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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





Form 10-K







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

For the fiscal year ended December 31, 2015

OR



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

For the transition period from
 to
.

Commission file number 000-08677





Tidelands
Royalty Trust B

(Exact name of registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Texas                                                          |  | 75-6007863                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)



|                                                                                |  |           
|------------------------------------------------------------------------------- |  | ----------
|c/o The Corporate Trustee
Southwest Bank 2911
Turtle Creek Blvd., Dallas, Texas |  | 75219     
|(Address of principal executive offices)                                        |  | (Zip Code)

Registrants telephone number, including area code (at the office of the Trustee): (855) 588-7839

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Units of Beneficial Interest





Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act.    YES   ̈    NO  x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act.    YES   ̈    NO  x



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 corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) 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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form
10-K.  x

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 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

The aggregate market value of the units of beneficial interest held by non-affiliates of the registrant at June 30, 2015 (the last
business day of the registrants most recently completed second fiscal quarter) was approximately $1,447,713. (For purposes of determining the above stated amount, only directors, executive officers and 10% or greater stockholders have been
deemed affiliates).

The number of units of beneficial interest outstanding as of March 30, 2016 was 1,386,375 units.

Documents incorporated by reference: None.









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TABLE OF CONTENTS



|         |  |                                                                                                              |  |  |    | 
|-------- |  | ------------------------------------------------------------------------------------------------------------ |  |  | -- | 
|PART I   |  |                                                                                                              |  | 
|         |  |                                                                                                             
|Item 1.  |  | Business                                                                                                     |  |  | 2  | 
|         |  |                                                                                                             
|Item 1A. |  | Risk Factors                                                                                                 |  |  | 5  | 
|         |  |                                                                                                             
|Item 1B. |  | Unresolved Staff Comments                                                                                    |  |  | 9  | 
|         |  |                                                                                                             
|Item 2.  |  | Properties                                                                                                   |  |  | 9  | 
|         |  |                                                                                                             
|Item 3.  |  | Legal Proceedings                                                                                            |  |  | 11 | 
|         |  |                                                                                                             
|Item 4.  |  | Mine Safety Disclosures                                                                                      |  |  | 11 | 
|         | 
|PART II  |  |                                                                                                              |  | 
|         |  |                                                                                                             
|Item 5.  |  | Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities |  |  | 11 | 
|         |  |                                                                                                             
|Item 6.  |  | Selected Financial Data                                                                                      |  |  | 13 | 
|         |  |                                                                                                             
|Item 7.  |  | Trustees Discussion and Analysis of Financial Condition and Results of Operations                           |  |  | 14 | 
|         |  |                                                                                                             
|Item 7A. |  | Quantitative and Qualitative Disclosures About Market Risk                                                   |  |  | 17 | 
|         |  |                                                                                                             
|Item 8.  |  | Financial Statements and Supplementary Data                                                                  |  |  | 17 | 
|         |  |                                                                                                             
|Item 9.  |  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                         |  |  | 17 | 
|         |  |                                                                                                             
|Item 9A. |  | Controls and Procedures                                                                                      |  |  | 17 | 
|         |  |                                                                                                             
|Item 9B. |  | Other Information                                                                                            |  |  | 18 | 
|         | 
|PART III |  |                                                                                                              |  | 
|         |  |                                                                                                             
|Item 10. |  | Directors, Executive Officers and Corporate Governance                                                       |  |  | 19 | 
|         |  |                                                                                                             
|Item 11. |  | Executive Compensation                                                                                       |  |  | 19 | 
|         |  |                                                                                                             
|Item 12. |  | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters               |  |  | 19 | 
|         |  |                                                                                                             
|Item 13. |  | Certain Relationships and Related Transactions, and Director Independence                                    |  |  | 20 | 
|         |  |                                                                                                             
|Item 14. |  | Principal Accountant Fees and Services                                                                       |  |  | 20 | 
|         | 
|PART IV  |  |                                                                                                              |  | 
|         |  |                                                                                                             
|Item 15. |  | Exhibits and Financial Statement Schedules                                                                   |  |  | 21 | 



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Part I



|Item 1. | Business
|------- | --------

Organization. Tidelands Royalty Trust
B (the Trust) is a royalty trust that was created on June 1, 1954 under the laws of the State of Texas. The Trust is not permitted to engage in any business activity because it was organized for the sole purpose of
providing an efficient, orderly and practical means for the administration and liquidation of rights to interests in certain oil, natural gas or other mineral leases obtained by Gulf Oil Corporation (Gulf) in a designated area of the
Gulf of Mexico. These rights are evidenced by a contract between the Trusts predecessors and Gulf dated April 30, 1951 (the 1951 Contract), which is binding upon the assignees of Gulf. As a result of various transactions that
have occurred since 1951, the Gulf interests that were subject to the 1951 Contract now are held by Chevron U.S.A., Inc. (Chevron), which is a subsidiary of Chevron Corporation, and its respective assignees.

The Tidelands Royalty Trust B Indenture, effective June 1, 1954, as amended (the Indenture), provides that the
corporate trustee is to distribute all cash in the Trust, excluding cash retained by its subsidiary, less an amount reserved for the payment of accrued liabilities and estimated future expenses, to unitholders of record on the last business day of
March, June, September and December of each year. Pursuant to the terms of the Indenture, all distributions will be sent within 15 calendar days of the record date. The Indenture prohibits the operation of any kind of trade or business by the Trust.

The Indenture provides that the term of the Trust will expire on April 30, 2021, unless extended by the vote of the holders of a
majority of the outstanding units of beneficial interest.

Southwest Bank has served as corporate trustee of the Trust since May 30,
2014. Previously, U.S. Trust, Bank of America Private Wealth Management served as the Trusts corporate trustee. Unless the context indicates otherwise, all references herein to the Trustee when used in the present tense, or
prospectively, refer to Southwest Bank, and when used in a historical context for the period prior to May 30, 2014, refer to U.S. Trust, Bank of America Private Wealth Management.

The Trusts wholly-owned subsidiary, Tidelands Royalty B Corporation (Tidelands Corporation, collectively with
the Trust, Tidelands), holds title to interests in properties subject to the 1951 Contract that are situated offshore of Louisiana. Ninety-five percent of all oil, natural gas and other mineral royalties collected by Tidelands
Corporation, less the cost of receiving and collecting, are retained by and delivered to the Trust. Tidelands Corporation retains the remaining 5% of the overriding royalties along with other items of income and expense until such time as the board
of directors declares a dividend out of retained earnings. Tidelands Corporation, like the Trust, is prohibited from engaging in a trade or business and does only those things necessary for the administration and liquidation of its properties.

Tidelands only industry segment or purpose is the administration and collection of royalties.

The 1951 Contract. The 1951 Contract identifies 60 specific tracts (the Tracts) in the Gulf of Mexico. The Tracts are not
all the same size and collectively contain approximately 1,370,000 acres. Prior to the expiration of the 50-year lease acquisition period on April 30, 2001 (the Acquisition Expiration Date),
if Chevron or its assignees had acquired a lease or leases on one of the Tracts, and if oil or natural gas were produced and sold from any such Tract, then Chevron or its assignees had to make production payments to Tidelands, in an amount equal to
approximately 12.5% of the value at the wellhead of the oil and natural gas subject to such lease until the sum of $1,500,000 was paid to Tidelands under the lease. The $1,500,000 production payment was paid on five leases. Thereafter,
Tidelands interest in such Tracts converted to an overriding royalty as described below. As described below, five of the Tracts had leases and rights to the other 55 Tracts expired at the Acquisition Expiration Date. One of the five leases (on
Galveston Area Block 303) terminated in 2012 due to lack of production from the wells on the lease.

As of March 30, 2016, Tidelands
had an overriding royalty interest in four oil and natural gas leases covering 17,188 gross acres in the Gulf of Mexico in the Sabine Pass and West Cameron areas (collectively, the Royalty Area). As of March 30, 2016, all four of
Tidelands assigned leases contained active wells. Tidelands



2



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overriding royalty interest on three of the four current leases is 4.1662%. On the fourth lease, the overriding royalty interest is 1.0416%. The overriding royalty interest on the fourth lease is
lower because Chevron only acquired a 25% working interest in the lease.

Since the Acquisition Expiration Date has passed, Chevron and
its assignees are no longer obligated to assign any interest to Tidelands out of any lease that they acquire on any of the Tracts. Tidelands will continue to be entitled to receive payments on four of the leases Chevron or its assignees acquired
prior to the Acquisition Expiration Date, so long as such leases are active properties. The four leases in which Tidelands had an overriding royalty interest during 2015 are identified in the table below:



|             |  |       |     |  |             |  |      |       |  |  |                 |  |  |               |        |   |             |   |                           |  |  |                                                                         |  |                                                                                                             
|------------ |  | ----- | --- |  | ----------- |  | ---- | ----- |  |  | --------------- |  |  | ------------- | ------ | - | ----------- | - | ------------------------- |  |  | ----------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------
|Area         |  | Block |     |  | LeaseNumber |  |      | Acres |  |  | RoyaltyInterest |  |  | 2015Royalties |        |   | Operator(s) |   | Working Interest
Owner(s)
|Sabine Pass  |  |       | 13  |  |             |  | 3959 |       |  |  | 3,438           |  |  |               | 4.1662 | % |             | $ | 224,519                   |  |  | Black Elk Energy Offshore Operations, LLC/ Renaissance Offshore LLC (1) |  | Black Elk Energy Offshore Operations, LLC/Renaissance Offshore LLC (100% Ownership Interest) (1)            
|West Cameron |  |       | 165 |  |             |  | 758  |       |  |  | 5,000           |  |  |               | 4.1662 | % |             | $ | 141,059                   |  |  | Apache Corporation/Fieldwood Energy LLC (2)                             |  | Apache Corporation/Fieldwood Energy LLC (100.00% Ownership Interest) (2)                                    
|West Cameron |  |       | 225 |  |             |  | 900  |       |  |  | 3,750           |  |  |               | 1.0416 | % |             | $ | 7,932                     |  |  | Eni US Operating Co., Inc.                                              |  | Eni Petroleum US LLC (68.00% Ownership Interest);
Mariner Energy Resources, Inc. (32.00% Ownership Interest)
|West Cameron |  |       | 291 |  |             |  | 4397 |       |  |  | 5,000           |  |  |               | 4.1662 | % |             | $ | 0                         |  |  | Apache Corporation                                                      |  | Apache Corporation (100.00% Ownership Interest)                                                             
|             |  |       |     |  |             |  |      |       |  |  |                 |  |  |               |        |   |             |   |                           |  |  |                                                                         |  |                                                                                                             
|Total        |  |       |     |  |             |  |      |       |  |  | 17,188          |  |  |               |        |   |             | $ | 373,510                   |  |  |                                                                         |  |                                                                                                             
|             |  |       |     |  |             |  |      |       |  |  |                 |  |  |               |        |   |             |   |                           |  |  |                                                                         |  |                                                                                                             



|(1) | On August 15, 2014, Black Elk Energy Offshore Operations, LLC completed a sale of certain assets, including 100% of its ownership interest in Sabine Pass Block 13, to Renaissance Offshore LLC.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | On September 30, 2013, Apache Corporation completed a sale of certain assets, including 100% of its ownership interest in West Cameron Block 165, to Fieldwood Energy LLC.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In 2015, royalty income from the sale of oil represented 64% of Tidelands total royalty income and royalty income from the sale of
natural gas represented 36% of Tidelands total royalty income. The production payments and royalty income received by Tidelands are affected by the producing capability of the wells, seasonal fluctuations in demand and changes in the market
prices for oil and natural gas.

The following table presents the approximate percentage of royalties actually received from each royalty
payor for the past three years:



|                                          |  |      |     |   |      |  |     |      |  |  |     |  
|----------------------------------------- |  | ---- | --- | - | ---- |  | --- | ---- |  |  | --- | -
|Royalty Payors (1)                        |  | 2015 |     |   | 2014 |  |     | 2013 | 
|Black Elk Energy Offshore Operations, LLC |  |      |    |   |      |  | 44  | %    |  |  | 48  | %
|Fieldwood Energy LLC/Apache Corporation   |  |      | 38  | % |      |  | 47  | %    |  |  | 52  | %
|Renaissance Offshore LLC                  |  |      | 60  | % |      |  | 9   | %    |  |  |    |  
|Eni US Operating Co., Inc. (2)            |  |      | 2   | % |      |  |    |      |  |  |    |  
|                                          |  |      |     |   |      |  |     |      |  |  |     |  
|                                          |  |      | 100 | % |      |  | 100 | %    |  |  | 100 | %
|                                          |  |      |     |   |      |  |     |      |  |  |     |  



|(1) | W&T Offshore, Inc. has paid royalties for its 75.00% working interest on Galveston Block 303. Since January 2010, Sterling Energy, Inc. and Barron
Petroleum Company, who collectively own the remaining 25.00% of the working interest,
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | have not paid royalties to Tidelands pending an agreement on which working interest owner is responsible for making payments. As of May 30, 2012, the lease on Galveston Block 303 was
terminated. Tidelands has not determined which party is responsible for these payments. Tidelands estimates that the royalties due from Sterling Energy, Inc. and Barron Petroleum Company would have totaled approximately $85,887 for 2010, 2011 and
2012. As of March 30, 2016, the Trustee is continuing to review its options in connection with the collection of the past due royalties.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Eni US Operating Co., Inc. is not a working interest owner of record but pays the royalties due to Tidelands from West Cameron Block 225. Production ceased on West Cameron Block 225 in July 2012 but went back on stream
in September 2013. A suspension of production was granted through February 2013. Tidelands has not received further updates regarding production on West Cameron Block 225. However, Tidelands recently began receiving royalty payments from Eni US
Operating Co., Inc. for West Cameron Block 225.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Tidelands derives no revenues from foreign sources and has no export sales.

Trust Functions. The Trust is administered by officers and employees of the Trustee. The Trust has no employees. See Item
10. Directors, Executive Officers and Corporate Governance.

All aspects of Tidelands operations are conducted by third
parties. These operations include the production and sale of oil and natural gas and the calculation of royalty payments to Tidelands, which are conducted by oil and natural gas companies that lease Tracts subject to Tidelands interests.
American Stock Transfer and Trust Company, LLC is the transfer agent for Tidelands and is responsible for reviewing, processing and paying distributions.

Marine Petroleum Trust (Marine) owns approximately 32.6% of the units of the Trust. Marine Petroleum Corporation, a wholly-owned
subsidiary of Marine, leases office space in Dallas, Texas to provide work space and record storage for Marine, Marine Petroleum Corporation, the Trust and Tidelands Corporation. The cost of this office facility is shared by Marine Petroleum
Corporation and Tidelands Corporation in proportion to each entitys gross income to the total income of both entities.

The ability
of Tidelands to receive revenues is entirely dependent upon its entitlement to its rights with respect to the four leases held by Chevron and its assignees in the Gulf of Mexico (as more fully described in Item 2. Properties below).

The royalty interests held by Tidelands are depleting with each barrel (bbl) of oil and thousand cubic feet (mcf) of
natural gas produced. No funds are reinvested by Tidelands; thus, these depleting assets are not being replaced.

Widely Held Fixed
Investment Trust Reporting Information.The Trustee assumes that some units of beneficial interest are held by middlemen, as such term is broadly defined in U.S. Treasury Regulations (and includes custodians, nominees, certain joint owners,
and brokers holding an interest for a customer in street name). Therefore, the Trustee considers the Trust to be a widely held fixed investment trust (WHFIT) for U.S. Federal income tax purposes. Accordingly, the Trust will provide tax
information in accordance with applicable U.S. Treasury Regulations governing the information reporting requirements of the Trust as a WHFIT. The representative of the Trust that will provide the required information is the Trustee, and the contact
information for the representative is as follows:

Southwest Bank

2911 Turtle Creek Blvd., Suite 850

Dallas, Texas 75219

Telephone
number: (855) 588-7839

Each unitholder should consult its own tax advisor for tax reporting matters.



4



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Item 1A. Risk Factors

Although various risk factors and specific cautionary statements are described elsewhere in this Annual Report on Form 10-K, the following
is a summary of the principal risks associated with the Trust and an investment in units of the Trust.

Tidelands is unable to acquire royalty
interests in any more leases.

Chevron and its assignees are no longer obligated to assign any interest to Tidelands out of any lease
that they acquire on any of the Tracts. In addition, Tidelands is not permitted to carry on any business, including making investments in additional oil and natural gas interests. Tidelands will continue to be entitled to receive payments on four of
the leases acquired by Chevron or its assignees prior to the Acquisition Expiration Date, so long as the leases exist and such leases contain active wells. Once the leases terminate or expire, any overriding royalties payable to Tidelands terminate
and Tidelands cannot acquire any additional or replacement royalty interests. For example, one of the original five leases acquired by Chevron or its assignees terminated in May 2012.

Royalty interests are depleting assets and may deplete faster than expected or in their entirety.

The net proceeds payable to Tidelands are derived from the sale of depleting assets. Accordingly, the portion of the distributions to
unitholders that are attributable to depletion may be considered a return of capital as opposed to a return on investment. Distributions that are considered a return of capital will ultimately diminish the depletion tax benefits available to
unitholders, which could reduce the market value of the units over time.

The reduction in proved reserve quantities is a common measure
of depletion. Future maintenance and development projects in the Royalty Area will likely affect the quantity of proved reserves. The timing and size of these projects will depend on the market prices of oil and natural gas. If operators of the
Royalty Area do not implement additional maintenance and development projects, the future rate of production decline of proved reserves may be higher than the rate currently experienced by Tidelands. Eventually, the properties in the Royalty Area
will stop producing in commercial quantities and Tidelands leases in the Royalty Area will terminate or expire, and Tidelands will no longer receive any distributions of net proceeds or overriding royalty interest payments.

Oil and natural gas prices are volatile and fluctuate due to a number of factors, and lower prices will reduce royalty payments to Tidelands and
distributions to its unitholders.

Tidelands quarterly distributions are highly dependent upon the prices realized from the sale
of oil and natural gas. A significant downward movement in the prices for oil and natural gas could have a material adverse effect on Tidelands distributable income, which could decrease the distributions to unitholders and the market price
for the units. Historically, prices have been volatile and are likely to continue to be volatile in the future due to factors beyond Tidelands control. These factors include, but are not limited to:



| |  |  | political conditions worldwide, in particular political disruption, terrorist activities, war or other armed conflicts in oil producing regions, especially in the Middle East;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | worldwide economic conditions;
| | - |  | ------------------------------



| |  |  | weather conditions;
| | - |  | -------------------



| |  |  | the supply and price of domestic and foreign oil and 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.
| | - |  | -----------------------------------------------------

Moreover, government regulations, such
as regulation of natural gas transportation and price controls, can affect oil and natural gas product prices in the long term.



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Lower prices may reduce the amount of oil and natural gas that is economical to produce and
reduce distributable income available to Tidelands. The volatility of oil and gas prices reduces the predictability of future cash distributions to unitholders. Substantially all of the oil and natural gas produced from the Royalty Area is being
sold under short-term or multi-month contracts at market clearing prices or on the spot market.

The market price for the units may not reflect the
value of the royalty interests held by Tidelands.

The public trading price for the units tends to be tied to the recent and expected
levels of cash distributions on the units. The amounts available for distribution by Tidelands vary in response to numerous factors outside of Tidelands control, including prevailing prices for oil and natural gas produced from properties in
the Royalty Area. The market price of the units is not necessarily indicative of the value that Tidelands would realize if it sold its interest in the properties in the Royalty Area to a third party and distributed the net proceeds to its
unitholders. In addition, the market price of the units is not necessarily reflective of the fact that Tidelands assets are depleting assets and a portion of each cash distribution paid on the units should be considered by investors as a
return of capital, with the remainder being considered as a return on investment. There is no guarantee that distributions made to a unitholder over the life of these depleting assets will equal or exceed the purchase price paid by the unitholder
for the unit.

In addition, the public stock markets have traditionally experienced price and trading volume volatility. This volatility
has had a significant effect on the market prices of securities issued by many companies for reasons that may or may not be related to operating performance. If the public stock markets continue to experience price and trading volume volatility in
the future, the market price of the units could be adversely affected.

Our units have been thinly traded and an active trading market for our units
may not develop.

The trading volume of our units has historically been low, partially because our units are only traded on the OTCQB.
In addition, our public float has been further limited because approximately 32.6% of our units were owned by Marine as of March 30, 2016. As a result, sales of small amounts of the units in the public market could cause the price of the units
to fluctuate greatly, including in a materially adverse manner. In addition, a more active trading market for our units may not develop, or if it does develop, may not continue, and a unitholder may find it difficult to dispose of, or to obtain
accurate quotations as to the market value of, our units.

Operating risks for the working interest owners interests in the Royalty Area can
adversely affect distributions.

The occurrence of drilling, production or transportation accidents and other natural disasters in the
Royalty Area can reduce distributions. These occurrences include blowouts, cratering, explosions, environmental and hurricane damage that may result in personal injuries, property damage, damage to productive formations or equipment and
environmental damages. Any of these occurrences could have a material adverse effect on the amount of our distributions or the market value of the units.

Failure to collect royalty payments from working interest owners could adversely affect Tidelands distributions to its unitholders.

A significant portion of Tidelands royalties are attributable to a limited number of working interest owners. During 2015, Renaissance
Offshore LLC and Apache Corporation/Fieldwood Energy LLC accounted for approximately 60% and 38% of the royalty payments to Tidelands, respectively. Tidelands does not require working interest owners to pledge collateral or otherwise post security
for royalty payments. Tidelands has encountered and may in the future encounter collection issues with one or more of the working interest owners at any time, which could result in Tidelands not receiving payment for some or all of its
royalty interests. Any reduction in royalty payments would reduce Tidelands distributable income to unitholders. For example, since January 2010, Sterling Energy, Inc. and Barron Petroleum Company, who collectively own 25.00% of the
working interest on Galveston Block 303, have not paid royalties to Tidelands pending an agreement on which working interest owner is responsible for making the payments. Tidelands estimates that the royalties due from Sterling Energy, Inc. and
Barron Petroleum Company would have totaled approximately $85,887 for 2010, 2011 and 2012. As of March 30, 2016, the Trustee is continuing to review its options in connection with the collection of the past due royalties.



6



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The owner of any properties in the Royalty Area may transfer any of the properties in the Royalty Area to
another unrelated third party, which could reduce the amount of royalty payments that are received.

The working interest owners may
at any time transfer all or part of the properties in the Royalty Area to another unrelated third party. Unitholders are not entitled to vote on any transfer, and Tidelands will not receive any proceeds of any such transfer. Following any transfer,
the Royalty Area will continue to be subject to Tidelands royalty interest, but the net proceeds from the transferred property would be calculated separately and paid by the transferee. The transferee would be responsible for all of the
obligations relating to calculating, reporting and paying to Tidelands its royalty interest on the transferred portion of the Royalty Area, and the transferor of the transferred property in the Royalty Area would have no continuing obligation to
Tidelands for the property. Any such transferee may not be as financially sound as the current working interest owner.

The owner of any properties in
the Royalty Area may abandon any property, terminating the related royalty interest Tidelands may hold.

The current working interest
owners or any transferee may abandon any well or property if it believes that the well or property can no longer produce in commercially economic quantities or for any other reason. This would terminate Tidelands royalty interest relating to
the abandoned well or property.

The Trustee, Tidelands and the Trusts unitholders do not control the operation or development of the properties
in the Royalty Area and have little influence over operation or development.

The Trustee, Tidelands and the Trusts unitholders
have little, if any, influence or control over the operation or future development of the underlying properties in the Royalty Area. The properties in the Royalty Area are owned by independent working interest owners. The working interest owners
manage the underlying properties and handle the receipt and payment of funds relating to the Royalty Area and payments to Tidelands for its royalty interests. The current working interest owners are under no obligation to continue operating the
properties. The failure of a working interest owner to conduct its operations, discharge its obligations, cooperate with regulatory agencies or comply with laws, rules and regulations in a proper manner could have an adverse effect on net proceeds
payable to Tidelands. The Trustee, Tidelands and the Trusts unitholders do not have the right to replace an operator.

Important reserve and
other information with respect to the particular leases subject to Tidelands royalty interest is unreasonably difficult to obtain.

The leasehold working interests that are subject to the rights held by Tidelands were owned in whole or in part by Chevron and have been
assigned to other oil and natural gas exploration and production companies. Certain information with respect to the particular leases subject to Tidelands interests, including, but not limited to, (i) reserves, (ii) availability of
oil and natural gas, (iii) average production cost (lifting cost) per unit, (iv) undeveloped acreage and (v) net wells and net acres, lies solely within the knowledge of these working interest owners. Tidelands does not have access to
engineering data regarding these leaseholds and believes such information would have been compiled principally by or for the working interest owners of these leaseholds and such information is unreasonably difficult for Tidelands to obtain.

Terrorism and continued geopolitical hostilities could adversely affect Tidelands distributions to its unitholders or the market price of its units.

Terrorist attacks and the threat of terrorist attacks, whether domestic or foreign, as well as military or other actions taken in
response to such attacks or threats, could cause instability in the global financial, oil and natural gas markets. Terrorism and other geopolitical hostilities could adversely affect the Trusts distributions to its unitholders or the market
price of its units in unpredictable ways, including through the disruption of oil and natural gas supplies and markets, increased volatility in oil and natural gas prices, or the possibility that the infrastructure on which the operators of the
underlying properties rely could be a direct target or an indirect casualty of an act of terror.



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Unitholders have limited voting rights.

Voting rights as a unitholder are more limited than those of stockholders of most public corporations. For example, there is no requirement
for annual meetings of unitholders or for an annual or other periodic re-election of the Trustee. Unlike corporations, which are generally governed by boards of directors that are elected by their equity holders, the Trust is administered by a
corporate trustee in accordance with the Indenture and other organizational documents. The Trustee has extremely limited discretion in its administration of the Trust.

The limited liability of the unitholders is uncertain.

The unitholders are not protected from the liabilities of the Trust to the same extent that a shareholder would be protected from a
corporations liabilities. The structure of the Trust as a trust does not include the interposition of a limited liability entity such as a corporation or limited partnership, which would provide further limited liability protection to
unitholders. While the Trust is liable for any excess liabilities incurred if the Trustee fails to ensure that such liabilities are to be satisfied only out of the Trusts assets, under the laws of the State of Texas, which are unsettled on
this point, a unitholder may be jointly and severally liable for any liability of the Trust if (i) the satisfaction of such liabilities was not contractually limited to the assets of the Trust and (ii) the assets of the Trust and the
Trustee are not adequate to satisfy such liability. As a result, unitholders may be exposed to personal liability.

Tidelands royalty interest
can be sold and the Trust can be terminated.

The Trust may be terminated and the Trustee may sell Tidelands royalty interests
if holders of 80% or more of the units of beneficial interest of the Trust approve the sale and vote to terminate the Trust. Following any such termination and liquidation, the net proceeds of any sale would be distributed to the unitholders and the
unitholders would receive no further distributions from the Trust. Any such sale may not be on terms acceptable or favorable to all unitholders.

The
operators of the oil and natural gas leases are subject to extensive governmental regulation.

Oil and natural gas operators have
been, and in the future will be, affected by Federal, state and local laws and regulations and other political developments, such as price or gathering rate controls, drilling regulations and environmental protection regulations, including the
regulation of hydraulic fracturing. Although Tidelands is unable to predict changes to existing laws and regulations, such changes could significantly impact royalty interests.

Cash held by the Trustee is not insured by the Federal Deposit Insurance Corporation.

Currently, cash held by Tidelands reserved for the payment of accrued liabilities and estimated future expenses and distributions to
unitholders is typically held in cash deposits, U.S. Treasury and agency bonds and money market accounts. Tidelands places such reserve cash with financial institutions that Tidelands considers creditworthy and limits the amount of credit exposure
from any one financial institution. However, none of these accounts are insured by the Federal Deposit Insurance Corporation. In the event that any such financial institution becomes insolvent, Tidelands may be unable to recover any or all such cash
from the insolvent financial institution. Any loss of such cash may have a material adverse effect on Tidelands cash balances and any distributions to unitholders.

Financial information of Tidelands is not prepared in accordance with generally accepted accounting principles in the United States.

The financial statements of Tidelands are prepared on a modified cash basis of accounting, which is a comprehensive basis of accounting that
differs from generally accepted accounting principles in the United States (GAAP). Although this basis of accounting is permitted for royalty trusts by the U.S. Securities and Exchange Commission (the SEC), the financial
statements of Tidelands differ from financial statements prepared in accordance with GAAP because royalty income is recognized in the month it is received rather than in the month of production, expenses are recorded in the month paid rather than in
the month incurred and reserves may be established for contingencies that would not be recorded under GAAP.



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If Tidelands becomes subject to the Texas franchise tax, the Trustee may have to withhold amounts from future
distributions to pay the tax liability.

In May 2006, the State of Texas enacted legislation, as amended, to implement a franchise or
margin tax. Certain entities that were previously exempt from the franchise tax, including many trusts, are now subject to the tax. Trusts, however, other than business trusts (as defined in U.S. Treasury Regulation section
301.7701-4(b)), that meet certain statutory requirements are exempt from the franchise tax as passive entities.

The Trustee
does not expect that the Trust will be required to pay any amounts under the Texas state franchise tax for the 2015 tax year, based on the Trustees belief that the Trust is exempt from the franchise tax as a passive entity (i.e., the
Trust is not a business trust, it receives at least 90% of its Federal gross income from certain passive sources, and no more than 10% of its income is derived from an active trade or business). If it is subsequently determined that the Trust is not
exempt from the franchise tax, the Trust will be required to deduct and withhold from future distributions the amount required to satisfy and pay the Trusts franchise tax liability for years for which the applicable statute of limitations has
not yet expired. In addition, the Trust would be required to timely pay franchise tax liability due with respect to current and future years.

If the Trust is exempt from the Texas state franchise tax as a passive entity, each unitholder that is subject to the Texas franchise tax as a
taxable entity under the Texas Tax Code should generally include its share of the Trusts revenue in its franchise tax computation. The Texas franchise tax does not apply to natural persons. Each unitholder is urged to consult its own tax
advisor regarding its possible Texas state franchise tax liability.



|Item 1B. | Unresolved Staff Comments
|-------- | -------------------------

Not applicable.



|Item 2. | Properties
|------- | ----------

General. Tidelands is not engaged in oil and
natural gas exploration or production operations and its only industry segment or purpose is the administration and collection of royalties. Tidelands income is based upon the oil and natural gas operations of third parties. Tidelands income
is derived from contracts that provide for payments in the nature of overriding royalties made to Tidelands based on oil and natural gas sales from certain leases in the Gulf of Mexico. Tidelands does not own or directly lease any physical
properties.

Reserves. As indicated above, Tidelands is not engaged in the exploration or production of oil or natural gas, and its
income is derived from overriding royalty payments that are carved out of working interests in oil and natural gas leases in the Gulf of Mexico pursuant to the 1951 Contract. Tidelands does not have the engineering data necessary to make an estimate
of the proved oil and natural gas reserves attributable to such working interests (nor the present value of future net cash flows from such reserves), and is not entitled to receive such data from the owners of the working interests from which
Tidelands interests are derived. See also Difficulty in Obtaining Certain Data.

Since Tidelands does not
have access to this reserve information, Tidelands is unable to compute the standardized measure of discounted future net cash flows attributable to such working interests.

Tidelands did not file any reports during the year ended December 31, 2015 with any U.S. Federal authority or agency with respect to oil
and natural gas reserves. Due to the nature of Tidelands business, it does not have any delivery commitments.



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##### Table of Contents

Production. Information regarding the net quantities of oil and natural gas produced with
respect to Tidelands overriding royalty interests for each of the last three fiscal years, as well as the average sales price per bbl of oil and mcf of natural gas produced upon which payments to Tidelands are based, is set forth below in the
following table:



|                                                          |  |                         |        |  |      |   |        |      |  |   |        | 
|--------------------------------------------------------- |  | ----------------------- | ------ |  | ---- | - | ------ | ---- |  | - | ------ | 
|                                                          |  | Year Ended December 31, |       
|                                                          |  | 2015                    |        |  | 2014 |   |        | 2013 | 
|Net quantities sold:                                      |  |                         |        |  |      |   |        |      |  |   |        | 
|Oil (bbls)                                                |  |                         | 4,460  |  |      |   | 4,537  |      |  |   | 3,577  | 
|Natural gas (mcf)                                         |  |                         | 43,410 |  |      |   | 53,152 |      |  |   | 68,935 | 
|Average sales price for royalty oil and natural gas sold: |  |                         |        |  |      |   |        |      |  |   |        | 
|Oil (per bbl) (1)                                         |  | $                       | 53.47  |  |      | $ | 97.75  |      |  | $ | 107.71 | 
|Natural gas (per mcf) (1)                                 |  | $                       | 3.11   |  |      | $ | 5.12   |      |  | $ | 4.03   | 



|(1) | The average sales price is calculated from data provided by the operators of the oil and natural gas leases for which Tidelands has an overriding royalty interest.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------

Information about average production cost (lifting cost) per unit of production has been omitted due to its unavailability and inapplicability
to Tidelands. For more recent information regarding average oil and natural gas sales prices, see Item 7. Trustees Discussion and Analysis of Financial Condition and Results of Operations.

Interests in Properties. Tidelands properties consist of overriding royalty interests in four oil and natural gas leases covering
17,188 gross acres located in the Gulf of Mexico in the Sabine Pass and West Cameron areas. See also Present Activities.

Productive Properties.Information regarding gross productive oil and natural gas wells and gross leased acres in which Tidelands owns
interests as of December 31, 2015 is set forth in the table below:



|                        |  |  |        | 
|----------------------- |  |  | ------ | 
|Gross Productive Wells: |  |  |        | 
|Oil                     |  |  | 3      | 
|Natural Gas             |  |  | 4      | 
|                        |  |  |        | 
|Total Wells             |  |  | 7      | 
|                        |  |  |        | 
|Gross Leased Acres:     |  |  |        | 
|Productive              |  |  | 17,188 | 
|Non-Productive          |  |  |       | 
|                        |  |  |        | 
|Total Leased Acres      |  |  | 17,188 | 
|                        |  |  |        | 

Information regarding net wells or acres is not included since Tidelands does not own any working interests in
oil and natural gas leases.

Present Activities. Tidelands currently receives royalties from oil and natural gas sold from four
leases in the Royalty Area.

Tidelands is not obligated to provide any fixed and determinable quantities of oil or natural gas in the
future under any existing contracts or agreements.

Galveston Block 303 Field: The records of the Bureau of Ocean Energy
Management, a division of the U.S. government (the BOEM), show that production from the wells on this field ceased in November 2011. There were no drilling or work over operations on the lease in 2011, and on February 17, 2012, the
BOEM approved the suspension of production on this field due to lack of production. On May 30, 2012, the lease was terminated due to the lack of production from the wells on the lease and Tidelands will no longer receive royalty payments from
this lease. Since January 2010, Sterling Energy, Inc. and Barron Petroleum Company, who collectively own 25.00% of the working interest (W&T Offshore, Inc. owns the remaining 75.00% working interest on Galveston Block 303) have not paid
royalties to Tidelands pending an agreement on which working interest owner is responsible for making payments. Tidelands has not determined which party is responsible for these payments. Tidelands estimates that the royalties due from Sterling
Energy, Inc. and Barron Petroleum Company would have totaled approximately $85,887 for 2010, 2011 and 2012. As of March 30, 2016, the Trustee is continuing to review its options in connection with the collection of the past due royalties.



10



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##### Table of Contents

Sabine Pass Block 13: The records of the BOEM show that there were four active wells in
this field during the year ended December 31, 2015. Three of the wells are oil wells and one of the wells is a natural gas well.

West Cameron Blocks 165 and 291: These two blocks are in the West Cameron Block 165 field. This field has two leases covering a total
of 10,000 gross acres. The field has three active natural gas wells and no active oil wells.

West Cameron Block 225: Production
had ceased on West Cameron Block 225 in July 2012, but the wells went back on stream in September 2013. Delivery quantities are subject to the production from the wells and seasonal demand.

Difficulty in Obtaining Certain Data. Tidelands only activities are the collection and distribution of revenues from overriding
royalties on certain oil and natural gas leases in the Gulf of Mexico, pursuant to the 1951 Contract. The leasehold working interests that are subject to the rights held by Tidelands were owned in whole or in part by Chevron and have been assigned
to other oil and natural gas exploration and production companies. Certain information with respect to the particular leases subject to Tidelands interests, including, but not limited to, (i) reserves, (ii) the availability of oil
and natural gas, (iii) the average production cost (lifting cost) per unit, (iv) undeveloped acreage and (v) net wells and net acres, lies solely within the knowledge of these working interest owners. Tidelands does not have access to
engineering data regarding these leaseholds and believes that such information would have been compiled principally by or for the working interest owners of these leaseholds and that such information is unreasonably difficult for Tidelands to
obtain. As a result, the Trustee believes that unreasonable effort and expense would be involved in seeking to obtain all of the information required under Item 102 and Subpart 1200 of Regulation S-K.



|Item 3. | Legal Proceedings
|------- | -----------------

Neither the Trust nor Tidelands Corporation,
nor any of their respective properties, is a party to or subject to any material pending legal proceedings as of the date of the filing of this Annual Report on Form 10-K.



|Item 4. | Mine Safety Disclosures
|------- | -----------------------

Not applicable.

Part II

Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The Trust is authorized to issue 1,386,525 units of beneficial interest. As of March 30, 2016, 1,386,375 units were held by 208
unitholders of record. The remaining 150 units are reserved to be issued to specific parties if and when they decide to transfer their rights under the 1951 Contract to the Trust. There were no changes in the number of outstanding units of
beneficial interest during 2015.



11



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##### Table of Contents

The units of beneficial interest in the Trust trade on the OTCQB and are listed under the symbol
TIRTZ. There is limited trading in the Trusts units of beneficial interest. The following table presents information obtained from public Internet sources for 2015 and 2014 as to the high and low bid prices and includes
distributions to unitholders, by quarter, for the past two years:



|                        |  |                   |      |  |                         |   |      |  |  |   |      | 
|----------------------- |  | ----------------- | ---- |  | ----------------------- | - | ---- |  |  | - | ---- | 
|                        |  | Bid Quotation (1) |      |  | Distributions(Per Unit) |  
|Year Ended December 31, |  | High              |      |  | Low                     |   |     
|2014                    |  |                   |      |  |                         |   |      |  |  |   |      | 
|First quarter           |  | $                 | 3.59 |  |                         | $ | 3.00 |  |  | $ | 0.10 | 
|Second quarter          |  |                   | 3.23 |  |                         |   | 2.60 |  |  |   | 0.06 | 
|Third quarter           |  |                   | 2.75 |  |                         |   | 1.84 |  |  |   | 0.07 | 
|Fourth quarter          |  |                   | 1.95 |  |                         |   | 1.31 |  |  |   | 0.13 | 
|                        |  |                   |     
|2015                    |  |                   |      |  |                         |   |      |  |  |   |      | 
|First quarter           |  | $                 | 2.20 |  |                         | $ | 1.20 |  |  | $ | 0.12 | 
|Second quarter          |  |                   | 2.30 |  |                         |   | 1.25 |  |  |   | 0.02 | 
|Third quarter           |  |                   | 1.55 |  |                         |   | 0.99 |  |  |   | 0.05 | 
|Fourth quarter          |  |                   | 1.32 |  |                         |   | 1.00 |  |  |   | 0.04 | 



|(1) | Such over-the-counter market quotations reflect interdealer prices without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Trust must distribute to its unitholders all cash accumulated each quarter, less an amount reserved for accrued liabilities and estimated
future expenses. The amount reserved varies from quarter to quarter and amounted to $16,500 for the distribution paid to holders of record on December 31, 2015. Such distributions have been made since the third quarter of 1977 and will continue
to be made so long as the income from oil and natural gas royalties exceeds administrative costs.

Distributions primarily fluctuate from
quarter to quarter due to changes in oil and natural gas prices and production quantities. Distributions are determined by the cash available to the Trust on or before ten days prior to the record date provided in the Indenture.

Tidelands does not maintain any equity compensation plans.

Tidelands did not repurchase any units of beneficial interest during the fourth quarter of 2015.

While Tidelands Annual Report on Form 10-K (excluding exhibits) for the year ended December 31, 2015 is distributed to unitholders,
a copy of the Annual Report on Form 10-K (excluding exhibits) is available without charge to interested parties. There will be copying and mailing charges for copies of any exhibits that are requested. Written requests should be directed to
Mr. Ron E. Hooper, Southwest Bank, 2911 Turtle Creek Blvd., Suite 850, Dallas, Texas, 75219.



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##### Table of Contents

|Item 6. | Selected Financial Data
|------- | -----------------------

The following table summarizes
selected financial information that has been derived from Tidelands audited consolidated financial statements. You should read the information set forth below in conjunction with Item 7. Trustees Discussion and Analysis of
Financial Condition and Results of Operations and the consolidated financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K.



|                                                                 |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|---------------------------------------------------------------- |  | --------------------------------------- | ---- |  | ---- | - | ---- | ---- |  | - | ---- |  |  | ---- | ---- | - |  | - | ----- | 
|                                                                 |  | Year Ended December 31,                 |     
|                                                                 |  | 2015                                    |      |  | 2014 |   |      | 2013 |  |   | 2012 |  |  | 2011 |     
|                                                                 |  | (In Thousands, Except Per Unit Amounts) |     
|Consolidated Statement of Distributable Income Selected Data:    |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|Income  Oil and natural gas royalties                           |  | $                                       | 374  |  |      | $ | 717  |      |  | $ | 663  |  |  | $    | 969  |   |  | $ | 1,335 | 
|                                                                 |  |                                         |      |  |     
|Expense  General and administrative expenses                    |  | $                                       | 138  |  |      | $ | 216  |      |  | $ | 189  |  |  | $    | 182  |   |  | $ | 211   | 
|Expense  Federal income taxes (refund) of subsidiary            |  | $                                       |     |  |      | $ |     |      |  | $ |     |  |  | $    | (7   | ) |  | $ |      | 
|                                                                 |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|                                                                 |  |                                         |      |  |     
|Distributable income                                             |  | $                                       | 236  |  |      | $ | 501  |      |  | $ | 474  |  |  | $    | 794  |   |  | $ | 1,124 | 
|                                                                 |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|Distributable income per unit                                    |  | $                                       | 0.17 |  |      | $ | 0.36 |      |  | $ | 0.34 |  |  | $    | 0.57 |   |  | $ | 0.81  | 
|                                                                 |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|Distributions to unitholders                                     |  | $                                       | 321  |  |      | $ | 493  |      |  | $ | 573  |  |  | $    | 777  |   |  | $ | 1,246 | 
|Distributions per unit                                           |  | $                                       | 0.23 |  |      | $ | 0.36 |      |  | $ | 0.41 |  |  | $    | 0.56 |   |  | $ | 0.90  | 
|                                                                 |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|                                                                 |  |                                         |      |  |     
|Statement of Assets, Liabilities and Trust Corpus Selected Data: |  |                                         |      |  |      |   |      |      |  |   |      |  |  |      |      |   |  |   |       | 
|Total assets                                                     |  | $                                       | 580  |  |      | $ | 778  |      |  | $ | 754  |  |  | $    | 874  |   |  | $ | 963   | 
|Trust corpus                                                     |  | $                                       | 525  |  |      | $ | 609  |      |  | $ | 601  |  |  | $    | 700  |   |  | $ | 683   | 



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|Item 7. | Trustees Discussion and Analysis of Financial Condition and Results of Operations
|------- | ----------------------------------------------------------------------------------

Critical Accounting Policies. The financial statements of Tidelands are prepared on the modified cash basis method and are not intended
to present financial position and results of operations in conformity with GAAP. Under the modified cash basis method:



| |  |  | Royalty income is recognized when received by Tidelands.
| | - |  | --------------------------------------------------------



| |  |  | Tidelands expenses (which include accounting, legal, and other professional fees, trustees fees and out-of-pocket expenses) are recorded on an actual paid basis. Reserves for liabilities that are contingent
or uncertain in amount may also be established if considered necessary.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Distributions to unitholders are recognized when declared by the Trustee of the Trust.
| | - |  | --------------------------------------------------------------------------------------

The
financial statements of Tidelands differ from financial statements prepared in conformity with GAAP because of the following:



| |  |  | Royalty income is recognized in the month received rather than in the month of production.
| | - |  | ------------------------------------------------------------------------------------------



| |  |  | Reserves may be established for contingencies that would not be recorded under GAAP.
| | - |  | ------------------------------------------------------------------------------------



| |  |  | Expenses are recorded in the month paid rather than in the month incurred.
| | - |  | --------------------------------------------------------------------------

This comprehensive
basis of accounting corresponds to the accounting principles permitted for royalty trusts by the SEC, as specified by Staff Accounting Bulletin Topic 12:E, Financial Statements of Royalty Trusts.

The preparation of financial statements in conformity with the modified cash basis method of accounting requires the Trustee to make various
estimates and assumptions that affect the reported amount of liabilities at the date of the financial statements and the reported amount of expenses during the reporting period. Actual amounts may differ from such estimates.

On January 9, 2014, U.S. Trust, Bank of America Private Wealth Management gave notice to Tidelands unitholders that it would be
resigning as Trustee of the Trust, subject to, among other conditions, the appointment of Southwest Bank as successor Trustee. At a special meeting of Tidelands unitholders on May 22, 2014, Southwest Bank was appointed as successor
Trustee, and such appointment became effective on May 30, 2014.

Results of Operations. Tidelands revenues are derived
from the oil and natural gas production activities of unrelated parties. Tidelands revenues and distributions fluctuate from period to period based upon factors beyond Tidelands control, including, without limitation, the number of
leases subject to Tidelands interests, the number of productive wells drilled on leases subject to Tidelands interests, the level of production over time from such wells and the prices at which the oil and natural gas from such wells are
sold.

Tidelands results of operations are significantly impacted by oil and natural gas commodity prices and the quantity of oil
and natural gas production. Oil and natural gas prices have historically experienced significant volatility. Tidelands is not permitted to manage its commodity price risk through the use of fixed price contracts or financial derivatives.

Tidelands income consists primarily of oil and natural gas royalties and is based on the value at the well of Tidelands percentage
interest in oil and natural gas sold without reduction for any of the production expenses. Value at the well for oil means the purchasers selling price at its receiving point onshore, less the cost of transportation from the offshore lease to
the onshore receiving point. Value at the well for natural gas means the selling price less the cost of compression, dehydration and transportation from the lease to the delivery point of the pipeline transporting the product to market. In general,
value at the well is determined on the basis of the selling price of oil, natural gas and other minerals produced, saved and sold, or at wellhead prices determined by industry standards, where the selling price does not reflect value at the well. In
the event an agreement is not arms-length in nature, the value is based upon current market prices.



14



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##### Table of Contents

Summary Review.In general, Tidelands receives royalties two months after oil production
and three months after natural gas production. The distribution to be paid in April 2016 will be based upon royalty receipts received in December 2015 and January and February 2016, from natural gas production in September, October and November 2015
and oil production in October, November and December 2015. The distribution to be paid in July 2016 will be based on natural gas production in December 2015 and oil and natural gas production in January and February and oil production in March 2016.

Tidelands distributable income in 2015 was $236,070 or $0.17 per unit as compared to $501,166 or $0.36 per unit in 2014 and
$473,760 or $0.34 per unit in 2013.

Oil and natural gas prices fluctuated during 2015 and 2014, with average oil and natural gas prices
realized in 2015 generally below the prices realized in 2014. Recently, average prices for oil and natural gas have decreased from the average prices realized in 2015. For example, in March 2016, the average price quoted for oil delivered onshore in
Louisiana had decreased to $39.46 per barrel from $41.60 per barrel in September 2015. In March 2016, natural gas prices were down to $1.81 per mcf from $2.59 per mcf in September 2015.

Year Ended December 31, 2015 Compared to Years Ended December 31, 2014 and 2013.The following table and related discussion
and analysis shows the royalty income, the net quantities sold and the average price received for oil and natural gas during 2015, 2014 and 2013.



|                                        |  |                             |         |  |      |   |         |      |  |   |         | 
|--------------------------------------- |  | --------------------------- | ------- |  | ---- | - | ------- | ---- |  | - | ------- | 
|                                        |  | For Year Ended December 31, |        
|                                        |  | 2015                        |         |  | 2014 |   |         | 2013 | 
|Income:                                 |  |                             |         |  |      |   |         |      |  |   |         | 
|Oil royalties                           |  | $                           | 238,468 |  |      | $ | 443,492 |      |  | $ | 385,279 | 
|Natural gas royalties (net of expenses) |  |                             | 135,042 |  |      |   | 273,430 |      |  |   | 277,710 | 
|                                        |  |                             |         |  |      |   |         |      |  |   |         | 
|                                        |  | $                           | 373,510 |  |      | $ | 716,922 |      |  | $ | 662,989 | 
|Net production quantities:              |  |                             |         |  |      |   |         |      |  |   |         | 
|Oil (bbls)                              |  |                             | 4,460   |  |      |   | 4,537   |      |  |   | 3,577   | 
|Natural gas (mcf)                       |  |                             | 43,410  |  |      |   | 53,152  |      |  |   | 68,935  | 
|                                        |  |                             |        
|Average net prices received:            |  |                             |         |  |      |   |         |      |  |   |         | 
|Oil (per bbl)(1)                        |  | $                           | 53.47   |  |      | $ | 97.75   |      |  | $ | 107.71  | 
|Natural gas (per mcf)(1)                |  | $                           | 3.11    |  |      | $ | 5.12    |      |  | $ | 4.03    | 



|(1) | These amounts are net of the transportation costs from offshore leases to onshore receiving points.
|--- | ---------------------------------------------------------------------------------------------------

Revenue from oil royalties amounted to $238,468 in 2015, a decrease from the $443,492 realized in 2014. The average price realized per bbl of
oil decreased to $53.47 in 2015 from the $97.75 realized in 2014. In 2015, oil production decreased to 4,460 bbls from the 4,537 bbls produced in 2014.

Revenue from oil royalties amounted to $443,492 in 2014, an increase from the $385,729 realized in 2013. The average price realized per bbl of
oil decreased to $97.75 in 2014 from the $107.71 realized in 2013. In 2014, oil production increased to 4,537 bbls from the 3,577 bbls produced in 2013.

Revenue from natural gas royalties, net of expenses, amounted to $135,042 in 2015, a decrease from the $273,430 realized in 2014. In 2015, the
average price per mcf of natural gas decreased to $3.11 from the $5.12 realized in 2014, while natural gas production decreased to 43,410 mcf from the 53,152 mcf produced in 2014.

Revenue from natural gas royalties, net of expenses, amounted to $273,430 in 2014, a decrease from the $277,710 realized in 2013. In 2014, the
average price per mcf of natural gas increased to $5.12 from the $4.03 realized in 2013, while natural gas production decreased to 53,152 mcf from the 68,935 mcf produced in 2013. Royalties received from Sabine Pass Block 13 were up 12% in 2014 as
compared to those royalties received in 2013.



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General and administrative expenses were $137,509 in 2015, a decrease from $215,845 for 2014.
This decrease is primarily due to decreased costs associated with professional fees associated with the transition resulting from Southwest Banks appointment as Trustee and costs incurred for the transition in the prior year, which were one
time transition costs that are no longer being incurred. General and administrative expenses were $215,845 in 2014, an increase from $189,245 for 2013. This increase was primarily due to increased costs associated with the transition resulting from
Southwest Banks appointment as Trustee.

Capital Resources and Liquidity. The Trusts Indenture (and the charter and
by-laws of Tidelands Corporation) expressly prohibits the operation of any kind of trade or business. Due to the limited purpose of the Trust as stated in the Trusts Indenture, there is no requirement for capital. The Trusts only
obligation is to distribute all cash in the Trust excluding cash retained by its subsidiary, less an amount reserved for the payment of accrued liabilities and estimate future expenses.

As an administrator of oil and natural gas royalty properties, Tidelands collects income monthly, pays expenses of administration and
disburses all distributable income collected to its unitholders each quarter. Because all of Tidelands revenues are invested in liquid funds pending distribution, Tidelands does not experience liquidity problems.

The Trusts oil and natural gas properties are depleting assets and are not being replaced due to the prohibition against these
investments. These restrictions, along with other factors, allow the Trust to be treated as a non-taxable grantor trust for U.S. Federal income tax purposes. Accordingly, all of Tidelands income and deductions, should flow through to its
unitholders on a proportionate basis. The Trust is not a taxable entity. Tidelands Corporation will owe state and U.S. Federal income taxes with respect to its income after deducting statutory depletion. Tidelands Corporations income
specifically excludes 95% of oil and natural gas royalties collected by Tidelands Corporation, which are retained by and delivered to the Trust in respect of the Trusts net profits interest.

The Trust does not currently have any long term contractual obligations, other than the obligation to make distributions to unitholders
pursuant to the Indenture. In addition, the Trust does not maintain any off-balance sheet arrangements within the meaning of Item 303 of Regulation S-K promulgated by the SEC.

Forward-Looking Statements. The statements discussed in this Annual Report on Form 10-K regarding Tidelands future financial
performance and results of operations, and other statements that are not historical facts, are forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of
1934, as amended (the Exchange Act). Tidelands uses the words may, expect, anticipate, estimate, believe, continue, intend, plan,
budget, or other similar words to identify forward-looking statements. All forward-looking statements speak only as of the date on which they are made. You should read statements that contain these words carefully because they discuss
future expectations, contain projections of Tidelands financial condition, and/or state other forward-looking information. Actual results may differ from expected results because of factors, risks and uncertainties including, but
not limited to, the following: reductions in price or demand for oil and natural gas, which might then lead to decreased production; reductions in production due to the depletion of existing wells or disruptions in service, which may be caused by
storm damage to production facilities, blowouts or other production accidents, or geological changes such as cratering of productive formations; changes in regulations; and the expiration or release of leases subject to Tidelands interests.
Events may occur in the future that Tidelands is unable to accurately predict, or over which it has no control. If one or more of these uncertainties as well as other risks of which we are not aware materialize, or if underlying assumptions prove
incorrect, actual outcomes may vary materially from those contained in the forward-looking statements included in this Annual Report on Form 10-K.



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Website

Tidelands has an Internet website and has made available its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current
Reports on Form 8-K, and amendments to such reports, filed or furnished pursuant to Section 13(a) or 15(d) of Exchange Act at www.tirtz-tidelands.com. Each of these reports will be posted on this website as soon as reasonably
practicable after such report is electronically filed with or furnished to the SEC.



|Item 7A. | Quantitative and Qualitative Disclosures About Market Risk
|-------- | ----------------------------------------------------------

As
described elsewhere herein, Tidelands only function is to collect overriding royalties from leases operated by others and distribute those royalties to its unitholders after paying the cost of collection and administration. Tidelands
income is highly dependent on the prices realized from the sale of oil and natural gas and the quantities of production from the wells in which it has a royalty interest. Oil and natural gas prices have historically experienced significant
volatility. Tidelands is not permitted to manage its commodity price risk through the use of fixed price contracts or financial derivatives.

Due to the short span of time between receipts and disbursements, cash held by Tidelands is held in a non-interest bearing trust account,
therefore there is no material interest rate risk.

Oil and natural gas royalties received by Tidelands Corporation prior to delivery of
the 95% net profits interest to the Trust are held in money market accounts that invest in U.S. Treasury securities and are considered not subject to interest rate risk. The corpus of Tidelands Corporation is held in either money market accounts or
U.S. Treasury or agency securities that are held to maturity. Funds held in money market accounts and U.S. Treasury securities that mature in less than one year are not considered subject to interest rate risk.



|Item 8. | Financial Statements and Supplementary Data
|------- | -------------------------------------------

The consolidated
financial statements listed in the following index, together with the related notes and the report of Weaver and Tidwell, L.L.P., independent registered public accounting firm, are presented on the following pages and are incorporated by reference
herein.



|                                                                                                           |  |      |    | 
|---------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|                                                                                                           |  | Page |   
| Report of Independent Registered Public Accounting Firm                                                  |  |      | 22 | 
| Consolidated Statements of Assets, Liabilities and Trust Corpus as of December 31, 2015 and
2014         |  |      | 23 | 
| Consolidated Statements of Distributable Income for the Years Ended December 
31, 2015, 2014 and 2013    |  |      | 24 | 
| Consolidated Statements of Changes in Trust Corpus for the Years Ended December 
31, 2015, 2014 and 2013 |  |      | 25 | 
| Notes to Consolidated Financial Statements                                                               |  |      | 26 | 

See also Item 15. Exhibits and Financial Statement Schedules of this Annual Report on
Form 10-K for further information concerning the financial statements of Tidelands. All schedules have been omitted because they are either not required, not applicable or the required information is included in the consolidated financial
statements and notes thereto.



|Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|------- | ------------------------------------------------------------------------------------

Not applicable.



|Item 9A. | Controls and Procedures
|-------- | -----------------------

Effectiveness of Disclosure Controls and
Procedures

As of December 31, 2015, the Trustee carried out an evaluation of the effectiveness of the design and operation of
Tidelands disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based upon that evaluation, the Trustee concluded that Tidelands disclosure controls and procedures were effective as of
December 31, 2015.



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Changes in Internal Control Over Financial Reporting

There have not been any changes in Tidelands internal control over financial reporting during the fourth quarter of 2015 that have
materially affected, or are reasonably likely to materially affect, Tidelands internal control over financial reporting.

Trustees Report
on Internal Control Over Financial Reporting

The Trustee is responsible for establishing and maintaining adequate internal control
over financial reporting, as such term is defined in Rule 13a-15(f) or Rule 15d-15(f) under the Exchange Act. The Trustee conducted an evaluation of the effectiveness of the Trusts internal control over financial reporting based
on the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the Trustees evaluation, under the Internal Control-Integrated
Framework, the Trustee concluded that Tidelands internal control over financial reporting was effective as of December 31, 2015. This Annual Report on Form 10-K does not include an attestation report of Tidelands
registered public accounting firm regarding internal control over financial reporting since the Trustees report was not subject to attestation by Tidelands registered public accounting firm pursuant to an exemption for smaller reporting
companies pursuant to Section 404(c) of the Sarbanes-Oxley Act of 2002.



|Item 9B. | Other Information
|-------- | -----------------

None.



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Part III



|Item 10. | Directors, Executive Officers and Corporate Governance
|-------- | ------------------------------------------------------

Directors and Officers.The Trust is a trust created under the laws of the State of Texas. The Trusts Indenture does not provide
for directors or officers or the election or appointment of directors or officers. Under the Indenture, Southwest Bank serves as the Trustee.

Section 16(a) Beneficial Ownership Reporting Compliance. The Trust has no directors or officers and Marine is the only unitholder
that is a beneficial owner of more than 10% of the outstanding units. The Trust is not aware of any person that failed to file reports required by Section 16(a) under the Exchange Act on a timely basis during 2015.

Code of Ethics.Because the Trust has no employees, it does not have a code of ethics. Employees of the Trustee must comply with the
code of ethics of Southwest Bank, a copy of which will be made available to unitholders without charge, upon request by appointment at Southwest Bank, 2911 Turtle Creek Blvd., Suite 850, Dallas, Texas 75219.

Committees.The Trust has no directors and therefore has no audit committee or audit committee financial expert and no nominating
committee or compensation committee.



|Item 11. | Executive Compensation
|-------- | ----------------------

The Trust has no directors or officers
and is administered by the Trustee. Accordingly, the Trust does not have a compensation committee or maintain any equity compensation plans, and there are no units reserved for issuance under any such plans. During the past three years, the Trust
paid or accrued fees to the Trustee (or its former Trustee, U.S. Trust, Bank of America Private Wealth Management), as set forth below.



|                                                                          |  |            |      |  |                              |   |        | 
|------------------------------------------------------------------------- |  | ---------- | ---- |  | ---------------------------- | - | ------ | 
|Name of Individual or Entity                                              |  | FiscalYear |      |  | Other AnnualCompensation (1) |  
|Southwest Bank, Trustee (2)                                               |  |            | 2015 |  |                              | $ | 21,125 | 
|                                                                          |  |            | 2014 |  |                              | $ | 10,000 | 
|                                                                          |  |           
|U.S. Trust, Bank of America Private Wealth Management, former Trustee (2) |  |            | 2014 |  |                              | $ | 11,125 | 
|                                                                          |  |            | 2013 |  |                              | $ | 21,125 | 



|(1) | Under the Indenture, the Trustee is entitled to reasonable and customary fees and compensation for its services.
|--- | ----------------------------------------------------------------------------------------------------------------

|(2) | U.S. Trust, Bank of America Private Wealth Management served as corporate trustee until the appointment of Southwest Bank, effective May 30, 2014.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------



|Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|-------- | ----------------------------------------------------------------------------------------------

The following table sets forth the persons known to the Trust who beneficially own more than five percent of the outstanding units of
beneficial interest as of March 30, 2016:



|                             |  |                                                                              |  |                                          |  |                 |      |  
|---------------------------- |  | ---------------------------------------------------------------------------- |  | ---------------------------------------- |  | --------------- | ---- | -
|Title of Class               |  | Name and Address of
Beneficial Owner                                         |  | Amount and Nature ofBeneficial Ownership |  | Percentof Class |     
|Units of Beneficial Interest |  | Marine Petroleum Trust 2911 Turtle Creek
Blvd., Ste. 850 Dallas, Texas 75219 |  | 452,366 units                            |  |                 | 32.6 | %

There are no executive officers or directors of the Trust. The Trustee does not beneficially own any units of
beneficial interest. The Trust does not maintain any equity compensation plans and the Trust has not repurchased any units during the fourth quarter of 2015. The Trustee knows of no arrangements the operation of which may at a subsequent date result
in a change of control of the Trust.



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|Item 13. | Certain Relationships and Related Transactions, and Director Independence
|-------- | -------------------------------------------------------------------------

Pursuant to an arrangement with Marine Petroleum Corporation to share certain administrative expenses related to the use of office space that
was leased though April 30, 2014, Tidelands Corporation paid the following amounts to Marine Petroleum Corporation during the past three years. The arrangement provided that administrative expenses were shared in the ratio of each of Marine
Petroleum Corporations and Tidelands Corporations gross oil and natural gas royalties to the total gross oil and natural gas royalties of both entities.



|                             |  |      |  |             |        | 
|---------------------------- |  | ---- |  | ----------- | ------ | 
|Name of Individual or Entity |  | Year |  | Amount Paid |       
|Marine Petroleum Corporation |  | 2015 |  | $           |       | 
|                             |  | 2014 |  | $           | 9,000  | 
|                             |  | 2013 |  | $           | 36,000 | 



|Item 14. | Principal Accountant Fees and Services
|-------- | --------------------------------------

Fees for services
performed by Weaver and Tidwell, L.L.P., independent registered public accounting firm, for the years ended December 31, 2015 and 2014 were as follows:



|                   |  |      |        |  |      |   |        | 
|------------------ |  | ---- | ------ |  | ---- | - | ------ | 
|                   |  | 2015 |        |  | 2014 |  
|Audit Fees         |  | $    | 50,000 |  |      | $ | 50,000 | 
|Audit-Related Fees |  |      |       |  |      |   |       | 
|Tax Fees           |  |      |       |  |      |   |       | 
|All Other Fees     |  |      |       |  |      |   |       | 

Audit Fees includes the audit of Tidelands annual consolidated financial statements, reviews
of financial statements included in Tidelands quarterly reports on Form 10-Q and services that are normally provided by Weaver and Tidwell, L.L.P. in connection with its engagement for those years. This category also includes advice on
audit and accounting matters that arose during, or as a result of, the audit or review of Tidelands interim financial statements.

As referenced in Item 10. Directors, Executive Officers and Corporate Governance above, the Trust has no audit committee, and
as a result, has no audit committee pre-approval policy with respect to fees paid to Weaver and Tidwell, L.L.P.



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Part IV



|Item 15. | Exhibits and Financial Statement Schedules
|-------- | ------------------------------------------

(a) Financial Statements 
See Financial Statements and Supplementary Data above.

(b) Exhibits



4.1

Indenture of Trust dated June 1, 1954, as amended, filed as Exhibit 4.1 to the Trusts Quarterly Report on Form 10-Q for the period ended September 30, 2001 (File No. 000-08677), filed with the
Securities and Exchange Commission on November 14, 2001, and incorporated herein by reference.21.1

Subsidiaries of the Trust, filed as Exhibit 21.1 to the Trusts Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 000-08677), filed with the Securities and Exchange Commission
on April 2, 2007, and incorporated herein by reference.31.1*

Certification of the Corporate Trustee pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1*

Certification of the Corporate Trustee pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.




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

(c) Financial Statement Schedules  All required schedules are included in the financial
statements included in this Annual Report on Form 10-K.



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REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Trustee and
Stockholders of

Tidelands Royalty Trust B and subsidiary

We have audited the accompanying consolidated statements of assets, liabilities and trust corpus of Tidelands Royalty Trust B and Subsidiary (the
Trust) as of December 31, 2015 and 2014, and the related consolidated statements of distributable income and changes in trust corpus for each of the years in the three-year period ended December 31, 2015. The Trusts management is
responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Trusts internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial
statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As described in Note 2 to the consolidated financial statements, these consolidated financial statements were prepared on a modified cash basis of accounting,
which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America.

In our opinion, the
consolidated financial statements referred to above present fairly, in all material respects, the assets, liabilities, and trust corpus of Tidelands Royalty Trust B and Subsidiary as of December 31, 2015 and 2014, and distributable
income and changes in trust corpus for each of the years in the three-year period ended December 31, 2015 in conformity with the modified cash basis of accounting described in Note 2 to the consolidated financial statements.

/s/ WEAVER AND TIDWELL, L.L.P

Dallas, Texas

March 30, 2016



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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF ASSETS, LIABILITIES AND TRUST CORPUS

As of December 31, 2015 and 2014



|                                                                                                    |  |                  |         |  |                  |   |         | 
|--------------------------------------------------------------------------------------------------- |  | ---------------- | ------- |  | ---------------- | - | ------- | 
|                                                                                                    |  | December 31,2015 |         |  | December 31,2014 |  
|Assets                                                                                              |  |                  |         |  |                  |   |         | 
|Current assets:                                                                                     |  |                  |         | 
|Cash and cash equivalents                                                                           |  | $                | 579,803 |  |                  | $ | 777,926 | 
|Producing oil and natural gas properties                                                            |  |                  | 2       |  |                  |   | 2       | 
|Federal income taxes refundable                                                                     |  |                  |        |  |                  |   |        | 
|                                                                                                    |  |                  |         |  |                  |   |         | 
|Total assets                                                                                        |  | $                | 579,805 |  |                  | $ | 777,928 | 
|                                                                                                    |  |                  |         |  |                  |   |         | 
|                                                                                                    |  |                 
|Liabilities and Trust Corpus                                                                        |  |                  |         |  |                  |   |         | 
|                                                                                                    |  |                 
|Current liabilities:                                                                                |  |                  |         |  |                  |   |         | 
|Income distributable to unitholders                                                                 |  |                  | 55,201  |  |                  |   | 168,521 | 
|                                                                                                    |  |                  |         |  |                  |   |         | 
|Total current liabilities                                                                           |  | $                | 55,201  |  |                  | $ | 168,521 | 
|                                                                                                    |  |                  |         |  |                  |   |         | 
|                                                                                                    |  |                 
|Trust corpus  authorized 1,386,525 units of beneficial interest, issued 1,386,375 at nominal value |  |                  | 524,604 |  |                  |   | 609,407 | 
|                                                                                                    |  |                  |         |  |                  |   |         | 
|                                                                                                    |  | $                | 579,805 |  |                  | $ | 777,928 | 
|                                                                                                    |  |                  |         |  |                  |   |         | 

See accompanying notes to consolidated financial statements.



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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF DISTRIBUTABLE INCOME

For the Years ended December 31,



|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|------------------------------------------------ |  | ---- | --------- |  | ---- | - | --------- | ---- |  | - | --------- | 
|                                                 |  | 2015 |           |  | 2014 |   |           | 2013 | 
|Income:                                          |  |      |           | 
|Oil and natural gas royalties                    |  | $    | 373,510   |  |      | $ | 716,922   |      |  | $ | 662,989   | 
|Interest income                                  |  |      | 69        |  |      |   | 89        |      |  |   | 16        | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|Total income                                     |  | $    | 373,579   |  |      | $ | 717,011   |      |  | $ | 663,005   | 
|                                                 |  |      |          
|Expenses:                                        |  |      |           |  |      |   |           |      |  |   |           | 
|General and administrative expenses              |  | $    | 137,509   |  |      | $ | 215,845   |      |  | $ | 189,245   | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|Distributable income before Federal income taxes |  |      | 236,070   |  |      |   | 501,166   |      |  |   | 473,760   | 
|Federal income taxes of subsidiary               |  |      |          |  |      |   |          |      |  |   |          | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|Distributable income                             |  | $    | 236,070   |  |      | $ | 501,166   |      |  | $ | 473,760   | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|                                                 |  |      |          
|Distributable income per unit                    |  | $    | 0.17      |  |      | $ | 0.36      |      |  | $ | 0.34      | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|                                                 |  |      |          
|Distributions per unit                           |  | $    | 0.23      |  |      | $ | 0.36      |      |  | $ | 0.41      | 
|                                                 |  |      |           |  |      |   |           |      |  |   |           | 
|Units outstanding                                |  |      | 1,386,375 |  |      |   | 1,386,375 |      |  |   | 1,386,375 | 

See accompanying notes to consolidated financial statements.



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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN TRUST CORPUS

For the Years ended December 31,



|                                |  |      |          |   |      |   |          |      |  |   |          |  
|------------------------------- |  | ---- | -------- | - | ---- | - | -------- | ---- |  | - | -------- | -
|                                |  | 2015 |          |   | 2014 |   |          | 2013 | 
|                                |  |      |         
|Trust corpus, beginning of year |  | $    | 609,407  |   |      | $ | 600,803  |      |  | $ | 699,777  |  
|Distributable income            |  |      | 236,070  |   |      |   | 501,166  |      |  |   | 473,760  |  
|Distributions to unitholders    |  |      | (320,873 | ) |      |   | (492,562 | )    |  |   | (572,734 | )
|                                |  |      |          |   |      |   |          |      |  |   |          |  
|Trust corpus, end of year       |  | $    | 524,604  |   |      | $ | 609,407  |      |  | $ | 600,803  |  
|                                |  |      |          |   |      |   |          |      |  |   |          |  

See accompanying notes to consolidated financial statements.



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TIDELANDS ROYALTY TRUST B AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2015



| | (1) | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND GENERAL
| | --- | ------------------------------------------------------



| | (a) | General
| | --- | -------

Tidelands Royalty Trust B (the Trust) was established on
June 1, 1954 with a transfer of contract rights to certain properties to the Trust in exchange for units of beneficial interest. The contract rights enable the Trust to receive an interest in any oil, natural gas or other mineral leases
obtained by Gulf Oil Corporation, now Chevron U.S.A., Inc. (Chevron), which is a subsidiary of Chevron Corporation and its assignees in a designated area of the Gulf of Mexico during a 50-year period that expired on April 30, 2001.

The Trust is required under its Indenture to distribute all income, after paying its liabilities and obligations, to the unitholders
quarterly. The Trust cannot invest any of its money for any purpose and cannot engage in a trade or business.

The Trusts
wholly-owned subsidiary, Tidelands Royalty B Corporation (Tidelands Corporation), holds title to interests in properties that are situated offshore of Louisiana. Ninety-five percent of all oil, natural gas, and other mineral
royalties collected by this subsidiary are retained by and delivered to the Trust. Tidelands Corporation, like the Trust, is prohibited from engaging in a trade or business and does only those things necessary for the administration and liquidation
of its properties. The Trust is authorized to pay the expenses of Tidelands Corporation should it be necessary.

The Trust and its
subsidiary have no employees. Tidelands Corporation has entered into an arrangement with Marine Petroleum Corporation (a wholly-owned subsidiary of Marine Petroleum Trust, an affiliate of the Trust) to share certain administrative expenses related
to the use of office space that was leased through April 30, 2014 and to assist the trustee in the administration of the Trust. For the years ended December 31, 2015, 2014 and 2013, Tidelands Corporation paid $0, $9,000 and $36,000,
respectively, to Marine Petroleum Corporation as reimbursement for the use of such office space. At December 31, 2015 and 2014, Marine Petroleum Trust owned 32.6% of the Trusts outstanding units of beneficial interest.



| | (b) | Unitholder Voting Matters
| | --- | -------------------------

On March 27, 2001, the unitholders of record at the close of
business on February 16, 2001, approved an amendment to the Indenture to extend the term of the Trust to April 30, 2021.



| | (c) | Principles of Consolidation
| | --- | ---------------------------

The consolidated financial statements include the Trust and its
wholly-owned subsidiary, Tidelands Corporation. All material intercompany accounts and transactions have been eliminated upon consolidation.



| | (d) | Producing Oil and Natural Gas Properties
| | --- | ----------------------------------------

At the time the Trust was established, no
determinable market value was available for the assets transferred to the Trust; consequently, nominal values were assigned. Accordingly, no allowance for depletion has been included.

Tidelands revenues are derived from production payments and overriding royalty interests related to properties located in the Gulf of
Mexico.



| | (e) | U.S. Federal Income Taxes
| | --- | -------------------------

No provision has been made for U.S. Federal income taxes on the
Trusts income since such taxes are the liability of the unitholders.



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U.S. Federal income taxes are provided on the income of Tidelands Corporation (which specifically
excludes the 95% net profits interest to be retained by and delivered to the Trust) after deducting statutory depletion. There were no significant deferred tax assets or liabilities as of December 31, 2015 and 2014. Tidelands Corporation
uses the cash method of reporting for Federal income taxes.

The primary difference between the actual tax expense of Tidelands
Corporation and the expected tax expense is due to the fact that only 5% of Tidelands Corporations income (i.e., excluding the 95% net profits interest retained by and delivered to the Trust) is subject to U.S. Federal income tax.

Tax positions taken by the Trust related to the Trusts pass-through status and Federal state tax positions have been reviewed, and the
Trustee is of the opinion that material positions taken would more likely than not be sustained by examination. In accordance with the Trusts basis of accounting discussed in Note 1, the Trust would only recognize the impact of tax positions
that were not upheld at the time of payment. As of December 31, 2015, the Trusts tax years 2012 and thereafter remain subject to examination.

Tidelands Corporation recognizes interest and penalties related to unrecognized tax benefits in income tax expense.



| | (f) | Credit Risk Concentration and Cash Equivalents
| | --- | ----------------------------------------------

Financial instruments which potentially subject
the Trust and Tidelands Corporation to concentrations of credit risk are primarily investments in cash equivalents. The Trust and Tidelands Corporation place their cash investments with financial institutions that the Trustee considers creditworthy
and limit the amount of credit exposure from any one financial institution. The estimated fair values of cash equivalents approximate the carrying values due to the short term nature of these financial instruments.

Tidelands had cash and cash equivalents of $579,803 and $777,926 at December 31, 2015 and 2014, respectively, which consisted of cash
deposits, U.S. Treasury and agency bonds, and money market accounts.



| | (g) | Use of Estimates
| | --- | ----------------

The preparation of financial statements in conformity with the modified cash
basis method of accounting requires the Trustee to make various estimates and assumptions that affect the reported amount of liabilities at the date of the consolidated financial statements and the reported amount of expenses during the reporting
period. Actual results may differ from such estimates.



| | (h) | Distributable Income per Unit
| | --- | -----------------------------

Distributable income per unit is determined by dividing
distributable income by the number of units of beneficial interest outstanding during the period.



| | (i) | Significant Royalty Sources
| | --- | ---------------------------

The following table presents the approximate percentage of
royalties actually received from each royalty payor for the past three years:



|                                          |  |      |     |   |      |  |     |      |  |  |     |  
|----------------------------------------- |  | ---- | --- | - | ---- |  | --- | ---- |  |  | --- | -
|Royalty Payors                            |  | 2015 |     |   | 2014 |  |     | 2013 | 
|Black Elk Energy Offshore Operations, LLC |  |      |    |   |      |  | 44  | %    |  |  | 48  | %
|Fieldwood Energy LLC/Apache Corporation   |  |      | 38  | % |      |  | 47  | %    |  |  | 52  | %
|Renaissance Offshore LLC                  |  |      | 60  | % |      |  | 9   | %    |  |  |    |  
|Eni Operating Co., Inc.                   |  |      | 2   | % |      |  |    |      |  |  |    |  
|                                          |  |      |     |   |      |  |     |      |  |  |     |  
|                                          |  |      | 100 | % |      |  | 100 | %    |  |  | 100 | %
|                                          |  |      |     |   |      |  |     |      |  |  |     |  



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| | (2) | BASIS OF ACCOUNTING
| | --- | -------------------

The financial statements of Tidelands have been prepared on the
modified cash basis method and are not intended to present financial position and results of operations in conformity with generally accepted accounting principles in the United States (GAAP). Under the modified cash basis method:



| |  |  | Royalty income is recognized when received by Tidelands.
| | - |  | --------------------------------------------------------



| |  |  | Tidelands expenses (which include accounting, legal, and other professional fees, trustees fees and out-of-pocket expenses) are recorded on an actual paid basis. Reserves for liabilities that are contingent
or uncertain in amount may also be established if considered necessary.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Distributions to unitholders are recognized when declared by the Trustee of the Trust.
| | - |  | --------------------------------------------------------------------------------------

The
financial statements of Tidelands differ from financial statements prepared in conformity with GAAP because of the following:



| |  |  | Royalty income is recognized in the month received rather than in the month of production.
| | - |  | ------------------------------------------------------------------------------------------



| |  |  | Reserves may be established for contingencies that would not be recorded under GAAP.
| | - |  | ------------------------------------------------------------------------------------



| |  |  | Expenses are recorded in the month paid rather than in the month incurred.
| | - |  | --------------------------------------------------------------------------

This comprehensive
basis of accounting corresponds to the accounting principles permitted for royalty trusts by the SEC, as specified by Staff Accounting Bulletin Topic 12:E, Financial Statements of Royalty Trusts.



| | (3) | TEXAS FRANCHISE TAX
| | --- | -------------------

Texas imposes a franchise tax that applies to most business
entities that are formed or qualified to do business, or that are otherwise doing business, in Texas. Under the Texas franchise tax statute, a 0.75% tax (in certain cases not applicable here, the tax rate is 0.475%) is imposed for reports due in
2016 on each taxable entitys taxable margin that is apportioned to Texas. Taxable margin is generally defined as revenues less certain costs, as provided under the statute. Most entities that provide owners with limited liability protection,
including trusts, are considered to be taxable entities for purposes of the Texas franchise tax. The statute provides certain limited exemptions from the tax, including exclusions for certain passive entities that satisfy specified
statutory requirements as described below.

Under the Texas franchise tax statute, passive entities, including trusts, that
meet the following requirements, are exempt from the Texas franchise tax: (a) the trust cannot be a business trust within the meaning of U.S. Treasury Regulation section 301.7701-4(b); (b) at least 90% of the trusts income for the
taxable year must be derived from passive sources (e.g., royalties, bonuses, delay rental income from mineral properties, dividends, interest, gains from the sale of securities); and (c) no more than 10% of the trusts income for the
taxable year can be derived from an active trade or business (e.g., rent, certain income received by a non-operator under a joint operating agreement pursuant to which the operator is the member of an affiliated group that includes such
non-operator). An entity will determine on an annual basis whether it meets the requirements to be treated as a passive entity for Texas franchise tax purposes. The Trustee believes that all or substantially all of the income of the
Trust currently is passive, as it consists of royalty income from the sale of oil and natural gas, dividends and interest income. Subject to any change in the sources of income derived by the Trust or any change in the Indenture, the Trust expects
that it will continue to qualify as a passive entity that is not subject to the franchise tax.



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If the Trust is exempt from the Texas franchise tax as a passive entity, each unitholder that is
subject to the Texas franchise tax as a taxable entity under the Texas Tax Code should generally include its share of the Trusts revenue in its franchise tax computation. The Texas franchise tax does not apply to natural persons. The Trust
anticipates that it will be a passive entity in the tax year ending in 2015.



| | (4) | SUPPLEMENTAL INFORMATION RELATING TO OIL AND NATURAL GAS RESERVES (UNAUDITED)
| | --- | -----------------------------------------------------------------------------

Oil and
natural gas reserve information relating to the Trusts royalty interests is not presented because such information is not available to the Trust without unreasonable effort or expense. The Trusts share of oil and natural gas produced for
its royalty interests was as follows:



|                           |  |                                 |        |  |      |  |        |      |  |  |        | 
|-------------------------- |  | ------------------------------- | ------ |  | ---- |  | ------ | ---- |  |  | ------ | 
|                           |  | For the Year Ended December 31, |       
|                           |  | 2015                            |        |  | 2014 |  |        | 2013 | 
|Net production quantities: |  |                                 |        |  |      |  |        |      |  |  |        | 
|Oil (bbls)                 |  |                                 | 4,460  |  |      |  | 4,537  |      |  |  | 3,577  | 
|Natural gas (mcf)          |  |                                 | 43,410 |  |      |  | 53,152 |      |  |  | 68,935 | 



| | (5) | SUMMARY OF QUARTERLY FINANCIAL DATA (UNAUDITED)
| | --- | -----------------------------------------------

The following quarterly financial
information for the years ended December 31, 2015 and 2014 is unaudited; however, in the opinion of the Trustee, all adjustments necessary to present a fair statement of the results of operations for the interim periods have been included.



|                   |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|------------------ |  | --------------------------- | ------- |  | ------------------------- | - | ------- | --------------------------------- |  | - | ---- | 
|                   |  | Oil andNatural GasRoyalties |         |  | DistributableIncome(Loss) |   |         | DistributableIncome(Loss) PerUnit | 
|Quarter ended:     |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|March 31, 2014     |  | $                           | 140,790 |  |                           | $ | 95,471  |                                   |  | $ | 0.07 | 
|June 30, 2014      |  |                             | 131,397 |  |                           |   | 37,014  |                                   |  |   | 0.03 | 
|September 30, 2014 |  |                             | 253,703 |  |                           |   | 224,002 |                                   |  |   | 0.16 | 
|December 31, 2014  |  |                             | 191,032 |  |                           |   | 144,679 |                                   |  |   | 0.10 | 
|                   |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|                   |  | $                           | 716,922 |  |                           | $ | 501,166 |                                   |  | $ | 0.36 | 
|                   |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|Quarter ended:     |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|March 31, 2015     |  | $                           | 90,012  |  |                           | $ | 72,543  |                                   |  | $ | 0.05 | 
|June 30, 2015      |  |                             | 76,533  |  |                           |   | (3,999  | )                                 |  |   | 0.00 | 
|September 30, 2015 |  |                             | 115,617 |  |                           |   | 89,719  |                                   |  |   | 0.06 | 
|December 31, 2015  |  |                             | 91,348  |  |                           |   | 77,807  |                                   |  |   | 0.06 | 
|                   |  |                             |         |  |                           |   |         |                                   |  |   |      | 
|                   |  | $                           | 373,510 |  |                           | $ | 236,070 |                                   |  | $ | 0.17 | 
|                   |  |                             |         |  |                           |   |         |                                   |  |   |      | 



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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual
Report on Form 10-K to be signed by the undersigned thereunto duly authorized.



|                     |  |                                                          |  |     |  |                      
|-------------------- |  | -------------------------------------------------------- |  | --- |  | ---------------------
|                     |  | Tidelands Royalty Trust B                             
|Date: March 30, 2016 |  | (Registrant)                                            
|                     | 
|                     |  | By: Southwest Bank (in its capacity as Corporate Trustee
|                     |  | of Tidelands Royalty Trust B and not in               
|                     |  | its individual capacity or otherwise)                   
|                     |  |                                                          | 
|                     |  |                                                          |  | By: |  | /s/ Ron E. Hooper    
|                     |  |                                                          |  |     |  | Ron E. Hooper        
|                     |  |                                                          |  |     |  | Senior Vice President

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been
signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.



|               |  |                   |  |               
|-------------- |  | ----------------- |  | --------------
|NAME           |  | CAPACITIES        |  | DATE          
|               |  |                  
|Southwest Bank |  | Corporate Trustee |  | March 30, 2016



|    |  |                      
|--- |  | ---------------------
|By: |  | /s/ Ron E. Hooper    
|    |  | Ron E. Hooper        
|    |  | Senior Vice President

(The Registrant has no directors or executive officers).



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EXHIBIT INDEX



|              |  |                                                                                                                                                                                                                                                                                                 
|------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                                     
|              | 
|4.1           |  | Indenture of Trust dated June 1, 1954, as amended, filed as Exhibit 4.1 to the Trusts Quarterly Report on Form 10-Q for the period ended September 30, 2001 (File No. 000-08677), filed with the Securities and Exchange
Commission on November 14, 2001, and incorporated herein by reference.
|              | 
|21.1          |  | Subsidiaries of the Trust, filed as Exhibit 21.1 to the Trusts Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (File No. 000-08677), filed with the Securities and Exchange Commission on April 2, 2007,
and incorporated herein by reference.                          
|              | 
|31.1*         |  | Certification of the Corporate Trustee pursuant to Section 302 of the Sarbanes-Oxley of Act of 2002.                                                                                                                                                                                            
|              | 
|32.1*         |  | Certification of the Corporate Trustee pursuant to Section 906 of the Sarbanes-Oxley of Act of 2002.                                                                                                                                                                                            



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



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