Mesa Royalty Trust Announces There Will Be No Distribution for July 2020
July 21 2020 - 4:31PM
Business Wire
Mesa Royalty Trust (the “Trust”) (NYSE: MTR) announced today
that there will be no distribution paid for the month ended July
2020 to holders of record as of the close of business on July 31,
2020, as costs, charges and expenses attributable to the Trust’s
royalty properties exceeded the revenue received from the sale of
oil, natural gas and other hydrocarbons produced from such
properties, as reported by the working interest owners.
The Trust was formed to own an overriding royalty interest of
the net proceeds attributable to the specified interest in certain
producing oil and gas properties located in the Hugoton field of
Kansas and the San Juan Basin fields of New Mexico and Colorado. As
described in the Trust's filings, the amount of the monthly
distributions is expected to fluctuate from month to month,
depending on the proceeds received by the Trust as a result of
production, oil and natural gas prices and the amount of the
Trust’s administrative expenses, among other factors. The amount of
proceeds received or expected to be received by the Trust (and its
ability to pay distributions to unitholders) has been and will
continue to be directly affected, among other things, by the
volatility in commodity prices. Recently, there has been a
substantial decrease in oil and natural gas prices due in part to
significantly decreased demand as a result of the COVID-19 pandemic
and an oversupply of crude oil. Oil and natural gas prices could
remain low for an extended period of time, which in turn could have
a material adverse effect on Trust distributions. Continued low oil
and natural gas prices, among other things, will reduce proceeds to
which the Trust is entitled, which will reduce the amount of cash
available for distribution to unitholders and in certain periods
could result in no distributions to unitholders. To the extent that
costs, charges and expenses attributable to a royalty property
exceed the revenue received from the sale of oil, gas and other
hydrocarbons produced from such property in one month, such costs,
charges and expenses may be recovered by the working interest
owners before any distribution of royalty income from the
properties will be made to the Trust in future months.
This press release contains forward-looking statements. No
assurances can be given that the expectations contained in this
press release will prove to be correct. The working interest owners
alone control historical operating data, and handle receipt and
payment of funds relating to the royalty properties and payments to
the Trust for the related royalty. The Trustee cannot assure that
errors or adjustments or expenses accrued by the working interest
owners, whether historical or future, will not affect future
royalty income and distributions by the Trust. Other important
factors that could cause these statements to differ materially
include delays in actual results of drilling operations, risks
inherent in drilling and production of oil and gas properties,
declines in commodity pricing, and other factors described in the
Trust’s Form 10-K for the year ended December 31, 2019 under “Part
I, Item 1A. Risk Factors.” Statements made in this press release
are qualified by the cautionary statements made in such risk
factors. The Trust does not intend, and assumes no obligations, to
update any of the statements included in this press release.
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version on businesswire.com: https://www.businesswire.com/news/home/20200721005935/en/
Mesa Royalty Trust The Bank of New York Mellon Trust Company,
N.A., as Trustee Elaina Rodgers 713-483-6020
http://mtr.investorhq.businesswire.com/
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