SandRidge Permian Trust owns royalty interests in specified oil and natural gas properties located in Andrews County, Texas (the ‘Underlying Properties’).
The royalty interests entitle the company to receive 80% of the proceeds (after deducting post-production costs and any applicable taxes) from the sale of oil, natural gas and natural gas liquids (NGL) production attributable to the net revenue interest of it in 517 oil and natural gas wells drilled and completed as of April 1, 2011 on the Un...
SandRidge Permian Trust owns royalty interests in specified oil and natural gas properties located in Andrews County, Texas (the ‘Underlying Properties’).
The royalty interests entitle the company to receive 80% of the proceeds (after deducting post-production costs and any applicable taxes) from the sale of oil, natural gas and natural gas liquids (NGL) production attributable to the net revenue interest of it in 517 oil and natural gas wells drilled and completed as of April 1, 2011 on the Underlying Properties, including 21 wells awaiting completion at that time (the ‘Initial Wells’); and 70% of the proceeds (after deducting post-production costs and any applicable taxes) from the sale of oil, natural gas and NGL production attributable to the net revenue interest in 888 development wells drilled and completed by an affiliate of it pursuant to the terms of a development agreement between the company and SandRidge Energy, Inc. (SandRidge) (the ‘Trust Development Wells’) within an area of mutual interest designated in the development agreement.
In October 2020, Montare Resources I, LLC (Montare) and Avalon entered into a Purchase and Sale Agreement, effective as of September 1, 2020, whereby Avalon sold wells and related assets associated with certain Underlying Properties to Montare, unburdened by the applicable portion of the royalty interests held by the company, in accordance with Avalon’s contractual rights set forth in the Trust Agreement and the Conveyances (the ‘Montare Sale’). As a result of the Montare Sale, the company’s properties consisted of royalty interests in 65 Trust Wells as of December 31, 2020.
Marketing and Customers
Avalon Energy, LLC, Avalon Exploration and Production LLC, and Avalon TX Operating LLC, are collectively referred to as ‘Avalon’. Avalon has the responsibility to market, or cause to be marketed, the oil, natural gas and NGL production attributable to the Underlying Properties.
In 2020, Ace Gathering Inc. (doing business as Ace Energy Solutions) accounted 94.9% of the company’s total revenues.
Regulation
SandRidge, Avalon and any other operators of the Underlying Properties have and will generate wastes that are subject to the requirements of the federal Resource Conservation and Recovery Act and comparable state statutes.
SandRidge developed and implemented spill prevention, control and countermeasure (SPCC) plans for the Underlying Properties as required under the federal Clean Water Act, and Avalon is continuing to administer these SPCC plans.
History
SandRidge Permian Trust was founded in 2011 under the Delaware Statutory Trust Act. The company was incorporated in 2011.