Key Highlights

  • Third-quarter production reached a record 27,565 barrels of oil equivalent per day.
  • Run-rate production rose to 28,910 barrels of oil equivalent per day after the Acquisition closed.
  • Oil, Natural Gas and NGL revenues were $96.9 million, or $104.6 million including acquired production.
  • The Partnership declared a distribution of $0.45 per common unit.

Kimbell Royalty Partners (NYSE:KRP), a Fort Worth-based owner of oil and natural gas mineral and royalty interests, reported third-quarter 2026 results for the period ended September 30, 2026. Production set a quarterly high, helped by a drop-down acquisition that closed on August 21, 2026. The partnership also declared a distribution of $0.45 per common unit, and it reported an increase in its secured revolving Credit facility's borrowing base.

The record production figure reflects the combined effect of the company's existing royalty base and the acquired interests. Because acquired production contributed only from the August closing forward, readers should look to the run-rate figure of 28,910 Boe per day as a more representative measure of the current daily output.

Production Levels and Acquired Volumes

Third-quarter daily production totaled 27,565 barrels of oil equivalent, or Boe, per day, a record for the company. The figure converts natural gas to oil equivalent using a 6-to-1 ratio, which is the standard convention in the sector for combining oil and gas volumes into a single measure.

The figure includes 41 days of production from the $221.2 million drop-down acquisition, which closed on August 21, 2026, with an effective date of June 1, 2026. After the closing, run-rate production reached 28,910 Boe per day. Because the acquired volumes only partly reflect the quarter, the run-rate figure gives a better sense of the production base going forward.

Revenue, Earnings and Adjusted EBITDA

Oil, natural gas and NGL revenues for the quarter were $96.9 million. Including the acquired production from its effective date through September 30, 2026, revenues were $104.6 million. The difference shows the contribution of the acquired Assets during the period before the closing, which the partnership includes in its consolidated results.

Net income for the quarter was approximately $17.3 million. Adjusted EBITDA reached $80.4 million, and consolidated adjusted EBITDA including the acquired production from the effective date was $87.5 million. Adjusted EBITDA is a non-GAAP measure commonly used by royalty and mineral owners to track cash generation before financing and tax items.

The $0.45 per unit distribution is declared for the quarter, and its level depends on the cash generated after expenses and Debt service. Investors comparing distributions across quarters will want to see whether the higher production base supports a sustained payout.

Distribution and Capital Structure

The partnership declared a distribution of $0.45 per common unit. Royalty partnerships of this type distribute a large share of their Cash Flow to unitholders, so the distribution level is a key measure of how Commodity prices and production translate into payouts.

On October 15, 2026, the borrowing base and elected commitments on Kimbell's secured revolving credit Facility increased from $660 million to $750 million. A larger borrowing base provides additional capacity under the facility, which the partnership can use to fund acquisitions or other needs, though the release does not state a planned draw.

The breadth of the partnership's interests, which span 28 states, spreads its exposure across many operators and basins rather than concentrating it in a single producing area. The release does not list the basins that contributed most to the quarter's production.

Acquisition Strategy and Asset Base

The company describes itself as owning mineral and royalty interests in more than 137,000 gross wells across 28 states. Mineral and royalty interests generally do not carry the operating costs of drilling, which is one reason companies in the sector often pursue acquisitions as a means of growth.

The Drop Down acquisition added to the company's production base in the quarter and is reflected in the run-rate figure of 28,910 Boe per day. The release does not disclose the purchase multiple or the reserve base acquired, so the valuation of the transaction cannot be assessed from the document.

Subsequent reports will show whether the acquired production holds at the run-rate level and whether the expanded credit facility is used for further acquisitions, which would shape the partnership's production growth over the next several quarters.

Outlook

Kimbell Royalty's third-quarter report combines record production, a larger run-rate base after an acquisition, a $0.45 distribution and a higher credit facility borrowing base. Subsequent quarters will show whether the higher production base holds and whether additional acquisitions continue the company's growth pattern.