Texas Pacific Land Corporation announced the closing of a significant acquisition of Permian oil and gas mineral and royalty interests for $286 million in cash. These interests span approximately 7,490 net royalty acres, primarily located in the Midland Basin across Martin and Midland counties. Over 80% of the newly acquired acreage is adjacent to or overlaps TPL's existing surface and royalty holdings.
The acquired assets are largely operated by premier upstream companies, including Exxon Mobil Corporation and Diamondback Energy Inc., which operate approximately 66% of the acreage. These assets currently produce about 1,300 barrels of oil equivalent per day, with liquids comprising approximately 78% of this volume. TPL anticipates a strong line of sight to near-term development and production growth from these new holdings.
CEO Tyler Glover stated that the acquisition simultaneously high-grades TPL's legacy oil and gas royalty footprint, increases cash flow and earnings per share, and strengthens the company's growth profile. The company expects next-twelve-months production from these assets to generate a double-digit cash flow yield. This strategic move enhances TPL's free cash flow per share, providing incremental flexibility for shareholder returns.
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