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

Rhea-AI Summary

Permian Basin Royalty Trust (NYSE: PBT) has declared a cash distribution of $0.015311 per unit, payable on August 14, 2025, to unitholders of record on July 31, 2025. The distribution shows an increase from the previous month, driven by higher natural gas volumes and improved oil and gas pricing from the Texas Royalty Properties.

The Trust reported that Blackbeard Operating, the Waddell Ranch properties operator, has refused to provide monthly NPI information. The Trust is currently engaged in litigation against Blackbeard, seeking to recover over $9 million in damages related to improper royalty calculations from April 2020 through December 2023. The trial is scheduled for November 17, 2025.

The Texas Royalty Properties produced 12,190 barrels of oil and 10,109 Mcf of gas, with average prices of $68.37 per bbl for oil and $11.75 per Mcf for gas, contributing $901,654 to this month's distribution.

Positive

• None.

Negative

• Waddell Ranch properties continue to operate at an excess cost position with no distribution
• Blackbeard Operating refuses to provide monthly NPI information for Waddell Ranch properties
• Trust is involved in significant litigation seeking over $9 million in damages from Blackbeard
• Oil volumes decreased from 14,430 to 12,190 barrels compared to previous month

Insights

Oil & Gas Royalty Trust Analyst

PBT's $0.015311/unit July distribution relies solely on Texas properties; ongoing operator dispute impacts Waddell Ranch income.

Permian Basin Royalty Trust has declared a modest July distribution of $0.015311 per unit, slightly higher than the previous month but still constrained by significant challenges. The increase stems from the Texas Royalty Properties' improved natural gas volumes and better pricing for both oil ($68.37/bbl) and natural gas ($11.75/Mcf), despite lower oil production.

The concerning aspect is that for another month, no proceeds were received from the Waddell Ranch properties due to production costs exceeding gross proceeds. More troubling is Blackbeard Operating's refusal to provide the necessary monthly information to calculate the net profits interest. This ongoing information gap has forced the Trust to rely solely on quarterly disclosures, significantly reducing transparency for unitholders.

The litigation against Blackbeard has escalated, with the Trust filing a Second Amended Petition seeking over $9 million in damages. The lawsuit alleges improper calculation of overhead costs, labor expenses, and saltwater disposal fees, plus failure to pay on all production volumes. With a trial date set for November 17, 2025, this represents a potentially material recovery for the Trust, which could improve future distributions.

The Texas Royalty Properties, which represent the entirety of this month's distribution, generated net profits of $949,109, contributing $901,654 to the Trust after applying the 95% NPI. However, after deducting $188,020 in administrative expenses, the final distribution amounts to just $713,634 across 46.6 million outstanding units.

The Trust's distribution pattern demonstrates the vulnerability of royalty trusts to both commodity price fluctuations and operational disputes. The ongoing litigation highlights the importance of operator compliance in maintaining distribution levels, while the excess cost position at Waddell Ranch continues to suppress what would otherwise be a more substantial payout to unitholders.

DALLAS, July 21, 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 $0.015311 per unit, payable on August 14, 2025, to unit holders of record on July 31, 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 May, 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 increased compared to the previous month due primarily to the Texas Royalty Properties having higher natural gas volumes, along with higher oil and natural gas pricing, partially offset by lower oil volumes for the month reported.

WADDELL RANCH
Notwithstanding requests from the Trustee to Blackbeard Operating, LLC ("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 July 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 August distribution.

As noted above, no proceeds were received by the Trustee in June 2025 to be included in the July 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 13,896 barrels of oil and 11,503 Mcf of gas. The production for the Trust's allocated portion of the Texas Royalty Properties was 12,190 barrels of oil and 10,109 Mcf of gas. The average price for oil was $68.37 per bbl and for gas was $11.75, which includes significant NGL pricing, per Mcf. This would mainly reflect production and pricing in April for oil and March 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 $1,085,196. Deducted from these revenues were taxes and expenses of $136,087, resulting in a Net Profit of $949,109 for July. With the Trust's NPI of 95% of the Underlying Properties, this would result in a net contribution by the Texas Royalty Properties of $901,654 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	13,896	11,503	12,190	10,109	$68.37	$11.75
Prior Month
Waddell Ranch	(3)	(3)	(3)	(3)	(3)	(3)
Texas Royalties	16,367	9,392	14,430	8,278	$65.46	$9.48

(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 $188,020 resulting in a distribution of $713,634 to 46,608,796 units outstanding, or $0.015311 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 27, 2025, the Trustee announced that it had filed a Second Amended Petition in the District Court of Tarrant County, Texas in connection with its lawsuit against Blackbeard, the operator of properties in Waddell Ranch, in Crane County, Texas, in which the Trust holds a 75% net overriding royalty. On May 8, 2024, the Trustee announced that it had initiated the lawsuit by filing a petition in the District Court of Tarrant County, Texas, and 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.

Under the Second Amended Petition, the Trustee seeks to recover more than $9 million in damages to the Trust it alleges result from Blackbeard's failure to properly calculate and pay royalites due and owing to the Trust. Specifically, the Trustee alleges that Blackbeard impermissibly calculated and deducted overhead costs, labor expenses, and saltwater disposal fees. The Trustee also claims Blackbeard failed to pay on all volumes of oil, gas, and other minerals produced by Blackbeard from the relevant lands and failed to provide annual reports required by the Conveyance. The claims relate to the April 2020 through December 2023 production months. A joint venture audit of the 2024 production months is underway, and the Trustee reserved the right in the petition to bring any additional claims revealed by such audit. Certain additional claims raised in the Trustee's original and first amended petitions have been resolved through prior joint venture audits.

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

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SOURCE Permian Basin Royalty Trust

FAQ

What is PBT's distribution amount and payment date for July 2025?

PBT declared a distribution of $0.015311 per unit, payable on August 14, 2025, to unitholders of record on July 31, 2025.

Why are there no proceeds from Waddell Ranch properties in PBT's July 2025 distribution?

Production costs exceeded gross proceeds, resulting in a continuing excess cost position. Additionally, Blackbeard Operating has refused to provide monthly NPI information necessary to calculate proceeds.

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

The Trust's allocated portion of Texas Royalty Properties produced 12,190 barrels of oil and 10,109 Mcf of gas, with average prices of $68.37 per bbl for oil and $11.75 per Mcf for gas.

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

The Trust is seeking to recover over $9 million in damages related to improper royalty calculations from April 2020 through December 2023.

When is the trial date for PBT's lawsuit against Blackbeard Operating?

The trial is scheduled for November 17, 2025, at 8:30 a.m. Central Time in the District Court of Tarrant County, Texas.