Financial Performance - The average daily closing WTI price was below the "break-even" price for the quarter ended March 31, 2023, resulting in no Royalty Payments for that quarter [40]. - For the three months ended March 31, 2023, Royalty revenues decreased by 48.1% to $6,640,000 compared to $12,801,000 in the same period of 2022 [53]. - Royalty revenues, cash earnings, and cash distributions decreased for Q1 2023 compared to Q1 2022 due to increased Adjusted Chargeable Costs and a decline in average net production [86]. - The average WTI price for the first quarter of 2023 was $76.17, while the average Adjusted Chargeable Costs were $80.50, resulting in a negative average Per Barrel Royalty of $(7.00) [66]. - The average WTI Price for Q4 2022 was above the break-even level necessary for the Trust to receive a Per Barrel Royalty, with fluctuations between $71.02 and $92.64 per barrel [75]. Production and Costs - Average net production for the three months ended March 31, 2023, was 70.2 mb/d, a decrease of 1.7% from 71.4 mb/d in the same period of 2022 [51]. - Adjusted Chargeable Costs increased by 17.2% from $29.25 in 2021 to $32.00 in 2022, contributing to a decrease in the Average Per Barrel Royalty paid [80]. - The average net production from the 1989 Working Interest declined by 1.7% between the reporting periods, attributed to the naturally declining production rate from the Prudhoe Bay field [80]. Administrative and Financial Management - The Trust's Administrative Expenses for the three months ended March 31, 2023, were $280,000, a decrease of 23.1% from $364,000 in the same period of 2022 [53]. - The Trust's liquidity is primarily dependent on revenues from the Royalty Interest, with no other significant sources of capital [69]. - The Trust's cash reserve was evaluated to ensure it can cover Administrative Expenses for a two-year period if net revenues fall below $1.0 million per year [45]. - The Trustee continues to assess the adequacy of the cash reserve and may adjust it based on future revenue expectations and expenses [65]. - The Trust's cash reserve was increased to $6.0 million, fully funded from Royalty Payments attributable to the third quarter of 2021 [71]. - Accrued expenses increased from $280 thousand at the end of 2022 to $587 thousand by March 31, 2023 [98]. Asset Management - The Trust's total assets as of March 31, 2023, were $6.065 million, slightly down from $6.067 million at the end of 2022 [98]. - The Trust's internal control over financial reporting was evaluated as effective as of March 31, 2023 [105]. Market Outlook - The U.S. Energy Information Administration forecasts WTI prices to average approximately $72.50 per barrel in Q2 2023 and $73.00 per barrel in Q3 2023 [76]. - No future outlook or performance guidance mentioned [120]. Other Information - The quarterly distribution received in January 2023 was adjusted to compensate for underpayment of royalties from the previous quarter [104]. - The Trust received no revenues from the Royalty Interest for four quarters of 2020 and the first quarter of 2021 due to lower oil prices and increased Chargeable Costs [44]. - No financial performance summary or user data provided in the documents [116]. - No new products or technologies discussed [120]. - No market expansion or acquisition strategies outlined [120]. - No additional strategies or risk factors identified [120].
BP Prudhoe Bay Royalty Trust(BPT) - 2023 Q1 - Quarterly Report