Gulf Coast Ultra Deep Royalty Trust (GULTU) company history: the story so far

History

Created in 2013 to hold a 5% royalty on Freeport-McMoRan's ultra-deep Gulf Coast prospects, the trust was delisted from Nasdaq in 2015 and now trades on OTCQX.

2012-2013: A trust built for a takeover

Gulf Coast Ultra Deep Royalty Trust began on 28 December 2012, when Freeport-McMoRan Copper & Gold registered it to issue royalty units as part of its $3.5 billion acquisition of McMoRan Exploration Co. (MMR). Each MMR share was to convert into $14.75 in cash plus 1.15 trust units, giving shareholders a royalty on MMR's ultra-deep Gulf Coast exploration prospects.

The registration was amended several times in the following months. In February 2013 it added a pro forma statement of the trust and a table of officers and directors shared by Freeport-McMoRan, McMoRan Exploration and Plains Exploration, the conflict at the centre of the deal. In March it disclosed that Freeport's directors and officers held about 6.2% of McMoRan, and that the reserve models behind the units, prepared by Ryder Scott, assumed every ultra-deep well drilled would succeed.

By April the vote was set, with a record date of April 4 and 163,100,608 McMoRan shares eligible. Freeport and Plains Exploration, which held 51 million shares under a voting agreement, together made up about 36.8% of the register. McMoRan owed Freeport a $98 million break fee if it left for a rival bid. On April 30 a letter agreement narrowed the charter change so that Freeport was carved out of the "interested stockholder" definition only for this transaction.

The merger closed in early June 2013. McMoRan Oil & Gas conveyed the trust a 5% gross overriding royalty, free of drilling and development costs, on 20 ultra-deep prospects: 17 offshore and 3 onshore in Louisiana, including Highlander and Davy Jones. The trust had no say over exploration or development decisions.

2014-2015: Listing, a troubled well and delisting

In May 2014 Nasdaq certified the trust's securities for listing, clearing them to trade. The record then jumps to 2015, with nothing in between.

The trust's main hope was Highlander. Tested at 75 MMcf/day gross (a measure of gas flow) in February 2015, the well was producing at only about 22 MMcf/day by July because processing capacity had not caught up. On 23 July it was shut in for remedial workover, a repair to the well. Freeport-McMoRan said it was building more processing capacity and considering a second well location on the structure.

The trust's own listing then slipped away. In October 2015 it failed to regain Nasdaq compliance within its 180-day window and its units became subject to delisting. It chose not to appeal. Nasdaq suspended trading on October 16 and the units were formally delisted effective November 2, after which they traded on the OTCQX market.

2016-2026: A quiet record

The major beats record nothing after the delisting, and none shows how the Highlander workover turned out. The latest context notes that large early holders, including Mount Kellett Capital, Lloyd I. Miller III, Freeport-McMoRan itself, Neil S. Subin and Magnolia Oil & Gas, mostly exited over time, and that the auditor changed from Ernst & Young to Weaver and Tidwell in August 2024 with no disagreements.

As of 13 August 2026, the trust was a passive vehicle traded on OTCQX, holding its 5% royalty on the 20 prospects. Freeport-McMoRan, through McMoRan Oil & Gas, remained sole operator and decided whether and how to drill.

Written from the 11 story beats below (2012 to 23 Oct 2015), which come from the company's own announcements and filings.

Beat by beat

The events that changed the company's story, in plain English, each written against everything known about the company at the time. The dot shows whether it was good, bad or neutral for shareholders.

2015

23 Oct
Gulf Coast Ultra Deep Royalty Trust's exchange filed to remove a class of its securities from listing.
listing compliance notice
23 Oct
Rather than appeal, the trust let the delisting proceed: Nasdaq suspended trading October 16, 2015 and the units were formally delisted effective November 2, moving to trade on the OTCQX market instead.
listing compliance notice
8 Oct
The trust failed to regain Nasdaq compliance within its 180-day window, and its units became subject to delisting from the Nasdaq Capital Market.
listing compliance notice
23 July
The trust's Highlander well - producing at a restricted rate of about 22 MMcf/day gross versus the 75 MMcf/day tested in February 2015 because processing capacity hadn't caught up - was shut in for remedial wellbore workover; Freeport-McMoRan said it was building more processing capacity and eyeing a second well location on the structure.
drilling progress report

2014

30 May
Nasdaq certified Gulf Coast Ultra Deep Royalty Trust's securities for listing, clearing them to begin trading.
listing compliance notice

2013

4 June
The Freeport-McMoRan/MMR merger closed: each MMR share converted into $14.75 cash plus 1.15 Gulf Coast Ultra Deep Royalty Trust units, and McMoRan Oil & Gas conveyed the trust a 5% gross overriding royalty - free of drilling and development costs - on 20 ultra-deep exploration prospects (17 offshore, 3 onshore Louisiana), including Highlander and Davy Jones. The trust has no say over exploration or development decisions.
capital raising announcement
30 Apr
By Amendment No. 7 the parties had signed a letter agreement narrowing the charter amendment McMoRan shareholders were being asked to approve: Freeport is carved out of the "interested stockholder" definition only for the purposes of this transaction rather than for all purposes, so the Delaware protection stays in place against Freeport in any future dealing. The remaining Ryder Scott reports were filed with it. Amendments 4 and 5 to this registration are not in the corpus, so some of these changes may have first appeared there.
business combination
18 Apr
Amendment No. 4 set the vote up: an April 4, 2013 record date against 163,100,608 McMoRan shares, with the 'interested stockholders' - Freeport-McMoRan itself and Plains Exploration, which alone held 51 million shares or 31.3% under a voting agreement - accounting for about 36.8% of the register. Because Freeport counted as an interested stockholder under McMoRan's own charter, the charter amendment had to pass alongside the merger; McMoRan owes Freeport a $98 million break fee if it walks to a rival bid.
business combination
12 Mar
Amendment No. 2 put numbers on the conflict and a caveat on the reserves. Freeport's directors and officers as a group held 10,156,667 McMoRan shares, about 6.2% of the company, 5.6% of it in the hands of people who count as Freeport interested stockholders. And the reserve models behind the royalty units, prepared by Ryder Scott as at 1 July 2012 off McMoRan data updated in October, assume that every ultra-deep exploration and development well drilled is a success.
business combination
8 Feb
Amendment No. 1 added the two things that made the deal legible. First, a pro forma statement of the trust itself, showing what it would hold once it received the 5% overriding royalty on McMoRan's ultra-deep prospects. Second, a table of the overlapping officers and directors among Freeport-McMoRan, McMoRan Exploration and Plains Exploration -- the conflict at the centre of a transaction between companies that shared their senior people.
business combination

2012

28 Dec
Freeport-McMoRan Copper & Gold registered a new entity, Gulf Coast Ultra Deep Royalty Trust, to issue royalty trust units as part of its $3.5 billion, cash-plus-units acquisition of McMoRan Exploration Co. - each MMR share was to convert into $14.75 cash plus 1.15 trust units representing a royalty on MMR's ultra-deep Gulf Coast exploration prospects.
business combination