Argent Trust Company, as the trustee of the San Juan Basin Royalty Trust, reported the decision to not declare a monthly cash distribution for December 2025.
Excess production costs and continued low natural gas pricing were cited as the reasons for this decision.
Hilcorp will keep charging the balance of excess production costs to the Trust's net proceeds each month until it is fully paid off.
No Cash Distribution Declared
Excess production costs and low natural gas pricing led to the decision to withhold cash distributions for December 2025.
Impact on Royalty Income
All net proceeds will be used to repay the excess production costs and other liabilities before cash distributions can resume.
Revenue Update
Hilcorp reported $5,302,314 of total revenue from Subject Interests, with gas revenues of $5,120,863 and oil revenues of $181,451 for October 2025.
Gas Price Increase
The average gas price for October 2025 was $2.23 per Mcf, marking an increase from the previous month's average.
Audit and Compliance
The Trust continues rigorous auditing processes to ensure compliance with Trust agreements and evaluate potential remedies for non-compliance.
- The Trust faced challenges due to excess production costs and low natural gas pricing, resulting in the decision to suspend cash distributions.
- Hilcorp's ongoing charges towards excess production costs impact the Trust's ability to generate royalty income for Unit Holders.
- The increase in average gas price for October 2025 indicates some positive developments despite the financial challenges faced by the Trust.
The San Juan Basin Royalty Trust's decision to withhold cash distributions reflects a strategic move to address financial liabilities and prioritize debt repayment. Unit Holders should monitor upcoming financial updates for signals on the Trust's future distribution plans.