Goalposts Moved

They still don’t respect you.

Two steps forward on the business front as of late. One giant step back in terms of governance.

If you were preparing a proposal, your time frame just got shortened from two months to 10 days. This is disgusting.

Hey Rhys Best and Karl Kurz, is this what you signed up for? Do you think this is right? Do you think this is how a modern corporation should be governed? Are you ready to associate yourself with this circus? Cook, Duganier, and Epps have already compromised their reputations by being party to continued ugly displays like this. Are you willing to compromise your good names?

Readers, are you planning a proposal? Each shareholder is allowed one. If you need ideas or help, email me. The clock is ticking.

What they said on 12/7/21

In order for any stockholder proposal submitted pursuant to Rule 14a-8 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the Company’s bylaws, to be included in the Company’s Proxy Statement to be issued in connection with the 2022 Annual Meeting of Stockholders, such stockholder proposal must be received by the Company no later than August 8, 2022. Any such stockholder proposal submitted, including any accompanying supporting statement, may not exceed 500 words, as per Rule 14a-8(d) of the Exchange Act. Any such stockholder proposals submitted outside the processes of Rule 14a-8 promulgated under the Exchange Act, which a stockholder intends to bring forth at the Company’s 2022 annual meeting of stockholders, will be untimely unless it is received between August 31, 2022 and September 30, 2022 in accordance with our bylaws and Rule 14a-4 of the Exchange Act. Any changes to such dates will be disclosed in our periodic reports on Form 10-Q or Form 10-K, or current reports on Form 8-K, filed with the Securities and Exchange Commission (“SEC”). Any such request should be directed to the Company’s Secretary at 1700 Pacific Avenue, Suite 2900, Dallas, Texas, 75201 or (214) 969-5530.

What they said today

Texas Pacific Land Corporation (the “Company”) expects to hold its 2022 annual meeting of stockholders on November 16, 2022. Any stockholder proposal to be submitted pursuant to Rule 14a-8 promulgated under the Securities Exchange Act of 1934, as amended, must be received by the Corporate Secretary at the principal executive offices of the Company no later than June 18, 2022, which the Company believes is a reasonable time before it begins to print and distribute its proxy materials.

Any other stockholder proposal or nomination that a stockholder intends to present at the Company’s 2022 annual meeting of stockholders will be untimely unless it is received between July 19, 2022 and August 18, 2022 in accordance with the advance notice provisions of our bylaws. Please refer to our bylaws for additional requirements in connection with such submissions.

TPL Puts on Laser Eyes

TPL and Mawson press release

Based on utilization of current generation Bitcoin mining hardware, these new facilities – which will be owned and operated by Mawson – could accommodate up to 2.0 Exahash of Bitcoin mining operational capacity. TPL and JAI will earn a net royalty interest and retain an option to acquire an equity stake. Mawson intends to participate in demand response programs as part of its power procurement strategy and is evaluating behind-the-meter renewable solutions. Mawson and JAI have four locations planned in Texas, with two located on TPL’s surface. Construction is expected to commence in the second quarter of 2022, and operations targeted to begin in the fourth quarter of 2022.

“This project marks the beginning of TPL’s journey into bitcoin, and we are fortunate to collaborate with Mawson and JAI as two highly regarded companies in the bitcoin mining industry,” said Tyler Glover, CEO of TPL. “We believe TPL’s extensive surface footprint in West Texas can serve as a premier destination for the bitcoin mining industry, providing site locations proximate to existing grid infrastructure and excellent solar and wind resource for future renewable power procurement. We are aligned to see this venture succeed and scale as we look to leverage our unique asset base, industry and customer relationships, and the region’s energy abundance. For TPL, our shareholders will benefit from a unique royalty stream while retaining an option to participate as an equity partner.”

Mawson press release

The sites have been selected due to the substantial local infrastructure already available to Mawson. Mawson is now working to secure Power Purchase Agreements (PPA) required to commission the facility and will update stockholders on this front in due course.

Mawson has collaborated with JAI Energy and Texas Pacific Land Corporation (NYSE:TPL) on the project, both of which will share in the revenue streams generated by the project, as well as have an option to acquire an equity interest in Luna Squares Texas LLC.

Texas Pacific Land Corporation, one of the largest landowners in the State of Texas, is the landlord of two of the sites. The other two sites are situated on family-owned private lands.

A new chapter for TPL. The royalty collector/landlord nature of the deal is certainly appealing due to low capital intensity. I’m out of my element here as far as estimating revenue contribution though it looks like there is a fair amount of work to be done before cashing checks becomes a reality. This business is in its infancy as a whole so it’s probably best to keep expectations in check.

Per Justin Ballard (JAI CEO), the project should be 100% online by the end of Q4 2022.

Glover’s quote mentions wind and solar though it looks like JAI has expertise in generating via gas that would have otherwise been flared. With that, I’m confused on the power source here. Let me know if I’m missing something.

Lastly, it’s worth internalizing TPL’s option to buy equity in the JV. Call options are nice provided they are managed efficiently.


Mawson matches sustainable energy infrastructure with next-generation mobile data centre (MDC) solutions, enabling low-cost Bitcoin production and on-demand deployment of infrastructure assets. With a strong focus on shareholder returns and an aligned board and management, Mawson Infrastructure Group is emerging as a global leader in ESG focused Bitcoin mining and digital infrastructure.

Mawson investor deck

JAI Energy

JAI Energy was formed specifically to mine and provide Bitcoin mining services for applications involving stranded, flared, and poor economic natural gas streams. JAI Energy has its own mining farm located in Wyoming, where it is on pace to be the largest Bitcoin mining farm in the State by August 2021. JAI is also providing solutions for producers, midstream groups, and energy providers to allow them to capture value off their excess energy. JAI is based out of Casper, Wyoming which is also where all manufacturing of its portable mining data centers takes place.



HOUSTON–(BUSINESS WIRE)– Aris Water Solutions, Inc. (NYSE: ARIS) (“Aris,” “Aris Water,” or the “Company”) announced today a long-term full cycle water management agreement with Chevron U.S.A. Inc. (“Chevron”) in the Permian Basin. Under the arrangement, Aris will provide produced water handling and recycling services in a portion of Chevron’s core position in the Delaware Basin, including acreage in Eddy and Lea Counties, New Mexico and Culberson and Reeves Counties, Texas. The agreement will facilitate Chevron’s increased use of recycled water in their operations and reduce their use of groundwater, improving their water sustainability footprint.

Aris 1Q earnings

In March of 2022, Aris announced an expansion of its alliance with Texas Pacific Land Corporation (“TPL”). As part of the expanded relationship, Aris has access across TPL’s Northern Delaware surface acreage to provide a full suite of produced water services, including incremental water recycling for two leading large-cap customers operating on TPL royalty and surface acreage. In addition, Aris received key additional shallow interval water handling locations with the ability to permit more as needed.

From Aris earnings call:

Additionally, earlier in the first quarter, we announced our expanded alliance with Texas Pacific Land Corporation. Importantly, Aris now has expanded access across Texas Pacific’s Northern Delaware surface acreage in Texas to provide a full suite of produced water services, including incremental water recycling for two large leading customers. We also received key additional shallow interval water handling locations, as well as the option to permit additional locations that will allow us to expand our system efficiently and as needed over time alongside the growth of our customers.

The Aris business and offering remains in growth mode and continue to provide both significant operating cash flow and opportunities to reinvest this cash for attractive returns under existing and new long-term contracts.

Our agreement with Chevron is a great indication of that strategy. We secured a long-term full cycle agreement with a premier operator that underwrites an attractive return on incremental capital that expands our network. We will continue to invest and grow alongside existing and new customers at compelling returns while working closely with regulators, customers and other key stakeholders to encourage reuse and pioneer beneficial reuse solutions. We will evaluate technologies and capabilities that can accelerate our efforts around water treatment and we’ll make targeted efficient investments that can help move the industry forward.

We are optimistic as we continue to hit record volumes help the industry achieve its sustainability goals and prudently invest for additional long-term growth alongside our premier contracted operators. We are tremendously proud of our strategic alignment with Texas Pacific Land Corporation and Chevron, both of which are significant milestones and endorsements of our capabilities. This momentum reflects our demonstrated track record built for purpose infrastructure and dedicated team.

Praneeth Satish, Analyst:

Hi, good morning. I guess to start, can you maybe just give us a sense broadly in terms of drilling activity and appetite from producers across your footprint? I guess mainly, I’m just asking, is there any more appetite from public E&Ps to ratchet up drilling? Or is it mostly the private majors that are driving the growth?

Bill Zartler, Founder and Executive Chairman:

Well, you have to ask them, but for the most part, I mean I think incrementally, we are seeing, if the tendency was to finish earlier to wrap up, you’re going to keep that rig working a little while longer right now, so I think that is I think Chevron has indicated a slow ramp-up. The rig count currently today doesn’t really reflect that. So, I think that we’re rolling into a set of economics that are pretty compelling for operators. I don’t think that the dam is going to break loose, and you’re going to see people go up 4 or 5 times, but I do see incremental increases in activity levels among some of the larger contracts, larger players on top of clearly these smaller players, more rapid increases.

Can’t Disagree

More of this!

1Q22 Earnings



Call transcript

Better than a sharp stick in the eye. Expenses flat from a year ago. Water segment continues to grow (but could it grow faster?). Missed “estimates” but they aren’t worth much for a company that has fairly limited control over its top line quarter to quarter.

This won’t be popular in the comment section, but it is worth recognizing that the top line from the water business covers the non-tax expenses for the whole organization. In that sense, you get the rest of the L + R revenue for free.

Share count down 17bp year over year. ~13.5k shares purchased. Average LTM price was ~$1,350. So figure ~$18MM spent on buybacks. The $20 special dividend, in contrast, will drain $155MM from the balance sheet. I’d prefer buybacks. The div will get some eyeballs, however.

$507MM on balance sheet prior to div payments. Plenty of room to spend down the $100MM (needs to be bigger) buyback authorization. Total left side of the balance sheet is $857MM. Big number.

No land sales or purchases.

I scrolled past the many pages on RSUs in the Q. Makes my head hurt.

DUCs up! 556 vs 452 a year ago.

$94.24 realized on oil. $5.33 on nat gas.

No unexpected severance or out of period tax adjustments, so that’s nice.

BRK Annual Meeting

Buffett and Munger on oil, buybacks, and TPL (4:49:25)


“They bought stock week, after week, after week.”

Keep listening into the early 5th hour for thoughts of WB and CM on independent directors.

It Takes Two

All the fun stuff always happens when I’m on vacation. Two new directors added to the board to take the place of DM. Board goes to ten.

Hard to deny that both of these directors have significant industry and leadership experience. Maybe we should interpret the quotes from Oliver and Stahl in the press release as a sign that everyone is playing nice?


Land of Many Uses


West Texas is a mecca of renewable energy in the United States.

“You get this perfect overlap with both sun quality and wind speed in West Texas,” said Shaun Connell, executive vice president of power at Houston-based tech company Lancium.

But a lot of that wind and solar power is concentrated in remote parts of the state. With no financial incentive, there’s little reason to build out renewable infrastructure to harness this energy.

Enter bitcoin miners. When these energy buyers co-locate with renewables, it creates a financial incentive for buildout and improves the core economics of renewable power production, which has been fraught with volatility.

Can We Call Elon?

Twitter Inc (TWTR.N) said on Tuesday it will offer Tesla boss and entrepreneur Elon Musk a seat on its board of directors, a position he plans to use to bring about significant improvements at the social media site.

The move came after Musk disclosed in a regulatory filing on Monday that he had amassed a 9.2% stake in Twitter, making him its largest shareholder.

Musk to join Twitter board, promises change | Reuters

Wild. Musk buys 10% of the company and they ask him to join the board! Where I come from, the first instinct is to hold large investors in contempt and litigate against them.

Open Letter to the Board

“The iron rule of nature is: you get what you reward for. If you want ants to come, you put sugar on the floor.” – Charlie Munger

In what seems to be a recurring occurrence, I’ve been asked by another large TPL investor to post a letter to the board. I have verified this individual to be an institutional investor with a material holding of TPL shares.

I happen to think this investor is 100% on point in regards to compensation. It is important for drivers of compensation to be aligned with the drivers of shareholder value. With TPL being a unique asset, traditional metrics don’t readily apply.

Lastly, I also agree that it is time for the board to take an interest in the shareholders. Hey Independents, what are you doing? Do you care? Are you along for the ride? In it for the paycheck? Do you care about your legacy as a steward of capital? Are you bound by something stronger than fiduciary duty? Do you ever want to get elected again? Do something!

If you agree, save this letter down and send it to the Board via IR with your comments.

Eyes on Fall 2022

In anticipation of the fall 2022 board meeting, I will be leaving this post pinned at the top. Dates, deadlines, etc will be updated as they are known. If you have any information pertaining to procedure, best practices, and the like, please share and I will update.

Board Nominees:

This year, the Class II members of the board will see their terms expire. Up for re-election will be Donald Cook, Donna Epps, and Eric Oliver. Will an alternate slate be proposed?

Shareholder Proposals:

Prior to the release of the proxy statement, shareholders can submit proposals in the hopes of ultimately getting them into the voting process. TPL loves to reject proposals, but we’ve seen success here.


We’re still watching and waiting. The delay buys the board an extra year. Maybe it gets to a real vote this fall and maybe that vote takes effect in 2023. Things move slow, but they move.

All governance documents


McGinnis Resigns


On March 28, 2022, the Board of Directors (the “Board”) of Texas Pacific Land Corporation (the “Company”) accepted the tendered resignation of Dana McGinnis, a member of the Company’s Board of Directors, effective immediately. Mr. McGinnis previously tendered his resignation, subject to Board acceptance, in response to having received less than a majority of the votes cast for his election at the 2021 Annual Meeting, in accordance with the Section 2.10 of the Company’s Amended and Restated Bylaws.

The Board’s Nominating and Corporate Governance Committee has recommended several highly qualified candidates to the Board and the Board is expected to make an appointment to fill the vacancy resulting from Mr. McGinnis’ resignation in the near future.