Texas Pacific Land Corporation (TPL) Q3 2022 Earnings Call Transcript

For the period ending September 30, 2022

November 3, 2022 8:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning, and welcome to Texas Pacific Land Corporation's Third Quarter 2022 Earnings Conference Call. This conference call is being recorded.

I would now like to introduce your host for today's call, Shawn Amini, Vice President, Finance and Investor Relations. Please go ahead.

Shawn Amini

Good morning. Thank you for joining us today for Texas Pacific Land Corporation's third quarter 2022 earnings conference call. Yesterday afternoon, the company released its financial results and filed its Form 10-Q with the Securities and Exchange Commission, which is available on the Investors section of the company's website at www.texapacific.com.

As a reminder, remarks made on today's conference call may include forward-looking statements. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those discussed today. We do not undertake any obligation to update our forward-looking statements in light of new information or future events. For a more detailed discussion of the factors that may affect the company's results, please refer to our earnings release for this quarter and to our most recent SEC filings.

During this call, we will also be discussing certain non-GAAP financial measures. More information and reconciliations about these non-GAAP financial measures are contained in our earnings release and SEC filings. Please also note, we may at times refer to our company by its stock ticker, TPL.

This morning's conference call is hosted by TPL's Chief Executive Officer, Ty Glover; and Chief Financial Officer, Chris Steddum. Management will make some prepared comments, after which, we will open the call for questions.

Now I will turn the call over to Ty.

Ty Glover

Thanks, Shawn. Good morning, everyone, and thank you for joining us today.

Third quarter 2022 represents another well-rounded performance across the TPL business. Consolidated revenues increased 8% and net income increased 9% sequential quarter-over-quarter, driven by growing oil and gas royalty production, outstanding source water and produced water performance and continued strong SLEM activity.

Royalty production for the third quarter of approximately 23,400 barrels of oil equivalent per day is a new corporate record. On the water side, during this most recent quarter, we sourced and treated over 40 million barrels of water. Since the water business inception, TPL has sourced or treated over 500 million barrels of water, which we estimate is responsible for over 1,000 new well completions in the Permian, with many of these on TPL royalty acreage.