Cross Timbers Royalty Trust (CRT) is an express trust, publicly traded company that operates out of Fort Worth, Texas, USA. The Trust holds interest in certain producing and non-producing royalty and overriding royalty interest properties in Texas, Oklahoma, and New Mexico. CRT's operations are directed by the Trustee, The Bank of New York Mellon Trust Company, N.A., and it is responsible for distributing the revenues generated from these properties to the unitholders. Thus, CRT doesn't have traditional business operations or any employees of its own.
The company was established in 1991 with Southwestern Energy Production Company (SWEPCO), a subsidiary of XTO Energy, as the principal asset contributor. Cross Timbers Royalty Trust’s portfolio is comprised of about 90% natural gas and 10% crude oil reserves.
CRT's royalty interests serve as the primary source of income, and the revenues generated are distributed to unitholders monthly. The income metric of these distributions is primarily dependent upon the quantities of oil and natural gas produced from the Royalty Properties and their respective selling prices. Hence, the revenue and profitability of CRT largely depend on the current market prices for oil and gas and the amount of production from their properties.
CRT does not engage in any drilling or exploration activities instead, it relies on the efforts of operators who work on the properties in which CRT holds an interest. CRT is shielded from operation costs because its royalties are "cost-free," meaning it does not bear any direct operating expenses or development costs.
Cross Timbers Royalty Trust operates in a volatile industry, and the nature of its operations exposes it to the highs and lows of the energy market. Despite this, CRT has maintained steady performance over the years and remains a leading player in the industry. The Trust's performance is touted to be profitable to its investors, primarily due to its monthly distributions and its ability to gain exposure to gas and oil price changes from a diversified portfolio. Its commitment to responsible and ethical operations makes it a go-to choice for many investors in the energy market.