#United States #Dallas #Permian Basin #Argent Trust #Blackbeard Operating

Permian Basin Royalty Trust Takes Legal Action Against Blackbeard Operating

The Permian Basin Royalty Trust (NYS: PBT), under the stewardship of Argent Trust Company, has officially filed a Second Amended Petition in the District Court of Tarrant County, Texas. This lawsuit is directed at Blackbeard Operating, LLC, the operator of properties located in Waddell Ranch, Crane County, Texas, where the Trust holds a substantial 75% net overriding royalty.

The crux of the issue lies in allegations made by the Trust regarding an estimated $9 million in damages stemming from alleged improper calculations and payments of royalties owed to the Trust by Blackbeard. Specifically, the Trust claims that Blackbeard has wrongly deducted costs associated with overhead, labor, and saltwater disposal from the royalties that should have been allocated to the Trust.

The Trustee has further accused Blackbeard of failing to compensate the Trust accurately for all oil, gas, and other minerals extracted from the specified lands. Moreover, it is claimed that there was a lack of transparency regarding annual reports mandated by the Conveyance, contributing to the Trust's grievances.

Timeline and Legal Proceedings

The production months in question span from April 2020 through December 2023, indicating a lengthy period during which these discrepancies purportedly occurred. As part of the legal proceedings, a joint venture audit for the 2024 production months is currently in progress. The Trustee has noted that they reserve the right to introduce more claims in the case any new findings emerge from this audit. Importantly, some claims raised in earlier petitions have been resolved through this joint audit process.

With the trial date set for November 17, 2025, at 8:30 a.m. Central Time, the legal teams involved are engaging in discovery processes that include thorough on-site audits of the Waddell Ranch properties. This phase also involves the insights of expert witnesses and a comprehensive review of documents provided by Blackbeard.

Industry Impact

This legal showdown is significant not just for the parties involved but also for the oil and gas industry at large. A failure to uphold royalty payments, along with miscalculations, can erode trust between operators and royalty trusts. Such legal challenges may set precedents for future transactions in the resource extraction sector, influencing how agreements and partnerships are negotiated.

Forward-Looking Statements

As highlighted in the Trust's announcement, any forward-looking statements about future events or outcomes are bound to fluctuation due to numerous risk factors as outlined in the Trust’s filings. Stakeholders are advised to consider these implications carefully, as they may affect strategic decisions in similar contexts.

For more information or inquiries related to this legal initiative, stakeholders are encouraged to reach out to Jana Egeler, Vice President at Argent Trust Company, via their toll-free contact number.

The forthcoming trial will undoubtedly attract attention from both industry experts and media outlets, as it underscores vital issues regarding royalty agreements and operational transparency in the oil and gas sector.