##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form 10-Q
  þ

Quarterly Report Pursuant to Section 13 or 15(d)  of the
    Securities Exchange Act of 1934For the Quarterly Period Ended
    September 30,
    2009oro

Transition Report Pursuant to Section 13 or 15(d)  of
    the Securities Exchange Act of 1934For the transition period
    from          to   Commission File
    No. 1-8032
  SAN JUAN BASIN ROYALTY
    TRUST
 (Exact name of registrant as
    specified in the Amended and Restated San Juan Basin
    Royalty Trust Indenture)
  Texas

75-6279898(State or other jurisdiction
    of incorporation or organization)

(I.R.S. Employer
    Identification No.)   Compass
    Bank
    2525 Ridgmar Boulevard, Suite 100
    Fort Worth, Texas 76116 (Address
    of principal executive offices)
    (Zip Code)
  (866) 809-4553
 (Registrants telephone
    number, including area code)
  N/A (Former
    name, former address and former fiscal year, if changed since
    last report)
  þ o
  Regulation S-T o o
  Rule 12b-2
  Large accelerated
    filer þ

Accelerated
    filer o

Non-accelerated
    filer o(Do not check if
    a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2 o þ




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TABLE OF CONTENTS  PART IFINANCIAL INFORMATIONItem 1. Financial Statements.Item 2. Trustees Discussion and Analysis of Financial Condition and Results of Operations.Item 3. Quantitative and Qualitative Disclosures About Market Risk.Item 4. Controls and Procedures.PART IIOTHER INFORMATIONItem 1. Legal Proceedings.Item 6. Exhibits.SIGNATURESINDEX TO EXHIBITSEX-31EX-32    Table of Contents   SAN JUAN
    BASIN ROYALTY TRUST
 
  PART I
 
  FINANCIAL
    INFORMATION
 
  Item 1.
    Financial
    Statements.  Form 10-K
 2




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SAN JUAN
    BASIN ROYALTY TRUST
  CONDENSED
    STATEMENTS OF ASSETS, LIABILITIES AND
    TRUST CORPUS
  September 30,


December 31,2009


2008(Unaudited)ASSETSCash and short-term investments

$
2,632,743


$
7,449,767Net overriding royalty interest in producing oil and gas
    properties (net of accumulated amortization of $115,997,319 and
    $115,348,030 at September 30, 2009 and December 31,
    2008, respectively)


17,278,209



17,927,498$
19,910,952


$
25,377,265LIABILITIES AND TRUST CORPUSDistribution payable to Unit Holders

$
2,476,954


$
7,293,978Cash reserves


155,789



155,789Trust corpus  46,608,796 Units of beneficial interest
    authorized and outstanding


17,278,209



17,927,498$
19,910,952


$
25,377,265   CONDENSED
    STATEMENTS OF DISTRIBUTABLE INCOME (UNAUDITED)
  Three Months Ended


Nine Months EndedSeptember 30,


September 30,2009


2008


2009


2008Royalty income

$
7,232,890


$
52,541,763


$
19,257,575


$
113,730,327Interest income


194,481



32,508



197,892



216,621Total Revenue


7,427,371



52,574,271



19,455,467



113,946,948General and administrative expenditures


435,690



351,221



1,706,123



1,554,074Distributable income

$
6,991,681


$
52,223,050


$
17,749,344


$
112,392,874Distributable income per Unit (46,608,796 Units)

$
0.150007


$
1.120455


$
0.380814


$
2.411409    3




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SAN JUAN
    BASIN ROYALTY TRUST
  CONDENSED
    STATEMENTS OF CHANGES IN TRUST CORPUS (UNAUDITED)
  Three Months Ended


Nine Months EndedSeptember 30,


September 30,2009


2008


2009


2008Trust corpus, beginning of period

$
17,572,134


$
18,975,921


$
17,927,498


$
19,880,888Amortization of net overriding royalty interest


(293,925
)


(543,459
)


(649,289
)


(1,448,426
)Distributable income


6,991,681



52,223,050



17,749,344



112,392,874Distributions declared


(6,991,681
)


(52,223,050
)


(17,749,344
)


(112,392,874
)Trust corpus, end of period

$
17,278,209


$
18,432,462


$
17,278,209


$
18,432,462    4




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SAN JUAN
    BASIN ROYALTY TRUST
  NOTES TO
    CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
  1.
    BASIS OF
    ACCOUNTING    
    Royalty income recorded for a month is the amount computed and
    paid with respect to the Trusts 75% net overriding royalty
    interest (the Royalty) in certain oil and gas
    leasehold and royalty interests (the Underlying
    Properties) by Burlington Resources Oil & Gas
    Company LP (BROG), the present owner of the
    Underlying Properties, to the Trustee for the Trust. Royalty
    income consists of the proceeds received by BROG from the sale
    of production from the Underlying Properties less accrued
    production costs, development and drilling costs, applicable
    taxes, operating charges, and other costs and deductions,
    multiplied by 75%. The calculation of net proceeds by BROG for
    any month includes adjustments to proceeds and costs for prior
    months and impacts the Royalty income paid to the Trust and the
    distribution to Unit Holders for that month.
    Trust expenses recorded are based on liabilities paid and cash
    reserves established from Royalty income for liabilities and
    contingencies.
    Distributions to Unit Holders are recorded when declared by the
    Trustee.
    The conveyance which transferred the Royalty to the Trust
    provides that any excess of development and production costs
    applicable to the Underlying Properties over gross proceeds from
    such properties must be recovered from future net proceeds
    before Royalty income is again paid to the Trust.  unit-of-production
    2.
    FEDERAL
    INCOME TAXES         5




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SAN JUAN
    BASIN ROYALTY TRUST
  NOTES TO
    CONDENSED FINANCIAL STATEMENTS
    (UNAUDITED)  (Continued)
      3.
    CONTINGENCIES    4.
    SETTLEMENTS
    AND LITIGATION  United States of America ex rel. Harrold E.
    (Gene) Wright v. AGIP Petroleum Co. et al.
  San Juan Basin Royalty Trust vs. Burlington
    Resources Oil & Gas Company, L.P.
       6




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Item 2.
    Trustees
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Forward-Looking
    Information
  Form 10-Q
  Business
    Overview
           7




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Three
    Months Ended September 30, 2009 and 2008
  per-Unit
  July

$
.035394August


.061470September


.053143Quarter Total

$
.150007          8




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Three Months EndedSeptember 30,2009

2008Gas:Total sales (Mcf)


8,916,522



8,737,027Mcf per day


96,919



94,968Average price (per Mcf)

$
2.98


$
10.62Oil:Total sales (Bbls)


17,414



12,793Bbls per day


189



139Average price (per Bbl)

$
56.08


$
120.99     Three Months EndedSeptember 30,2009

2008Gas sales (Mcf)


2,563,130



5,326,507Oil sales (Bbls)


5,004



7,724      9




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year-to-year
    Nine
    Months Ended September 30, 2009 and 2008
         10




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Nine Months EndedSeptember 30,2009

2008Gas:Total sales (Mcf)


25,986,144



25,133,676Mcf per day


95,187



91,729Average price (per Mcf)

$
3.28


$
8.72Oil:Total Sales (Bbls)


43,689



36,168Bbls per day


160



132Average price (per Bbl)

$
45.34


$
101.88     Nine Months EndedSeptember 30,2009

2008Gas sales (Mcf)


6,034,462



14,579,826Oil sales (Bbls)


9,820



20,787    11




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Calculation
    of Royalty Income
    CALCULATION
    OF ROYALTY INCOME
  Three Months Ended


Nine Months EndedSeptember 30,


September 30,2009


2008


2009


2008Gross proceeds of sales from the Underlying Properties:Gas proceeds

$
26,539,822
(1)

$
92,813,502


$
85,149,264


$
212,607,028
(2)Oil proceeds


976,542



1,547,800



1,980,659



3,684,910Total


27,516,364



94,361,302



87,129,923



216,291,938Less production costs:Severance tax  gas


2,381,417



8,391,694



7,685,851



19,856,326Severance tax  oil


94,969



152,033



193,945



369,512Other










1,020
(3)


Lease operating expense and property tax


7,970,231



8,224,170



25,266,377



24,566,288Capital expenditures


7,425,894



7,537,721



28,305,963



19,859,376Total


17,872,511



24,305,618



61,453,156



64,651,502Net profits


9,643,853



70,055,684



25,676,767



151,640,436Net overriding royalty interest


75
%


75
%


75
%


75
%Royalty Income

$
7,232,890


$
52,541,763


$
19,257,575


$
113,730,327     (1)
    
    In August 2009, gas proceeds included $540,069 resulting from
    granted audit exceptions.(2)
    
    In March 2008, gas proceeds were reduced by $6,562,104 as the
    amount BROG determined to be the Trusts portion of
    BROGs settlement of a legal matter with the Minerals
    Management Service and the Bureau of Indian Affairs.(3)
    
    Reflects the fee for BROG volume exchanges during the production
    month of April 2009.  Contractual
    Obligations
  1 20 1 30
  Effects
    of Securities Regulation
   12




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Critical
    Accounting Policies
    
    Royalty Income recorded for a month is the amount computed and
    paid pursuant to the Conveyance by BROG to the Trustee for the
    Trust. Royalty Income consists of the proceeds received by BROG
    from the sale of production from the Underlying Properties less
    accrued production costs, development and drilling costs,
    applicable taxes, operating charges, and other costs and
    deductions, multiplied by 75%. The calculation of net proceeds
    by BROG for any month includes adjustments to proceeds and costs
    for prior months and impacts the Royalty Income paid to the
    Trust and the distribution to Unit Holders for that month.
    Trust expenses recorded are based on liabilities paid and cash
    reserves established from Royalty Income for liabilities and
    contingencies.
    Distributions to Unit Holders are recorded when declared by the
    Trustee.
    The Conveyance which transferred the Royalty to the Trust
    provides that any excess of development and production costs
    applicable to the Underlying Properties over gross proceeds from
    such properties must be recovered from future net proceeds
    before Royalty Income is again paid to the Trust.  unit-of-production
 
  Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk.   
  Item 4.
    Controls
    and Procedures.  Form 10-Q
 13




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Form 10-Q
   14




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PART II
 
  OTHER
    INFORMATION
 
  Item 1.
    Legal
    Proceedings.  Form 10-Q
  United States of America ex rel. Harrold E.
    (Gene) Wright v. AGIP Petroleum Co. et al.
  San Juan Basin Royalty Trust vs. Burlington
    Resources Oil & Gas Company, L.P. No. D1329-CV-08-751,
         15




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Item 6.
    Exhibits.  (4)(a)


Amended and Restated Royalty Trust Indenture, dated
    September 30, 2002 (the original Royalty
    Trust Indenture, dated November 1, 1980, having been
    entered into between Southland Royalty Company and The
    Fort Worth National Bank, as Trustee), heretofore filed as
    Exhibit 99.2 to the Trusts Current Report on
    Form 8-K
    filed with the Commission on October 1, 2002, is
    incorporated herein by reference.*(4)(b)


Net Overriding Royalty Conveyance from Southland Royalty Company
    to the Fort Worth National Bank, as Trustee, dated
    November 3, 1980 (without Schedules), heretofore filed as
    Exhibit 4(b) to the Trusts Annual Report on
    Form 10-K
    filed with the Commission for the fiscal year ended
    December 31, 2007, is incorporated herein by reference.*(4)(c)


Assignment of Net Overriding Interest (San Juan Basin
    Royalty Trust), dated September 30, 2002, between Bank One,
    N.A. and TexasBank, heretofore filed as Exhibit 4(c) to the
    Trusts Quarterly Report on
    Form 10-Q
    filed with the Commission for the quarter ended
    September 30, 2002, is incorporated herein by reference.*31


Certification required by
    Rule 13a-14(a),
    dated November 9, 2009, by Lee Ann Anderson, Vice President
    and Senior Trust Officer of Compass Bank, the Trustee of
    the Trust.**32


Certification required by
    Rule 13a-14(b),
    dated November 9, 2009, by Lee Ann Anderson, Vice President
    and Senior Trust Officer of Compass Bank, on behalf of
    Compass Bank, the Trustee of the Trust.***     *
    A copy of this exhibit is available to any Unit Holder (free of
    charge) upon written request to the Trustee, Compass Bank, 2525
    Ridgmar Boulevard, Suite 100, Fort Worth, Texas 76116.**
    Filed herewith.***
    Furnished herewith. 16




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SIGNATURES
    
  By:
    /s/ Lee Ann Anderson       (The Trust
    has no directors or executive officers.)
 17




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INDEX TO
    EXHIBITS
  ExhibitNumber

Description(4)(a)

Amended and Restated Royalty Trust Indenture, dated
    September 30, 2002 (the original Royalty
    Trust Indenture, dated November 1, 1980, having been
    entered into between Southland Royalty Company and The
    Fort Worth National Bank, as Trustee), heretofore filed as
    Exhibit 99.2 to the Trusts Current Report on
    Form 8-K
    filed with the Commission on October 1, 2002, is
    incorporated herein by reference.*(4)(b)

Net Overriding Royalty Conveyance from Southland Royalty Company
    to the Fort Worth National Bank, as Trustee, dated
    November 3, 1980 (without Schedules), heretofore filed as
    Exhibit 4(b) to the Trusts Annual Report on
    Form 10-K
    filed with the Commission for the fiscal year ended
    December 31, 2007, is incorporated herein by reference.*(4)(c)

Assignment of Net Overriding Interest (San Juan Basin
    Royalty Trust), dated September 30, 2002, between Bank One,
    N.A. and TexasBank, heretofore filed as Exhibit 4(c) to the
    Trusts Quarterly Report on
    Form 10-Q
    with the Commission for the quarter ended September 30,
    2002, is incorporated herein by reference.*31

Certification required by
    Rule 13a-14(a),
    dated November 9, 2009, by Lee Ann Anderson, Vice President
    and Senior Trust Officer of Compass Bank, the Trustee of
    the Trust.**32

Certification required by
    Rule 13a-14(b),
    dated November 9, 2009, by Lee Ann Anderson, Vice President
    and Senior Trust Officer of Compass Bank, on behalf of
    Compass Bank, the Trustee of the Trust.***     *
    A copy of this exhibit is available to any Unit Holder (free of
    charge) upon written request to the Trustee, Compass Bank, 2525
    Ridgmar Boulevard, Suite 100, Fort Worth, Texas 76116.**
    Filed herewith.***
    Furnished herewith. 18