#United States #Dallas #Boaz Energy #PermRock #T2S Permian

Overview of the Transaction

PermRock Royalty Trust (NYSE: PRT), based in Dallas, has recently disclosed significant developments regarding its oil and gas investment. On January 10, 2025, Boaz Energy II, LLC informed the Trust about a new Purchase and Sale Agreement with T2S Permian Acquisition II LLC, a firm based in Delaware. This transaction marks a pivotal moment for the Trust, which oversees an array of oil and gas properties.

Details of the Sale

Boaz Energy, the operator of the trust’s underlying oil and gas assets, will sell its rights and interests in these properties, which are essential to the Trust’s operations. This sale includes not only the physical assets but also 4,884,861 Trust units related to the properties, collectively termed as the Boaz Trust Units. These units represent beneficial ownership interests in the Trust, which receives 80% of the net profits derived from all production activities.

The Significance of the Underlying Properties

The Underlying Properties in question were designated under a net profits interest agreement established back in 2018. This structure has allowed the Trust to benefit from the profitability of the oil and gas extracted from these assets. As the transaction progresses, the underlying properties will remain bound by this net profits interest.

Conditions Prior to Closing

According to Boaz Energy, the agreement is subject to customary closing conditions. If these conditions are satisfied, the transaction is expected to close around March 2025. This timeline is crucial as it sets the stage for T2S Permian to step in as the new operator of these vital properties after the transition.

Transitioning Operations

As part of the deal, Boaz Energy has committed to assist in the smooth transition of operations from its management to T2S Permian. The Trust's trustee, Argent Trust Company, is anticipated to continue overseeing Trust management as usual, ensuring continuity for investors and stakeholders.

About PermRock Royalty Trust

PermRock Royalty Trust specializes in owning a net profits interest that confers on it a right to 80% of profits from oil and gas sales derived from its properties. This transaction highlights the Trust's focus on strategic partnerships that maximize value for its unit holders. For more detailed insights, interested readers can explore further on the Trust's official website at www.permrock.com.

Cautionary Notes

The announcements from PermRock carry forward-looking statements that reflect expectations or beliefs about future events. It's essential for stakeholders to consider these statements with caution as they involve inherent uncertainties, particularly pertaining to operational transitions and market conditions following the sale. These factors could significantly influence the eventual success of the transaction and the Trust's financial health moving forward.