SAN JUAN BASIN ROYALTY TRUST 8K

San Juan Basin Royalty Trust reported it will pay no August 2026 cash distribution and will not resume payouts until substantial excess production costs, reserves, and line-of-credit obligations are fully covered amid ongoing low gas prices and reduced Hilcorp development activity.

On August 21, 2026, Argent Trust Company, as trustee of the San Juan Basin Royalty Trust, announced that no cash distribution will be declared for August 2026 because production costs and capital expenditures, including those related to two new horizontal wells drilled by Hilcorp San Juan L.P. in 2024, continue to exceed revenues amid low natural gas prices, leaving cumulative excess production costs at approximately $11.4 million gross ($8.6 million net to the Trust). As a result, all future net proceeds will be applied first to eliminate this excess cost balance, then to replenish a $2 million reserve and repay principal and interest on the Trust’s $1.0 million line of credit with Texas Bank before any distributions can resume. For the June 2026 production month, Hilcorp reported $3.18 million of revenue and $4.97 million of production costs (excluding excess cost recoveries), and separately reduced its 2026 development plan for the Subject Interests by removing five of nine previously planned vertical wells, while continuing progress on the remaining four wells; the trustee also noted ongoing audits and engagement with Hilcorp regarding accounting, pricing, and cost allocations, and confirmed that due to depleted reserves the Trust continues to self-publish monthly press releases on its website and use its line of credit to fund administrative expenses.

Filing Facts

CIK

319655

Ticker

-

Form

8K

Source Type

sec

Accession

0001193125-26-360880

Alert Tier

7