19 thoughts on “Poor Governance Continues

  1. If the land assets weren’t so valuable I would have sold. I’m hopeful and doubtful at the same time. Hope everyone has a good weekend. All of your comments are great to read because you are all dealing with the same ‘shite’.

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  2. I couldn’t agree more, @Smyth. I assume that the joke trustees are using the plunging oil prices (and today’s non-OPEC fiasco) as an excuse to delay this. Does anyone have the contact information for the new IR guy?

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  3. You would think that on the second delay they would at least provide some color on WHY they are delaying. The lack of transparency is very disappointing given how long it’s been since they reached the conclusion to recommend conversion. One does have to wonder what the hold-up is.

    Not saying at all this is what’s happening, but worth keeping in mind that Glover and Packer both made $3.7 MM in 2019. That translates to roughly $70K per week for each. So IF they were worried that accelerating the conversion accelerates the day when they are replaced, each 2 week period puts another $140K in each of their pockets.

    I know I’m preaching to the choir here, but I am beyond ready for greater disclosure. The new presentations are an improvement, but still fall short. For one I’d like to see a clear estimate of the PDP-10 value of the current royalty production under the current strip pricing and a flat notional pricing (say $2.50 / MMBtu Henry Hub and $50 WTI). These are bare minimum metrics any O&G company has ready-to-go on a quarterly (if not monthly) basis. I’d like to see a generalized type curve that can be used to project incremental production, on average, across certain key acreage positions. I’d like to know what the average midstream/”to market” costs are for TPL’s production. If they lack the in-house expertise to generate these and cannot collect this data from their royalty partners, there are a great many reservoir engineering firms that would be happy to provide them at a drop-in-the-bucket cost. I recognize there could be issues with sharing non-public detail that the operators on TPL’s acreage may not want shared specific to them, but a generalized value across all operators would likely solve those issues.

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    • Doubt that this is a Packer/Glover issue. More likely it’s a trustee issue. They are probably trying to stack the board with a majority of friendly parties and protect it. If I was them (and acting in my own interest), I would set the first board meeting 3 years from spin date, have a classified board, not allow for the removal of directors, and prohibit shareholders from calling a special meeting or amending the articles and by-laws. I am sure that they are 1) agreeing to a conversion but 2) only under a scenario where they entrench themselves on the board.

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  4. This second amendment appears to be a date change only. First ask for 2 weeks delay, Second ask for another two weeks delay. Cant decipher if the hangup is with some settlement issue or conversion issue. Either way, not a good sign for us unit holders.

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  5. Why don’t we all contact the judge that ordered the special committee? Does anybody have the contact info?


  6. I am hoping that it is delayed as Murray Stahl and company are driving a hard bargain and they are not willing to vote their shares. I would like to think they have the upper hand but we will see. I expect continued weakness as the current commodity prices are going to lead to involuntary cutbacks from many of trusts customers. Its not the end of the world as the hydrocarbons are still there to be exploited at a later date with potentially higher prices and hopefully meaningful buybacks in the meantime. OXY in particular is going to have issues. XOM is gonna back off a little. Like most I think the current two trustees are poison so I am hoping that we get to vote on them at some point.

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    • I agree and suspect you are right About Murray and Co pushing for the right thing . The horizon guys are patient. They’ve been investors for over two decades and are the reason a good number of us have ever even heard of TPL.

      It’s also the case that when things involve judges and the sec you have to be careful, respect timelines, etc. incumbent trustees don’t have the benefit of the doubt in my mind but horizon does. We’re it not for them we’d all have the pigeon trustee originally proposed that horizon pushed back on.
      That said, would. Ennice to be focused on how to take advantage of this environment for tpl’s long term benefit instead of fighting for decent governance.

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    • I’m going to add some too.

      We are caught in a oil macro of a pissing match of poker bluffing between Russia and Saudi. Hell, lest we not forget the clown show with the trustees and the C-Corp conversion. I always keep this in mind about the land in Texas, it was here before any of them and will be after they are gone. We have two black swans on top of each other. We are dealing with the virus and an oil crisis. Nothing really makes sense.

      So what am I doing? I’m making authentic Texas chili. At least I think it is. haha I’ve got to say I never thought this investment would be such a thrill of a ride. We have our highs and lows. It seems to alternate between one or the other. Thanks to all of you for your comments and insights. Keep your spirits up!

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