PermRock Royalty Trust has reported its financial results for the fiscal year ending December 31, 2024, revealing a net profits income of $5.96 million, a decrease from $7.13 million in the previous year. Total revenue for the Trust also fell to $6.02 million, down from $7.19 million in 2023. The decline in revenue is attributed primarily to reduced oil and natural gas sales volumes and prices, reflecting broader market conditions. The average realized price for oil decreased to $75.33 per barrel, while natural gas prices fell to $2.54 per Mcf, contributing to a total distributable income of $5.16 million, compared to $6.26 million in 2023.
In terms of operational metrics, the Trust's underlying properties produced 289,918 barrels of oil and 341,170 Mcf of natural gas during 2024, resulting in a total production of 346.7 MBoe. This represents a decrease in production volumes compared to previous years, which is consistent with the natural decline in production from existing wells. The Trust's operational focus remains on the Permian Basin, where it holds 31,354 gross acres, with significant reserves located in the Permian Clearfork, Abo, Shelf, and Platform areas.
Strategically, the Trust is undergoing a significant transition as Boaz Energy has entered into a Purchase and Sale Agreement with T2S Permian Acquisition II LLC, which is expected to close by the end of March 2025. This agreement involves the sale of Boaz Energy's interests in the underlying properties and its 4,884,861 Trust units. Following the transaction, T2S will assume operational control of the properties, which may lead to changes in operational strategies and capital expenditures.
Looking ahead, Boaz Energy has outlined a capital expenditure budget of $4 million for 2025, focusing on drilling new wells and enhancing waterflood operations. The company plans to drill one new producing well and one injector well in Crane County, Texas, while also investing in workovers and returning shut-in wells to production. However, these plans are subject to modification by the new operator post-transaction, and the Trust's future cash distributions will depend heavily on the success of these initiatives and prevailing market conditions.
Overall, the Trust's financial performance reflects the challenges faced in the current energy market, with lower production volumes and prices impacting revenue. The upcoming transition in operational management and strategic focus on capital investments will be critical in determining the Trust's ability to recover and enhance its profitability in the coming years.
About PermRock Royalty Trust
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