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What changed in LandBridge Co LLC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of LandBridge Co LLC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+462 added−605 removedSource: 10-K (2026-02-26) vs 10-K (2025-03-06)

Top changes in LandBridge Co LLC's 2025 10-K

462 paragraphs added · 605 removed · 336 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

101 edited+22 added−81 removed186 unchanged
Biggest changeSimilar to the other operations conducted on our land, we expect to enter into surface use or similar agreements with the owners of these projects from which we expect to receive surface use fees and other payments in connection with the utilization of our land, but we do not expect to own or operate such projects or expect to incur significant capital expenditures in connection therewith. 12 For the year ended December 31, 2023, we generated $52.1 million of non-oil and gas royalty revenue on our approximately 72,000 owned surface acres, or $724 in revenue per owned surface acre.
Biggest changeSimilar to the other operations conducted on our land, we expect to enter into surface use or similar agreements with the owners of these projects from which we expect to receive surface use fees and other payments in connection with the utilization of our land, but we do not expect to own or operate such projects or expect to incur significant capital expenditures in connection therewith. 11 We measure our revenue divided by our acreage as a performance metric, which we refer to as “surface use economic efficiency.” The surface use economic efficiency metric for the years ended December 31, 2025 and 2024 are shown in the following table: Total Weighted average acreage (2) Surface use economic efficiency (3) (4) Variance acreage (1) 2025 2024 2025 2024 Percent (in thousands) Legacy acreage 72,000 72,000 72,000 $ 1,159 $ 1,018 14 % 2024 Acquisitions 203,000 203,000 101,008 $ 499 $ 204 145 % 2025 Acquisitions 42,000 8,479 - $ 208 $ - - % Total 317,000 283,479 173,008 $ 658 $ 543 21 % (1) Total acreage is rounded and reflects fee surface acres, together with leasehold acres and acreage subject to a long-term management agreement.
Surface use payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar payments in the immediate vicinity of our land.
Surface use payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar payments in the immediate vicinity of our land.
The agreement provides for automatic annual increases in royalties after a specified period of time that are tied to the lesser of the CPI and a fixed percentage, and mutual termination rights in the event of a counterparty default and contains standard confidentiality, indemnification, insurance and change of control provisions; • a produced water facilities agreement granting WaterBridge the right to construct, own and operate produced water handling infrastructure on the East Stateline Ranch, the Lea County Ranches, the Speed Ranch and all future land acquired by us in our Stateline and Northern Positions, with (i) a perpetual term on the East Stateline Ranch for so long as WaterBridge conducts operations thereon and (ii) an initial term of approximately ten years and automatic one-year renewals unless terminated by a party prior to renewal for all other lands.
The agreement provides for automatic annual increases in royalties after a specified period of time that are tied to the lesser of the CPI and a fixed percentage, and mutual termination rights in the event of a counterparty default and contains standard confidentiality, indemnification, insurance and change of control provisions; • a produced water facilities agreement granting WaterBridge the right to construct, own and operate produced water handling infrastructure on the East Stateline Ranch, the Lea County Ranches, the Speed Ranch and all future land acquired by us in our 20 Stateline and Northern Positions, with (i) a perpetual term on the East Stateline Ranch for so long as WaterBridge conducts operations thereon and (ii) an initial term of approximately ten years and automatic one-year renewals unless terminated by a party prior to renewal for all other lands.
Army Corps of Engineers (“Corps”) have pursued multiple rulemakings since 2015 in an attempt to determine the scope of such reach. In January 2023, the EPA and the Corps issued a final rule founded upon the pre-2015 regulations and incorporated updates based on existing Supreme Court decisions, including considerations based on regional and geographic differences.
Army Corps of Engineers (“Corps”) have pursued multiple rulemakings since 2015 in an attempt to determine the scope of such reach. In January 2023, the EPA and the Corps issued a final rule 25 founded upon the pre-2015 regulations and incorporated updates based on existing Supreme Court decisions, including considerations based on regional and geographic differences.
Compliance with the NAAQS requirements or other air 27 pollution control and permitting requirements has the potential to delay the development of oil and natural gas and other projects and increase our or our customers’ costs of development and production, which costs could reduce demand for our services and have a material adverse impact on our results of operations, cash flows and financial position.
Compliance with the NAAQS requirements or other air pollution control and permitting requirements has the potential to delay the development of oil and natural gas and other projects and increase our or our customers’ costs of development and production, which costs could reduce demand for our services and have a material adverse impact on our results of operations, cash flows and financial position.
These agreements provide reciprocal crossing rights as well as royalty and revenue sharing across the Stateline AMI, and provides our customers, including WaterBridge, the certainty necessary to develop large scale infrastructure assets on and around such land. Please see “ —Our Assets—Our Stateline Position ” for more information related to our agreements with TPL.
These agreements provide reciprocal crossing rights as well as royalty and revenue sharing across the Stateline AMI, and provides our customers, including WaterBridge, the certainty necessary to develop 13 large scale infrastructure assets on and around such land. Please see “ —Our Assets—Our Stateline Position ” for more information related to our agreements with TPL.
Our leases with these and other E&P companies permit the lessee to explore for and produce oil, natural gas and NGLs 15 from our land and entitle us to receive an upfront cash payment, or lease bonus, and a percentage of the proceeds from the sales of these commodities in the form of an oil and gas royalty interest.
Our leases with these and other E&P companies permit the lessee to explore for and produce oil, natural gas and NGLs from our land and entitle us to receive an upfront cash payment, or lease bonus, and a percentage of the proceeds from the sales of these commodities in the form of an oil and gas royalty interest.
As a result, our results of operations, cash flows and financial position may vary year over year, with particular periods of results not necessarily indicative of our future results. Human Capital Resources We manage our operations through a shared services agreement (the “Shared Services Agreement”) with certain affiliates of WaterBridge (the “Manager”).
As a result, our results of operations, cash flows and financial position may vary year over year, with particular periods of results not necessarily indicative of our future results. 22 Human Capital Resources We manage our operations through a shared services agreement (the “Shared Services Agreement”) with certain affiliates of WaterBridge (the “Manager”).
The FWS and similar state agencies may designate critical or suitable habitat areas that they believe are necessary for the 29 survival of threatened or endangered species. Such a designation could materially restrict use of, or access to, federal, state, and private lands, including our land.
The FWS and similar state agencies may designate critical or suitable habitat areas that they believe are necessary for the survival of threatened or endangered species. Such a designation could materially restrict use of, or access to, federal, state, and private lands, including our land.
Personnel Health and Safety Safety is important to us and begins with the protection and safety of the personnel who provide services with respect to our business and the communities in which we operate. We value people above all else and remain committed to making safety and health our top priority.
Personnel Health and Safety Safety is important to us and begins with the protection and safety of the personnel who provide services with respect to our business and the communities in which we operate. We value people above all else and remain committed to making safety and health a top priority.
These state and OSHA regulations impose certain requirements concerning worker protection, the treatment, 26 storage and disposal of NORM waste and the management of waste piles, containers and tanks containing NORM, as well as restrictions on the uses of land with NORM contamination.
These state and OSHA regulations impose certain requirements concerning worker protection, the treatment, storage and disposal of NORM waste and the management of waste piles, containers and tanks containing NORM, as well as restrictions on the uses of land with NORM contamination.
An additional consequence of this seismic activity is lawsuits alleging that produced water handling 28 operations have caused damage to neighboring properties or otherwise violated state and federal rules regulating waste disposal.
An additional consequence of this seismic activity is lawsuits alleging that produced water handling operations have caused damage to neighboring properties or otherwise violated state and federal rules regulating waste disposal.
Surface use payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar 21 payments in the immediate vicinity of our land.
Surface use payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar payments in the immediate vicinity of our land.
The terms and conditions of, and pricing for, our agreements with ConocoPhillips are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue .” The majority of our revenues from ConocoPhillips during the year ended December 31, 2024, were generated by brackish water sales, produced water handling royalties and oil and gas royalties, with less significant revenues generated by its other land uses.
The terms and conditions of, and pricing for, our agreements with ConocoPhillips are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue .” The majority of our revenues from ConocoPhillips during the year ended December 31, 2025, were generated by brackish water sales, produced water handling royalties and oil and gas royalties, with less significant revenues generated by its other land uses.
The terms and conditions of, and pricing for, our agreements with EOG Resources are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue. ” The majority of our revenues from EOG Resources during the year ended December 31, 2024, were generated by resource royalties and brackish water sales, with resource royalties generated during the year ended December 31, 2024, reflecting EOG Resources’ sand mining operation on our surface acreage.
The terms and conditions of, and pricing for, our agreements with EOG Resources are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue. ” The majority of our revenues from EOG Resources during the year ended December 31, 2025, were generated by resource royalties and brackish water sales, with resource royalties generated during the year ended December 31, 2025, reflecting EOG Resources’ sand mining operation on our surface acreage.
Environmental Protection Agency (“EPA”) has relied upon as authority for adopting climate change regulatory initiatives relating to greenhouse gas (“GHG”) emissions; • the Federal Water Pollution Control Act, also known as the Clean Water Act (“CWA”), which regulates discharges of pollutants into state and federal waters and establishes the extent to which waterways are subject to federal jurisdiction and rulemaking as protected waters of the United States; • the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), which imposes liability on generators, transporters, and arrangers of hazardous substances at sites where hazardous substance releases have occurred or are threatening to occur; • the Resource Conservation and Recovery Act (“RCRA”), which governs the generation, treatment, storage, transport, and disposal of solid wastes, including hazardous wastes; 25 • the Oil Pollution Act of 1990, which subjects owners and operators of onshore facilities, pipelines and other facilities, as well as lessees or permittees of areas in which offshore facilities are located, that are the site of an oil spill in waters of the United States, to liability for removal costs and damages; • the Safe Drinking Water Act (the “SDWA”), which ensures the quality of the United States’ public drinking water through the adoption of drinking water standards and control of the injection of waste fluids into below-ground formations that may adversely affect drinking water sources; • the Endangered Species Act (the “ESA”), which restricts activities that may affect federally identified endangered and threatened species or their habitats through the implementation of operating restrictions or a temporary, seasonal, or permanent ban in affected areas; • the National Environmental Policy Act, which requires federal agencies to evaluate major agency actions having the potential to impact the environment and that may require the preparation of environmental assessments and more detailed environmental impact statements that may be made available for public review and comment; and • the Occupational Safety and Health Act (“OSHA”), which establishes workplace standards for the protection of the health and safety of employees, including the implementation of hazard communications programs designed to inform employees about hazardous substances in the workplace, potential harmful effects of these substances, and appropriate control measures.
Environmental Protection Agency (“EPA”) has historically relied upon as authority for adopting climate change regulatory initiatives relating to GHG emissions; • the Federal Water Pollution Control Act, also known as the Clean Water Act (“CWA”), which regulates discharges of pollutants into state and federal waters and establishes the extent to which waterways are subject to federal jurisdiction and rulemaking as protected waters of the United States; • the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), which imposes liability on generators, transporters, and arrangers of hazardous substances at sites where hazardous substance releases have occurred or are threatening to occur; • the Resource Conservation and Recovery Act (“RCRA”), which governs the generation, treatment, storage, transport, and disposal of solid wastes, including hazardous wastes; • the Oil Pollution Act of 1990, which subjects owners and operators of onshore facilities, pipelines and other facilities, as well as lessees or permittees of areas in which offshore facilities are located, that are the site of an oil spill in waters of the United States, to liability for removal costs and damages; • the Safe Drinking Water Act (the “SDWA”), which ensures the quality of the United States’ public drinking water through the adoption of drinking water standards and control of the injection of waste fluids into below-ground formations that may adversely affect drinking water sources; • the Endangered Species Act (the “ESA”), which restricts activities that may affect federally identified endangered and threatened species or their habitats through the implementation of operating restrictions or a temporary, seasonal, or permanent ban in affected areas; 24 • the National Environmental Policy Act, which requires federal agencies to evaluate major agency actions having the potential to impact the environment and that may require the preparation of environmental assessments and more detailed environmental impact statements that may be made available for public review and comment; and • the Occupational Safety and Health Act (“OSHA”), which establishes workplace standards for the protection of the health and safety of employees, including the implementation of hazard communications programs designed to inform employees about hazardous substances in the workplace, potential harmful effects of these substances, and appropriate control measures.
For every 100,000 bpd of incremental produced water that WaterBridge brings onto our surface, we expect to generate royalty fees of $4.0 million to $6.0 million per year, including skim oil revenues. The shared management team between LandBridge and WaterBridge facilitates our common goal of capitalizing on energy production in the Permian Basin through a mutually beneficial relationship.
For every 100,000 bpd of incremental produced water that WaterBridge brings onto our surface, we expect to generate royalty fees of $4.0 million to $6.0 million per year, including skim oil royalties. The shared management team between LandBridge and WaterBridge facilitates our common goal of capitalizing on energy production in the Permian Basin through a mutually beneficial relationship.
Our agreements with Occidental Petroleum do not contain minimum volume commitments, and our revenues from Occidental Petroleum can fluctuate based on the nature, timing and scope of Occidental Petroleum’s activities on our land.
Our agreements with Occidental 19 Petroleum do not contain minimum volume commitments, and our revenues from Occidental Petroleum can fluctuate based on the nature, timing and scope of Occidental Petroleum’s activities on our land.
Over the next several years, our customers may incur certain capital expenditures for air pollution control equipment or other air emissions related issues, which could lead to an increase in our customers’ operating costs or a decrease in our or our customers’ revenues and limit future development activity by our customers, including WaterBridge and Desert Environmental, thereby reducing their demand for the use of our land and resources.
Over the next several years, our customers may incur certain capital expenditures for air pollution control equipment or other air emissions related issues, which could lead to an increase in our customers’ operating costs or a decrease in our or our customers’ revenues and limit future development activity by our customers, including WaterBridge, thereby reducing their demand for the use of our land and resources.
Our agreements with WaterBridge do not contain minimum volume commitments, and our revenues from WaterBridge can fluctuate based on the nature, timing and scope of WaterBridge’s activities on our land.
Our agreements with WaterBridge do not contain minimum volume commitments, and our revenues 18 from WaterBridge can fluctuate based on the nature, timing and scope of WaterBridge’s activities on our land.
Examples of the benefits of these relationships include WaterBridge’s strategic partnership with Devon Energy, which supports the development of significant additional infrastructure on and around our land. We believe that WaterBridge’s future growth will continue to underpin increased revenues for us, into which we have significant visibility and that requires minimal investment by us.
Examples of the benefits of these relationships include WaterBridge’s strategic relationship with Devon Energy, which supports the development of significant additional infrastructure on and around our land. We believe that WaterBridge’s future growth will continue to underpin increased revenues for us, into which we have significant visibility and that requires minimal investment by us.
In addition, our Southern Position is adjacent to the I-10 interstate highway corridor, the fourth longest interstate highway system in the country, as well as I-20, which, each individually and collectively, serve as corridors for significant vehicle traffic and for pipeline and electrical infrastructure, representing additional development opportunities for this surface acreage.
In addition, our Southern Position is adjacent to the I-10 interstate highway corridor, the fourth longest interstate highway system in the country, as well as I-20, which, each individually and 14 collectively, serve as corridors for vehicle traffic and for pipeline and electrical infrastructure, representing additional development opportunities for this surface acreage.
The terms and conditions of, and pricing for, our agreements with Occidental Petroleum are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue .” The majority of our revenues from Occidental Petroleum during the year ended December 31, 2024, were generated by damage payments under SUAs and easements, brackish water sales, produced water handling royalties 20 and oil and gas royalties, with less significant revenues generated by its other land uses.
The terms and conditions of, and pricing for, our agreements with Occidental Petroleum are consistent with the descriptions of such agreements set forth in “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue .” The majority of our revenues from Occidental Petroleum during the year ended December 31, 2025, were generated by damage payments under SUAs and easements, brackish water sales, produced water handling royalties and oil and gas royalties, with less significant revenues generated by its other land uses.
We generated less significant revenues from EOG Resources’ other land uses during the year ended December 31, 2024. Our agreements with EOG Resources do not contain minimum volume commitments, although our sand mine lease with EOG Resources contains a nominal minimum yearly royalty payment.
We generated less significant revenues from EOG Resources’ other land uses during the year ended December 31, 2025. Our agreements with EOG Resources do not contain minimum volume commitments, although our sand mine lease with EOG Resources contains a nominal minimum yearly royalty payment.
Please see “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue ” for further information regarding the ranges of our customary royalties and fees, inclusive of our royalties and fees with WaterBridge, ConocoPhillips, EOG Resources and Occidental Petroleum.
Please see “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—How We Generate Revenue ” for further information regarding the ranges of our customary royalties and fees, inclusive of our royalties and fees with WaterBridge, VTX Energy, ConocoPhillips, EOG Resources and Occidental Petroleum.
Infrastructure In order to use our surface acreage to, among other things, support all stages of energy development and production to supply growing global demand, we have entered into various SUAs through which our customers have built and own or are developing infrastructure on our land, including oil, natural gas and produced water gathering pipelines, recycled water pipelines, produced water handling facilities, water recycling ponds, a sand mine, non-hazardous oilfield reclamation and solid waste facilities, a data center and a cryptocurrency facility, as of December 31, 2024.
Infrastructure In order to use our surface acreage to, among other things, support all stages of energy development and production to supply growing global demand, we have entered into various SUAs through which our customers have built and own or are developing infrastructure on our land, including oil, natural gas and produced water gathering pipelines, recycled water pipelines, produced water handling facilities, water recycling ponds, sand mines, non-hazardous oilfield reclamation and solid waste facilities, a data center and a cryptocurrency facility, as of December 31, 2025.
As of December 31, 2024, we did not directly employ any employees. Due to our Shared Services Agreement, our business and the success thereof is dependent, in part, on the Manager’s ability to attract and retain qualified personnel.
As of December 31, 2025, we did not directly employ any employees. Due to our Shared Services Agreement, our business and the success thereof is dependent, in part, on the Manager’s ability to attract and retain qualified personnel.
In furtherance of our strategy, we and WaterBridge entered into agreements with Texas Pacific Land Company (“TPL”), one of the largest landowners in Texas, to provide reciprocal crossing rights and produced water royalty and revenue sharing across an area of mutual interest that 11 provides our customers (including WaterBridge) with greater development efficiency and enables them to increase their operations on our land.
In furtherance of our strategy, we and WaterBridge entered into agreements with Texas Pacific Land Corporation (“TPL”), one of the largest landowners in Texas, to provide reciprocal crossing rights and produced water royalty and revenue sharing across an area of mutual interest that provides our customers (including WaterBridge) with greater development efficiency and enables them to increase their operations on our land.
These resources are used by our customers in their projects on and around our land and elsewhere throughout the Delaware Basin. • Oil and Gas Royalties: We receive a share of recurring revenues from the production of oil and natural gas on our 4,424 gross mineral acres through our ownership of mineral interests, of which approximately 96% underlie our surface acreage.
These resources are used by our customers in their projects on and around our land and elsewhere throughout the Delaware Basin. • Oil and Gas Royalties: We receive a share of recurring revenues from the production of oil and natural gas on our approximate 4,400 gross mineral acres through our ownership of mineral interests, of which approximately 96% underlie our surface acreage.
Various producers have operations on or in the vicinity of our Southern Position, including ConocoPhillips, VTX Energy, APA Corporation, Permian Resources and Diamondback Energy, and we generate revenues from their use of our Southern Position acreage and its resources.
Various producers have operations on or in the vicinity of our Southern Position, including Crescent Energy, VTX Energy, APA Corporation, Permian Resources and Diamondback Energy, and we generate revenues from their use of our Southern Position acreage and its resources.
However, several groups have filed litigation over this December 2020 decision, and the Biden Administration subsequently announced plans to reconsider the December 2020 final action in favor of a more stringent ground-level ozone NAAQS.
However, several groups filed litigation over the December 2020 decision, and the Biden Administration subsequently announced plans to reconsider the December 2020 final action in favor of a more stringent ground-level ozone NAAQS.
We intend for our website to be a forum of public dissemination for purposes of Regulation FD.
We intend for our website to be a forum of public dissemination for purposes of Regulation FD. 29
Pursuant to the Shared Services Agreement, the Manager provides us with the services of our senior executive management team and certain management services, as well as general, administrative, overhead and operating services to support our business and development activities, including by making available four full-time personnel exclusively providing field services on our surface acreage and three full-time corporate services personnel exclusively providing corporate services to us.
Pursuant to the Shared Services Agreement, the Manager provides us with the services of our senior executive management team and certain management services, as well as general, administrative, overhead and operating services to support our business and development activities, including by making available five full-time personnel exclusively providing field services on our surface acreage and five full-time corporate services personnel exclusively providing corporate services to us.
In addition, the Inflation Reduction Act of 2022 (the “IRA”) amends the CAA to impose a fee on the emission of methane from sources required to report their GHG emissions to the EPA, including those sources in the onshore petroleum and natural gas production and gathering and boosting source categories.
In addition, the Inflation Reduction Act of 2022 (the “IRA”) amended the CAA to impose a fee on the emission of excess methane from sources required to report their GHG emissions to the EPA, including those sources in the onshore petroleum and natural gas production and gathering and boosting source categories.
We receive a fixed 16 royalty per ton of sand extracted, as well as a fixed-fee per barrel of brackish water used to support sand mining operations.
We receive a fixed 15 royalty per ton of sand extracted, as well as a fixed-fee per barrel of brackish water used to support sand mining operations.
The lease development agreement includes, among other things, a non-refundable deposit and a two-year site selection and pre-development period; and • surface use agreements with Desert Reclamation LLC and Safefill Pecos, LLC, each a subsidiary of Desert Environmental, each with an initial term of 10 years and automatic one-year renewals unless terminated by either party prior to renewal, 22 pursuant to which we have granted certain exclusive rights to construct, operate and maintain non-hazardous oilfield reclamation and solid waste facilities on our land and we receive a percentage of gross revenue from solid waste disposal and reclamation, as well as additional revenue from providing water for landfill operations and fees for surface damages, which surface damage payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar payments in the immediate vicinity of our land.
The lease development agreement includes, among other things, a non-refundable deposit and a two-year site selection and pre-development period; and • surface use agreements with WaterBridge, each with an initial term of 10 years and automatic one-year renewals unless terminated by either party prior to renewal, pursuant to which we have granted certain exclusive rights to construct, operate and maintain non-hazardous waste management facilities on our land and we receive a percentage of gross revenue from solid waste disposal and reclamation, as well as additional revenue from providing water for landfill operations and fees for surface damages, which surface damage payments are based on market rates and subject to annual redetermination by us in our reasonable discretion, taking into account market rates for similar payments in the immediate vicinity of our land.
Pursuant to the Shared Services Agreement, the Manager also provides operational and maintenance services, such as project and construction management, and provides operating materials and equipment. Because our customers construct and operate almost all of the infrastructure installed on our acreage, we have and expect to maintain a minimal number of employees.
Pursuant to the Shared Services Agreement, the Manager also provides operational and maintenance services, such as project and construction management, and provides operating materials and equipment. Because our customers construct and operate almost all of the infrastructure installed on our acreage, we expect to maintain a minimal number of dedicated personnel.
Our customers generally consist of a limited universe of entities operating on and around our acreage in the Delaware Basin.
Our customers generally consist of a limited number of entities operating on and around our acreage in the Delaware Basin.
WaterBridge is one of the largest water midstream companies in the United States and operates a large-scale network of pipelines and other infrastructure in the Delaware Basin that, as of December 31, 2024, handles approximately 2.0 million bpd of water associated with oil and natural gas production, with approximately 3.4 million bpd of total handling capacity.
WaterBridge is one of the largest water midstream companies in the United States and operates a large-scale network of pipelines and other infrastructure in the Delaware Basin that, as of December 31, 2025, handles approximately 2.5 million bpd of water associated with oil and natural gas production, with approximately 4.2 million bpd of total handling capacity.
Overview of our Land Position Our Stateline Position Our Stateline Position consists of approximately 137,000 surface acres located primarily in Loving, Reeves and Winkler Counties, Texas, and Lea County, New Mexico, near and along the Texas-New Mexico state border, as of December 31, 2024.
Overview of our Land Position Our Stateline Position Our Stateline Position consists of approximately 169,000 surface acres located primarily in Loving, Reeves and Winkler Counties, Texas, and Lea County, New Mexico, near and along the Texas-New Mexico state border, as of December 31, 2025.
Item 1. Business LandBridge was formed on September 27, 2023 as a Delaware limited liability company to serve as the issuer in an initial public offering of equity, which closed on July 1, 2024 (the “IPO”). LandBridge is a holding company, the sole material asset of which is membership interests in OpCo.
Item 1. Business LandBridge was formed on September 27, 2023 as a Delaware limited liability company to serve as the issuer in an initial public offering of equity, which closed on July 1, 2024 (the “IPO”). LandBridge is a holding company, the principal asset of which is membership interests in OpCo. LandBridge is also the sole managing member of OpCo.
We also believe that our large land position strategically located at the intersection of significant producer activity and access to largely underutilized pore space offers critical capacity for produced water disposal, along with our management team’s extensive experience in the produced water industry, uniquely positions us to provide producers and produced water companies with access to our land and pore space to establish large-scale, reliable produced water handling solutions, from which we will generate multiple revenue streams, including the sale of resources from our land and produced water handling royalties. 13 Our Assets We own approximately 273,000 surface acres in and around the Delaware Basin in Texas and New Mexico, the most active oil and natural gas development and production region of the United States, as of December 31, 2024.
We also believe that our large land position strategically located at the intersection of significant producer activity and access to largely underutilized pore space offers critical capacity for produced water disposal, along with our management team’s extensive experience in the produced water industry, uniquely positions us to provide producers and produced water companies with access to our land and pore space to establish large-scale, reliable produced water handling solutions, from which we will generate multiple revenue streams, including the sale of resources from our land and produced water handling royalties. 12 Our Assets We own or manage more than 315,000 surface acres in and around the Delaware Basin in Texas and New Mexico, the most active oil and natural gas development and production region of the United States, as of December 31, 2025.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures” for more information regarding these non-GAAP measures and reconciliations to the most comparable GAAP measures.
See “ Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures” for more information regarding these non-GAAP measures and reconciliations to the most comparable GAAP measures.
Information contained on our website is not incorporated into this Annual Report or on our other filings with the SEC. Our filings are available in hard copy, free of charge, by contacting us at 5555 San Felipe Street, Suite 1200, Houston, Texas 77056, Attention: Investor Relations, telephone: (254) 776-3722.
Information contained on our website is not incorporated into this Annual Report or on our other filings with the SEC. Our filings are available in hard copy, free of charge, by contacting us at 5555 San Felipe Street, Suite 1200, Houston, Texas 77056, Attention: Investor Relations, telephone: (432) 445-3929.
WaterBridge has the right to construct produced water infrastructure on our Stateline and Northern Positions and is one of our largest customers, representing 24% of our revenue during the year ended December 31, 2024.
WaterBridge has the right to construct produced water infrastructure on our Stateline and Northern Positions and is one of our largest customers, representing 25% of our revenue during the year ended December 31, 2025.
As of December 31, 2024, WaterBridge and third party operators collectively operated approximately 1.0 million bpd of existing produced water handling capacity on our Stateline Position.
As of December 31, 2025, WaterBridge and third party operators collectively operated approximately 1.9 million bpd of existing produced water handling capacity on our Stateline Position.
Within the time period required by the SEC and the New York Stock Exchange (the “NYSE”), as applicable, we will post on our website any modifications to the foregoing 36 governance documents and any waivers applicable to senior officers as defined in the applicable governance document, as required by the Sarbanes-Oxley Act.
Within the time period required by the SEC, the New York Stock Exchange (the “NYSE”) and NYSE Texas, Inc. (“NYSE Texas”), as applicable, we will post on our website any modifications to the foregoing governance documents and any waivers applicable to senior officers as defined in the applicable governance document, as required by the Sarbanes-Oxley Act.
We have entered into, or are currently pursuing, primarily long-term commercial relationships with businesses focused on solar power generation, microgrids, power storage, cryptocurrency mining and data management, as well as other renewable energy production, among other industries and application s .
We have entered into, or are currently pursuing, primarily long-term commercial relationships with businesses focused on oil and gas development, solar power generation, microgrids, power storage, cryptocurrency mining and data management, as well as other renewable energy production, among other industries and applications.
WaterBridge’s key customers include Permian Resources, Devon Energy, Chevron, EOG Resources, Apache Corporation, Vital Energy, ConocoPhillips, San Mateo Midstream, Mewbourne Oil Company, and Diamondback Energy. As of December 31, 2024, WaterBridge handled approximately 2.2 million bpd of aggregate produced water and had approximately 4.2 million bpd of aggregate handling capacity, in each case across its aggregate areas of operation.
WaterBridge’s key customers include Devon Energy, Permian Resources, BPX Energy, Chevron, EOG Resources, APA Corporation, Vital Energy, ConocoPhillips, San Mateo Midstream and Mewbourne Oil Company. As of December 31, 2025, WaterBridge handled approximately 2.5 million bpd of aggregate produced water and had approximately 4.8 million bpd of aggregate handling capacity, in each case across its aggregate areas of operation.
Our Mineral Interests We own 4,424 gross mineral acres in the Delaware Basin with a weighted average lease royalty percentage based on acreage of 23.9% and an average proved developed producing net revenue interest per well of 4.3%, as of December 31, 2024.
Our Mineral Interests We own approximately 4,400 gross mineral acres in the Delaware Basin with a weighted average lease royalty percentage based on acreage of 23.9% and an average proved developed producing net revenue interest per well of 4.2%, as of December 31, 2025.
Pricing for our agreements with WaterBridge is consistent with the pricing described under “Management’s Discussion and Analysis of Financial Condition and Results of Operation — How we Generate Revenue.” Our revenue-generating agreements with ConocoPhillips include (i) a water purchase and access agreement with an initial term of 10 years and a perpetual term thereafter, subject to termination for non-use for more than six months, pursuant to which ConocoPhillips operates brackish water wells on our lands and we receive customary royalties for each barrel of brackish water produced from such wells, (ii) brackish water supply agreements, typically on a short-term basis, pursuant to which we sell brackish water to ConocoPhillips to be used primarily in well completions, (iii) SUAs with perpetual terms so long as ConocoPhillips conducts operations thereunder, subject to termination for non-use for more than six months, pursuant to which ConocoPhillips operates produced water recycling and treatment facilities on our land and from which we receive customary royalties and fees, (iv) customary term easements, typically for five- to 10-year terms, subject to early termination for non-use over a specified period of time and (v) customary oil and natural gas mineral leases with perpetual terms so long as ConocoPhillips conducts operations thereunder.
Our revenue-generating agreements with ConocoPhillips include (i) a water purchase and access agreement with an initial term of 10 years and a perpetual term thereafter, subject to termination for non-use for more than six months, pursuant to which ConocoPhillips operates brackish water wells on our lands and we receive customary royalties for each barrel of brackish water produced from such wells, (ii) brackish water supply agreements, typically on a short-term basis, pursuant to which we sell brackish water to ConocoPhillips to be used primarily in well completions, (iii) SUAs with perpetual terms so long as ConocoPhillips conducts operations thereunder, subject to termination for non-use for more than six months, pursuant to which ConocoPhillips operates produced water recycling and treatment facilities on our land and from which we receive customary royalties and fees, (iv) customary term easements, typically for five- to 10-year terms, subject to early termination for non-use over a specified period of time and (v) customary oil and natural gas mineral leases with perpetual terms so long as ConocoPhillips conducts operations thereunder.
Five Point indirectly owns a majority of our common shares and owns a majority of the equity interests in WaterBridge and Desert Environmental and 50% of Powered Land Partners, LLC (“PowLan”), a joint venture between a third-party developer and funds affiliated with Five Point for the development of a data center on our land.
Five Point indirectly owns a majority of our common shares, a majority of WaterBridge’s common shares and 50% of Powered Land Partners, LLC (“PowLan”), a joint venture between a third-party developer and funds affiliated with Five Point for the development of a data center on our land.
Our other revenue streams, including sales of brackish water, payments from SUAs and other surface related revenue and sales of resources, may also vary from period to period due to seasonal changes in supply and demand, and a variety of additional seasonal factors that are beyond our control and the control of producers on or around our land. 23 Our results and business are significantly dependent on our customers and their activities on our land, which are beyond our control.
Our other revenue streams, including sales of brackish water, payments from SUAs and other surface related revenue and sales of resources, may also vary from period to period due to seasonal changes in supply and demand, and a variety of additional seasonal factors that are beyond our control and the control of producers on or around our land.
Our Southern Position Our Southern Position consists of approximately 80,000 surface acres located in Reeves and Pecos Counties, Texas in the Delaware Basin as of December 31, 2024.
Our Southern Position Our Southern Position consists of approximately 87,000 surface acres located in Reeves, Ward and Pecos counties, Texas in the Delaware Basin as of December 31, 2025.
We believe that the pore space underlying our Northern Position will be able to support approximately 1.0 million bpd of additional produced water handling capacity, assuming 25,000 bpd produced water handling permits and one-mile spacing between all future produced water handling facilities.
We believe that the pore space underlying our Northern Position will be able to support approximately 1.4 million bpd of additional produced water handling capacity, assuming approximately 32,000 bpd produced water handling permits on average and one kilometer of spacing between all future produced water handling facilities.
For more information on environmental and occupational health and safety matters, see “ Risk Factors—Risks Related to Environmental and Other Regulations —Legislation or regulatory initiatives intended to address seismic activity, over-pressurization or subsidence could restrict drilling, completion and production activities, as well as WaterBridge’s ability to handle produced water gathered from its customers, which could have a material adverse effect on our results of operations, cash flows and financial position,” “ Risk Factors—Risks Related to Environmental and Other Regulations —The results of operations of our customers, as well as producers on or around our land, may be materially impacted by efforts to transition to a lower-carbon economy,” “ Risk Factors—Risks Related to Our Business and Operations —We may be subject to claims for personal injury and property damage, or for catastrophic events, which could materially and adversely affect our results of operations, cash flows and financial position,” “ Risk Factors—Risks Related to Our Business and Operations —We or our customers may be unable to obtain and renew permits necessary for operations, which could materially and adversely affect our results of operations, cash flows, and financial position” and “ Risks Related to Our Business and Operations. ” Oil, Natural Gas and NGL Data Proved Reserves Evaluation of Proved Reserves .
For more information on environmental and occupational health and safety matters, see “ Risk Factors—Risks Related to Environmental and Other Regulations —Legislation or regulatory initiatives intended to address seismic activity, over-pressurization or subsidence could restrict drilling, completion and production activities, as well as WaterBridge’s ability to handle produced water gathered from its customers, which could have a material adverse effect on our results of operations, cash flows and financial position,” “ Risk Factors—Risks Related to Environmental and Other Regulations —The results of operations of our customers, as well as producers on or around our land, may be materially impacted by efforts to transition to a lower-carbon economy,” “ Risk Factors—Risks Related to Our Business and Operations —We may be subject to claims for personal injury and property damage, or for catastrophic events, which could materially and adversely affect our results of operations, cash flows and financial position,” “ Risk Factors—Risks Related to Our Business and Operations —We or our customers may be unable to obtain and renew permits necessary for operations, which could materially and adversely affect our results of operations, cash flows, and financial position” and “ Risks Related to Our Business and Operations. ” 28 Organizational Structure; Availability of Information LandBridge was formed on September 27, 2023 as a Delaware limited liability company.
We generate multiple revenue streams from the use of our surface acreage, the sale of resources from our land and oil and gas royalties. • Surface Use Royalties and Revenues: We receive fees from our customers for the use of our surface acreage for their business operations, which currently include oil and natural gas development and production, produced water transportation and handling, pipeline and electrical infrastructure, digital infrastructure, a commercial fuel distribution facility and other commercial and industrial activities, including non-hazardous oilfield reclamation and solid waste facilities. • Resource Sales and Royalties: We receive fees from the sale of resources from our land, including sales of brackish water utilized in connection with oil and natural gas well completions, and royalties from sand extracted from our land for oil and natural gas operations.
Please see “ Business—Our Assets—Our Stateline Position ” for more information related to our agreements with TPL. 10 We generate multiple revenue streams from the use of our surface acreage, the sale of resources from our land and oil and gas royalties. • Surface Use Royalties and Revenues: We receive fees from our customers for the use of our surface acreage for their business operations, which currently include oil and natural gas development, produced water transportation and handling, pipeline and electrical infrastructure, digital infrastructure, a commercial fuel distribution facility and other commercial and industrial activities, including non-hazardous oilfield reclamation and solid waste facilities. • Resource Sales and Royalties: We receive fees from the sale of resources from our land, including sales of brackish water and caliche primarily utilized in connection with oil and natural gas well development, and royalties from sand and brackish water extracted from our land primarily utilized for oil and natural gas well completions.
In addition, we believe that the East Stateline Ranch contains substantial sand resources, which we expect to support additional sand mine developments over time and generate surface use revenue for us in connection with the utilization of our land.
These producers are subject to SUAs that govern commercial activities on the East Stateline Ranch. In addition, we believe that the East Stateline Ranch contains substantial sand resources, which we expect to support additional sand mine developments over time and generate surface use revenue for us in connection with the utilization of our land.
The following table summarizes our financial performance for the periods shown: Year Ended December 31, 2024 2023 (in thousands) Total revenues $ 109,954 $ 72,865 Net (loss) income (1) (41,479 ) 63,172 Adjusted EBITDA (2) 97,069 62,804 Cash flows from operating activities 67,636 53,042 Capital expenditures (985 ) (2,783 ) Free Cash Flow (2) 66,651 50,259 (1) Net loss for the year ended December 31, 2024, includes non-cash share-based compensation expense of $95.3 million, of which $4.0 million is attributable to RSUs issued by the Company, $72.6 million is attributable to NDB Incentive Units and $18.7 million is attributable to LBH Incentive Units.
The following table summarizes our financial performance for the periods shown: Year Ended December 31, 2025 2024 2023 (in thousands) Total revenues $ 199,093 $ 109,954 $ 72,865 Net income (loss) (1) $ 72,399 $ (41,479 ) $ 63,172 Adjusted EBITDA (2) $ 177,171 $ 97,069 $ 62,804 Cash flows from operating activities $ 126,273 $ 67,636 $ 53,042 Capital expenditures $ (4,236 ) $ (985 ) $ (2,783 ) Free Cash Flow (2) $ 122,037 $ 66,651 $ 50,259 (1) Net income for the year ended December 31, 2025, includes non-cash share-based compensation expense of $45.3 million, of which $8.8 million is attributable to RSUs issued by the Company and $36.5 million is attributable to LBH Incentive Units.
See “ —Material Contracts and Marketing ” for further information on our agreements with WaterBridge. The majority of our revenues from WaterBridge during the year ended December 31, 2024, were generated by produced water handling royalties, brackish water sales and surface use payments for infrastructure constructed on our lands, with less significant revenues generated by its other land uses.
The majority of our revenues from WaterBridge during the year ended December 31, 2025, were generated by produced water handling royalties, brackish water sales and surface use payments for infrastructure constructed on our lands, with less significant revenues generated by its other land uses.
Since we acquired our initial acreage, WaterBridge has constructed or acquired, as of December 31, 2024, approximately 767,000 bpd of water handling capacity on our land, with approximately 1.7 million bpd of permitted capacity available for future development on our land.
Since we acquired our initial acreage, WaterBridge has constructed or acquired, as of December 31, 2025, approximately 1.5 million bpd of water handling capacity on our land, with approximately 3.2 million bpd of permitted capacity available for future development on our land.
As of December 31, 2024, we owned approximately 273,000 surface acres in and around the Delaware Basin sub-region in the prolific Permian Basin, which is the most active area for oil and natural gas exploration and development in the United States.
As of December 31, 2025, we owned or managed more than 315,000 surface acres in and around the Delaware Basin sub-region in the prolific Permian Basin, which is the most active area for oil and natural gas exploration and development in the United States.
Our Northern Position Our Northern Position, which includes land positions in Eddy and Lea Counties, New Mexico and Andrews County, Texas, consists of approximately 56,000 fee-owned surface acres and 33,285 additional surface acres leased from the BLM and the State of New Mexico as of December 31, 2024.
Our Northern Position Our Northern Position, which includes land positions in Eddy and Lea counties, New Mexico and Andrews County, Texas, consists of approximately 61,000 fee-owned surface acres and 33,000 additional surface acres leased from the BLM and the State of New Mexico on a year-to-year basis as of December 31, 2025.
We are also the sole managing member of OpCo. Our principal executive office is located at 5555 San Felipe Street, Suite 1200, Houston, Texas 77056, and we have additional offices in Midland, Texas.
We are a holding company whose principal asset is membership interests in OpCo. We are also the sole managing member of OpCo. Our principal executive office is located at 5555 San Felipe Street, Suite 1200, Houston, Texas 77056, and we have an additional office in Midland, Texas.
These revenues consist of: • produced water handling fees; • skim oil royalties; and • fees associated with rights of way for pipelines, equipment and roads and related surface use permits. During the year ended December 31, 2024, we generated $26.1 million of revenues from WaterBridge.
These revenues consist of produced water handling fees, skim oil royalties, solid waste disposal and reclamation facility royalties and fees associated with rights of way for pipelines, equipment and roads and related surface use permits. During the year ended December 31, 2025, we generated $50.5 million of revenues from WaterBridge.
The EPA has, in recent years, made considerable efforts to regulate GHG emissions from oil and natural gas operations, including regulations that establish construction and operating permit reviews for GHG emissions from certain large stationary sources, require the monitoring and annual reporting of GHG emissions from certain petroleum and natural gas system sources, implement New Source Performance Standards directing the reduction of methane from certain new, modified, or reconstructed facilities in the oil and natural gas sector.
These include regulations that establish construction and operating permit reviews for GHG emissions from certain large stationary sources, require the monitoring and annual reporting of GHG emissions from certain petroleum and natural gas system sources, implement New Source Performance Standards directing the reduction of methane from certain new, modified, or reconstructed facilities in the oil and natural gas sector.
As shown in the chart below, for the year ended December 31, 2024, 60% of our total revenues were surface use royalties and revenues, 26% were resources sales and royalties and 14% were oil and gas royalties.
For the year ended December 31, 2024, 60% of our total revenues were surface use royalties and revenues, 26% were resource sales and royalties and 14% were oil and gas royalties.
In December 2024, we acquired approximately 46,000 largely contiguous surface acres in the Southern Delaware Basin known as the Wolf Bone Ranch (the “Wolf Bone Acquisition”).
In December 2024, we closed the Wolf Bone Acquisition, pursuant to which we acquired approximately 46,000 largely contiguous surface acres in the Southern Delaware Basin known as the Wolf Bone Ranch.
Within the Delaware Basin, WaterBridge has approximately 1,675 miles of pipeline with 3.4 million bpd of water handling capacity, as of December 31, 2024.
Within the Delaware Basin, WaterBridge has approximately 2,500 miles of pipeline with 4.2 million bpd of water handling capacity, as of December 31, 2025.
Due to the rule’s injunction in certain states, the implementation of the September 2023 final rule varies by state and the operative definition is different in the two states in which we currently operate.
Due to the rule’s injunction in certain states, the implementation of the September 2023 final rule varies by state and the operative definition is different in the two states in which we currently operate. However, in November 2025, the EPA and the Corps proposed a rule to further update and narrow the September 2023 definition.
To the extent, however, any rule or regulation expands the scope of the CWA’s jurisdiction, we, WaterBridge, Desert Environmental and our producers and other customers could face increased costs and delays with respect to obtaining permits for dredge and fill activities in wetland areas.
To the extent any judicial ruling or administrative rulemaking or other action changes the scope of the CWA’s jurisdiction, we, WaterBridge and our producers and other customers could face increased costs and delays with respect to obtaining permits for dredge and fill activities in wetland areas.
Each party is required to purchase all dirt, gravel and similar materials utilized in connection with such facilities on our land, as well as for all brackish water, from us. These agreements contain standard confidentiality, indemnification, insurance and change of control provisions.
Each party is required to purchase all dirt, gravel and similar materials utilized in connection with such facilities on our land, as well as for all brackish water, from us.
In the event that new federal, state or local restrictions or bans on the hydraulic fracturing process are adopted in areas where our land is located, our customers may incur additional costs or permitting requirements to comply with such requirements that may be significant in nature and our customers could experience added restrictions, delays or cancellations in their exploration, development, or production activities, which would in turn reduce the demand for use of our land and resources and have a material adverse effect on our results of operations, cash flows and financial position.
For example, in multiple annual New Mexico legislative sessions, there have been continued efforts to pause hydraulic fracturing and cease state issuance of permits for a four year time period, although none of the bills introduced on this topic have yet passed the New Mexico Legislature. 27 In the event that new federal, state or local restrictions or bans on the hydraulic fracturing process are adopted in areas where our land is located, our customers may incur additional costs or permitting requirements to comply with such requirements that may be significant in nature and our customers could experience added restrictions, delays or cancellations in their exploration, development, or production activities, which would in turn reduce the demand for use of our land and resources and have a material adverse effect on our results of operations, cash flows and financial position.
However, this rule has been subject to legal challenge and is currently enjoined in Texas. Additionally, in May 2023, the Supreme Court decided Sackett v. EPA, a case relating to the legal tests used to determine whether wetlands should be considered waters of the United States.
Additionally, in May 2023, the Supreme Court decided Sackett v. EPA, a case relating to the legal tests used to determine whether wetlands should be considered waters of the United States.
Five Point acquires and develops in-basin assets, provides growth capital and builds industry leading companies with experienced management teams and large E&P partners. As of December 31, 2024, Five Point had approximately $8 billion of assets under management.
Five Point acquires and develops in-basin assets, provides growth capital and builds industry-leading companies with experienced management teams and large E&P partners.
The listing decision for the lesser prairie chicken was challenged by the states of Texas, Kansas, and Oklahoma, and various industry groups, and the litigation remains ongoing in the U.S. District Court for the Western District of Texas.
The listing decision for the lesser prairie chicken was challenged by the states of Texas, Kansas, and Oklahoma, and various industry groups, with the U.S. District Court for the Western District of Texas vacating the rule for the northern district population segment in March 2025.
Of our gross mineral acres, approximately 96% underlie our surface acreage. Other than our gross mineral acres, we do not own the mineral interests that underlie our surface acreage. Unlike businesses that focus on buying oil and gas royalty interests, which are more directly exposed to commodity prices, our focus is on surface acreage ownership and the associated fee-based revenue.
Unlike businesses that focus on buying oil and gas royalty interests, which are more directly exposed to commodity prices, our focus is on surface acreage ownership and the associated fee-based revenue.
Furthermore, the cost of development on our land is primarily borne by our customers, allowing us to benefit from their growth on our land while deploying minimal capital of our own.
As a landowner, we benefit from these activities by charging fees and royalties based on our customers’ usage of our land and resources. Furthermore, the cost of development on our land is primarily borne by our customers, allowing us to benefit from their growth on our land while deploying minimal capital of our own.
Although we believe that we have been successful in growing our business, the Recent Acquisitions required significant capital expenditures and, as of December 31, 2024, we had $385.5 million of total debt outstanding, with working capital, defined as current 17 assets less current liabilities, of $38.9 million, and cash and cash equivalents of $37.0 million.
Although we believe that we have been successful in growing our business, the 1918 Ranch Acquisition required significant capital expenditure and, as of December 31, 2025, we had $570.7 million of total debt outstanding, with working capital, defined as current 16 assets less current liabilities, of $47.5 million, and cash and cash equivalents of $30.7 million.
We are also party to lease arrangements with respect to a portion of our oil and natural gas mineral interests.
These agreements contain standard confidentiality, indemnification, insurance and change of control provisions. 21 We are also party to lease arrangements with respect to a portion of our oil and natural gas mineral interests.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, under our First Amended and Restated Limited Liability Company Agreement (the “Operating Agreement”), for so long as LandBridge Holdings and certain affiliates beneficially own at least 40% of our outstanding common shares, we have agreed not to take, and will take all necessary action to cause our subsidiaries not to take, the following direct or indirect actions (or enter into an agreement to take such actions) without the prior consent of LandBridge Holdings: • increasing or decreasing the size of our board of directors, committees of our board of directors or boards and committees of our subsidiaries; • terminating our chief executive officer or removing the Chairman of our board of directors and/or hiring or appointing either of their successors; • agreeing to or entering into any transaction that would result in a change of control of the Company or enter into definitive agreements with respect to a change of control transaction; • incurring debt for borrowed money (or liens securing such debt) in an amount that would result in outstanding debt that exceeds our Adjusted EBITDA for the four quarter period immediately prior to the proposed date of the incurrence of such debt by 4.00 to 1.00; • authorizing, creating (by way of reclassification, merger, consolidation or otherwise) or issuing any equity securities of any kind (other than pursuant to any equity compensation plan approved by our board of directors or a committee of our board of directors or intra-company issuances among the Company and our subsidiaries); • making any voluntary election to liquidate or dissolve or commence bankruptcy or insolvency proceedings or the adoption of a plan with respect to any of the foregoing or any determination not to oppose such an action or proceeding commenced by a third party; and • selling, transferring or disposing of assets outside the ordinary course of business in a transaction or series of transactions with a fair market value in excess of 2% of our Consolidated Net Tangible Assets (as defined in the Operating Agreement) determined as of the end of the most recently completed fiscal quarter or year, as applicable, immediately prior to the proposed date of the consummation of such transaction or such series of transactions. 58 Additionally, for so long as LandBridge Holdings and certain affiliates beneficially own at least 10% of our outstanding common shares, we and our subsidiaries may not, without the approval of LandBridge Holdings, make any amendment, modification or waiver of our Operating Agreement or any other of our governing documents that materially and adversely affects LandBridge Holdings.
Biggest changeIn addition, under our First Amended and Restated Limited Liability Company Agreement (the “Operating Agreement”), for so long as LandBridge Holdings and certain affiliates beneficially own at least 40% of our outstanding common shares, we have agreed not to take, and will take all necessary action to cause our subsidiaries not to take, the following direct or indirect actions (or enter into an agreement to take such actions) without the prior consent of LandBridge Holdings: • increasing or decreasing the size of our board of directors, committees of our board of directors or boards and committees of our subsidiaries; • terminating our chief executive officer or removing the Chairman of our board of directors and/or hiring or appointing either of their successors; • agreeing to or entering into any transaction that would result in a change of control of the Company or enter into definitive agreements with respect to a change of control transaction; • incurring debt for borrowed money (or liens securing such debt) in an amount that would result in outstanding debt that exceeds our Adjusted EBITDA for the four quarter period immediately prior to the proposed date of the incurrence of such debt by 4.00 to 1.00; 49 • authorizing, creating (by way of reclassification, merger, consolidation or otherwise) or issuing any equity securities of any kind (other than pursuant to any equity compensation plan approved by our board of directors or a committee of our board of directors or intra-company issuances among the Company and our subsidiaries); • making any voluntary election to liquidate or dissolve or commence bankruptcy or insolvency proceedings or the adoption of a plan with respect to any of the foregoing or any determination not to oppose such an action or proceeding commenced by a third party; and • selling, transferring or disposing of assets outside the ordinary course of business in a transaction or series of transactions with a fair market value in excess of 2% of our Consolidated Net Tangible Assets (as defined in the Operating Agreement) determined as of the end of the most recently completed fiscal quarter or year, as applicable, immediately prior to the proposed date of the consummation of such transaction or such series of transactions.
Among other things, such provisions of our Operating Agreement include: • providing that after LandBridge Holdings and certain of its affiliates no longer beneficially own or control the voting of more than 40% of our outstanding common shares (the “Trigger Event”), our board of directors will be divided into three classes that are as nearly equal in number as is reasonably possible and each director will be assigned to one of three classes, with each class of directors elected for a three-year term to succeed the directors of the same class whose terms are then expiring; provided that LandBridge Holdings shall have the right to designate the initial class assigned to each director immediately following the occurrence of the Trigger Event; • prohibiting cumulative voting in the election of directors; • providing that after the Trigger Event, the affirmative vote of the holders of not less than 66 2/3% in voting power of all then-outstanding common shares entitled to vote generally in the election of our board of directors, voting together as a single class, will be required to remove any director from office, and such removal may only be for “cause”; • providing that after the Trigger Event, all vacancies, including newly created directorships, may, except as otherwise required by the terms of the Shareholder’s Agreement, law or, if applicable, the rights of holders of a series of preferred shares, only be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum, or by a sole remaining director; • providing that after the Trigger Event, shareholders will not be permitted to call special meetings of shareholders; • providing that after the Trigger Event, our shareholders may not act by written consent and may only act at a duly called annual or special meeting; • establish advance notice procedures with respect to shareholder proposals and nominations of persons for election to our board of directors, other than nominations made by or at the direction of our board of directors or any committee thereof; and • providing that a majority of our board of directors is expressly authorized to adopt, or to alter or repeal our Operating Agreement.
Among other things, such provisions of our Operating Agreement include: • providing that after LandBridge Holdings and certain of its affiliates no longer beneficially own or control the voting of more than 40% of our outstanding common shares (the “Trigger Event”), our board of directors will be divided into three classes that are as nearly equal in number as is reasonably possible and each director will be assigned to one of three classes, with each class of directors elected for a three-year term to succeed the directors of the same class whose terms are then expiring; provided that LandBridge Holdings shall have the right to designate the initial class assigned to each director immediately following the occurrence of the Trigger Event; • prohibiting cumulative voting in the election of directors; • providing that after the Trigger Event, the affirmative vote of the holders of not less than 66 2/3% in voting power of all then-outstanding common shares entitled to vote generally in the election of our board of directors, voting together as a single class, will be required to remove any director from office, and such removal may only be for “cause”; • providing that after the Trigger Event, all vacancies, including newly created directorships, may, except as otherwise required by the terms of the Shareholder’s Agreement, law or, if applicable, the rights of holders of a series of preferred shares, only be 53 filled by the affirmative vote of a majority of directors then in office, even if less than a quorum, or by a sole remaining director; • providing that after the Trigger Event, shareholders will not be permitted to call special meetings of shareholders; • providing that after the Trigger Event, our shareholders may not act by written consent and may only act at a duly called annual or special meeting; • establish advance notice procedures with respect to shareholder proposals and nominations of persons for election to our board of directors, other than nominations made by or at the direction of our board of directors or any committee thereof; and • providing that a majority of our board of directors is expressly authorized to adopt, or to alter or repeal our Operating Agreement.
Any material interruption in our customers’ supply chains, such as a material interruption of the resources required to drill and complete oil and natural gas wells, to construct produced water pipelines on our land and otherwise construct infrastructure and extract resources from our land, such as those resulting from interruptions in service by the third-party providers or common carriers that ship goods within our customers’ distribution channels, trade restrictions, such as changing U.S. and foreign trade policies relating to increased trade restrictions or tariffs, embargoes or customs restrictions, social or labor unrest, natural disasters, epidemics or pandemics or political disputes and military conflicts that cause a material disruption in our customers’ supply chains, could have a negative impact on our business and our profitability.
Any material interruption in our customers’ supply chains, such as a material interruption of the resources required to drill and complete oil and natural gas wells, to construct produced water pipelines on our land and otherwise construct infrastructure and extract resources from our land, such as those resulting from interruptions in service by the third-party providers or common carriers that ship goods within our customers’ distribution channels, trade restrictions, such as changing U.S. and foreign trade policies relating to 36 increased trade restrictions or tariffs, embargoes or customs restrictions, social or labor unrest, natural disasters, epidemics or pandemics or political disputes and military conflicts that cause a material disruption in our customers’ supply chains, could have a negative impact on our business and our profitability.
These risks include: • changes in the price and availability of transportation, natural gas or electricity; • unanticipated ground, grade or water conditions; • unusual or unexpected geological formations or pressures; • pit wall failures or surface rock falls; • inclement or hazardous weather conditions; 43 • environmental hazards and industrial accidents; • changes in applicable laws and regulations (or the interpretation thereof); • inability to maintain necessary permits or mining or water rights; • restrictions on blasting operations; • inability to obtain necessary mining or production equipment or replacement parts; • fires, explosions or industrial accidents or other accidents; • technical difficulties or key equipment failures; • labor disputes; • late delivery of supplies; and • facility shutdowns in response to environmental regulatory actions.
These risks include: • changes in the price and availability of transportation, natural gas or electricity; • unanticipated ground, grade or water conditions; • unusual or unexpected geological formations or pressures; • pit wall failures or surface rock falls; • inclement or hazardous weather conditions; • environmental hazards and industrial accidents; • changes in applicable laws and regulations (or the interpretation thereof); • inability to maintain necessary permits or mining or water rights; • restrictions on blasting operations; • inability to obtain necessary mining or production equipment or replacement parts; • fires, explosions or industrial accidents or other accidents; • technical difficulties or key equipment failures; • labor disputes; • late delivery of supplies; and • facility shutdowns in response to environmental regulatory actions.
Please see “ Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Dividends ” and “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources. ” 57 LandBridge Holdings has the ability to direct the voting of a majority of our common shares and control certain decisions with respect to our management and business, including certain consent rights and the right to designate more than a majority of the members of our board of directors as long as it and its affiliates beneficially own at least 40% of our outstanding common shares, as well as lesser director designation rights as long as it and its affiliates beneficially own less than 40% but at least 10% of our outstanding common shares.
Please see “ Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Dividends ” and “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources. ” LandBridge Holdings has the ability to direct the voting of a majority of our common shares and control certain decisions with respect to our management and business, including certain consent rights and the right to designate more than a majority of the members of our board of directors as long as it and its affiliates beneficially own at least 40% of our outstanding common shares, as well as lesser director designation rights as long as it and its affiliates beneficially own less than 40% but at least 10% of our outstanding common shares.
If we are unable to produce adequate brackish water supplies, our results of operations, cash flows, and financial position may be adversely affected by, among other things, the following: • a reduction in the amount of brackish water we sell and reduced revenues therefrom; • an increase in operating costs; and • an increase in capital expenditures associated with building pipelines to connect to alternative sources of brackish water supply, new wells to replace those that are no longer in service or are otherwise inadequate to meet the needs of customers, and reservoirs and other facilities to conserve or reclaim water.
If we are unable to produce adequate brackish water supplies, our results of operations, cash flows, and financial position may be adversely affected by, among other things, the following: • a reduction in the amount of brackish water we sell and reduced revenues therefrom; • an increase in operating costs; and 35 • an increase in capital expenditures associated with building pipelines to connect to alternative sources of brackish water supply, new wells to replace those that are no longer in service or are otherwise inadequate to meet the needs of customers, and reservoirs and other facilities to conserve or reclaim water.
In addition, we have limited insight into emerging trends that may adversely affect the development of such projects on our land or otherwise, and the developers of these projects, if they were to materialize, would encounter the risks and difficulties frequently experienced by growing companies and project developers in rapidly changing industries, including, unpredictable and volatile revenues, increased expenses, an uncertain regulatory environment, novel litigation and corresponding outcomes and changes in business conditions.
In addition, we have limited insight into emerging trends that may adversely affect the development of such projects on our land or otherwise, and the developers of these projects, if they were to materialize, would 34 encounter the risks and difficulties frequently experienced by growing companies and project developers in rapidly changing industries, including, unpredictable and volatile revenues, increased expenses, an uncertain regulatory environment, novel litigation and corresponding outcomes and changes in business conditions.
Our customers will be subject to all of the hazards and operating risks associated with their operations, which include oil and natural gas drilling, completion and production activities, sand mining, production and distribution of brackish water, water handling, waste disposal, construction and operation of non-hazardous oilfield reclamation and solid waste facilities, power storage, microgrids, 46 cryptocurrency mining, fuel stations, battery and/or solar facilities, and any other operations that may occur on our acreage.
Our customers will be subject to all of the hazards and operating risks associated with their operations, which include oil and natural gas drilling, completion and production activities, sand mining, production and distribution of brackish water, water handling, waste disposal, construction and operation of non-hazardous oilfield reclamation and solid waste facilities, power storage, microgrids, cryptocurrency mining, fuel stations, battery and/or solar facilities, and any other operations that may occur on our acreage.
In particular, we and our customers may be disproportionately exposed to the impact of regional supply and demand factors, delays or interruptions of production from oil and natural gas wells in this area, availability of equipment, facilities, personnel or services, market limitations, governmental regulation and political activities, processing or transportation 40 capacity constraints, natural disasters, adverse weather conditions, water shortages or other drought related conditions or interruption of the processing or transportation of oil and natural gas.
In particular, we and our customers may be disproportionately exposed to the impact of regional supply and demand factors, delays or interruptions of production from oil and natural gas wells in this area, availability of equipment, facilities, personnel or services, market limitations, governmental regulation and political activities, processing or transportation capacity constraints, natural disasters, adverse weather conditions, water shortages or other drought related conditions or interruption of the processing or transportation of oil and natural gas.
Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including: • changes in the valuation of our deferred tax assets and liabilities; • expected timing and amount of the release of any tax valuation allowances; • expansion into future activities in new jurisdictions; • the availability of tax deductions, credits, exemptions, refunds and other benefits to reduce tax liabilities; and • tax effects of share-based compensation.
Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including: 46 • changes in the valuation of our deferred tax assets and liabilities; • expected timing and amount of the release of any tax valuation allowances; • expansion into future activities in new jurisdictions; • the availability of tax deductions, credits, exemptions, refunds and other benefits to reduce tax liabilities; and • tax effects of share-based compensation.
In contrast, under the DGCL, a corporation can only indemnify directors and officers for acts and omissions if the director or officer acted in good faith, in a manner he or she reasonably believed to be in or not opposed to the best interest of the corporation, and, in a criminal action, if the officer or director had no reasonable cause to believe his or her conduct was unlawful.
In contrast, under the DGCL, a corporation can only indemnify directors and officers for acts and omissions if the director or officer acted in good faith, in a manner he or she reasonably believed to be in or not opposed 54 to the best interest of the corporation, and, in a criminal action, if the officer or director had no reasonable cause to believe his or her conduct was unlawful.
A significant portion of our acreage 49 in our Northern Position within New Mexico is currently located within SRAs that limit produced water injection into deep formations, which currently only affects one produced water handling facility on our land. There can be no assurance that additional portions of our acreage will not be included in an SRA in the future.
A significant portion of our acreage in our Northern Position within New Mexico is currently located within SRAs that limit produced water injection into deep formations, which currently only affects one produced water handling facility on our land. There can be no assurance that additional portions of our acreage will not be included in an SRA in the future.
This has, and will likely continue to result in some (and perhaps a growing number of) institutions removing from their portfolios the shares of companies that do not meet their minimum investment standards. Further, in some cases, banks and other capital providers are reassessing their capital allocation to our or our customers’ industries or making their participation uncertain.
This has, and will likely continue to result in some (and 43 perhaps a growing number of) institutions removing from their portfolios the shares of companies that do not meet their minimum investment standards. Further, in some cases, banks and other capital providers are reassessing their capital allocation to our or our customers’ industries or making their participation uncertain.
If WaterBridge is unable to enter into favorable contracts or to obtain the necessary regulatory and land use approvals on favorable terms, it may not be able to construct and operate its assets as anticipated, or at all, which could negatively affect our results of operations, cash flows and financial position.
If WaterBridge is unable to enter into favorable contracts or to obtain the necessary regulatory and land use approvals on favorable 32 terms, it may not be able to construct and operate its assets as anticipated, or at all, which could negatively affect our results of operations, cash flows and financial position.
Some E&P companies are focusing on developing and utilizing non-water fracturing techniques, including those utilizing propane, carbon dioxide or nitrogen instead of water. If producers in the Permian Basin begin to 42 shift their fracturing techniques to waterless fracturing in the development of their wells, our brackish water sales could be materially and negatively impacted.
Some E&P companies are focusing on developing and utilizing non-water fracturing techniques, including those utilizing propane, carbon dioxide or nitrogen instead of water. If producers in the Permian Basin begin to shift their fracturing techniques to waterless fracturing in the development of their wells, our brackish water sales could be materially and negatively impacted.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even if the amount borrowed remained the same, and we would be required to devote more of our cash flow to servicing our indebtedness. 54 In March 2022, the Federal Reserve began, and continued through 2023, to raise interest rates in an effort to curb inflation.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even if the amount borrowed remained the same, and we would be required to devote more of our cash flow to servicing our indebtedness. In March 2022, the Federal Reserve began, and continued through 2023, to raise interest rates in an effort to curb inflation.
In the event that we are unable to timely determine the portion of our dividends that is a “dividend” for U.S. federal income tax purposes, or a shareholder’s broker or withholding agent chooses to withhold taxes from dividends in a manner inconsistent with our determination of the amount that constitutes a “dividend” for such purposes, a 60 shareholder’s broker or other withholding agent may overwithhold taxes from dividends paid.
In the event that we are unable to timely determine the portion of our dividends that is a “dividend” for U.S. federal income tax purposes, or a shareholder’s broker or withholding agent chooses to withhold taxes from dividends in a manner inconsistent with our determination of the amount that constitutes a “dividend” for such purposes, a shareholder’s broker or other withholding agent may overwithhold taxes from dividends paid.
If that were to happen, you may lose all, or a part of, your investment in our Class A shares. 55 We do not currently have in place hedging agreements with respect to oil and natural gas production from our acreage, and we will be exposed to the impact of decreases in the price of oil and natural gas.
If that were to happen, you may lose all, or a part of, your investment in our Class A shares. We do not currently have in place hedging agreements with respect to oil and natural gas production from our acreage, and we will be exposed to the impact of decreases in the price of oil and natural gas.
Our customers are limited to entities operating on and around our acreage in the Delaware Basin. We cannot assure you that any of our customers will continue to do business with us. If these customers do not maintain their activities on or around our land, their demand for use of our land and resources will be reduced.
Our customers are limited to entities operating on and around our acreage in the Delaware Basin. 37 We cannot assure you that any of our customers will continue to do business with us. If these customers do not maintain their activities on or around our land, their demand for use of our land and resources will be reduced.
If OpCo is unable to make distributions, we may not receive adequate distributions, which could materially and adversely affect our results of operations, cash flows, financial position and ability to fund any dividends. Although we intend to continue to pay dividends on our Class A shares, we are not obligated to do so.
If OpCo is unable to make distributions, we may not receive adequate distributions, which could materially and adversely affect our results of operations, cash flows, financial position and ability to fund any dividends. 48 Although we intend to continue to pay dividends on our Class A shares, we are not obligated to do so.
Our Operating Agreement authorizes our board of directors to issue preferred shares without shareholder approval in one or more series, designate the number of shares constituting any series, and fix the rights, preferences, privileges and restrictions thereof, 62 including dividend rights, voting rights, rights and terms of redemption, redemption prices and liquidation preferences of such series.
Our Operating Agreement authorizes our board of directors to issue preferred shares without shareholder approval in one or more series, designate the number of shares constituting any series, and fix the rights, preferences, privileges and restrictions thereof, including dividend rights, voting rights, rights and terms of redemption, redemption prices and liquidation preferences of such series.
Our ability to restructure or refinance indebtedness will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of indebtedness could be on unfavorable terms, including at higher interest rates, and may require us to comply with more restrictive covenants.
Our ability to restructure or refinance indebtedness will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of indebtedness could be on unfavorable terms, including at higher interest rates, and may require us to comply with more restrictive 45 covenants.
This choice of 63 forum provision may limit a shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, employees, other personnel or agents, which may discourage such lawsuits against us and such persons.
This choice of forum provision may limit a shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, employees, other personnel or agents, which may discourage such lawsuits against us and such persons.
As a result, our prior operating history and historical financial statements may not be a reliable basis for evaluating our business prospects or the future value of our Class A shares and may make it difficult to assess our ability to operate profitably.
As a result, our prior operating history and historical financial statements may not be a reliable basis for evaluating our business prospects or the future value of our Class A shares and may make it difficult to assess our ability to operate 33 profitably.
In general, in a proceeding under the Bankruptcy Code, 45 the bankrupt customer or producer would have a substantial period of time to decide whether to ultimately reject or assume our agreement, which could prevent the execution of a new agreement or the assignment of the existing agreement to another customer or producer.
In general, in a proceeding under the Bankruptcy Code, the bankrupt customer or producer would have a substantial period of time to decide whether to ultimately reject or assume our agreement, which could prevent the execution of a new agreement or the assignment of the existing agreement to another customer or producer.
Damage or interruption to information technology systems could result in significant costs and may lead to significant liability, loss of critical data, reputational damage, and disruptions to services or operations. 47 Threats to information technology systems associated with cybersecurity risks and cyber incidents or attacks continue to grow.
Damage or interruption to information technology systems could result in significant costs and may lead to significant liability, loss of critical data, reputational damage, and disruptions to services or operations. Threats to information technology systems associated with cybersecurity risks and cyber incidents or attacks continue to grow.
As a result, a significant decrease in the price of oil and natural gas or decrease in levels of production of oil and natural gas on and around our land could adversely affect our results of operations, cash flows and financial 37 position.
As a result, a significant decrease in the price of oil and natural gas or decrease in levels of production of oil and natural gas on and around our land could adversely affect our results of operations, cash flows and financial position.
Due to these existing and potential future affiliations, such directors and officers may present potential business opportunities to other entities prior 59 to presenting them to us, which could cause additional conflicts of interest.
Due to these existing and potential future affiliations, such directors and officers may present potential business opportunities to other entities prior to presenting them to us, which could cause additional conflicts of interest.
For example, we cannot control whether a producer chooses to develop a property or the success of drilling and development activities, which depend on a number of factors under the control of such producer.
For example, we cannot 30 control whether a producer chooses to develop a property or the success of drilling and development activities, which depend on a number of factors under the control of such producer.
This has been linked to various geo-and environmental hazards, such as alteration of local ecosystems and impacts upon local communities, to include increased seismic activity and the formation of sinkholes.
This has been linked to various geo-and environmental hazards, such as alteration of local ecosystems and impacts upon local 41 communities, to include increased seismic activity and the formation of sinkholes.
As a result of the above, in the event of the occurrence of a default under our credit facility, the administrative agent may enforce its security interests (for the ratable benefit of the lenders under our credit facility and the other secured parties) over our and/or our subsidiaries’ assets that secure the obligations under our credit facility, take control of our assets and business, force us to seek bankruptcy protection, or force us to curtail or abandon our current business plans.
As a result of the above, in the event of the occurrence of a default under the 2025 Revolving Credit Facility, the administrative agent may enforce its security interests (for the ratable benefit of the lenders under the 2025 Revolving Credit Facility and the other secured parties) over our and/or our subsidiaries’ assets that secure the obligations under the 2025 Revolving Credit Facility, take control of our assets and business, force us to seek bankruptcy protection, or force us to curtail or abandon our current business plans.
Furthermore, certain public statements with respect to ESG matters, such as emissions reduction goals, other environmental targets, or other commitments addressing certain social issues, are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing” (i.e., misleading information or false claims overstating potential ESG benefits).
Furthermore, certain public statements with respect to sustainability matters, such as emissions reduction goals, other environmental targets, or other commitments addressing certain social issues, are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing” (i.e., misleading information or false claims overstating potential sustainability benefits).
In addition, failure or a perception (whether or not valid) of failure to adequately pursue or implement ESG strategies or achieve ESG goals or commitments, which are often aspirational, including any GHG reduction or neutralization goals or commitments, could result in litigation and damage our reputation, cause our investors or consumers to lose confidence in us, or otherwise negatively impact our operations.
In addition, failure or a perception (whether or not valid) of failure to adequately pursue or implement sustainability strategies or achieve sustainability goals or commitments, which are often aspirational, including any GHG reduction or neutralization goals or commitments, could result in litigation and damage our reputation, cause our investors or consumers to lose confidence in us, or otherwise negatively impact our operations.
Market prices for oil and natural gas are volatile and a decrease in prices could reduce drilling, completion and production activities by producers on or around our land, resulting in a reduction in the use of our land and resources and WaterBridge’s and Desert Environmental’s services, as well as the amount of revenues we receive from the production of oil and natural gas.
Market prices for oil and natural gas are volatile and a decrease in prices could reduce drilling, completion and production activities by producers on or around our land, resulting in a reduction in the use of our land and resources and WaterBridge’s services, as well as the amount of revenues we receive from the production of oil and natural gas.
Moreover, even if we voluntarily elect to pursue climate or ESG goals, we cannot guarantee that we will be able to pursue or implement such goals because of potential costs, technical or operational obstacles, uncertainty in long-term assumptions and expectations or other market or technological developments beyond our control.
Moreover, even if we voluntarily elect to pursue climate or sustainability goals, we cannot guarantee that we will be able to pursue or implement such goals because of potential costs, technical or operational obstacles, uncertainty in long-term assumptions and expectations or other market or technological developments beyond our control.
While such ratings do not impact all investors’ investment or voting decisions, unfavorable ESG ratings may lead to increased negative investor sentiment toward us or our customers and to the diversion of investment to other industries, which could have a negative impact on our share price and/or our access to and costs of capital.
While such ratings do not impact all investors’ investment or voting decisions, unfavorable sustainability ratings may lead to increased negative investor sentiment toward us or our customers and to the diversion of investment to other industries, which could have a negative impact on our share price and/or our access to and costs of capital.
Any such event could lead to significant liability, loss of critical data, reputational damage and disruptions to our services or operations. While we have implemented and maintain commercially reasonable security measures and safeguards, such security measures and safeguards may not be sufficient to protect against an attack.
Any such event could lead to significant liability, loss of critical data, reputational damage and disruptions to our services or operations. While we have implemented and maintain commercially reasonable security measures and safeguards, such security measures and safeguards may not be sufficient to protect against or effectively mitigate an attack.
To the extent OpCo has available cash we intend to cause OpCo to make (i) generally pro rata distributions to all holders of OpCo Units (“OpCo Unitholders”), including us, in an amount at least sufficient to allow us to pay taxes, (ii) additional distributions in an amount generally intended to allow the OpCo Unitholders (other than us) to satisfy their respective income tax liabilities with respect to their allocable share of the income of OpCo (based on certain assumptions and conventions), which additional distributions may be made on a pro rata basis to all OpCo Unitholders (including us) or a non-pro rata basis to OpCo Unitholders (other than us) in redemption of OpCo Units from such holders and (iii) non-pro rata distributions to us in an amount sufficient to cover our public company and other overhead expenses.
To the extent OpCo has available cash we intend to cause OpCo to make (i) generally pro rata distributions to all holders (“OpCo Unitholders”) of limited liability interests in OpCo (“OpCo Units”), including us, in an amount at least sufficient to allow us to pay taxes, (ii) additional distributions in an amount generally intended to allow the OpCo Unitholders (other than us) to satisfy their respective income tax liabilities with respect to their allocable share of the income of OpCo (based on certain assumptions and conventions), which additional distributions may be made on a pro rata basis to all OpCo Unitholders (including us) or a non-pro rata basis to OpCo Unitholders (other than us) in redemption of OpCo Units from such holders and (iii) non-pro rata distributions to us in an amount sufficient to cover our public company and other overhead expenses.
A sustained decline in oil and natural gas prices may reduce the amount of oil and natural gas that can be produced economically by producers on or around our land, which may reduce such producers’ willingness to develop such land and use our land and resources and WaterBridge’s and Desert Environmental’s services.
A sustained decline in oil and natural gas prices may reduce the amount of oil and natural gas that can be produced economically by producers on or around our land, which may reduce such producers’ willingness to develop such land and use our land and resources and WaterBridge’s services.
Any alleged claims of greenwashing against us or others in our industry may lead to further negative sentiment and diversion of investments. We could also face increasing costs as we attempt to comply with and navigate further regulatory ESG-related focus and scrutiny.
Any alleged claims of greenwashing against us or others in our industry may lead to further negative sentiment and diversion of investments. We could also face increasing costs as we attempt to comply with and navigate further regulatory sustainability-related focus and scrutiny.
Demand for the use of our land and resources, as well as the services provided by WaterBridge and Desert Environmental, depends substantially on capital spending by producers to construct and maintain infrastructure on and around our acreage and explore for, develop and produce oil and natural gas in the area.
Demand for the use of our land and resources, as well as the services provided by WaterBridge, depends substantially on capital spending by producers to construct and maintain infrastructure on and around our acreage and explore for, develop and produce oil and natural gas in the area.
If E&P companies do not maintain such activities on or around our land, their demand for the use of our land and resources and WaterBridge’s and Desert Environmental’s services will decline, negatively impacting our results of operations, cash flows and financial position.
If E&P companies do not maintain such activities on or around our land, their demand for the use of our land and resources and WaterBridge’s services will decline, negatively impacting our results of operations, cash flows and financial position.
Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on expectations and assumptions or hypothetical scenarios that may be incorrect or may change with the passage of time.
Moreover, while we may create and publish voluntary disclosures regarding sustainability matters from time to time, many of the statements in those voluntary disclosures are based on expectations and assumptions or hypothetical scenarios that may be incorrect or may change with the passage of time.
Such expectations and assumptions or hypothetical scenarios are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established approach to identifying, measuring and reporting on many ESG matters.
Such expectations and assumptions or hypothetical scenarios are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established approach to identifying, measuring and reporting on many sustainability matters.
This, in turn, could lead to lower demand for the use of our land and resources or WaterBridge’s and Desert Environmental’s services, delays in payment of, or nonpayment of, amounts that are owed to us and cause lower rates and lower utilization of our land.
This, in turn, could lead to lower demand for the use of our land and resources or WaterBridge’s services, delays in payment of, or nonpayment of, amounts that are owed to us and cause lower rates and lower utilization of our land.
Additionally, the FWS may make determinations on the listing of unlisted species as endangered or threatened under the ESA. For example, in November 2022, the FWS designated two distinct population segments of the lesser prairie chicken under the ESA, which live in certain areas in southeastern New Mexico and western Texas; however, the U.S.
Additionally, the FWS may make determinations on the listing of unlisted species as endangered or threatened under the ESA. For example, in November 2022, the FWS designated two distinct population segments of the lesser prairie chicken under the ESA, which live in certain areas in southeastern New Mexico and western Texas.
This renouncing of our interest and expectancy in any business opportunity may create actual and potential conflicts of interest between us and LandBridge Holdings, Five Point and WaterBridge, and result in less than favorable treatment of us and our shareholders if attractive business opportunities are pursued by LandBridge Holdings, Five Point and WaterBridge, for its own benefit rather than for ours.
This renouncing of our interest and expectancy in any business opportunity may create actual and potential conflicts of interest between us and LandBridge Holdings, Five Point and WaterBridge, and result in less than favorable treatment of us and our 50 shareholders if attractive business opportunities are pursued by LandBridge Holdings, Five Point and WaterBridge, for their own benefit rather than for ours.
A breach of compliance with any restriction or covenant in our credit facility or any of our future debt agreements could result in a default under the terms of the applicable agreement, and our ability to comply with such restrictions and covenants may be affected by events beyond our control.
A breach of compliance with any restriction or covenant in the 2025 Revolving Credit Facility, the Indenture or any of our future debt agreements could result in a default under the terms of the applicable agreement, and our ability to comply with such restrictions and covenants may be affected by events beyond our control.
Additionally, voluntary disclosures regarding ESG matters, as well as any ESG disclosures mandated by law, could result in litigation or government investigations or enforcement action regarding the sufficiency or validity of such disclosures.
Additionally, voluntary disclosures regarding sustainability matters, as well as any sustainability disclosures mandated by law, could result in litigation or government investigations or enforcement action regarding the sufficiency or validity of such disclosures.
Our reliance on WaterBridge and its personnel to manage and operate our business exposes us to certain risks. Pursuant to the Shared Services Agreement, WaterBridge provides general and administrative services, as well as limited operational and maintenance services to us, together with four dedicated employees providing field services and three dedicated employees providing corporate services.
Our reliance on WaterBridge and its personnel to manage and operate our business exposes us to certain risks. Pursuant to the Shared Services Agreement, WaterBridge provides general and administrative services, as well as limited operational and maintenance services to us, together with five dedicated employees providing field services and five dedicated employees providing corporate services.
We are a “controlled company” within the meaning of the NYSE rules and, as a result, qualify for and intend to rely on exemptions from certain corporate governance requirements. LandBridge Holdings holds a majority of the voting power of our common shares. As a result, we are a controlled company within the meaning of the NYSE rules.
We are a “controlled company” within the meaning of the NYSE and NYSE Texas rules and, as a result, qualify for and intend to rely on exemptions from certain corporate governance requirements. LandBridge Holdings holds a majority of the voting power of our common shares.
Subject to certain exceptions, our customers assume responsibility for, including control and removal of, all other pollution or contamination that may result from their operations on our acreage, such as Desert Environmental’s oil reclamation, solid waste and landfill operations.
Subject to certain exceptions, our customers assume responsibility for, including control and removal of, all other pollution or contamination that may result from their operations on our acreage, such as WaterBridge’s oil reclamation, solid waste and landfill operations.
Such individuals hold positions with our affiliates, including Five Point, WaterBridge and Desert Environmental, and dedicate a portion of their time and resources to the activities of such affiliates, and there can be no assurance as to the future allocation of time and resources between our business, on the one hand, and our affiliates in which our employees, other service providers, and management team hold an interest, on the other hand.
Such individuals hold positions with our affiliates, including Five Point and WaterBridge, and dedicate a portion of their time and resources to the activities of such affiliates, and there can be no assurance as to the future allocation of time and resources between our business, on the one hand, and our affiliates in which our personnel, other service providers, and management team hold an interest, on the other hand.
If we fail to comply with the restrictions and covenants in our credit facility or our future debt agreements, there could be an event of default under the terms of such agreements, which could result in an acceleration of payment.
If we fail to comply with the restrictions and covenants in the 2025 Revolving Credit Facility, the Indenture or our future debt agreements, there could be an event of default under the terms of such agreements, which could result in an acceleration of payment.
Additionally, we may not be able to amend our credit agreement or such future agreements governing our indebtedness or obtain necessary waivers on satisfactory terms. Our obligations under our credit facility are secured by a first priority security interest in substantially all of our assets and various guarantees.
Additionally, we may not be able to amend the 2025 Revolving Credit Facility or such future agreements governing our indebtedness or obtain necessary waivers on satisfactory terms. Our obligations under the 2025 Revolving Credit Facility are secured by a first priority security interest in substantially all of our assets and various guarantees.
The amounts borrowed pursuant to the terms of our credit agreement are secured by substantially all of our and our subsidiaries’ present and after-acquired assets. Additionally, our obligations under our credit facility are jointly and severally guaranteed by us and our material subsidiaries.
The amounts borrowed pursuant to the terms of the 2025 Revolving Credit Facility are secured by substantially all of our and our subsidiaries’ present and after-acquired assets. Additionally, our obligations under the 2025 Revolving Credit Facility are jointly and severally guaranteed by us and our material subsidiaries.
Companies that do not adapt to or comply with investor or stakeholder expectations and standards, which are evolving, or which are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, may suffer from reputational damage and the business, financial condition, and/or stock price of such a company could be materially and adversely affected.
Companies that do not adapt to or comply with investor or stakeholder expectations and standards, which are evolving, or which are perceived to have not responded appropriately to sustainability issues, regardless of whether there is a legal requirement to do so, may suffer from reputational damage and the business, financial condition, and/or stock price of such a company could be materially and adversely affected.
We are required, under Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting beginning in the year following this Annual Report. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting.
We are required, under Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting.
Prices for oil and natural gas may fluctuate widely in response to relatively minor changes in supply and demand, market uncertainty and a variety of additional factors that are beyond our control and the control of producers on or around our land, such as: • general market conditions, including macroeconomic trends, inflation, interest rates and associated policies of the Federal Reserve; • the domestic and foreign supply of and demand for oil and natural gas; • the price and quantity of foreign imports and U.S. exports of oil and natural gas; • market expectations about future prices of oil and natural gas; • oil and natural gas drilling, completion and production activities and the cost of such activities; • political and economic conditions and events domestically and in foreign oil and natural gas producing countries, including embargoes, increased hostilities in the Middle East, and other sustained military campaigns, the Russia-Ukraine war, as well as the Israel-Hamas conflict, conditions in South America, Central America, China and Russia, and acts of terrorism or sabotage; • the ability of and actions taken by members of OPEC+ and other oil-producing nations in connection with their arrangements to maintain oil prices and production controls; • the impact on worldwide economic activity of an epidemic, outbreak or other public health event; • the level of consumer product demand and any efforts that may negatively impact the future production of oil and natural gas; • weather conditions, such as winter storms, fires, earthquakes and flooding, and other natural disasters; • the level of U.S. domestic oil and natural gas production; • U.S. and non-U.S. governmental regulations and energy policy, including environmental initiatives and taxation; • changes in global and domestic political and economic conditions, both generally and in the specific markets in which we operate, including the impact related to changing U.S. and foreign trade policies, such as increased trade restrictions or tariffs; • the effects of litigation; 38 • physical, electronic and cybersecurity breaches; • the proximity, cost, availability and capacity of oil and natural gas pipelines and other transportation infrastructure; • technological advances affecting energy consumption, energy storage and energy supply; • the price and availability of alternative fuels and any efforts to transition to a low-carbon economy; and • the impact of energy conservation efforts.
Prices for oil and natural gas may fluctuate widely in response to relatively minor changes in supply and demand, market uncertainty and a variety of additional factors that are beyond our control and the control of producers on or around our land, such as: • general market conditions, including macroeconomic trends, inflation, interest rates and associated policies of the Federal Reserve; • the domestic and foreign supply of and demand for oil and natural gas; • the price and quantity of foreign imports and U.S. exports of oil and natural gas; • market expectations about future prices of oil and natural gas; • oil and natural gas drilling, completion and production activities and the cost of such activities; • political and economic conditions and events domestically and in foreign oil and natural gas producing countries, including embargoes, increased hostilities in the Middle East, and other sustained military campaigns, the Russia-Ukraine war, as well as the Israel-Hamas conflict, conditions in South America, Central America, China and Russia, and acts of terrorism or sabotage; • the ability of and actions taken by members of OPEC+ and other oil-producing nations in connection with their arrangements to maintain oil prices and production controls; • the impact on worldwide economic activity of an epidemic, outbreak or other public health event; • the level of consumer product demand and any efforts that may negatively impact the future production of oil and natural gas; • weather conditions, such as winter storms, fires, earthquakes and flooding, and other natural disasters; • the level of U.S. domestic oil and natural gas production; • U.S. and non-U.S. governmental regulations and energy policy, including environmental initiatives and taxation; • changes in global and domestic political and economic conditions, both generally and in the specific markets in which we operate, including the impact related to changing U.S. and foreign trade policies, such as increased trade restrictions or tariffs; • the effects of litigation; • physical, electronic and cybersecurity breaches; • the proximity, cost, availability and capacity of oil and natural gas pipelines and other transportation infrastructure; • technological advances affecting energy consumption, energy storage and energy supply; • the price and availability of alternative fuels and any efforts to transition to a low-carbon economy; and • the impact of energy conservation efforts. 31 These factors have at times resulted in, and may in the future result in, a reduction in global economic activity and volatility in the global financial markets and make it extremely difficult to predict future oil and natural gas price movements with certainty.
Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the rules of the NYSE.
Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the rules of the NYSE and NYSE Texas.
We expect to continue to depend on key customers to support our revenues for the foreseeable future, and although each of WaterBridge, ConcoPhillips and EOG Resources operates on our land under long-term contracts, each of these customers has the right to reduce or cease operations on our acreage at their sole discretion under certain circumstances, as our contracts with such customers generally do not contain minimum commitment provisions for land use or brackish water volumes to be purchased.
We expect to continue to depend on key customers to support our revenues for the foreseeable future, and although each of WaterBridge, VTX Energy and ConocoPhillips operates on our land under long-term contracts, each of these customers has the right to reduce or cease operations on our acreage at their sole discretion under certain circumstances, as our contracts with such customers generally do not contain minimum commitment provisions for land use or brackish water volumes to be purchased.
Alternatively, we may be required to undertake a future public or private offering of Class A shares and use the net proceeds from such offering to purchase an equal number of OpCo Units, with the cancellation of a corresponding number of Class B shares, from LandBridge Holdings.
Alternatively, we may be required to undertake a future public or private offering of Class A shares and use the net proceeds from such offering to purchase an equal number of OpCo Units, with the cancellation of a corresponding number of Class B shares, from LandBridge Holdings. We may sell additional Class A shares in future offerings.
Similarly, we cannot guarantee that participation in any sustainability, climate-related, or ESG certification program or framework will have the intended results on our ESG profile. In addition, certain organizations that provide proxy advisory services to investors on corporate governance and related matters have developed ratings processes for evaluating companies on their approach to ESG matters.
Similarly, we cannot guarantee that participation in any sustainability or, climate-related certification program or framework will have the intended results on our sustainability profile. In addition, certain organizations that provide proxy advisory services to investors on corporate governance and related matters have developed rating and proxy voting recommendation processes for evaluating companies on their approach to sustainability matters.
Compliance with these requirements will strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.
Compliance with these requirements will increase demands on our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.
There can be no assurance that we or our customers would be able to recover any expenditures or costs associated with the impact of climate variability and related laws and regulations on a timely basis, or at all. Increased investor attention to environmental, social, and governance (“ESG”) matters may impact our or our customers’ business.
There can be no assurance that we or our customers would be able to recover any expenditures or costs associated with the impact of climate variability and related laws and regulations on a timely basis, or at all. Increased investor attention to sustainability-related matters may impact our or our customers’ business.
WaterBridge is, and Desert Environmental is anticipated to be, among our most significant customers and are expected to play an increasingly important role in our financial performance over the long term. Accordingly, we are indirectly subject to the business risks faced by WaterBridge and Desert Environmental.
WaterBridge is among our most significant customers and is expected to play an increasingly important role in our financial performance over the long term. Accordingly, we are indirectly subject to the business risks faced by WaterBridge.
Because a significant portion of our revenues is derived from WaterBridge and Desert Environmental, any development that materially and adversely affects either of WaterBridge’s or Desert Environmental’s businesses, operations or financial condition could have a material adverse impact on us.
Because a significant portion of our revenues is derived from WaterBridge, any development that materially and adversely affects WaterBridge’s businesses, operations or financial condition could have a material adverse impact on us.
Our reliance on these third parties means that any vulnerability in their systems could propagate to our own systems, increasing our risk exposure despite our internal controls.
Our reliance on these third parties means that any vulnerability in their systems could propagate to our own systems or affect our data, increasing our risk exposure despite our internal controls.
We are continuing our efforts to: • institute a more comprehensive compliance function; • comply with rules promulgated by the NYSE; • prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws; • accurately implement and interpret GAAP; • institute and enforce new internal policies, such as those relating to insider trading; and • involve and retain to a greater degree outside counsel and accountants in the above activities.
We are continuing our efforts to: 47 • institute a more comprehensive compliance function; • comply with rules promulgated by the NYSE and NYSE Texas; • continue to prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws; • institute and enforce new internal policies, such as those relating to insider trading; and • involve and retain to a greater degree outside counsel and accountants in the above activities.
Companies across all industries are facing increasing scrutiny from stakeholders related to their ESG practices.
Companies across all industries are facing increasing scrutiny from stakeholders related to their sustainability practices.
Our ability to grow will depend on a number of factors, including: • investment by our customers in infrastructure on or around our land; • the amount of brackish water use and associated prices for such brackish water; • the results of drilling operations on and in proximity to our land; • future and existing limitations imposed by law or environmental regulations; • oil and natural gas prices; • our ability to develop existing and future projects, including sand mines, solar projects and data centers; • our ability to identify and acquire additional acreage; • our or the Manager’s ability to continue to retain and attract skilled personnel, and our ability to contract for the services of key personnel who are sufficiently dedicated to performing services with respect to our business; • our ability to maintain or enter into new relationships with customers; • our or our customers’ ability to obtain rights from our neighboring landowners on economic terms, or at all, to gain access to our land or transport resources, such as sand and brackish water, away from our land, to their point of end use; and • our access to, and cost of, capital in the event we pursue future acquisitions. 41 We may also be unable to make attractive acquisitions, which could inhibit our ability to grow, or we could experience difficulty commercializing any acquired acreage.
Our ability to grow will depend on a number of factors, including: • investment by our customers in infrastructure on or around our land; • the amount of brackish water use and associated prices for such brackish water; • the results of drilling operations on and in proximity to our land; • future and existing limitations imposed by law or environmental regulations; • oil and natural gas prices; • our ability to develop existing and future projects, including sand mines, solar projects and data centers; • our ability to identify and acquire additional acreage; • our or the Manager’s ability to continue to retain and attract skilled personnel, and our ability to contract for the services of key personnel who are sufficiently dedicated to performing services with respect to our business; • our ability to maintain or enter into new relationships with customers; • our or our customers’ ability to obtain rights from our neighboring landowners on economic terms, or at all, to gain access to our land or transport resources, such as sand and brackish water, away from our land, to their point of end use; and • our access to, and cost of, capital in the event we pursue future acquisitions.
A substantial or extended decline in oil and natural gas prices may adversely affect our results of operations, cash flows and financial position. ” For the year ended December 31, 2024, we received revenue from approximately 186 customers, and our top ten customers represented 78% of our total revenues.
A substantial or extended decline in oil and natural gas prices may adversely affect our results of operations, cash flows and financial position. ” For the year ended December 31, 2025, we received revenue from approximately 208 customers, and our top ten customers represented 73% of our total revenues.
The SUAs we enter into and the sand, brackish water and other resources that we or our customers sell are substantially dependent on drilling, completion and production activities by E&P companies on or around our acreage. Similarly, the services WaterBridge and Desert Environmental provide from which we earn royalties and fees are substantially dependent on those same activities.
The SUAs we enter into and the sand, brackish water and other resources that we or our customers sell are substantially dependent on drilling, completion and production activities by E&P companies on or around our acreage. Similarly, the services WaterBridge provides, from which we earn royalties and fees, are substantially dependent on these same activities.
Additionally, insurers may decide to raise rates and/or cease insuring us or our customers on or around our land based on climate change-related concerns. Approaches to climate change and transition to a lower-carbon economy, including government regulation, company policies, and consumer behavior, are continuously evolving.
However, this trend has been declining recently. Additionally, insurers may decide to raise rates and/or cease insuring us or our customers on or around our land based on climate change-related concerns. Approaches to climate change and transition to a lower-carbon economy, including government regulation, company policies, and consumer behavior, are continuously evolving.
We are a holding company. Our sole material asset is our equity interest in OpCo, and accordingly, we will be dependent upon distributions from OpCo to pay taxes and cover our corporate and other overhead expenses. We are a holding company and have no material assets other than our equity interest in OpCo.
We are a holding company. Our principal asset is our equity interest in OpCo, and accordingly, we will be dependent upon distributions from OpCo to pay taxes and cover our corporate and other overhead expenses. We are a holding company and have no material assets other than our equity interest in OpCo. We have no independent means of generating revenue.
To the extent that any U.S. trade policy results in retaliatory tariffs against the U.S., such as the recently announced tariffs from China on U.S. natural gas and crude oil, such developments could result in inflationary pressures and have an adverse effect on our customers’ business, and reduce demand for use of our land and services, which could have a material adverse effect on our business, results of operations and financial condition.
To the extent that any U.S. trade policy results in retaliatory tariffs against the U.S., such developments could result in inflationary pressures and have an adverse effect on our customers’ business, and reduce demand for use of our land and services, which could have a material adverse effect on our business, results of operations and financial condition.
We cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. 56 If we experience any material weaknesses in the future or otherwise fail to develop or maintain an effective system of internal controls in the future, we may not be able to accurately report our financial condition or results of operations, which may adversely affect investor confidence in us and, as a result, the value of our Class A shares.
If we experience any material weaknesses in the future or otherwise fail to develop or maintain an effective system of internal controls in the future, we may not be able to accurately report our financial condition or results of operations, which may adversely affect investor confidence in us and, as a result, the value of our Class A shares.
Risks Related to Our Corporate Structure and Our Class A Shares The requirements of being a public company, including compliance with the reporting requirements of the Exchange Act, and the requirements of the Sarbanes-Oxley Act, may strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.
Risks Related to Our Corporate Structure and Our Class A Shares Maintaining the requirements of being a public company, including compliance with the reporting requirements of the Exchange Act, and the requirements of the Sarbanes-Oxley Act, will increase demands on our resources, increase our costs and divert management’s attention, and we may be unable to comply with these requirements in a timely or cost-effective manner.
Such disruptions could materially and adversely affect our results of operations, cash flows and financial position. 44 Global incidents, such as world health events, could have a similar effect of disrupting our or our customers’ businesses to the extent they reach and impact the service areas on or around our land, the availability of supplies our customers need, the customers we or our customers serve, or the employees or other personnel who operate our or our customers’ businesses.
Global incidents, such as world health events, could have a similar effect of disrupting our or our customers’ businesses to the extent they reach and impact the service areas on or around our land, the availability of supplies our customers need, the customers we or our customers serve, or the employees or other personnel who operate our or our customers’ businesses.
To the extent that we need funds and OpCo or its subsidiaries are restricted from making distributions under applicable law or under the terms of any current or future financing or other arrangements or are otherwise unable to provide such funds, our results of operations, cash flows and financial position could be materially and adversely affected. 64 In certain circumstances, OpCo will be required to make tax distributions to OpCo Unitholders, and such tax distribution may be substantial.
To the extent that we need funds and OpCo or its subsidiaries are restricted from making distributions under applicable law or under the terms of any current or future financing or other arrangements or are otherwise unable to provide such funds, our results of operations, cash flows and financial position could be materially and adversely affected.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs a part of our cybersecurity risk management program, we review the various different Company policies that cover cybersecurity on an annual basis and have implemented procedures for responding to cybersecurity incidents. We provide training and awareness programs for all employees of Manager that includes periodic and ongoing assessments to drive adoption and awareness of cybersecurity processes and controls.
Biggest changeAs a part of our cybersecurity risk management program, we review the various different Company policies that cover cybersecurity on an annual basis and have implemented procedures for responding to cybersecurity incidents.
For additional information on cybersecurity risks we face, see “ Risk Factors—Risks Related to Our Business and Operations —Cyber incidents or attacks targeting systems and infrastructure used by the oil and natural gas industry may adversely impact our operations, and a cyber incident or systems failure could result in information theft, data corruption and operational disruption and our results of operations, cash flows or financial position may be adversely impacted.”
For additional information on cybersecurity risks we face, see “ Risk Factors—Risks Related to Our Business and Operations —Cyber incidents or attacks targeting systems and infrastructure used by the oil and natural gas industry may adversely impact our operations, and a cyber incident or systems failure could result in information theft, data corruption and operational disruption and our results of operations, cash flows or financial position may be adversely impacted.” 57
Our board of directors has delegated primary responsibility for overseeing our enterprise risk management process, including oversight of information technology, cybersecurity, and data privacy risks, to the Audit Committee. Despite this delegation of primary responsibility, both the Audit Committee and the board of directors are actively involved in risk oversight.
Our board of directors has delegated primary responsibility for overseeing our enterprise risk management process, including oversight of information technology, cybersecurity, and data privacy risks, to the Audit Committee. Despite this delegation of primary 56 responsibility, both the Audit Committee and the board of directors are actively involved in risk oversight.
Depending on the nature and severity of the cybersecurity incident, this process provides for notifying and escalating the incident to our board of directors . Risk Management and Strategy Our business operations rely on the secure collection, storage, transmission and other processing of proprietary, confidential or sensitive data.
Depending on the nature and severity of the cybersecurity incident, this process provides for notifying and escalating the incident to our board of directors . Risk Management and Strategy Our business operations rely on the secure collection, storage, transmission and other processing of proprietary, confidential and sensitive data.
We have implemented network monitoring, containment and incident response tools, vulnerability management processes and penetration testing. We also actively engage with key vendors and third-party advisors and consultants that assist us with identifying, assessing and managing cybersecurity risks to our business and employ processes to detect and monitor unusual network activity.
We also actively engage with key vendors and third-party advisors and consultants that assist us with identifying, assessing and managing cybersecurity risks to our business and employ processes to detect and monitor unusual network activity.
Due to evolving cybersecurity threats, it has and will continue to be difficult to prevent, detect, mitigate, and remediate cybersecurity incidents. 66 As detailed elsewhere in this Annual Report, we rely on information technology to manage our business and support our operations, including our secure processing of proprietary and other types of information.
As detailed elsewhere in this Annual Report, we rely on information technology to manage our business and support our operations, including our secure processing of proprietary and other types of information.
At the same time, cybersecurity incidents, including deliberate attacks or unintentional events, have increased.
At the same time, cybersecurity incidents, including deliberate attacks or unintentional events, have increased. Due to evolving cybersecurity threats, it has and will continue to be difficult to prevent, detect, mitigate, and remediate cybersecurity incidents.
Added
We provide training and awareness programs for all employees of Manager who provide services to us that include periodic and ongoing assessments to drive adoption and awareness of cybersecurity processes and controls. We have implemented network monitoring, containment and incident response tools, vulnerability management processes and penetration testing.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties As of December 31, 2024, we owned approximately 273,000 surface acres in and around the Delaware Basin sub-region of the Permian Basin in Texas and New Mexico. Substantially all of our land is encumbered by mortgages that secure our credit facility.
Biggest changeItem 2. Properties As of December 31, 2025, we owned or managed more than 315,000 surface acres in and around the Delaware Basin sub-region of the Permian Basin in Texas and New Mexico. Substantially all of our land is encumbered by mortgages that secure the 2025 Revolving Credit Facility.
In addition, pursuant to our SURAs and SUAs, we grant our customers rights to use our land in return for pre-determined fees and royalties. Other than such mortgages and our SURAs and SUA easements, there are no material liens or encumbrances on our title to our surface estate as of December 31, 2024.
In addition, pursuant to our SURAs and SUAs, we grant our customers rights to use our land in return for pre-determined fees and royalties. Other than such mortgages and our SURAs and SUAs, there are no material liens or encumbrances on our title to our surface estate as of December 31, 2025.
Removed
As of December 31, 2024, we also owned 4,424 gross mineral acres in Texas with a weighted average lease royalty percentage of 23.9% and net revenue interest per well of 4.3%. Of our gross mineral acres, approximately 96% underlie our surface acreage. Other than our gross mineral acres, we do not own the mineral interests that underlie our surface acreage.
Added
The following table shows by county our surface acreage owned and attributable to long-term leasehold or management agreements as of December 31, 2025: Number of Location (by county and position) Surface Acres (1)(2) Northern Position Andrews County (TX) 20,000 Lea County (NM) 40,000 Eddy County (NM) 1,000 Total 61,000 Stateline Position Loving County (TX) 98,000 Winkler County (TX) 36,000 Lea County (NM) 16,000 Reeves County (TX) 19,000 Total 169,000 Southern Position Reeves County (TX) 72,000 Pecos County (TX) 9,000 Ward County (TX) 6,000 Total 87,000 Total Acres 317,000 (1) The figures in this table are rounded to the nearest thousand acres.
Removed
The following table shows by county our surface ownership and royalty ownership as of December 31, 2024: Number of Acres Location (by county and position) Surface Gross Mineral Acres Northern Position Andrews County (TX) 20,479 - Lea County (NM) 35,041 - Eddy County (NM) 765 - Total 56,285 - Stateline Position Loving County (TX) 82,981 714 Winkler County (TX) 34,480 166 Lea County (NM) 15,669 - Reeves County (TX) 3,663 686 Total 136,793 1,566 Southern Position Reeves County (TX) 71,572 2,858 Pecos County (TX) 9,074 - Total 80,646 2,858 Total Acres 273,724 4,424
Added
(2) Inclusive of approximately 14,000 long-term leasehold or managed acres.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn the opinion of our management, there are no pending litigation, disputes or claims against us 67 which, if decided adversely, will have a material adverse effect on our financial condition, cash flows or results of operations. See Part II, Item 8. Financial Statements and Supplementary Data - Note 13. Commitments and Contingencies. Item 4.
Biggest changeIn the opinion of our management, there are no pending litigation, disputes or claims against us which, if decided adversely, will have a material adverse effect on our financial condition, cash flows or results of operations. See Part II, Item 8. Financial Statements and Supplementary Data — Note 13. Commitments and Contingencies. Item 4.
Mine Safety Disclosures Not applicable. 68 PART II
Mine Safety Disclosures Not applicable. 58 PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 68 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 69 Item 6. [Reserved] 70 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 71 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 88 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 58 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 59 Item 6. [Reserved] 60 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 61 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 76 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe IPO Concurrent Private Placement closed concurrently with the IPO on July 1, 2024. Goldman Sachs & Co. LLC, acted as the placement agent for the IPO Concurrent Private Placement. The securities issued in connection with the IPO Concurrent Private Placement were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
Biggest changeThe fair value of the OpCo Units was determined based on the closing price of the Company’s Class A shares on the date of acquisition. The securities issued in connection with the 1918 Ranch Acquisition were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
Our Class B shares are not listed on any exchange, and there is no established public trading market for such Class B shares. Dividends On November 5, 2024, our board of directors declared a dividend on our Class A shares of $0.10 per share, which was paid on December 19, 2024, to shareholders of record as of December 5, 2024.
Our Class B shares are not listed on any exchange, and there is no established public trading market for such Class B shares. Dividends On February 24, 2026, our board of directors declared a dividend on our Class A shares of $0.12 per share, payable on March 19, 2026 to shareholders of record as of March 5, 2026.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our Class A shares are listed on the NYSE under the symbol “LB.” As of March 5, 2025, 23,255,419 Class A shares were outstanding, with 13 holders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Class A shares are listed on the NYSE and NYSE Texas under the symbol “LB.” As of February 23, 2026, 27,838,199 Class A shares were outstanding, with two holders of record.
This number does not include shareholders whose shares are held in trust by other entities and the actual number of our shareholders is greater than the number of holders of record. As of March 5, 2025, 53,193,178 Class B shares were outstanding, with one holder of record.
This number does not include shareholders whose shares are held in trust by other entities and the actual number of our shareholders is greater than the number of holders of record. As of February 23, 2026, 49,250,916 Class B shares were outstanding, with six holders of record.
Furthermore, we are not contractually obligated to pay any dividends and do not have any required minimum dividend amount, and our credit facility limits our ability to pay dividends. If our board of directors determines to pay dividends in the future, the amount of such dividends may vary from quarter to quarter and may be significantly reduced or eliminated entirely.
If our board of directors determines to pay dividends in the future, the amount of such dividends may vary from quarter to quarter and may be significantly reduced or eliminated entirely.
Removed
On February 21, 2025, our board of directors declared a dividend on our Class A shares of $0.10 per share, payable on March 20, 2025 to shareholders of record as of March 6, 2025.
Added
Furthermore, we are not contractually obligated to pay any dividends and do not have any required minimum dividend amount, and the Notes and 2025 Revolving Credit Facility may limit our ability to pay dividends.
Removed
Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table summarizes repurchases of our Class A shares occurring in the fourth quarter of 2024.
Added
Performance Graph The performance graph below compares the cumulative return to holders of our Class A shares, the Standard & Poor’s 500 Index (“S&P 500”) and the reference group defined below (the “Reference Group”) during the period beginning on June 28, 2024 and ending on December 31, 2025.
Removed
Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs 10/1/2024 - 10/31/2024 - $ - - $ - 11/1/2024 - 11/30/2024 - - - 12/1/2024 - 12/31/2024 - - - Total - $ - - $ - Securities Authorized for Issuance under Equity Compensation Plans See Item 12.
Added
The performance graph was prepared based on the following assumptions: (i) $100 was invested in our Class A shares and in each of the S&P 500 and Reference Group at the beginning of the period and (ii) the dividends were reinvested on the relevant payment dates.
Removed
Recent Sales of Unregistered Equity Securities IPO Concurrent Private Placement On June 27, 2024, we entered into a Common Share Purchase Agreement with an accredited investor (the “Accredited Investor”), pursuant to which the Accredited Investor purchased 750,000 Class A shares from us at $17.00 per share in a private placement that closed concurrently with the IPO (the “IPO Concurrent Private Placement”), resulting in net proceeds of approximately $12.5 million 69 after deducting fees to the placement agent and other expenses payable by the Company in connection with the IPO Concurrent Private Placement.
Added
The results reflected in the graph below are historical and are not necessarily indicative of future performance. 59 June 30, 2024 December 31, 2024 June 30, 2025 December 31, 2025 S&P 500 Index $ 100.00 $ 107.30 $ 113.20 $ 124.90 LandBridge $ 100.00 $ 380.60 $ 399.30 $ 291.10 Reference Group (1) $ 100.00 $ 103.10 $ 114.00 $ 128.10 (1) Comparable companies include the following: Farmland Partners Inc., First Industrial Realty Trust, Inc., Franco-Nevada Corporation, Gladstone Land Corporation, OR Royalties Inc., PotlatchDeltic Corporation, Prologis, Inc., Rayonier Inc., Rexford Industrial Realty, Inc, Royal Gold, Inc., Tejon Ranch Co., TPL, The St.
Removed
We contributed the net proceeds from the IPO Concurrent Private Placement to OpCo in exchange for additional OpCo Units and OpCo used such net proceeds, together with net proceeds from the IPO and the exercise of the underwriters’ over-allotment option, to repay outstanding indebtedness and make a distribution to existing unitholders.
Added
Joe Company, Weyerhaeuser Company, Wheaton Precious Metals Corp. Purchases of Equity Securities by the Issuer and Affiliated Purchasers There was no share repurchase activity during the three months ended December 31, 2025. Securities Authorized for Issuance under Equity Compensation Plans See Part III, Item 12.
Removed
The Accredited Investor is an accredited investor for purposes of Rule 501 of Regulation D. December Private Placement In December 2024, we closed the private placement pursuant to which certain persons reasonably believed to be accredited investors or qualified institutional buyers purchased an aggregate 5,830,419 Class A shares from us at $60.03 per share (the “December Private Placement”).
Added
Recent Sales of Unregistered Equity Securities 1918 Ranch Acquisition On November 12, 2025, to fund a portion of the purchase consideration for the 1918 Ranch Acquisition, OpCo issued 657,411 OpCo Units and the Company issued an equal number of Class B shares valued at $53.6 million.
Removed
We used approximately $200.0 million of the proceeds from the December Private Placement, net of placement fees, to partially fund the Wolf Bone Acquisition, and approximately $150.0 million of such proceeds, net of placement fees, to purchase 2,498,751 OpCo Units (along with the cancellation of a corresponding number of Class B shares) from LandBridge Holdings.
Removed
Other than as previously reported on our Current Reports on Form 8-K, filed with the SEC on July 3, 2024, and November 22, 2024, we had no sales of unregistered securities during the year ended December 31, 2024.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFollowing consummation of the IPO, although we are a limited liability company, we have elected to be taxed as a corporation and are subject to U.S. federal, state and local income taxes on our allocable share of the income and loss of OpCo. 79 Results of Operations Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Year Ended December 31, 2024 2023 (In thousands) Revenues: Surface use royalties $ 31,620 $ 13,216 Easements and other surface-related revenues 34,115 12,644 Resource sales 15,351 19,830 Oil and gas royalties 16,027 20,743 Resource royalties 12,841 6,432 Total revenues 109,954 72,865 Resource sales-related expense 2,113 3,445 Other operating and maintenance expense 3,174 2,740 General and administrative expense (income) 112,302 (12,091 ) Depreciation, depletion, amortization and accretion 8,875 8,762 Operating (loss) income (16,510 ) 70,009 Interest expense, net 23,335 7,016 Other income (241 ) (549 ) (Loss) income from operations before taxes (39,604 ) 63,542 Income tax expense 1,875 370 Net (loss) income $ (41,479 ) $ 63,172 Total revenues .
Biggest changeResults of Operations Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 Year Ended December 31, Variance 2025 2024 Amount Percent Revenues: Surface use royalties $ 72,772 $ 31,620 $ 41,152 130 % Easements and other surface-related revenues 62,002 34,115 27,887 82 % Resource sales 24,723 15,351 9,372 61 % Resource royalties 23,027 12,841 10,186 79 % Oil and gas royalties 12,589 16,027 (3,438 ) (21 %) Other 3,980 - 3,980 100 % Total revenues 199,093 109,954 89,139 81 % Resource sales-related expense 2,026 2,113 (87 ) (4 %) Other operating and maintenance expense 4,518 3,174 1,344 42 % General and administrative expense 62,448 112,302 (49,854 ) (44 %) Depreciation, depletion and amortization 11,470 8,875 2,595 29 % Other operating expense, net 131 - 131 100 % Operating income (loss) 118,500 (16,510 ) 135,010 818 % Interest expense, net 32,706 23,335 9,371 40 % Other income (loss) 4,329 (241 ) 4,570 1896 % Income (loss) from operations before taxes 81,465 (39,604 ) 121,069 306 % Income tax expense 9,066 1,875 7,191 384 % Net income (loss) $ 72,399 $ (41,479 ) $ 113,878 275 % Total revenues .
Any individual who is our officer or employee or an officer or employee of any of our affiliates, and any other person who provides services to us or our affiliates, including our directors, may be eligible to receive awards under the LTIP at the discretion of our Board or a committee thereof, as applicable.
Any individual who is our officer or employee or an officer or employee of any of our affiliates, and any other person who provides services to us or our affiliates, including our directors, may be eligible to receive awards under the LTIP at the discretion of our board of directors or a committee thereof, as applicable.
The LTIP provides for the grant, from time to time, at the discretion of our Board, or a committee thereof, of options, share appreciation rights, restricted shares, restricted share units, share awards, dividend equivalents, other share-based awards, cash awards, substitute awards and performance awards intended to align the interests of employees, directors and service providers with those of our shareholders.
The LTIP provides for the grant, from time to time, at the discretion of our board of directors, or a committee thereof, of options, share appreciation rights, restricted shares, restricted share units, share awards, dividend equivalents, other share-based awards, cash awards, substitute awards and performance awards intended to align the interests of employees, directors and service providers with those of our shareholders.
For the year ended December 31, 2024, cash provided by financing activities consisted of $609.4 million of net proceeds from the IPO and December Private Placement and $250.7 million of debt borrowings, net of repayments and debt issuance costs, primarily used to fund the acquisitions during the year, partially offset by the purchase of OpCo Units from LandBridge Holdings of $145.4 million, dividends and distributions paid, net of contributions, of $58.2 million.
For the year ended December 31, 2024, cash provided by financing activities consisted of $609.4 million of net proceeds from the IPO and December 2024 private placement and $250.2 million of debt borrowings, net of repayments and debt issuance costs, primarily used to fund acquisitions during the year, partially offset by the purchase of OpCo Units from LandBridge Holdings of $145.4 million and $58.2 million of dividends and distributions paid, net of contributions.
We typically receive a fee when the contract is executed and a fixed royalty per barrel of water or ton of sand extracted. In situations where our customers do not operate brackish water wells on our surface but require the use of water for their operations, they generally must acquire such water from us for our customary fee.
We typically receive a fee when the contract is executed and a fixed royalty per barrel of water or ton of sand extracted. In situations where our customers do not operate brackish water wells on our surface but require the use of water for their operations, customers generally must acquire such water from us for our customary fee.
Although we believe that we will be able to partially or fully fund our short-term and long-term capital expenditures, working capital requirements and other capital needs with cash on hand and cash flows from operating activities, we may elect to use borrowings under our credit facility to finance our operating and investing activities.
Although we believe that we will be able to partially or fully fund our short-term and long-term capital expenditures, working capital requirements and other capital needs with cash on hand and cash flows from operating activities, we may elect to use borrowings under our revolving credit facility to finance our operating and investing activities.
We measure our revenue divided by our total acreage as a performance metric, which we refer to as “surface use economic efficiency.” Further, we are actively pursuing additional revenue streams beyond the hydrocarbon value chain to maximize utilization of our land and resources.
We measure our revenue divided by our acreage as a performance metric, which we refer to as “surface use economic efficiency.” Further, we are actively pursuing additional revenue streams beyond the hydrocarbon value chain to maximize utilization of our land and resources.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations is based on, and should be read in conjunction with, our Financial Statements and notes thereto in Part 8, “Financial Statements and Supplementary Data” of this Annual Report.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations is based on, and should be read in conjunction with, our Financial Statements and notes thereto in Item 8, “Financial Statements and Supplementary Data” of this Annual Report.
Over time, these revenues would generally be expected to migrate to royalty revenue and resource sales based on such customer’s use of our land and resources. Our revenue consists of the principal components discussed below. Surface Use Royalties and Revenues Surface Use Royalties .
Over time, 63 these revenues would generally be expected to migrate to royalty revenue and resource sales based on such customer’s use of our land and resources. Our revenue consists of the principal components discussed below. Surface Use Royalties and Revenues Surface Use Royalties .
We define Adjusted EBITDA as net income (loss) before interest; taxes; depreciation, amortization, depletion and accretion; share-based compensation; non-recurring transaction-related expenses and other non-cash or non-recurring expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues.
We define Adjusted EBITDA as net income (loss) before interest; taxes; depreciation, depletion and amortization; share-based compensation; non-recurring transaction-related expenses and other non-cash or non-recurring expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues.
Further, we believe this metric serves as a worthwhile benchmark of our team’s management and growth strategy, as well as the relative value of our surface acreage, compared to our peers. 77 Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are used by our management and by external users of our financial statements, such as investors, research analysts and others, to assess the financial performance of our assets over the long term to generate sufficient cash to return capital to equity holders or service indebtedness.
Further, we believe this metric serves as a worthwhile benchmark of our team’s management and growth strategy, as well as the relative value of our surface acreage, compared to our peers. 66 Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are used by our management and by external users of our financial statements, such as investors, research analysts and others, to assess the financial performance of our assets over the long term to generate sufficient cash to return capital to equity holders or service indebtedness.
See Note 2 — Summary of Significant Accounting Policies and Note 10 — Share-Based Compensation to our consolidated financial statements for additional information regarding LBH Incentive Units. How We Generate Revenue We generate revenue from multiple sources, including the use of our surface acreage, the sale of resources from our land and oil and gas and mineral royalties.
Refer to Note 2 — Summary of Significant Accounting Policies and Note 10 — Share-Based Compensation to our consolidated financial statements for additional information regarding LBH Incentive Units. How We Generate Revenue We generate revenue from multiple sources, including the use of our surface acreage, the sale of resources from our land and oil and gas and mineral royalties.
Factors that could cause or contribute to such differences include, but are not limited to, market prices for oil and natural gas, production volumes, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this Annual Report, particularly in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements,” and in the prospectus under the heading “Risk Factors,” all of which are difficult to predict.
Factors that could cause or contribute to such differences include, but are not limited to, market prices for oil and natural gas, production volumes, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this Annual Report, particularly in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements,” all of which are difficult to predict.
We define Free Cash Flow as cash flow from operating activities less investment in capital expenditures. We define Free Cash Flow Margin as Free Cash Flow divided by total revenues.
We define 70 Free Cash Flow as cash flow from operating activities less investment in capital expenditures. We define Free Cash Flow Margin as Free Cash Flow divided by total revenues.
Our agreements related to the sale of resources generally have terms ranging from a minimum of five years to 10 years, with early termination rights for non-use over a pre-determined period of time, typically 12 to 18 months.
Our agreements related to the sale of resources generally have terms ranging from a minimum of five years to 10 years, with early termination rights for non-use over a pre-determined period of time, typically 12 to 18 months. Resource Royalties .
See Note 10 — Share-Based Compensation to our consolidated financial statements for additional information regarding share-based compensation. How We Evaluate Our Operations We use a variety of financial and operational metrics to assess the performance of our business. Revenue Revenue is a key performance metric of our company.
Refer to Note 10 — Share-Based Compensation to our consolidated financial statements for additional information regarding share-based compensation. How We Evaluate Our Operations We use a variety of financial and operational metrics to assess the performance of our business. Revenue Revenue is a key performance metric of our company.
Public Company Costs As a result of the IPO, we incurred incremental, non-recurring costs related to our transition to a publicly traded and taxable entity, including the costs of the IPO and the costs associated with the initial implementation of our Sarbanes-Oxley Act internal controls and testing.
Public Company Costs As a result of the IPO during 2024, we incurred incremental, non-recurring costs related to our transition to a publicly traded and taxable entity, including the costs of the IPO and the costs associated with the initial implementation of our Sarbanes-Oxley Act internal controls and testing.
Please read “—Non-GAAP Financial Measures” for reconciliations and additional information regarding these non-GAAP financial measures.
Please read “— Non-GAAP Financial Measures ” for reconciliations and additional information regarding these non-GAAP financial measures.
The applicable margin ranges from (i) prior to the consummation of the IPO, 3.00% to 4.00% in the case of Term SOFR loans and letter of credit fees, and 2.00% to 3.00% in the case of base rate loans, and commitments fees of 0.50%, and (ii) following consummation of the IPO, 2.75% to 3.75% in the case of Term SOFR loans and letter of credit fees, and 1.75% to 2.75% in the case of base rate loans, and commitment fees range from 0.375% to 0.50%.
The applicable margin ranged from (i) prior to the consummation of the IPO, 3.00% to 4.00% in the case of Term SOFR loans and letter of credit fees, and 2.00% to 3.00% in the case of base rate loans, and commitments fees of 0.50%, and (ii) following consummation of the IPO, 2.75% to 3.75% in the case of Term SOFR loans and letter of credit fees, and 1.75% to 2.75% in the case of base rate loans, and commitment fees ranged from 0.375% to 0.50%.
Direct corporate costs are incurred for direct corporate employees, including payroll, benefits and other employee-related expenses of our direct corporate staff, professional services that generally consist of audit, tax, legal and valuation services and expenses for corporate insurance policies. Prior to the IPO, share-based compensation expense only included expense allocated to us for NDB LLC’s Incentive Unit plan.
Direct corporate costs are incurred for dedicated corporate employees, including payroll, benefits and other employment-related expenses, professional services that generally consist of audit, tax, legal and valuation services and expenses for corporate insurance policies. Prior to the IPO, share-based compensation expense only included expense allocated to us for NDB LLC’s Incentive Unit plan.
WaterBridge is one of the largest water midstream companies in the United States and operates a large-scale network of pipelines and other infrastructure in the Delaware Basin that, as of December 31, 2024, handles approximately 2.0 million bpd of water associated with oil and natural gas production, with approximately 3.4 million bpd of total handling capacity.
WaterBridge is one of the largest water midstream companies in the United States and operates a large-scale network of pipelines and other infrastructure in the Delaware Basin that, as of December 31, 2025, handles approximately 2.5 million bpd of water associated with oil and natural gas production, with approximately 4.2 million bpd of total handling capacity.
Our primary liquidity and capital requirements will be for our operating expenses, servicing of our debt, the payment of dividends to our shareholders, general company needs and investing in our business, including the potential acquisition of additional surface acreage, such as the Recent Acquisitions.
Our primary liquidity and capital requirements will be for our operating expenses, servicing of our debt, the payment of dividends to our shareholders, general company needs and investing in our business, including the potential acquisition of additional surface acreage.
We have also experienced additional significant growth in our business following the completion of the Spring 2024 Acquisitions and the Recent Acquisitions, resulting in our future results of operations for periods following the consummation of such acquisitions to not be directly comparable with our historical results.
We have also experienced additional significant growth in our business following the completion of our acquisitions, resulting in our future results of operations for periods following the consummation of such acquisitions to not be directly comparable with our historical results.
We may elect for outstanding borrowings under our credit facility to accrue interest at a rate based on either (i) a forward-looking term rate based on the secured overnight financing rate (“Term SOFR”) plus 0.10%, or (ii) the base rate, in each case plus an applicable margin.
Under the 2023 Credit Agreement, the Borrower could elect for outstanding borrowings under our credit facility to accrue interest at a rate based on either (i) a forward-looking term rate based on the secured overnight financing rate (“Term SOFR”) plus 0.10%, or (ii) the base rate, in each case plus an applicable margin.
For example, oil and natural gas prices have historically been volatile. Lower commodity prices may decrease our revenues as customers on and around our land decrease their activity levels in response to low commodity prices.
For example, oil and natural gas prices have historically been volatile and highly susceptible to macroeconomic and geopolitical developments. Lower commodity prices may decrease our revenues as customers on and around our land decrease their activity levels in response to low commodity prices.
As a result, we expect that additional significant capital expenditures would be related to our acquisition of additional surface acreage, such as the Recent Acquisitions, should we elect to do so.
As a result, we expect that additional significant capital expenditures would be related to our acquisition of additional surface acreage, should we elect to do so.
The historical financial information in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” reflects only the historical financial results of us or our predecessor, OpCo, as applicable, and does not give pro forma effect to the East Stateline Acquisition, the Credit Agreement Amendment, the Corporate Reorganization or the IPO.
The historical financial information in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” reflects only the historical financial results of us or our predecessor, OpCo, as applicable, and does not give pro forma effect to the Corporate Reorganization or the IPO.
Critical Accounting Estimates The preparation of our Consolidated Financial Statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements. We consider our critical accounting estimates those that require subjectivity and that could inherently influence our financial result based on changes in those estimates.
GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements. We consider our critical accounting estimates those that require subjectivity and that could inherently influence our financial result based on changes in those estimates.
SUAs permit operators to install drilling sites, pipelines, roadways, electric lines and other facilities and equipment on land owned by us.
Easements and other surface-related income . SUAs permit operators to install drilling sites, pipelines, roadways, electric lines and other facilities and equipment on land owned by us.
Although we intend to pursue additional opportunities to increase our revenue streams and introduce additional revenue components, including through solar power generation, power storage and battery projects, water treatment and desalination facilities, fueling stations, microgrids, cryptocurrency mining, data centers, telecommunication towers and equipment and other opportunities, there can be no assurance that such revenue streams will materially diversify our revenue streams. 76 Costs of Conducting our Business Our costs consist primarily of resource sales-related expenses, other operating and maintenance expenses to maintain our surface acreage and general administrative expenses.
Although we intend to pursue additional opportunities to increase our revenue streams and introduce additional revenue components, including through conventional and renewable power generation and storage projects, water treatment and desalination facilities, fueling stations, digital infrastructure, telecommunication towers and equipment and other opportunities, there can be no assurance that such revenue streams will materially diversify our revenue streams. 65 Costs of Conducting our Business Our costs consist primarily of resource sales-related expenses, other operating and maintenance expenses to maintain our surface acreage and general administrative expenses.
Similar to the other operations conducted on our land, we expect to enter into surface use or similar agreements with the owners of these projects from which we expect to receive surface use fees and other payments in connection with the utilization of our land, but we do not expect to own or operate such projects or expect to incur significant capital expenditures in connection therewith. 71 We share a financial sponsor, Five Point, and our management team with WaterBridge.
Similar to the other operations conducted on our land, we expect to enter into surface use or similar agreements with the owners of these projects from which we expect to receive surface use fees and other payments in connection with the utilization of our land, but we do not expect to own or operate such projects or expect to incur significant capital expenditures in connection therewith.
As of December 31, 2024, we owned approximately 273,000 surface acres in and around the Delaware Basin sub-region in the prolific Permian Basin, which is the most active area for oil and gas exploration and development in the United States.
As of December 31, 2025, we owned or managed more than 315,000 surface acres in and around the Delaware Basin sub-region in the prolific Permian Basin, which is the most active area for oil and gas exploration and development in the United States.
For the year ended December 31, 2024, we incurred $723.4 million in acquisition-related capital expenditures, inclusive of $3.1 million of transaction-related expenses, in connection with the consummation of the Spring 2024 Acquisitions and the Recent Acquisitions. We periodically assess changes in current and projected cash flows, acquisition and divestiture activities and other factors to determine the effects on our liquidity.
For the years ended December 31, 2025 and 2024, we incurred $229.0 million and $723.4 million in acquisition-related capital expenditures, inclusive of $2.3 million and $3.1 million of transaction-related expenses, respectively. We periodically assess changes in current and projected cash flows, acquisition and divestiture activities and other factors to determine the effects on our liquidity.
Borrowings under our credit facility accrue interest based on a five-tiered pricing grid tied to our current leverage ratio.
Borrowings under the 2023 Credit Agreement accrued interest based on a five-tiered pricing grid tied to our current leverage ratio.
The estimated fair value of our credit facility approximates the principal amount outstanding because the interest rates are variable and reflective of market rates and the debt may be repaid, in full or in part, at any time without penalty.
The estimated fair value of our credit facility approximates the principal amount outstanding because the interest rates are variable and reflective of market rates and the debt may be repaid, in full or in part, at any time without penalty. As of December 31, 2025, we had $70.0 million of borrowings under the 2025 Revolving Credit Facility.
The weighted average interest rate on the total amount of borrowings outstanding under new credit facility for the twelve months ended December 31, 2024 was 8.39% in the case of revolving credit borrowings and 8.47% in the case of term loan borrowings. We are currently in compliance with all affirmative and negative covenants under our new credit facility.
The weighted average interest rate on the total amount of borrowings outstanding under 2025 Revolving Credit Facility for the twelve months ended December 31, 2025 was 6.13%. We are currently in compliance with all affirmative and negative covenants under the 2025 Revolving Credit Facility.
As of December 31, 2024, WaterBridge operates approximately 767,000 bpd of water handling capacity on our land, with approximately 1.7 million bpd of additional permitted capacity available for future development on our land.
As of December 31, 2025, WaterBridge operates approximately 1.5 million bpd of water handling capacity on our land, with approximately 3.2 million bpd of additional permitted 61 capacity available for future development on our land.
As of December 31, 2024, we had working capital, defined as current assets less current liabilities, of $38.9 million and we had cash and cash equivalents of $37.0 million. As of December 31, 2023, we had working capital of $25.2 million and cash and cash equivalents of $37.8 million.
As of December 31, 2025, we had working capital, defined as current assets less current liabilities, of $47.5 million and we had cash and cash equivalents of $30.7 million. As of December 31, 2024, we had working capital of $38.9 million and cash and cash equivalents of $37.0 million.
The increase was primarily attributable to increased produced water handling and associated skim oil royalties of $17.3 million and industrial waste handling royalties of $1.1 million on our surface for the year ended December 31, 2024, as compared to the year ended December 31, 2023. Easements and other surface-related revenues .
The increase was primarily attributable to increased produced water handling and associated skim oil royalties of $40.1 million and solid waste disposal and reclamation royalties of $1.1 million on our surface for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Any transition of the U.S. economy away from the use of fossil fuels towards lower- or zero-carbon emissions alternatives, like clean energy technologies, often require access to material surface acreage and supporting infrastructure, which we are also well positioned to facilitate. Please see the “ Business ” of this Annual Report for more information.
While these incentives could further accelerate the transition of the U.S. economy away from the use of fossil fuels, alternative energy technologies often require access to material surface acreage and supporting infrastructure, which we are also well positioned to provide and facilitate. Please see the “ Business ” of this Annual Report for more information.
Unless otherwise indicated or required by the context, references to “LandBridge,” the “Company,” “we,” “us,” “our” and like terms refer (i) prior to the consummation of the Corporate Reorganization and the IPO, to OpCo and its subsidiaries, our predecessor for financial reporting purposes, and (ii) subsequent to the consummation of the Corporate Reorganization and the IPO, to LandBridge and its subsidiaries, including OpCo and its subsidiaries.
Except as otherwise indicated or required by context, references to “LandBridge,” the “Company,” “we,” “us,” “our” and like terms refer (i) prior to the consummation of the reorganizations of entities under common control (the “Corporate Reorganization”) and the initial public offering that occurred on July 1, 2024 (the “IPO”), to OpCo and its subsidiaries, our predecessor for financial reporting purposes and (ii) subsequent to the consummation of the Corporate Reorganization and the IPO, to LandBridge and its subsidiaries, including OpCo and its subsidiaries.
As a result, the historical consolidated financial data may not give you an accurate indication of what our actual results would have been if the Corporate Reorganization had been completed at the beginning of the periods presented or of what our future results of operations are likely to be. 78 Long-Term Incentive Plan In order to incentivize individuals providing services to us or our affiliates, our Board adopted a long-term incentive plan (“LTIP”) for employees and directors.
As a result, the historical consolidated financial data may not give you an accurate indication of what our actual results would have been if the Corporate Reorganization had been completed at the beginning of the periods presented or of what our future results of operations are likely to be.
Resource sales generally include brackish water to be used primarily in well completions in exchange for a per barrel fee, which is negotiated and varies depending on the destination of the brackish water. We have strong relationships with, and contractual commitments from, many of the E&P companies in the Stateline Position.
Resource Sales and Royalties Resource Sales . Resource sales generally include brackish water to be used primarily in well completions in exchange for a per barrel fee, which is negotiated and varies depending on the destination of the brackish water.
Liquidity and Capital Resources Overview Historically, our primary sources of liquidity have been capital contributions from our financial sponsor, cash flows from operating activities and borrowings under our debt instruments. Following the completion of the IPO, our primary sources of liquidity are cash flows from operating activities and, if required, proceeds from borrowings under our credit facility.
Following the completion of the IPO, our primary sources of liquidity are cash flows from operating activities and, if required, proceeds from borrowings under our revolving credit facility.
The following table presents the amount and relative percentage of each component of our revenues for the following periods: Year Ended December 31, 2024 2023 Amount ($) % Amount ($) % Surface use royalties and revenues Surface use royalties $ 31,620 28.8 % $ 13,216 18.1 % Easements and other surface-related revenues 34,115 31.0 % 12,644 17.4 % Resource sales and royalties Resource sales 15,351 14.0 % 19,830 27.2 % Resource royalties 12,841 11.7 % 6,432 8.8 % Oil and gas royalties 16,027 14.5 % 20,743 28.5 % Total revenue $ 109,954 100.0 % $ 72,865 100.0 % Our revenues may vary significantly from period to period as a result of the activity level of producers on and around our land, the development of new revenue streams, commodity prices, changes in volumes produced on our land and our acquisition strategy, among other things, and are significantly dependent on our customers’ activities on and around our land.
The following table presents the amount and relative percentage of each component of our revenues for the following periods: Year Ended December 31, 2025 2024 Amount ($) % Amount ($) % Surface use royalties and revenues Surface use royalties $ 72,772 36.6 % $ 31,620 28.8 % Easements and other surface-related revenues 62,002 31.1 % 34,115 31.0 % Resource sales and royalties Resource sales 24,723 12.4 % 15,351 14.0 % Resource royalties 23,027 11.6 % 12,841 11.7 % Oil and gas royalties 12,589 6.3 % 16,027 14.5 % Other 3,980 2.0 % - 0.0 % Total revenue $ 199,093 100.0 % $ 109,954 100.0 % Our revenues depend heavily on our customers’ activities on and around our land and may vary significantly from period to period as a result of the development of new revenue streams, fluctuations in commodity prices, regulatory developments, including policies related to tariffs and international trade, changes in volumes produced on our land and our acquisition strategy.
Corporate Reorganization We were formed to serve as the issuer in the IPO and had no operations, assets or liabilities prior to the consummation of the IPO. Certain of the historical consolidated financial statements included in this Annual Report are based on the financial statements of our accounting predecessor, OpCo, prior to the Corporate Reorganization in connection with the IPO.
Certain of the historical consolidated financial statements included in this Annual Report are based on the financial statements of our accounting predecessor, OpCo, prior to the Corporate Reorganization in connection with the IPO.
This metric provides valuable insight into the effectiveness of our active land management strategy by examining our ability to generate value on our owned surface and track trends of our results over time, while inherently adjusting for any surface acreage acquisitions or divestitures that may occur.
Surface Use Economic Efficiency We calculate surface use economic efficiency as (i) total revenues less oil and gas royalty revenues divided by (ii) owned surface acreage. or in periods in which we acquire or dispose of acreage, the weighted average surface acreage owned during the period.This metric provides valuable insight into the effectiveness of our active land management strategy by examining our ability to generate value on our owned surface and track trends of our results over time, while inherently adjusting for any surface acreage acquisitions or divestitures that may occur.
We receive lease bonus revenue by leasing our mineral interests to E&P companies. When we execute a mineral lease contract, the lease generally transfers the rights to any oil or natural gas discovered to the E&P company and grants us the right to a specified royalty interest payable on future production. Mineral lease bonuses are nonrefundable.
When we execute a mineral lease contract, the lease generally transfers the rights to any oil or natural gas discovered to the E&P company and grants us the right to a specified royalty interest payable on future production. 64 We expect our fee-based revenues to grow over time relative to our oil and gas royalties.
Year-end Results Significant financial and operating highlights for the year ended December 31, 2024 include: • Revenues of $110.0 million, an increase of $37.1 million as compared to the prior year; • Net loss of $41.5 million as compared to net income of $63.2 million in 2023; • Net loss margin of 38% as compared to net income margin of 87% in 2023; • Adjusted EBITDA (1) of $97.1 million, an increase of 55% as compared to the prior year; • Adjusted EBITDA Margin (1) of 88%, an increase of 2% as compared to the prior year; • Cash flow from operating activities of $67.6 million, an increase of 28% as compared to the prior year; • Free Cash Flow (1) of $66.7 million, an increase of 33% as compared to the prior year; • Operating cash flow margin of 62%, a decrease of 11% as compared to the prior year; and • Free Cash Flow Margin (1) of 61%, a decrease of 8% as compared to the prior year; (1) Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are non-GAAP financial measures.
Year-end Results Significant financial and operating highlights for the year ended December 31, 2025 include: • Revenues of $199.1 million, an increase of $89.1 million as compared to the prior year; • Net income of $72.4 million as compared to net loss of $41.5 million in 2024; • Net income margin of 36% as compared to net loss margin of 38% in 2024; • Adjusted EBITDA (1) of $177.2 million, an increase of 83% as compared to the prior year; • Adjusted EBITDA Margin (1) of 89%, remained consistent with the prior year; • Cash flow from operating activities of $126.3 million, an increase of 87% as compared to the prior year; • Free Cash Flow (1) of $122.0 million, an increase of 83% as compared to the prior year; • Operating cash flow margin of 63%,remained consistent with the prior year; and • Free Cash Flow Margin (1) of 61%, remained consistent with the prior year; (1) Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are non-GAAP financial measures.
Non-GAAP Financial Measures Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are supplemental non-GAAP measures that we use to evaluate current, past and expected future performance.
The increase was attributable to higher taxable income in 2025 due to a full year as a taxable entity. Non-GAAP Financial Measures Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are supplemental non-GAAP measures that we use to evaluate current, past and expected future performance.
Please read “—Non-GAAP Financial Measures” for reconciliations and additional information regarding these non-GAAP financial measures. Factors Affecting the Comparability of Our Results of Operations In this Annual Report, we present our historical results of operations for the years ended December 31, 2024 and December 31, 2023.
Factors Affecting the Comparability of Our Results of Operations In this Annual Report, we present our historical results of operations for the years ended December 31, 2025 and 2024.
(3) Non-recurring expenses consist primarily of $5.0 million in IPO-related employee bonuses and $2.6 million related to a contract termination payment. 82 Free Cash Flow and Free Cash Flow Margin The following table sets forth a reconciliation of cash flows from operating activities determined in accordance with GAAP to Free Cash Flow and Free Cash Flow Margin, respectively, for the periods indicated.
Free Cash Flow and Free Cash Flow Margin The following table sets forth a reconciliation of cash flows from operating activities determined in accordance with GAAP to Free Cash Flow and Free Cash Flow Margin, respectively, for the periods indicated.
Year Ended December 31, 2024 2023 Net (loss) income $ (41,479 ) $ 63,172 Adjustments: Depreciation, depletion, amortization and accretion 8,875 8,762 Interest expense, net 23,335 7,016 Income tax expense 1,875 370 EBITDA (7,394 ) 79,320 Adjustments: Share-based compensation - Incentive Units (1) 91,307 (17,230 ) Share-based compensation - RSUs 4,028 - Transaction-related expenses (2) 1,266 598 Non-recurring expenses (3) 7,825 - Other 37 116 Adjusted EBITDA $ 97,069 $ 62,804 Net (loss) income margin (38 %) 87 % Adjusted EBITDA Margin 88 % 86 % (1) Share-based compensation - Incentive Units for the year ended December 31, 2024, consists of $18.7 million related to the LBH Incentive Units, and $72.6 million related to the NDB Incentive Units.
Year Ended December 31, 2025 2024 Net income (loss) $ 72,399 $ (41,479 ) Adjustments: Depreciation, depletion and amortization 11,470 8,875 Interest expense, net 32,706 23,335 Income tax expense 9,066 1,875 EBITDA 125,641 (7,394 ) Adjustments: Share-based compensation - Incentive Units (1) 36,508 91,307 Share-based compensation - RSUs 8,811 4,028 Transaction-related expenses (2) 5,955 1,266 Non-recurring expenses (3) - 7,825 Other 256 37 Adjusted EBITDA $ 177,171 $ 97,069 Net income (loss) margin 36 % (38 %) Adjusted EBITDA Margin 89 % 88 % (1) Share-based compensation - Incentive Units for the year ended December 31, 2025, consists only of LBH Incentive Units.
We expect to pursue opportunistic future land acquisitions that compliment or expand our current land position, which may impact the comparability of our results.
Refer to Note 4 — Asset Acquisitions within the notes to our consolidated 67 financial statements for further information with respect to such acquisitions. We expect to pursue opportunistic future land acquisitions that compliment or expand our current land position, which may impact the comparability of our results.
Recently Issued Accounting Standards For a summary of recently issued accounting standards, see Note 2 — Summary of Significant Accounting Policies - Basis of Presentation and Consolidation of our Notes to the Consolidated Financial Statements.
Recently Issued Accounting Standards For a summary of recently issued accounting standards, refer to Note 2 — Summary of Significant Accounting Policies of our Notes to the Consolidated Financial Statements. Off Balance Sheet Arrangements We currently have no off-balance sheet arrangements.
Resource royalties increased by $6.4 million, or 100%, to $12.8 million for the year ended December 31, 2024, as compared to $6.4 million for the year ended December 31, 2023.
Resource sales increased by $9.4 million. Brackish water sales increased $6.3 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
As a result of our predominately non-taxable structure historically, income taxes on taxable income or losses realized by our predecessor, OpCo, were generally the obligation of the individual members or partners.
A REIT must comply with a number of organizational and operational requirements, including a requirement that it must pay at least 90% of its taxable income to shareholders. As a result of our predominately non-taxable structure historically, income taxes on taxable income or losses realized by our predecessor, OpCo, were generally the obligation of the individual members or partners.
Brackish water sales volume decreased by 4.9 million barrels, or 12%, to 34.2 million barrels for the year ended December 31, 2024, as compared to 39.1 million barrels for the year ended December 31, 2023. Additionally, the per unit sales price decreased by approximately 17%.
Brackish water sales volume increased by 10.4 million barrels, or 30%, to 44.6 million barrels for the year ended December 31, 2025, as compared to 34.2 million barrels for the year ended December 31, 2024. partially offset by a per unit sales price decreased of approximately 12%, primarily driven by the customer contract mix for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Such customers hold the exclusive right to the water and sand they extract from the leased surface acreage and may be required to make minimum royalty payments as a result. 75 The agreements pursuant to which we receive resource royalties have varying primary terms of at least one year, and contain rights for renewal so long as the customer continues to operate on our land.
The agreements pursuant to which we receive resource royalties have varying primary terms of at least one year, contain rights for renewal so long as the customer continues to operate on our land and generally do not impose minimum production requirements on our customers.
Our SUAs typically do not include minimum commitments with respect to the type and amount of infrastructure to be installed on our property or the amount of revenue to be received by us, but do generally provide for automatic renewal-based increases in royalties that are tied to the CPI or negotiated on a case-by-case basis, depending on a number of factors, such as general economic conditions, the surface use of our land, competitor pricing and/or customer specific considerations.
Our SUAs generally have terms ranging from a minimum of five years to 10 years, with early termination rights for non-use over a pre-determined period of time, typically 12 to 18 months, typically do not include minimum commitments with respect to the type and amount of infrastructure to be installed on our property or the amount of revenue to be received by us and generally provide for automatic renewal-based increases in royalties that are tied to the CPI or negotiated on a case-by-case basis.
There is no tax imposed on a REIT as long as the REIT complies with the applicable tax rules and avails itself of the opportunity to reduce its taxable income through distributions. A REIT must comply with a number of organizational and operational requirements, including a requirement that it must pay at least 90% of its taxable income to shareholders.
One of our subsidiaries is a qualified REIT for federal income tax purposes. There is no tax imposed on a REIT as long as the REIT complies with the applicable tax rules and avails itself of the opportunity to reduce its taxable income through distributions.
Income Taxes Prior to the IPO, OpCo and its subsidiaries were primarily entities that were treated as partnerships or disregarded entities for federal income tax purposes but were subject to certain minimal Texas franchise taxes. One of our subsidiaries is a qualified REIT for federal income tax purposes.
On November 25, 2025, OpCo issued $500.0 million aggregate principal amount of 6.25% fixed-rate senior unsecured notes due 2030. Income Taxes Prior to the IPO, OpCo and its subsidiaries were primarily entities that were treated as partnerships or disregarded entities for federal income tax purposes but were subject to certain minimal Texas franchise taxes.
Cash Flow The following tables summarizes our cash flow for the periods indicated: Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Year Ended December 31, 2024 2023 Consolidated Statement of Cash Flow Data: Net cash provided by operating activities $ 67,636 $ 53,042 Net cash used in investing activities (724,352 ) (2,772 ) Net cash provided by (used in) financing activities 655,925 (37,798 ) Net (decrease) increase in cash and cash equivalents $ (791 ) $ 12,472 Net Cash Provided by Operating Activities .
Cash Flow The following tables summarizes our cash flow for the periods indicated: Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 Year Ended December 31, Variance 2025 2024 Amount Percent Consolidated Statement of Cash Flow Data: Net cash provided by operating activities $ 126,273 $ 67,636 $ 58,637 87 % Net cash used in investing activities (233,074 ) (724,352 ) (491,278 ) (68 %) Net cash provided by financing activities 100,510 655,925 (555,415 ) (85 %) Net decrease in cash and cash equivalents $ (6,291 ) $ (791 ) $ (5,500 ) (695 %) Net Cash Provided by Operating Activities .
Net income and net income margin for the year ended December 31, 2023 include non-cash share-based compensation income of $17.2 million attributable to the NDB Incentive Units. Any actual cash expense associated with such LBH Incentive Units is borne solely by LandBridge Holdings and not the Company.
Net income and net income margin for the year ended December 31, 2025 include non-cash share-based compensation expense of $45.3 million, of which $8.8 million is attributable to RSUs issued by the Company and $36.5 million is attributable to LBH Incentive Units.
The incentive units expense increase is primarily due to the periodic remeasurements of NDB Incentive Units prior to the Division of $72.6 million when the awards were accounted for as liability awards at NDB LLC and new issuances and post-modification equity award accounting amortization of $18.6 million for the year ended December 31, 2024, as compared to income of $17.2 million due to remeasurement of the NDB Incentive Units for the year ended December 31, 2023.
The incentive units expense decrease is primarily due to the periodic remeasurements of NDB Incentive Units prior to the Division of $72.6 million in 2024 when the awards were accounted for as liability awards at NDB LLC.
See Note 10 — Share-Based Compensation within the notes to our condensed consolidated financial statements included elsewhere in this Annual Report. 81 Depreciation, depletion, amortization and accretion .
Refer to Note 10 — Share-Based Compensation within the notes to our consolidated financial statements included elsewhere in this Annual Report. Depreciation, depletion and amortization . Depreciation, depletion and amortization increased by $2.6 million. The increase was primarily attributable to amortization of intangibles acquired in the 2024 and 2025 acquisitions.
Oil and gas royalties are recognized as revenue as oil and gas are produced or severed from the mineral lease. The oil and gas royalties we receive are dependent upon market prices for oil and natural gas, and producer specific location and contractual price differences. Oil and gas royalties also include mineral lease bonus revenues.
The oil and gas royalties we receive are dependent upon producer-specific location, contractual price differences and market prices for oil and natural gas, which, given such prices’ volatility, may cause our oil and gas royalties to fluctuate. Oil and gas royalties also include mineral lease bonus revenues, which we receive by leasing our mineral interests to E&P companies.
Share-based compensation - Incentive Units for the year ended December 31, 2023, consists only of the NDB Incentive Units. NDB Incentive Units were liability awards resulting in periodic fair value remeasurement prior to the Division. Subsequent to the IPO, any actual cash expense associated with the LBH Incentive Units is borne solely by LandBridge Holdings and not the Company.
Share-based compensation - Incentive Units for the year ended December 31, 2024, consists of $18.7 million related to the LBH Incentive Units, and $72.6 million related to the NDB Incentive Units. NDB Incentive Units were liability awards resulting in periodic fair value remeasurement prior to the Division.
The increase was attributable to the change in share-based compensation expense of $112.4 million and increased cash expenses noted above. The share-based compensation consists of an increase related to the incentive units of $108.4 million and $4.0 million related to the issuance of RSUs.
The decrease was primarily attributable to the change in share-based compensation expense of $50.1 million, which consists of a decrease related to the incentive units of $54.8 million, partially offset by an increase of $4.8 million related to the issuance of RSUs.
Our SURAs typically do not include minimum purchase or use commitments by our customers but do generally provide for automatic renewal-based increases in royalties that are tied to the CPI or are negotiated on a case-by-case basis, depending on a number of factors, such as general economic conditions, the surface use of our land, competitor pricing and/or customer specific considerations.
Our SURAs generally have terms ranging from a minimum of five years to 10 years, impose only nominal obligations on us, typically do not include minimum purchase or use commitments by our customers but do generally provide for automatic renewal-based increases in royalties that are tied to the Consumer Price Index (“CPI”) or are negotiated on a case-by-case basis.
Year Ended December 31, 2024 2023 Net cash provided by operating activities $ 67,636 $ 53,042 Net cash used in investing activities (724,352 ) (2,772 ) Cash (used in) provided by operating and investing activities (656,716 ) 50,270 Adjustments: Acquisitions 723,367 - Proceeds from disposal of assets - (11 ) Free Cash Flow $ 66,651 $ 50,259 Operating cash flow margin (1) 62 % 73 % Free Cash Flow Margin 61 % 69 % (1) Operating cash flow margin is calculated by dividing net cash provided by operating activities by total revenue.
Year Ended December 31, 2025 2024 Net cash provided by operating activities $ 126,273 $ 67,636 Net cash used in investing activities (233,074 ) (724,352 ) Cash used in operating and investing activities (106,801 ) (656,716 ) Adjustments: Acquisitions 229,048 723,367 Proceeds from disposal of assets (210 ) - Free Cash Flow $ 122,037 $ 66,651 Operating cash flow margin (1) 63 % 62 % Free Cash Flow Margin 61 % 61 % (1) Operating cash flow margin is calculated by dividing net cash provided by operating activities by total revenue. 71 Liquidity and Capital Resources Overview Historically, our primary sources of liquidity have been capital contributions from our financial sponsor, cash flows from operating activities and borrowings under our debt instruments.
Our significant accounting policies are discussed in Note 2 — Summary of Significant Accounting Policies - Basis of Presentation and Consolidation of our Notes to the Consolidated Financial Statements. Share-Based Compensation Incentive Units The Company accounts for share-based compensation expense for incentive units granted in exchange for employee services.
Our significant accounting policies are discussed in Note 2 — Summary of Significant Accounting Policies of our Notes to the Consolidated Financial Statements.
The table below provides operational and financial data by oil and gas royalty stream for the periods indicated. 80 Year Ended December 31, 2024 2023 Net royalty volumes: Oil (MBbls) 179 225 Natural Gas (MMcf) 729 693 NGL (MBbls) 77 68 Equivalents (MBoe) 378 409 Equivalents (MBoe/d) 1.0 1.1 Oil and gas royalties (in thousands): Oil royalties $ 13,346 $ 17,138 Natural gas royalties 665 1,623 NGL royalties 1,610 1,322 Oil and gas royalties 15,621 20,083 Mineral lease income 406 660 Total oil and gas royalties $ 16,027 $ 20,743 Realized prices Oil ($/Bbl) $ 74.56 $ 76.17 Natural gas ($/Mcf) $ 0.91 $ 2.34 NGL ($/Bbl) $ 20.91 $ 19.44 Equivalents ($/Boe) $ 41.33 $ 49.10 Resource royalties .
Year Ended December 31, 2025 2024 Net royalty volumes: Oil (MBbls) 156 179 Natural Gas (MMcf) 656 729 NGL (MBbls) 66 77 Equivalents (MBoe) 331 378 Equivalents (MBoe/d) 0.9 1.0 Oil and gas royalties (in thousands): Oil royalties $ 9,940 $ 13,346 Natural gas royalties 1,270 665 NGL royalties 1,315 1,610 Oil and gas royalties 12,525 15,621 Mineral lease income 64 406 Total oil and gas royalties $ 12,589 $ 16,027 Realized prices Oil ($/Bbl) $ 63.72 $ 74.56 Natural gas ($/Mcf) $ 1.94 $ 0.91 NGL ($/Bbl) $ 19.92 $ 20.91 Equivalents ($/Boe) $ 37.84 $ 41.33 Other revenue .
The increase was primarily attributable to additional principal borrowings under our credit facility during the year ended December 31, 2024, as compared to borrowings under our then-existing debt instruments for the year ended December 31, 2023. See “ — Liquidity and Capital Resources ” for additional information regarding the Company’s debt instruments and interest expense.
Interest expense, net, increased by $9.4 million. The increase was primarily attributable to a higher weighted average debt balance during the year ended December 31, 2025, as compared to borrowings under our then-existing debt instruments for the year ended December 31, 2024.
More recently, high levels of activity in the Delaware Basin have resulted in industry consolidation and labor and supply chain challenges, which has impacted drilling, completion and production activity.
In the Delaware Basin, sustained high levels of exploration and production activity have led to labor shortages and supply chain disruptions. These challenges have directly impacted drilling, completion and production efforts by E&P companies.
The increase was primarily attributable to oil and natural gas gathering and transportation pipelines and produced water handling infrastructure of $8.1 million, $8.0 million related to the non-refundable option fee associated with the data center lease development agreement and $5.3 million in other surface and subsurface easements for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Easements and other surface-related revenues increased by $27.9 million. The increase was primarily attributable to oil and natural gas gathering and transportation pipelines and produced water handling infrastructure of $16.8 million, $5.2 million related to road easements, $3.9 million related to surface and subsurface drilling location easements, and $2.0 million in other surface easements and agreements. Resource sales .
Our SURAs typically obligate the operator to meter its volumetric utilization of infrastructure installed on our land and to include a report of such utilization for our review along with its periodic payment. Royalties we receive from operations under our SURAs include produced water transportation and handling operations, skim oil recovery and 74 produced water throughput and waste reclamation.
Royalties we receive from operations under our SURAs include produced water transportation and handling operations, skim oil recovery and produced water throughput and waste reclamation.
The increase was primarily attributable to brackish water royalties in connection with the East Stateline Ranch acquisition of $5.0 million and an increase attributable to sand mine royalty rates of $0.4 million and sand mine volumes of $1.0 million. Resource sales-related expense .
The increase was primarily attributable to brackish water royalties of $8.7 million as a result of the closing of the East Stateline Ranch Acquisition in the second quarter of 2024 and the Wolf Bone Ranch Acquisition in the fourth quarter of 2024. Additionally, sand mine royalties increased $1.5 million primarily related to higher throughput volumes. Oil and gas royalties .
For the year ended December 31, 2023, cash used in financing activities was primarily attributable to $105.2 million in member distributions and $1.7 million in deferred offering costs, partially offset by debt proceeds, net of repayments and issuance costs, of $69.5 million.
For the year ended December 31, 2025, cash provided by financing activities primarily consisted of $171.1 million of debt borrowings, net of repayments and debt issuance costs, partially offset by $63.7 million of dividends, dividend equivalents and distributions paid to shareholders, $5.8 million of required tax withholding related to the net settlement of Class A shares, and $1.1 million of offering costs paid related to the December 2024 private placement.
The increase was attributable to higher net income, net of non-cash items, of $9.2 million, and cash flow related to working capital accounts, primarily 83 accounts receivable and taxes payable, of $5.4 million. Please see “ —Results of Operations ” for more information regarding analysis of our consolidated statements of operations. Net Cash Used in Investing Activities .
Please see “ —Results of Operations ” for more information regarding analysis of our consolidated statements of operations. Net Cash Used in Investing Activities . Net cash used in investing activities decreased $491.3 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe posted price for WTI has ranged from a low of negative $36.98 per barrel in April 2020 to a high of $123.64 per barrel in March 2022. As of December 31, 2024, the Henry Hub spot market price of natural gas was $3.40 per MMBtu and the posted price for oil was $72.44 per barrel.
Biggest changeThe posted price for WTI has ranged from a low of $47.47 per barrel in January 2021 to a high of $123.64 per barrel in March 2022. As of December 31, 2025, the Henry Hub spot market price of natural gas was $4.00 per MMBtu and the posted price for oil was $57.26 per barrel.
These activity levels are influenced by numerous factors over which we have no control, including: the supply of and demand for oil and natural gas; the level of prices and expectations about future prices of oil and natural gas; the cost of exploring for, developing, producing and delivering oil and natural gas; the expected rates of declining current production; the discovery rates of new oil and natural gas reserves; available pipeline, rail and other transportation capacity; weather conditions; domestic and worldwide economic conditions; political instability domestically, as a result of the recent elections or otherwise, and in oil-producing countries; environmental regulations; technical advances affecting energy consumption; the transition to a low-carbon economy; the price and availability of alternative fuels; technological advancements in the production of alternative energy; the ability of energy companies to raise equity capital and debt financing; and industry consolidation and merger and divestiture activity among energy companies.
These activity levels are influenced by numerous factors over which we have no control, including: the supply of and demand for oil and natural gas; the level of prices and expectations about future prices of oil and natural gas; the cost of exploring for, developing, producing and delivering oil and natural gas; the expected rates of declining current production; the discovery rates of new oil and 76 natural gas reserves; available pipeline, rail and other transportation capacity; weather conditions; domestic and worldwide economic conditions; political instability domestically, as a result of the recent elections or otherwise, and in oil-producing countries; environmental regulations; technical advances affecting energy consumption; the transition to a low-carbon economy; the price and availability of alternative fuels; technological advancements in the production of alternative energy; the ability of energy companies to raise equity capital and debt financing; and industry consolidation and merger and divestiture activity among energy companies.
Assuming no change in the amount outstanding, the impact on interest expense of a 1.0% increase or decrease in the weighted average interest rate would be $3.9 million per year. We do not currently have or intend to enter into any derivative hedge contracts to protect against fluctuations in interest rates applicable to our outstanding indebtedness.
Assuming no change in the amount outstanding, the impact on interest expense of a 1.0% increase or decrease in the weighted average interest rate would be $0.7 million per year. We do not currently have or intend to enter into any derivative hedge contracts to protect against fluctuations in interest rates applicable to our outstanding indebtedness.
We may elect for outstanding borrowings under our credit facility to accrue interest at a rate based on either the Term SOFR, or the base rate, plus an applicable margin, which exposes us to interest rate risk to the extent we have borrowings outstanding under our credit facility.
We may elect for outstanding borrowings under the 2025 Revolving Credit Facility to accrue interest at a rate based on either the Term SOFR, or the base rate, plus an applicable margin, which exposes us to interest rate risk to the extent we have borrowings outstanding under the 2025 Revolving Credit Facility.
We examine the creditworthiness of any counterparty and customer and monitor our exposure to such counter-parties and customers through credit analysis, and monitoring procedures, including reviewing credit ratings, financial statements and payment history. For the year ended December 31, 2024, three customers accounted for 24%, 14% and 10% of our total revenues, 88 respectively.
We examine the creditworthiness of any counterparty and customer and monitor our exposure to such counter-parties and customers through credit analysis, and monitoring procedures, including reviewing credit ratings, financial statements and payment history. For the year ended December 31, 2025, three customers accounted for 25%, 12% and 10% of our total revenues, respectively.
For the year ended December 31, 2023, four customers accounted for 15%, 14%, 13% and 13% of our total revenues, respectively. No other customer accounted for more than 10% of total revenues. However, we believe that the credit risk associated with our counterparties and customers is acceptable.
For the year ended December 31, 2024, three customers accounted for 24%, 14% and 10% of our total revenues, respectively. No other customer accounted for more than 10% of total revenues. However, we believe that the credit risk associated with our counterparties and customers is acceptable.
Removed
As of December 31, 2024, we had $385.0 million of outstanding borrowings consisting of $30.0 million of revolving credit borrowings and $355.0 million of term loan borrowings.
Added
As of December 31, 2025, we had $70.0 million of borrowings under the 2025 Revolving Credit Facility. We are obligated to pay interest at variable rates and other customary fees on borrowings under this facility.
Removed
The weighted average interest rate on the borrowings outstanding under our Credit Facilities for the twelve months ended December 31, 2024 was 8.39% in the case of revolving credit borrowings, and 8.47% in the case of term loan borrowings.
Added
As of December 31, 2025, we also had aggregate principal amounts outstanding of $500.0 million under the Notes. Since our Notes bear interest at fixed rates and are carried at amortized cost, fluctuations in interest rates do not have any impact on our consolidated financial statements.
Removed
See “ — Debt Instruments — Credit Facility .” 89
Added
However, the fair value of the Notes will fluctuate with movements in market interest rates, increasing in periods of declining interest rates and declining in periods of increasing interest rates. See “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt Instruments ” for more information. 77