Examples of different royalty trusts include the BP Prudhoe Bay Royalty Trust, the San Juan Basin Royalty Trust and the VOC Energy Trust, according to Aaron Levitt for InvestorPlace. Other examples of royalty trusts with significant remaining life and high yields include the Sabine Royalty Trust and the MV Oil Trust, notes Richard Robinson for Wall Street Daily.Continue Reading
Founded by BP, the Prudhoe Bay Royalty Trust is the largest oil and gas trust in the United States, and it collects fees on oil extracted from Alaska's Prudhoe Bay oil field, explains Levitt. As of 2015, the trust yields an 11 percent interest and has an estimated 15 years of dividend payments left. The San Juan Basin Royalty Trust owns the rights to natural gas wells in New Mexico and saw a 30 percent rise of units as a result of rising natural gas prices. The trust also saw an average 6 percent interest over the last year, with an average of 4 cents paid per share per month.
Owning oil and gas wells in Kansas and Texas and an 80 percent net royalty on the wells, the VOC Energy Trust earned a yield of approximately 14 percent as of 2015, states Levitt. However, the trust ends in 2031, resulting in zero shares and yield. Created in 1993, the Sabine Royalty Trust owns royalty and minerals rights in six states, including Florida, Texas, Oklahoma, New Mexico and Mississippi, according to Robinson. The MV Oil Trust owns wells in Kansas and Colorado, with payments expected to last until 2026.Learn more about Financial Planning