# Permian Basin Royalty Trust: Form 10-Q for the period ended Jun 30, 2025

- Company: [Permian Basin Royalty Trust](/companies/pbt.md) (CIK 319654)
- Form: 10-Q
- Filed: 2025-08-13
- Accepted by EDGAR: Aug 13, 2025, 18:07 ET
- Period: 2025-06-30
- Accession: 0000950170-25-107874
- Inline XBRL: no
- Main document: https://www.sec.gov/Archives/edgar/data/319654/000095017025107874/pbt_10q_6-30-2025.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/319654/000095017025107874/

## Management's discussion and analysis

As filed, 26,053 characters.

### Forward Looking Information

Certain information included in this report contains, and other materials filed or to be filed by the Trust with the Securities and Exchange Commission (as well as information included in oral statements or other written statements made or to be made by the Trust) may contain or include, forward looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Such forward looking statements may be or may concern, among other things, capital expenditures, drilling activity, development activities, production efforts and volumes, hydrocarbon prices and the results thereof, litigation, information to be received by operators of the Waddell Ranch properties or Texas Royalty properties, and regulatory matters. Although the Trustee believes that the expectations reflected in such forward-looking statements are reasonable, such expectations are subject to numerous risks and uncertainties and the Trustee can give no assurance that they will prove correct. There are many factors, none of which are within the Trustee’s control, that may cause such expectations not to be realized, including, among other things, factors such as actual oil and gas prices and the recoverability of reserves, capital expenditures, general economic conditions, actions and policies of petroleum-producing nations and other changes in the domestic and international energy markets. Such forward looking statements generally are accompanied by words such as “estimate,” “expect,” “predict,” “anticipate,” “goal,” “should,” “assume,” “believe,” or other words that convey the uncertainty of future events or outcomes.

### Commodity Prices

The Trust’s income and monthly distributions are heavily influenced by commodity prices. Commodity prices may fluctuate widely in response to (i) relatively minor changes in the supply of and demand for oil and natural gas, (ii) market uncertainty and (iii) a variety of additional factors that are beyond the Trustee’s control. Recently, there has been volatility in oil and natural gas prices due in part to geopolitical conditions in Eastern Europe and the Middle East. In the first half of 2024, the price of oil and gas began to increase over 2023 prices, due to tensions in the Middle East and OPEC cutting oil production; however, the price began to decrease in the third quarter of 2024 due to lower demand. The price of oil hit a high price of $79.28 per barrel on January 17, 2025 and steadily decreased through May 2025. Since that time, the price of oil has increased slightly such that as of July 28, 2025 the price of oil was $67.81 per barrel. Factors that may impact future commodity prices, including the price of oil and natural gas, include but are not limited to:

- political conditions in major oil producing regions, including the conflicts in Eastern Europe and the Middle East
- worldwide economic and geopolitical conditions;
- weather conditions;
- trade barriers and tariffs;
- public health concerns;
- the supply and price of domestic and foreign crude oil or natural gas;
- the level of consumer demand;
- the price and availability of alternative fuels;
- the proximity to, and capacity of, transportation facilities;
- the effect of worldwide energy conservation measures and governmental policies and regulatory incentives for investment in non-fossil fuel energy sources; and
- the nature and extent of governmental regulation and taxation.

Although the Trustee cannot predict the occurrence of events that may affect future commodity prices or the degree to which these prices will be affected, gas royalty income for a given period generally relates to production three months prior to the period and crude oil royalty income for a given period generally relates to production two months prior to the period and will generally approximate current market prices in the geographic region of the production at the time of production. When crude oil and natural gas prices decline, the Trust is affected in two ways. First, distributable income from the Royalty properties is reduced. Second, exploration and development activity by operators on the Royalty properties may decline as some projects may become uneconomic and are either delayed or eliminated. It is impossible to predict future crude oil and natural gas price movements, and this reduces the predictability of future cash distributions to Unitholders.

### Liquidity and Capital Resources

As stipulated in the Trust Indenture, the Trust is intended to be passive in nature, and the Trustee does not have any control over or any responsibility relating to the operation of the Underlying Properties. The Trustee has powers to collect and distribute proceeds received by the Trust and pay Trust liabilities and expenses and its actions have been limited to those activities. The Trust is a passive entity and other than the Trust’s ability to periodically borrow money as necessary to pay expenses, liabilities and obligations of the Trust that cannot be paid out of cash held by the Trust, the Trust is prohibited from engaging in borrowing transactions. As a result, other than such borrowings, if any, the Trust has no source of liquidity or capital resources other than the Royalties.

### Results of Operations

### Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

For the quarter ended June 30, 2025, royalty income received by the Trust amounted to $3,089,889 compared to royalty income of $8,803,389 during the second quarter of 2024. Due to Blackbeard refusing to provide the Trustee information necessary to calculate the net proceeds as of the NYSE notification date beginning May 2024, pricing information for the Waddell Ranch properties is for March, April and May 2025 (reflecting the period for which proceeds would have been distributed to Unitholders in the second quarter of 2025). For the Waddell Ranch properties, the average realized oil and gas prices were $70.27 per barrel (Bbl) and $2.41 per thousand cubic feet (Mcf), respectively for the three months ended May 31, 2025, compared to $73.40 and $1.83 for the months of April and May 2024 (reflecting the two months for which proceeds were distributed to Unitholders in the second quarter of 2024). The average realized price of gas was calculated by dividing the total gas and plant product sales by the total gas and plant product volumes (converted to an Mcf equivalent). For the Texas Royalty properties, the average realized oil and gas prices were $68.61 per Bbl and $10.15 per Mcf, respectively for the quarter ended June 30, 2025, compared to $78.00 per Bbl and $10.04 per Mcf, respectively for the quarter ended June 30, 2024. The lower royalty income reported in the three months ended June 30, 2025, compared to the same time period in 2024 is attributable to a deficit position in the second quarter of 2025, resulting in no royalty income being received from the Waddell Ranch properties due to an excess in working interest costs during the second quarter of 2025. No deficit position existed during the second quarter of 2024, and royalty income was received from the Waddell Ranch properties during such period. Blackbeard continues to refuse to provide information regarding monthly net proceeds in time for the monthly distribution announcement.

Interest income for the quarter ended June 30, 2025 was $15,751 compared to $29,106 during the second quarter of 2024. The decrease in interest income is primarily attributable to decreased amounts of funds available for investment. Total expenses during the second quarter of 2025 amounted to $708,385 compared to $395,807 during the second quarter of 2024. The increase in total expenses can be primarily attributed to increased expenses for professional services associated with legal proceedings with Blackbeard.

These transactions resulted in distributable income for the quarter ended June 30, 2025 of $2,397,255 or $0.05 per Unit outstanding of beneficial interest. Distributions of $0.019615, $0.018841 and $0.012976 per Unit were made to Unitholders of record as of April 30, 2025, May 31, 2025, and June 30, 2025, respectively. For the second quarter of 2024, distributable income was $8,436,688 or $0.18 per Unit outstanding of beneficial interest.

Notwithstanding requests from the Trustee to Blackbeard, the operator of the Waddell Ranch properties, Blackbeard has refused to provide the Trustee information necessary to calculate the net proceeds as of the NYSE notification date beginning May 2024 such that royalty income for the Trust for the second quarter of the calendar year is associated with actual oil and gas production for January, February, and March 2025 for the Waddell Ranch properties from which "Royalties" were carved. Royalty income for the Trust for the second quarter of the calendar year for the Texas Royalty properties is associated with actual oil and gas production from February, March, and April 2025.

Beginning in May 2024, Blackbeard has also refused to provide production, product sales, capital expenditure, and development information for the Waddell Ranch properties from which the Trust's Royalties are carved for each distribution month, information Blackbeard has previously provided on a monthly basis since Argent Trust Company has become Trustee of the Trust. Blackbeard has opted to provide this information quarterly, approximately 30 days after the end of each fiscal quarter. On July 30, 2025, Blackbeard provided the Trustee a quarterly statement showing the production volumes and computation of net proceeds to the Trust for each month of the quarter ended June 30, 2025. For the quarter ended June 30, 2024, only the months of April and May are shown below, as those were the only two months for which the Trust received information in time to distribute proceeds for the Waddell Ranch properties during the second quarter of 2024. Oil and gas sales attributable to the Royalties and the properties from which the Royalties were carved are as follows:

| Royalties | Waddell Ranch Properties 2025 March | April | May | Total | 2024 April | May | Total |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Oil sales (Bbls) | 247,367 | 245,459 | 276,448 | 769,274 | 182,168 | 191,222 | 373,390 |
| Gas sales (Mcf) | 1,168,967 | 1,158,514 | 1,331,903 | 3,659,384 | 1,046,589 | 1,122,492 | 2,169,081 |
| **Properties From Which The Royalties Were Carved:** |  |  |  |  |  |  |  |
| Oil: |  |  |  |  |  |  |  |
| Total oil sales (Bbls) | 329,823 | 327,279 | 368,597 | 1,025,699 | 242,891 | 254,963 | 497,854 |
| Average per day (Bbls) | 10,639 | 10,909 | 11,890 | 11,397 | 7,835 | 8,792 | 8,162 |
| Average realized price per Bbl | $73.03 | $70.87 | $66.90 | 70.27 | $76.54 | $70.25 | $73.40 |
| Gas: |  |  |  |  |  |  |  |
| Total gas sales (Mcf) | 1,558,623 | 1,544,685 | 1,775,871 | 4,879,179 | 1,395,453 | 1,496,656 | 2,892,109 |
| Average per day (Mcf) | 50,278 | 51,490 | 57,286 | 54,213 | 45,015 | 51,609 | 47,412 |
| Average realized price per Mcf | $3.03 | $2.71 | $1.61 | $2.41 | $1.55 | $2.10 | $1.83 |

| Royalties | Texas Royalty Properties 2025 April | May | June | Total | 2024 April | May | June | Total |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Oil sales (Bbls) | 15,292 | 13,619 | 14,430 | 43,341 | 15,152 | 14,569 | 14,339 | 44,060 |
| Gas sales (Mcf) | 8,991 | 9,894 | 8,278 | 27,163 | 8,744 | 6,865 | 6,173 | 21,782 |
| **Properties From Which The Royalties Were Carved:** |  |  |  |  |  |  |  |  |
| Oil: |  |  |  |  |  |  |  |  |
| Total oil sales (Bbls) | 17,157 | 15,442 | 16,367 | 48,966 | 17,006 | 16,335 | 16,053 | 49,394 |
| Average per day (Bbls) | 572 | 498 | 546 | 544 | 567 | 527 | 535 | 543 |
| Average realized price per Bbl | $71.97 | $68.39 | $65.46 | 68.61 | $73.77 | $78.00 | $82.22 | 78.00 |
| Gas: |  |  |  |  |  |  |  |  |
| Total gas sales (Mcf) | 10,093 | 11,198 | 9,392 | 30,683 | 9,815 | 7,699 | 6,912 | 24,426 |
| Average per day (Mcf) | 336 | 361 | 313 | 341 | 327 | 248 | 230 | 268 |
| Average realized price per Mcf | $11.54 | $9.42 | $9.48 | $10.15 | $8.76 | $11.16 | $10.63 | $10.04 |

### Pricing and Production Discussion

For the Waddell Ranch properties, the average realized price of oil decreased to $70.27 per Bbl for the production months of January through March 2025 compared to $73.40 per Bbl for February and March of 2024 due to worldwide market variables. The average realized price of gas increased to $2.41 per Mcf for the production months of January through March 2025 from $1.83 per Mcf for the production months of February and March of 2024.

For the Texas Royalty properties, the average realized price of oil decreased to $68.61 per Bbl in the second quarter of 2025, compared to $78.00 per Bbl in the second quarter of 2024 due to worldwide market variables. The average realized price of gas (including natural gas liquids) for the Texas Royalty properties increased from $10.04 per Mcf in the second quarter of 2024 to $10.15 per Mcf in the second quarter of 2025 in part due to change in overall market variables.

Since the oil and gas sales attributable to the Royalties are based on an allocation formula that is dependent on such factors as price and cost (including capital expenditures), the production amounts in the Royalties section of the above table do not always provide a meaningful comparison. However, for the Texas Royalty properties, oil volumes slightly decreased and gas volumes increased from the Underlying Properties for the applicable period in 2025 compared to 2024, while for the Waddell Ranch properties, oil volumes and natural gas volumes (including plant products) increased for the applicable period in 2025 compared to 2024.

### Blackbeard Capital Expense Discussion

Blackbeard advised the Trustee that capital expenditures for drilling, remedial and maintenance activities on the Waddell Ranch properties during the second quarter of 2025 totaled $61.3 million (gross) as compared to $15.6 million (gross) for the second quarter of 2024. The three months ended June 30, 2025, for the Waddell Ranch properties includes January through March 2025 expenditures, whereas the three months ended June 30, 2024 includes April and May 2024 expenditures only. Blackbeard has not provided updated 2025 capital expenditures budget information.

Development information for the Waddell Ranch properties such as well completions, workovers, remedial activities, and plugging and abandonment, was not provided by Blackbeard. This information has previously been provided monthly since Argent Trust Company has become Trustee of the Trust until May 2024.

Blackbeard advised the Trustee that lease operating expenses and property taxes totaled $19.8 million (gross) for the second quarter of 2025, compared to $14.7 million (gross) for the same period in 2024 on the Waddell Ranch properties. The quarter ended June 30, 2025, for the Waddell Ranch properties includes January through March 2025 expenditures, whereas the three months ended June 30, 2024 includes April and May 2024 expenditures only.

### Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

For the six months ended June 30, 2025, royalty income received by the Trust amounted to $6,144,586 compared to royalty income of $14,809,031 for the six months ended June 30, 2024. Due to Blackbeard refusing to provide the Trustee information necessary to calculate the net proceeds as of the NYSE notification date beginning May 2024, pricing information for the Waddell Ranch properties is for the six month period of December 2024 through May 2025 (reflecting the period for which proceeds would have been distributed to Unitholders in the first six months of 2025). The average realized oil and gas prices for the Waddell Ranch properties were $69.55 per Bbl and $2.06 per Mcf, respectively for the six months ended June 30, 2025 compared to $74.75 per Bbl and $1.87 per Mcf for the six months ended June 30, 2024. For the Texas Royalty properties, the average realized oil and gas prices were $68.78 per Bbl and $9.36 per Mcf, respectively for the six months ended June 30, 2025 compared to $76.53 per Bbl and $9.35 per Mcf, respectively for the six months ended June 30, 2024. The decrease in royalty income reported in the six months ended June 30, 2025 compared to the six months ended June 30, 2024 is attributable to the deficit position of the Waddell Ranch properties due to an excess in working interest costs during the first six months of 2025. No deficit position existed during the first six months of 2024 and royalty income was received from the Waddell Ranch properties for the months of January through May of 2024.

Interest income for the six months ended June 30, 2025, was $32,274 compared to $68,153 during the six months ended June 30, 2024. The decrease in interest income is primarily attributable to a decrease in the amounts of funds available for investment and the length of time of such investment. Total expenses during the six months ended June 30, 2025, amounted to $1,183,393 compared to $948,290 during the six months ended June 30, 2024. The increase in total expenses can be primarily attributed to increased expenses for professional services associated with legal proceedings with Blackbeard.

These transactions resulted in distributable income for the six months ended June 30, 2025 of $4,993,467, or $0.11 per Unit. For the six months ended June 30, 2024, distributable income was $13,928,894 or $0.30 per Unit.

Notwithstanding requests from the Trustee to Blackbeard, the operator of the Waddell Ranch properties, Blackbeard has refused to provide the Trustee information necessary to calculate the net proceeds as of the NYSE notification date beginning May 2024 such that royalty income for the Trust for the first six months of the calendar year is associated with actual oil and gas production for October 2024 through March 2025 for the Waddell Ranch properties from which "Royalties" were carved. Royalty income for the Trust for the first six months of the calendar year for the Texas Royalty properties is associated with actual oil and gas production from November 2024 through April 2025.

Beginning in May 2024, Blackbeard has also refused to provide production, product sales, capital expenditure, and development information for the Waddell Ranch properties from which the Trust's Royalties are carved for each distribution month, information Blackbeard has previously provided on a monthly basis since Argent Trust Company has become Trustee of the Trust. Blackbeard has opted to provide this information quarterly, approximately 30 days after the end of each fiscal quarter. On July 30, 2025, Blackbeard provided the Trustee a quarterly statement showing the production volumes and computation of net proceeds to the Trust for each month of the quarter ended June 30, 2025. Oil and gas sales attributable to the Royalties and the properties from which the Royalties were carved are as follows:

| Royalties | For the Six Months Ended June 30, 2025 WADDELL RANCH PROPERTIES(1) | TEXAS ROYALTY PROPERTIES | 2024 WADDELL RANCH PROPERTIES | TEXAS ROYALTY PROPERTIES |
| --- | ---: | ---: | ---: | ---: |
| Oil sales (Bbls) | 1,397,075 | 86,681 | 935,368 | 89,038 |
| Gas sales (Mcf) | 7,065,970 | 53,612 | 5,373,315 | 43,600 |
| **Properties From Which The Royalties Were Carved:** |  |  |  |  |
| Oil: |  |  |  |  |
| Total oil sales (Bbls) | 1,862,767 | 97,951 | 1,247,157 | 99,898 |
| Average per day (Bbls) | 10,235 | 541 | 8,205 | 549 |
| Average price per Bbl | $69.55 | $68.78 | 74.75 | $76.53 |
| Gas: |  |  |  |  |
| Total gas sales (Mcf) | 9,421,293 | 60,596 | 7,164,420 | 48,879 |
| Average per day (Mcf) | 51,765 | 335 | 47,134 | 269 |
| Average price per Mcf | $2.06 | $9.36 | $1.87 | $9.35 |

(1) Due to the timing of information received from Blackbeard, information reflects Royalty income received by the Trust during the six-month period of December 2024 through May 2025. See Note 2 to the Condensed Financial Statements.

### Pricing and Production Discussion

Production and pricing information for the Waddell Ranch properties is shown for the months of December 2024 through May 2025. The average realized price of oil decreased to $69.55 per Bbl for December 2024 through May 2025 compared to $74.75 per Bbl for the five month period ended May 31, 2024 due to worldwide market variables. The average realized price of gas for the six months ended May 31, 2025, was $2.06 per Mcf an increase from $1.87 for the five month period ending May 31, 2024.

For the Texas Royalty properties, the average realized price of oil decreased to $68.78 per Bbl for the six months ended June 30, 2025, compared to $76.53 per Bbl for the same period of 2024 due to worldwide market variables. The average realized price of gas (including natural gas liquids) for the Texas Royalty properties increased from $9.35 per Mcf in the six months ended June 30, 2024 to $9.36 per Mcf in the same period of 2025 due to change in overall market variables.

Since the oil and gas sales attributable to the Royalties are based on an allocation formula that is dependent on such factors as price and cost (including capital expenditures), the production amounts in the Royalties section of the above table do not provide a meaningful comparison. However, for the Texas Royalty properties, oil sales volumes decreased slightly and gas sales volumes increased for the properties from which the Royalties are carved for the applicable period of 2025 compared to 2024, while for the Waddell Ranch properties, oil and natural gas volumes (including plant products) increased for the applicable period in 2025 compared to 2024.

### Blackbeard Capital Expense Discussion

Capital expenditures for drilling, remedial and maintenance activities on the Waddell Ranch properties for the six months ended June 30, 2025 totaled $109.2 million (gross). For the six months ended June 30, 2024, capital expenditures were $43.9 million (gross) to the Trust. The six months ended June 30, 2025 for the Waddell Ranch properties includes December 2024 through May 2025 expenditures and the six months ended June 30, 2024 include the five months of January through May 2024.

Development information for the Waddell Ranch properties, such as well activity, completions, workovers, remedial activities, and plugging and abandonment, was not provided by Blackbeard. This information has previously been provided on a monthly basis since Argent Trust Company has become Trustee of the Trust until May 2024.

Lease operating expenses and property taxes totaled $41.2 million (gross) for the six months ended June 30, 2025, compared to $37.5 million (gross) for the same period in 2024. The six months ended June 30, 2025, for the Waddell Ranch properties only includes December 2024 through May 2025 expenses and taxes and the 2024 expenses and taxes include the months of January through May 2024.

### Calculation of Royalty Income

The Trust’s royalty income is computed as a percentage of the net profit from the operation of the properties in which the Trust owns net overriding royalty interests. The royalty income received and recorded by the Trust was determined by the operator as noted below. These percentages of net profits are 75% and 95% in the case of the Waddell Ranch properties and the Texas Royalty properties, respectively. Royalty income received and available for distribution by the Trust for the three months ended June 30, 2025 and 2024, respectively, was computed as shown in the table below:

| Gross proceeds of sales from the Underlying Properties | Three Months Ended June 30, 2025 WADDELL RANCH PROPERTIES (1) | TEXAS ROYALTY PROPERTIES | 2024 WADDELL RANCH PROPERTIES | TEXAS ROYALTY PROPERTIES |
| --- | ---: | ---: | ---: | ---: |
| Oil proceeds | $71,937,685 | $3,362,228 | $38,486,468 | $3,848,548 |
| Gas proceeds | 11,755,670 | 310,899 | 4,811,189 | 245,355 |
| Total | 83,693,355 | 3,673,127 | 43,297,657 | 4,093,903 |
| Less: |  |  |  |  |
| Severance tax: |  |  |  |  |
| Oil | 3,315,545 | 137,047 | 1,749,807 | 148,632 |
| Gas | 219,485 | 11,380 | 52,354 | 9,991 |
| Gathering and Transportation Costs | 8,013,849 | 32,185 | 4,178,629 | 37,642 |
| Lease operating expense and property tax: |  |  |  |  |
| Oil and gas | 19,815,512 | 240,000 | 14,661,781 | 240,000 |
| Capital expenditures | 61,280,461 | — | 15,550,243 | — |
| Total | 92,644,852 | 420,612 | 36,192,814 | 436,265 |
| Net profits | (8,951,497) | 3,252,515 | 7,104,843 | 3,657,638 |
| Net overriding royalty interests | 75% | 95% | 75% | 95% |
| Royalty income | $(6,713,623) | 3,089,889 | $5,328,632 | 3,474,756 |

(1) Due to an NPI deficit, the Waddell Ranch properties did not contribute to royalty income from November 2024 through June 2025.

### Critical Accounting Policies and Estimates

A disclosure of critical accounting policies and the more significant judgments and estimates used in the preparation of the Trust’s financial statements is included in Item 7 of the Trust’s Annual Report on Form 10-K for the year ended December 31, 2024. There have been no significant changes to the critical accounting policies during the six months ended June 30, 2025.

### Distributable Income Per Unit

Basic distributable income per Unit is computed by dividing distributable income by the weighted average of Units outstanding. Distributable income per Unit assuming dilution is computed by dividing distributable income by the weighted average number of Units and equivalent Units outstanding. The Trust had no equivalent Units outstanding for any period presented. Therefore, basic distributable income per Unit and distributable income per Unit assuming dilution are the same.

### New Accounting Pronouncements

There are no new accounting pronouncements that are expected to have significant impact on the Trust’s financial statements.

## Market risk

As filed, 1,077 characters.

The Trust is a passive entity and other than the Trust’s ability to periodically borrow money as necessary to pay expenses, liabilities and obligations of the Trust that cannot be paid out of cash held by the Trust, the Trust is prohibited from engaging in borrowing transactions. The amount of any such borrowings is unlikely to be material to the Trust. The Trust periodically holds short-term investments acquired with funds held by the Trust pending distribution to Unitholders and funds held in reserve for the payment of Trust expenses and liabilities. Because of the short-term nature of these borrowings and investments and certain limitations upon the types of such investments which may be held by the Trust, the Trustee believes that the Trust is not subject to any material interest rate risk. The Trust does not engage in transactions in foreign currencies which could expose the Trust or Unitholders to any foreign currency related market risk. The Trust invests in no derivative financial instruments and has no foreign operations or long- term debt instruments.

## Controls and procedures

As filed, 1,749 characters.

On May 14, 2013, the Committee of Sponsoring Organizations of the Treadway Commission issued an updated version of its Internal Control – Integrated Framework (the “2013 Framework”) which helps organizations design, implement and evaluate the effectiveness of internal control concepts and simplify their use and application. As of the end of the period covered by this report, the Trustee carried out an evaluation of the effectiveness of the design and operation of the Trust’s disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15 based on the criteria established in the 2013 Framework. Based upon that evaluation, the Trustee concluded that the Trust’s disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Trust in the reports that it files or submits under the Securities

Exchange Act of 1934 and are effective in ensuring that information required to be disclosed by the Trust in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the Trustee to allow timely decisions regarding required disclosure. In its evaluation of disclosure controls and procedures, the Trustee has relied, to the extent considered reasonable, on information provided by Blackbeard, the owner of the Waddell Ranch properties, and Riverhill Energy Corporation, the owner of the Texas Royalty properties.

There has not been any change in the Trust’s internal control over financial reporting during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.

## Risk factors

As filed, 314 characters.

Risk factors relating to the Trust are contained in Item 1A of the Trust's Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Except as set forth in such filing, no material change to such risk factors has occurred during the six months ended June 30, 2025.

Items 2 through 4

Not applicable.

Filed Aug 13, 2025.
Source: SEC EDGAR, the filing index for accession 0000950170-25-107874. Last ingested by Listed: Oct 24, 2026, 14:56 ET. No prices; not investment advice.