Permian Basin Royalty Trust(PBT) - 2022 Q4 - Annual Report

Revenue and Income - Total revenue for the Trust in 2022 was $54,417,857, a significant increase from $11,805,514 in 2021, representing a growth of approximately 360%[167] - Distributable income for 2022 was $53,543,824, or $1.15 per Unit, compared to $10,721,775, or $0.23 per Unit in 2021[180] - Royalty income for the year ended December 31, 2022, was $54,417,857, significantly higher than $11,805,514 in 2021, indicating an increase of approximately 360%[212] - Distributable income for 2022 was $53,543,824, compared to $10,721,775 in 2021, reflecting an increase of about 400%[212] - The distribution payable to unit holders as of December 31, 2022, was $1,755,444, up from $1,148,527 in 2021, marking a rise of approximately 53%[210] - The total distributable income for 2022 was $54,417,857,000, with a distribution per unit of $1.15, compared to $11,805,514,000 and $0.230042 per unit in 2021[261] Oil and Gas Sales - Oil revenue accounted for $41,357,571 in 2022, which is 76% of total revenue, compared to 81% in 2021[167] - Gas revenue increased to $13,060,286 in 2022, making up 24% of total revenue, up from 19% in 2021[167] - Total oil sales for 2022 were 2,297,565 barrels, an increase of approximately 84% from 2021, while total gas sales reached 12,587,044 Mcf, a 145% increase[170] - The average price of oil rose to $94.11 per barrel in 2022, up from $63.34 in 2021, while the average price of gas increased to $5.54 per Mcf from $3.53[167] Assets and Expenditures - As of December 31, 2022, total assets of the Trust amounted to $3,134,877, an increase from $2,601,215 in 2021, representing a growth of approximately 20.5%[210] - Capital expenditures in 2022 were approximately $124.3 million, significantly higher than $66.6 million in 2021 and $10.3 million in 2020[171] - Lease operating expenses and property taxes for 2022 totaled approximately $43.7 million, up from $23 million in 2021[176] - The Trust's total expenditures for 2022 were $922,404, a decrease from $1,088,851 in 2021, showing a reduction of approximately 15%[212] Reserves and Future Cash Flows - As of December 31, 2022, proved oil reserves increased to 11,553 thousand barrels and proved gas reserves increased to 25,737 thousand Mcf[256] - Proved developed reserves of oil were 8,022 thousand barrels and gas were 21,216 thousand Mcf as of December 31, 2022[256] - The standardized measure of discounted future net cash inflows as of December 31, 2022, is $686,467,000, a significant increase from $259,856,000 in 2021 and $80,091,000 in 2020[260] - Future net cash inflows for 2022 totaled $1,205,227,000, compared to $465,149,000 in 2021 and $170,446,000 in 2020, indicating strong growth[260] - The Trust experienced extensions, discoveries, and other additions amounting to $201,239,000 in 2022, up from $51,245,000 in 2021[260] Financial Management and Risks - The Trust has no material interest rate risk due to its short-term nature of investments and lack of long-term debt instruments[197] - The Trust does not engage in foreign currency transactions, thus avoiding exposure to foreign currency-related market risks[197] - There are no new accounting pronouncements expected to significantly impact the Trust's financial statements[196] - Contingencies related to Underlying Properties could reduce future royalty income payments and cash distributions to Unit holders[231] - The Trust is classified as a grantor trust for federal income tax purposes, meaning Unit holders are taxed directly on their proportionate share of income[237] Cash Flow and Distributions - The Trust's cash and short-term investments increased to $2,855,444 in 2022 from $2,248,527 in 2021, representing a growth of about 27%[210] - The Trust declared distributions of $0.036797 per unit for January 2023 and $0.041356 per unit for February 2023, reflecting ongoing cash flow generation[266] - Monthly Distribution Amounts are determined based on cash received, liabilities paid, and cash reserves, with negative amounts carried forward[234] Valuation Adjustments - The accretion of discount for 2022 was $25,986,000, compared to $8,009,000 in 2021, indicating a positive trend in the valuation of future cash flows[260] - Revisions of previous estimates and other adjustments contributed $253,804,000 to the standardized measure in 2022, highlighting the dynamic nature of reserve valuations[260]