DALLAS, March 18, 2024 /PRNewswire/ -- Argent Trust Company, as the trustee (the "Trustee") of the San Juan Basin Royalty Trust (the "Trust") (NYSE: SJT), today declared a monthly cash distribution to the holders (the "Unit Holders") of its units of beneficial interest (the "Units") of $1,923,926.56 or $0.041278 per Unit, based primarily upon the reported production of the Trust's subject interests (the "Subject Interests") during the month of January 2024. The distribution is payable April 12, 2024, to the Unit Holders of record as of March 28, 2024.

For the production month of January 2024, the owner of the Subject Interests, Hilcorp San Juan L.P. and the operator of the Subject Interests, Hilcorp Energy Company (collectively, "Hilcorp"), reported to the Trust net profits of $3,277,646 gross ($2,458,235 net royalty amount to the Trust).

Hilcorp reported $6,667,167 of total revenue from the Subject Interests for the production month of January 2024, consisting of $6,585,684 of gas revenues and $81,483 of oil revenues. For the Subject Interests, Hilcorp reported $3,389,520 of production costs for the production month of January 2024, consisting of $2,508,461 of lease operating expenses, $798,660 of severance taxes, and $82,399 of capital costs.

Based upon information provided to the Trust by Hilcorp, gas volumes for the subject interests for January 2024 totaled 1,808,545 Mcf (2,009,495 MMBtu), as compared to 1,909,007 Mcf (2,121,119 MMBtu) for December 2023. Dividing gas revenues by production volume yielded an average gas price for January 2024 of $3.64 per Mcf ($3.28 per MMBtu), as compared to an average gas price for December 2023 of $2.99 per Mcf ($2.69 per MMBtu).

Hilcorp previously provided the Trust with its 2024 capital project plan for the Subject Interests (the "2024 Plan"), which estimated 2024 capital expenditures for the Subject Interests to be $36 million.  Hilcorp advised the Trust that the 2024 Plan for the Subject Interests has been revised to remove a planned capital project involving a vertical drill well that was contemplated in the Dakota/Mesaverde formations.  This decreases the estimated capital expenditures under the 2024 Plan to $34 million. Hilcorp further informed the Trust that its 2024 capital project plans are subject to revision if Hilcorp revises its assumptions underlying the 2024 Plan, and that actual capital costs in 2024 may vary from the estimates in the 2024 Plan.

Pursuant to the Amended and Restated Royalty Trust Indenture, dated December 12, 2007 (as amended on February 15, 2024, by the First Amendment to the Amended and Restated Royalty Trust Indenture), the Trustee is authorized to retain, in its sole discretion, a cash reserve for payment of Trust liabilities that are contingent or uncertain or otherwise not currently due and payable. The Trustee previously maintained a cash reserve in the amount of $1.0 million.  However, in order to cover Trust expenses during any period of revenue shortfall, which could result from lower commodity prices or increased capital expenditures under Hilcorp's 2024 Plan, the Trustee will increase the cash reserves over the coming months to $2.0 million. The Trustee will reserve $400,000 in cash from the royalty income received by the Trust in March 2024 to increase cash reserves, which will bring the balance of cash reserves to $1.4 million.