Pacific Coast Oil Trust Announces There Will Be No April Cash Distribution - Seite 2

Sales Volumes and Prices

The following table displays PCEC’s underlying sales volumes and average prices for the month of February 2020:

Underlying Properties

Sales Volumes

 

Average Price

(Boe)

(Boe/day)

 

(per Boe)

Developed Properties (a)

52,622

1,815

$54.64

Remaining Properties (b)

16,778

579

$50.37

 

(a) Crude oil sales represented 100% of sales volumes

(b) Crude oil sales represented 100% of sales volumes

Update on Estimated Asset Retirement Obligations

As previously disclosed, in November 2019, PCEC informed the Trustee that, as permitted by the agreements governing the conveyances to the Trust, PCEC intended to begin deducting its estimated ARO associated with the West Pico, Orcutt Hill, Orcutt Hill Diatomite, East Coyote and Sawtelle fields reducing the amounts payable to the Trust under its Net Profits Interest. ARO is the accounting recognition related to plugging and abandonment obligations that all operators face. PCEC engaged an accounting firm to assist PCEC in determining its estimated ARO, and on February 27, 2020, PCEC informed the Trustee that PCEC’s estimate of its ARO, as of December 31, 2019, is $45,695,643, which is approximately $10.0 million less than the originally estimated amount as previously disclosed in the Trust’s Current Report on Form 8‑K filed on November 13, 2019. According to PCEC, the estimated ARO, which reflects PCEC’s assessment of current market conditions and recent changes in California law, was determined to be approximately $33.2 million for the Developed Properties and approximately $12.5 million for the Remaining Properties, and PCEC has reflected these amounts in the calculation of the net profits generated during January 2020. The consulting firm engaged by the Trustee to review PCEC’s original estimate of its ARO is continuing its review, and that firm as well as the Trust’s independent registered public accounting firm are continuing to evaluate PCEC’s more recent estimate. The actual ARO incurred in the future may exceed the estimated amounts provided by PCEC.