Hugoton Royalty Trust Present Value Boosted by Volume

Coincidentally our present value for HGT currently is equal to our PV for SJT at $14.80 per unit.  That is a gain of $0.50 per unit in a week instead of a slight decline.  A 2% increase in projected volume is the most important factor contributing to the increased value. Volumes in the last two monthly disclosures were the highest of the year. 

The volume statistics appear to reflect the impact of a heavy development program.  In fact there is a backlog of past development expenditures of $0.15 per unit that will be deducted from future distributions.  XTO Energy, the sponsor of the trust, decided to spread out development deductions to avoid the problem facing SJT holders currently.  Thus, HGT declared its latest monthly distribution at $.07 per unit, a level more indicative of normalized value than something artificially or temporarily lower. (For details on HGT and two other royalty trusts, see Meter Reader Tables, a companion weekly analysis available on www.mcdep.com)

November 26, 2001; Meter Reader: ConocoPhillipsBurlingtonMarathon