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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 September 30, 2009

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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##### Table of Contents

KIEWIT ROYALTY TRUST

FORM 10-Q

For the
Quarter Ended September 30, 2009

INDEX



|                                                                                           |  |     
|------------------------------------------------------------------------------------------ |  | ----
|                                                                                           |  | Page
|Part I. FINANCIAL INFORMATION                                                              |  | 1   
|                                                                                           | 
|Item 1. Financial Statements                                                               |  | 1   
|                                                                                           | 
|Item 1A. Risk Factors                                                                      |  | 5   
|                                                                                           | 
|Item 2. Trustees Discussion and Analysis of Financial Condition and Results of Operations |  | 5   
|                                                                                           | 
|Item 4T. 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 most recent Form
10-K.



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PART I  FINANCIAL INFORMATION

Item 1. Financial Statements.

KIEWIT ROYALTY TRUST

STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS

September 30, 2009 and

December 31, 2008

(unaudited)



|                                                                                        |  |                   |           |   |                  |   |          |  
|--------------------------------------------------------------------------------------- |  | ----------------- | --------- | - | ---------------- | - | -------- | -
|                                                                                        |  | September 30,2009 |           |   | December 31,2008 |  
|                                                                                        |  |                  
|Assets                                                                                  |  |                   |           |   |                  |   |          |  
|Cash and cash equivalents                                                               |  | $                 | 2,523,526 |   |                  | $ | 96,761   |  
|Royalty and overriding royalty interests in coal leases                                 |  |                   | 167,817   |   |                  |   | 167,817  |  
|Less accumulated amortization                                                           |  |                   | (151,930  | ) |                  |   | (144,927 | )
|                                                                                        |  |                   |           |   |                  |   |          |  
|                                                                                        |  |                  
|Net royalty and overriding royalty interests in coal leases                             |  |                   | 15,887    |   |                  |   | 22,890   |  
|                                                                                        |  |                   |           |   |                  |   |          |  
|                                                                                        |  |                  
|Total assets                                                                            |  | $                 | 2,539,413 |   |                  | $ | 119,651  |  
|                                                                                        |  |                   |           |   |                  |   |          |  
|                                                                                        |  |                  
|Liabilities                                                                             |  |                   |           |   |                  |   |          |  
|Distributions payable to unit holders                                                   |  | $                 | 2,523,526 |   |                  | $ | 96,761   |  
|                                                                                        |  |                  
|Trust Corpus:12,633,432 units of beneficial interest authorized, issued and outstanding |  |                   | 15,887    |   |                  |   | 22,890   |  
|                                                                                        |  |                   |           |   |                  |   |          |  
|                                                                                        |  |                  
|Total liabilities and trust corpus                                                      |  | $                 | 2,539,413 |   |                  | $ | 119,651  |  
|                                                                                        |  |                   |           |   |                  |   |          |  

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 nine months ended September 30, 2009 and 2008

(unaudited)



|                              |  |                                 |           |   |      |   |           |  
|----------------------------- |  | ------------------------------- | --------- | - | ---- | - | --------- | -
|                              |  | Three Months EndedSeptember 30, |          
|                              |  | 2009                            |           |   | 2008 |  
|                              |  |                                
|Royalty income                |  | $                               | 2,544,046 |   |      | $ | 2,485,993 |  
|Interest income               |  |                                 |          |   |      |   | 7,887     |  
|Trust expenses                |  |                                 | (20,520   | ) |      |   | (17,895   | )
|                              |  |                                 |           |   |      |   |           |  
|                              |  |                                
|Distributable income          |  | $                               | 2,523,526 |   |      | $ | 2,475,985 |  
|                              |  |                                 |           |   |      |   |           |  
|                              |  |                                
|Distributable income per unit |  | $                               | 0.1997498 |   |      | $ | 0.1959867 |  
|                              |  |                                 |           |   |      |   |           |  
|                              | 
|                              |  | Nine Months EndedSeptember 30,  |          
|                              |  | 2009                            |           |   | 2008 |  
|                              |  |                                
|Royalty income                |  | $                               | 3,309,880 |   |      | $ | 3,365,637 |  
|Interest income               |  |                                 | 355       |   |      |   | 12,455    |  
|Trust expenses                |  |                                 | (103,934  | ) |      |   | (93,367   | )
|                              |  |                                 |           |   |      |   |           |  
|                              |  |                                
|Distributable income          |  | $                               | 3,206,301 |   |      | $ | 3,284,725 |  
|                              |  |                                 |           |   |      |   |           |  
|                              |  |                                
|Distributable income per unit |  | $                               | 0.2537949 |   |      | $ | 0.2600026 |  
|                              |  |                                 |           |   |      |   |           |  

STATEMENTS OF CHANGES IN TRUST CORPUS

For the nine months ended September 30, 2009 and 2008

(unaudited)



|                                      |  |                                    |            |   |                                    |   |            |  
|------------------------------------- |  | ---------------------------------- | ---------- | - | ---------------------------------- | - | ---------- | -
|                                      |  | Nine Months EndedSeptember 30,2009 |            |   | Nine Months EndedSeptember 30,2008 |  
|                                      |  |                                   
|Trust corpus, beginning of year       |  | $                                  | 22,890     |   |                                    | $ | 22,890     |  
|Amortization of royalty interest      |  |                                    | (7,003     | ) |                                    |   |           |  
|Distributable income                  |  |                                    | 3,206,301  |   |                                    |   | 3,284,725  |  
|Distributions payable to unit holders |  |                                    | (3,206,301 | ) |                                    |   | (3,284,725 | )
|                                      |  |                                    |            |   |                                    |   |            |  
|                                      |  |                                   
|Trust corpus                          |  | $                                  | 15,887     |   |                                    | $ | 22,890     |  
|                                      |  |                                    |            |   |                                    |   |            |  

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, 2008.

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 adjust this fee annually in its sole discretion.



|(d) | Recently Issued Accounting Pronouncements:
|--- | ------------------------------------------

In May 2009, the Financial Accounting Standards Board (FASB) issued a Statement on Subsequent Events. This Statement establishes the standards of accounting for and disclosure of events that occur after the balance sheet date
but before financial statements are issued or are available to be issued. This Statement became effective for interim or annual periods ending after June 15, 2009. In accordance with the provisions of this Statement, we have evaluated
subsequent events through November 6, 2009, which is the date of our Form 10-Q filing. No subsequent events requiring recognition were identified and therefore none were incorporated into the financial statements presented herein. Upon
adoption, this Statement had no impact on our financial statements.

In June 2009, the FASB issued a Statement on the Accounting Standards
Codification and the Hierarchy of Generally Accepted Accounting Principles, which became effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Codification will become the source of
authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification
superseded all previously existing non-SEC accounting and reporting standards. All other non-grandfathered non-SEC accounting literature not included in the Codification became nonauthoritative. Upon adoption, this Statement had no impact on our
financial statements.



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Item 1A. Risk Factors.

There have not been any material changes to the Risk Factors previously disclosed in the Form 10-K for the year ended December 31, 2008.

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 less payment of or provision for obligations) to the holders of the Units of Beneficial Interest.

Results of Operations.

During the three month and nine month periods ended September 30, 2009, the Trust received a
total of $2,544,046 and $3,309,880, 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 EndedSeptember 30,
|               |  | 2009                            |           | 2008
|               |  |                                
|Decker         |  | $                               | 713,994   |      | $ | 725,254  
|Spring Creek   |  |                                 | 1,830,052 |      |   | 1,760,739
|               |  |                                 |           |      |   |          
|Royalty Income |  | $                               | 2,544,046 |      | $ | 2,485,993
|               |  |                                 |           |      |   |          
|               | 
|               |  | Nine Months EndedSeptember 30, 
|               |  | 2009                            |           | 2008
|               |  |                                
|Decker         |  | $                               | 1,429,828 |      | $ | 1,604,898
|Spring Creek   |  |                                 | 1,880,052 |      |   | 1,760,739
|               |  |                                 |           |      |   |          
|Royalty Income |  | $                               | 3,309,880 |      | $ | 3,365,637
|               |  |                                 |           |      |   |          

Decker Mine.Royalty and overriding royalty amounts received by the Trust from the Decker Mine
decreased slightly to $713,994 during the third quarter of 2009, as compared to $725,254 received during the same period in 2008. For the nine months ended September 30, 2009, royalty and overriding royalty amounts decreased by $175,070, or
11%, to $1,429,828. These changes were the net result of changes in the relative amounts of coal mined under leases bearing different overriding royalty rates per ton, which were a normal result of the execution of a mining plan encompassing several
coal leases bearing different royalty rates. 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.Royalties with respect to this mine are typically paid by the mine operators on an annual basis later during the
calendar year. During the third quarter of 2009, the Trust received a payment of $1,830,052, representing an increase of $69,313, or 4%, as compared to the third quarter of 2008. For the nine month period ended September 30, 2009, royalty and
overriding royalty amounts increased by $119,313, or 7%, to $1,880,052. The increases resulted from additional tons of coal produced under the Spring Creek Mine leases.



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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 earned nominal interest in July 2009 and did not earn any interest in August or September 2009. For the three months ended September 30, 2008, the Trust reported interest
income of $7,887. For the nine months ended September 30, 2009, the Trust reported interest income of $355 as compared to $12,455 for the nine months ended September 30, 2008. This decrease resulted from significant cuts in interest rates
beginning in late 2008.

Trust Expenses.Trust expenses increased to $103,934 in the first nine months of 2009, as compared to $93,367
for the same period in 2008. This change is related to the increase in audit, accounting, legal and administrative fees. During the three month period ended September 30, 2009, trust expenses increased from $17,895 to $20,520.

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 September 30, 2009, the Trust did not establish
any reserves.

Change in Trust Corpus. During the first nine months of 2009, the trust corpus decreased from $22,890 to $15,887,
resulting from $7,003 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 4T. 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.

During the second and third fiscal quarters of 2008, the Trustee identified certain internal control weaknesses relating to cash receipt cutoff for the Trust and determined that such controls were not
effective. In June 2009, the Trust adopted a Cash Receipt Policy to remediate this material weakness and ensure that the Trust prepares its financial statements on a modified cash basis of



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accounting. The Trust implemented this Cash Receipt Policy in July 2009 for the quarter ended June 30, 2009. The Trust complied with the Cash Receipt Policy for the quarters ended
June 30, 2009 and September 30, 2009. The Trust determined that the internal controls over financial reporting established within the Cash Receipt Policy had operated effectively for a sufficient length of time and, as such, the Trust
determined that the material weakness had been remediated.

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.

PART II  OTHER INFORMATION

Item 1. Legal Proceedings.

There are no material legal proceedings to which the Trust is a party or to which any of its property is subject.

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: November 6, 2009 |  |                      |  |                                                                                                           |  |                                
|                        |  |                      | 
|                        |  |                      |  | By:                                                                                                       |  | /S/    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