Texas Pacific Land Corporation · NYSE:TPL
Texas Pacific Land — Investor Presentation (March 2021)
35 slides from Texas Pacific Land's investor presentation, Mar 2, 2021
Slide 1: Investor Presentation March 2021
Investor Presentation March 2021 Exhibit 99.1
Slide 2: Disclaimer
| 2NYSE: TPL This presentation has been designed to provide general information about Texas Pacific Land Corporation and its subsidiaries (“TPL” or the “Company”). Any information contained or referenced herein is suitable only as an introduction to the Company. The recipient is strongly encouraged
Slide 3: The Permian Basin "ETF"
| 3NYSE: TPL The Permian Basin “ETF” NYSE: TPL $ $ $ ~21 Years Inventory Below $40/bbl Breakeven(4) Performance Through the Cycle $303 Million 2020 Revenue +150% Production Growth since 2018(3) Balance Sheet Strength(1) No Debt Cash Balance of $281 Million $200mm+ Dividends Paid in 2020 17 Year Hist
Slide 4: An Unmatched Oil and Gas Investment
| 4NYSE: TPL An Unmatched Oil and Gas Investment Source: FactSet . (1) Based on FactSet compounded total shareholder return from January 2011 to December 2020. (Composite) WTI Oil S&P Oil & Gas E&P Index 10-year Average Annual Total Return(1) -11% -6% 14% 18% 36%
Slide 5: TPL Completes Reorganization into a Delaware C-Corp
| 5NYSE: TPL TPL Completes Reorganization into a Delaware C-Corp TPL Welcomes in a New Era in its 130+ year History Texas Pacific Land Trust is now Texas Pacific Land Corporation ■ January 2021 – reorganized from a business trust into a Delaware corporation, Texas Pacific Land Corporation ■ Nine-mem
Slide 6: Meet the New Texas Pacific Land Corporation Board of Directors
| 6NYSE: TPL Meet the New Texas Pacific Land Corporation Board of Directors David E. Barry Director and Co-Chair of the Board of Directors John R. Norris III Director and Co-Chair of the Board of Directors Barbara J. Duganier Director and Chair of the Compensation Committee Mr. Norris serves as Co-
Slide 7: TPL Business Overview
| 7NYSE: TPL 19% 46% 35% SLEM Royalties Water Unique Exposure to Full Permian Development Chain ✓ Ownership of right of way ✓ Ownership of groundwater and subsurface injection rights ✓ High margins with no capital Surface Provides ease of access TPL Business Overview Business Flow Overview Maximize
Slide 8: Royalty Interest Overview
| 8NYSE: TPL 38.8% 21.6% 19.5% 11.1% 9.0% Net Wells(3): 58.6 Royalty Interest Overview Land and Resource Management Net Royalty Position and Rigs Running on Core TPL Acreage Source: Company data, and Enverus data as of 2/25/21. Note: Rigs on TPL based on 0.25 mile buffer around TPL Royalty Acreage D
Slide 9: Exposed to Diverse Client Base
| 9NYSE: TPL $174.3 $162.6 $136.6 $70.7 $42.7 $29.1 $18.7 $16.1 $7.6 $6.0 $5.4 $5.3 $3.8 $3.7 $2.0 $1.6 $1.4 $0.7 $0.6 $0.5 $0.4 $0.2 E x x o n C h e v ro n S h e ll B P C o n o c o E O G P io n e e r O c c id e n ta l D ia m o n d b a c k D e v o n A p a c h e M a ra th o n C im a re x O v in ti v
Slide 10: Free Cash Flow and Net Production
| 10NYSE: TPL $40 $75 $125 $230 $205 3.3 5.1 8.8 13.7 16.2 – 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 $0 $50 $100 $150 $200 $250 $300 $350 $400 2016 2017 2018 2019 2020 Free Cash Flow Net Production (mboe/d) Land and Resource Management 65% Water Services and Operations 35% Land and Resource Managem
Slide 11: History of TPL
| 11NYSE: TPL History of TPL Source: Company data. (1) A fixed 1/16 NPRI was reserved under all lands held by the primary term of an oil and gas lease and a fixed 1/128 NPRI under all lands held by production. (2) TPWR is a 100% wholly owned subsidiary of TPL. 1871 - 1888 1889 - 2010 2011 - Present
Slide 12: Key Investment Highlights
| 12NYSE: TPL Key Investment Highlights Sustained Profitability and Pristine Balance Sheet Focus on Return On and Of Capital ETF of the Permian Basin Performance Through the Cycle ■ Largest royalty company with 100% of acreage located in Texas Permian Basin ■ Three high-margin businesses linked to t
Slide 13: Comparison of Key Statistics
| 13NYSE: TPL Comparison of Key Statistics Land and Resource Management Source: Company data, public filings and Enverus as of 12/31/20. (1) TPL NRA is based on 4.4% average royalty interest per acre. VNOM NRA reported in February 2021 Investor Presentation. MNRL NRA reported in February 2021 Invest
Slide 14: Surface Leases, Easements and Material Sales
| 14NYSE: TPL – 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 – $40 $80 $120 $160 $200 $240 $280 C u m u la tiv e H o riz o n ta l W e ll C o u n t S in c e 2 0 1 6 (3 ) C u m u la ti v e S L E M R e v e n u e s in c e 2 0 1 6 ($ m m ) (2 ) SLEM Revenue Well Count ✓Extensive position allows ou
Slide 15: TPL Water Sourcing Infrastructure
| 15NYSE: TPL TPL Water Sourcing Infrastructure Water Resources Asset Overview Water Services and Operations Source: Company data and RSEG. Note: TPL does not operate any water disposal wells. (1) Water oil ratio (“WOR”) defined as the ratio of 12-month cumulative water production to 12-month cumula
Slide 16: Growth Strategy and Competitive Advantage: Water Services
| 16NYSE: TPL – $10 $20 $30 $40 $50 $60 $70 $80 – $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 W T I O il P ric e ($ /b b l) R e v e n u e ( $ m m ) Easements and other Surface-related income ($mm) WTI ($/bbl) Growth Strategy and Competitive
Slide 17: Northern Delaware Volumes and TPWR Capture Rate
| 17NYSE: TPL 0% 5% 10% 15% 20% 25% 30% 35% 40% – 200 400 600 800 1,000 1,200 1,400 1,600 1,800 Jan-18 Jun-18 Dec-18 Jun-19 Dec-19 Jun-20 Dec-20 T P W R C a p tu re R a te C o m p le ti o n s V o lu m e s (m b b ls / d a y ) Northern Delaware Region Volumes (Estimated) TPL Delaware Volumes (Actuals)
Slide 18: TPL's Water Business Performance Through the Cycle
| 18NYSE: TPL 73% 66% 60% 68% 68% 75% 65% 70% 67% 69% 50% 55% 60% 65% 70% 75% 80% TPL’s Water Business Performance Through the Cycle Water Services and Operations $127 2019 $107 2020 Revenue Detail ($mm)2019 vs 2020 EBITDA Margin $ ■ Increased EBITDA margin attributed to: − Cost cutting measures − G
Slide 19: Summary of Financials
| 19NYSE: TPL 0.3 0.4 0.6 1.1 1.8 2.1 2015 2016 2017 2018 2019 2020 $55 $63 $145 $245 $302 $239 2015 2016 2017 2018 2019 2020 Summary of Financials Source: Company data. Note: Revenue was restated retrospectively upon adoption of new revenue recognition guidance on 1/1/18. CAGR defined as the compou
Slide 20: Return of Capital to Shareholders
| 20NYSE: TPL $2.0 $2.0 $4.3 $2.2 $2.4 $2.5 $10.7 $31.6 $46.6 $10.7 $16.0 $20.2 $25.2 $23.0 $28.8 $33.1 $34.2 $38.4 $4.3 $12.7 $18.0 $24.5 $25.2 $25.2 $31.2 $35.6 $44.9 $70.0 $50.9 $201.7 $79.48 $94.88 $94.12 $97.98 $92.90 $48.69 $43.35 $50.78 $65.08 $56.99 $39.19 – $20.00 $40.00 $60.00 $80.00 $100.
Slide 21: An Unmatched Oil and Gas Investment
| 21NYSE: TPL An Unmatched Oil and Gas Investment Source: FactSet. (1) Based on FactSet compounded total shareholder return from January 2011 to December 2020. Sustained Profitability and Pristine Balance Sheet Focus on Return On and Of Capital ETF of the Permian Basin Significant Upside Synergistic
Slide 22: Appendix
Appendix
Slide 23: Texas Pacific Land Corporation Team
| 23NYSE: TPL Texas Pacific Land Corporation Team Track Record of Shareholder Value Creation Texas Pacific Land Corporation Texas Pacific Water Resources Jeremy Smith VP, Business Development Tyler Glover President and CEO Robert J. Packer CFO Chris Steddum VP, Finance and Investor Relations Robert
Slide 24: TPL Revenue Streams Through the Life Cycle of a Well
| 24NYSE: TPL TPL Revenue Streams Through the Life Cycle of a Well Surface and Royalty Ownership Allow Steady Revenue Generation Through the Entire Life Cycle of Oil & Gas Development ■ Infrastructure for oil & gas development Initial Development Phase Drilling and Completion Phase Production Phase
Slide 25: Well Positioned Assets Attract Increasing Development Focus
| 25NYSE: TPL 71 107 121 319 362 486 531 2014 2015 2016 2017 2018 2019 2020 1.7 2.7 3.3 5.1 8.8 13.7 16.2 2014 2015 2016 2017 2018 2019 2020 Well Positioned Assets Attract Increasing Development Focus Land and Resource Management Source: Company data and Enverus. Note: TPL production growth giving e
Slide 26: Significant Undeveloped Resource in Core Areas
| 26NYSE: TPL 0% 20% 40% 60% 80% 100% 120% 1 607 1,213 1,819 2,425 3,031 3,637 4,243 4,849 5,455 6,061 6,667 7,273 7,879 8,485 9,091 9,697 10,303 10,909 11,515 12,121 12,727 13,333 13,939 14,545 15,151 15,757 16,363 16,969 17,575 18,181 18,787 19,393 W e ll h e a d B T a x I R R $0 $10 $20 $30 $40 $
Slide 27: Summary of Highest-Visibility Inventory
| 27NYSE: TPL 57.5% 33.6% 5.7% 3.3% 54.5% 31.0% 13.0% 1.4% 77.2% 16.8% 5.9% 14.8% 16.3% 9.7% 8.7%5.9% 4.8% 12.3% 27.5% Summary of Highest-Visibility Inventory Land and Resource Management Source: Company data and Enverus. Note: Permian Basin horizontal locations only as of 12/31/20. (1) Permitted we
Slide 28: Undeveloped Inventory Summary
| 28NYSE: TPL Undeveloped Inventory Summary Land and Resource Management Source: Company data and Enverus. Note: Locations reflect additional undeveloped locations sorted by interval and oil estimated ultimate recovery (“EUR”). Permian Basin horizontal locations only. Inclusive of DUCs, Permits and
Slide 29: Summary of Full Inventory
| 29NYSE: TPL Average Additional Total PDP + Total Gross Undeveloped PDP + Total Average Lat. Sub-region NRI NRA DSUs PDP Completed DUCs Permits Undeveloped Locations Locations Resource (Mmboe) Locations / DSU Length (ft.) Northern Delaware 2.3% 9,206 510 1,271 98 192 218 10,213 10,720 11,991 17,387
Slide 30: Significant Undeveloped Resource in Core Areas
| 30NYSE: TPL Southeast DelawareSouthwest Delaware Northern Delaware Significant Undeveloped Resource in Core Areas Land and Resource Management Delaware Basin DSU Heat Map Source: Company data and Enverus. Note: Excluding areas considered outside of basin. Developed inventory includes PDP only. % D
Slide 31: Royalty Key Terms
| 31NYSE: TPL Gross Royalty Acres Royalty Key Terms Land and Resource Management Net Royalty Acres (Normalized to 1/8) Net Royalty Acres Drilling Space Units (“DSUs”) Implied Average Net Revenue Interest per Well Description How’s It Calculated ■ An undivided ownership of the oil, gas, and minerals
Slide 32: Water Resources Overview
| 32NYSE: TPL Water Resources Overview Water Services and Operations Water Resources Provide “Royalty-Like” Injection Fees, while Promoting Operator Development on TPL Land Provides Critical Infrastructure for E&P OperatorsFull-Service Water Solutions for Permian Basin Oil & Gas Operations Producing
Slide 33: Historical Financial Summary
| 33NYSE: TPL Historical Financial Summary Source: Company data. Note: Numbers may not foot due to immaterial rounding. Year ended December 31, Three months ended, Year ended ($ in millions) 2017 2018 2019 1Q20 2Q20 3Q20 4Q20 December 31, 2020 Total Acres 887,698 902,177 901,787 902,513 902,016 881,
Slide 34: Non-GAAP Reconciliations
| 34NYSE: TPL Non-GAAP Reconciliations Source: Company data. Note: Numbers may not foot due to immaterial rounding. (1) Land swap of ~$22 million in 4Q19, Land sale in Upton County in 1Q15 of ~$20 million and sale to WPX in 1Q19 of ~$100 million. (2) Sale of nonparticipating perpetual oil and gas ro
Slide 35: Texas Pacific Land Corporation
1700 Pacific Avenue, Suite 2900 Dallas, Texas 75201 Texas Pacific Land Corporation
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