Chesapeake Granite Wash Trust (NYSE: CHKR) has announced its common unit distribution for the quarter ended June 30, 2013 (which primarily relates to production attributable to the trust’s royalty interests from March 1, 2013 through May 31, 2013) will be $0.6900 per common unit. The trust will also pay a distribution of $0.1432 per subordinated unit for the quarter. The distributions will be paid on August 29, 2013 to all common and subordinated unitholders of record at the close of business on August 19, 2013.
During the three-month production period ended May 31, 2013, total sales volumes and realized oil, natural gas liquids and natural gas prices were lower than initial trust estimates. This resulted in quarterly income available for distribution of $0.5533 per unit, which is $0.1367 below the subordination threshold. As a result, the distribution per common unit is the subordination threshold of $0.6900 for the quarter.
The following table provides sales volumes, realized prices and revenue attributable to the trust’s royalty interests, expenses of the trust and distributable income available to unitholders for the production period from March 1, 2013 through May 31, 2013.
| Sales volumes: | ||||
| Oil (mbbl) | 132 | |||
| Natural gas liquids (mbbl) | 267 | |||
| Natural gas (mmcf) | 2,894 | |||
| Total oil equivalent volumes (mboe) | 881 | |||
| Average price received per production unit:(1) | ||||
| Oil | $ | 88.88 | ||
| Natural gas liquids | $ | 31.42 | ||
| Natural gas | $ | 2.65 | ||
| Distributable income calculation (in thousands except per unit income): | ||||
| Revenue less production taxes(1) | $ | 27,262 | ||
| Derivative settlement loss | (1,053 | ) | ||
| Trust expenses | (342 | ) | ||
| Distributable income available to unitholders | $ | 25,867 | ||
| Calculated distributable income per unit(2) | $ | 0.5533 | ||
| Distributable income per common unit(3) | $ | 0.6900 | ||
| Distributable income per subordinated unit(4) | $ | 0.1432 | ||
(1) Includes the effect of certain marketing, gathering and transportation deductions.
(2) Based on 46,750,000 units issued and outstanding, consisting of 35,062,500 common units and 11,687,500 subordinated units.
(3) Equal to subordination threshold of $0.6900 per common unit.
(4) All subordinated shares are owned by Chesapeake Energy Corporation.
Due to the timing of the payment of production proceeds to the trust, quarterly distributions generally include royalties attributable to sales of oil, natural gas liquids and natural gas for three months, including the first two months of the quarter just ended and the last month of the prior quarter.
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