Trust’s
previous filings with the Securities and Exchange Commission (the
“SEC”)). West Pico production has improved since October and is
expected to approach the levels generally experienced prior to the
gas export shutdown. East Coyote and Sawtelle production has been
approximately 45 boe/d below expected levels due to the temporary
shutdown of wells from sanding and well failures as well as
injection constraints at both fields (as disclosed in the Trust’s
previous filings with the SEC). The remaining shortfall of
approximately 75 boe/d is due to lower-than-expected production
from Orcutt Diatomite cyclic steam operations, partially offset by
higher-than-expected production from Orcutt Conventional. PCEC
expects to provide guidance for 2019 early next year.
Overview of Trust Structure
Pacific Coast Oil Trust is a Delaware statutory trust formed by
PCEC to own interests in certain oil and gas properties in the
Santa Maria Basin and the Los Angeles Basin in California (the
“Underlying Properties”). The Underlying Properties and the Trust’s
net profits and royalty interests are described in the Trust’s
filings with the SEC. As described in the Trust’s filings with the
SEC, the amount of any periodic distributions is expected to
fluctuate, depending on the proceeds received by the Trust as a
result of actual production volumes, oil and gas prices,
development expenses, and the amount and timing of the Trust’s
administrative expenses, among other factors. For additional
information on the Trust, please visit
www.pacificcoastoiltrust.com.
Cautionary Statement Regarding
Forward-Looking Information
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 PCEC’s estimates regarding
its 2018 capital program and the amount and date of any anticipated
distribution to unitholders. Any anticipated distribution is based,
in part, on the amount of cash received or expected to be received
by the Trust from PCEC with respect to the relevant period. Any
differences in actual cash receipts by the Trust could affect this
distributable amount. The amount of such cash received or expected
to be received by the Trust (and its ability to pay distributions)
has been and will be significantly and negatively affected by
prevailing low commodity prices, which have declined significantly,
could decline further and could remain low for an extended period
of time. 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 PCEC nor the Trustee intends, and neither assumes
any obligation, to update any of the statements included in this
press release. An investment in units issued by Pacific Coast Oil
Trust is subject to the risks described in the Trust's Annual
Report on Form 10-K for the year ended December 31, 2017 filed with
the SEC on March 9, 2018, and if applicable, the Trust’s subsequent
Quarterly Reports on Form 10-Q. The Trust's Annual Reports on Form
10-K and Quarterly Reports on Form 10-Q are available over the
Internet at the SEC's website at http://www.sec.gov.
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version on businesswire.com: https://www.businesswire.com/news/home/20181130005507/en/
Pacific Coast Oil TrustThe Bank of New York Mellon Trust
Company, N.A., as TrusteeSarah Newell1(512) 236-6555
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