Exhibit 99.1
 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      
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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY
 CONSOLIDATED STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS
As of December 31, 2010 and 2009
(Audited)
 December 31,
    
    
    December 31,2010
    
    
    2009AssetsCurrent assets:Cash and cash equivalents
    
    $
    1,299,734
    
    
    $
    1,531,808Oil, gas and other mineral properties
    
    
    2
    
    
    
    2Federal income tax refundable
    
    
    12,734
    
    
    
    15,934Total assets
    
    $
    1,312,470
    
    
    $
    1,547,744Liabilities and Trust CorpusCurrent liabilities:Accounts payable
    
    $
    
    
    
    $
    Federal income taxes payable
    
    
    
    
    
    
    Income distributable to unitholders
    
    
    507,437
    
    
    
    609,840Total current liabilities
    
    $
    507,437
    
    
    $
    609,840Trust corpus  authorized 1,386,525 units of
beneficial interest, issued
1,386,375 at nominal value
    
    
    805,033
    
    
    
    937,904$
    1,312,470
    
    
    $
    1,547,744
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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY
 CONSOLIDATED STATEMENTS OF DISTRIBUTABLE INCOME
For the Three Years Ended December 31, 2010
(Audited)
 2010
    
    
    2009
    
    
    2008Income:Oil and gas royalties
    
    $
    2,198,781
    
    
    $
    3,133,279
    
    
    $
    4,574,710Interest income
    
    
    
    
    
    
    769
    
    
    
    27,039Total income
    
    $
    2,198,781
    
    
    $
    3,134,048
    
    
    $
    4,601,749Expenses:General and administrative expenses
    
    $
    209,540
    
    
    $
    289,261
    
    
    $
    325,871Distributable income before Federal
income taxes
    
    
    1,989,241
    
    
    
    2,844,787
    
    
    
    4,275,878Federal income taxes of subsidiary
    
    
    3,200
    
    
    
    13,000
    
    
    
    45,670Distributable income
    
    $
    1,986,041
    
    
    $
    2,831,787
    
    
    $
    4,230,208Distributable income per unit
    
    $
    1.43
    
    
    $
    2.04
    
    
    $
    3.05Distributions per unit
    
    $
    1.53
    
    
    $
    2.26
    
    
    $
    2.97Units outstanding
    
    
    1,386,375
    
    
    
    1,386,375
    
    
    
    1,386,375
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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY
 CONSOLIDATED STATEMENTS OF CHANGES IN TRUST CORPUS
For the Three Years Ended December 31, 2010
(Audited)
 2010
    
    
    2009
    
    
    2008Trust corpus, beginning of period
    
    $
    937,904
    
    
    $
    1,233,375
    
    
    $
    1,118,498Distributable income
    
    
    1,986,041
    
    
    
    2,831,787
    
    
    
    4,230,208Distributions to unitholders
    
    
    (2,118,912
    )
    
    
    (3,127,258
    )
    
    
    (4,115,331
    )Trust corpus, end of period
    
    $
    805,033
    
    
    $
    937,904
    
    
    $
    1,233,375
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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2010
 (1)
    
    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND GENERAL
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Royalty Payors
    
    2010
    
    2009
    
    2008Devon Energy Production Company LP
    
    
    44
    %
    
    
    78
    %
    
    
    77
    %JX Nippon Oil & Gas Exploration Corp. (NOEX)
    
    
    34
    %
    
    
    15
    %
    
    
    8
    %Apache Corporation
    
    
    10
    %
    
    
    
    
    
    
    W&T Offshore Inc.
    
    
    7
    %
    
    
    7
    %
    
    
    7
    %Breton Engineering LLC
    
    
    3
    %
    
    
    
    
    
    
    Barron Petroleum Company
    
    
    2
    %
    
    
    
    
    
    
    3
    %ENI Petroleum USA LLC
    
    
    
    *
    
    
    
    *

    
    
    1
    %McMoran Oil & Gas
    
    
    
    
    
    
    
    
    
    
    4
    %Mariner Energy Resources, Inc.
    
    
    
    
    
    
    
    *

    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
 
 *
    
    Indicates less than 1% (2)
    
    BASIS OF ACCOUNTING
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
    
    Royalty income is recognized when received by Tidelands.
    
    Tidelands expenses (which include accounting, legal, and other professional
fees, trustees fees and out-of-pocket expenses) are recorded on an accrual basis.
Reserves for liabilities that are contingent or uncertain in amount may also be
established if considered necessary.
    
    Distributions to unitholders are recognized when declared by the Trustee of the
Trust.
  
    
    Royalty income is recognized in the month received rather than in the month of
production.
    
    Reserves may be established for contingencies that would not be recorded under
GAAP.
   (3)
    
    TEXAS FRANCHISE TAX
  e.g. e.g.
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(4)
    
    SUBSEQUENT EVENTS
  (5)
    
    SUPPLEMENTAL INFORMATION RELATING TO OIL AND NATURAL GAS RESERVES (UNAUDITED)
  For Year Ended December 31,2010
    
    2009
    
    2008Net production quantities:Oil (bbls)
    
    
    8,650
    
    
    
    6,662
    
    
    
    4,603Natural gas (mcf)
    
    
    268,723
    
    
    
    513,880
    
    
    
    428,728
 (6)
    
    SUMMARY OF QUARTERLY FINANCIAL DATA (UNAUDITED)
  Oil and
    
    
    
    
    
    
    DistributableNatural Gas
    
    
    Distributable
    
    
    Income PerRoyalties
    
    
    Income
    
    
    UnitQuarter ended:March 31, 2009
    
    $
    1,172,076
    
    
    $
    1,088,388
    
    
    $
    0.79June 30, 2009
    
    
    634,411
    
    
    
    548,452
    
    
    
    0.39September 30, 2009
    
    
    793,293
    
    
    
    722,686
    
    
    
    0.52December 31, 2009
    
    
    533,499
    
    
    
    472,261
    
    
    
    0.34$
    3,133,279
    
    
    $
    2,831,787
    
    
    $
    2.04Quarter ended:March 31, 2010
    
    $
    682,597
    
    
    $
    636,495
    
    
    $
    0.46June 30, 2010
    
    
    525,991
    
    
    
    456,320
    
    
    
    0.33September 30, 2010
    
    
    413,669
    
    
    
    348,652
    
    
    
    0.25December 31, 2010
    
    
    576,524
    
    
    
    544,574
    
    
    
    0.39$
    2,198,781
    
    
    $
    1,986,041
    
    
    $
    1.43
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