AUSTIN, Texas, Nov. 10, 2016 /PRNewswire/ -- Chesapeake Granite
Wash Trust (NYSE:CHKR) (the "Trust") today announced that its
common unit distribution for the quarter ended September 30, 2016 (which primarily relates to
production attributable to the Trust's royalty interests from
June 1, 2016 through August 31, 2016) will be $0.0857 per common unit. The distribution will be
paid on December 1, 2016 to all
common unitholders of record at the close of business on
November 21, 2016.
During the three-month production period ended August 31, 2016, sales volumes and realized
prices were both lower than initial Trust estimates. This resulted
in quarterly income available for distribution of $0.0643 per unit, which is $0.3757 below the applicable subordination
threshold of $0.4400. For this
distribution, all of the quarterly income available for
distribution will be used to make a distribution per common unit of
$0.0857 and the Trust will not pay a
subordinated unit distribution for the quarter.
The following table provides supporting documentation for the
calculation of distributable income available to unitholders for
the production period from June 1,
2016 through August 31,
2016.
|
Sales
volumes:
|
|
|
|
|
Oil (mbbl)
|
|
36
|
|
|
|
Natural gas
(mmcf)
|
|
981
|
|
|
|
Natural gas liquids
(mbbl)
|
|
88
|
|
|
|
Total oil equivalent volumes
(mboe)
|
|
288
|
|
|
|
|
|
|
|
|
Average price
received per production unit:(1)
|
|
|
|
|
Oil
|
|
$
|
41.02
|
|
|
|
Natural
gas
|
|
$
|
0.46
|
|
|
|
Natural gas
liquids
|
|
$
|
16.66
|
|
|
|
|
|
|
|
|
Distributable income
calculation (in thousands except per unit income):
|
|
|
|
|
Revenue less
production taxes(1)
|
|
$
|
3,258
|
|
|
|
Trust administrative
expenses
|
|
(252)
|
|
|
|
Distributable income
available to unitholders
|
|
$
|
3,006
|
|
|
|
Calculated
distributable income per unit(2)
|
|
$
|
0.0643
|
|
|
|
|
|
|
|
|
Distributable income
per common unit
|
|
$
|
0.0857
|
|
|
|
Distributable income
per subordinated unit(3)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
(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)
|
All subordinated
shares are owned by Chesapeake Energy Corporation. As the
distribution per common unit is below the applicable subordination
threshold, no distribution will be paid for the subordinated
units.
|
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.
The Trust was formed by Chesapeake Energy Corporation
("Chesapeake") in June 2011 and owns
royalty interests in certain oil and natural gas properties in the
Colony Granite Wash play in Washita
County, Oklahoma. The Trust is entitled to receive proceeds
from the sale of production attributable to the royalty interests.
As described in the Trust's filings with the Securities and
Exchange Commission (the "SEC"), the amount of Trust revenues and
the quarterly distributions to Trust unitholders will fluctuate
from quarter to quarter, depending on the timing of initial sales
from the development wells drilled by Chesapeake in which the Trust
receives an interest, the sales volume of oil, natural gas liquids
and natural gas attributable to the Trust's royalty interests and
the prices received for such sales and the amount of the Trust's
administrative expenses, among other factors.
For additional information regarding the Trust and its results
of operations and financial condition, please refer to the Trust's
SEC filings.
ABOUT CHESAPEAKE GRANITE WASH TRUST:
Chesapeake Granite Wash Trust (NYSE:CHKR) is a
Delaware statutory trust formed by
Chesapeake Energy Corporation to own certain royalty interests in
oil, natural gas liquids and natural gas wells in Washita County, Oklahoma producing from the
Colony Granite Wash play within the broader Granite Wash formation
of the Anadarko Basin. The common
units do not represent interests in and are not obligations of
Chesapeake Energy Corporation. The common units are listed on the
New York Stock Exchange under the symbol CHKR. Further information
is available at www.chkgranitewashtrust.com where Chesapeake
Granite Wash Trust routinely posts announcements, updates, investor
information and news releases.
Pursuant to IRC Section 1446, withholding tax on income
effectively connected to a U.S. trade or business allocated to
foreign partners should be made at the highest marginal rate. Under
Section 1441, withholding tax on fixed, determinable, annual,
periodic income from U.S. sources allocated to foreign partners
should be made at 30% of gross income unless the rate is reduced by
treaty. This release is intended to be a qualified notice to
nominees and brokers as provided for under Treasury Regulation
Section 1.1446-4(b) by Chesapeake Granite Wash Trust, and while
specific relief is not specified for Section 1441 income, this
disclosure is intended to suffice. For distributions made to
foreign partners, nominees and brokers should withhold at the
highest effective tax rate.
This news release contains statements that are
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements
contained in this news release, other than statements of historical
facts, are "forward-looking statements" for purposes of these
provisions. The anticipated distribution discussed herein is based,
in part, on the amount of cash received or expected to be received
by the Trust from Chesapeake with respect to the relevant quarterly
period. Any differences in actual cash receipts by the Trust could
affect this distributable amount. Other important factors that
could cause actual results to differ materially include expenses of
the Trust and reserves for anticipated future expenses. Neither
Chesapeake nor the Trustee intends, and neither assumes any
obligation, to update any of the statements included in this news
release. An investment in common units issued by Chesapeake Granite
Wash Trust is subject to the risks described in the Trust's Annual
Report on Form 10-K for the year ended December 31, 2015, as well as other risks
identified in the Trust's Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K filed with the SEC. The Trust's annual,
quarterly and other filed reports are or will be available at the
SEC's website at www.sec.gov. The Trust does not intend, and
assumes no obligations, to update any of the statements included in
this news release.
TRUSTEE CONTACT INFORMATION:
Bank of New York Mellon Trust Company, N.A.
Sarah Newell
512-236-6555
sarah.newell@bnymellon.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/chesapeake-granite-wash-trust-announces-distribution-of-00857-per-common-unit-300360895.html
SOURCE Chesapeake Granite Wash Trust