Texas Pacific Land Extends Record Quarter on Oil Royalties

The Tip Desk · November 5, 2026 · 3 min read

Third-quarter revenue reached a record $273.4 million as oil and gas royalties hit $167.3 million and net income was $167.4 million, or $2.42 a share.

Texas Pacific Land Corporation (TPL), one of the largest land and royalty owners in Texas, reported record consolidated revenue, net income and free cash flow for the third quarter of 2026.

Consolidated revenues were $273.4 million, up from $246.1 million in the second quarter. The company said the increase was driven primarily by a $21.7 million rise in oil and gas royalty revenue, a $12.5 million rise in easements and other surface-related income, and a $4.3 million rise in produced water royalties, partially offset by an $11.3 million decline in water sales.

Oil and gas royalty revenue reached a record $167.3 million. Average realized price was $44.97 per Boe, and the company’s share of production was 42.3 thousand barrels of oil equivalent per day. Oil royalties were $125.9 million. Natural gas royalties were $15.6 million, and NGL royalties were $25.7 million. Oil volumes were 1,578 thousand barrels. Natural gas volumes were 7,051 million cubic feet, and NGL volumes were 1,142 thousand barrels. Oil realized price was $83.57 a barrel, natural gas $2.40 a thousand cubic feet, and NGLs $24.37 a barrel.

Chief Executive Officer Tyler Glover said royalty acreage benefited from development activity, elevated oil prices and improved gas realizations, and that pipeline easement revenue was strong as operators expanded midstream infrastructure.

Produced water royalty revenue rose to a record $41.4 million, with volumes of 5.5 million barrels per day. Glover said growing Permian produced water supported those records. Water sales revenue fell to $28.4 million. The company said the decline reflected lower average realized pricing, partially offset by higher water sales volumes of 672 thousand barrels per day.

Easements and other surface-related income were $36.2 million. Land sales were $0.1 million. Land and Resource Management segment revenues were $201.6 million. Water Services and Operations segment revenues were $71.8 million.

Net income was $167.4 million, or $2.42 a share diluted. Adjusted EBITDA was $238.4 million, and free cash flow was $170.3 million. Operating income was $207.8 million. Land and Resource Management operating income was $166.3 million; Water Services and Operations operating income was $41.5 million. Total operating expenses were $65.6 million, which the company attributed principally to higher depreciation, depletion and amortization, general and administrative expenses, and water service-related expenses.

As of September 30, 2026, royalty acreage had 16.8 net wells, including 5.7 permits, 8.6 drilled but uncompleted wells and 2.5 completed but not producing wells, and 132.5 net producing wells. Wells added in the quarter had an average lateral of about 10,623 feet.

For the nine months ended September 30, 2026, consolidated net income was $464.2 million, or $6.73 a share diluted, and free cash flow was $462.3 million. Oil and gas royalty production averaged 39.7 thousand Boe per day.

The company completed construction and commenced commissioning of the Phase 2B produced water desalination facility in Orla, Texas, with anticipated capacity of 10,000 inlet barrels per day, and announced an agreement with Chevron U.S.A. Inc. to provide land and brackish water for Project Kilby, a power generation facility in Reeves County intended to support a customer data center. Glover said efforts toward data centers, power generation, and produced water desalination and beneficial reuse continue to progress. The board declared a quarterly cash dividend of $0.60 a share, payable December 15, 2026.