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Overview of Kimbell Royalty Partners, LP
Kimbell Royalty Partners, LP (NYSE: KRP) is a Fort Worth, Texas-based company specializing in the ownership and management of mineral and royalty interests in oil and natural gas properties. Operating as a variable rate master limited partnership (MLP), Kimbell's business model is centered on acquiring and holding rights to oil and gas production across the United States, allowing it to collect royalty payments from operators extracting resources from its acreage. This asset-light approach enables Kimbell to benefit from production revenues without bearing the operational risks and capital expenditures associated with drilling and extraction.
Extensive Geographic Footprint
Kimbell's portfolio comprises mineral and royalty interests in over 17 million gross acres across 28 states, making it one of the largest owners of such assets in the U.S. The company has a presence in every major onshore basin, including the Permian Basin, Mid-Continent, Appalachian Basin, Eagle Ford, Bakken/Williston Basin, DJ Basin/Rockies/Niobrara, and Terryville/Cotton Valley/Haynesville. This broad geographic diversification mitigates risks associated with localized market fluctuations and enhances exposure to a variety of resource types, including oil, natural gas, and natural gas liquids (NGLs).
Revenue Streams and Business Model
Kimbell generates revenue primarily through royalty payments tied to the sale of oil, natural gas, and NGL production. These payments are made by operators who extract resources from Kimbell's acreage. The company's interests span over 130,000 gross wells, with approximately 51,000 wells located in the prolific Permian Basin. This diversified portfolio ensures a steady stream of income while reducing dependency on any single operator or basin. Additionally, Kimbell benefits from lease bonuses, which are payments received when operators secure drilling rights on its acreage.
Strategic Positioning and Competitive Advantages
Kimbell is uniquely positioned within the highly fragmented U.S. mineral and royalty sector, which is estimated to represent a market opportunity exceeding $700 billion. The company has established itself as a leading consolidator, leveraging its financial resources, technical expertise, and industry relationships to acquire high-quality assets. Its focus on acquiring properties with existing production, undeveloped drilling inventory, and active rig counts ensures both immediate cash flow and long-term growth potential.
Operational Highlights
As of the most recent data, Kimbell's acreage hosts approximately 87 rigs actively drilling, representing about 15% of all land rigs in the continental United States. The company also maintains a robust inventory of drilled but uncompleted wells (DUCs) and permitted locations, providing visibility into future production. This operational activity underscores the resilience and productivity of Kimbell's asset base.
Risk Management and Financial Discipline
Kimbell employs a disciplined financial strategy, allocating a portion of its cash flow to reduce debt while maintaining consistent distributions to unitholders. This approach enhances financial stability and positions the company to capitalize on acquisition opportunities. Additionally, its reliance on external operators for production introduces a degree of risk, which Kimbell mitigates through diversification across multiple operators and basins.
Industry Significance
Kimbell plays a vital role in the energy sector by providing operators with access to mineral and royalty interests, thereby facilitating resource extraction and energy production. Its asset-light model and focus on high-quality basins make it a compelling entity within the oil and gas industry.
Conclusion
In summary, Kimbell Royalty Partners, LP stands out as a leading owner of mineral and royalty interests, offering investors exposure to the oil and gas sector's revenue streams without the operational risks of direct production. Its expansive geographic footprint, diversified portfolio, and disciplined financial management underscore its position as a key player in the U.S. energy landscape.
Kimbell Royalty Partners (NYSE: KRP) announced a cash distribution of $0.37 per common unit for Q4 2021, representing 75% of the projected cash available for distribution. This payment is scheduled for February 7, 2022, to unitholders on record as of January 31, 2022. Kimbell will allocate the remaining 25% to reduce borrowings under its credit facility, having already reduced its debt by approximately $44.5 million since May 2020. Kimbell owns interests in over 122,000 wells across 28 states, emphasizing its robust position in the oil and gas sector.
Kimbell Royalty Partners, LP (NYSE: KRP) announced its fourth quarter 2021 financial results will be released on February 24, 2022, before market opening. A conference call is scheduled for the same day at 10:00 a.m. Central to discuss the results, which will be broadcast live online. Kimbell, based in Fort Worth, Texas, owns mineral and royalty interests across over 13 million acres in 28 states, including more than 121,000 gross wells and 46,000 wells in the Permian Basin.
Kimbell Royalty Partners (NYSE: KRP) has completed its acquisition of mineral and royalty interests for approximately $57 million. The transaction was financed through a public offering of common units and borrowings. Kimbell expects the acquisition to start generating cash flow from November 1, 2021, with production rates of 700 Boe/d from over 26,000 wells. Additionally, the company redeemed all 25,000 Series A Preferred Units, enhancing its balance sheet and reducing capital costs. The acquisition is anticipated to boost distributable cash flow per unit.
Kimbell Royalty Partners, LP (NYSE: KRP) announced the pricing of its public offering of 3,750,000 common units at $14.00 each, totaling approximately $52.5 million in gross proceeds. The offering is set to close on November 15, 2021. Proceeds will be used to fund a cash purchase for the acquisition of oil and natural gas mineral interests and to repay borrowings under its revolving credit facility. An option for underwriters to purchase an additional 562,500 units is also included.
Kimbell Royalty Partners, LP (NYSE: KRP) has initiated a public offering of 3,750,000 common units, with a potential overallotment option for an additional 562,500 units. The proceeds will partially fund a pending acquisition of oil and natural gas interests and cover related expenses. Any remaining funds will be used to repay borrowings under its credit facility. The offering is managed by Citigroup and Raymond James. Kimbell holds mineral and royalty interests across 13 million gross acres in the U.S., significantly enhancing its asset portfolio.
Kimbell Royalty Partners, LP (NYSE: KRP) has announced a $57 million cash acquisition of mineral and royalty interests from an undisclosed seller, set to close in Q4 2021. The acquired assets produced 700 Boe/d as of November 1, 2021, and include over 26,000 gross producing wells across major U.S. basins, enhancing Kimbell's production to 14,783 Boe/d. The acquisition is expected to be immediately accretive to cash flow per unit and supports Kimbell's strategy of consolidating its mineral and royalty interests. The transaction financing will involve an underwritten public offering and borrowings from a credit facility.
Kimbell Royalty Partners (NYSE: KRP) reported strong Q3 2021 results, with daily production hitting 14,083 Boe, a 1% increase from Q2 2021. Revenues rose 23% to $47.6 million, while net income surged 101% to approximately $7.5 million. The cash available for distribution reached $0.50 per unit, up 22%. Kimbell's debt stood at approximately $192.7 million, with plans to redeem Series A Preferred Units in Q1 2022. The company affirmed its 2021 guidance, buoyed by rising commodity prices and a 20% increase in drilling rigs.
Kimbell Royalty Partners (NYSE: KRP) announced a cash distribution of $0.37 per common unit for Q3 2021, representing 75% of projected cash available for distribution. The payout date is set for November 8, 2021, for unitholders of record by November 1. The remaining 25% will be used to reduce outstanding credit facility borrowings, totaling $36.9 million paid down since May 2020. Notably, average crude oil and natural gas prices rose by 6.9% and 48.3%, respectively, in Q3 compared to Q2, contributing to Kimbell’s cash yield of 9.7%.
Kimbell Royalty Partners (NYSE: KRP), a major player in oil and natural gas royalty interests, announced its third quarter 2021 financial results will be released on November 4, 2021, before market opens. The company, which has interests in over 97,000 gross wells across 28 states, will host a live conference call at 10:00 a.m. Central to discuss these results. Interested parties can join via phone or webcast from Kimbell's Investor Relations page.
Kimbell Royalty Partners (KRP) reported strong Q2 2021 financial results, achieving a run-rate production of 14,011 Boe/day, a 2% increase from Q1 2021. Revenues rose 7% to $38.8 million, with net income of $3.7 million, up from $0.5 million in Q1. Record Adjusted EBITDA reached $28.1 million. The company redeemed 55% of its Series A preferred units, simplifying its capital structure. Tax benefits are expected, with no federal income tax from 2021 to 2027 for common unitholders. A cash distribution of $0.31 per unit was announced, reflecting a 15% increase.
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