711303--3/31/2006--MESA_OFFSHORE

related topics

{interest, director, officer}

{loss, insurance, financial}

{gas, price, oil}

{operation, international, foreign}

{cost, contract, operation}

Natural gas and oil prices fluctuate due to a number of factors, and lower prices will reduce net proceeds available to the Trust and distributions to Trust unitholders. Increased production and development costs for the Royalty will result in decreased Trust distributions. Trust reserve estimates depend on many assumptions that may prove to be inaccurate, which could cause both estimates of reserves and estimated future revenues to be too high or too low. Estimates and accruals of costs by PNR may be greater or lesser than future estimated or actual costs. Operating risks for the working interest owners interests in the Royalty Properties can adversely affect Trust distributions. The operators of the working interests are subject to extensive governmental regulation. None of the Trustee, the Trust nor its unitholders control the operation or development of the Royalty Properties and have little influence over operation or development. The Trustee relies upon the working interest owners and managing general partner for information regarding the Royalty Properties. The owner of any Royalty Property may abandon any property, terminating the related Royalty. The Royalty will be sold and the Trust is being terminated. Trust assets are depleting assets and, if the working interest owners or other operators of the Royalty Properties do not perform additional development projects, the assets may deplete faster than expected. Unitholders have limited voting rights. Unitholders have limited ability to enforce the Trust s rights against the current or future owners of the Royalty Properties.

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711303--3/31/2006--MESA_OFFSHORE_TRUST