LL&E Royalty Trust Announces Trust Income for March 2002

Business Wire, Feb 22, 2002

Business/Energy Editors

HOUSTON--(BUSINESS WIRE)--Feb. 22, 2002

LL&E Royalty Trust (NYSE:LRT) announced today the Trust income distribution for the month of March 2002. This distribution represents amounts payable to the Trust with respect to production for the month of December 2001. Unit holders of record on March 5, 2002 will receive a distribution of $197,186.12 or approximately $.010383 per Unit payable on March 15, 2002.

The Working Interest Owner, under the terms of the Trust Conveyance, is permitted to escrow funds up to 125% of the estimated future costs such as dismantlement costs and capital expenditures for the properties in which the Trust has an interest (Special Cost Escrow). According to the most recent reserve report, estimated dismantlement costs are $8.8 million for Jay Field property, $2.4 million for South Pass 89 property and $2.3 million for Offshore Louisiana property. The Working Interest Owner has informed the Trustee that it has elected not to escrow any additional funds at this time. However, the Working Interest Owner intends to continue to monitor each of the properties in which the Trust has an interest for possible changes in relevant factors which may warrant a need for additional escrow. To date, the amounts escrowed for future dismantlement costs total approximately $4,543,402 for Jay Field property, $2,600,000 for South Pass 89 property and $3,000,000 for the Offshore Louisiana property. The amount escrowed on the Offshore Louisiana property exceeds 125% of the estimated future dismantlement costs by approximately $125,000. The Trust Conveyance permits, but does not require, the Working Interest Owner to release the excess escrowed funds, and the Working Interest Owner has informed the Trustee that it does not intend to release any portion of the escrowed funds at this time.

The distribution includes no proceeds from the Jay Field and Offshore Louisiana properties due to excess production costs. The Jay Field excess production costs are primarily the result of higher capital expenditures associated with drilling costs related to the McDavid Lands 37-5 well as well as higher costs associated with tubing upsize projects and nitrogen purchases. The Offshore Louisiana excess production costs are primarily due to capital expenditures related to the drilling and completion of a new well at South Marsh Island 76. Excess production costs to be recouped from future proceeds at the Jay Field and Offshore Louisiana properties total $2,169,709 and $1,872,477 respectively.

Gross Proceeds prior to deductions for Production Costs for the month of December 2001 by property is as follows: approximately $1,325,185 for Jay Field property, approximately $608,788 for South Pass 89 property, and approximately $388,987 for Offshore Louisiana Property.

Production Costs for the month of December 2001 by property is as follows: approximately $3,494,894 for Jay Field property, approximately $123,991 for South Pass 89 property, and approximately $2,261,464 for Offshore Louisiana Property.

There was no deduction made for the Special Cost Escrow in December 2001. Fee Lands Royalties for the month of December 2001 totaled approximately $21,205. Trust related expenses for the month of February 2002 totaled approximately $66,417.

The Gross Proceeds, Production Costs and Special Cost Escrow numbers stated above relate to each property as a whole. The Trust's interest in these properties is 50% for Jay Field, 50% for South Pass 89 and 90% for Offshore Louisiana.

The extent of future distributions from the properties in which the Trust has an interest will continue to be dependent on normal factors associated with oil and gas operations such as oil and gas production levels, prices and associated cost, timing and extent of capital expenditures. In addition, the amount of future distributions will depend on the amounts escrowed by the Working Interest Owner as described above.

The trust income distribution announcement for the month of April will be made on or about March 26, 2002.