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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
 þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended September 30, 2009
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the transition period from _____ to _____
 Commission File Number: 1-11608
 WILLIAMS COAL SEAM GAS ROYALTY TRUST
  Delaware
(State or other jurisdiction 
of incorporation or 
organization)
    
    75-6437433
(I.R.S. Employer
Identification No.)
 
 
 þ o
 o o
  Large accelerated filer o
Accelerated filer þ
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company o o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONItem 1. Financial Statements.Item 2. Trustees Discussion and Analysis of Financial Condition and Results of Operations.Item 3. Quantitative and Qualitative Disclosures About Market Risk.Item 4. Controls and Procedures.PART II  OTHER INFORMATIONItem 1. Legal Proceedings.Item 1A. Risk Factors.Items 2 through 5.Item 6. Exhibits.SIGNATURESINDEX TO EXHIBITSEX-15.1EX-31.1EX-32.1    Table of Contents  
 PART I  FINANCIAL INFORMATION
 
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/s/ Ernst & Young LLP 
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WILLIAMS COAL SEAM GAS ROYALTY TRUST
 CONDENSED
STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS (UNAUDITED)
 September 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)ASSETSCurrent Assets  cash and cash equivalents
    
    $
    52,542
    
    
    $
    45,419Royalty interests in oil and gas properties
(less accumulated amortization
of $133,725,319 at
September 30, 2009 and
$132,988,670 at December 31,
2008) (Note 2)
    
    
    4,841,345
    
    
    
    5,577,994TOTAL ASSETS
    
    $
    4,893,887
    
    
    $
    5,623,413LIABILITIES AND TRUST CORPUSCurrent Liabilities:Accounts payable
    
    $
    191,436
    
    
    $
    31,193Trust corpus  9,700,000 units of
beneficial interest authorized
and outstanding (Note 2)
    
    
    4,702,451
    
    
    
    5,592,220TOTAL LIABILITIES
AND TRUST CORPUS
    
    $
    4,893,887
    
    
    $
    5,623,413
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WILLIAMS COAL SEAM GAS ROYALTY TRUST
 CONDENSED STATEMENTS OF DISTRIBUTABLE INCOME (EXPENSES IN
EXCESS OF INCOME) (UNAUDITED)
 THREE MONTHS
    
    
    THREE MONTHSENDED
    
    
    ENDEDSeptember 30, 2009
    
    
    September 30, 2008Royalty income (Notes 2 and 7)
    
    $
    77,767
    
    
    $
    3,629,317Interest income
    
    
    42
    
    
    
    6,058Total
    
    
    77,809
    
    
    
    3,635,375General and administrative
expenses (Note 4)
    
    
    (182,005
    )
    
    
    (155,777
    )Distributable income (expenses in excess of
income)
    
    $
    (104,196
    )
    
    $
    3,479,598Distributable income (expenses in excess of
income) per unit
(9,700,000 units) (Note 2)
    
    $
    (.01
    )
    
    $
    .36
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WILLIAMS COAL SEAM GAS ROYALTY TRUST
 CONDENSED STATEMENTS OF DISTRIBUTABLE INCOME (UNAUDITED)
 NINE MONTHS
    
    
    NINE MONTHSENDED
    
    
    ENDEDSeptember 30, 2009
    
    
    September 30, 2008Royalty income (Notes 2 and 7)
    
    $
    2,403,029
    
    
    $
    7,775,852Interest income
    
    
    841
    
    
    
    13,952Total
    
    
    2,403,870
    
    
    
    7,789,804General and administrative
expenses (Note 4)
    
    
    (820,886
    )
    
    
    (704,677
    )Distributable income
    
    $
    1,582,984
    
    
    $
    7,085,127Distributable income per unit
(9,700,000 units) (Note 2)
    
    $
    0.16
    
    
    $
    0.73
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WILLIAMS COAL SEAM GAS ROYALTY TRUST
 CONDENSED STATEMENTS OF CHANGES IN TRUST CORPUS (UNAUDITED)
 NINE MONTHS
    
    
    NINE MONTHSENDED
    
    
    ENDEDSeptember 30, 2009
    
    
    September 30, 2008Trust corpus, beginning of period
    
    $
    5,592,220
    
    
    $
    6,877,977Amortization of royalty interests (Note 2)
    
    
    (736,649
    )
    
    
    (868,661
    )Distributable income
    
    
    1,582,984
    
    
    
    7,085,127Distributions to Unitholders (Note 5)
    
    
    (1,736,104
    )
    
    
    (6,951,298
    )Trust corpus, end of period
    
    $
    4,702,451
    
    
    $
    6,143,145Distributions per unit
(9,700,000 units) (Note 5)
    
    $
    0.18
    
    
    $
    0.72
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WILLIAMS COAL SEAM GAS ROYALTY TRUST
 NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
 1. TRUST ORGANIZATION AND PROVISIONS
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2. BASIS OF ACCOUNTING
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
    
    Revenues are recognized in the period in which amounts are received by the
Trust. Routine general and administrative expenses are recognized on an accrual basis.
No amounts have been accrued for services which may be required in the future related
to the possible termination of the Trust.
    
    Amortization of the Royalty Interests is calculated on a unit-of-production
basis and charged directly to trust corpus.
    
    Distributions to Unitholders are recorded when declared by the Trustee (See
Note 5).
    
    Loss contingencies are recognized in the period in which amounts are paid by
the Trust.
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Modernization of Oil and Gas Reporting Extractive Industries  Oil and Gas (Topic 932)
 3. FEDERAL INCOME TAXES
   th
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4. RELATED PARTY TRANSACTIONS
   5. DISTRIBUTIONS TO UNITHOLDERS
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6. SUBSEQUENT EVENTS
  QuarterlyRecord
    
    Payment
    
    DistributionDate
    
    Date
    
    per UnitNovember
16, 2009
    
    November 27, 2009
    
    $.022074
  7. CONTINGENCIES
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Three Months and Nine Months Ended September 30, 2009 Compared to Three Months and Nine Months
Ended September 30, 2008
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Three Months
    
    Three MonthsEnded
    
    EndedJune 30, 2009
    
    June 30, 2008Production (MMBtu) (1)WI Properties
    
    
    13,813
    (2)
    
    
    1,248,685
    (3)Farmout Properties
    
    
    238,672
    
    
    
    269,960Infill Properties (5)(6)
    
    
    8,676
    (5)
    
    
    0
    (6)Blanco Hub Spot Price ($/MMBtu) (4)
    
    $
    2.59
    
    
    $
    9.19Net Wellhead Price WI Properties
($/MMBtu) (4)
    
    $
    .76
    
    
    $
    4.08
 
 (1)
    
    Million British Thermal Units.(2)
    
    The WI Properties realized a net deficit from the Net Profits Interest for the three month
period ended September 30, 2009; therefore, no production quantities related to that period
are presented. The production quantity above is comprised entirely of favorable retroactive
adjustments of 13,813 MMBtu.(3)
    
    Includes unfavorable retroactive adjustments of 48,788 MMBtu.(4)
    
    Simple average of estimates for the months included in the period presented.(5)
    
    There was no distribution from the Infill Properties for the
three month period ended September 30, 2009 as described in Note 1 to the
financial statements of the Trust. The production quantity above reflects
favorable retroactive adjustments of 8,676 MMBtu.(6)
    
    No distribution was made for Infill Properties.  18




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Termination and Liquidation of the Trust
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Pending SEC Rule and FASB Standards
 Modernization of Oil and Gas Reporting Extractive Industries  Oil and Gas (Topic 932)
 Forward-Looking Statements
  
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Funds held by the Trustee are not insured by the Federal
Deposit Insurance Corporation, and future royalty income may be subject to risks relating to the
creditworthiness of third parties.
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PART II  OTHER INFORMATION
 
   
   Current commodity prices may result in minimal or no future distributions, and distributions,
including any distributions upon a termination and liquidation of the Trust may not equal or exceed
the purchase price paid by a Unitholder for Units.
  There is substantial doubt about our ability to continue as a going concern.
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Funds held by the Trustee are not insured by the Federal Deposit Insurance Corporation, and future
royalty income may be subject to risks relating to the creditworthiness of third parties.
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EXHIBITNUMBER
    
    EXHIBIT4.1 
    
    Trust Agreement of Williams Coal Seam
Gas Royalty Trust effective as of
December 1, 1992, by and among
Williams Production Company, The
Williams Companies, Inc. and Chemical
Bank Delaware and Bank of America,
N.A. (as successor to NationsBank of
Texas, N.A.), as trustees (filed as
Exhibit 4.1 to the Registrants Form
10-K for the year ended December 31,
1992 and incorporated herein by
reference).4.2 
    
    First Amendment to the Trust
Agreement of Williams Coal Seam Gas
Royalty Trust effective as of
December 15, 1992, by and among
Williams Production Company, The
Williams Companies, Inc., Chemical
Bank Delaware and Bank of America,
N.A. (as successor to NationsBank of
Texas, N.A.) (filed as Exhibit 4.2 to
the Registrants Form 10-K for the
year ended December 31, 1992 and
incorporated herein by reference).4.3 
    
    Second Amendment to the Trust
Agreement of Williams Coal Seam Gas
Royalty Trust effective as of January
12, 1993, by and among Williams
Production Company, The Williams
Companies, Inc., Chemical Bank
Delaware and Bank of America, N.A.
(as successor to NationsBank of
Texas, N.A.) (filed as Exhibit 4.3 to
the Registrants Form 10-K for the
year ended December 31, 1992 and
incorporated herein by reference).4.4 
    
    Net Profits Conveyance effective as
of October 1, 1992, by and among
Williams Production Company, The
Williams Companies, Inc., and Bank of
America, N.A. (as successor to
NationsBank of Texas, N.A.), and
Chemical Bank Delaware (filed as
Exhibit 4.4 to the Registrants Form
10-K for the year ended December 31,
1992 and incorporated herein by
reference).15.1 
    
    Letter regarding unaudited interim financial
information dated November 6, 2009, from the
independent Registered Public
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EXHIBITNUMBER
    
    EXHIBITAccounting Firm which
acknowledges awareness of the use in registration
statement of a report on unaudited interim financial
information.31.1 
    
    Certification by Ron E. Hooper, Senior Vice President
and Administrator of Bank of America, Trustee of
Williams Coal Seam Gas Royalty Trust, dated November
6, 2009, and submitted pursuant to Rule
13a-14(a)/15d-14(a) and pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.32.1 
    
    Certificate by Bank of America, Trustee of Williams
Coal Seam Gas Royalty Trust, dated November 6,
2009, and submitted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350).
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SIGNATURES
  WILLIAMS COAL SEAM GAS ROYALTY TRUSTBy:
    BANK OF AMERICA, N.A., TrusteeBy:
    /s/ RON E. HOOPERRon E. HooperSenior Vice President and Administrator   28




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INDEX TO EXHIBITS
 EXHIBIT NUMBER
    
    EXHIBIT4.1 
    
    Trust Agreement of Williams Coal Seam Gas Royalty Trust
effective as of December 1, 1992, by and among Williams
Production Company, The Williams Companies, Inc. and
Chemical Bank Delaware and Bank of America, N.A. (as
successor to NationsBank of Texas, N.A.), as trustees
(filed as Exhibit 4.1 to the Registrants Form 10-K for the
year ended December 31, 1992 and incorporated herein by
reference).4.2 
    
    First Amendment to the Trust Agreement of Williams Coal
Seam Gas Royalty Trust effective as of December 15, 1992,
by and among Williams Production Company, The Williams
Companies, Inc., Chemical Bank Delaware and Bank of
America, N.A. (as successor to NationsBank of Texas, N.A.)
(filed as Exhibit 4.2 to the Registrants Form 10-K for the
year ended December 31, 1992 and incorporated herein by
reference).4.3 
    
    Second Amendment to the Trust Agreement of Williams Coal
Seam Gas Royalty Trust effective as of January 12, 1993, by
and among Williams Production Company, The Williams
Companies, Inc., Chemical Bank Delaware and Bank of
America, N.A. (as successor to NationsBank of Texas, N.A.)
(filed as Exhibit 4.3 to the Registrants Form 10-K for the
year ended December 31, 1992 and incorporated herein by
reference).4.4 
    
    Net Profits Conveyance effective as of October 1, 1992, by
and among Williams Production Company, The Williams
Companies, Inc., and Bank of America, N.A. (as successor to
NationsBank of Texas, N.A.), and Chemical Bank Delaware
(filed as Exhibit 4.4 to the Registrants Form 10-K for the
year ended December 31, 1992 and incorporated herein by
reference).15.1 
    
    Letter regarding unaudited interim financial information
dated November 6, 2009, from the independent Registered
Public Accounting Firm which acknowledges awareness of the
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EXHIBIT NUMBER
    
    EXHIBITuse in registration statement of a report on unaudited
interim financial information.31.1 
    
    Certification by Ron E. Hooper, Senior Vice President and
Administrator of Bank of America, Trustee of Williams Coal
Seam Gas Royalty Trust, dated November 6, 2009, and
submitted pursuant to Rule 13a-14(a)/15d-14(a) and pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.32.1 
    
    Certificate by Bank of America, Trustee of Williams Coal
Seam Gas Royalty Trust, dated November 6, 2009, and
submitted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 (18 U.S.C. Section 1350).
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