Futures Connection. Royalty Trust Next Twelve Months Distributions and One-Year Natural Gas Futures. HGT SJT 12 Month Natural Gas 5/2/02 4/4/02

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1 Futures Connection Summary and Recommendation It is of little surprise that estimates of Next Twelve Months Distributions track closely one-year natural gas futures, a.k.a. the 12-month strip (see Chart). The latter is the most volatile input to our calculation of the former. Thus, investors that track the real time trend of the 12-month strip for natural gas have a real time indicator of estimated NTM distributions. Yet, stock price only partly tracks expectations for the year ahead. In recent weeks, estimated NTM distributions, one-year futures and royalty trust stock prices recovered to the six-year futures trend. On current six-year futures, the pricing of SJT, HGT and CRT imply an attractive long-term rate of return, in our opinion. Moreover, we think six-year natural gas futures have potential to advance further relative to oil. Kurt H. Wulff, CFA NTM Distributions ($/unit) /28/01 1/11/02 Royalty Trust Next Twelve Months Distributions and One-Year Natural Gas Futures HGT SJT 12 Month Natural Gas 1/25/02 2/8/02 2/22/02 3/8/02 3/22/02 4/4/02 4/18/02 5/2/02 5/16/02 5/30/02 6/13/02 6/27/02 7/11/02 7/25/02 8/8/02 8/22/ He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 1 Natural Gas ($/mmbtu)

2 Rank by McDep Ratio: Market Cap and Debt to Present Value Net ($/sh) Market Present Debt/ Symbol/ 29-Aug Shares Cap Value Present McDep Rating 2002 (mm) ($mm) ($/sh) Value Ratio Cross Timbers Royalty Trust CRT San Juan Basin Royalty Trust SJT B Hugoton RoyaltyTrust (46%) HGT Buy/Sell rating after symbol: B - Buy, N - Neutral, S - Sell McDep Ratio = Market cap and Debt to present value of oil and gas and other businesses Rank by EV/Ebitda: Enterprise Value to Earnings Before Interest, Tax, Deprec. Dividend or ($/sh) EV/ EV/ Distribution PV/ Symbol/ 29-Aug Sales Ebitda P/E NTM Ebitda Rating 2002 NTM NTM NTM (%) NTM Cross Timbers Royalty Trust CRT San Juan Basin Royalty Trust SJT B Hugoton RoyaltyTrust (46%) HGT EV = Enterprise Value = Market Cap and Debt; Ebitda = Earnings before interest, tax, depreciation and amortization; NTM = Next Twelve Months Ended September 30, 2003; P/E = Stock to Earnings; PV = Present Value of oil and gas and other businesses Royalty Trust Stock and Six-Year Natural Gas Futures Stock ($/unit) /28/01 1/11/02 HGT SJT 72 Month Natural Gas 1/25/02 2/8/02 2/22/02 3/8/02 3/22/02 4/4/02 4/18/02 5/2/02 5/16/02 5/30/02 6/13/02 6/27/02 7/11/02 7/25/02 8/8/02 8/22/ He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes Natural Gas ($/mmbtu)

3 Table CRT-1 Cross Timbers Royalty Trust Present Value Decline (%/yr): 10 Escalation post 2007 (%/yr): 2.5 Enhancement (%/yr): 10 Discount Rate (%/yr): 5.6 U.S. TIPS Inflation (%/yr): 1.7 U.S. 10 Year Yield (%/yr): 4.2 PV/ ($/mcf): 2.72 PV/EBITDA 2002: 10.4 Natural Gas Oil Tax Present Basic Enhanced Total Revenue Net Distribution Credit Disc Value Year (bcf) (bcf) (bcf) ($/mcf) ($mm) ($mm) ($mm) ($/unit) ($/unit) Factor ($/unit) Total 2003 through 2032; years ending on 9/ He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 3

4 Table CRT-2 Cross Timbers Royalty Trust Distributable Income Next Twelve Q1 Q2 Q3E Q4E Year Q1E Q2E Q3E Months 3/31/02 6/30/02 9/30/02 12/31/ E 3/31/03 6/30/03 9/30/03 9/30/03 Highlights Tax credit ($mm) Per unit Distributable Income ($mm) Per unit Units (millions) Natural Gas (bcf) Natural Gas (mmcfd) Days Oil (mb) Oil (mbd) Days Total (bcf) Natural Gas (HH lagged three months) Henry Hub ($/mmbtu) Differential ($/mmbtu) (0.13) (0.04) (0.00) CRT ($/mcf) Oil ($/bbl) (WTI lagged two months) WTI Cushing CRT Total ($/mcf) Revenue ($mm) Natural Gas Oil Total Cost ($mm) Tax, transport & other Production Total Cash flow ($mm) Development Excess (0.07) 0.07 Net proceeds ($mm) Royalty income ($mm) Royalty/Net proceeds 89% 89% 89% 89% 89% 89% 89% 89% 89% Administration Distributable income ($mm) He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 4

5 Table HGT-1 Hugoton Royalty Trust Present Value Decline (%/yr): 10 Escalation Post 2007 (%/yr): 2.5 Enhancement (%/yr): 10 Discount rate (%/yr): 6.2 Capex/Cash Flow (%): 30 U.S. TIPS Inflation (%/yr): 1.7 Variable Cost (%): 17 U.S. 10 Year Yield (%/yr): 4.2 PV/ ($/mcf): 1.25 PV/EBITDA 2002: 9.9 Fixed Var Cap Tax Present Basic Enhanced Total Revenue Cost Cost Ex Distribution Credit Disc Value Year (bcf) (bcf) (bcf) ($/mcf) ($mm) ($mm) ($mm) ($mm) ($mm) ($/unit) ($/unit) Factor ($/unit) Total 2003 through 2032; years ending on 9/ He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 5

6 Table HGT-2 Hugoton Royalty Trust Distributable Income Next Twelve Q1 Q2 Q3E Q4E Year Q1E Q2E Q3E Months 3/31/02 6/30/02 9/30/02 12/31/ E 3/31/03 6/30/03 9/30/03 9/30/03 Highlights Revenue ($mm) (80%) Cash flow ($mm) (80%) Per unit Tax credit ($mm) Per unit Distributable Income ($mm) Per unit Units (millions) Natural Gas (bcf) Natural Gas (mmcfd) Days Oil (mb) Oil (mbd) Days Total (bcf) Natural Gas (HH lagged two months) Henry Hub ($/mmbtu) Differential ($/mmbtu) (0.03) HGT ($/mcf) Oil ($/bbl) (WTI Cushing lagged two months) WTI Cushing HGT Total ($/mcf) Revenue ($mm) Natural Gas Oil Total Cost ($mm) Tax, transport & other Production Overhead Total Cash flow ($mm) Development Net proceeds ($mm) Royalty income ($mm) Royalty/Net proceeds 80% 80% 80% 80% 80% 80% 80% 80% 80% Administration Distributable income ($mm) Cost ratios Tax and other/revenue 7% 9% 10% 10% 9% 10% 10% 10% 10% Production cost ($/mcf) Overhead cost ($/mcf) Development/Cash flow He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 6

7 Table SJT-1 San Juan Basin Royalty Trust Present Value Decline (%/yr): 10 Escalation Post 2007 (%/yr): 2.5 Enhancement (%/yr): 10 Discount rate (%/yr): 6.2 Capex/Cash Flow (%): 25 U.S. TIPS Inflation (%/yr): 1.7 Variable Cost (%): 12 U.S. 10 Year Yield (%/yr): 4.2 PV/ ($/mcf): 1.32 PV/EBITDA 2002: 10.4 Fixed Var Cap Tax Present Basic Enhanced Total Revenue Cost Cost Ex Distribution Credit Disc Value Year (bcf) (bcf) (bcf) ($/mcf) ($mm) ($mm) ($mm) ($mm) ($mm) ($/unit) ($/unit) Factor ($/unit) Total 2003 through 2032; years ending on 9/ He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 7

8 Table SJT-2 San Juan Basin Royalty Trust Distributable Income Next Twelve Q1 Q2 Q3E Q4E Year Q1E Q2E Q3E Months 3/31/02 6/30/02 9/30/02 12/31/ E 3/31/03 6/30/03 9/30/03 9/30/03 Highlights Revenue ($mm) (75%) Cash flow ($mm) (75%) Per unit Tax credit ($mm) Per unit Distributable Income ($mm) Per unit Units (millions) Natural gas (mmbtu) Heat Content(btu/cf) 1,092 1, ,059 1,047 1,059 1,059 1,059 1,059 Natural gas (bcf) Natural Gas (mmcfd) Days Oil (mb) Oil (mbd) Total gas & oil (bcf) Natural gas ($/mmbtu) (Henry Hub lagged two months) Henry Hub ($/mmbtu) Differential (%) Total Natural gas ($/mcf) Oil ($/bbl) (WTI Cushing lagged two months) WTI Cushing SJT Total gas & oil ($/mcf) Revenue ($mm) Natural Gas Oil Total Cost ($mm) Severance tax Operating Total Cash flow ($mm) Development Net proceeds ($mm) Royalty income ($mm) Royalty/Net proceeds 75% 75% 75% 75% 75% 75% 75% 75% 3.0 Administration One-time Distributable income ($mm) Modeling ratios Severance tax/revenue 10.2% 9.5% 8.3% 9.7% 9.4% 10.0% 10.0% 10.0% 9.9% Operating cost ($/mcf) He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 8

9 Table SJT-3 San Juan Basin Royalty Trust Monthly Declarations May-02 Jun-02 Jul-02 Aug-02 Sep-02 Oct-02 Nov-02 Dec-02 Distribution ($/unit) Declared Projected Natural gas (mmbtu) Heat Content(btu/cf) 1,108 1,064 1, ,059 1,059 1,059 1,059 Natural gas (bcf) Natural Gas (mmcfd) Days Natural gas industry quotes lagged two months ($/mmbtu) Henry Hub Daily/Futures San Juan Monthly Index SJT/Henry Hub SJT/San Juan Index SJT ($/mmbtu) SJT ($/mcf) Revenue ($mm) Natural Gas Other 0.3 (0.4) (0.0) (0.2) (0.0) (0.0) (0.0) (0.0) Cost ($mm) Severance tax Operating Total Cash flow ($mm) Development (0.9) Net proceeds ($mm) Royalty income ($mm) Royalty/Net proceeds 75% 75% 75% 75% 75% 75% 75% 75% One time Distributable income ($mm) Units (millions) Distribution ($/unit) Latest Twelve Month Average Heat Content(btu/cf) 1,092 1,086 1,091 1,059 Natural Gas (mmcfd) SJT/Henry Hub SJT/San Juan Index Other revenue (0.0) (0.0) Operating Development Severance tax/revenue 10.4% 10.5% 10.2% 10.0% He and his spouse do not sell short nor act contrary to a buy or sell rating except for tax loss purposes. 9