SJT Struggles with Negative Income Amid Low Gas Prices

The San Juan Basin Royalty Trust (SJT) faced significant financial difficulties between May 2024 and June 2026 due to excess production costs and low natural gas prices. As a result, no royalty income or distributions were made during this period, leading to negative distributable income and depleted cash reserves.

The trust relied on a line of credit to cover expenses, which raised substantial doubt about its ability to continue as a going concern. This financial strain highlights the vulnerability of trusts like SJT to external market factors.