The following is a glossary of certain defined terms used in this Annual Report on Form 10-K.
GLOSSARY
| Bcf | Billion cubic feet (of natural gas) |
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| BOE | Barrel of oil equivalent |
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| gross acres or gross wells | The total acres or wells, as the case may be, in which a working interest is owned |
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| Mcf | Thousand cubic feet (of natural gas) |
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| MMBtu | One million British Thermal Units, a common energy measurement |
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| net acres or net wells | The sum of the fractional working interests owned in gross acres or wells, as the case may be |
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| net proceeds | Gross proceeds received by XTO Energy from sale of production from the underlying properties, less applicable costs, as defined in the net profits interest conveyances |
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| net profits income | Net proceeds multiplied by the applicable net profits percentage of 75% or 90%, which is paid to the Trust by XTO Energy. “Net profits income” is referred to as “royalty income” for income tax purposes. |
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| net profits interest | An interest in an oil and gas property measured by net profits from the sale of production, rather than a specific portion of production. The following defined net profits interests were conveyed to the Trust from the underlying properties: |
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90% net profits interests—interests that entitle the Trust to receive 90% of the net proceeds from the underlying properties that are substantially all royalty or overriding royalty interests in Texas, Oklahoma and New Mexico
75% net profits interests—interests that entitle the Trust to receive 75% of the net proceeds from the underlying properties that are working interests in Texas and Oklahoma
| royalty interest (and overriding royalty interest) | A non-operating interest in an oil and gas property that provides the owner a specified share of production without any production expense or development costs |
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| underlying properties | XTO Energy’s interest in certain oil and gas properties from which the net profits interests were conveyed. The underlying properties include royalty and overriding royalty interests in producing and nonproducing properties in Texas, Oklahoma and New Mexico, and working interests in producing properties located in Texas and Oklahoma. |
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| working interest | An operating interest in an oil and gas property that provides the owner a specified share of production that is subject to all production expense and development costs |
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