Mesa Royalty Trust, established on November 1, 1979, reported significant declines in both revenue and profitability for the three and nine months ended September 30, 2024, compared to the same periods in 2023. The Trust's distributable income for Q3 2024 was $54,942, a sharp decrease from $283,672 in Q3 2023. For the nine-month period, distributable income fell to $400,622 from $2,606,218 in the prior year. This decline is attributed to lower royalty income, which dropped to $63,966 in Q3 2024 from $357,474 in Q3 2023, and to $552,994 for the nine months ended September 30, 2024, down from $2,982,346 in the same period of 2023.

The Trust's total assets decreased to $3,157,006 as of September 30, 2024, from $3,407,466 at the end of 2023. Cash and short-term investments also declined to $1,878,107 from $2,096,773. Distributions payable to unitholders fell dramatically to $10,314 from $214,941, reflecting the Trust's reduced income.

Royalty income from the San Juan Basin—New Mexico Properties was particularly impacted, decreasing by $2,364,270 to $552,994 for the nine months ended September 30, 2024. This decline was driven by lower pricing for natural gas and natural gas liquids, decreased production volumes, and increased capital and operating expenses. The average sales price for natural gas dropped to $3.05 from $4.12 year-over-year.

Excess production costs have also risen significantly, totaling $577,655 as of September 30, 2024, compared to $260,731 at the end of 2023. The Trust's Contingent Reserve balance increased to $1,867,792 from $1,644,560, with plans to raise it to $2.0 million, which will further reduce net proceeds available for distribution.

Operating costs for the nine months ended September 30, 2024, were $1,302,531, a slight decrease from $1,315,846 in the previous year. Capital expenditures increased to $90,018, up from $50,891, attributed to a general increase in activity and more recomplete projects.

The Trust's financial performance reflects the challenges faced in the oil and gas sector, including fluctuating prices and production levels, which have significantly impacted its revenue and distributions to unitholders.