DALLAS, TX – February 19, 2026 – The San Juan Basin Royalty Trust, managed by Argent Trust Company, has received Hilcorp Energy Company’s proposed capital investment plan for 2026. Hilcorp, the operator of the Trust’s subject interests, has outlined a budget of approximately $14 million aimed at enhancing production and optimizing existing assets within the San Juan Basin.
The 2026 plan includes a total of 32 projects, with a significant portion dedicated to new drilling initiatives. An estimated $11.5 million is earmarked for nine new vertical drilling projects targeting the Mesaverde, Mancos, and Dakota formations. Additionally, six horizontal drilling projects are planned for the Mancos formation, reflecting a strategic focus on maximizing recovery from these key geological layers.
Beyond new drilling, the plan also allocates approximately $2 million for recompletion and workover operations in the Fruitland Coal and Pictured Cliffs formations. These efforts are crucial for rejuvenating older wells and extracting remaining reserves. A smaller segment of the budget, around $0.5 million, is designated for facilities projects, including natural gas compression and other essential infrastructure upgrades. Hilcorp has indicated that this plan is subject to adjustments based on evolving operational assumptions and market conditions.
This projected capital expenditure represents an increase from Hilcorp’s 2025 activities. For the entirety of 2025, Hilcorp reported actual capital expenditures of approximately $8.3 million. Of this amount, roughly $4 million was invested in seven drilling projects, while $4.3 million was allocated to 23 recompletion and workover projects. The 2026 plan suggests a more aggressive investment strategy, potentially signaling confidence in the region’s long-term production potential or a response to anticipated market dynamics.
The San Juan Basin Royalty Trust, as a passive entity, relies on the operational expertise and capital allocation decisions of its operator, Hilcorp. The Trustee’s role is to oversee these activities and ensure they align with the Trust’s objectives. The success of Hilcorp’s 2026 capital plan will directly impact the Trust’s future production volumes and, consequently, its royalty distributions to unitholders.
Investors and stakeholders will be closely monitoring the execution of this plan, as well as external factors that could influence operational outcomes. The energy sector remains susceptible to price volatility, regulatory shifts, and technological advancements. The Trust’s filings with the Securities and Exchange Commission provide further detail on the risks and uncertainties inherent in its business.
Original article, Author: Jam. If you wish to reprint this article, please indicate the source:https://aicnbc.com/19026.html
