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EX-32 - EX-32 - WHITING USA TRUST I | d84018exv32.htm |
EX-31 - EX-31 - WHITING USA TRUST I | d84018exv31.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
for the quarterly period ended June 30, 2011 |
OR
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
for the transition period from to |
Commission File Number: 001-34026
WHITING USA TRUST I
(Exact name of registrant as specified in its charter)
Delaware | 26-6053936 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) | |
The Bank of New York Mellon | ||
Trust Company, N.A., Trustee | ||
Global Corporate Trust | ||
919 Congress Avenue | ||
Austin, Texas | 78701 | |
(Address of principal executive offices) | (Zip Code) |
1-800-852-1422
(Registrants telephone number, including area code)
(Registrants telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes
o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
Large accelerated filer o | Accelerated filer þ | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). Yes o No þ
As of August 1, 2011, 13,863,889 Units of Beneficial Interest in Whiting USA Trust I were
outstanding.
Table of Contents
GLOSSARY OF CERTAIN DEFINITIONS
The following are definitions of significant terms used in this report:
Bbl - One stock tank barrel, or 42 U.S. gallons liquid volume, used in this report in
reference to oil and other liquid hydrocarbons.
BOE - One stock tank barrel of oil equivalent, computed on an approximate energy equivalent
basis that one Bbl of crude oil equals six Mcf of natural gas and one Bbl of crude oil equals one
Bbl of natural gas liquids.
Completion - The installation of permanent equipment for the production of oil or natural gas,
or in the case of a dry hole, the reporting of abandonment to the appropriate agency.
COPAS - The Council of Petroleum Accountants Societies, Inc.
Costless collar - An options position where the proceeds from the sale of a call option fund
the purchase of a put option.
FASB ASC - The Financial Accounting Standards Board Accounting Standards Codification.
Field - An area consisting of either a single reservoir, or multiple reservoirs, all grouped
on or related to the same individual geological structural feature and/or stratigraphic condition.
GAAP - Generally accepted accounting principles in the United States.
Gross Acres or Gross Wells - The total acres or wells, as the case may be, in which a working
interest is owned.
MBbl - One thousand barrels of crude oil or other liquid hydrocarbons.
MBOE - One thousand BOE.
Mcf - One thousand standard cubic feet of natural gas. |
MMBOE - One million BOE.
MMcf - One million standard cubic feet of natural gas.
Net Profits Interest (NPI) - A nonoperating interest that creates a share in gross production
from an operating or working interest in oil and natural gas properties. The share is measured by
net profits from the sale of production after deducting costs associated with that production.
Plugging and Abandonment - Refers to the sealing off of fluids in the strata penetrated by a
well so that the fluids from one stratum will not escape into another or to the surface.
Regulations of many states require plugging of abandoned wells.
Recompletion - An operation whereby a completion in one zone is abandoned in order to attempt
a completion in a different zone within the existing wellbore.
Reserves - Estimated remaining quantities of oil and gas and related substances anticipated to
be economically producible, as of a given date, by application of development projects to known
accumulations. In addition, there must exist, or there must be a reasonable expectation that there
will exist, the legal right to produce or a revenue interest in the production, installed means of
delivering oil and gas or related substances to market, and all permits and financing required to
implement the project.
Reservoir - A porous and permeable underground formation containing a natural accumulation of
producible crude oil and/or natural gas that is confined by impermeable rock or water barriers and
is individual and separate from other reservoirs.
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SEC - The United States Securities and Exchange Commission.
Working Interest - The interest in a crude oil and natural gas property (normally a leasehold
interest) that gives the owner the right to drill, produce and conduct operations on the property
and to share in production, subject to all royalties, overriding royalties and other burdens and to
share in all costs of exploration, development and operations and all risks in connection
therewith.
Workover - Operations on a producing well to restore or increase production.
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Table of Contents
PART I FINANCIAL INFORMATION
Item 1. | Financial Statements. |
WHITING USA TRUST I
Statements of Assets, Liabilities and Trust Corpus (Unaudited)
(In thousands, except unit data)
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
Cash and short-term investments |
$ | 156 | $ | 145 | ||||
Investment in net profits interest, net |
54,297 | 61,999 | ||||||
Total assets |
$ | 54,453 | $ | 62,144 | ||||
LIABILITIES AND TRUST CORPUS |
||||||||
Reserve for Trust expenses |
$ | 156 | $ | 145 | ||||
Trust corpus (13,863,889 Trust units issued and outstanding) |
54,297 | 61,999 | ||||||
Total liabilities and Trust corpus |
$ | 54,453 | $ | 62,144 | ||||
Statements of Distributable Income (Unaudited)
(In thousands, except distributable income per unit data)
(In thousands, except distributable income per unit data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Income from net profits interest |
$ | 10,312 | $ | 10,023 | $ | 19,879 | $ | 19,489 | ||||||||
General and administrative expenses |
(190 | ) | (222 | ) | (389 | ) | (506 | ) | ||||||||
Cash reserves (withheld) used for current Trust expenses |
40 | (28 | ) | (11 | ) | 56 | ||||||||||
State income tax withholding |
(59 | ) | (55 | ) | (117 | ) | (126 | ) | ||||||||
Distributable income |
$ | 10,103 | $ | 9,718 | $ | 19,362 | $ | 18,913 | ||||||||
Distributable income per unit |
$ | 0.728739 | $ | 0.700986 | $ | 1.396567 | $ | 1.364167 | ||||||||
Statements of Changes in Trust Corpus (Unaudited)
(In thousands)
(In thousands)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Trust corpus, beginning of period |
$ | 58,260 | $ | 75,193 | $ | 61,999 | $ | 79,346 | ||||||||
Distributable income |
10,103 | 9,718 | 19,362 | 18,913 | ||||||||||||
Distributions to unitholders |
(10,103 | ) | (9,718 | ) | (19,362 | ) | (18,913 | ) | ||||||||
Amortization of investment in net profits interest |
(3,963 | ) | (4,470 | ) | (7,702 | ) | (8,623 | ) | ||||||||
Trust corpus, end of period |
$ | 54,297 | $ | 70,723 | $ | 54,297 | $ | 70,723 | ||||||||
The accompanying notes are an integral part of these financial statements.
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Table of Contents
WHITING USA TRUST I
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. ORGANIZATION OF THE TRUST
Formation of the Trust Whiting USA Trust I (the Trust) is a statutory trust formed in October
2007 under the Delaware Statutory Trust Act, pursuant to a trust agreement (the Trust agreement)
among Whiting Oil and Gas Corporation and Equity Oil Company, as trustors, The Bank of New York
Trust Company, N.A., as Trustee (subsequently renamed The Bank of New York Mellon Trust Company,
N.A., and hereinafter referred to as the Trustee), and Wilmington Trust Company as Delaware
Trustee (the Delaware Trustee). The initial capitalization of the Trust estate was funded by
Whiting Petroleum Corporation (Whiting) in November 2007. Effective September 30, 2009, Equity
Oil Company merged into Whiting Oil and Gas Corporation (Whiting Oil and Gas) with Whiting Oil
and Gas as the surviving corporation. Whiting Oil and Gas, as referred to herein, is a subsidiary
of Whiting and the successor to Equity Oil Company.
The Trust was created to acquire and hold a term net profits interest (NPI) for the benefit of
the Trust unitholders pursuant to a conveyance to the Trust from Whiting Oil and Gas. The term NPI
is an interest in underlying oil and natural gas properties located in the Rocky Mountains,
Mid-Continent, Permian Basin and Gulf Coast regions (the underlying properties). The NPI is the
only asset of the Trust, other than cash held for Trust expenses. As of December 31, 2010, these
oil and gas properties included interests in 3,077 gross (373.1 net) producing oil and gas wells.
The NPI is passive in nature, and the Trustee has no management control over and no responsibility
relating to the operation of the underlying properties. The NPI entitles the Trust to receive 90%
of the net proceeds from the sale of production from the underlying properties. The NPI will
terminate when 9.11 MMBOE have been produced and sold from the underlying properties (which amount
is the equivalent of 8.20 MMBOE in respect of the Trusts right to receive 90% of the net proceeds
from such reserves pursuant to the NPI), and the Trust will soon thereafter wind up its affairs and
terminate. These reserve quantities are projected to be produced by November 30, 2015, based on the
reserve report for the underlying properties as of December 31, 2010.
The Trustee can authorize the Trust to borrow money for the purpose of paying Trust administrative
or incidental expenses that exceed cash held by the Trust. The Trustee may authorize the Trust to
borrow from the Trustee, Whiting, or the Delaware Trustee as a lender, provided the terms of the
loan are similar to the terms it would grant to a similarly situated commercial customer with whom
it did not have a fiduciary relationship. The Trustee may also deposit funds awaiting distribution
in an account with itself and make other short-term investments with the funds distributed to the
Trust.
Initial Issuance of Trust Units and Net Profits Interest Conveyance In April 2008, the
registration statement on Form S-1/S-3 (Registration No. 333-147543) filed by Whiting and the Trust
in connection with the initial public offering of the Trust units was declared effective by the
SEC. Subsequently, the Trust issued 13,863,889 Trust units to Whiting in exchange for the
conveyance of the term NPI from Whiting Oil and Gas, as discussed above. Immediately thereafter,
Whiting completed an initial public offering of units of beneficial interest in the Trust, selling
11,677,500 Trust units to the public. Whiting retained, and has continued to retain, an ownership
in 2,186,389 Trust units, or 15.8% of the total Trust units issued and outstanding.
2. BASIS OF ACCOUNTING
Interim Financial Statements The accompanying unaudited financial information has been prepared
by the Trustee in accordance with the instructions to Form 10-Q. The accompanying financial
information is prepared on a comprehensive basis of accounting other than GAAP. The Trustee
believes that the information furnished reflects all adjustments (consisting of normal and
recurring adjustments) which are, in the opinion of the Trustee, necessary for a fair presentation
of the results for the interim periods presented. The Trusts 2010 Annual Report on Form 10-K
includes certain definitions and a summary of significant accounting policies and should be read in
conjunction with this Form 10-Q. Operating results for the periods presented are not necessarily
indicative of the results that may be expected for the full year.
Term Net Profits Interest The Trust uses the modified cash basis of accounting to report Trust
receipts from the term NPI and payments of expenses incurred. The actual cash distributions from
Whiting to the Trust are made based on the terms of the conveyance that created the Trusts NPI.
The term NPI entitles the Trust to receive revenues (oil, gas and natural gas liquid sales) less
expenses (the amount by which all royalties, lease operating expenses including well workover
costs, production and property taxes, payments made by Whiting to the hedge counterparty upon
settlements of hedge contracts, maintenance expenses, post-production
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costs including plugging and abandonment, and producing overhead, exceed hedge payments received by
Whiting under hedge contracts and other non-production revenue) of the underlying properties
multiplied by 90% (term NPI percentage). Actual cash receipts may vary due to timing delays of cash
receipts from the property operators or purchasers and due to wellhead and pipeline volume
balancing agreements or practices.
Modified Cash Basis of Accounting The financial statements of the Trust, as prepared on a
modified cash basis, reflect the Trusts assets, liabilities, Trust corpus, earnings and
distributions, as follows:
a) | Income from net profits interest is recorded when NPI distributions are received by the Trust; | ||
b) | Distributions to Trust unitholders are recorded when paid by the Trust; | ||
c) | Trust general and administrative expenses (which include the Trustees fees as well as accounting, engineering, legal, and other professional fees) are recorded when paid; | ||
d) | Cash reserves for Trust expenses may be established by the Trustee for certain expenditures that would not be recorded as contingent liabilities under GAAP; | ||
e) | Amortization of the investment in net profits interest is calculated based on the units-of-production method. Such amortization is charged directly to Trust corpus and does not affect cash earnings; and | ||
f) | The Trust evaluates impairment of the investment in net profits interest by comparing the undiscounted cash flows expected to be realized from the investment in net profits interest to the NPI carrying value. If the expected future undiscounted cash flows are less than the carrying value, the Trust recognizes an impairment loss for the difference between the carrying value and the estimated fair value of the investment in net profits interest. The determination of whether the NPI is impaired requires judgment by the Trustee and is based on the best information available to the Trustee at the time of the evaluation. If market or oil and gas production conditions deteriorate, write-downs could be required in the future. |
While these statements differ from financial statements prepared in accordance with GAAP, the
modified cash basis of reporting revenues and distributions is considered to be the most meaningful
because quarterly distributions to the Trust unitholders are based on net cash receipts. This
comprehensive basis of accounting other than GAAP corresponds to the accounting permitted for
royalty trusts by the SEC as specified by FASB ASC Topic 932, Extractive Activities Oil and Gas:
Financial Statements of Royalty Trusts.
Most accounting pronouncements apply to entities whose financial statements are prepared in
accordance with GAAP, directing such entities to accrue or defer revenues and expenses in a period
other than when such revenues were received or expenses were paid. Because the Trusts financial
statements are prepared on the modified cash basis as described above, however, most accounting
pronouncements are not applicable to the Trusts financial statements.
Recent Accounting Pronouncements There were no accounting pronouncements issued during the six
months ended June 30, 2011 applicable to the Trust or its financial statements.
3. INVESTMENT IN NET PROFITS INTEREST
Whiting Oil and Gas conveyed the NPI to the Trust in exchange for 13,863,889 Trust units. The
investment in net profits interest was recorded at the historical cost of Whiting on April 30,
2008, the date of conveyance, and was determined to be $123.6 million, of which $111.2 million (90%
of the NPI) was attributed to the Trust. As of June 30, 2011 and December 31, 2010, accumulated
amortization of the investment in net profits interest was $56.9 million and $49.2 million,
respectively.
4. INCOME TAXES
The Trust is a grantor trust and therefore is not subject to federal income taxes. Accordingly, no
recognition has been given to federal income taxes in the Trusts financial statements. The Trust
unitholders are treated as the owners of Trust income and corpus, and the entire federal taxable
income of the Trust is reported by the Trust unitholders on their respective tax returns.
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For Montana state income tax purposes, Whiting must withhold from its NPI payments to the Trust, an
amount equal to 6% of the net amount payable to the Trust from the sale of oil and gas in Montana.
For North Dakota, Oklahoma, Arkansas, Michigan, New Mexico, Alabama, Louisiana, Colorado, Kansas,
Utah and Mississippi, neither the Trust nor Whiting is withholding the income tax due such states
on distributions made to an individual resident or nonresident Trust unitholder, as long as the
Trust is taxed as a grantor trust under the Internal Revenue Code.
5. DISTRIBUTION TO UNITHOLDERS
Actual cash distributions to the Trust unitholders depend on the volumes of and prices received for
oil, natural gas and natural gas liquids produced from the underlying properties, among other
factors. Quarterly cash distributions during the term of the Trust are made by the Trustee
generally no later than 60 days following the end of each quarter (or the next succeeding business
day) to the Trust unitholders of record on the 50th day following the end of each quarter. Such
amounts equal the excess, if any, of the cash received by the Trust during the quarter, over the
expenses of the Trust paid during such quarter, subject to any adjustments for changes made by the
Trustee during such quarter in cash reserves established for future expenses of the Trust.
6. RELATED PARTY TRANSACTIONS
Capital Expenditures During the three and six months ended June 30, 2011, Whiting incurred $0.4
million and $1.7 million, respectively, of capital expenditures on the underlying properties, which
are the costs net to Whitings interest in the wells, related to the drilling and completing of oil
and gas wells, capital workovers, facility upgrades and well recompletions performed to secure
production from new horizons. These expenditures may have the effect of ultimately increasing
current and future period NPI net proceeds and thereby benefiting the Trust unitholders by
accelerating their return on investment. Pursuant to the terms of the conveyance agreement,
however, Whiting did not deduct, nor will it deduct in the future, such capital expenditures from
the NPI gross proceeds or related distributions to the Trust. The Trust cannot provide any
assurance that this will continue to occur or that future capital expenditures will be consistent
with historical levels.
Operating Overhead Pursuant to the terms of the applicable joint operating agreements, Whiting
deducts from the gross proceeds an overhead fee to operate those underlying properties for which
Whiting has been designated as the operator. Additionally, with respect to those underlying
properties for which Whiting is the operator but where there is no operating agreement in place,
Whiting deducts from the gross proceeds an overhead fee calculated in the same manner Whiting
allocates overhead to other similarly owned properties, which is customary practice in the oil and
gas industry. Operating overhead activities include various engineering, legal, and administrative
functions. The fee is adjusted annually pursuant to COPAS guidelines and will increase or decrease
each year based on changes in the year-end index of average weekly earnings of crude petroleum and
natural gas workers. The following table presents the Trusts portion of these overhead charges for
the distributions made during the three and six months ended June 30, 2011 and 2010 (in thousands,
except per well data):
Three Months Ended June30, | Six Months Ended June 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Total overhead charges (in thousands) |
$ | 413 | $ | 446 | $ | 845 | $ | 886 | ||||||||
Overhead charge per month per active operated well |
$ | 392 | $ | 414 | $ | 401 | $ | 411 |
Administrative Services Fee Under the terms of the administrative services agreement, the Trust
pays a quarterly administration fee of $50,000 to Whiting 60 days following the end of each
calendar quarter. General and administrative expenses in the Trusts statements of distributable
income for the three and six months ended June 30, 2011 include $50,000 for quarterly
administrative fees paid to Whiting. General and administrative expenses for the three and six
months ended June 30, 2010 include $50,000 and $100,000, respectively, for quarterly administrative
fees paid to Whiting.
Trustee Administrative Fee Under the terms of the Trust agreement, the Trust pays an annual
administrative fee to the Trustee of $160,000, paid in four quarterly installments of $40,000 each
and is billed in arrears. General and administrative expenses in the Trusts statements of
distributable income for the three and six month periods ending June 30, 2011 include $40,000 and
$80,000, respectively, for quarterly administrative fees paid to the Trustee, and general and
administrative expenses for the three and six month periods ending June 30, 2010 also include
$40,000 and $80,000, respectively, for quarterly administrative fees paid to Trustee.
Letter of Credit On February 8, 2011, Whiting established a $1.0 million letter of credit for
the Trustee in order to provide a mechanism for the Trustee to pay the operating expenses of the
Trust in the unlikely event that Whiting should fail to fund the Trust in the future. This letter
of credit will not be used to fund NPI distributions to unitholders.
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7. SUBSEQUENT EVENTS
On August 5, 2011, the Trustee announced the Trust distribution of net profits for the second
quarterly payment period in 2011. Unitholders of record on August 19, 2011 are expected to receive
a distribution amounting to $11.4 million or $0.824101 per Trust unit, which is payable on or
before August 29, 2011. This distribution is expected to consist of net cash proceeds of $11.7
million paid by Whiting to the Trust, which is inclusive of cash receipts totaling $667,923 (90% of
$742,137) for commodity derivative contracts settled from April through June 2011, less a provision
of $175,000 for estimated Trust expenses and $83,766 for Montana state income tax withholdings.
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Item 2. | Trustees Discussion and Analysis of Financial Condition and Results of Operations. |
References to the Trust in this document refer to Whiting USA Trust I. References to Whiting in
this document refer to Whiting Petroleum Corporation and its subsidiaries. References to Whiting
Oil and Gas in this document refer to Whiting Oil and Gas Corporation, a 100%-owned subsidiary of
Whiting Petroleum Corporation and the successor to Equity Oil Company. Equity Oil Company was
merged into Whiting Oil and Gas Corporation effective September 30, 2009. The merger did not have
an effect on the Trust.
The following review of the Trusts financial condition and results of operations should be read in
conjunction with the financial statements and notes thereto, as well as the Trustees discussion
and analysis contained in the Trusts 2010 Annual Report on Form 10-K. The Trusts Annual Report on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those
reports are available on the SECs website www.sec.gov.
Note Regarding Forward-Looking Statements
This Form 10-Q includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements other than statements of historical facts included in this Form 10-Q,
including without limitation the statements under Trustees Discussion and Analysis of Financial
Condition and Results of Operations are forward-looking statements. No assurance can be given that
such expectations will prove to have been correct. When used in this document, the words
believes, expects, anticipates, projects, intends or similar expressions are intended to
identify such forward-looking statements. The following important factors, in addition to those
discussed elsewhere in this Form 10-Q, could affect the future results of the energy industry in
general, and Whiting and the Trust in particular, and could cause actual results to differ
materially from those expressed in such forward-looking statements:
| the effect of changes in commodity prices and conditions in the capital markets; | ||
| the effects of global credit, financial and economic issues; | ||
| uncertainty of estimates of oil and natural gas reserves and production; | ||
| risks incident to the operation of oil and natural gas wells; | ||
| future production costs; | ||
| the inability to access oil and natural gas markets due to market conditions or operational impediments; | ||
| failure of the underlying properties to yield oil or natural gas in commercially viable quantities; | ||
| the effect of existing and future laws and regulatory actions; | ||
| competition from others in the energy industry; | ||
| risks arising out of the hedge contracts; | ||
| inflation or deflation; and | ||
| other risks described under the caption Risk Factors in the Trusts 2010 Annual Report on Form 10-K. |
All subsequent written and oral forward-looking statements attributable to Whiting or the Trust or
persons acting on behalf of Whiting or the Trust are expressly qualified in their entirety by these
factors. The Trust assumes no obligation, and disclaims any duty, to update these forward-looking
statements.
Overview
The Trust does not conduct any operations or activities. The Trusts purpose is, in general, to
hold the NPI, to distribute to the Trust unitholders cash that the Trust receives in respect of the
NPI and to perform certain administrative functions in respect of the NPI and the Trust units. The
Trust derives substantially all of its income and cash flows from the NPI, which is in turn subject
to commodity hedge contracts. The NPI entitles the Trust to receive 90% of the net proceeds from
the sale of production from the underlying
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properties. The NPI will terminate when 9.11 MMBOE have been produced and sold from the underlying
properties (which amount is the equivalent of 8.20 MMBOE in respect of the Trusts right to receive
90% of the net proceeds from such reserves pursuant to the NPI), and the Trust will soon thereafter
wind up its affairs and terminate. These reserve quantities are projected to be produced by
November 30, 2015, based on the reserve report for the underlying properties as of December 31,
2010. As of June 30, 2011, on a cumulative accrual basis, 4.47 MMBOE of the Trusts total 8.20
MMBOE have been produced and sold (of which proceeds from the sale of 267 MBOE will be distributed to the unitholders of
record on August 19, 2011 in the Trusts forthcoming August 29, 2011 distribution) and a cumulative
0.02 MMBOE have been divested.
Oil and gas prices historically have been volatile and may
fluctuate widely in the future. The following table highlights these price trends by listing quarterly average NYMEX
crude oil and natural gas prices for the periods indicated through March 31, 2011 (as the May 2011 NPI
distribution is affected only by January 2011 through March 2011 oil prices and by December 2010
through February 2011 natural gas prices):
2009 | 2010 | 2011 | ||||||||||||||||||||||||||||||||||
Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | ||||||||||||||||||||||||||||
Crude Oil |
$43.21 | $59.62 | $68.29 | $76.17 | $78.79 | $77.99 | $76.21 | $85.18 | $94.25 | |||||||||||||||||||||||||||
Natural Gas |
$4.92 | $3.50 | $3.40 | $4.16 | $5.30 | $4.09 | $4.39 | $3.81 | $4.10 |
Lower oil and gas prices on production from the underlying properties could cause the following:
(i) a reduction in the amount of net proceeds to which the Trust is entitled; (ii) a reduction in
the amount of oil, natural gas and natural gas liquids that is economic to produce from the
underlying properties; and (iii) an extension of the length of time required to produce 9.11 MMBOE
(8.20 MMBOE at the 90% NPI) due to some wells thereby reaching their economic limits sooner.
Alternatively, higher oil and natural gas prices may potentially result in the following: (i) an
increase in the amount of oil, natural gas and natural gas liquids that is economic to produce from
the underlying properties; (ii) a shortening of the length of time required to produce 9.11 MMBOE
(8.20 MMBOE at the 90% NPI); (iii) a decrease in the Trusts cash settlement gains on commodity
derivatives; and (iv) cash settlement losses on commodity derivatives.
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Results of Trust Operations
Six Months Ended June 30, 2011 Compared to Six Months Ended June 30, 2010
The following is a summary of income from net profits interest received by the Trust for the six
months ended June 30, 2011 and 2010, consisting of the February and May distributions for each
respective year (dollars in thousands, except per Bbl, per Mcf, and per BOE amounts):
Six Months Ended June 30, | ||||||||
2011 | 2010 | |||||||
Sales volumes: |
||||||||
Oil from underlying properties (MBbls) |
383 | (a) | 394 | (b) | ||||
Natural gas from underlying properties (MMcf) |
1,520 | (a) | 1,727 | (b) | ||||
Total production (MBOE) |
636 | 682 | ||||||
Average sales prices: |
||||||||
Oil (per Bbl) |
$ | 74.83 | $ | 66.22 | ||||
Effect of oil hedges on average price (per Bbl) |
| 0.19 | ||||||
Oil net of hedging (per Bbl) |
$ | 74.83 | $ | 66.41 | ||||
Natural gas (per Mcf) |
$ | 3.91 | $ | 4.25 | ||||
Effect of natural gas hedges on average price (per Mcf) |
1.91 | 1.35 | ||||||
Natural gas net of hedging (per Mcf) |
$ | 5.82 | $ | 5.60 | ||||
Costs (per BOE): |
||||||||
Lease operating expenses |
$ | 20.23 | $ | 17.27 | ||||
Production taxes |
$ | 3.96 | $ | 3.52 | ||||
Revenues: |
||||||||
Oil sales |
$ | 28,632 | (a) | $ | 26,084 | (b) | ||
Natural gas sales |
5,944 | (a) | 7,336 | (b) | ||||
Total revenues |
$ | 34,576 | $ | 33,420 | ||||
Costs: |
||||||||
Lease operating expenses |
$ | 12,868 | $ | 11,771 | ||||
Production taxes |
2,521 | 2,398 | ||||||
Cash settlement gains received on commodity derivatives |
(2,901 | ) | (2,403 | ) | ||||
Total costs |
$ | 12,488 | $ | 11,766 | ||||
Net proceeds |
$ | 22,088 | $ | 21,654 | ||||
Net profits percentage |
90 | % | 90 | % | ||||
Income from net profits interest |
$ | 19,879 | $ | 19,489 | ||||
(a) | Oil and gas sales volumes and related revenues for the six months ended June 30, 2011 (consisting of Whitings February and May 2011 NPI distributions to the Trust) generally represent crude oil production from October 2010 through March 2011 and natural gas production from September 2010 through February 2011. | |
(b) | Oil and gas sales volumes and related revenues for the six months ended June 30, 2010 (consisting of Whitings February and May 2010 NPI distributions to the Trust) generally represent crude oil production from October 2009 through March 2010 and natural gas production from September 2009 through February 2010. |
Income from Net Profits Interest. Income from net profits interest is recorded on a cash basis when
NPI proceeds are received by the Trust from Whiting. NPI proceeds that Whiting remits to the Trust
are based on the oil and gas production Whiting has received payment for within one month following
the end of the most recent fiscal quarter. Whiting receives payment for its crude oil sales
generally within 30 days following the month in which it is produced, and Whiting receives payment
for its natural gas sales generally within 60 days following the month in which it is produced.
Income from net profits interest is generally a function of oil and gas revenues, lease operating
expenses, production taxes, and cash settlements on commodity derivatives, described as follows:
Revenues. Oil and natural gas revenues increased $1.2 million or 3% for the six months ended June
30, 2011 as compared to the same period in 2010. Revenues are a function of oil and natural gas
sales prices and volumes sold. The increase in revenues between periods was due to a higher
market price for oil during the first half of 2011, which effect was partially offset by a lower
market price for natural gas and lower oil and natural gas sales volumes between periods. The
average price for oil before the
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effects of hedging increased 13% between periods, while the average price for natural gas before
the effects of hedging decreased 8%. Oil sales volumes decreased 3% or 11 MBbls, and gas sales
volumes decreased 12% or 207 MMcf in the first six months of 2011 as compared to the same period
in 2010. Both of these volume decreases were primarily due to normal field production decline.
Lease Operating Expenses. Lease operating expenses increased $1.1 million or 9% from the first
six months of 2010 to the first six months of 2011, and lease operating expenses on a BOE basis
increased 17% from $17.27 during the first six months of 2010 to $20.23 during the same period in
2011. This increase in lease operating expense during the first six months of 2011 was primarily
due to an increase in workover activity between periods, a higher level of plug and abandonment
charges and a higher amount of operating costs charged to wells that are not operated by Whiting.
Production Taxes. Production taxes are generally calculated as a percentage of oil and natural
gas revenues before the effects of hedging. Tax credits and exemptions allowed in the various
taxing jurisdictions are generally utilized to their potential. Production taxes as a percentage
of oil and gas revenues before the effects of hedging remained relatively constant for the first
six months of 2011 and 2010 at 7.3% and 7.2%, respectively.
Cash Settlements on Commodity Derivatives. In connection with Whitings conveyance of the net
profits interest to the Trust, Whiting entered into certain costless collar hedge contracts in
order to reduce the Trusts exposure to commodity price volatility. If current market prices are
lower than a collars price floor when the cash settlement amount is calculated, Whiting receives
cash proceeds from the contract counterparty. Conversely, if current market prices are higher
than a collars price ceiling when the cash settlement amount is calculated, Whiting is required
to pay the contract counterparty. Cash settlements relating to these hedges resulted in a gain of
$2.9 million for the six months ended June 30, 2011, which had the effect of increasing the
average price of natural gas by $1.91 per Mcf. Cash settlements relating to these hedges resulted
in a gain of $2.4 million for the six months ended June 30, 2010, which had the effect of
increasing average prices by $0.19 per Bbl of oil and $1.35 per Mcf of natural gas.
Distributable Income. For the six months ended June 30, 2011, the Trusts distributable income was
$19.4 million and was based on income from net profits interest of $19.9 million less Trust general
and administrative costs and cash withheld of $400,000 and Montana state income tax withholdings of
$117,140. This compares to distributable income of $18.9 million for the first six months of 2010,
which was based on income from net profits interest of $19.5 million less $450,000 for Trust
expenses and $125,913 in Montana state income tax withholdings.
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Three Months Ended June 30, 2011 Compared to Three Months Ended June 30, 2010
The following is a summary of income from net profits interest received by the Trust for the three
months ended June 30, 2011 and 2010, consisting of the May distribution for each respective year
(dollars in thousands, except per Bbl, per Mcf, and per BOE amounts):
Three Months Ended June 30, | ||||||||
2011 | 2010 | |||||||
Sales volumes: |
||||||||
Oil from underlying properties (MBbls) |
185 | (a) | 192 | (b) | ||||
Natural gas from underlying properties (MMcf) |
751 | (a) | 842 | (b) | ||||
Total production (MBOE) |
310 | 333 | ||||||
Average sales prices: |
||||||||
Oil (per Bbl) |
$ | 79.25 | $ | 68.14 | ||||
Effect of oil hedges on average price (per Bbl) |
| | ||||||
Oil net of hedging (per Bbl) |
$ | 79.25 | $ | 68.14 | ||||
Natural gas (per Mcf) |
$ | 4.16 | $ | 5.02 | ||||
Effect of natural gas hedges on average price (per Mcf) |
1.79 | 1.01 | ||||||
Natural gas net of hedging (per Mcf) |
$ | 5.95 | $ | 6.03 | ||||
Costs (per BOE): |
||||||||
Lease operating expenses |
$ | 20.67 | $ | 17.48 | ||||
Production taxes |
$ | 4.12 | $ | 3.68 | ||||
Revenues: |
||||||||
Oil sales |
$ | 14,690 | (a) | $ | 13,100 | (b) | ||
Natural gas sales |
3,125 | (a) | 4,224 | (b) | ||||
Total revenues |
$ | 17,815 | $ | 17,324 | ||||
Costs: |
||||||||
Lease operating expenses |
$ | 6,417 | $ | 5,812 | ||||
Production taxes |
1,278 | 1,224 | ||||||
Cash settlement gains received on commodity derivatives |
(1,339 | ) | (849 | ) | ||||
Total costs |
$ | 6,356 | $ | 6,187 | ||||
Net proceeds |
$ | 11,459 | $ | 11,137 | ||||
Net profits percentage |
90 | % | 90 | % | ||||
Income from net profits interest |
$ | 10,312 | $ | 10,023 | ||||
(a) | Oil and gas sales volumes and related revenues for the quarter ended June 30, 2011 (consisting of Whitings May 2011 NPI distribution to the Trust) generally represent crude oil production from January 2011 through March 2011 and natural gas production from December 2010 through February 2011. | |
(b) | Oil and gas sales volumes and related revenues for the quarter ended June 30, 2010 (consisting of Whitings May 2010 NPI distribution to the Trust) generally represent crude oil production from January 2010 through March 2010 and natural gas production from December 2009 through February 2010. |
Income from Net Profits Interest. Income from net profits interest is recorded on a cash basis when
NPI proceeds are received by the Trust from Whiting. NPI proceeds that Whiting remits to the Trust
are based on the oil and gas production Whiting has received payment for within one month following
the end of the most recent fiscal quarter. Whiting receives payment for its crude oil sales
generally within 30 days following the month in which it is produced, and Whiting receives payment
for its natural gas sales generally within 60 days following the month in which it is produced.
Income from net profits interest is generally a function of oil and gas revenues, lease operating
expenses, production taxes, and cash settlements on commodity derivatives, described as follows:
Revenues. Oil and natural gas revenues increased $0.5 million or 3% for the three months ended
June 30, 2011 as compared to the same period in 2010. Revenues are a function of oil and natural
gas sales prices and volumes sold. The increase in revenues between periods was due to a higher
market price for oil during the second quarter of 2011, which effect was partially offset by a
lower market price for natural gas and lower oil and natural gas sales volumes between periods.
The average price for oil before the effects of hedging increased 16%, while the average price
for natural gas before the effects of hedging decreased 17%. Oil sales volumes decreased 4% or 7
MBbls between quarters, and gas sales volumes decreased 11% or 91 MMcf in the three months
ended June 30, 2011 as compared to the same period in 2010. Both of these volume decreases were
primarily due to normal field production decline.
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Lease Operating Expenses. Lease operating expenses increased $0.6 million or 10% from the second
quarter of 2010 to the second quarter of 2011, and lease operating expenses on a BOE basis
increased 18% from $17.48 during the second quarter of 2010 to $20.67 during the same period in
2011. This increase in lease operating expense during the second quarter of 2011 was primarily
due to an increase in labor costs on Whiting-operated properties, an increase in workover
activity and a higher level of plug and abandonment charges between periods.
Production Taxes. Production taxes are generally calculated as a percentage of oil and natural
gas revenues before the effects of hedging. Tax credits and exemptions allowed in the various
taxing jurisdictions are generally utilized to their potential. Production taxes as a percentage
of oil and gas revenues before the effects of hedging remained relatively constant for the second
quarter of 2011 and 2010 at 7.2% and 7.1%, respectively.
Cash Settlements on Commodity Derivatives. In connection with Whitings conveyance of the net
profits interest to the Trust, Whiting entered into certain costless collar hedge contracts in
order to reduce the Trusts exposure to commodity price volatility. If current market prices are
lower than a collars price floor when the cash settlement amount is calculated, Whiting receives
cash proceeds from the contract counterparty. Conversely, if current market prices are higher
than a collars price ceiling when the cash settlement amount is calculated, Whiting is required
to pay the contract counterparty. Cash settlements relating to these hedges resulted in a gain of
$1.3 million for the three months ended June 30, 2011, which had the effect of increasing the
average price of natural gas by $1.79 per Mcf. Cash settlements relating to these hedges resulted
in a gain of $0.8 million for the three months ended June 30, 2010, which had the effect of
increasing the average price of natural gas by $1.01 per Mcf.
Distributable Income. For the three months ended June 30, 2011, the Trusts distributable income
was $10.1 million and was based on income from net profits interest of $10.3 million less Trust
general and administrative costs and cash withheld of $150,000 and Montana state income tax
withholdings of $59,421. This compares to distributable income of $9.7 during the second quarter of
2010, which was based on income from net profits interest of $10.0 million less $250,000 for Trust
expenses and $54,576 in Montana state income tax withholdings.
Liquidity and Capital Resources
The Trust has no source of liquidity or capital resources other than cash flows from the NPI. Other
than Trust administrative expenses, including any reserves established by the Trustee for future
liabilities, the Trusts only use of cash is for distributions to Trust unitholders. Administrative
expenses include payments to the Trustee and the Delaware Trustee as well as a quarterly fee to
Whiting pursuant to an administrative services agreement. Each quarter, the Trustee determines the
amount of funds available for distribution to unitholders. Available funds are the excess cash, if
any, received by the Trust from the NPI and other sources (such as interest earned on any amounts
reserved by the Trustee) that quarter, over the Trusts expenses for that quarter. Available funds
are reduced by any cash the Trustee decides to hold as a reserve against future liabilities. The
Trustee may borrow funds required to pay liabilities if the Trustee determines that the cash on
hand and the cash to be received are insufficient to cover the Trusts liabilities. If the Trustee
borrows funds, the Trust unitholders will not receive distributions until the borrowed funds are
repaid.
Income to the Trust from the NPI is based on the calculation and definitions of gross proceeds
and net proceeds contained in the conveyance agreement, which is listed as an exhibit to this
report, and reference is hereby made to such conveyance agreement for the actual definitions of
gross proceeds and net proceeds.
Although capital expenditures for the testing, drilling, completion, equipping, plugging back or
recompletion of any well that is a part of the underlying properties cannot be deducted from gross
proceeds pursuant to the terms of the conveyance agreement, Whiting incurred capital expenditures
of $1.7 million on the underlying properties during the six months ended June 30, 2011.
Accordingly, these expenditures were not deducted from gross proceeds or the distributions in the
first half of 2011 but may have the ultimate effect of accelerating the receipt of NPI net proceeds
and thereby benefiting Trust unitholders by accelerating their return on investment. The Trust
cannot provide any assurance that this will continue to occur or that future capital expenditures
will be consistent with historical levels.
On February 8, 2011, Whiting established a $1.0 million letter of credit for the Trustee in order
to provide a mechanism for the Trustee to pay the operating expenses of the Trust in the unlikely
event that Whiting should fail to fund the Trust in the future. This letter of credit will not be
used to fund NPI distributions to unitholders.
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The Trust does not have any transactions, arrangements or other relationships with unconsolidated
entities or persons that could materially affect the Trusts liquidity or the availability of
capital resources.
Future Trust Distributions to Unitholders
On August 5, 2011, the Trustee announced the Trust distribution of net profits for the second
quarterly payment period in 2011. Unitholders of record on August 19, 2011 are expected to receive
a distribution amounting to $11.4 million or $0.824101 per Trust unit, which is payable on or
before August 29, 2011. This distribution is expected to consist of net cash proceeds of $11.7
million paid by Whiting to the Trust, which is inclusive of cash receipts totaling $667,923 (90% of
$742,137) for commodity derivative contracts settled from April through June 2011, less a provision
of $175,000 for estimated Trust expenses and $83,766 for Montana state income tax withholdings.
New Accounting Pronouncements
There were no accounting pronouncements issued during the six months ended June 30, 2011 applicable
to the Trust or its financial statements.
Critical Accounting Policies and Estimates
A disclosure of critical accounting policies and the more significant judgments and estimates used
in the preparation of the Trusts financial statements is included in Item 7 of the Trusts Annual
Report on Form 10-K for the year ended December 31, 2010. There have been no significant changes to
the critical accounting policies during the six months ended June 30, 2011.
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
Commodity Hedge Contracts
The primary asset of and source of income to the Trust is the term NPI, which generally entitles
the Trust to receive 90% of the net proceeds from oil and gas production from the underlying
properties. Consequently, the Trust is exposed to market risk from fluctuations in oil and gas
prices. Through 2012, however, the NPI is subject to commodity hedge contracts in the form of
costless collars entered into by Whiting, which reduce its exposure to commodity price volatility.
The Trust does not enter into derivative contracts for speculative or trading purposes.
The revenues derived from the underlying properties depend substantially on prevailing crude oil,
natural gas and natural gas liquid prices. As a result, commodity prices also affect the amount of
cash flow available for distribution to the Trust unitholders. Lower prices may also reduce the
amount of oil, natural gas and natural gas liquids that Whiting can economically produce. Whiting
sells the oil, natural gas and natural gas liquid production from the underlying properties under
floating market price contracts each month. Whiting has entered into certain hedge contracts
through December 31, 2012 to manage the exposure to crude oil and natural gas price volatility,
which is associated with revenues generated from the underlying properties, and to achieve more
predictable cash flows. However, these contracts limit the amount of cash available for
distribution if prices increase above the fixed ceilings. The hedge contracts consist of costless
collar arrangements placed with a single trading counterparty, JPMorgan Chase Bank National
Association. Whiting cannot provide assurance that this trading counterparty will not become a
credit risk in the future. No additional hedges are allowed to be placed on Trust assets.
Crude oil costless collar arrangements settle based on the average of the closing settlement price
for each commodity business day in the contract period. Natural gas costless collar arrangements
settle based on the closing settlement price on the second to last scheduled trading day of the
month prior to delivery. In a collar arrangement, the counterparty is required to make a payment to
Whiting for the difference between the fixed floor price and the settlement price if the settlement
price is below the fixed floor price. Whiting is required to make a payment to the hedge
counterparty for the difference between the fixed ceiling price and the settlement price if the
settlement price is above the fixed ceiling price. Whitings crude oil and natural gas price risk
management positions in collar arrangements through December 31, 2012 (which collars have the
potential to affect Whitings future distributions to the Trust) are as follows:
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Oil Collars | Natural Gas Collars | |||||||||||||||
Weighted | Weighted | |||||||||||||||
Average Price | Average Price | |||||||||||||||
Volumes | (per Bbl) | Volumes | (per Mcf) | |||||||||||||
(Bbls) | Floor / Ceiling | (Mcf) | Floor / Ceiling | |||||||||||||
Three Months Ending September 30, 2011 |
117,510 | $ | 74.00/$140.15 | 444,489 | $ | 6.00/$13.65 | ||||||||||
Three Months Ending December 31, 2011 |
114,726 | $ | 74.00/$140.75 | 428,361 | $ | 7.00/$14.25 | ||||||||||
Three Months Ending March 31, 2012 |
112,236 | $ | 74.00/$141.27 | 413,820 | $ | 7.00/$15.55 | ||||||||||
Three Months Ending June 30, 2012 |
109,716 | $ | 74.00/$141.73 | 402,609 | $ | 6.00/$13.60 | ||||||||||
Three Months Ending September 30, 2012 |
107,226 | $ | 74.00/$141.70 | 390,519 | $ | 6.00/$14.45 | ||||||||||
Three Months Ending December 31, 2012 |
105,084 | $ | 74.00/$142.21 | 379,839 | $ | 7.00/$13.40 |
The collared hedges shown above have the effect of providing a protective floor while allowing
Trust unitholders to share in upward price movements. Consequently, while these hedges are designed
to decrease exposure to price decreases, they also have the effect of limiting the benefit of price
increases beyond the ceiling. For the crude oil contracts listed above, a hypothetical $10.00
change in the NYMEX price above the ceiling price or below the floor price applied to the notional
amounts would cause an aggregate change in the cash settlement payments (gains received) on all oil
commodity derivatives of $6.7 million to Whiting, of which 90% would be transferred to the Trust.
For the natural gas contracts listed above, a hypothetical $1.00 change in the NYMEX price above
the ceiling price or below the floor price applied to the notional amounts would cause an aggregate
change in the cash settlement payments (gains received) on all natural gas commodity derivatives of
$2.5 million to Whiting, of which 90% would be transferred to the Trust. These hypothetical cash
settlement payments (gains received) would be recognized as contracts expire in future periods
through 2012.
The amounts received by Whiting from the counterparty upon settlements of these hedge contracts
will reduce the operating expenses related to the underlying properties when calculating the net
proceeds. However, if the hedge payments received by Whiting under the hedge contracts and other
non-production revenue exceed operating expenses during a quarterly period, the ability to use such
excess amounts to offset operating expenses may be deferred, with interest accruing on such amounts
at the prevailing money market rate, until the next quarterly period where the hedge payments and
the other non-production revenue are less than such expenses. In addition, the aggregate amounts
paid by Whiting on settlement of the hedge contracts will reduce the amount of net proceeds paid to
the Trust.
Item 4. | Controls and Procedures. |
Evaluation of Disclosure Controls and Procedures. The Trustee maintains disclosure controls and
procedures designed to ensure that information required to be disclosed by the Trust in the reports
that it files or submits under the Securities Exchange Act of 1934, as amended, is recorded,
processed, summarized and reported within the time periods specified in the SECs rules and
regulations promulgated by the SEC. Disclosure controls and procedures include controls and
procedures designed to ensure that information required to be disclosed by the Trust is accumulated
and communicated by Whiting to The Bank of New York Mellon Trust Company, N.A., as Trustee of the
Trust, and its employees who participate in the preparation of the Trusts periodic reports as
appropriate to allow timely decisions regarding required disclosure.
As of the end of the period covered by this report, the Trustee carried out an evaluation of the
Trustees disclosure controls and procedures. Mike Ulrich, as Trust Officer of the Trustee, has
concluded that the disclosure controls and procedures of the Trust are effective.
Due to the contractual arrangements of (i) the Trust agreement and (ii) the conveyance of the NPI,
the Trustee relies on (A) information provided by Whiting, including historical operating data,
plans for future operating and capital expenditures, reserve information and information relating
to projected production, and (B) conclusions and reports regarding reserves by the Trusts
independent reserve engineers. For a description of certain risks relating to these arrangements
and risks relating to the Trustees reliance on information reported by Whiting and included in the
Trusts results of operations, see the Trusts Annual Report on Form 10-K for the fiscal year ended
December 31, 2010, Item 1A. Risk Factors -The Trust and the Trust unitholders have no voting or
managerial rights with respect to the underlying properties. As a result, neither the Trust nor the
unitholders have any ability to influence the operation of the underlying properties.
Changes in Internal Control over Financial Reporting. During the quarter ended June 30, 2011, there
has been no change in the Trustees internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Trustees internal control over
financial reporting relating to the Trust. The Trustee notes for purposes of clarification that it
has no authority over, and makes no statement concerning, the internal control over financial
reporting of Whiting.
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PART II-OTHER INFORMATION
Item 1A. | Risk Factors. |
Risk factors relating to the Trust are contained in Item 1A of the Trusts Annual Report on Form
10-K for the fiscal year ended December 31, 2010. No material change to such risk factors has
occurred during the six months ended June 30, 2011.
Item 6. | Exhibits. |
The exhibits listed in the accompanying index to exhibits are filed as part of the Quarterly Report
on Form 10-Q.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
WHITING USA TRUST I |
||||
By: | THE BANK OF NEW YORK MELLON TRUST | |||
COMPANY, N.A. | ||||
By: | /s/ MIKE ULRICH | |||
Mike Ulrich | ||||
Vice President | ||||
Date: August 5, 2011
The Registrant, Whiting USA Trust I, has no principal executive officer, principal financial
officer, board of directors or persons performing similar functions. Accordingly, no additional
signatures are available, and none have been provided. In signing the report above, the Trustee
does not imply that it has performed any such function or that such function exists pursuant to the
terms of the Trust agreement under which it serves.
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EXHIBIT INDEX
Exhibit | ||||
Number | Description | |||
3.1*
|
| Certificate of Trust of Whiting USA Trust I [Incorporated herein by reference to Exhibit 3.4 to the Registration Statement on Form S-1 (Registration No. 333-147543)] | ||
3.2*
|
| Amended and Restated Trust Agreement, dated April 30, 2008, among Whiting Oil and Gas Corporation, Equity Oil Company (subsequently merged into Whiting Oil and Gas Corporation), The Bank of New York Mellon Trust Company, N.A. (f/k/a The Bank of New York Trust Co., N.A.) as Trustee and Wilmington Trust Company as Delaware Trustee. [Incorporated herein by reference to Exhibit 3.1 to the Trusts Current Report on Form 8-K filed on April 30, 2008 (File No. 001-34026)] | ||
10.1*
|
| Conveyance of Net Profits Interest, dated April 30, 2008, from Whiting Oil and Gas Corporation and Equity Oil Company (subsequently merged into Whiting Oil and Gas Corporation), to The Bank of New York Mellon Trust Company, N.A. (f/k/a The Bank of New York Trust Co., N.A.) as Trustee of Whiting USA Trust I. [Incorporated herein by reference to Exhibit 10.1 to the Trusts Current Report on Form 8-K filed on April 30, 2008 (File No. 001-34026)] | ||
10.2*
|
| Administrative Services Agreement, dated April 30, 2008, by and between Whiting Oil and Gas Corporation and The Bank of New York Mellon Trust Company, N.A. (f/k/a The Bank of New York Trust Co., N.A.) as Trustee of Whiting USA Trust I. [Incorporated herein by reference to Exhibit 10.2 to the Trusts Current Report on Form 8-K filed on April 30, 2008 (File No. 001-34026)] | ||
10.3*
|
| Registration Rights Agreement, dated April 30, 2008, by and between Whiting Petroleum Corporation and The Bank of New York Mellon Trust Company, N.A. (f/k/a The Bank of New York Trust Co., N.A.) as Trustee of Whiting USA Trust I. [Incorporated herein by reference to Exhibit 10.3 to the Trusts Current Report on Form 8-K filed on April 30, 2008 (File No. 001-34026)] | ||
31
|
| Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
32
|
| Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
(* Asterisk indicates exhibit previously filed with the SEC and incorporated herein by reference.) |
20