A month ago 2.6 m shares were sold in bulk at $13. The price dropped and didn't get back yet. Today's panic started when 170,000 shares were dumped on the market. Could it be that the bulk buyers are creating their own value by dumping shares in the mid $12's with the aim to buy back at $11.75? Maybe the airline crash was the catalyst they needed. The rest of the oil royalty crowd seemed to have a normal day.
No...the problem is ROYT wants to put in 96-new wells which will need to be steam oil recovery to take additional oil out....and this large source of new oil revenue for up to 30-years or more is now in Dire Jeopardy as a result of Left-Wing folks in Santa barbara County and City of Santa Barbara...I don't know what the court remedies may be but courts take lots of added time...meanwhile I think these shares of ROYT Unit Perpetual Trust will drop to $5.00 or $6.00...maybe even lower as the November 2014 vote in California comes up...and I expect the vote will seek to disallow ROYT with it's contemplated new wells and the steam injection altogether....Sad...very Sad!
The November ballot does not and cannot ban existing steam injections in existing wells. It only applies to newly-approvable wells. There is no impact on income at all, as even the 7.5% overriding royalty portion ($200k) will be paid to the ROYT unit holders even if the ban becomes active. In other words, you are suffering from a low IQ, and that's just terribly sad.
ROYT only receives $200k per month out of $5.7 million net profit per month from "Remaining Properties," because PCEC is obligated to pay what is called "7.5% overriding royalties." For the next 5+ years, the contributing factor of "new wells" is barely 3.5%, or 200k/5.7million in overall income of ROYT unit holders. Furthermore, even if new wells cannot be drilled, PCEC still has to pay the 7.5% overriding royalties to ROYT unit holders.
In other words, the short-term and the intermediate term impact of not having the "new wells" is virtually zero to ROYT unit holders. Remember that PCEC takes the lions share of the new well revenue in the first place, and NOT ROYT unit holders. In the very long term (10+ years from now), there may be some impact to ROYT incomes due to the gradual depletion of the Developed Properties, but remember, ten years from now, the oil price may be $150 / barrel or higher anyway, therefore offsetting any gradual depletion issues. ROYT was set up not to benefit much from new wells to begin with. The new wells were to benefit PCEC, and not ROYT unit holders. Do your own calculations before investing.