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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q







|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended June 30, 2010

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

Commission File No. 000-10810





KIEWIT ROYALTY
TRUST

(Exact name of registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Nebraska                                                       |  | 47-6131402                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)

Trust Division

U.S. Bank National Association

1700 Farnam Street

Omaha, Nebraska 68102

(Address of principal executive offices and zip code)

(402) 348-6000

(Registrants telephone number, including area code)





Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-K during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    Yes   ̈    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):



|                        |  |                                                  |  |                           |  |  
|----------------------- |  | ------------------------------------------------ |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈                                                |  | Accelerated filer         |  |  ̈
|                        |  |                                                  | 
|Non-accelerated filer   |  |  ̈  (Do not check if a smaller reporting company) |  | Smaller reporting company |  | x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act)    Yes   ̈    No  x









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KIEWIT ROYALTY TRUST

FORM 10-Q

For
the Quarter Ended June 30, 2010

INDEX



|                              |  |                                                                                    |  |     
|----------------------------- |  | ---------------------------------------------------------------------------------- |  | ----
|                              |  |                                                                                    |  | Page
|                              | 
|Part I. FINANCIAL INFORMATION |  | 1                                                                                 
|                              |  |                                                                                   
|Item 1.                       |  | Financial Statements                                                               |  | 1   
|                              |  |                                                                                   
|Item 2.                       |  | Trustees Discussion and Analysis of Financial Condition and Results of Operations |  | 5   
|                              |  |                                                                                   
|Item 4.                       |  | Controls and Procedures                                                            |  | 6   
|                              | 
|Part II. OTHER INFORMATION    |  | 7                                                                                 
|                              |  |                                                                                   
|Item 1.                       |  | Legal Proceedings                                                                  |  | 7   
|                              |  |                                                                                   
|Item 6.                       |  | Exhibits                                                                           |  | 7   

Forward-Looking
Statements

This Form 10-Q, including specifically the section entitled Trustees Discussion and Analysis of Financial
Condition and Results of Operations, includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor created
thereby. All statements other than statements of historical fact included in this Form 10-Q are forward-looking statements. Such statements include, without limitation, certain statements regarding the Trusts financial position, industry
conditions and other matters contained in this Form 10-Q. Although the Trustee believes that the expectations reflected in such forward-looking statements are reasonable, such expectations are subject to numerous risks and uncertainties, and the
Trustee can give no assurance that they will prove correct. There are many factors, none of which is within the Trustees control, that may cause such expectations not to be realized, including, among other things, factors identified in the
Trusts Form 10-K for the year ended December 31, 2009.



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PART I  FINANCIAL INFORMATION

Item 1. Financial Statements.

KIEWIT ROYALTY TRUST

STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS

June 30, 2010 and

December 31, 2009

(unaudited)



|                                                                                        |  |              |          |   |                  |   |          |  
|--------------------------------------------------------------------------------------- |  | ------------ | -------- | - | ---------------- | - | -------- | -
|                                                                                        |  | June 30,2010 |          |   | December 31,2009 |  
|                                                                                        |  |             
|Assets                                                                                  |  |              |          |   |                  |   |          |  
|Cash and cash equivalents                                                               |  | $            | 40,272   |   |                  | $ | 46,340   |  
|Royalty and overriding royalty interests in coal leases                                 |  |              | 167,817  |   |                  |   | 167,817  |  
|Less accumulated amortization                                                           |  |              | (164,896 | ) |                  |   | (158,214 | )
|                                                                                        |  |              |          |   |                  |   |          |  
|                                                                                        |  |             
|Net royalty and overriding royalty interests in coal leases                             |  |              | 2,921    |   |                  |   | 9,603    |  
|                                                                                        |  |              |          |   |                  |   |          |  
|                                                                                        |  |             
|Total assets                                                                            |  | $            | 43,193   |   |                  | $ | 55,943   |  
|                                                                                        |  |              |          |   |                  |   |          |  
|                                                                                        |  |             
|Liabilities                                                                             |  |              |          |   |                  |   |          |  
|Distributions payable to unit holders                                                   |  | $            | 31,340   |   |                  | $ | 46,340   |  
|Accounts payable                                                                        |  |              | 8,932    |   |                  |   |         |  
|                                                                                        |  |             
|Trust Corpus:12,633,432 units of beneficial interest authorized, issued and outstanding |  |              | 2,921    |   |                  |   | 9,603    |  
|                                                                                        |  |              |          |   |                  |   |          |  
|                                                                                        |  |             
|Total liabilities and trust corpus                                                      |  | $            | 43,193   |   |                  | $ | 55,943   |  
|                                                                                        |  |              |          |   |                  |   |          |  

The accompanying notes are an integral part of the financial statements.



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KIEWIT ROYALTY TRUST

STATEMENTS OF DISTRIBUTABLE INCOME

For the three and six months ended June 30, 2010 and 2009

(unaudited)



|                              |  |                             |           |   |      |   |           |  
|----------------------------- |  | --------------------------- | --------- | - | ---- | - | --------- | -
|                              |  | Three Months Ended June 30, |          
|                              |  | 2010                        |           |   | 2009 |  
|                              |  |                            
|Royalty income                |  | $                           | 71,529    |   |      | $ | 110,274   |  
|Interest income               |  |                             |          |   |      |   | 26        |  
|Trust expenses                |  |                             | (31,257   | ) |      |   | (25,178   | )
|                              |  |                             |           |   |      |   |           |  
|                              |  |                            
|Distributable income          |  | $                           | 40,272    |   |      | $ | 85,122    |  
|                              |  |                             |           |   |      |   |           |  
|                              |  |                            
|Distributable income per unit |  | $                           | 0.0031877 |   |      | $ | 0.0067378 |  
|                              |  |                             |           |   |      |   |           |  



|                                                                                                |  |                           |           |   |      |   |           |  
|----------------------------------------------------------------------------------------------- |  | ------------------------- | --------- | - | ---- | - | --------- | -
|                                                                                                |  | Six Months Ended June 30, |          
|                                                                                                |  | 2010                      |           |   | 2009 |  
|                                                                                                |  |                          
|Royalty income                                                                                  |  | $                         | 671,204   |   |      | $ | 765,834   |  
|Interest income                                                                                 |  |                           |          |   |      |   | 355       |  
|Trust expenses                                                                                  |  |                           | (55,456   | ) |      |   | (83,414   | )
|                                                                                                |  |                           |           |   |      |   |           |  
|                                                                                                |  |                          
|Distributable income                                                                            |  | $                         | 615,748   |   |      | $ | 682,775   |  
|                                                                                                |  |                           |           |   |      |   |           |  
|                                                                                                |  |                          
|Distributable income per unit                                                                   |  | $                         | 0.0487396 |   |      | $ | 0.0540451 |  
|                                                                                                |  |                           |           |   |      |   |           |  
|                                                                                               
|STATEMENTS OF CHANGES IN TRUST CORPUSFor the six months ended June 30, 2010 and 2009(unaudited) | 
|                                                                                                | 
|                                                                                                |  | Six Months Ended June 30, |          
|                                                                                                |  | 2010                      |           |   | 2009 |  
|                                                                                                |  |                          
|Trust corpus, beginning of year                                                                 |  | $                         | 9,603     |   |      | $ | 22,890    |  
|Amortization of royalty interest                                                                |  |                           | (6,682    | ) |      |   | (3,982    | )
|Distributable income                                                                            |  |                           | 615,748   |   |      |   | 682,775   |  
|Distributions payable to unit holders                                                           |  |                           | (606,816  | ) |      |   | (682,775  | )
|Accounts payable                                                                                |  |                           | (8,932    | ) |      |   |          |  
|                                                                                                |  |                           |           |   |      |   |           |  
|                                                                                                |  |                          
|Trust corpus                                                                                    |  | $                         | 2,921     |   |      | $ | 18,908    |  
|                                                                                                |  |                           |           |   |      |   |           |  

The accompanying notes are an integral part of the financial statements.



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KIEWIT ROYALTY

TRUST NOTES TO FINANCIAL STATEMENTS

(unaudited)

Basis of
Presentation

The accompanying financial statements have been prepared in accordance with the instructions for Form 10-Q and do not
necessarily include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of U.S. Bank National Association, as sole trustee of the Trust (the
Trustee), all adjustments necessary for a fair presentation have been included. For further information, refer to the financial statements and footnotes included in the Trusts Annual Report on Form 10-K for the year ended
December 31, 2009.

Summary of Significant Accounting Policies



|(a) | Basis of Accounting:
|--- | --------------------

The financial
statements of the Trust, as prepared on the modified cash basis, reflect the Trusts assets, liabilities, trust corpus, and distributable income as follows:

1. Royalty income and interest income are recognized in the month in which amounts are received by the Trust.

2. Trust expenses, consisting principally of routine general and administrative costs, include payments made during the accounting period.

3. Reserves for liabilities that are contingent or uncertain in amount may also be established if considered necessary.

4. Net royalty and overriding royalty interests that are producing properties are amortized using the unit-of-production
method. This amortization is shown as a reduction of Trust corpus.

5. Distributions to Unit Holders are recognized when
declared by the Trustee.

6. Production withholding taxes withheld from Unit Holder distributions and remitted to governmental
authorities are accounted for on a net basis and therefore are excluded from royalty income in the statement of distributable income.

The
financial statements of the Trust differ from financial statements prepared in conformity with U.S. generally accepted accounting principles because of the following:



| |  |  | Royalty income and interest are recognized in the month received rather than in the month of production.
| | - |  | --------------------------------------------------------------------------------------------------------



| |  |  | Expenses generally are not accrued.
| | - |  | -----------------------------------



| |  |  | Amortization of the net royalty and overriding royalty interests is shown as a reduction to Trust corpus and not as a charge to operating results.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Reserves may be established for contingencies that would not be recorded under U.S. generally accepted accounting principles.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------



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These statements differ from financial statements prepared in accordance with accounting principles
generally accepted in the United States of America (GAAP) and were prepared on the modified cash basis of reporting, which is considered to be the most meaningful because Distributions to Unit Holders are based on net cash receipts. This
comprehensive basis of accounting, other than GAAP, corresponds to the accounting permitted for royalty trusts by the U.S. Securities and Exchange Commission as specified by Staff Accounting Bulletin Topic 12E, Financial Statements of Royalty
Trusts.



|(b) | Cash and Cash Equivalents:
|--- | --------------------------

The Trust
considers all highly liquid financial instruments with original maturities of three months or less when purchased to be cash equivalents.



|(c) | Related Party:
|--- | --------------

The Trust was organized
to provide an efficient, orderly and practical means of administering the income received from royalty interests and is administered by the Trustee. Pursuant to the terms of the Trust Indenture, the Trust pays the Trustee $40,000 per year. The
Trustee may readjust this fee annually in its sole discretion, and on May 12, 2010, the Trustee notified the Unit Holders that the Trustee readjusted the fee to $80,000 per year, effective October 1, 2010.



|(d) | Subsequent Events:
|--- | ------------------

In accordance with
the provisions of Financial Accounting Standards Board (FASB) Statement on Subsequent Events, we have evaluated the Trust activity and have concluded that there are no material subsequent events requiring additional disclosure or
recognition in these financial statements.



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Item 2. Trustees Discussion and Analysis of Financial Condition and
Results of Operations.

Overview.

Kiewit Royalty Trust (the Trust) is a royalty trust with royalty and overriding royalty interests in certain coal leases. The Trust was formed
for the purposes of administering the income received from such coal leases and distributing such income (together with interest earned thereon, if any, less payment of or provision for obligations) to the holders of the units of beneficial
interest.

During the three-month and six-month periods ended June 30, 2010, the Trust received a total of $71,529 and $671,204,
respectively, of royalty and overriding royalty payments. The following schedule reflects the royalty and overriding royalty payments, net of production withholding taxes, received by the Trust in respect of leases at the following mines:



|                     |  |                             |        |      |   |        
|-------------------- |  | --------------------------- | ------ | ---- | - | -------
|                     |  | Three Months Ended June 30,
|                     |  | 2010                        |        | 2009
|                     |  |                            
|Decker Mine          |  | $                           | 21,529 |      | $ | 60,274 
|Spring Creek Mine    |  |                             | 50,000 |      |   | 50,000 
|                     |  |                             |        |      |   |        
|Total Royalty Income |  | $                           | 71,529 |      | $ | 110,274
|                     |  |                             |        |      |   |        



|                     |  |                           |         |      |   |        
|-------------------- |  | ------------------------- | ------- | ---- | - | -------
|                     |  | Six Months Ended June 30,
|                     |  | 2010                      |         | 2009
|                     |  |                          
|Decker Mine          |  | $                         | 621,204 |      | $ | 715,834
|Spring Creek Mine    |  |                           | 50,000  |      |   | 50,000 
|                     |  |                           |         |      |   |        
|Total Royalty Income |  | $                         | 671,204 |      | $ | 765,834
|                     |  |                           |         |      |   |        

Decker Mine.Royalty and overriding royalty amounts received by
the Trust from the Decker Mine decreased to $21,529 during the second quarter of 2010, as compared to $60,274 received during the same period in 2009. This change was the net result of changes in the relative amounts of coal mined, which was a
normal result of the execution of a mining plan encompassing several coal leases. Seasonal fluctuations occur in the relative amounts of coal mined under the leases with a majority of the royalty payments being received during the first and third
calendar quarters of the year.

Spring Creek Mine.No royalties were received from the Spring Creek Mine during the first three months
of 2010 and 2009 because royalties with respect to this mine are typically paid by the mine operators on an annual basis during the second half of the calendar year. The Trust received a payment of $50,000 during both the second quarter of 2009 and
2010.

Interest Income. The Trust generally earns interest on the royalty payments prior to the distribution to the Unit Holders. Due
to money market rates, funds held by the Trust did not earn any interest during the three months and six months ended June 30, 2010, as compared to $26 and $355 during the same periods in 2009, respectively. The Federal Reserve lowered interest
rates during the second half of 2009, and rates have not materially increased since that time. The lower interest rates contributed to the decrease in interest earned by the Trust.



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Trust Expenses.Trust expenses decreased to $55,456 for the first six months of 2010, as compared to
$83,414 for the same period in 2009. This change is related to the decrease in audit, accounting, legal and administrative fees. During the three month period ended June 30, 2010, trust expenses increased to $31,257 from $25,178 during the same
three month period in 2009. These expenses increased due to the retention of a new auditor and an alternate fee payment schedule.

Liquidity and Capital Resources. The Trusts sole source of capital is the royalty payments. In accordance with the provisions of the Trust
Indenture, generally all income received by the Trust, net of Trust expenses and any amounts placed in reserves, is distributed to the Unit Holders on a quarterly basis. During the quarter ended June 30, 2010, the Trust established a reserve in
the amount of $8,932 for the payment of expenses. Effective October 1, 2010, the Trust will pay the Trustee a fee of $20,000 per quarter, an increase of $10,000 per quarter.

Change in Trust Corpus. During the second quarter of 2010, the trust corpus decreased from $4,908 to $2,921, resulting from $1,987 of amortization
of royalty interest from one of the Decker Mine leases. No other royalty interests are amortized.

Off-Balance Sheet Arrangements.As
required by the Trust Indenture, the Trust is intended to be passive in nature and the Trustee does not have any control over or any responsibility relating to the operation of the mines under which the Trust has any royalty interests and overriding
royalty interests. The Trustee has powers to collect and distribute proceeds received by the Trust and pay Trust liabilities and expenses and its actions have been limited to those activities. As a result, the Trust has not engaged in any
off-balance sheet arrangements.

Critical Accounting Policies and Estimates.The Trusts financial statements are prepared on a
modified cash basis of accounting and as such there are no critical accounting policies or estimates.

Item 4.
Controls and Procedures.

Evaluation of Disclosure Controls and Procedures.As of the end of the period covered by this Form 10-Q,
officers of the Trustee conducted an evaluation of the Trusts disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934). Based upon this evaluation, the officers of the Trustee concluded that the
Trusts disclosure controls and procedures were effective in timely alerting them of any material information relating to the Trust that is required to be disclosed by the Trust in the reports it files or submits under the Securities Exchange
Act of 1934.

Changes in Internal Control Over Financial Reporting.There were no changes in the Trusts internal control over
financial reporting (as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934) that occurred during the Trusts most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, the
Trusts internal control over financial reporting.

Limitations on Controls.The Trustee does not expect that the Trusts
disclosure controls and procedures of the Trusts internal control over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can
provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of
fraud, if any, within the Trust have been detected.



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PART II  OTHER INFORMATION

Item 1. Legal Proceedings.

There are no material legal proceedings to which the Trust is a party.

Item 6. Exhibits.



|    |  |                                                                                                                                                                                                                                                        
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1 |  | Kiewit Royalty Trust Indenture dated May 17, 1982, as amended June 9, 1982 and June 23, 1982 (filed as Exhibit 4.1 to the Trusts Form 10-K filed with the
Securities and Exchange Commission on March 28, 2003, and incorporated herein by reference).
|    | 
|4.2 |  | Order dated September 23, 1994, of the County Court of Douglas County, Nebraska (filed as Exhibit 4.2 to the Trusts Form 10-K filed with the Securities and Exchange Commission
on March 28, 2003, and incorporated herein by reference).             
|    | 
|31* |  | Certification of Trust Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.                                                                                                                                                         
|    | 
|32* |  | Certification of Trust Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                               



|* | Filed herewith
|- | --------------



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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



|                       |  |                      |  |                                       |  |                                
|---------------------- |  | -------------------- |  | ------------------------------------- |  | -------------------------------
|                       |  | KIEWIT ROYALTY TRUST
|                       |  |                     
|                       |  | By:                  |  | U.S. Bank National Association in its
|                       |  |                      |  | capacity as Trustee and not in its   
|                       |  |                      |  | individual capacity or otherwise     
|Dated: August 11, 2010 |  |                      |  |                                       |  |                                
|                       |  |                      |  | By:                                   |  | Luke H. Paladino               
|                       |  |                      |  |                                       |  | Luke H. Paladino, Trust Officer

(The
Trust does not have a principal financial or chief accounting officer or any other officers.)



8