BP Prudhoe Bay Royalty Trust Reports Continued Financial Decline in Q2 2025

BP Prudhoe Bay Royalty Trust reported its financial results for the second quarter of 2025, revealing a continued decline in its financial performance. The Trust's cash earnings for the three months ended June 30, 2025, amounted to a loss of $552,000, compared to a loss of $494,000 for the same period in 2024. For the first half of 2025, the Trust's cash earnings totaled a loss of $1.042 million, a significant increase from a loss of $765,000 in the first half of 2024. The Trust did not report any royalty revenues during either the second quarter or the first half of 2025, consistent with the previous year.

The Trust's total assets decreased to $3.117 million as of June 30, 2025, down from $4.159 million at the end of 2024. This decline was primarily attributed to the payment of administrative expenses from the Trust's cash reserve, which increased to $588,000 in the second quarter of 2025, up from $556,000 in the same quarter of 2024. The Trust's corpus also fell to $2.792 million from $3.627 million over the same period, reflecting the ongoing financial strain as the Trust continues to wind down its operations.

Operationally, the Trust has faced challenges due to the lack of royalty payments, which have been absent since the fourth quarter of 2022. The average West Texas Intermediate (WTI) price for the second quarter of 2025 was reported at $63.95 per barrel, which was below the break-even price necessary for the Trust to receive any royalty payments. The average net production from the Prudhoe Bay field allocated to the Trust was 63.3 thousand barrels per day, indicating a continued decline in production levels, which has been a trend since 2020.

Looking ahead, the Trust's future remains uncertain as it has entered a winding-down phase following its termination on December 31, 2024, due to insufficient revenues. The Trust has engaged RedOaks Energy Advisors, LLC to assist in the sale of its assets, with initial bids due by the end of July 2025. The Trustee has indicated that there is no assurance of a successful sale or that any active market for the Trust's units will develop following their delisting from the New York Stock Exchange. The Trustee believes the cash reserve is sufficient to cover administrative expenses for the next 12 months, but future distributions to unit holders remain uncertain, contingent on any potential revenues from the Royalty Interest.