SandRidge Permian Trust Announces Distribution of $0.603032 Per Unit

  SandRidge Permian Trust Announces Distribution of $0.603032 Per Unit

Business Wire

AUSTIN, Texas -- January 31, 2013

SANDRIDGE PERMIAN TRUST (NYSE: PER) today announced a quarterly distribution
for the three-month period ended December 31, 2012 (which primarily relates to
production attributable to the Trust’s interests from September 1, 2012
through November30, 2012) of $31.7 million, or $0.603032 per unit. The Trust
makes distributions on a quarterly basis approximately 60 days after the end
of each quarter. The distribution is expected to occur on or before March1,
2013 to holders of record as of the close of business on February14, 2013.

During the three-month production period ended November 30, 2012, total sales
volumes decreased 7% from the previous three-month period. The lower volume
was primarily due to bringing fewer wells on production versus the previous
period. This was mainly driven by a reduction in rig count: four to five
drilling rigs were utilized in the previous period versus an average of three
rigs in this period. In addition, the number of development wells awaiting
completion increased by 9.3 wells from the previous period. It is anticipated
that this inventory will return to its previous levels in the upcoming
distribution periods. The lower production was partly offset by higher
realized prices. The realized oil price, including the impact of hedges and
natural gas liquids, was 2% higher compared to the previous period. The
realized gas price increased 15% over the previous period. Overall, the
period’s results generated a 3% lower distribution per unit than the target.

The Trust owns royalty interests created from interests held by SandRidge
Energy, Inc. (“SandRidge”) and its subsidiaries in oil and natural gas
properties in the Central Basin Platform of the Permian Basin in Andrews
County, Texas and is entitled to receive proceeds from the sale of production
attributable to the royalty interests. As described in the Trust’s filings
with the Securities and Exchange Commission (the “SEC”), the amount of the
quarterly distributions is expected to fluctuate from quarter to quarter,
depending on the proceeds received by the Trust as a result of actual
production volumes, oil and natural gas prices and the amount and timing of
the Trust’s administrative expenses, among other factors. Although there is no
assurance of any minimum distribution in any quarterly period, during the
subordination period (as described in the Trust’s filings), holders of Common
Units will be entitled to receive an amount up to the “Subordination
Threshold” (which varies from quarter to quarter) prior to any distribution
being made for that quarter in respect of the Subordinated Units, all of which
are held by SandRidge. If the amount available for distribution in any
quarterly period is sufficient to distribute an amount equal to the
Subordination Threshold to the holders of all units (including the
Subordinated Units), any additional balance is distributed to holders of all
units pro rata, up to the amount of the Incentive Threshold for the quarter.
Trust units are entitled to receive 50% of any cash available for distribution
in excess of the Incentive Threshold for the quarter. The announced
distribution exceeded the Subordination Threshold, but not the Incentive
Threshold, for the quarter.

Volumes, price and distributable income available to unitholders for the
period were (dollars in thousands, except per unit):

                                                                  
Sales Volumes
Oil (MBbl) (1)                                                        374
Gas (MMcf)                                                            95
Combined (MBoe)                                                       390
Average Price
Oil (per Bbl) (1)                                                   $ 81.13
Gas (per Mcf)                                                       $ 2.49
Average Price - including impact of derivative settlements and
post-production expenses
Oil (per Bbl) (1)                                                   $ 90.26
Gas (per Mcf)                                                       $ 2.26
Revenues
Royalty income                                                      $ 30,605
Derivative settlements                                                3,415
Expenses                                                             2,361
Distributable income available to unitholders                       $ 31,659
Distributable income per unit (52,500,000 units issued and          $ 0.603032
outstanding)

(1)   Includes natural gas liquids.

In addition to wells that were producing at the effective date of the
assignment of the royalty interests to the Trust, SandRidge, pursuant to a
development agreement with the Trust, is obligated to drill, or cause to be
drilled, the equivalent of 888 development wells, determined by reference to
SandRidge’s net revenue interest in a well, in an area of mutual interest on
or before March31, 2016.

During the three-month production period ended November 30, 2012, three
drilling rigs were utilized to drill development wells for the Trust.
Currently, three rigs are drilling Trust development wells, and the present
plan is to continue the three rig program through 2013. To date, equivalent
development wells producing, or drilled and perforated for completion, during
production periods upon which distributions are based are as follows:

As of       Equivalent Producing  Additional Drilled  Total Development
             Development Wells      Development Wells*   Wells
8/31/2011    85.2                   20.7                 105.9
11/30/2011   159.7                  18.8                 178.5
2/29/2012    219.3                  16.2                 235.5
5/31/2012    300.9                  18.3                 319.2
8/31/2012    381.5                  20.2                 401.7
11/30/2012   424.5                  29.5                 454.0

*Equivalent development wells that are not producing at the ‘As of’ date but
have been drilled and perforated for completion.

Pursuant to IRC Section 1446, withholding tax on income effectively connected
to a United States trade or business allocated to foreign partners should be
made at the highest marginal rate. Under Section 1441, withholding tax on
fixed, determinable, annual, periodic income from United States sources
allocated to foreign partners should be made at 30% of gross income unless the
rate is reduced by treaty. This is intended to be a qualified notice by
SandRidge Permian Trust to nominees and brokers as provided for under Treasury
Regulation Section 1.1446-4(b), and while specific relief is not specified for
Section 1441 income, this disclosure is intended to suffice. Nominees and
brokers should withhold at the highest marginal rate, currently 39.6% for
individuals, on the distribution made to foreign partners.

This press release contains statements that are “forward-looking statements”
within the meaning of Section21E of the Securities Exchange Act of 1934, as
amended. All statements contained in this press release, other than statements
of historical facts, are “forward-looking statements” for purposes of these
provisions. These forward-looking statements include the amount and date of
any anticipated distribution to unit holders. The anticipated distribution is
based, in part, on the amount of cash received or expected to be received by
the Trust from SandRidge with respect to the relevant period. Any differences
in actual cash receipts by the Trust could affect this distributable amount.
Other important factors that could cause actual results to differ materially
include expenses of the Trust and reserves for anticipated future expenses.
Statements made in this press release are qualified by the cautionary
statements made in this press release. Neither SandRidge nor the Trustee
intends, and neither assumes any obligation, to update any of the statements
included in this press release. An investment in Common Units issued by
SandRidge Permian Trust is subject to the risks described in the Trust’s
Annual Report on Form 10-K for the year ended December31, 2011, and all of
its other filings with the SEC. The Trust’s quarterly and other filed reports
are or will be available over the Internet at the SEC’s web site at
http://www.sec.gov.

Contact:

SandRidge Permian Trust
The Bank of New York Mellon Trust Company, N.A., as Trustee
Sarah Newell, 1-512-236-6531
 
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