As of September 30, 2024, BP Prudhoe Bay Royalty Trust reported cash and cash equivalents of $4.3 million, a decrease from $5.3 million at the end of 2023. Total assets also fell to $4.3 million, down from $5.3 million, while total liabilities stood at $156.3 million. The Trust Corpus decreased to $4.1 million from $5.0 million at the end of the previous year, reflecting the issuance of 21.4 million units of beneficial interest.
The Trust experienced significant declines in cash earnings, reporting a loss of $272,000 for the third quarter of 2024, compared to a loss of $86,000 in the same quarter of 2023. For the nine months ended September 30, 2024, cash earnings were a loss of $1.0 million, a stark contrast to cash earnings of $5.8 million for the same period in 2023. The Trust did not distribute any royalty revenues in either Q3 2024 or Q3 2023.
The average WTI crude oil price for the nine-month period increased by 1.5% compared to the previous year, but the Trust's royalty revenues plummeted to $6,640, a decrease of 100% from the same period in 2023. This decline was attributed to lower average net production, which fell by 5.1% due to the natural decline in production rates from the Prudhoe Bay field. Additionally, adjusted chargeable costs rose by 11.6%, influenced by the Consumer Price Index and scheduled increases in costs.
Administrative expenses surged to $329,000 in Q3 2024, an increase of 109.6% from $157,000 in Q3 2023, reflecting higher fees and timing of invoices. The Trust's cash reserve, established to provide liquidity, decreased from $6.0 million to $4.1 million due to the application of reserve funds to cover administrative expenses.
The Trust has not received any royalty payments since the last quarter of 2022, primarily due to declining WTI prices and increased production taxes. The average daily closing WTI price remained below the break-even price for Q3 2024, resulting in no royalty payments for the quarter ended September 30, 2024. The Trust faces potential termination if net revenues from the Royalty Interest do not exceed $1.0 million for the quarter ending December 31, 2024, which would trigger the winding-up process starting January 1, 2025.
About BP PRUDHOE BAY ROYALTY TRUST
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