Locator: 51130B.
PSA: US postage stamps to increase in price this Sunday, July 12, 2026.
- Forever Stamps (one ounce): to 82 cents from current 78 cents
Anticipation: futures after President Trump says the "ceasefire with Iran is over."
US exports, refined products: huge jump --
Mideast: CENTCOM carries out attacks on 80 targets after Iran targets three commercial cargo ships; Iran responds by hitting targets across the Middle East; results in lots of green. WTI up over 6% overnight. WTI trending toward $75.
Is NATO finally getting on with it? Getting serious?
From The New York Times:
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Back to the Bakken
WTI: $74.76.
New wells reporting:
- Thursday, July 9, 2026: 15 for the month, 15 for the quarter, 368 for the year,
- 41917, conf, Murfin Drilling, MH Hecker 1-14H,
- Wednesday, July 8, 2026: 14 for the month, 14 for the quarter, 367 for the year,
- 41232, conf, Oasis, Hoehn 5202 41-24 5B
- 41231, conf, Oasis, Hoehn 5202 41-24 4B,
- 41230, conf, Oasis, Hoehn 5202 41-24 2B,
- 41194, conf, Oasis, Hoehn 5202 41-24 3B,
- 40624, conf, Devon Energy, Skaar 15-22 7H,
The maps, the Oasis Hoehn wells:
The Oasis Hoehn wells are south of Williston, south side of the river, just west of US Highway 85 in Indian Hill oil field.
RBN Energy: strong margins for minerals/royalty firms spur consolidation and an IPO. Link here. Archived.
About a year ago, we chronicled the performance of publicly traded
companies holding oil and gas mineral and royalty interests, the
approximately 20% of gross revenues generated from wells without
responsibility for the costs associated with development and production.
M&A activity in the minerals/royalty space, which peaked in
2018-19, quieted during a prolonged post-pandemic wave of major E&P
consolidation. As rising realizations for both oil and natural gas have
recently boosted cash flows, the minerals/royalty sector has seen both
the first major consolidation of the publicly traded firms as well as a
recent successful initial public offering (IPO) that harkens additional
entrants to the arena. In today’s RBN blog, we update our comparison of
the performance of these entities with traditional E&Ps, analyze the
valuation trends for each mineral/royalty company, and review
significant transaction market activity.
Before we dive deeper on this, let’s quickly define a few key
terms and explain in simple terms the financial side of well development
and who gets what money-wise from a producing well. First, some
definitions:
Mineral interests are
the exclusive rights to the minerals, including oil and natural gas,
found on, in, or beneath a piece of land. These rights may be leased to
companies that extract oil and gas but are retained in perpetuity and
survive the lease.
Royalty interests are
payments to mineral interest holders negotiated as part of the lease
and based on a percentage of oil and gas production. Royalty holders are
not responsible for costs associated with oil and gas production except
applicable taxes on revenue and have no abandonment or environmental
liabilities. Royalty interests are terminated when the lease ends.
Working interests
constitute ownership of the remaining production from a lease. Working
interest (WI) owners are responsible for 100% of the costs of finding,
developing, and producing oil and gas on the leasehold, as well as
funding abandonment of the well and any environmental liabilities. In
describing assets, E&P companies often identify their relative
working interest (e.g., 100% WI) and the net revenue interest (81.4%
NRI), which reflects the total royalties paid.
Because
they don’t incur production costs, companies that solely hold mineral
and royalty interests retain a larger margin of their share of the net
revenues derived from production than traditional E&Ps. In Figure 1
below, we compare the Q1 2026 income statements of seven publicly traded
mineral/royalty companies (generally referred to as royalty trusts, or
RTs), four of them U.S.-based (Viper Energy, Black Stone Minerals,
Kimbell Royalty Partners, and Dorchester Minerals), and three based in
Canada (PrairieSky Royalties, Freehold Royalties, and Topaz Energy),
with the results of a universe of 34 major E&P companies that we
cover. (Note: We have excluded hybrid firms that have significant
revenue streams other than oil and gas mineral/royalty rights to
simplify valuation calculations). Because of the virtual lack of
production costs, the RTs generated pre-tax free cash flow of
$37.32/boe, or 94% of net revenues, compared with $26.87/boe, or 70% of net revenues, for the E&Ps. Pre-tax net income for the RTs was 60% of net revenues, compared with 35% for the E&Ps.
