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DALLAS - Permian Basin Royalty Trust (NYSE:PBT), a $728 million market cap company with a stellar 100% gross profit margin, has reached a $9 million settlement agreement with Blackbeard Operating, LLC to resolve litigation over royalty payment disputes, according to a press release issued Tuesday.
The settlement resolves claims where the Trustee alleged Blackbeard failed to properly calculate and pay royalties for properties in the Waddell Ranch in Crane County, Texas, where the Trust holds a 75% net overriding royalty. According to InvestingPro data, PBT maintains strong financial health with a current ratio of 2.82, indicating robust liquidity to manage its operations.
Under the agreement, Blackbeard will pay $4.5 million to the Trust within 30 days, with the remaining $4.5 million to be paid in four quarterly installments of $1.125 million throughout 2026.
The settlement also establishes guidelines for future royalty calculations, including overhead rates chargeable to the Trust and provisions for third-party charges related to salt water disposal and transportation. Additionally, the agreement permits Blackbeard to charge technical labor on reservoir engineers using an agreed allocation methodology.
The Trust will have the option to conduct annual site audits at its own expense, and Blackbeard has agreed to provide specific reporting to the Trustee going forward.
Nancy Willis, Director of Royalty Trust Services of Argent Trust Company, which serves as Trustee, stated in the release that the resolution "provides value to Trust unitholders, as well as anticipated predictability with regard to how future royalty payments are calculated." With an impressive return on assets of 377%, PBT demonstrates strong operational efficiency. InvestingPro subscribers can access 13 additional key metrics and insights about PBT’s financial performance and valuation status.
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