TXO Partners Reports 26% Revenue Decline, Net Income Recovery for Fiscal Year 2024

TXO Partners, L.P. reported a significant decline in its financial performance for the fiscal year ending December 31, 2024, with total revenues of $282.8 million, a decrease of 26% from $380.7 million in 2023. This decline was primarily driven by a substantial drop in natural gas sales, which fell from $168.8 million in 2023 to $55.1 million in 2024, reflecting a 60% decrease in average selling prices. Oil revenues, however, increased slightly to $198.3 million from $182.7 million, while natural gas liquids revenues remained relatively stable at $29.4 million. The company also reported a net income of $23.5 million, a recovery from a net loss of $104 million in the previous year.

Operationally, TXO Partners increased its average daily production to 23,387 barrels of oil equivalent (Boe) per day, up from 23,000 Boe per day in 2023. The company attributed this increase to successful acquisitions, particularly in the Williston Basin, which contributed to an additional 162 MBoe in production. The total estimated proved reserves as of December 31, 2024, were approximately 94 million Boe, with 89% classified as proved developed reserves. The company’s asset base is concentrated in the Permian, San Juan, and Williston Basins, which are characterized by low decline rates and high recovery potential.

In terms of strategic developments, TXO Partners completed two significant acquisitions in August 2024, acquiring producing properties in the Williston Basin for a total cash consideration of $245.6 million and an additional $17 million for properties from Kaiser-Francis Oil Company. These acquisitions were funded through a combination of cash from a public offering and borrowings under the company’s credit facility, which was increased to a borrowing base of $275 million following an amendment in August 2024. The company also raised $141.2 million through a public offering of common units, which was utilized to support these acquisitions.

The company’s operational expenses increased slightly to $289.7 million in 2024, up from $504.5 million in 2023, primarily due to higher production costs associated with the new acquisitions. General and administrative expenses rose significantly, reflecting the costs associated with being a publicly traded entity. Despite these increases, the company maintained a strong liquidity position, with cash and cash equivalents totaling $7.3 million at year-end, alongside $150 million in outstanding borrowings.

Looking ahead, TXO Partners anticipates continued volatility in commodity prices, which will significantly impact its revenue and cash flow. The company plans to focus on maintaining a flat to low growth production profile while optimizing existing assets and pursuing further acquisitions. The management has indicated that the capital budget for 2025 is projected to be between $30 million and $50 million, primarily funded through cash flow from operations. The company remains committed to providing cash distributions to its unitholders, although these may fluctuate based on operational performance and market conditions.