DORCHESTER MINERALS LP
For the period ended Sep 30, 2024. Filed Oct 31, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Oct 31, 2024
DMLP$27.53+1.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-01.
0001437749-24-024292
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-10-31.
0001437749-24-032791
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 39 previous paragraphs and 44 current paragraphs.
25 unchanged; 14 reworded; 5 added; 0 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (5)
Current report
On September 30, 2024, pursuant to a non-taxable contribution and exchange agreement with West Texas Minerals LLC, a Delaware limited liability company, Carrollton Mineral Partners, LP, a Texas limited partnership, Carrollton Mineral Partners Fund II, LP, a Texas limited partnership, Carrollton Mineral Partners III, LP, a Texas limited partnership, Carrollton Mineral Partners III-B, LP, a Texas limited partnership, Carrollton Mineral Partners IV, LP, a Texas limited partnership, CMP Permian, LP, a Texas limited partnership, CMP Glasscock, LP, a Texas limited partnership, and Carrollton Royalty, LP, a Texas limited partnership (collectively, the “Contributors”), the Partnership acquired mineral, royalty, and overriding royalty interests in producing and non-producing oil and natural gas properties representing approximately 14,225 net mineral acres located in 14 counties across New Mexico and Texas in exchange for 6,721,144 common units representing limited partnership interests in the Partnership valued at $202.6 million and issued pursuant to the Partnership’s registration statements on Form S-4. At closing, in addition to conveying mineral, royalty and overriding royalty interests to the Partnership, the Contributors delivered funds to the Partnership in an amount equal to their cash receipts during the period from July 1, 2024 through September 25, 2024 of $5.9 million. This contributed cash generally reflects receipts from the two months ended August 31, 2024. The contributed cash, net of capitalized transaction costs paid, of $5.8 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.
Current report
On September 30, 2024, pursuant to a non-taxable contribution and exchange agreement with an unrelated third party, the Partnership acquired mineral interests totaling approximately 1,204 net royalty acres located in Weld County, Colorado in exchange for 530,000 common units representing limited partnership interests in the Partnership valued at $16.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. At closing, in addition to conveying mineral interests to the Partnership, the contributors delivered funds to the Partnership in an amount equal to their cash receipts during the period from July 1, 2024 through September 25, 2024 of $0.9 million. This contributed cash generally reflects receipts from the two months ended August 31, 2024. The contributed cash, net of capitalized transaction costs paid, of $0.9 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.
Current report
On September 29, 2023, pursuant to a non-taxable contribution and exchange agreement with an unrelated third party, the Partnership acquired mineral and royalty interests totaling approximately 716 net royalty acres located in three counties in Texas in exchange for 494,000 common units representing limited partnership interests in the Partnership valued at $14.4 million and issued pursuant to the Partnership’s registration statement on Form S-4. Contributed cash delivered at closing, net of capitalized transaction costs paid, of $0.8 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2023.
Current report
On August 31, 2023, pursuant to a non-taxable contribution and exchange agreement with multiple unrelated third parties, the Partnership acquired mineral and royalty interests totaling approximately 568 net royalty acres located in three counties in Texas in exchange for 374,000 common units representing limited partnership interests in the Partnership valued at $10.4 million and issued pursuant to the Partnership’s registration statement on Form S-4. Contributed cash delivered at closing, net of capitalized transaction costs paid, of $0.2 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2023. Final settlement net cash received, net of capitalized transaction costs paid, of $0.2 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.
Current report
On July 12, 2023, pursuant to a non-taxable contribution and exchange agreement with multiple unrelated third parties, the Partnership acquired mineral and royalty interests totaling approximately 900 net royalty acres located in 13 counties and parishes across Louisiana, New Mexico, and Texas in exchange for 343,750 common units representing limited partnership interests in the Partnership valued at $11.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. Contributed cash delivered at closing, net of capitalized transaction costs paid, of $0.5 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2023.
Reworded paragraphs (14)
Previous wording
This discussion, which presents our results of operations for the three and six months ended June 30, 2024 and 2023, should be read in conjunction with our unaudited condensed consolidated financial statements and the accompanying notes. We intend for this discussion to provide the reader with information that will assist in understanding our financial statements, the changes in certain key items in those financial statements from period to period, and the primary factors that accounted for those changes.
Current wording
This discussion, which presents our results of operations for the three and nine months ended September 30, 2024 and 2023, should be read in conjunction with our unaudited condensed consolidated financial statements and the accompanying notes. We intend for this discussion to provide the reader with information that will assist in understanding our financial statements, the changes in certain key items in those financial statements from period to period, and the primary factors that accounted for those changes.
Previous wording
From a cash perspective, as of June 30, 2024, the NPI was in a surplus position and had outstanding capital commitments, primarily in the Bakken region, equaling cash on hand of $3.8 million.
Current wording
From a cash perspective, as of September 30, 2024, the NPI was in a surplus position and had outstanding capital commitments, primarily in the Bakken region, equaling cash on hand of $3.3 million.
Previous wording
On March 28, 2024, pursuant to a non-taxable contribution and exchange agreement with multiple unrelated third parties, the Partnership acquired mineral interests totaling approximately 1,485 net royalty acres located in two counties in Colorado in exchange for 505,369 common units representing limited partnership interests in the Partnership valued at $17.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. Contributed cash delivered at closing and final settlement net cash received, net of capitalized transaction costs paid, of $4.4 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the six months ended June 30, 2024
Current wording
On March 28, 2024, pursuant to a non-taxable contribution and exchange agreement with multiple unrelated third parties, the Partnership acquired mineral interests totaling approximately 1,485 net royalty acres located in two counties in Colorado in exchange for 505,369 common units representing limited partnership interests in the Partnership valued at $17.0 million and issued pursuant to the Partnership’s registration statement on Form S-4. Contributed cash delivered at closing and final settlement net cash received, net of capitalized transaction costs paid, of $4.4 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.
Previous wording
On September 30, 2022, pursuant to a non-taxable contribution and exchange agreement with Excess Energy, LLC, a Texas limited liability company, the Partnership acquired mineral, royalty and overriding royalty interests totaling approximately 2,100 net royalty acres located in 12 counties across Texas and New Mexico in exchange for 816,719 common units representing limited partnership interests in the Partnership valued at $20.4 million and issued pursuant to the Partnership's registration statement on Form S-4. Final settlement net cash received, net of capitalized transaction costs paid, of $0.5 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the six months ended June 30, 2023.
Current wording
On September 30, 2022, pursuant to a non-taxable contribution and exchange agreement with Excess Energy, LLC, a Texas limited liability company, the Partnership acquired mineral, royalty and overriding royalty interests totaling approximately 2,100 net royalty acres located in 12 counties across Texas and New Mexico in exchange for 816,719 common units representing limited partnership interests in the Partnership valued at $20.4 million and issued pursuant to the Partnership's registration statement on Form S-4. Final settlement net cash received, net of capitalized transaction costs paid, of $0.5 million is included in net cash contributed in acquisitions on the condensed consolidated statement of cash flows for the nine months ended September 30, 2023.
Previous wording
Three and Six Months Ended June 30, 2024 as compared to Three and Six Months Ended June 30, 2023
Current wording
Three and Nine Months Ended September 30, 2024 as compared to Three and Nine Months Ended September 30, 2023
Previous wording
The increase in oil sales volumes attributable to our Royalty Properties from the second quarter and first six months of 2023 to the same periods of 2024 is primarily a result of higher suspense releases on new wells and increased baseline production in the Permian Basin and higher suspense releases on first time payments and increased baseline production in South Texas from wells acquired in the third quarter of 2023 and 2022. The increase in natural gas sales volumes attributable to our Royalty Properties from the second quarter of 2023 to the same period of 2024 is primarily a result of higher suspense releases on new wells and increased baseline production in the Permian Basin and Mid-Continent, increased baseline production in South Texas from wells acquired in the third quarter of 2023, and higher suspense releases on new wells in East Texas from wells acquired in the third quarter of 2022, partially offset by decreased production from legacy wells in the Fayetteville Shale and Barnett Shale. The increase in natural gas sales volumes attributable to our Royalty Properties from the first six months of 2023 to the same period of 2024 is primarily attributable to higher suspense releases on new wells and increased baseline production in the Permian Basin and Mid-Continent, increased baseline production in South Texas from wells acquired in the third quarter of 2023, and higher suspense releases on first time payments and increased baseline production in East Texas from wells acquired in the third quarter of 2022, partially offset by lower suspense releases on first time payments from acquired wells in South Texas during the first quarter of 2024 compared to the same period of 2023, primarily attributable to wells acquired in the third quarter of 2022, and decreased production from legacy wells in the Fayetteville Shale and Barnett Shale.
Current wording
The increase in oil sales volumes attributable to our Royalty Properties from the third quarter and first nine months of 2023 to the same periods of 2024 is primarily a result of higher suspense releases on new wells and increased baseline production in the Permian Basin and Bakken region, increased baseline production in South Texas from wells acquired in the third quarter of 2023 and 2022, and higher suspense releases on first time payments and increased baseline production in the Rockies from wells acquired in the first quarter of 2024 and 2022. The increase in natural gas sales volumes attributable to our Royalty Properties from the third quarter of 2023 to the same period of 2024 is primarily a result of higher suspense releases on new wells and increased baseline production in the Permian Basin and Mid-Continent and higher suspense releases on first time payments and increased baseline production in the Rockies from wells acquired in the first quarter of 2024 and 2022, partially offset by decreased baseline production and lower suspense releases from first time payments on acquired wells in South Texas. The increase in natural gas sales volumes attributable to our Royalty Properties from the first nine months of 2023 to the same period of 2024 is primarily attributable to higher suspense releases on new wells and increased baseline production in the Permian Basin and Mid-Continent, higher suspense releases on first time payments and increased baseline production in East Texas from wells acquired in the third quarter of 2022, and higher suspense releases from first time payments in the Rockies from wells acquired in the first quarter of 2024, partially offset by decreased baseline production and lower suspense releases from first time payments on acquired wells in South Texas and decreased production from legacy wells in the Fayetteville Shale, Barnett Shale, and Southeast.
Previous wording
The decrease in oil sales volumes attributable to our NPI properties from the second quarter of 2023 to the same period of 2024 is primarily the result of decreased baseline production in the Permian Basin and lower suspense releases on new wells in the Permian Basin and Bakken region, partially offset by increased baseline production in the Bakken region. The decrease in oil sales volumes attributable to our NPI properties from the first six months of 2023 to the same period of 2024 is primarily the result of decreased baseline production and lower suspense releases on new wells in the Permian Basin, partially offset by increased baseline production and higher suspense releases on new wells in the Bakken region during the second quarter of 2024 compared to the same period of 2023. The increase in natural gas sales volumes attributable to our NPI properties from the second quarter of 2023 to the same period of 2024 is primarily the result of increased baseline production and higher suspense releases in the Mid-Continent. The decrease in natural gas sales volumes attributable to our NPI properties from the first six months of 2023 to the same period of 2024 is primarily the result of lower suspense releases on new wells in the Permian Basin, partially offset by higher suspense releases on new wells in the Mid-Continent and increased baseline production and higher suspense releases on new wells in the Bakken region during the second quarter of 2024 compared to the same period of 2023.
Current wording
The increase in oil sales volumes attributable to our NPI properties from the third quarter of 2023 to the same period of 2024 is primarily the result of increased baseline production in the Permian Basin and Bakken region and higher suspense releases on new wells in the Bakken region, partially offset by lower suspense releases on new wells in the Permian Basin. The decrease in oil sales volumes attributable to our NPI properties from the first nine months of 2023 to the same period of 2024 is primarily the result of lower suspense releases on new wells in the Permian Basin, partially offset by increased baseline production in the Permian Basin and Bakken region and higher suspense releases on new wells in the Bakken region. The increase in natural gas sales volumes attributable to our NPI properties from the third quarter of 2023 to the same period of 2024 is primarily the result of increased baseline production in the Permian Basin, Bakken region, and Mid-Continent. The decrease in natural gas sales volumes attributable to our NPI properties from the first nine months of 2023 to the same period of 2024 is primarily the result of lower suspense releases on new wells in the Permian Basin, partially offset by higher suspense releases on new wells in the Bakken region and Mid-Continent and increased baseline production the Permian Basin, Bakken region, and Mid-Continent during the second and third quarters of 2024 compared to the same periods of 2023.
Previous wording
Operating costs, including production taxes, increased 28% from the second quarter of 2023 to the same period of 2024 and 12% from the first six months of 2023 to the same period of 2024. The increases are primarily a result of higher proportionate taxes due to higher oil and natural gas sales volumes and higher oil sales prices attributable to our Royalty Properties.
Current wording
Operating costs, including production taxes, increased 11% from the third quarter of 2023 to the same period of 2024 and 12% from the first nine months of 2023 to the same period of 2024. The increases are primarily a result of higher proportionate operating expenses and oil production taxes due to higher oil and natural gas sales volumes and higher oil sales revenue, partially offset by lower proportionate natural gas production taxes due to lower natural gas sales revenue driven by lower natural gas sales prices and lower ad valorem taxes.
Previous wording
Depreciation, depletion and amortization increased 44% from the second quarter of 2023 to the same period of 2024 and 22% from the first six months of 2023 to the same period of 2024. We adjust our depletion rate each quarter for significant changes in our estimates of oil and natural gas reserves, including recent acquisitions.
Current wording
Depreciation, depletion and amortization increased 52% from the third quarter of 2023 to the same period of 2024 and 32% from the first nine months of 2023 to the same period of 2024. Depletion is the amount of cost basis of oil and natural gas properties at the beginning of a period attributable to the volume of reserves extracted during such period, calculated on a units-of-production basis. Estimates of proved developed producing reserves are a major component in the calculation of depletion. We adjust our depletion rate each quarter for significant changes in our estimates of oil and natural gas reserves, including recent acquisitions and suspense releases on new wells.
Previous wording
General and administrative expenses decreased 6% from the second quarter of 2023 to the same period of 2024. The decrease is primarily a result of one-time, non-recurring professional services expenses of $1.2 million related to an unsuccessful acquisition in the second quarter of 2023, partially offset by higher compensation expenses, including an expanded Operating Partnership equity program designed for employee retention, and increased professional service fees in the second quarter of 2024. General and administrative expenses increased 7% from the first six months of 2023 to the same period of 2024. The increase is primarily a result of higher compensation expenses, including an expanded Operating Partnership equity program designed for employee retention, and increased legal and professional service fees, partially offset by a decrease resulting from one-time, non-recurring professional services expenses of $1.2 million related to an unsuccessful acquisition in the second quarter of 2023.
Current wording
General and administrative expenses increased 3% from the third quarter of 2023 to the same period of 2024 and 5% from the first nine months of 2023 to the same period of 2024. The increases are primarily a result of higher compensation expenses, including an expanded Operating Partnership equity program designed for employee retention, and increased professional service fees, partially offset by a decrease resulting from one-time, non-recurring professional services expenses of $1.2 million related to an unsuccessful acquisition in the first nine months of 2023.
Previous wording
Net cash provided by operating activities decreased 16% from the first six months of 2023 to the same period of 2024. The decrease is primarily due to lower NPI payment receipts and higher general and administrative expense payments, partially offset by higher Royalty revenue receipts, net of production taxes and operating expenses.
Current wording
Net cash provided by operating activities remained consistent from the first nine months of 2023 to the same period of 2024 primarily due to higher Royalties revenue receipts, net of production taxes and operating expenses, partially offset by lower NPI payment receipts and higher general and administrative expenses.
Previous wording
Cash receipts attributable to our Royalty Properties during the second quarter of 2024 totaled $26.1 million. Approximately 74% of these receipts reflect oil sales during March 2024 through May 2024 and natural gas sales during February 2024 through April 2024, and approximately 26% from prior sales periods. The average indicated prices for oil and natural gas sales cash receipts attributable to the Royalty Properties during the second quarter of 2024 were $70.48/bbl and $1.53/mcf, respectively.
Current wording
Cash receipts attributable to our Royalty Properties during the third quarter of 2024 totaled $40.2 million. Approximately 54% of these receipts reflect oil sales during June 2024 through August 2024 and natural gas sales during May 2024 through July 2024, and approximately 46% from prior sales periods. The average indicated prices for oil and natural gas sales cash receipts attributable to the Royalty Properties during the third quarter of 2024 were $69.91/bbl and $1.08/mcf, respectively. Cash receipts attributable to contributed cash from the two acquisitions closed September 30, 2024, totaled approximately $6.8 million. This generally reflects receipts from the two months ended August 31, 2024.
Previous wording
Cash receipts attributable to our Net Profits Interest during the second quarter of 2024 totaled $6.4 million. Approximately 69% of these receipts reflect oil and natural gas sales during February 2024 through April 2024, and approximately 31% from prior sales periods. The average indicated prices for oil and natural gas sales cash receipts attributable to the NPI properties during the second quarter of 2024 were $67.51/bbl and $2.24/mcf, respectively.
Current wording
Cash receipts attributable to our NPI during the third quarter of 2024 totaled $6.0 million. Approximately 70% of these receipts reflect oil and natural gas sales during May 2024 through July 2024, and approximately 30% from prior sales periods. The average indicated prices for oil and natural gas sales cash receipts attributable to the NPI properties during the third quarter of 2024 were $65.51/bbl and $1.27/mcf, respectively.
Previous wording
Cash and cash equivalents totaled $35.2 million at June 30, 2024 and $47.0 million at December 31, 2023.
Current wording
Cash and cash equivalents totaled $56.5 million at September 30, 2024 and $47.0 million at December 31, 2023.