Q4 2023 Black Stone Minerals LP Earnings Call
Operator: Amen. Amen. Amen. Amen.
Please standby we're about to begin.
Operator: Please stand by; we're about to begin. Good day, and welcome to Black Stone Minerals' fourth quarter and year-end earnings call. At this time, all participants are in a listen-only mode. Later, there will be a question and answer session. You may queue for a question at any time by pressing the star key followed by the number one on your telephone keypad. Please be advised that today's conference is being recorded. If you require operator assistance, please press star zero. I'd now like to turn the call over to Mark Moe, Director of Finance. Please go ahead.
Good day, and welcome to the Blackstone minerals fourth quarter and year end earnings call. At this time all participants are in a listen only mode. Later, there will be a question and answer session. You may queue for a question at any time my approaching that Starkey followed by the number one on your telephone keypad.
Please be advised.
Today's conference is being recorded if you require operator assistance. Please press star Zero I'd now like to turn the call over to Mark Moe Director of Finance. Please go ahead.
Mark Moe: Thank you. Good morning to everyone. Thank you for joining us either by phone or online for Blackstone Minerals' fourth quarter and full year 2023 earnings conference call. Today's call is being recorded and will be available on our website along with the earnings release, which was issued by. Before we start, I'd like to advise you that we will be making forward-looking statements during this call about our plans, expectations, and assumptions regarding our future. These statements involve risks that may cause our actual results to differ materially from the results expressed or implied in our forward-looking statements. For a discussion of these risks, you should refer to the cautionary information about forward-looking statements in our press release from yesterday and the risk factors section of our 2023 10-K that we expect to file later today.
Thank you good morning to everyone. Thank you for joining us either by phone or online for Black Stone Minerals' fourth quarter and full year 2023 earnings Conference call. Today's call is being recorded and will be available on our website along with the earnings release, which was issued last night.
Before we start I'd like to advise you that we will be making forward looking statements. During this call about our plans expectations and assumptions regarding our future performance.
These statements involve risks that may cause our actual results to differ materially from the results expressed or implied in our forward looking statements for a discussion of these risks you should refer to the cautionary information about forward looking statements in our press release from yesterday and the risk factors section of our 2023 10-K.
That we expect to file later today, we may refer to certain non-GAAP financial measures that we believe are useful in evaluating our performance reconciliation of those measures to the most directly comparable GAAP measure and other information about these non-GAAP metrics are described in our earnings press release from yesterday, which can be found on our website.
Mark Moe: We may refer to certain non-GAAP financial measures that we believe are useful in evaluating our... Reconciliation of those measures to the most directly comparable gap measure and other information about these non-GAAP measures are described in our earnings press release from yesterday, which can be found on our website at www.blackstoneminerals.com. Joining me on the call from the company are Tom Carter, Chairman, CEO, and President; Evan Kiefer, Senior Vice President, Chief Financial Officer, and Treasurer; Kerry Clark, Senior Vice President, Land and Commercial; and Steve Putman, Senior Vice President and General Managing Director. Thank you.
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Joining me on the call from the company are Tom Carter, Chairman, CEO, and President <unk> Senior Vice President Chief Financial Officer, and Treasurer, Gary Clark Senior Vice President land, and commercial and Steve Putman Senior Vice President and General Counsel I will now turn the call over to Tom.
Good morning to everyone on the call and thank you for joining us today to discuss our fourth quarter and full year 'twenty three results.
Thomas L. Carter: I'll now turn the call over to you. Good morning to everyone on the call and thank you for joining us today to discuss our fourth quarter and full year 23 results. We posted strong results with adjusted EBITDA of $125.5 million for the quarter, bringing us to $474.7 million in 2023. We generated total production volumes for the fourth quarter of 41.4 thousand BOE per day. 2% above the upper end of our full year guidance. Royalty volumes for the quarter were 38,900 BOE, where we saw oil volumes trend down in the Bakken and Eagle Ford, but were offset by an increase in Midland Dell. We also saw a modest decrease in natural gas volumes, primarily in Louisiana Hainesville, conforming with natural gas trends in our industry. Yet, we see the glass is half full.
We posted a strong we posted strong results with adjusted EBITDA of $125 5 million for the quarter.
Bringing us to $474 7 million in 2023.
We generated total production volumes for the fourth quarter of 41.4 thousand Boe per day.
2% above the upper end of our full year guidance range.
Royalty volumes for the quarter were 38 9000 Boe.
When we saw oil volumes trend down in the Bakken and Eagle Ford, but were offset by an increase in met on Dell.
We also saw a modest decrease in natural gas volumes, primarily in the Louisiana Haynesville.
Conforming with natural gas trends in our industry.
Yes, we see the glass is half full to date 39 wells have been turned to sales in the Shelby trough under our development agreements with asos.
Thomas L. Carter: Today, 39 wells have been turned to sales in the Shelby Trough under our development agreements with ATHON. We announced in December that ATHON elected to use a timeout provision in our development agreement that specifies that when prices fall below a certain threshold, they may elect to temporarily suspend contractually obligated drilling on our acreage. At this time, we do not expect the timeout will impact the next 12-month cycle for the drilling and completion of ATHON-operated wells that were spud prior to the timeout. ATHON has indicated they may drill additional wells during the timeout period and have actually begun operations on several. We are working closely with Aethon to determine the effect of the time out as we focus on longer-term expectations for production in 2025. We had 63 rigs running on our acreage at the end of the quarter, representing approximately 10% of the US rig count and a reduction of 13 rigs compared to the third quarter.
We announced in December that etan elected to use a time out provision in our development agreement.
Suffice it when prices fall below a certain threshold they may elect to temporary temporarily suspend contractually obligated drilling.
On our acreage.
At this time, we do not expect a time out.
<unk> will impact the next 12 months cycle for the drilling and completion of Etan operated wells that were spud prior to the time out and in fact eight Don.
As indicated they may drill additional wells during the time out period and have actually begun operations onshore.
We are working closely with asos to determine the effects of the time out as we focus on longer term.
Expectations for production in 2025.
We had 63 rigs running on our acreage at the end of the quarter, representing approximately approximately 10% of the U S rig count and a reduction of 13 rigs compared to the third quarter.
Thomas L. Carter: Like most in our business, we are seeing a general slowdown and drilling in the Hainesville and Gulf Coast as a response to lower natural gas, with oil prices remaining around the $70 per barrel range. However, we did see a small increase in Midland, DE, in the Bakken Plate. We previously announced that we were maintaining our 47.5 cents per unit for the last quarter, or $1.90 on an annualized basis, which, as reported yesterday, represents 1.19 times coverage for the quarter. Despite the challenges with natural gas prices, we've been able to maintain a strong balance sheet throughout the year and hold distributions at their highest level since going public. Due to the suppressed price environment, we may be in a position where, at current distribution rates, we could fall below one times coverage, something we likely would not let stand, implying a possible reduced distribution until pricing recovers. In 2022, we mentioned that we expected to grow production through 23 with a target exit rate close to 40,000 BOE per day. And we're able to meet and exceed those expectations.
Like most in our business, we are seeing general slowdown in drilling in the Haynesville and Gulf Coast.
As a response to lower natural gas prices with oil get oil prices remaining at around the $70 per barrel range.
We did see a small increase in Midland, Delaware and the Bakken play trends.
We previously announced that we were maintaining our 47 five cents per unit.
For the last quarter or $1 90 on an annualized basis.
As reported yesterday represents 119 times coverage for the quarter.
Despite the challenges with natural gas prices, we've been able to maintain a strong balance sheet throughout the year and hold distributions at its highest level since going public.
Due to the suppressed price environment, we may be in a position where at current distribution rates, we could fall below one times coverage, something we likely would not let stand implying a possible reduced distribution until pricing recoveries.
In 2022, we mentioned that we expected to grow production through 'twenty three with a target exit rate close to 40000 Boe per day and were able to execute and exceed those expectations as.
Thomas L. Carter: As we enter 2024, there are headwinds, www.thevenusproject.com, due to, but due to the quality of our acreage and no debt on our balance sheet. We adjusted our commercial efforts to be proactive in a down cycle and have included targeted mineral and royalty acquisitions that complement our existing acreage position. In 2023, we acquired non-producing minerals and royalties totaling $15 million.
As we enter 2024 there are headwinds.
But due to the quality of our acreage and no debt on our balance sheet.
We adjusted our commercial efforts to be proactive in a down cycle and have included targeted mineral and royalty acquisitions that complement our existing acreage position.
2023, we acquired non producing minerals and royalties totaling $15 million.
Evan Kiefer: Our strategy in 2024 includes a continuation of targeted acquisitions that support commercial initiatives and provide long-term, accretive growth to our unit holdings. Overall, it's a strong quarter, and despite the challenging commodity price environment, we remain encouraged by the long-term natural gas outlook, as we continue to make progress on strategic initiatives in 24 and beyond. With that, I'll turn it over to Evan. Thank you, Tom, and good morning,
Our strategy in 'twenty four includes a continuation of targeted acquisitions that support our commercial initiatives and provide long term accretive growth to our unit holders.
Overall, it's a strong quarter and despite challenging commodity price environment, we remain encouraged by the long term natural gas outlook.
We continue to make progress on strategic initiatives in 'twenty four and beyond.
With that I'll turn it over to Evan.
Thank you Tom and good morning, everyone.
Evan Kiefer: As Tom pointed out, we had a very good fourth quarter where we reported average daily production of 41.1 thousand DOE per day. For the full year, we generated $474.7 million of adjusted EBITDA from 39.8 thousand DOE per day, which is just above the high end of our full year guidance range. In conjunction with the earnings release, we put out our 2024 guidance yesterday, and as we look forward to the full year 2024, we forecast annual production to be up slightly from 2023 levels. As Tom mentioned in the Shelby Trough, ATHON has indicated their intentions to turn in line, in 2024, the wells that have been spud prior to the timeout provision.
As Tom pointed out we had a very good fourth quarter, where we reported average daily production of $41 1000 Boe per day.
For the full year, we generated $474 7 million of adjusted EBITDA from $39 8000 Boe per day, which is just above the high end of our full year guidance range.
Conjunction with the earnings release, we put out our 2024 guidance yesterday and as we look forward to the full year 2024, we forecast annual production to be up slightly from 2023 levels.
As Tom mentioned in the Shelby trough Asos has indicated their intention to turn in line.
In 2020 for the wells that have been spud prior to the time out provision and we're working very closely with them to determine the long term impact on future production volumes.
Evan Kiefer: And we're working very closely with them to determine the long-term impact on future production volumes. We expect a modest increase in volumes in the East Texas Austin Shock, where we now have 30 new generation multi-stage completion wells that are currently producing as we are working with our operating partners in the area to accelerate activity. Our Permian position is broadly expected to remain in line with 2023 levels as operators continue to focus on capital discipline, but this is offset by an expected decline in the Bakken as that play continues to mature. On the heels of a robust 2022 and 2023, we expect a slowdown in Louisiana Hainesville in response to lower natural gas prices, as evidenced by a recent announcement of rig cuts, as well as some natural production declines on our Lease bonus and other income was $3.8 million for the fourth quarter and $12.5 million for the full year.
We expect a modest increase in volumes in the East, Texas, Austin Chalk, where we now have 30, new generation multi stage completion wells that are currently producing as.
As we are working with our operating partners in the area to accelerate activity.
Our Permian position is broadly expected to remain in line with 2023 levels as operators continue to focus on capital discipline.
But it is offset by expected decline in the Bakken is that play continues to mature on.
On the heels of a robust 2022 and 2023, we expect a slowdown in Louisiana Haynesville in response to lower natural gas prices as evidenced by recent announcements rate cuts as well as some natural production declines on our acreage outside of these core place.
Lease bonus and other income was $3 8 million for the fourth quarter and $12 5 million for the full year.
Evan Kiefer: The fourth quarter included leasing from primarily Haynesville, the Granite Wash, and the Gulf Coast, but we remain encouraged by continued activity in these plays despite the lower price environment. We expect lease bonuses, operating expenses, and production costs for 2024 to be in line with 2023 levels. GNA is expected to increase slightly in 2024 as a result of inflationary costs and our continued efforts to support our ability to evaluate, market, and manage our undeveloped acreage positions to potential operators. In 2023, Henry Hub averaged $2.74 per MMBTU, while our natural gas hedges had a strike price of over $5 per MMBTU, which provided over $80 million of realized hedge gains for the year.
The fourth quarter included leasing for.
Primarily in the Haynesville, the granite wash and Gulf coast, but we remain encouraged by continued activity in these plays despite the lower price environment.
We expect lease bonus operating expenses production cost for 2024 to be in line with 2023 levels.
<unk> is expected to increase slightly in 2024.
Results of inflationary costs, and our continued efforts to support our ability to evaluate market and manage our undeveloped acreage positions to potential operators.
In 2023, Henry hub averaged $2 74 per <unk>, while our natural gas hedges had a strike price of over $5 per <unk>, which provided over $80 million of realized hedge gains for the year.
In 2024, we see those levels move lower to $3 55 per <unk>, while our oil hedges are currently just above $71 per barrel.
We are in our normal range of hedging approximately 60 to 70 plus percent of expected volumes for the rest of the year that will continue to provide support to our cash flows for 2024 due to the recent pullback in pricing.
Evan Kiefer: In 2024, we see those levels move lower to $3.55 per MMBTU, while our oil hedges are currently just above $71 per barrel. We are in our normal range of hedging approximately 60 to 70 plus percent of expected volumes for the rest of the year. That will continue to provide support to our cash flows for 2024 due to the recent pullback in pricing. With the previously announced fourth quarter distribution, we will pay out total distributions of $1.90 per unit for 2023, which represents a 9% increase over 2022. Distributable cash flow for the quarter was $119.1 million, and this resulted in distribution coverage for the fourth quarter of 1.19 times and 1.13 times for the full year.
With the previously announced fourth quarter distribution, we will pay out total distributions of $1 90 per unit for 2023, which represents a 9% increase over 2022.
Distributable cash flow for the quarter was $119 $1 million and results in distribution coverage for the fourth quarter of $1, one nine times and $1 one three times for the full year.
That allowed us to fully pay off the debt at the end of 2022 and remain at a zero debt balance throughout the year.
We currently have $103 million of cash in advance of pain in the fourth quarter distribution.
So now moving on to the common units to the preferred.
As we have discussed on prior calls we have the option to redeem our outstanding preferred units of 105% of par or $21 41 per unit through February 26, 2024, our next week.
Evan Kiefer: That will allow us to fully pay off the debt at the end of 2022 and remain at a zero debt balance throughout the year. We currently have $103 million in cash in advance of paying the fourth quarter distribution. So now moving on from the common units to the preferred. As we have discussed on prior calls, we have the option to redeem our outstanding preferred units at 105% of par, or $21.41 per unit, through February 26th of 2024, or next week. We have not redeemed and do not expect to redeem any units before the redemption window closes, which will not reopen for two years until November of 2025, at a redemption price of 100% of par, or $20.39 per unit. The rate on the preferred units resets in November of 2023 from 7% to the 10-year Treasury plus 550 basis points, or 9.8%.
We have not redeemed and do not expect to redeem any units of further redemption window closes, which will not reopen for two years until November 2025.
At a redemption price of 100% of par or $20 39 per unit.
The rate on the preferred units reset in November of 2023 from 7% to the 10 year Treasury, plus 550 basis points or nine 8%.
As you recall, we also put in place a $150 million unit repurchase program in October of 2023.
This gives us the flexibility to opportunistically buy our common units, which currently trade at a discount to the preferred units redemption price given the low natural gas environment today, and our liquefied natural gas export capacity expected to increase going into 2025 and beyond we remain bullish on our long term gas exposure and unit price.
And so with that I will turn the call open for questions.
Yeah.
Thank you at this time, if you would like to ask a question you may do so by pressing the star one on your telephone keypad.
Operator: As you recall, we also put in place a $150 million unit repurchase program in October of 2023. This gives us the flexibility to opportunistically buy our common units, which currently trade at a discount to the preferred unit's redemption price. Given the low natural gas environment today and the liquefied natural gas export capacity expected to increase going into 2025 and beyond, we remain bullish on our long-term gas exposure and unit price. And so, with that, I will turn the call open for questions. Thank you. At this time, if you would like to ask a question, you may do so by pressing the star 1 on your telephone keypad. If you find that your question has been answered, you may remove yourself from the queue at any time by pressing star 2.
If I missed your question has been answered you may remove yourself from the queue at any time by pressing star tail.
Once again that is star one to ask a question.
And start to move yourself, we will pause for just a moment to simple the question queue.
We'll go first to Tim <unk> with Keybanc.
Yes.
Thank you for taking my questions folks.
I'll just start on the comments.
You mentioned expanding growth strategy into buying minerals in the Gulf coast.
The $15 million is relatively small relative to some acquisitions that your public peers have made in the last couple of years.
I was wondering if you could expand a bit on this.
This growth strategy, how big are you willing to go and then if you could talk you mentioned the Gulf coast. They are non producing can you talk specifically where that is in <unk>.
Your line of sight on the production from that area.
Timothy A. Rezvan: Once again, that is star 1 to ask a question and star 2 to remove yourself. We will pause for just a moment to assemble the question queue. We'll go first to Tim Rezvan with KeyBank. Thank you for taking my questions, folks. I want to start with the comments.
Thanks for the question Tim This is Tom I'll be glad to answer that as follows.
Yeah.
We do.
I acknowledged that $15 million.
Not a needle mover for Blackstone.
And we do expect to.
To continue those efforts and substantially expand upon that number.
Thomas L. Carter: You mentioned expanding your growth strategy into buying minerals in the Gulf Coast. You know, the $15 million is relatively small relative to some acquisitions that your public peers have made in the last couple of years. I was wondering if you could expand a bit on this growth strategy; how big are you willing to go? And then, if you could talk, you mentioned the Gulf Coast; they're non-producing. Can you talk specifically about where that is? Your line of sight on production from that area. Thanks for the question, Tim. I'll be, this is Tom.
Maybe.
10 fold.
And with respect to the type of acquisitions and where those are.
I don't want to say too much because of competitive reasons.
But suffice it to say that our.
Goals here are to buy.
Properties that are not already well overpriced bike in the Permian.
So that our capital will have better running room.
Thomas L. Carter: I'll be glad to answer that as follows. We do acknowledge that $15 million is not a needle mover for Black Stone, and we do expect to substantially expand upon that number, maybe by tenfold. And with respect to the type of acquisitions and where those are, I don't want to say too much because of competitive reasons.
It can be accretive to our production profile.
Okay. So it's fair to think of this as maybe a third leg on the growth stool. In addition to the chalk in the Haynesville agreements.
Well I would tell you that typically speaking we are expanding areas, where we're already.
Thomas L. Carter: But suffice it to say that our goals here are to buy properties that are not already well overpriced, like in the Permian, so that our capital will have better running room and can be accretive to our production program. Okay, so it's fair to think of this as maybe a third leg on the growth stool, you know, in addition to the chalk and the Haynesville agreements. Uh... Well, I would tell you that, typically speaking, we are expanding areas where we're already in place. So, it's probably more an expansion of things that we already own than adding new players. Okay, okay.
And place.
So, it's probably more expansive of things that we already own.
And then adding new plays.
Okay. Okay I appreciate those details.
And then.
I appreciate it Evans comments about.
Not to redeeming the preferreds it would make sense as to where prices are today.
How are you thinking about that that repurchase program you intentionally put that in the release.
And I'm just trying to understand the difference between with that cash on hands it repurchasing shares.
Weakness versus maybe maintaining you seem to indicate you don't want to maintain that 47 five cents per unit.
Evan Kiefer: I appreciate those details, um, and then I appreciated Evan's comments about, you know, not redeeming the preferreds. It makes sense where prices are today. How are you thinking about that repurchase program? You intentionally put that into release.
It's over 100%.
The cash flow I'm, just trying to think how you're.
Thinking about uses of cash given you have no debt between the repurchases and distributions in 2024.
Evan Kiefer: And I'm just trying to understand the difference between having that cash on hand and repurchasing shares, you know, in weakness versus maybe maintaining. You seem to indicate you don't want to maintain that forty-seven and a half cents per unit if it's over one hundred percent, you know, of your cash flow. Just wondering how you're thinking about uses of cash given you have no debt, you know, between the repurchases and distributions in twenty twenty four. Yes, Sam, this is Evan.
Yes, Tim this is Evan.
As we think about overall cash in kind of our debt balances as well.
We don't really like the idea of going below one times coverage for a period of time and effectively having to borrow to support the distributions that said, we also see value in our units over a long term and see that there could be accretion to repurchasing those units at.
Where we're at today at lower gas prices, especially compared to the $21 on the preferred and so overall, we feel more comfortable using some other revolver as it exists to be able to repurchase our common units as opposed to supporting.
Evan Kiefer: As we think about, you know, overall cash and kind of our debt balances as well, we don't really like the idea of going below one-time coverage for a period of time and effectively having to borrow to support the distribution. That said, we also see value in our units over the long term and see that there could be accretion to repurchasing those units at, you know, where we're at today at lower gas prices, especially compared to the $21 on the preferred. And so overall, you know, we feel more comfortable using some of the revolver as it exists to be able to repurchase our common units as opposed to supporting a distribution level that would require coverage to be less than one time.
A distribution level that would require coverage the less than one times.
Okay. So I guess, we'll just stay tuned and see if you start that program with repurchases.
Yes, that's correct.
It's something that.
Okay.
With the current environment, we think it makes sense and something where we have the opportunity to see.
<unk> utilized throughout the year and expect.
More on that to come.
Okay I appreciate the detail I'll hop back in the queue. Thank you.
Evan Kiefer: Okay, so I guess we'll just stay tuned and see if you start that program with repurchases. Yeah, that's correct. You know, it's something that, you know, with the current environment, we think makes sense and something where we have the opportunity to utilize kind of throughout the year. And expect, you know, more on that to come. I'll hop back in the queue. Thank you. We'll go next to Derrick Whitfield with Stiefel.
Thank you.
We'll go next to Derrick Whitfield with Stifel.
Hi, good morning, all and congrats on a strong year end.
Good morning, Gary.
My first question I wanted to focus on your 2024 guidance with the lower gas prices. We are observing at present, how are you thinking about the conversion of the ACI ducks to production in your guidance, meaning are you expecting uniform cadence across the quarters or more.
Second half weighted activity.
Yes Derrick.
Great question so overall.
First off our conversations with asos and the existing docks, we do expect those to come online as they provided there as you would expect with multi pad completions it becomes a little bit lumpy as multiple wells are going to and expected to come online.
Derrick Whitfield: Good morning all, and congrats on a strong year-end. Good morning, Derrick. And my first question: with the lower gas prices we're observing at present, how are you thinking about the conversion of the Atheon Duct? Superduction in your guidance, meaning are you expecting uniform cadence across the quarters or more second half way to that? Yes, Derrick, and a great question. So overall, you know, based on our conversations with ATHON and the existing ducts, we do expect those to come online as they are provided. They're, you know, as you would expect with multi-tad completions, it becomes a little bit lumpy as multiple wells are going to and expected to come online at the same time. What that's going to do is you'll likely see some early on in the year, call it the first or second quarter, and then a little bit more towards the end of the year based off the current expectations that they have provided to us. It's lumpy but relatively uniform across the years at a fair characterization.
At the same time, what thats going to do is youll likely see.
Some earlier on in the year call. It the first and second quarter, and then a little bit more towards the end of the year.
Based off the current expectations that they've provided to us.
So lumpy, but relatively uniform across the year is that a fair characterization.
Yes.
Okay.
And then shifting over to the competitive landscape, we've seen considerable M&A across the upstream sector over the last few years.
Only limited amounts of activity in the minerals sub sector.
With that said what are your thoughts on the impact E&P consolidation could have on your business, namely Chesapeake southwestern.
And.
If you are expecting to see greater consolidation within the minerals sector.
Yes. So this is Kevin and I'll kind of hit on the operator consolidation first then yes, I think overall consolidation within the industry on the operator side could be.
Evan Kiefer: Yeah. And then shifting over to the competitive landscape, we've seen considerable M&A across the upstream sector over the last two years, but only limited amounts of activity in the mineral subsectors. With that said, what are your thoughts on the impact EMP consolidation could have on your business, namely, Chesapeake Southwestern, and if you're expecting to see greater consolidation within the mineral sector?
Beneficial I think specifically thinking about comps.
About the southwestern deal.
Benefits that can be gained through operator efficiencies cost and everything that I think will trickle down essentially benefit on the mineral owner side as.
Evan Kiefer: Yeah, so this is Evan, and I'll kind of hit on operator consolidation first. And, you know, I think overall consolidation within the industry on the operator side could be beneficial. I think, you know, specifically thinking about comps or thinking about the Southwestern deal, there's benefits that can be gained through operator efficiencies, costs, and everything that I think will trickle down and especially benefit the mineral owner side as additional development could persist. Now, on the other side of that, there's capital discipline, and I know Diamondback Endeavor has indicated possibly rig cuts and maybe a little bit more to what I would assume is going to So, I think overall, you know, we're still kind of waiting to see how everything ultimately transactions and how that kind of post-transaction world looks. But I think it's a reasonable level.
Additional development could persist now on the other side of that there is capital discipline I know diamondback endeavor as indicated.
Possibly a rate cut and maybe a little bit more to what I would assume it's got a flatter production.
So I think overall.
We're still kind of waiting to see how everything ultimately transaction and how that post transaction world looks but I think at.
A reasonable level, it's probably neutral on the moderate to low growth story, particularly in the Permian.
Overall kind of efficiencies to be gained on the gas side, particularly in the haynesville.
Keith.
Yes.
And just on <unk>.
More of the minerals consolidation side of the equation and what are your thoughts on that.
Okay.
This is Gary Clark. Thanks for the question I think on.
In the mineral space just on a relative basis.
So much smaller pool, but there has been.
Significant consolidation over the last.
Terri Clark: It's probably neutral on the, you know, moderate to low growth story, particularly in the Permian, and, you know, overall kind of efficiencies to be gained on the gas side, particularly on the Haynesville and just on. More of the minerals consolidation side of the equation; what are your thoughts on that? This is Terri Clark. Thanks for the question. I think in the minerals space, just on a relative basis, of course, they're a much smaller pool.
A couple of years just.
Off the top of my head the city O'bregon transaction from last year.
And to touch back a bit on the operator consolidation.
Impact to us.
Always monitoring is the.
Yes.
Come about what the specific impact is to ask I'm trying to quantify that.
And I think.
For the year.
Terri Clark: But there has been some significant consolidation over the last couple of years. Off the top of my head, the City of Obregon transaction from last year, and to touch back a bit on the operator consolidation and its impact on us, we're always monitoring as these deals come about, what the specific impact is to us and trying to quantify that, and I think for the Chesapeake and Swin. We don't expect a material impact on us from based on that transaction. But of course, as I said again, we're always looking at those operator consolidations and understand that capital can shift from priority projects for one company and as they form a different company, that could shift around, and that's what we are monitoring on that. Front. I don't, as far as the outlook on mineral consolidation is concerned.
The Chesapeake can win.
Consolidation.
We don't expect a material impact to us.
Based on that transaction.
But of course.
Yes.
As I said again, we're always looking at those operator consolidations would understand that capitals shift from priority projects or one company in a form 8-K.
It's a company that can that can shift around.
And that's what we are.
Monitoring on that.
Brian.
I don't as far as outlook on mineral consolidation.
There is nothing.
Out there that we see at this point that we're anticipating.
Peyton.
But.
So I think that's all we really have to share on that.
Kind of seeing the same thing that.
John might be seen in the market.
Terrific. Thanks for the added color.
Sure.
This time I would like to turn the call back over to Tom Carter for any closing comments or additional remarks.
Well. Thank you all for joining the call today, and we look forward to speaking with you again in 90 days or so.
Terri Clark: There's nothing, you know, out there that we see at this point that we're anticipating, but, So I think that's all we really have to share on that is just that we're kind of seeing the same things that y'all might be seeing in the market. Terrific. Thanks for the added color.
Once again, ladies and gentlemen that does conclude today's call. Thank you for your participation you may disconnect at this time.
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Uh-huh.
Thomas L. Carter: And at this time, I'd like to turn the call back over to Tom Carter for any closing comments or additional remarks. Well, thank you all for joining us today, and we look forward to speaking with you again in 90 days. Once again, ladies and gentlemen, that does conclude today's call. Thank you for your participation. You may disconnect at this time. Tyler Wright, Jason Momoa, N'Kehlani Tsai Sampson, Elvin Gross, Sam Wessel, Simon Bailey, Jeffrey Marsden, Cinema gateway JD Argo Neil Armstrong Bruceprit Dan Petty consciousness The first in the world A song Turn our world Inside Premier Martha ga Isaac Schubert Stephen Bukowski A rent a Ve ranking of three officers, Bye! BF-WATCH TV 2021
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