Viper Energy, Inc. Q4 FY2024 earnings call

• Fourth quarter concluded a landmark year for Viper with strong organic production growth on legacy assets and successful execution of acquisition strategy. • Upcoming drop-down transaction with Diamondback is unique with alignment to Diamondback's development, pro forma Viper expects ~75% interest in Diamondback's completions over next five years. • Recently closed Quinn Ranch acquisition. • Q1 2025 production guidance 30,000-31,000 bbls oil per day; post-drop down in Q2 2025, expected run rate 48,000 bbls oil per day; 2026 production expected to increase to ~31,000 bbls oil per day. • Viper sees itself as a differentiated investment with zero capital and operating costs alignment, positioned to be consolidator in Permian Basin minerals market. • Resource expansion story is compelling, with returns on deeper intervals competitive with traditional zones, and leasing activity tailwinds expected in next two years.

• Initiated average daily production guidance for Q1 2025 of 30,000 to 31,000 barrels of oil per day. • Upon assumed closing of drop down in Q2 2025, expects run rate daily average oil production of 48,000 barrels of oil a day. • 2026 production expected to increase to approximately 31,000 barrels a day up from ~27,000 in 2025. • Expect at least $50 million of upside to Viper from cash flow perspective at $70 oil in 2026. • Goal to reach $1 per share of distributable cash flow each quarter on normalized price basis.

Q: Neal Dingmann asks about the Double Eagle transaction and potential upside for Viper.

A: Kaes Van't Hof responds that they're working out details and timing, expects at least $50M cash flow upside by 2026 at $70 oil, and Austin's team is actively looking at opportunities in Reagan County.

Q: Neil Mehta asks about payout guidance and parameters.

A: Kaes Van't Hof says 75% of free cash returns is high, leaves 25% for deals; Travis Stice mentions smaller drop-down opportunity from Double Eagle but exciting rating counting opportunity from accelerated development.

Q: Kalei Akamine asks about data center plans and surface rights.

A: Kaes Van't Hof says surface is smallest part of data center value chain, market may view differently, but surface likely stays in Diamondback for now to avoid intercompany issues.

Q: Paul Diamond asks about operational profile and balance sheet.

A: Kaes Van't Hof says mineral business can take more leverage but market/ratings not there yet; Travis Stice talks about leasing activity and surface ownership.

Q: Derrick Whitfield asks about deeper intervals and leasing activity.

A: Kaes Van't Hof says resource expansion story is compelling, returns on deeper intervals competitive; Travis Stice mentions leasing activity and lease bonus as part of story.

Q: Tim Rezvan asks about repurchases and M&A.

A: Kaes Van't Hof says repurchase plan still there, capacity exists; talks about M&A opportunities and unique structure with opco units.

Q: Leo Mariani asks about M&A opportunities and dividend accretion.

A: Kaes Van't Hof says Viper is largest public mineral holder in Permian, significant opportunity ahead; expects dividend accretion with drop down and organic growth.