Monitor monthly press releases for progress on reducing the $9.3M net excess production cost deficit. At the current burn rate of ~$100K/month deficit reduction, it will take many months before distributions resume. The ongoing audit of Hilcorp's accounting could alter the deficit trajectory if cost adjustments are found.
Price Chart
Executive Summary
San Juan Basin Royalty Trust declared no cash distribution for October 2026, marking the third consecutive month with no payout. The trust remains in a deficit position with $9.3M net excess production costs from Hilcorp's 2024 well drilling, and distributions will not resume until that deficit, a $2M reserve, and a $1.16M line of credit are fully repaid.
Key Financial Metrics
Key Facts
- No monthly cash distribution declared for October 2026 due to excess production costs and low natural gas pricing.
- Cumulative excess production costs balance is approximately $12,423,018 gross ($9,317,264 net to the Trust).
- Deficit decreased by $130,448 gross ($97,836 net) from last month's reporting period.
- Hilcorp reported $4,868,781 total revenue from Subject Interests for August 2026 production month.
- Production costs (excluding excess) were $4,738,333 for August 2026.
- Average gas price for August 2026 was $2.28 per Mcf ($2.05 per MMBtu), up $0.27 per Mcf from July 2026.
- Gas volumes for August 2026 totaled 2,057,618 Mcf, slightly above July 2026 volumes of 2,046,556 Mcf.
- Outstanding principal balance on Line of Credit will reach $1,155,501 after October administrative expenses.
- Trust administrative expenses for the month were $80,118.
- Cash reserves remain unchanged at $3,891.
- Distributions will not resume until excess costs, $2M reserve, and line of credit are fully repaid.
- This is the third consecutive month with no distribution (August, September, October 2026).
Financial Impact
No distribution for October 2026; $9.3M net deficit must be cleared before distributions resume. Monthly revenue of $4.87M is nearly fully consumed by $4.74M in production costs, leaving minimal proceeds to reduce the deficit.
Risk Factors
- Continued low natural gas pricing could slow deficit reduction and extend the distribution suspension.
- Further excess production costs from Hilcorp operations could increase the deficit.
- Line of credit balance continues to grow ($1.16M), adding interest expense and repayment burden.
- Ongoing audit of Hilcorp could reveal additional costs or adjustments, impacting recovery timeline.
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001193125-26-426824 |
| Document: sjt-ex99_1.htm | 0001193125-26-426824 |
| Document: 0001193125-26-426824-index-headers.html | 0001193125-26-426824 |
| Document: 0001193125-26-426824-index.html | 0001193125-26-426824 |
| Document: 0001193125-26-426824.txt | 0001193125-26-426824 |
| 8-K Data (Synthetic) | 0001193125-26-426824 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 20, 2026 7d ago | 8-K | $3.39 | awaiting T+5 | — | $3.35 (+1.18%) |
Aug 21, 2026 9w ago | 8-K | $2.72 $2.71 | ▲ +0.37% | ▲ +0.84% | $3.35 (−23.16%) |
Jul 21, 2026 14w ago | 8-K | $2.44 $2.54 | ▼ −4.10% | ▼ −5.33% | $3.35 (−37.30%) |
Jun 18, 2026 18w ago | 8-K | $3.11 $2.93 | ▲ +5.79% | ▲ +4.12% | $3.35 (−7.72%) |
May 18, 2026 23w ago | 8-K | $4.28 $4.12 | ▲ +3.74% | ▲ +5.36% | $3.35 (+21.73%) |
Apr 20, 2026 27w ago | 8-K | $4.54 $4.22 | ▲ +7.05% | ▲ +7.96% | $3.35 (+26.21%) |
US Market Status
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