Kimbell Royalty Board Approves Mineral Interests Acquisition

Kimbell Royalty Partners LP, an owner of oil and gas mineral and royalty interests in 13 million gross acres in 28 states, has agreed to acquire mineral and royalty interests from an undisclosed seller in an all-cash transaction valued at $57 million, subject to purchase price adjustments and other customary closing adjustments. The board of directors of Kimbell’s general partner and the governing bodies of the seller have each unanimously approved the acquisition, which is expected to close in fourth quarter 2021, subject to customary closing conditions. The effective date of the acquisition is expected to be November 1, 2021.

Kimbell estimates as of November 1, 2021, the seller’s royalty assets across a diverse property set have more than 26,000 gross producing wells concentrated in the Permian (39 percent), Mid-Continent (31 percent) and Haynesville (14 percent) basins.

“This is a compelling bolt-on acquisition that is expected to be immediately accretive to Kimbell’s cash available for distribution per common unit and highlights our competitive advantage in acquiring complex, multi-basin mineral and royalty portfolios,” says Bob Ravnaas, chairman and chief executive officer of Kimbell’s general partner. “We have known the seller for nearly 20 years and this deal was agreed upon via direct negotiation without a broker or intermediary. The seller’s production profile is a natural fit with Kimbell’s existing portfolio and is supported by an attractive mix of conventional and unconventional asset positions located in the premier oil and gas basins in the lower 48. Furthermore, the targeted assets are characterized by an extremely shallow 9 percent production decline rate, which will enhance Kimbell’s best-in-class PDP decline rate.”