PERMIAN BASIN ROYALTY TRUST ANNOUNCES APRIL CASH DISTRIBUTION AND EXCESS COST POSITION ON WADDELL RANCH PROPERTIES

Rhea-AI Summary

Permian Basin Royalty Trust (NYSE: PBT) has announced an April cash distribution of $0.019615 per unit, payable on May 14, 2025. The distribution reflects only proceeds from Texas Royalty Properties, as Waddell Ranch properties continue to show an excess cost position. Texas Royalty Properties reported production of 15,292 barrels of oil at $71.97/bbl and 8,991 Mcf of gas at $11.54/Mcf, resulting in a net contribution of $1,143,639.

Notably, Blackbeard Operating has refused to provide monthly NPI proceeds information for Waddell Ranch properties. The Trust is currently engaged in litigation against Blackbeard, seeking over $25 million in damages related to disputed overhead charges and other expenses. The trial is scheduled for November 17, 2025.

Positive

• Slight increase in distribution from previous month due to higher oil volumes and improved oil/gas pricing
• Texas Royalty Properties showed increased oil production from 14,957 to 15,292 barrels
• Gas pricing improved significantly from $7.88 to $11.54 per Mcf

Negative

• Waddell Ranch properties continue to operate at a loss with excess costs
• Blackbeard Operating refusing to provide monthly NPI proceeds information
• Lower natural gas volumes compared to previous month (decrease from 9,462 to 8,991 Mcf)
• Ongoing litigation with operator causing uncertainty and additional expenses

Insights

Financial Analyst

Permian Basin Trust announces modest $0.019615 distribution while facing ongoing Waddell Ranch challenges and $25M litigation against operator Blackbeard.

Permian Basin Royalty Trust's April distribution of $0.019615 per unit ($914,265 total) represents an annualized yield of approximately 2.4% at current unit prices. While this marks a slight increase from the previous month, the distribution excludes any proceeds from the significant Waddell Ranch properties due to continuing excess production costs over gross proceeds.

The most concerning aspect is the deteriorating relationship with Blackbeard, the Waddell Ranch operator, who now refuses to provide monthly information needed to calculate the Trust's net profits interest. This forced shift from monthly to quarterly reporting significantly reduces transparency for unitholders. Texas Royalty Properties remain the Trust's only income source, producing 15,292 barrels of oil (at $71.97/bbl) and 8,991 Mcf of gas (at $11.54/Mcf), generating $1.14M in net contribution.

The expanded litigation against Blackbeard now seeks over $25M in damages (5.6% of Trust's market cap) for allegedly improper expense deductions, including incorrect overhead charges and duplicate expenses. With the trial scheduled for November 2025, this creates prolonged uncertainty. Resolution attempts have failed, suggesting deeply entrenched positions.

For investors, this distribution maintains minimal income flow, but the Waddell Ranch situation creates a material revenue shortfall compared to historical levels. Any future distributions from these properties depend on complete recovery of all excess costs, placing significant pressure on the Texas Royalty Properties to sustain unitholder returns in the interim.

DALLAS, April 17, 2025 /PRNewswire/ -- Argent Trust Company, as Trustee of the Permian Basin Royalty Trust (NYSE: PBT) ("Permian" or the "Trust") today declared a cash distribution to the holders of its units of beneficial interest of $0.019615 per unit, payable on May 14, 2025, to unit holders of record on April 30, 2025. The distribution does not include proceeds from the Waddell Ranch properties, as total production costs ("Production Costs") exceeded gross proceeds ("Gross Proceeds") for the month of March, resulting in a continuing excess cost position for the Waddell Ranch properties. More information regarding the Waddell Ranch properties is described below.

This month's distribution slightly increased from the previous month due primarily to the Texas Royalty Properties having higher oil volumes, along with higher oil and natural gas pricing, partially offset by lower natural gas volumes for the month reported.  

WADDELL RANCH
Notwithstanding requests from the Trustee to Blackbeard, the operator of the Waddell Ranch properties, and the fact that prior to May 2024, Blackbeard has provided this information on a monthly basis since Argent Trust Company has become Trustee of the Trust, Blackbeard has refused to provide the Trustee information necessary to calculate the net profits interest ("NPI") proceeds for April 2025 as of the announcement date for this month's distribution. As a result of Blackbeard's failure to provide this information by the NYSE notification date for the distribution, in accordance with the Trust indenture, if NPI proceeds are received from the Waddell Ranch properties on or prior to the record date, they will be included in the May distribution.     

As noted above, no proceeds were received by the Trustee in March 2025 to be included in the April distribution.  All excess costs, including any accrued interest, will need to be recovered by future proceeds from the Waddell Ranch properties before any proceeds are distributed to the Trust. Due to the fact that Blackbeard is providing production, pricing and cost information quarterly instead of monthly, the Trustee will be providing that information in the quarterly reports on Form 10-Q and annual reports on Form 10-K for the foreseeable future (to the extent timely received from Blackbeard).

TEXAS ROYALTY PROPERTIES
Production for the underlying Texas Royalty Properties was 17,157 barrels of oil and 10,093 Mcf of gas. The production for the Trust's allocated portion of the Texas Royalty Properties was 15,292 barrels of oil and 8,991 Mcf of gas. The average price for oil was $71.97 per bbl and for gas was $11.54, which includes significant NGL pricing, per Mcf. This would mainly reflect production and pricing in January for oil and December for gas. These allocated volumes were impacted by the pricing of both oil and gas. This production and pricing for the underlying properties resulted in revenues for the Texas Royalty Properties of $1,351,295. Deducted from these revenues were taxes and expenses of $147,465, resulting in a Net Profit of $1,203,830 for April. With the Trust's NPI of 95% of the Underlying Properties, this would result in a net contribution by the Texas Royalty Properties of $1,143,639 to this month's distribution.

	Underlying Properties		Net to Trust Sales
	Volumes		Volumes		Average Price
	Oil  (bbls)	Gas  (Mcf)	Oil  (bbls)	Gas  (Mcf) (1)	Oil  (per bbl)	Gas  (per Mcf) (2)
Current Month
Waddell Ranch	(3)	(3)	(3)	(3)	(3)	(3)
Texas Royalties	17,157	10,093	15,292	8,991	$71.97	$11.54
Prior Month
Waddell Ranch	(3)	(3)	(3)	(3)	(3)	(3)
Texas Royalties	16,839	10,659	14,957	9,462	$70.81	$7.88

 

	(1) These volumes are net to the Trust, after allocation of expenses to Trust's net profit interest, including any prior period adjustments.
	(2) This pricing includes sales of gas liquid products.
	(3) Information is not being made available monthly but may be provided within 30 days next following the close of each calendar quarter. To the extent the Trustee receives such information timely following the quarter, information will be included in the Trust's quarterly report on Form 10-Q for the applicable quarter (or the annual report on Form 10-K with respect to the fourth quarter).

General and Administrative Expenses deducted for the month, net of interest earned were $229,374 resulting in a distribution of $914,265 to 46,608,796 units outstanding, or $0.019615 per unit.

The worldwide market conditions continue to affect the pricing for domestic production. It is difficult to predict what effect these conditions will have on future distributions.

TRUST LITIGATION
On May 8, 2024, the Trustee announced that it had initiated a lawsuit by filing a petition in the District Court of Tarrant County, Texas against Blackbeard Operating, LLC ("Blackbeard"), the operator of properties in the Waddell Ranch, in Crane County, Texas, in which the Trust holds a 75% net overriding royalty. On June 10, 2024, Blackbeard filed its original answer and counterclaim to the lawsuit. The trial date in the District Court of Tarrant County is scheduled for November 17, 2025, 8:30 a.m., Central Time. Discovery is ongoing, including on-site audits of the Waddell Ranch properties, engagement of and analyses by expert witnesses, and review of documents provided by Blackbeard.

Under the original petition, the Trustee sought to recover more than $15 million in damages to the Trust resulting from overhead costs and other expenses the Trustee alleges were impermissibly deducted from royalty payments to the Trust. The Trustee routinely engages in audits of the revenues and expenses with respect to the Trust's royalty payments. In connection with its audit for the period from 2020-2022 the Trustee identified exceptions to certain expenses deducted from the Trust's royalty payments, including among other things, incorrect overhead charges, application of overhead charges to non-producing wells, duplicate charges for services, materials and utilities as well as other expenses the Trustee alleges are ineligible charges. The Trustee's petition was amended in September 2024 to add additional claims relating to the 2023 audit and production volumes, seeking damages of more than $25 million. Attempts to resolve the disputed charges outside of court have been unsuccessful to date. Included in Blackbeard's original answer and counterclaim are requests for declaratory judgment by the court that it may deduct certain disputed overhead charges from Trust royalty payments and that it may limit information it provides to the Trust to quarterly statements of the net proceeds computation and inspection of books and records during normal business hours.

The 2024 Annual Report with Form 10-K, which includes the December 31, 2024, Reserve Summary, has been filed with the Securities Exchange Commission. Permian's cash distribution history, current and prior year financial reports, tax information booklets, and a link to filings made with the Securities and Exchange Commission, all can be found on Permian's website at http://www.pbt-permian.com/. Additionally, printed reports can be requested and are mailed free of charge.

FORWARD-LOOKING STATEMENTS
Any statements in this press release about future events or conditions, and other statements containing the words "estimates," "believes," "anticipates," "plans," "expects," "will," "may," "intends," and similar expressions, other than historical facts, constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Factors or risks that could cause the Trust's actual results to differ materially from the results the Trustee anticipates include, but are not limited to the factors described in Part I, Item 1A, "Risk Factors" of the Trust's Annual Report on Form 10-K for the year ended December 31, 2024, and Part II, Item 1A, "Risk Factors" of subsequently filed Quarterly Reports on Form 10-Q.

Actual results may differ materially from those indicated by such forward-looking statements. In addition, the forward-looking statements included in this press release represent the Trustee's views as of the date hereof. The Trustee anticipates that subsequent events and developments may cause its views to change. However, while the Trustee may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Trustee's views as of any date subsequent to the date hereof.

Contact: Jana Egeler, Vice President, Argent Trust Company, Trustee, Toll Free – 1.855.588.7839

View original content:https://www.prnewswire.com/news-releases/permian-basin-royalty-trust-announces-april-cash-distribution-and-excess-cost-position-on-waddell-ranch-properties-302431155.html

SOURCE Permian Basin Royalty Trust

FAQ

What is the April 2025 distribution amount for Permian Basin Royalty Trust (PBT)?

PBT announced a cash distribution of $0.019615 per unit, payable on May 14, 2025, to unitholders of record on April 30, 2025.

Why are there no proceeds from Waddell Ranch properties in PBT's April distribution?

Production costs exceeded gross proceeds for Waddell Ranch properties in March, resulting in a continuing excess cost position with no distributable proceeds.

What are the current production volumes and prices for PBT's Texas Royalty Properties?

Texas Royalty Properties produced 15,292 barrels of oil at $71.97 per barrel and 8,991 Mcf of gas at $11.54 per Mcf for the Trust's allocated portion.

How much is PBT seeking in damages from Blackbeard Operating in the ongoing lawsuit?

The Trust is seeking over $25 million in damages related to disputed overhead charges and other expenses allegedly improperly deducted from royalty payments.