Mesa Royalty Trust Announces Trust Income for July 2021
July 20 2021 - 4:20PM
Business Wire
Mesa Royalty Trust (the “Trust”) (NYSE: MTR) announced today the
Trust income distribution for the month of July 2021. Unitholders
of record on July 30, 2021 will receive distributions amounting to
$0.003925566 per unit, payable on October 29, 2021. The Trust
received $33,763, all of which came from the Colorado portion of
the Trust’s San Juan Basin properties operated by SIMCOE LLC, an
affiliate of IKAV Energy Inc. (“Operator”). No income was received
in July 2021 from any other working interest owner. The Trust was
formed to own an overriding royalty interest of the net proceeds
attributable to 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 public filings, the amount of the
monthly distributions is expected to fluctuate from month to month,
depending on the proceeds, if any, received by the Trust as a
result of production, oil and natural gas prices. Distributions to
unitholders are also impacted by the amount of the Trust’s
administrative expenses, among other factors, which may vary
significantly from month to month. On February 28, 2020, BP Amoco
Company (“BP”) completed the sale of all of its interest in the San
Juan Basin—Colorado properties to Operator. Following Operator’s
acquisition of BP’s interest in the San Juan Basin—Colorado
properties, there was a transition period to transfer historical
information, knowledge and processes from one owner to the other.
Operator has informed the Trustee that the amount paid to the
Trust, included in the July 2021 distribution calculation, is
subject to further adjustment in future periods for certain
expenses that Operator is entitled to deduct under the conveyance.
Operator is expected to recover such expense amounts by withholding
a portion or all of the net proceeds that would otherwise be
payable to the Trust in future periods. Any reduction in income
paid to the Trust for these properties may materially reduce or
eliminate distributions to the Trust’s unitholders in future
periods.
Proceeds reported by the working interest owners for any month
are not generally representative of net proceeds that will be
received by the Trust in future periods. As further described in
the Trust’s Form 10-K and Form 10-Q filings, production and
development costs for the royalty interest have resulted in
substantial accumulated excess production costs, which will
decrease Trust distributions, and in some periods may result in no
Trust distributions. The amount of proceeds, if any, 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 volatility in the
industry and revenues and expenses reported to the Trust by working
interest owners. Any additional expenses and adjustments, among
other things, will reduce proceeds to the Trust, which will reduce
the amount of cash available for distribution to unitholders and in
certain periods could result in no distributions to
unitholders.
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, 2020 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. Each
unitholder should consult its own tax advisor with respect to its
particular circumstances.
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version on businesswire.com: https://www.businesswire.com/news/home/20210720006132/en/
Mesa Royalty Trust The Bank of New York Mellon Trust Company,
N.A., as Trustee Elaina Rodgers 713-483-6020
http://mtr.q4web.com/home/default.aspx
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