TPL · Earnings call · 2026Q2T · Full report

Oil and Gas Production Mix

Texas Pacific Land Corp · 2026-08-05 · Importance 20 · Surprise 24

Management said the lower oil percentage in the second quarter was not expected to be a near-term trend. Recent acquisitions and heavy development in gas-rich areas, including Culberson County wells, increased the gas cut and resulted in an oil cut of approximately 35%. Management expects the oil cut to return to more than 40% over the long term. Drilling and completion activity across three- and four-mile laterals can materially affect the production mix as new wells come online.

Key facts

• Management expects oil percentage to trend back up and more normalized over the long term should get back to 40% plus over time, with an intermediate expectation around mid-30% oil cuts.
• As of quarter end, TPL had 5.6 net permitted wells, 9.5 net drilled but uncompleted wells (DUCs) and 3.4 net completed but not producing wells, totaling 18.4 net line-of-sight wells.
• Oil and gas royalty production averaged approximately 39,700 barrels of oil equivalent per day, up 7% sequentially and 20% year-over-year.
• Oil production ticked down about 5% in the second quarter.
• There was heavy development late last year and throughout 2025 in areas that are pretty gas-rich, including from one of TPL's other acquisitions and Culberson County had high-interest wells drilled over a short time frame.