Freeport-McMoRan Oil and Gas Royalty Trust Makes Announcement
HOUSTON--(BUSINESS WIRE)--June 10, 1999--Freeport-McMoRan Oil and Gas Royalty Trust (NYSE:FMR) announced that for the month of April 1999 the Trust's Class A Costs exceeded Gross Proceeds by $679,079. Because of the Class A cost carry-forward there will be no distribution for the month of May 1999. In addition, net current month Trust administrative expenses of $17,013 were paid from the Trust administrative expense reserve resulting in approximately $1.1 million remaining in the expense reserve.
For the month, Gross Proceeds included oil and condensate revenues of approximately $0.3 million from March 1999 production of 26,320 barrels and gas revenues of approximately $0.3 million from February 1999 production of 117,646 mcf, respectively, net to the Trust's interest. Class A costs included $0.6 million in recompletion cost and capital costs for completed AFE's, and $0.6 million in operating and transportation costs, net to the Trust's interest, both primarily for West Cameron Block 498. The Working Interest Owner is entitled to recoup the cumulative carry-forward from future Gross Proceeds prior to making royalty payments to the Trust.
Pursuant to section 6.02 of the Overriding Royalty Conveyance IMC Global, Inc., (Working Interest Owner) during the month of May 1999 assigned its working interest in West Cameron Block 215, Vermilion Block 58 and Breton sound Blocks 54/55 to the operator Amerada Hess, Corporation. No consideration was paid to the Working Interest Owner and Amerada Hess assumed all future liabilities relating to the leases. Subsequently, Amerada Hess resolved outstanding gas imbalances with the Working Interest Owner. The total volume due to Working Interest Owner was approximately 1.2 BCF. The Working Interest Owner received approximately $1.7 million for the gas imbalance. These transactions will be reflected in the appropriate month's Statement of Computation of Net Proceeds Payable to the Royalty Trust. The Working Interest Owner is evaluating the amount, if any, of previously withheld abandonment costs associated with these properties. Such amounts will reduce the Class A cost carry-forward.
The lawsuit with IMC Global, Inc. is currently in the mid-discovery phase. |
