VOC Energy Trust (NYSE:VOC) announced the Trust distribution of net
profits for the fourth quarterly payment period ended December 31, 2016
and provided an update on certain operational matters, including VOC
Brazos Energy Partners, L.P.’s (“VOC Brazos”) entrance into a joint
venture with Hawkwood Energy East Texas LLC (“Hawkwood Energy”).
Unitholders of record on January 30, 2017 will receive a distribution
amounting to $1,360,000 or $0.08 per unit, payable February 14, 2017.
Volumes, average sales prices and net profits for the payment period
were:
Sales volumes:
|
|
|
|
Oil (Bbl)
|
|
|
|
135,640
|
|
Natural gas (Mcf)
|
|
|
|
87,594
|
|
Total (BOE)
|
|
|
|
150,239
|
|
Average sales prices:
|
|
|
|
Oil (per Bbl)
|
|
|
$
|
43.01
|
|
Natural gas (per Mcf)
|
|
|
$
|
2.57
|
|
Gross proceeds:
|
|
|
|
Oil sales
|
|
|
$
|
5,833,941
|
|
Natural gas sales
|
|
|
|
224,888
|
|
Total gross proceeds
|
|
|
$
|
6,058,829
|
|
Costs:
|
|
|
|
Lease operating expenses
|
|
|
$
|
2,994,238
|
|
Production and property taxes
|
|
|
|
691,321
|
|
Development expenses
|
|
|
|
473,215
|
|
Total costs
|
|
|
$
|
4,158,774
|
|
Net proceeds
|
|
|
$
|
1,900,055
|
|
Percentage applicable to Trust’s Net Profits Interest
|
|
|
|
80
|
%
|
Net profits interest
|
|
|
$
|
1,520,044
|
|
Increase in cash reserve held by VOC Brazos Energy Partners, L.P.
|
|
|
|
0
|
|
Total cash proceeds available for the Trust
|
|
|
$
|
1,520,044
|
|
Provision for estimated Trust expenses
|
|
|
|
(160,044
|
)
|
Net cash proceeds available for distribution
|
|
|
$
|
1,360,000
|
|
|
|
|
|
|
|
VOC Brazos has reported to the Trustee that it has entered into a joint
venture with Hawkwood Energy to develop the lower EagleBine interval,
also referred to as the Lower Woodbine Organic Shale (“LWOS”), within
the south half of the Kurten Woodbine Unit (the “Contract Area”).
Activity pursuant to the terms of the joint venture would recommence the
horizontal LWOS drilling development program that VOC Brazos previously
reported to the Trustee in December 2014.
Under the terms of the joint venture agreement between VOC Brazos and
Hawkwood Energy, Hawkwood Energy may carry VOC Brazos for its share of
drilling and completion costs for up to four LWOS wells (the “Earning
Wells”), with the first Earning Well to be spud by December 31, 2017 and
the fourth Earning Well to be spud by January 1, 2019. In exchange,
Hawkwood Energy would earn a working interest representing 50% of VOC
Brazos’ interest in each Earning Well and up to a 50% interest in VOC
Brazos’ acreage in the Contract Area. Hawkwood Energy also would have
the right to propose and drill up to eight LWOS wells per year in the
Contract Area after the Earning Wells are completed.
VOC Brazos is evaluating the potential economic benefits associated with
development of the LWOS and pad drilling in the upper EagleBine
interval. If these activities are pursued, with the exception of the
Earning Wells in which Hawkwood Energy would carry VOC Brazos for its
share of drilling and completion costs, such activities would result in
increased development costs burdening the net profits interest of the
Trust relative to historical development costs. As a result of such
increased development costs, cash available for distributions by the
Trust would be temporarily reduced until anticipated production from the
various development efforts in the Kurten Woodbine Unit can be brought
on-line. To address these emerging opportunities, VOC Brazos will
continue to evaluate the appropriate strategy and capital plan to fund
development for the Trust.
This press release contains forward-looking statements. Although VOC
Brazos has advised the Trust that VOC Brazos believes that the
expectations contained in this press release are reasonable, no
assurances can be given that such expectations will prove to be correct.
The announced distributable amount is based on the amount of cash
received or expected to be received by the Trustee from the underlying
properties on or prior to the record date with respect to the quarter
ended December 31, 2016. Any differences in actual cash receipts by the
Trust could affect this distributable amount. Other important factors
that could cause these statements to differ materially include the
actual results of drilling operations, risks inherent in drilling and
production of oil and gas properties, the ability of commodity
purchasers to make payment, and other risk factors described in the
Trust’s Form 10-K for the year ended December 31, 2015 filed with the
Securities and Exchange Commission. Statements made in this press
release are qualified by the cautionary statements made in these risk
factors. The Trust does not intend, and assumes no obligation, to update
any of the statements included in this press release.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170119006036/en/
Copyright Business Wire 2017
Source: Business Wire
(January 19, 2017 - 4:15 PM EST)
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