San Juan Basin Royalty Trust declares no cash distribution for July

San Juan Basin Royalty Trust’s trustee Argent Trust reported that San Juan Basin will not declare a monthly cash distribution to the holders of its units of beneficial interest due to excess production costs for the Trust’s subject interests during May 2024, as well as lower natural gas pricing. Excess production costs for this reporting period are due primarily to significant lease operating expenses and capital expenditures associated with Hilcorp San Juan’s 2024 capital project plan. Hilcorp reported $2,518,037 of total revenue for May 2024, and $6,183,810 of production costs. Hilcorp will charge the excess production costs of approximately $4,888,522 gross to the next month’s distribution. No cash distributions will be made by the Trust until future net proceeds are sufficient to pay then-current Trust liabilities and replenish cash reserves. Total cash reserves were $1.8M as of April 30, 2024. This month, cash reserves in the amount of $47,206 will be utilized to cover the balance of Trust administrative expenses which will bring the balance of cash reserves maintained by the Trustee to $1,420,537. Prior to any future distributions to Unit Holders, the Trustee plans to replenish the cash reserves and continue to increase the cash reserves to $2.0M. Revenues and costs are the subject of the Trust’s ongoing comprehensive audit process by the Trust’s professional consultants and outside counsel to analyze compliance with all the underlying operative Trust agreements and evaluate potential remedies in the event there is suspected non-compliance.