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BP Prudhoe Bay Royalty Trust Message Board

  • lws2000 lws2000 Dec 23, 2012 9:59 AM Flag

    Income + Energy to be recovered

    This looks like an incredible dividend, even if it is taxed at a higher rate. The amount of recoverable energy (oil, gas) is unknown, since new drilling techniques will increase the amount recovered. As a combination income, energy play, this is hard to beat.

    Sentiment: Strong Buy

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    • Remember that BPT doesn't pay a 'dividend'; it pays a 'royalty', which is handled much differently on your taxes. I don't know whether the reversions to old tax laws will affect the royalty; I don't believe it will, since it ends up as ordinary income, essentially.

      The main knock on owning BPT was always that the field would eventually be depleted of product, so the royalty would drop substantially, and / or the fixed cost would rise, thus cutting profit. I don't know what the current status of the field really is; hoping someone on here can comment on production numbers.

      Sentiment: Buy

    • Can you name what drilling techniques you are counting on? Lots of people say that most likely from someone else who said it but nobody ever gives details.
      BPT's distribution is not a qualified dividend so there will be no tax changes next year.

    • Down 47.15% YTD according to Google Finance. Yeah, that is hard to beat.

      • 1 Reply to lincolnparker60614
      • How do you make a small fortune ! start with a large one. THis stock is crushing people and they still talk about dividends. Has anyone noticed we are 48 months into this bull market, and the average past bull last only 38 to 40 months. What happens to the market when the bears comes, people invest like they are looking through the eye of a needle. So be it, throw your money in the streets.

    • There really are no new drilling techniques except for shale and tight formations. Slant and horizontal drilling have been practiced the past 50 years; not new. And, there is no new well drilling on the BPT wells put into this trust. The contractor does existing wells do get 'well workovers' which is standard for all existing wells that start to lose substantial production.

 
BPT
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