BSM - Earnings call transcript Q1 2024 | Black Stone Minerals, L.P.

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Operator

Good day, and welcome to the Black Stone Minerals First Quarter Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I'd now like to turn the call over to Mark Meaux, Director of Finance. Please go ahead.

Mark Meaux

Thank you. everyone. to morning Good joining Minerals by Conference First for for Call. or Black Stone Quarter us you phone either online Thank XXXX Earnings our night. Today's be earnings recorded being which website on release, last call the along issued and was with is available will

I'd assumptions advise you differ start, risks performance. statements regarding making our will that our about that to results this expressed our in the our from involve to during future materially statements call like actual may plans, we we be implied Before forward-looking expectations results statements. cause and These or forward-looking

a should the information press cautionary For XXXX Factors these of in from release discussion our risks, risk refer to our statements forward-looking you section the and yesterday of about XX-K.

financial in yesterday, release are non-GAAP metrics those these our website we We are GAAP at Reconciliation directly of about in to measures evaluating press be to performance. and our may useful from the most found measure non-GAAP www.blackstoneminerals.com. on which described measures can comparable certain believe our information that other refer earnings

and Vice Vice Chairman, -- Chief the I'll I'll and Joining Carter, call are to Treasurer; Tom the Financial Kiefer, over and Clark, call President, President; the Tom. President Evan Carrie and Senior company General on call Senior Officer; Officer Senior from Commercial Vice me Steve now CEO Putman, Chief President, Counsel. now turn

Tom Carter

per volumes discuss decrease everyone, the Good for production adjusted of Mark. of first of fourth morning, million. of and thank from We morning income and posted a BOE quarter. 'XX with our quarter first We generated quarter EBITDA X% you us a to volumes. million you, XX.X $XX.X Thank net joining the day, quarter for this total $XXX.X good

Gulf where diversified production area. basins, see natural were Fayetteville, in tranche. natural continue quarter Bakken were continue Oil BOE and in in but Coast, a despite other Lance Midland volumes the partially these Delaware Mesa and volumes quarter new increased illustrate the trended gas for Factors the noncore gas day. contribute by fourth resilient portfolio, the offset to like challenges, down we And to increase year-over-year. of the from ongoing to benefit in the that an volumes Verde per Royalty plays additions the XX,XXX

strategic Our mix value its Black long-term as to everyone that significant for Haynesville/Bossier, continues unique asset me With growth is just engine to significant a a add on which turn advantage focus that, Stone a long-term to consistently let unitholders. and is Black the knows, Stone. --

December our invoked in one the for a agreement, In seize of provision activity period operators allow which them under the announced Trough, of our to Shelby a "time-out" that of we joint time. exploration would

Trough, and good have in We have we in XTO, And [ Aethon, Southwestern, Chesapeake, Milestone [ ], others. the being Wave group Louisiana, Pine ], of operators Exco and in addition, Comstock a Shelby others.

So portfolio we've got operators. of a great

under operations The time-out, longer however, and clock contract. our drilling that agreement qualify either that is that joint of a activity levels for This and operator will in the suggests our declared is X on under back expected alternatively operator continue wells no or not out contractual to time there. exploration minimums is these the currently

One in up. structure to agreements of environments respect This I'm the on just various environments here, with scrolling of second our properties. strength joint price underscores our the activity -- exploration different just

pressures cubic encouraged basin, even ranging by we're lot the new though the of operators areas. in anywhere XX anticipate these a to million not we low to continue being to volumes XX,XXX are to added slowing 'XX, through very continually in excess work results do and in a the material impact positive closely in down of with of Haynesville area million 'XX are all And from in We day the wells XX there that operators believe our on We in [indiscernible]. performance a our environment. response in in feet price

inventory to that to an net are We XX LNG with up believer that in acreage 'XX operators, Shelby our undeveloped XXX,XXX-plus addition Trough forward to a increases natural in, the just interest and look coming In markets in position with existing and resource and what to firming in beyond estimated an is additional into Tcf Black of has demand with expanding. the gas of acres the Stone ground. existing we coming export

lower some we expect our response as said, meaningfully involved not prices, have in gas this to some been to do to of be our we do But natural -- challenging In curtailment. not operators we volumes.

persist, commodity our prudent continue focus balance price sheet strategy As the employing management. to long-term on challenging we while

has several aimed to expanding of footprint to existing been 'XX, Coast centered our we develop our for in expanded areas. supplement are asset program has base our Shelby long-term initiatives quarter adder organic and in existing years focus to efforts, Starting and Our been Trough acquisitions significant a around the the production. grassroot that including Gulf targeted that fourth those

efforts 'XX These we exit we a a of expected have with that In different XXXX, cycles. targeted on those expectations. to closed XX,XXX able rate weather execute and us per allowed grow lot day to BOE mentioned to we're production through

natural to high distribution XXXX is our gas the we the through liquefied have 'XX, that to production Now set prices. drive growth back alongside level natural plan water expected demand by to in higher mark grow gas

just to to this and program to We We've in of worth regions. acquired acreage forward. do 'XX. of capitalize Coast a nonproducing existing add over our going $XX intend since and fraction intend we portfolio added development million assets our meaningfully Gulf And these is what on September

by a And natural price the despite long-term outlook. challenging Overall, strong environment, gas quarter. a we're commodity it's encouraged

progress I'll Shelby to Trough over. with working bringing towards key operators continue our to make take additional initiatives With strategic Evan We and and operators to that, ask area. into our grow

Evan Kiefer

Tom, you, to good and Thank morning everyone.

from of and quarter adjusted the mineral BOE XX,XXX and net royalty and for $XX.X was quarter, day per resulted production $XXX.X day million BOE out, As This volume. the Tom per of in down EBITDA quarter. a generated first had for in our We first we income pointed positive production quarter total last first million. X% of XX,XXX which

We were distribution annualized previously $X.XX that we our unit per or reducing an basis. on to announced $X.XXX

As which distributable gas reported curtailments the production opportunity. $XX.X our elected wells coverage the coverage million, the towards represents yesterday, first X.XXx prices, natural to utilize excess was the for quarter delays quarter. turning quarter in the Board distribution of in reduce for growth flow and cash on production, Due to challenges the and

lot gives continue We to a a us of through these dynamic have balance sheet cycle. that flexibility strong very market

million have and interest our nonproducing excess utilizing quarter acquisitions, mineral and the $XX to outstanding first to of on revolver. these cash we continue As have Tom mentioned, borrowings royalty no we that acquired from approximately supplement

to facility production at $XXX last for The gas of and credit $XX guidance our approximately seeing environment reflects while of we revolving this million. borrowing week, that the reaffirmed at payment As later in million, that $XXX cash the prior hold the also that's we're had natural announced elected commitments updated distribution base million challenges Yesterday, of month. we price today. we was to the

X% between online, range continued to response we and production approximately production to XX,XXX BOE a for BOE slowdown XX,XXX year day In guidance by lowering per are new XXXX production day. bringing in and full our the curtailments per

production and curtailing delay the expected Shelby until later additional initial when number year has indicated prices are improve. in has of started As Tom a to to plans the Aethon Trough properties on this mentioned, properties

Henry at heels is XXXX of hedges $X.XX we first approximately off natural million. position Comparing to of natural Hub at MMBtu the MMBtu. quarter, had per MMBtu, approximately Now per a we gas realized of XXXX, an that for benefited hedge price from our $X.XX where at gain gas over average $X $XX the per

of the XXXX remainder our insulate help cash pricing for hedged expected volatility. XX% near-term volumes of from that flows over have will any continued our We

both and add to created growing will We position the Overall, distribution that but throughout of have we headwinds high lower positive the the to some its a XXXX previous we continued on crude commercial quarter production natural continued for gas focused hedge our despite watermark. gas year. of returning by strategy to environment continue the to and remain remainder had for

to year acquisitive next plans. This environment those execute in we to continue be unitholders benefit on our opportunity a as of very provides beyond the unique the and selectively to

questions. that, And call open with we'll the to up so

Operator

[Operator Derrick go Whitfield to first Instructions] with We'll Stifel.

Derrick Whitfield

With For price some guidance? throughout production my XXXX lower guidance, curtailments first you're what guidance. you question, think, assumption not might on your material could of clearly your your as thinking help as frame how I And is wanted focus to while dependent and cadence in on the the your about year.

Evan Kiefer

Evan, Derrick, with Yes, that. start I'll this is and

the call What getting it, the out opposed up second to The production they bit next whenever is, -- in and $X third there'll only interest Aethon of the just from in more has intend in we're public on delaying And to fourth those wells $X.XX. quarter is as those really a on the move as is things through has closer at, turning quarter. looking online average, I at well. looking as guidance, be $X. Chesapeake to pricing well to little the average not start that at you indicated think said we're levels, wells closer come and what right as we're quarter now, quarter whether it's One

come second half quarter at and to that that current second the third our through start of update to year. kind into So level assuming that targeting back the online, of really third curtailments guidance they the really contemplate into then the quarter

Derrick Whitfield

to And maybe then make That sense. shifting activity. acquisition over

I seeing to environment guys of the would or September, frame been this and over You've as been million depth acquiring last least at minerals time. beyond in the you help active have that you're to you while oil what's Could opportunity in prefer disclosed? as gas, know since guys it's location kind of whether you the at not noted, $XX the disclose opportunity competitive the

Tom Carter

today that while acquisitions to where we late the on that we mineral a of beyond 'XX not areas. think in acquisitions out with already The And everybody in as people much expensive, in that. acquisitions expensive than and a that trying return on acquisition industry, answer is significantly to in the see to is, nearly but it wade are and I'll we about significant the doesn't the what not around And be. contiguous extremely else acre our -- investments lot to for in made too that have and Blackstone areas where going on where that positions might a that other take where Permian lot Permian royalty I'm imagination unlike are strip of other those trying focusing have will figure we are is. higher are in of say

your that hope I question. answers So

Derrick Whitfield

could you offer terms does. guys you just of then have what It committed there? And color beyond depth today, to in the any

Tom Carter

to how expect meaning much Yes, do we spend?

Derrick Whitfield

Or landscape how spend you're much seeing? competitive the could you given more

Tom Carter

I would this that answer way.

we I since multiple think we've so spend on expect we got active but robust 'XX. price, and And pretty now as been right of to what on, budgeted we're we've program and going a that a probably have depends as far. spent

Derrick Whitfield

certainly you to forward That's updates I terrific look color. from the in future. And guys

Tom Carter

we bit say about as we'll soon more, little more get As a it.

Operator

Instructions] We'll next with to Markets. KeyBanc Martini [Operator John Capital go

Unknown Analyst

First on question is distribution.

coverage more the You hedges maintain pay place? forward, enough trimmed than given going looking current it just to you it. $X.XXX in for this Are XQ and distribution had gastric in to

Evan Kiefer

great had to help that that the of a really support the some we the higher elected Yes, effort. first question. was acquisition John, coverage And that's quarter, with in

second to curtailments, we the strength it fall low lot year kind how we see and the Now expect going would dependent do strip Do continues. delays coverage to indicate. of in on the be half really given continue a of gas future. the that long environment production is of the And the as in the

And strip and the so to persists. as a we as current in is maintain do that distribution it. always, level there's environment like the expect to some setting openness But achievable where

Unknown Analyst

Okay. we had. It's all That's there. helpful. appreciate actually color the We

Evan Kiefer

Thank you, John. Great.

Operator

appears this Carter closing floor over additional for like have Tom back at or we turn And it any no time, Mr. to comments. the to further I'd questions.

Tom Carter

we're what to of I that very today. perform you best just sort but bumpy thank in many and in right. the down years thank are and And to position by we're excited for pretty in today. our the be industry, there. X roads coming saying next position joining run you Well, summarize into all us Black for us one to or road see All trying we about Stone of joining really much the X to the we

Operator

call. again, that conclude you. Thank Once your and ladies participation. for gentlemen, will Thank today's you

You this may disconnect at time.

Black Stone Minerals (BSM) 7 May 242024 Q1 Earnings call transcript