Texas Pacific Land Corporation Q4 FY2025 earnings call

• Fourth quarter was excellent finish to 2025 with quarterly records set for oil and gas royalty production, water sales volumes and produced water royalties. Excluding royalties acquisition, fourth quarter oil and gas royalty production grew 23% y-o-y. Water sales volumes exceeded 1 million bbl per day for first time, grew 36% y-o-y. Produced water royalty volumes grew 22% y-o-y. Full fiscal year 2025 set annual records across major operating milestones and consolidated metrics. • Made progress with next-generation opportunities: strategic investment into Bolt Data & Energy, data center projects with developers, 10,000 bbl per day R&D desalination facility in Orla, Texas nearing completion with new process implemented to reduce time and costs, plan to invest $20 million on co-location equipment at Orla facility for waste heat capture and data center cooling. • Exited 2025 with $145 million cash on balance sheet, 0 debt, $500 million undrawn credit facility. • Capital expenditures in 2025 were $66 million, low end of original guidance. • As of quarter end, had 5.6 net permitted wells, 9.8 net DUCs, 4.0 net completed but not producing wells, totaling 19.5 net line-of-sight wells. • Operator efficiencies improving, well laterals getting longer, wells completed on TPL royalty acreage average 8% longer than prior year, first quarter with new permits, spuds, completions and new PDP wells all having average lateral lengths over 11,000 feet. • Announced event for TPL shareholders for office and water field visit in Midland, Texas on May 18, 2026.

Fourth quarter set quarterly records for oil and gas royalty production, water sales volumes and produced water royalties. Excluding royalties acquisition, fourth quarter oil and gas royalty production grew 23% y-o-y. Water sales volumes exceeded 1 million bbl per day for first time, grew 36% y-o-y. Produced water royalty volumes grew 22% y-o-y. Full fiscal year 2025 set annual records across major operating milestones and consolidated metrics. Consolidated revenues in fourth quarter 2025 were approx $212 million, consolidated adjusted EBITDA was $178 million, adjusted EBITDA margin 84%, free cash flow $119 million. Full year 2025 generated record free cash flow of approx $498 million, 8% y-o-y increase. Full year performance benefited from higher daily oil and gas royalty production (29% y-o-y increase), higher water sales daily volumes (4% increase) and higher produced water royalty daily volumes (25% increase).

• Anticipate capital expenditures for 2026 to be approximately $65 million to $75 million, with $20 million allocated towards waste heat capture and data center and power generation co-location potential for freeze desalination facility, remaining balance for water sales business for electrification, equipment and supply improvement and maintenance. • Believes Permian still has ample DUC inventory to drive completion pacing to support production via continued discretionary DUC draws with at least a year or more of runway before industry would need to begin adding rigs. • Focused on maximizing long-term intrinsic value per share, with resilient business and pristine balance sheet.

Q: Congrats on strong financial and operational update, thoughts on opportunity set for power and data center development for TPL beyond Bolt?

A: Opportunity set has evolved, have a few projects working on, some Bolt related, some not, long-term goal is to build multiple multi-gig energy campuses, commercial negotiations ongoing.

Q: Thoughts on reasonable numbers for water revenue with Bolt's ambition of 10-gigawatt data center campus?

A: Varies with facility design, but with certain designs numbers are reasonable, usage depends on facility design, used to moving a lot of water, opportunity substantial.

Q: Thoughts on desalination process efficiencies and power intensity?

A: Overall goal in water desal is to reduce energy consumption, waste heat capture is a way to bring kilowatt per hour per barrel treated down, waste heat is almost free energy.

Q: Exposure to rare earths activity in Hudspeth County?

A: Have a couple of exploration projects going on, early stages, finding seem promising so far.

Q: Color on ROFR to supply water for Bolt partnership, how done?

A: Likely a combination of source water network, treated desal water, depends on facility design.

Q: Capacity to ramp treated water for scaling up data centers?

A: Never going to have feedstock shortage of water usage, but need to look at eventual water needs and economic return for capital investment.

Q: Updates on Bolt agreement, commercial partnerships and revenue timing?

A: Eric Schmidt's goal is to get to 1 gig swiftly with 10-gig campus ultimate goal, conversations progressing swiftly, hope to announce stuff this year or first half of year.