Chesapeake Granite Wash Trust (NYSE:CHKR) (the “Trust”)
announced today that its distribution for the period from July 1,
2011 through August 31, 2011 will be $0.58 per unit, which will be
paid on December 28, 2011 to unitholders of record at the close of
business on December 15, 2011.
During the two-month period ended August 31, 2011, sales volumes
and realized prices were higher than estimated in the Prospectus
dated November 10, 2011 relating to the initial public offering of
the common units of the Trust, resulting in an approximate 7%
higher distribution per unit over the target distribution of $0.54
per unit listed in the Prospectus. The following table provides
sales volumes, realized prices and revenue attributable to the
Trust’s royalty interests, expenses of the Trust and distributable
income available to unitholders for the period from July 1, 2011 to
August 31, 2011.
Sales volumes Oil (mbbl) 133 Natural gas liquids (mbbl) 225
Natural gas (mmcf) 2,172 Total oil equivalent volumes (mboe) 720
Average price received per production unit(1) Oil $ 88.26
Natural gas liquids $ 46.65 Natural gas $ 3.26 Revenue less
production taxes (in thousands) $ 28,428 Expenses (in thousands) $
1,256 Distributable income available to unitholders (in thousands)
$ 27,172 Distributable income per unit (46,750,000 units issued and
outstanding) $ 0.58
(1) Includes the effect of certain marketing, gathering and
transportation deductions.
Due to the timing of the payment of production proceeds to the
Trust, future quarterly distributions will generally include
royalties attributable to sales of oil, natural gas liquids and
natural gas for three months, including the first two months of the
quarter just ended and the last month of the prior quarter.
The Trust was formed by Chesapeake Energy Corporation (NYSE:CHK)
("Chesapeake") in June 2011 and owns royalty interests in certain
oil and natural gas properties in the Colony Granite Wash play in
Washita County, Oklahoma. The Trust is entitled to receive proceeds
from the sale of production attributed to the royalty interests. As
described in the Prospectus, the amount of Trust revenues and the
quarterly distributions to Trust unitholders will fluctuate from
quarter to quarter, depending on the timing of initial sales from
the development wells drilled by Chesapeake in which the Trust
receives an interest, the sales volume of oil, natural gas liquids
and natural gas attributable to the Trust’s royalty interests and
the prices received for such sales, amounts realized and paid under
the Trust’s hedging arrangements and the amount of the Trust's
administrative expenses, among other factors.
Conference Call Information
Chesapeake will host a conference call to discuss the results on
Tuesday, December 6, 2011 at 9:00 am EST. The telephone number to
access the conference call is 913-312-9308 or toll-free
888-204-4317. The passcode for the call is 4176937.
We encourage those who would like to participate in the call to
place calls between 8:50 and 9:00 am EST.
For those unable to participate in the conference call, a replay
will be available for audio playback at 1:00 pm EST on Tuesday,
December 6, 2011 and will run through midnight Tuesday, December
20, 2011. The number to access the conference call replay is
719-457-0820 or toll-free 888-203-1112. The passcode
for the replay is 4176937.
The conference call will also be webcast live on the Trust’s
website at www.chkgranitewashtrust.com in the “Investors” section
of the website. The webcast of the conference call will be
available on the Trust’s website for one year.
ABOUT CHESAPEAKE GRANITE WASH TRUST:
Chesapeake Granite Wash Trust is a Delaware statutory trust
formed by Chesapeake Energy Corporation to own certain royalty
interests in oil, natural gas liquids and natural gas wells in
Washita County, Oklahoma producing from the Colony Granite Wash
play within the broader Granite Wash formation of the Anadarko
Basin. The common units do not represent interests in and are not
obligations of Chesapeake Energy Corporation. The common units are
listed on the New York Stock Exchange under the symbol CHKR.
Further information is available at
www.chkgranitewashtrust.com where Chesapeake Granite Wash
Trust routinely posts announcements, updates, investor information
and news releases.
ABOUT CHESAPEAKE ENERGY CORPORATION:
Chesapeake Energy Corporation is the second-largest producer
of natural gas, a Top 15 producer of oil and natural gas liquids
and the most active driller of new wells in the U.S.
Headquartered in Oklahoma City, the company's operations are
focused on discovering and developing unconventional natural gas
and oil fields onshore in the U.S. Chesapeake owns leading
positions in the Barnett, Haynesville, Bossier, Marcellus and
Pearsall natural gas shale plays and in the Granite Wash,
Cleveland, Tonkawa, Mississippi Lime, Bone Spring, Avalon,
Wolfcamp, Wolfberry, Eagle Ford, Niobrara, Three Forks/Bakken and
Utica unconventional liquids plays. The company has also
vertically integrated its operations and owns substantial
midstream, compression, drilling, trucking, pressure pumping and
other oilfield service assets directly and indirectly through its
subsidiaries Chesapeake Midstream Development, L.P. and Chesapeake
Oilfield Services, L.L.C. and its affiliate Chesapeake Midstream
Partners, L.P. (NYSE:CHKM). Chesapeake’s stock is listed on
the New York Stock Exchange under the symbol CHK. Further
information is available at www.chk.com where
Chesapeake routinely posts announcements, updates, events, investor
information, presentations and news releases.
Pursuant to IRC Section 1446, withholding tax on income
effectively connected to a U.S. 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 U.S. sources allocated to foreign
partners should be made at 30% of gross income unless the rate is
reduced by treaty. This release is intended to be a
qualified notice to nominees and brokers as provided for under
Treasury Regulation Section 1.1446-4(b) by Chesapeake Granite Wash
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 news release contains statements that are
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements
contained in this news 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
Chesapeake with respect to the relevant quarterly 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. Neither
Chesapeake nor the Trustee intends, and neither assumes any
obligation, to update any of the statements included in this news
release. An investment in common units issued by Chesapeake Granite
Wash Trust is subject to the risks described in the Trust's
Prospectus filed November 14, 2011 with the Securities and Exchange
Commission. The Prospectus and the Trust's annual, quarterly and
other filed reports are or will be available at the SEC's website
at http://www.sec.gov.
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