LL&E ROYALTY TRUST ANNOUNCES MARCH DISTRIBUTION
LL&E ROYALTY TRUST ANNOUNCES MARCH DISTRIBUTION HOUSTON, Feb. 25 /PRNewswire/ -- LL&E Royalty Trust (NYSE: LRT)
announced today that its monthly distribution to unitholders will be made on or before March 16, 1992 to unitholders of record on March 5, 1992. This distribution represents amounts payable to the trust with respect to production for the month of December 1991.
The total amount of the March distribution will be $123,253 or approximately $.00649 per unit. This distribution reflects payment of accrued administrative expenses which amounted to $186,330. Excess production costs amounting to approximately $1,800,000 associated with Jay Field were recouped in the current month, with resulting net proceeds of approximately $292,000. (The trust's interest is equivalent to 50 percent of the net proceeds from Jay Field.) Commencing with the August distribution month, the working interest owner began escrowing funds for the estimated cost of dismantlement of platforms in the Offshore Louisiana property. The working interest owner's estimate of total dismantlement costs for Offshore Louisiana is $2,500,000. The total amount of the escrow for the March distribution and the cumulative balance of the escrow are $267,000 and $1,600,000, respectively. (The trust's interest is equivalent to 90 percent of the net proceeds from Offshore Louisiana.) Future distributions, if any, from Offshore Louisiana will only be resumed after estimated dismantlement costs have been fully escrowed. A platform is to be placed on South Pass Block 86 (in which the trust has no interest) which will produce oil and gas from a reservoir underlying both South Pass Block 86 and South Pass Block 89. The remaining estimated total cost of the platform to be allocated to South Pass Block 89 is approximately $2.1 million. (The trust's interest is equivalent to 50 percent of the net proceeds from South Pass Block 89.) The remaining platform costs and the costs of drilling additional wells will adversely affect revenues to the trust from
South Pass Block 89 for several months. However, the timing of the occurrence of the platform costs is not within the control of the working interest owner, and the working interest owner is unable to predict the timing of such costs.
As previously announced, the working interest owner continues to escrow amounts from the Fort Worth Basin property in connection with the issue of recapture of intangible drilling and development costs under Section 1254 of the Internal Revenue Code. The total amount escrowed from the March distribution and the cumulative balance of the escrow are $11,000 and $691,000, respectively. (The trust's interest is equivalent to 90 percent of the net proceeds from Fort Worth Basin.) Pending the possible appeal by the IRS of the previously announced favorable ruling rendered by the United States Tax Court of the Section 1254 issue, the working interest owner has advised the trustee that it intends to continue escrowing all net proceeds from Fort Worth Basin. The working interest owner intends to closely monitor each of the aforementioned properties with respect to possible changes in its estimates of relevant factors. The extent of future distributions from Jay Field and South Pass Block 89 will be dependent on normal factors associated with oil and gas operations such as oil and gas production levels and prices, and the timing of capital requirements for the platform and remaining wells to be drilled at South Pass Block 89. The working interest owner also intends to continue to monitor the Section 1254 recapture issue, for which it has determined it is eligible to escrow funds from all trust properties. It has advised the trustee that it does not intend to exercise its rights to escrow funds, other than for Fort Worth Basin, for this issue for the current period. -0- 2/25/92 /CONTACT: Roark Ashie of First City, Texas-Houston, N.A., as trustee, 713-658-7639/ (LRT) CO: LL&E Royalty Trust ST: Texas IN: OIL SU: DIV SM -- NY056 -- 2381 02/25/92 13:11 EST
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|Date:||Feb 25, 1992|
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