Permian Basin Royalty Trust (PBT) declares $0.024673 distribution; Waddell Ranch in cost position

Permian Basin Royalty Trust declared a monthly cash distribution to its unitholders of $0.024673 per unit, payable on July 15, 2026, to those holding units as of June 30.

The distribution increased from the previous month, driven primarily by higher oil volumes and improved oil and natural gas prices from the trust's Texas Royalty Properties. During May, the underlying Texas properties generated oil and gas revenues totaling $1,503,687, resulting in net profit of $1,353,613 after deducting taxes and expenses. With the trust's 95% net profits interest in these properties, this contributed $1,285,932 to the month's distribution.

Waddell Ranch in Excess Cost Position

However, the Waddell Ranch properties contributed nothing to the June distribution. According to the filing, production costs for Waddell Ranch exceeded gross proceeds in May 2026, placing the properties in what the trust calls an "excess cost position." When costs exceed revenue in a given month, the net profits interest (the trust's share of profits from the properties) generates no distribution, and accumulated excess costs must be recovered by future revenues before distributions resume.

The trust operates Waddell Ranch through an operator called Blackbeard Operating, LLC. The operator provides production and cost information quarterly rather than monthly, meaning detailed Waddell Ranch data will appear only in the trust's quarterly and annual reports going forward.

The June distribution of $0.024673 per unit was paid on 46,608,796 units outstanding.

Proposed SoftVest Business Combination

The press release also disclosed an update on a proposed business combination involving the trust. In May 2026, SoftVest, L.P., a significant unitholder, filed a Schedule 13D (a regulatory document disclosing major shareholding activity) with the Securities and Exchange Commission outlining preliminary discussions with Blackbeard Holdings, LLC regarding a potential merger.

Under the non-binding term sheet described in the filing, a new public company would be formed to acquire all assets and operations of the current trust, along with certain properties controlled by Blackbeard Holdings. This would include approximately 66,500 acres of surface estate and a 15% royalty interest from US Land Guild, LLC, a subsidiary of Blackbeard Holdings. Blackbeard Holdings would also potentially receive certain working interests held by the trust.

The trust and its trustee, Argent Trust Company, emphasized they have not participated in negotiating these proposals and are providing the information solely for unitholders' awareness. Any such business combination would require approval by a majority of trust unitholders.

Market Context

The trust noted that worldwide market conditions continue to affect the pricing of domestic oil and gas production, making it difficult to predict the impact on future distributions.