##### Table of Contents



SECURITIES AND EXCHANGE
    COMMISSION
 Washington, D.C.
    20549
      FORM 10-K
      (Mark One)
 þ
    ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
    (FEE REQUIRED)  For the Fiscal Year ended December 31, 2006
  OR
  o
    TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
    (NO FEE REQUIRED)  Commission File Number: 1-8518
 LL&E ROYALTY
    TRUST
 (Exact name of registrant as
    specified in its charter)
  Texas(State or other
    jurisdiction
    of incorporation or organization)

76-6007940(I.R.S. Employer
    Identification No.)The Bank of New York Trust
    Company, N.A., TrusteeGlobal Corporate
    Trust919 Congress Avenue
    Austin, Texas

78701(Address of principal executive
    offices)

(Zip
    Code)   Registrants telephone number, including area code:
    1-800-852-1422
 Securities registered pursuant to Section 12(b) of the
    Act:
  Name of Each ExchangeTitle of Each Class

On Which RegisteredUnits of Beneficial Interest


New York Stock Exchange   Securities registered pursuant to Section 12(g) of the
    Act: None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  o þ o
  Rule 12b-2 o þ
  The Wall Street Journal
    Documents Incorporated by Reference:  None




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##### Table of Contents



TABLE OF
    CONTENTS
  PagenumberPART IITEM  1  
    Business


1Introduction


1Terms and Operation
    of the Trust


2Creation and
    Operation of the Trust


2Terms of the
    Conveyances


2The
    Partnership


4Receipts and
    Payments


4Liabilities and
    Contingency Reserves


4Duration and
    Termination of the Trust


5Other Matters Relating to the
    Termination of the Trust


8The
    Royalties


9Overriding
    Royalties


9Fee Lands
    Royalties


10Analysis of the
    Working Interest Owners Calculation of the
    Royalties


11The Units


12Distributions and
    Income Computations


12Transfer of
    Units


12Periodic
    Reports


12Possible
    Requirement That Units Be Divested


13Liability of Unit
    Holders


14Voting by Unit
    Holders


14Certain State Law
    Considerations


14The
    Properties


15General


15Description of
    Productive Properties


15Description of the
    Fee Lands


16Oil and Gas Sales
    from the Productive Properties


17Oil Sales


17Gas and Liquids
    Sales


17Exploration and
    Development Activities


18Productive
    Properties


18Fee Lands


19Estimates of
    Petroleum Engineers


19September 30,
    2006 Estimates


19Certain Factors
    Affecting Estimates


19Industry Conditions
    and Regulation


29Industry
    Conditions


29Regulation


29Tax Considerations
    to Owners of Units


29Federal Income Tax
    Considerations


29IDC Recapture
    Income to the Company on Distribution


37Backup
    Withholding


37Information Return
    Filing Requirements


38




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PagenumberState Tax
    Considerations


38Severance
    Taxes


40Ad Valorem
    Taxes


40Available
    Information


41ITEM  1A 
    Risk Factors


41ITEM  1B 
    Unresolved Staff Comments


44ITEM  2  
    Properties


44ITEM  3  
    Legal Proceedings


44ITEM  4  
    Submission of Matters to a Vote of Unit Holders


44PART IIITEM  5  
    Market for Registrants Common Equity, Related Unit Holder
    Matters and Issuer Purchases of Equity Securities


44ITEM  6  
    Selected Financial Data


45ITEM  7  
    Managements Discussion and Analysis of Financial Condition
    and Results of Operation


45ITEM  7A 
    Quantitative and Qualitative Disclosures about Market
    Risk


51ITEM  8  
    Financial Statements and Supplementary Data


52ITEM  9  
    Changes in and Disagreements with Accountants on Accounting and
    Financial Disclosure


64ITEM  9A 
    Controls and Procedures


64ITEM  9B 
    Other Information


64PART IIIITEM  10 
    Directors Executive Officers and Corporate Governance


65ITEM  11 
    Executive Compensation


65ITEM  12 
    Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters


65ITEM  13 
    Certain Relationships and Related Transactions, and Director
    Independence


65ITEM  14 
    Principal Accounting Fees and Services


65PART IVITEM  15 
    Exhibits, Financial Statement Schedules


66SIGNATURE


67Certification Pursuant to Section 302Certification Pursuant to Section 906    Form 10-K, Form 10-K,




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PART I  Item 1.
    Business INTRODUCTION  1-800-852-1422.
       1




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Form 10-K
 TERMS AND
    OPERATION OF THE TRUST Creation
    and Operation of the Trust         Terms of
    the Conveyances  Form 10-K.
   2




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Form 10-K.
 3




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Form 10-K,
     The
    Partnership   Receipts
    and Payments   Liabilities
    and Contingency Reserves   4




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Duration
    and Termination of the Trust   5




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Form 10-K
 6




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##### Table of Contents



South
    Pass 89
    Offshore
    Properties:
  East
    Cameron 336
    East
    Cameron 195
    South
    Marsh Island 76
    Eugene
    Island 261
    Vermillion
    331
    Jay
    Field
   7




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Other
    Matters Relating to the Termination of the Trust
         8




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THE
    ROYALTIES  Form 10-K.
 Overriding
    Royalties  Property-by-Property Form 10-K. Form 10-K,
   9




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Fee Lands
    Royalties   10




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Analysis
    of the Working Interest Owners Calculation of the
    Royalties    Quarter
    ended December 31, 2006
  South


OffshoreJay Field


Pass 89


Louisiana


TotalRevenues:Liquids

$
7,503,032


$
64,609


$
105,138


$
7,672,779Natural gas


(903
)






378,714



377,811$
7,502,129


$
64,609


$
483,852


$
8,050,590Amounts withheld in escrow






(64,609
)


(483,852
)


(548,461
)Production costs and expenses(1)


(3,938,483
)


(174,883
)


(2,426,733
)


(6,540,099
)Capital expenditures


(402,299
)


(
)


(1,738
)


(404,037
)Net Proceeds

$
3,161,347


$
(174,883
)

$
(2,428,471
)

$
557,993Overriding Royalties paid to the
    Trust(2)

$
1,580,674


$



$



$
1,580,674Fee Lands Royalties


69,556Royalties paid to the Trust

$
1,650,230   Year
    ended December 31, 2006
  South


OffshoreJay Field


Pass 89


Louisiana


TotalRevenues:Liquids

$
27,241,731


$
64,609


$
511,342


$
27,817,682Natural gas


37,313







2,344,494



2,381,807$
27,279,044


$
64,609


$
2,855,836


$
30,199,489Amounts withheld in escrow






(64,609
)


(2,031,950
)


(2,096,559
)Production costs and expenses(1)


(15,735,462
)


(516,976
)


(2,824,095
)


(19,076,533
)Capital expenditures


(5,024,167
)


(
)


(18,296
)


(5,042,463
)Net Proceeds

$
6,519,415


$
(516,976
)

$
(2,018,505
)

$
3,983,934Overriding Royalties paid to the
    Trust(2)

$
2,198,850


$



$
528,064


$
2,726,914Fee Lands Royalties


341,724Royalties paid to the Trust

$
3,068,638     (1)
    
    Interest earned on funds escrowed for future dismantlement costs
    are reported as a reduction of production costs and expenses.
    Interest earned for the quarter and year ended December 31,
    2006 was approximately $119,791 and $590,632, respectively.
    Pursuant to the terms of the Trust Conveyances, interest earned
    on the escrowed funds for any month will be calculated at an
    interest rate equal to 80 percent of the median between the
    Prime Rate at the end of such month and the Prime Rate at the
    end of the preceding month. 11




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Processing fees earned are also shown as a reduction of
    production costs and expenses. For the year ended
    December 31, 2006, South Pass 89 property processing fees
    earned totaled $67,174 and interest on escrow totaled $127,896,
    while the operating expenses totaled $712,047, netting a
    production cost of $516,976.(2)
    
    The 2006 royalty income for the Jay Field and South Pass 89
    properties have been reduced by $2,121,713 and $32,905
    respectively, as a result of excess production costs arising in
    2005. The South Pass 89 and Offshore Louisiana properties have
    excess production costs of $549,881 and $2,605,242,
    respectively, as of December 31, 2006. THE
    UNITS Distributions
    and Income Computations     Transfer
    of Units   Periodic
    Reports   12




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Possible
    Requirement That Units Be Divested      30-day over-the-counter 30-day
     13




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Liability
    of Unit Holders   Voting by
    Unit Holders     Certain
    State Law Considerations   14




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THE
    PROPERTIES General  Form 10-K
   Description
    of Productive Properties    ProductiveProperty and Year









Productive Wells(1)in Which



Acres


Oil


AcresProduction Commenced

Location

Gross


Net


Gross


Net


Gross


NetJay Field (1970)(2)

Onshore


184,472
(3)


62,150
(3)


32



10.78



1



.34Alabama
    and FloridaSouth Pass 89 (1982)

Offshore


5,000



1,250



2



0.50



2



.50LouisianaOffshore Louisiana (1968)(4)

Offshore


15,000



3,178



17



2.88



29



6.09Louisiana


204,472



66,578



51



14.16



32



6.93     (1)
    
    Represent producing wells and wells capable of production. Net
    wells reflect the Working Interest Owners working
    interest. Gross and net wells exclude injection wells.(2)
    
    Includes interests in 23 leases which are a part of the Jay
    Field Unit created by a unit agreement among ExxonMobil (as
    operator) and others. The Jay Field is made up of 177 different
    tracts of land. Portions of certain leases are located outside
    of the Jay Field Unit. The Overriding Royalties from the Jay
    Field burden only the portions of such leases included within
    the Jay Field Unit and owned by the Working Interest Owner as of 15




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June 28, 1983. In addition, certain minor interests of the
    Company in the Jay Field are not included in the Jay Field
    Productive Property. The information in the table above relates
    only to the portion of the Jay Field included in the Jay Field
    Productive Property. All right, title and interest of the
    Company in the Jay Field Productive Property was assigned to the
    following entities in the following undivided percentages on
    December 21, 2006, effective as of September 1, 2006;  Percentage ofthe WorkingInterest  OwnedDesignation

by the OperatorsBlack Diamond Resources


3.9080
%QAB Carried WI, LP


1.6248
%QAC Carried WI, LP


2.8844
%Quantum Resources A1, LP


91.5828
%   Quantum Resources Management, LLC (Quantum) will
    manage the Jay Field working interest on behalf of the above
    listed assignees after a short post-closing transition period
    during which the Company will continue to manage the Jay Field
    working interest. Upon assumption of management responsibilities
    by Quantum, Quantum will assume the accounting and reporting
    obligations to the Trust attributable to the Jay Field
    Productive Property. Quantum has notified the Company that when
    it takes over the operations of the Jay Field in April 2007, it
    plans to undertake a different operating and development
    strategy for Jay Field. Quantums basic planned strategy
    involves attempting to reduce costs and increase production by
    terminating the purchase and injection of nitrogen gas,
    conversion of the nitrogen injection lines to water injection,
    installation of gas lift on production wells, and the
    reactivation of the available water supply wells with new
    electrical submersible pumps to increase the current water
    injection levels in order to compensate for the cessation of
    nitrogen injection. As of the date of this report, the projected
    results of these operating and development strategies on the
    future net revenues of the Trust have not been determined. The
    Company will continue to account for and report on the remainder
    of the Properties other than the Jay Field Productive Properties.(3)
    
    Gross acres reflect aggregate porosity
    acre-feet in
    producing formations in the Jay Field, and net acres reflect the
    Working Interest Owners ownership interest in the
    producing formations as determined volumetrically for purposes
    of the unit agreement relating to the Jay Field.(4)
    
    Includes four federal leases or federal units (as applicable)
    with designations, initial production dates and percentage
    ownership of the Working Interest Owner as follows:  Percentage ofthe WorkingDesignation and Initial

Interest OwnedProduction Date

by the OperatorsEast Cameron 195 Unit (1971)


33.33
%East Cameron 336, South Addition
    (1983)


20
%Eugene Island 261 (1979)


20
%South Marsh Island 76, South
    Addition (1968)


25
%Vermilion 331, South Addition
    (1977)


12.5
%   During the Fourth Quarter of 2001, the Working Interest Owner
    assigned its ownership in any future wells or existing well work
    activity at East Cameron 336 to other owners, but retained its
    share of the plugging and abandonment liability. Description
    of the Fee Lands   16




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OIL AND
    GAS SALES FROM THE PRODUCTIVE PROPERTIES Oil
    Sales   Gas and
    Liquids Sales     17




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EXPLORATION
    AND DEVELOPMENT ACTIVITIES Productive
    Properties    Net WellsOil


Gas


Dry2004Exploratory










Development










2005Exploratory










Development


1.000







2006Exploratory










Development










     Jay
    Field
   18




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South
    Pass 89
    Offshore
    Louisiana
   Fee
    Lands   ESTIMATES
    OF PETROLEUM ENGINEERS September 30,
    2006 Estimates         Certain
    Factors Affecting Estimates     19




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20




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21




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th st
 78701-3102
  Re:
    Estimates of Proved Reserves and Future 
    Net Revenues for the LL&E Royalty Trust
    As of September 30, 2006        Net Proved Imputed Reserves and Revenues (1) (2) (3)Crude Oil,








Net RevenuesCondensate, and


Natural


Future Net


Discounted at 10%Natural Gas Liquids


Gas,


Revenues,


Per Year,Reserve Category

MBbls.


MMcf


M$


M$Proved Developed


1,553.8



1,910.3



99,175.4



49,968.6Proved Undeveloped


0.0



0.0



0.0



0.0Total Proved


1,553.8



1,910.3



99,175.4



49,968.6     (1)
    
    The Trust will terminate in the event the total amount of net
    revenues received by the Trust falls below $5,000,000 for two
    successive years (the Termination Threshold).
    According to recent press announcements issued by the Trust, net
    revenues to the Trust during 2006 were below the
    Termination Threshold. There can be no assurance that the
    net revenues to the Trust during 2007 will be above the
    Termination Threshold. Accordingly, it is possible for the
    Trust to terminate even though some of the Trust properties have
    remaining productive lives. See Duration and Termination
    of the Trust in this document on
    Form 10-K.(2)
    
    Total Proved Reserves and Revenues may not equal the sum of the
    separate categories due to the manner in which the trust model
    handles the recovery of excess production costs. Timing of the
    recoupment of these costs out of total proved production may
    vary slightly from the timing associated with the separate
    proved reserve 22




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The Bank of
    New York, Trustee
    March 23,
    2007 LL&E
    Royalty Trust
    Page 2   categories. Future excess production costs will be recouped out
    of total proved production regardless of reserve category.(3)
    
    Proved Undeveloped Reserves associated with the Eugene Island
    Block 261 well
    A-6ST were
    uneconomic under current economic conditions.  Regulation S-X, Rule 4-10(a)
        Estimated Future Net Revenues to the Trust
    (1)(2)(3)For Production

From Proved


From Proved


From TotalDuring the 12

Developed


Undeveloped


ProvedMonths Ended

Reserves,


Reserves,


Reserves,September 30

M$


M$


M$2007


7,105.2



0.0



7,105.22008


4,965.5



0.0



4,965.52009


5,402.5



0.0



5,402.52010


5,690.2



0.0



5,690.22011


7,689.1



0.0



7,689.12012


8,049.5



0.0



8,049.5Remainder


60,273.4



0.0



60,273.4Total


99,175.4



0.0



99,175.4     (1)
    
    The Trust will terminate in the
    event the total amount of net revenues received by the Trust
    falls below $5,000,000 for two successive years (the
    Termination Threshold). According to recent press
    announcements issued by the Trust, net revenues to the Trust
    during 2006 were below the Termination Threshold.
    There can be no assurance that the net revenues to the Trust
    during 2007 will be above the Termination Threshold,
    thus it is possible for the Trust to terminate even though some
    of the Trust properties have remaining productive lives. See
    Duration and Termination of the Trust in this
    document on Form
    10-K.(2)
    
    Total Proved Reserves and Revenues
    may not equal the sum of the separate categories due to the
    manner in which the trust model handles the recovery of excess
    production costs. Timing of the recoupment of these costs out of
    total proved 23




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The Bank of
    New York, Trustee
    March 23,
    2007 LL&E
    Royalty Trust
    Page 3   production may vary slightly from
    the timing associated with the separate proved reserve
    categories. Future excess production costs will be recouped out
    of total proved production regardless of reserve category.(3)
    
    Proved Undeveloped Reserves
    associated with the Eugene Island Block 261 well
    A-6ST were
    uneconomic under current economic conditions.  12-month
    Last Year ofEstimated Future


EstimatedNet Revenues to


EconomicThe Trust,


Life ofProperty

M$(1)(2)


Reserves(3)Jay Field


98,751.4



2031South Pass 89


0.0



2010Offshore Louisiana


0.0



2012Fee Lands


424.0



2012Total


99,175.4     (1)
    
    The Trust will terminate in the
    event the total amount of net revenues received by the Trust
    falls below $5,000,000 for two successive years (the
    Termination Threshold). According to recent press
    announcements issued by the Trust, net revenues to the Trust
    during 2006 were below the Termination Threshold.
    There can be no assurance that the net revenues to the Trust
    during 2007 will be above the Termination Threshold,
    thus it is possible for the Trust to terminate even though some
    of the Trust properties have remaining productive lives. See
    Duration and Termination of the Trust in this
    document on
    Form 10-K.(2)
    
    Total Proved Reserves and Revenues
    may not equal the sum of the separate categories due to the
    manner in which the trust model handles the recovery of excess
    production costs. Timing of the recoupment of these costs out of
    total proved production may vary slightly from the timing
    associated with the separate proved reserve categories. Future
    excess production costs will be recouped out of total proved
    production regardless of reserve category. Based on information
    provided by the Company, it is estimated that the future
    dismantlement costs in excess of the amounts currently held in
    escrow, will exceed the estimated future net revenues for the
    South Pass 89 and Offshore Louisiana properties and will result
    in zero future net revenues to the Trust.(3)
    
    Projected economic life without
    consideration of estimated future dismantlement costs.   24




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The Bank of
    New York, Trustee
    March 23,
    2007 LL&E
    Royalty Trust
    Page 4     Percentage of Net ProceedsWorking Interest Property

Attributable to Overriding
    RoyaltiesJay Field


50South Pass 89


50Offshore Louisiana


90   property-by-property
         25




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The Bank of
    New York, Trustee
    March 23,
    2007 LL&E
    Royalty Trust
    Page 5          Imputed proved reserves
    to the Trust (expressed
    in Bbls or Mcf)

=

Estimated future
    net revenues to the
    TrustEstimated
    future
    gross revenues
    to the
    Company(1)

×

Estimated net proved
    reserves of the Company
    (Bbls or Mcf)     (1)
    
    Prior to subtraction of all costs (including Jay Field fuel and
    severance taxes) and the costs attributable to the Trust.      
    The Company and the operator of Jay Field, sold its
    respective working interests in the field to Quantum Resource
    Management (Quantum) in December 2007. Based on discussions with
    Quantum, it expects to become operator in April 2007 and will
    undertake a different operating and development strategy for Jay
    Field than what has been considered in this report.
    Quantums basic planned strategy involves attempting to
    reduce costs and increase production by terminating the purchase
    and injection of nitrogen gas, conversion of the nitrogen
    injection lines to water injection, installation of gas lift on
    production wells, and the reactivation of the available water
    supply wells with new electrical submersible pumps to increase
    the current water injection levels in order to compensate for
    the cessation of nitrogen injection. Quantums strategy and
    potential results have not been considered in this report.
    The Vermillion Block 331
    A-25 well
    bore is no longer useable for two future planned behind-pipe
    recompletions. Consequently, additional costs will be incurred
    in order to drill two new sidetracks which will be required in
    order to produce the estimated reserves. 26




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The Bank of
    New York, Trustee
    March 23,
    2007 LL&E
    Royalty Trust
    Page 6              Miller and Lents, Ltd.
  By
    /s/  Gary
    W. Priddy   P.E.
  By
    /s/  Robert
    J. Oberst   P.E.
  By
    /s/  Carl
    D. Richard   P.E.
  RJO/sg
 27




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Appendix
  Proved
    Reserves Definitions
    In Accordance With
    Securities and Exchange Commission
    Regulation S-X
  Proved
    Oil and Gas Reserves
                    Proved
    Developed Oil and Gas Reserves
    Proved
    Undeveloped Oil and Gas Reserves
   28




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INDUSTRY
    CONDITIONS AND REGULATION Industry
    Conditions   Regulation     TAX
    CONSIDERATIONS TO OWNERS OF UNITS Federal
    Income Tax Considerations  Introduction
      Rulings
    and Tax Opinion Regarding Distribution
   29




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Tax
    Consequences of Owning Units
   30




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General Features of Grantor
    Trust Taxation.
  General Features of Partnership Taxation.
  i.e.
    Depletion Deductions.
 31




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Trust Administrative Expenses.
  Classification of Trust Income.
    Alternative Minimum Tax for Corporations.
  Alternative Minimum Tax for Noncorporate
    Taxpayers.
 32




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Abandonment Losses.
  Taxation of Nonresident Foreign Unit
    Holders.
  Form W-8ECI, Regulation Section 1.1441-4). Form W-8ECI
     33




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Sale of Units.
   34




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Reports.
  Audit of Partnership and
    Trust Returns.
    Accounting for Income and Deductions.
 35




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Related Tax Effects on Unit Holders.
    Other Possible Penalties.
 36




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IDC
    Recapture Income to the Company on Distribution     Backup
    Withholding      Nominee Reporting Requirements.
 37




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Information
    Return Filing Requirements     State Tax
    Considerations    Louisiana
     38




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Florida
            Alabama
   39




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paid-in-capital,
 Severance
    Taxes   Ad
    Valorem Taxes   40




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AVAILABLE
    INFORMATION  http:www.sec.gov
  Item 1A.
    Risk
    Factors  Form 10-K
  Natural gas and oil prices fluctuate due to a number of
    factors, and lower prices will reduce net proceeds available to
    the Trust and distributions to Trust Unit holders.
  month-to-month
  
    political conditions worldwide, in particular political
    disruption, war or other armed conflicts in oil producing
    regions;
    worldwide economic conditions;
    weather conditions;
    the supply and price of foreign natural gas and oil;
    the level of consumer demand;
    the price and availability of alternative fuels;
    the proximity to, and capacity of, transportation
    facilities; and
    the effect of worldwide energy conservation measures.      Damage from Hurricanes Katrina and Rita will have a
    material adverse effect on distributions from the Trust for the
    forseeable future.
    Pending Litigation Against the Working Interest Owner
    Could Adversely Impact Cash Distributions
   41




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Increased production and development costs for the
    Overriding Royalties will result in decreased Trust
    distributions.
      Trust reserve estimates depend on many assumptions that
    may prove to be inaccurate, which could cause both estimated
    reserves and estimated future revenues to be too high.
    
    historical production from the area compared with production
    rates from similar producing areas;
    the assumed effect of governmental regulation; and
    assumptions about future commodity prices, production and
    development costs, severance and excise taxes, and capital
    expenditures.      Operating risks can adversely affect Trust
    distributions.
    The operators of the properties are subject to extensive
    governmental regulation.
   42




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##### Table of Contents



Trust Unit holders and the Trustee have no control over
    the operation or development of the Royalty Properties and have
    little influence over operation or development.
    The owner of any Properties may abandon any property,
    terminating the related Overriding Royalties.
    The Trust can be terminated and may terminate in
    2007.
        Trust assets are depleting assets and, if the operators of
    the properties do not perform additional development projects,
    the assets may deplete faster than expected.
  Form 10-K.
 43




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##### Table of Contents



Unit holders have limited voting rights.
    Unit holders have limited ability to enforce the
    Trusts rights against the current or future owners of the
    Properties.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties    Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Unit Holders   PART II  Item 5.
    Market
    for the Registrants Common Equity, Related Unit Holder
    Matters and Issuer Purchases of Equity Securities      2006 Quarter Ended


2005 Quarter EndedMarch 31


June 30


Sept. 30


Dec. 31


March 31


June 30


Sept. 30


Dec. 31Units of Beneficial Interest:High sales price

$
3.40


$
3.79


$
3.40


$
3.41


$
8.29


$
7.75


$
6.52


$
4.75Low sales price


2.01



2.16



2.40



2.59



6.04



4.91



4.30



1.90Distributions per Unit

$
0.0000


$
0.0000


$
0.0202


$
0.0762


$
0.0789


$
0.1056


$
0.0835


$
0.0481    44




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##### Table of Contents



Item 6.
    Selected
    Financial Data  Form 10-K.
      Years Ended December 31,2006


2005


2004


2003


2002Revenues

$
3,068,638


$
7,354,827


$
10,857,596


$
8,496,041


$
2,616,241Cash earnings


2,094,226



6,586,512



10,178,621



7,869,942



2,055,121Cash distributions to Unit holders


1,831,080



6,002,945



10,177,500



7,882,218



2,076,828Cash distributions per Unit

$
0.0964


$
0.3161


$
0.5359


$
0.4150


$
0.1094Trust Corpus

$
2,616,186


$
2,393,340


$
1,827,273


$
1,909,252


$
2,046,528   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Critical
    Accounting Policies
      out-of-pocket
  unit-of-production
          Liquidity
    and Capital Resources
   45




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##### Table of Contents



Status of
    the Trust
              Form 10-K
 46




---



##### Table of Contents



South
    Pass 89
    Offshore
    Properties:
  East
    Cameron 336
    East
    Cameron 195
    South
    Marsh Island 76
    Eugene
    Island 261
    Vermillion
    331
   47




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##### Table of Contents



Jay
    Field
          Other
    Matters Relating to the Termination of the Trust
       48




---



##### Table of Contents



Results
    of Operations
  Years Ended December 31,2006


2005


2004Royalty Revenues

$
3,068,638


$
7,354,827


$
10,857,596Trust administrative expenses


(974,412
)


(768,315
)


(678,975
)Cash earnings

$
2,094,226


$
6,586,512


$
10,178,621Changes in undistributed cash


(263,146
)


(583,567
)


(1,121
)Cash distributions

$
1,831,080


$
6,002,945


$
10,177,500Cash distributions per unit

$
0.0964


$
0.3161


$
0.5359Units outstanding


18,991,304



18,991,304



18,991,304           Years Ended December 31,2006


2005


2004Net Proceeds:Revenues

$
30,199,489


$
35,882,309


$
33,137,067Amounts withheld in escrow


(2,096,559
)






Production costs and expenses


(19,076,533
)


(18,101,873
)


(14,849,569
)Capital expenditures


(5,042,463
)


(8,367,167
)


(7,903,159
)Net Proceeds

$
3,983,934


$
9,413,269


$
10,384,339Royalties paid to the Trust:Overriding Royalties

$
2,726,914


$
6,996,298


$
10,128,734Fee Lands Royalties


341,724



358,529



728,862Royalties paid to the Trust

$
3,068,638


$
7,354,827


$
10,857,596    49




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##### Table of Contents



50




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  month-to-month
  
    political conditions worldwide, in particular political
    disruption, war or other armed conflicts in oil producing
    regions;
    worldwide economic conditions;
    weather conditions;
    the supply and price of foreign natural gas;
    the level of consumer demand;
    the price and availability of alternative fuels;
    the proximity to, and capacity of, transportation
    facilities; and
    the effect of worldwide energy conservation measures.   51




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##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  LL&E
    ROYALTY TRUST
  STATEMENTS
    OF CASH EARNINGS AND DISTRIBUTIONS
    Years Ended December 31, 2006, 2005 and 2004
  2006


2005


2004Royalty revenues

$
3,068,638


$
7,354,827


$
10,857,596Trust administrative expenses


(974,412
)


(768,315
)


(678,975
)Cash earnings

$
2,094,226


$
6,586,512


$
10,178,621Changes in undistributed cash


(263,146
)


(583,567
)


(1,121
)Cash distributions

$
1,831,080


$
6,002,945


$
10,177,500Cash distributions per unit

$
0.0964


$
0.3161


$
0.5359Units outstanding


18,991,304



18,991,304



18,991,304   STATEMENTS
    OF ASSETS, LIABILITIES AND TRUST CORPUS
  December 31,
    2006 and 2005
  2006


2005ASSETSCash

$
848,086


$
584,940Net overriding royalty interests
    in productive oil and gas properties and 3% royalty interests in
    fee lands (notes 3, 4, 6 and 7)


76,282,000



76,282,000Less accumulated amortization
    (notes 4 and 6)


(74,513,900
)


(74,473,600
)Total assets

$
2,616,186


$
2,393,340LIABILITIES AND TRUST CORPUSTrust corpus (18,991,304 Units of
    Beneficial Interest authorized, issued and outstanding)

$
2,616,186


$
2,393,340Contingencies (notes 5, 7, 8
    and 9)Total liabilities and Trust corpus

$
2,616,186


$
2,393,340   STATEMENTS
    OF CHANGES IN TRUST CORPUS
  Years
    Ended December 31, 2006, 2005 and 2004
  2006


2005


2004Trust corpus, beginning of period
    (note 4)

$
2,393,340


$
1,827,273


$
1,909,252Cash earnings


2,094,226



6,586,512



10,178,621Cash distributions


(1,831,080
)


(6,002,945
)


(10,177,500
)Amortization of royalty interests
    (notes 4 and 6)


(40,300
)


(17,500
)


(83,100
)Trust corpus, end of period

$
2,616,186


$
2,393,340


$
1,827,273    52




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL STATEMENTS
  December 31, 2006, 2005 and 2004
  (1)  Formation
    of the Trust
        Status of
    the Trust
       53




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      South
    Pass 89
    Offshore
    Properties:
  East
    Cameron 336
    East
    Cameron 195
    South
    Marsh Island 76
   54




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Eugene
    Island 261
    Vermillion
    331
    Jay
    Field
             55




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    (2)  Going
    Concern
        (3)  Net
    Overriding Royalty Interests and Fee Lands Royalties
  Property-by-Property
   56




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
   (4)  Basis
    of Presentation
  Significant
    Accounting Policies
      out-of-pocket
  unit-of-production
        (5)  Federal
    Income Tax Matters
     57




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
       (6)  Impairment
      (7)  Dismantlement
    Costs
  Form 10-K
   58




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
     (8)  Contingencies
      (9)  Supplemental
    Reserve Information (Unaudited)
     59




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Present
    Value of Estimated Future Net Revenues from Proved
    Reserves
  September 30,2006


2005


2004(In thousands)The Trusts proportionate
    share of future gross proceeds

$
116,277


$
225,089


$
230,204Less the Trusts
    proportionate share of  Future operating costs


(3,844
)


(3,859
)


(4,430
)Future capital costs


(10,103
)


(10,638
)


(12,083
)Excess production costs


(3,155
)


(2,155
)


(2,486
)Future royalty income


99,175



208,437



211,205Discount at 10% per annum


(49,206
)


(94,069
)


(115,843
)Standardized measure of future
    royalty income from proved oil and gas reserves

$
49,969


$
114,368


$
95,362   Changes
    in Imputed Proved Reserves and Present Value of Estimated Future
    Net Revenues
  Present ValueImputed


of Future NetProved Reserves


RevenuesLiquids


Gas


(Thousands(Mbbl)


(MMcf)


of dollars)Estimated at September 30,
    2003


2,501



4,753


$
38,811Production


(88
)


(1,287
)

$
(10,858
)Revisions of estimates(1)


1,870



1,869



63,528Extensions, discoveries and other
    additions










Accretion of discount


na



na



3,881Estimated at September 30,
    2004


4,283



5,335


$
95,362Production


(56
)


(602
)

$
(7,355
)Revisions of estimates(1)


(1,249
)


1,530



16,825Extensions, discoveries and other
    additions










Accretion of discount


na



na



9,536Estimated at September 30,
    2005


2,978



6,263


$
114,368Production


(35
)


(37
)

$
(3,069
)Revisions of estimates(1)


(1,389
)


(4,316
)


(72,768
)Extensions, discoveries and other
    additions










Accretion of discount


na



na



11,437Estimated at September 30,
    2006


1,554



1,910


$
49,968  60




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##### Table of Contents



LL&E
    ROYALTY TRUST
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      (1)
    
    Revisions of estimates are due to the interaction of a number of
    factors, including: (i) changes in prices being received;
    (ii) changes in estimates of operating, capital and
    dismantlement costs; (iii) changes in the timing and
    amounts of estimated future production; and (iv) changes in
    the estimated remaining imputed proved reserves. The Trust noted
    that for the year ended September 30, 2006, base prices
    were $62.92 per barrel for oil, $3.66 per MMBtu for
    gas, and $      per barrel for
    natural gas liquids. For the year ended September 30, 2005,
    base prices were $65.00 per barrel for oil, $15.00 per
    MMBtu for gas, and $49.56 per barrel for natural gas
    liquids.  (10)  Selected
    Quarterly Financial Data (Unaudited)
  Summarized Quarterly ResultsThree Months EndedMarch 31


June 30


September 30


December 312006:Royalty revenues

$
432,197


$
297,042


$
689,169


$
1,650,230Cash distributions

$



$



$
383,018


$
1,448,062Cash distribution unit

$
0.0000


$
0.0000


$
0.0202


$
0.07622005:Royalty revenues

$
1,710,710


$
2,253,155


$
1,708,845


$
1,682,117Cash distributions

$
1,497,987


$
2,005,536


$
1,586,650


$
912,772Cash distribution unit

$
0.0789


$
0.1056


$
0.0835


$
0.0481  61




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  The Bank of New York Trust Company, N.A., Trustee
    and the Unit Holders of LL&E Royalty Trust:
            Internal Control 
    Integrated Framework
      62




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  
  Internal Control 
    Integrated Framework
        Internal Control  Integrated
    Framework Internal Control  Integrated
    Framework
        63




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure     Item 9A.
    Controls
    and Procedures  Evaluation of Controls and Procedures.
      Changes in Internal Control over Financial
    Reporting.
    Trustees Report on Internal Control over Financial
    Reporting. Rule 13a-15(f) Internal Control-Integrated Framework Internal Control-Integrated
    Framework,
  Item 9B.  Other Information   64




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##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers of the Registrant and Corporate
    Governance      Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters  (a) Unit Ownership of Certain Beneficial Owners
    (b) Unit Ownership of Management
    (c) Change in Control
    (d) Securities Authorized for Issuance Under Equity
    Compensation Plans
    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accounting Fees and Services    2006


2005Audit fees(1)

$
275,000


$
205,000Audit related fees






Tax fees(2)


179,000



100,000All other fees






Total fees

$
454,000


$
305,000     (1)
    
    Audit fees consist of fees for the audit of the LL&E Trust
    financial statements, internal control over financial reporting
    (in 2006) and reimbursement for travel related expenses. 65




---



##### Table of Contents



(2)
    
    Tax fees consist of fees related to the LL&E Trusts
    tax information for its unit holders.  Pre-Approval
    Policies
   PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules  (a)
    Financial Statements    PageNumberStatements of Cash Earnings and
    Distributions  Years Ended December 31, 2006,
    2005 and 2004


52Statements of Assets, Liabilities
    and Trust Corpus  December 31, 2006 and 2005


52Statements of Changes in
    Trust Corpus  Years Ended December 31,
    2006, 2005 and 2004


52Notes to Financial Statements


53Report of Independent Registered
    Public Accounting Firm


61Report of Independent Registered
    Public Accounting Firm


62   (b)
    Exhibits  4*




Agreement for LL&E Royalty
    Trust, dated as of June 1, 1983, between the Company and
    First City National Bank of Houston, as Trustee.28
.1*



Agreement of General Partnership
    of LL&E Royalty Partnership.28
.2*



Form of Conveyance of Overriding
    Royalty Interests for Fort Worth Basin Property.28
.3*



Form of Conveyance of Overriding
    Royalty Interests for Jay Field (Alabama) Property.28
.4*



Form of Conveyance of Overriding
    Royalty Interests for Jay Field (Florida) Property.28
.5*



Form of Conveyance of Overriding
    Royalty Interests for Offshore Louisiana Property.28
.6*



Form of Conveyance of Overriding
    Royalty Interests for South Pass 89 Property.28
.7*



Form of Royalty Deed.31




Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act of 200332




Certification pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2003     *
    
    Incorporated by reference to Exhibits of like designation to
    Registrants Annual Report on
    Form 10-K
    for the period ended December 31, 1983 (Commission File
    No. 1-8518).  (c)
    Financial Statement Schedules   66




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##### Table of Contents



SIGNATURE     (Registrant)
  By:
    THE BANK OF NEW YORK TRUST COMPANY, N.A., Trustee   By:
    /s/  MIKE ULRICH   Vice President
  Note:
    Because the registrant is a trust without officers or employees,
    only the signature of an officer of the Trustee is available and
    has been provided. 67




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##### Table of Contents



INDEX TO
    EXHIBITS
  4*




Trust Agreement for LL&E
    Royalty Trust, dated as of June 1, 1983, between the
    Company and First City National Bank of Houston, as Trustee.28
.1*



Agreement of General Partnership
    of LL&E Royalty Partnership.28
.2*



Form of Conveyance of Overriding
    Royalty Interests for Fort Worth Basin Property.28
.3*



Form of Conveyance of Overriding
    Royalty Interests for Jay Field (Alabama) Property.28
.4*



Form of Conveyance of Overriding
    Royalty Interests for Jay Field (Florida) Property.28
.5*



Form of Conveyance of Overriding
    Royalty Interests for Offshore Louisiana Property.28
.6*



Form of Conveyance of Overriding
    Royalty Interests for South Pass 89 Property28
.7*



Form of Royalty Deed.31




Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2003.32




Certification pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2003.     *
    
    Incorporated by reference to Exhibits of like designation to
    Registrants Annual Report on
    Form 10-K
    for the period ended December 31, 1983 (Commission File
    No. 1-8518).