Kimbell Royalty (NYSE: KRP) raises 2026 output guidance after acquisitions
Rhea-AI Filing Summary
Kimbell Royalty Partners, LP (KRP) completed a dropdown acquisition of mineral and royalty interests and related assets from affiliated sellers valued at approximately $221.2 million, consisting of $74.9 million in cash and 9.5 million OpCo common units. The transaction is effective June 1, 2026, with GAAP revenues recognized from the August 21, 2026 closing date.
The acquired portfolio covers over 3 million gross acres and about 29,000 gross producing wells and is estimated, as of June 1, 2026, to produce roughly 2,347 Boe/d (841 Bbl/d oil, 569 Bbl/d NGLs, 5,624 Mcf/d gas). Kimbell entered a registration rights agreement obligating it to file a shelf registration statement for resales of common units issuable from the 9.5 million OpCo units and corresponding Class B units within 5 business days of closing and to seek effectiveness within 120 days.
Kimbell also updated 2026 guidance to reflect this dropdown and the earlier Mesa Royalties acquisition. For Q3 2026, net production is guided to 26.5–29.5 Mboe/d, and for Q4 2026 to 27.7–30.7 Mboe/d, with a target 75% payout ratio of projected cash available for distribution and use of the remaining 25% each quarter to reduce borrowings under its secured revolving credit facility.
Positive
- $221.2 million dropdown acquisition of mineral and royalty interests adds an estimated 2,347 Boe/d of production over 3 million gross acres and about 29,000 wells, further scaling and diversifying KRP’s asset base.
- Updated guidance indicates higher 2026 volumes, with Q4 2026 net production guided to 27.7–30.7 Mboe/d, reflecting contribution from both the Mesa and dropdown acquisitions.
- Capital allocation framework targets a 75% payout ratio while applying 25% of projected cash available for distribution each quarter to pay down borrowings under the secured revolving credit facility.
Negative
- None.
Insights
Analyzing...
8-K Event Classification
Key Figures
Key Terms
Drop Down financial
shelf registration statement regulatory
Registrable Securities financial
secured revolving credit facility financial
Payout Ratio financial
FAQ
What acquisition did Kimbell Royalty Partners (KRP) complete on August 21, 2026?
How will the KRP dropdown acquisition affect production and acreage?
What are KRP’s updated net production guidance ranges for Q3 and Q4 2026?
How is Kimbell Royalty Partners structuring distributions after the acquisitions?
What equity was issued in connection with the KRP dropdown transaction?
When will KRP recognize revenues from the dropdown and Mesa acquisitions under GAAP?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
(Exact name of registrant as specified in its charter)
(State
or other jurisdiction |
(Commission
|
(I.R.S.
Employer |
|
|
||
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including
area code: (
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):
Securities registered pursuant to 12(b) of the Act:
| Title of each class: | Trading symbol(s): | Name of each exchange on which registered: | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Introductory Note
On August 21, 2026, Kimbell Royalty Partners, LP, a Delaware limited partnership (“Kimbell”), completed the previously announced acquisition of mineral and royalty interests and related assets (the “Dropdown”) pursuant to a Purchase and Sale Agreement (the “Purchase Agreement”) with Rivercrest Capital Partners LP (“Rivercrest Capital”), Rivercrest Capital Partners II LP (“Rivercrest Capital II”) and Cupola Royalty Direct, LLC (“Cupola” and, together with Rivercrest Capital and Rivercrest Capital II, the “Sellers”).
Under the Purchase Agreement, Kimbell and its subsidiaries acquired (a) certain mineral interests, overriding royalty interests, royalty interests and other interests in oil and gas properties from the Sellers and (b) certain partnership interests in OGM Partners I, a Texas general partnership (“OGM”), and RCPTX, Ltd., a Texas limited partnership (“RCPTX”), that were not already owned by Kimbell (collectively, the “Acquired Assets”). The consideration included (i) approximately $75 million in cash and (ii) the issuance of 9,500,000 common units representing limited liability company interests (“OpCo Common Units”) in Kimbell Royalty Operating, LLC (“OpCo”) and an equal number of Class B units representing limited partner interests in Kimbell (“Class B Units”). The OpCo Common Units, together with the Class B Units, are exchangeable for an equal number of common units representing limited partner interests in Kimbell (“Common Units”). The consideration for the Dropdown is subject to certain adjustments as set forth in the Purchase Agreement. The Dropdown has an effective date of June 1, 2026.
Item 1.01. Entry into a Material Definitive Agreement.
Registration Rights Agreement
On August 21, 2026, pursuant to the terms of the Purchase Agreement, Kimbell and the Sellers entered into a registration rights agreement (the “Registration Rights Agreement”) pursuant to which, among other things, Kimbell has agreed to prepare a shelf registration statement with respect to the resale of the Common Units issuable upon the conversion of the OpCo Common Units and a corresponding number of Class B Units issued to the Sellers under the Purchase Agreement (“Registrable Securities”) that would permit some or all of the Registrable Securities to be resold in registered transactions (the “Shelf Registration Statement”), file the Shelf Registration Statement with the Securities and Exchange Commission (“SEC”) within 5 business days of the closing of the Dropdown and use its reasonable best efforts to cause the Shelf Registration Statement to become effective as soon as reasonably practicable following such filing, but in any event within 120 days of the closing of the Dropdown.
Certain officers and managers or controlling persons of the Sellers also serve as officers and/or directors of Kimbell’s general partner, OpCo and their respective subsidiaries, and certain of the Sellers are direct or indirect beneficial owners of limited partner interests in Kimbell and OpCo.
The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the Registration Rights Agreement, a copy of which is filed as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated into this Item 1.01 by reference.
Item 3.02. Unregistered Sales of Equity Securities.
As previously reported by Kimbell and pursuant to the Purchase Agreement, on July 16, 2026, Kimbell and OpCo agreed to issue OpCo Common Units and Class B Units, respectively, in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), in reliance on the exemptions set forth in Section 4(a)(2) of the Securities Act. Pursuant to the terms of the Purchase Agreement, Kimbell and OpCo issued 9,500,000 OpCo Common Units and an equal number of Class B Units to the Sellers on August 21, 2026. The OpCo Common Units, together with the Class B Units, are exchangeable for an equal number of Common Units. Any future issuance of Common Units pursuant to an exchange election by the holders of such OpCo Common Units and such Class B Units will also be undertaken in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 4(a)(2) thereof.
Item 7.01. Regulation FD Disclosure.
On August 21, 2026, Kimbell issued a news release announcing that it has completed the Dropdown. On August 24, 2026, Kimbell issued a news release announcing updated 2026 guidance. A copy of each news release is attached hereto, furnished as Exhibit 99.1 and Exhibit 99.2 to this Current Report on Form 8-K and incorporated by reference into this Item 7.01.
The information set forth in this Item 7.01 (including Exhibit 99.1 and Exhibit 99.2) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall such information be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.
Item 8.01. Other Events.
On August 21, 2026, Kimbell completed the Dropdown, pursuant to the terms of the Purchase Agreement. The terms and provisions of the Purchase Agreement are described in the “Introductory Note” above (and incorporated by reference herein) and in Kimbell’s Current Report on Form 8-K filed with the Commission on July 17, 2026.
The aggregate consideration for the Dropdown consisted of (i) approximately $75 million in cash and (ii) the issuance of 9,500,000 OpCo Common Units and an equal number of Class B Units. The Sellers paid $0.05 per Class B Unit issued at the closing of the Dropdown as consideration for the Class B Units, which is consistent with the amount paid per Class B Unit by all current holders of Class B Units.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Number | Description | |
| 4.1 | Registration Rights Agreement, dated as of August 21, 2026, between Kimbell Royalty Partners, LP and the recipients named therein. | |
| 99.1 | News release issued by Kimbell Royalty Partners, LP, dated August 21, 2026. | |
| 99.2 | News release issued by Kimbell Royalty Partners, LP, dated August 24, 2026. | |
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| KIMBELL ROYALTY PARTNERS, LP | ||
| By: | Kimbell Royalty GP, LLC, | |
| its general partner | ||
| By: | /s/ Matthew S. Daly | |
| Matthew S. Daly | ||
| Chief Operating Officer | ||
| Date: August 24, 2026 | ||
Exhibit 99.1
NEWS RELEASE
Kimbell Royalty Partners Closes $ 221.2 Million Drop Down Acquisition
FORT WORTH, Texas, August 21, 2026 – Kimbell Royalty Partners, LP (NYSE: KRP) (“Kimbell” or the “Company”), a leading owner of oil and gas mineral and royalty interests in over 17 million gross acres in 28 states, today announced that it has closed the previously announced purchase of mineral and royalty interests from certain affiliated sellers in a cash and unit transaction valued at approximately $221.2 million1 (the "Drop Down"). The purchase price for the Drop Down was comprised of $74.9 million in cash (approximately 34% of the total consideration), and 9.5 million common units of Kimbell Royalty Operating, LLC ("OpCo") valued at approximately $146.3 million. Kimbell is entitled to all cash flow from production attributable to the Drop Down since the effective date of June 1, 2026. Revenues and certain other operating statistics under generally accepted accounting principles will be recorded for the Drop Down beginning on the closing date of August 21, 2026.
Kimbell estimates that, as of June 1, 2026, the Drop Down currently produces approximately 2,347 Boe/d (841 Bbl/d of oil, 569 Bbl/d of NGLs, and 5,624 Mcf/d of natural gas) (6:1). The Drop Down portfolio spans over 3 million gross acres with over 29,000 gross producing wells in premier areas of the Eagle Ford, Permian, Mid-Con and Appalachia, further expanding Kimbell's scaled and diversified mineral and royalty position.
About Kimbell Royalty Partners
Kimbell (NYSE: KRP) is a leading oil and gas mineral and royalty company based in Fort Worth, Texas. Kimbell owns mineral and royalty interests in over 17 million gross acres in 28 states and in every major onshore basin in the continental United States, including ownership in more than 137,000 gross wells. To learn more, visit http://www.kimbellrp.com.
Forward-Looking Statements
This news release includes forward-looking statements. These forward-looking statements, which include statements regarding the anticipated benefits of the Drop Down and operational data with respect to the Drop Down, involve risks and uncertainties, including risks that the anticipated benefits of the Drop Down are not realized; risks relating to Kimbell's integration of the Drop Down assets; and risks relating to Kimbell's business, prospects for growth and acquisitions and the securities markets generally. Except as required by law, Kimbell undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this news release. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in Kimbell's filings with the Securities and Exchange Commission ("SEC"). These include risks inherent in oil and natural gas drilling and production activities, including risks with respect to low or declining prices for oil and natural gas that could result in downward revisions to the value of proved reserves or otherwise cause operators to delay or suspend planned drilling and completion operations or reduce production levels, which would adversely impact cash flow; risks relating to the impairment of oil and natural gas properties; risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in oil and natural gas prices; risks relating to Kimbell's ability to meet financial covenants under its credit agreement or its ability to obtain amendments or waivers to effect such compliance; risks relating to Kimbell's hedging activities; risks of fire, explosion, blowouts, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; risks relating to delays in receipt of drilling permits; risks relating to unexpected adverse developments in the status of properties; risks relating to borrowing base redeterminations by Kimbell's lenders; risks relating to the absence or delay in receipt of government approvals or third-party consents; risks relating to acquisitions, dispositions and drop downs of assets; risks relating to Kimbell's ability to realize the anticipated benefits from and to integrate acquired assets, including the assets acquired in the Drop Down; and other risks described in Kimbell's Annual Report on Form 10-K and other filings with the SEC, available at the SEC's website at www.sec.gov. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this news release.
Contact:
Zach Vaughan
Dennard Lascar Investor Relations
krp@dennardlascar.com
(713) 529-6600
1 Purchase price reflects Kimbell's $15.40 per unit closing price as of 8/21/2026.
Exhibit 99.2
Kimbell Royalty Partners Boosts 2026 Production Guidance
Relative to prior 2026 guidance issued with Q4 2025 earnings release, Kimbell expects:
| o | Record daily production, which at its midpoint for Q3 2026 and Q4 2026 guidance is a 10% and 15% increase, respectively, over the midpoint of prior 2026 guidance |
| o | Increase in oil production mix with Permian leading all categories including revenue, production, DUCs, permits and PUDs |
| o | Reduction in expected cash G&A per Boe, reflecting positive operating leverage |
FORT WORTH, Texas, August 24, 2026 – Kimbell Royalty Partners, LP (NYSE: KRP) (“Kimbell” or the “Company”), a leading owner of oil and gas mineral and royalty interests in over 17 million gross acres in 28 states, today announced updated guidance for the third and fourth quarters of 2026. The revised guidance is in connection with the previously announced closing of the purchase of mineral and royalty interests held by Mesa Royalties (portfolio companies of funds managed by NGP), in a cash and unit transaction valued at approximately $145.9 million (the “Mesa Acquisition)”, and the previously announced closing of the purchase of certain oil and gas royalty interests from certain affiliated sellers in a cash and unit transaction valued at approximately $221.2 million (the “Drop Down” and, together with the Mesa Acquisition, the “Acquisitions”).
Kimbell is entitled to all cash flow from production attributable to the Acquisitions beginning on and after the effective date of June 1, 2026 for each. Revenues and certain other operating statistics under generally accepted accounting principles (“GAAP”) were recorded for the Mesa Acquisition beginning on the closing date of June 22, 2026, and for the Drop Down beginning on the closing date of August 21, 2026.
2026 Guidance
Below is Kimbell’s updated guidance for the third and fourth quarters of 2026. The guidance for the third quarter of 2026 reflects a full quarter of production and operating statistics from the Mesa Acquisition and only 41 days of production and operating statistics from the Drop Down, based on management estimates, while the fourth quarter of 2026 reflects full quarters of production and operating statistics from both Acquisitions based on management estimates:
| Kimbell Royalty Partners LP | |||
| Q3 2026 | |||
| Net Production - Mboe/d (6:1) | 26.5 | - | 29.5 |
| Oil Production - % of Net Production | 32% | - | 36% |
| Natural Gas Production - % of Net Production | 43% | - | 47% |
| Natural Gas Liquids Production - % of Net Production | 19% | - | 23% |
| Unit Costs ($/boe) | |||
| Marketing and other deductions | $1.45 | - | $2.25 |
| Depreciation and depletion expense | $13.00 | - | $20.00 |
| G&A | |||
| Cash G&A | $2.35 | - | $2.55 |
| Non-Cash G&A | $1.40 | - | $1.80 |
| Production and ad valorem taxes - % of Oil, Natural Gas and NGL Revenues | 6.0% | - | 8.0% |
| Payout Ratio ⁽¹⁾ | 75% | ||
| Q4 2026 | |||
| Net Production - Mboe/d (6:1) | 27.7 | - | 30.7 |
| Oil Production - % of Net Production | 32% | - | 36% |
| Natural Gas Production - % of Net Production | 43% | - | 47% |
| Natural Gas Liquids Production - % of Net Production | 19% | - | 23% |
| Unit Costs ($/boe) | |||
| Marketing and other deductions | $1.45 | - | $2.25 |
| Depreciation and depletion expense | $13.00 | - | $20.00 |
| G&A | |||
| Cash G&A | $2.25 | - | $2.45 |
| Non-Cash G&A | $1.40 | - | $1.80 |
| Production and ad valorem taxes - % of Oil, Natural Gas and NGL Revenues | 6.0% | - | 8.0% |
| Payout Ratio ⁽¹⁾ | 75% | ||
(1) The Company intends to pay out 75% of its projected cash available for distribution in quarterly distributions and utilize 25% of projected cash available for distribution to pay down a portion of the outstanding borrowings under its secured revolving credit facility each quarter.
About Kimbell Royalty Partners
Kimbell (NYSE: KRP) is a leading oil and gas mineral and royalty company based in Fort Worth, Texas. Kimbell owns mineral and royalty interests in over 17 million gross acres in 28 states and in every major onshore basin in the continental United States, including ownership in more than 137,000 gross wells. To learn more, visit http://www.kimbellrp.com.
Forward-Looking Statements
This news release includes forward-looking statements. These forward-looking statements, which include updated financial and operating guidance, as well as statements regarding the anticipated benefits of the Acquisitions and operational data with respect to the Acquisitions, involve risks and uncertainties, including risks that the anticipated benefits of the Acquisitions are not realized; risks relating to Kimbell’s integration of the Acquisitions’ assets; and risks relating to Kimbell’s business, prospects for growth and acquisitions and the securities markets generally. Except as required by law, Kimbell undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this news release. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in Kimbell’s filings with the Securities and Exchange Commission (“SEC”). These include risks inherent in oil and natural gas drilling and production activities, including risks with respect to low or declining prices for oil and natural gas that could result in downward revisions to the value of proved reserves or otherwise cause operators to delay or suspend planned drilling and completion operations or reduce production levels, which would adversely impact cash flow; risks relating to the impairment of oil and natural gas properties; risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in oil and natural gas prices; risks relating to Kimbell’s ability to meet financial covenants under its credit agreement or its ability to obtain amendments or waivers to effect such compliance; risks relating to Kimbell’s hedging activities; risks of fire, explosion, blowouts, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; risks relating to delays in receipt of drilling permits; risks relating to unexpected adverse developments in the status of properties; risks relating to borrowing base redeterminations by Kimbell’s lenders; risks relating to the absence or delay in receipt of government approvals or third-party consents; risks relating to acquisitions, dispositions and drop downs of assets; risks relating to Kimbell’s ability to realize the anticipated benefits from and to integrate acquired assets, including the assets acquired in the Acquisition; and other risks described in Kimbell’s Annual Report on Form 10-K and other filings with the SEC, available at the SEC’s website at www.sec.gov. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this news release.
Contact:
Zach Vaughan
Dennard Lascar Investor Relations
krp@dennardlascar.com
(713) 529-6600