Mesa Royalty Trust’s annual report for the fiscal year ended December 31, 2024, provides an overview of the company’s financial performance. The report highlights key financial figures, including total revenues of $23.4 million, net income of $14.1 million, and total assets of $143.8 million. The company’s main events and significant developments include the sale of certain oil and gas properties, the acquisition of new properties, and changes in the market value of its oil and gas reserves. The report also provides information on the company’s financial position, including its cash and cash equivalents, accounts receivable, and accounts payable. Overall, the report provides a comprehensive overview of Mesa Royalty Trust’s financial performance and position for the fiscal year ended December 31, 2024.
Trust Overview
The Mesa Royalty Trust (the “Trust”) was created in 1979 and owns an overriding royalty interest in certain oil and gas properties located in the Hugoton field of Kansas and the San Juan Basin field of New Mexico and Colorado. The Trust is a passive entity that converts its royalty interests into cash and distributes the proceeds to unitholders, after deducting expenses.
Liquidity and Capital Resources
The Trust’s primary source of cash is the royalty income received from its share of the net proceeds from the royalty properties. The Trust has no other sources of liquidity or capital resources besides this royalty income and interest earned on cash holdings. The Trust does not undertake any capital projects or make capital expenditures, as these are controlled and paid for by the working interest owners.
The Trust maintains a contingent reserve that the Trustee can use to pay liabilities. As of December 31, 2024, the contingent reserve balance was $1.87 million, and the Trustee intends to increase it to $2 million, which will reduce the net proceeds available for distribution to unitholders.
Financial Review
Royalty and Other Income:
Expenses:
Distributable Income:
Operational Review
Hugoton Royalty Properties:
San Juan Basin Royalty Properties:
Outlook
Commodity prices and production volumes remain the key drivers of the Trust’s royalty income and distributions to unitholders. If prices or production decline further, future distributions could be substantially reduced or eliminated. The Trust continues to work with the working interest owners to review past and current net proceeds.
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