Permian Basin Royalty Trust Reveals August Distribution Amid Ongoing Cost Challenges

Overview of the August Cash Distribution

The Permian Basin Royalty Trust (NYSE: PBT) has officially announced its cash distribution for the month of August 2025, valued at $0.016418 per unit. This distribution is set to be paid on September 15, 2025, to unit holders recorded as of August 29, 2025. Notably, this disbursement does not include any revenues from the Waddell Ranch properties. The anticipated cash flow from these properties faced significant challenges as total production costs surpassed the gross earnings reported for the month of July, leaving the Trust with a persistent excess cost position regarding these properties.

Production Insights

While August's distribution showed an improvement compared to the previous month, it primarily stemmed from increased natural oil production from the Texas Royalty Properties, despite some reductions in natural gas output alongside declines in both oil and gas pricing. The Trust’s allocation from the Texas Royalty Properties for August demonstrated a total output of 14,645 barrels of oil and 8,742 Mcf of gas. In particular, production prices averaged $62.02 per barrel of oil and $7.53 per Mcf of gas, reflecting dynamics in pricing trends from earlier months. Following deductions for taxes and expenses, the Trust recorded a net profit of $971,212 for August, contributing approximately $922,651 toward the current distribution.

Current Situation at Waddell Ranch

In terms of the Waddell Ranch properties, the Trustee faced hurdles in obtaining necessary financial data from Blackbeard Operating, LLC, the operator for these assets. It has been noted that Blackbeard has failed to provide the required information for computing net profits interest (NPI) proceeds for August 2025, citing policy changes that limit their reporting to quarterly rather than monthly updates. This lack of information directly impacted the distributions from Waddell Ranch, whereby no proceeds were included in the August payout. Any excess costs incurred must first be recouped with future earnings from these properties before any additional proceeds can be disbursed to the Trust.

Legal Developments

Compounding the Trust’s challenges, litigation remains ongoing against Blackbeard. On May 27, 2025, the Trustee filed a Second Amended Petition in the Tarrant County District Court related to its lawsuit against Blackbeard. The Trustee argues that Blackbeard inadequately calculated and paid the royalties due, claiming damages exceeding $9 million. These allegations stem from mismanagement of overhead costs and labor charges among other compliance failures. The trial is set for November 17, 2025, which could further clarify the fiscal standing of the Trust.

Summary

In summary, while the Permian Basin Royalty Trust has announced a cash distribution for August, the ongoing issues regarding production costs and litigation indicate a complex financial landscape. The effects of local and global market conditions continue to challenge pricing and overall earnings potential, making it difficult for the Trust to predict future distributions reliably. Stakeholders are advised to stay informed as developments arise, particularly regarding the performance of the Waddell Ranch properties and the anticipated court proceedings against Blackbeard Operating.

For further information regarding the Trust’s financial status, stakeholders can refer to the official Permian Basin Royalty Trust website at http://www.pbt-permian.com/ for comprehensive historical data, tax details, and SEC filings.