December 3, 2001; Western Natural Gas Exceeds Benchmark for December

Our final commodity price observation has a bearing on the expected February declaration of monthly distribution for recommended San Juan Basin Royalty Trust.  The El Paso San Juan index for December appears likely to be about $2.30 per million btu's (see Chart on next page from Bloomberg).  Recent quotes for the Henry Hub in Louisiana, the reference pricing point for the industry, have been less than $2.00.  Perhaps the western producers will make up for ground lost with an artificially low index for October.

We have resisted publishing estimates of monthly distributions for SJT believing that the fluctuations could just as readily be misleading as helpful.  Look for a change in our practice before long.  For the time being one can see that the low index price for October points to a low distribution to be declared in December.  Perhaps some unsuspecting unitholders may sell on a low distribution.  The more relevant indicators to us are the pickup in price for January and February on the basis of history below, and the continued steep climb in futures for the next few years.

December 3, 2001; Meter Reader: After Enron