Financial Data and Key Metrics Changes - The fourth quarter of 2022 marked a record year for the company, with quarterly production setting a record on both an absolute and per unit basis for the third consecutive quarter [6] - The company reduced net debt by $100 million quarter-over-quarter and repurchased approximately 1 million units [7] - A distribution of $0.49 per unit is scheduled, which remains flat quarter-over-quarter despite a 10% decline in oil prices during the same period [10] Business Line Data and Key Metrics Changes - The company generated over $100 million in proceeds from non-core asset sales during 2022, including the sale of the Eagle Ford asset, which produced roughly 250 barrels of oil per day [9] - The company expects to deliver an 8% year-over-year growth in average production for 2023 without spending any capital [8] Market Data and Key Metrics Changes - The company is insulated from inflationary cost pressures due to its high-quality asset base and limited operating costs [11] - The company anticipates a nearly 10% annualized free cash flow yield at a $75 WTI price [11] Company Strategy and Development Direction - The company is focused on growing production without capital expenditures, emphasizing a disciplined capital allocation approach [7][11] - The strategy includes transitioning to 100% Permian assets for higher growth potential, as indicated by the sale of the Eagle Ford asset [17] Management's Comments on Operating Environment and Future Outlook - Management noted that the production growth is expected to pick up in the second half of 2023, driven by the timing of larger Diamondback pads coming online [20][21] - The management expressed confidence in the mineral business's ability to grow despite slower growth rates from parent companies in the basin [17] Other Important Information - The company is actively evaluating the market for potential acquisitions, although the bid-ask spread remains wide for mineral assets [24][25] - The company has not seen significant changes in operational cadence from third-party operators, maintaining steady activity levels [26] Q&A Session Summary Question: Thoughts on shareholder distribution and unit buybacks - Management indicated that unit buybacks are still considered a good use of capital, especially when compared to lower-quality assets available in the market [12][13] Question: Rationale behind the sale of Eagle Ford asset - The management explained that the Eagle Ford asset had limited growth potential compared to the Permian, making it a strategic decision to sell [15][17] Question: Guidance for 2023 and expected growth - Management confirmed that growth is expected to ramp up in the second half of 2023, with specific timing related to Diamondback's activity [19][20] Question: Bid-ask spread in the market - Management noted that the bid-ask spread for mineral assets remains wide, influenced by historical pricing perceptions among mineral owners [24][25] Question: Operational cadence from third-party operators - Management reported steady activity levels and visibility into net wells being turned to production, which is encouraging for future growth [26][27]

Financial Highlights - Viper's Q4 2022 cash available for distribution was $0.91 per unit, with $0.68 per unit returned to unitholders through a 75% commitment of total cash available for distribution[4] - The company ended Q4 2022 with net debt of $564 million, resulting in a net debt to last twelve months (LTM) EBITDA ratio of 0.7x[9] - Viper repurchased 1 million common units in Q4 2022 for $31.7 million, at an average price of $32.40 per unit[17] - The company's base distribution of $0.25 per unit implies a 3.3% annualized yield, representing approximately 50% of estimated cash available for distribution assuming $50 WTI[14] - A variable distribution for Q4 2022 of $0.24 per unit was declared, resulting in a total base-plus-variable distribution of $0.49 per unit, implying a 6.5% annualized yield[16] Production and Reserves - Average production for Q4 2022 was 19,978 barrels of oil per day (Bo/d) or 34,935 barrels of oil equivalent per day (Boe/d), representing a 1% increase from Q3 2022 and a 9% year-over-year increase[5] - The company's FY 2023 average production guidance is 20,000 – 22,000 Bo/d (34,500 – 38,000 Boe/d), implying 8% year-over-year growth at the midpoint[11] - Proved reserves at year-end 2022 were 148.9 million barrels of oil equivalent (MMBoe), with 79 million barrels of oil (MMBo), representing a 16% increase over year-end 2021 reserves[23] - Net proved reserve additions of 33.3 MMBoe resulted in a reserve replacement ratio of 271%, with an organic reserve replacement ratio of 280%[23] Asset and Development - Viper has 26,315 net royalty acres located entirely in the Permian Basin, with 44 rigs currently operating on its acreage[18] - There are 272 total gross (4.6 net 100% royalty interest) horizontal wells turned to production during Q4 2022, with an average lateral length of 10,630 feet[8] - The company has 477 gross (10.3 net 100% royalty interest) horizontal wells in the process of active development and an additional 501 gross (13.7 net 100% royalty interest) horizontal wells with line-of-sight to future development[13]

[Glossary of Oil and Natural Gas Terms](index=3&type=section&id=Glossary%20of%20Oil%20and%20Natural%20Gas%20Terms) [Glossary of Certain Other Terms](index=4&type=section&id=Glossary%20of%20Certain%20Other%20Terms) [Cautionary Statement Regarding Forward-Looking Statements](index=5&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) [PART I. FINANCIAL INFORMATION](index=7&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements and detailed notes for the periods ended September 30, 2022 [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet reflects a slight decrease in total assets, a reduction in long-term debt, and an increase in total equity Condensed Consolidated Balance Sheets | Metric | Sep 30, 2022 (In thousands) | Dec 31, 2021 (In thousands) | | :------------------------------------------ | :-------------------------- | :-------------------------- | | Cash and cash equivalents | $11,616 | $39,448 | | Royalty income receivable (net) | $94,215 | $68,568 | | Property, net | $2,810,671 | $2,920,115 | | Long-term debt, net | $669,638 | $776,727 | | Total assets | $2,985,757 | $3,034,021 | | Total equity | $2,290,913 | $2,232,828 | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statements of operations show substantial year-over-year growth in royalty income and net income driven by favorable commodity prices Condensed Consolidated Statements of Operations | Metric | 3 Months Ended Sep 30, 2022 (In thousands) | 3 Months Ended Sep 30, 2021 (In thousands) | 9 Months Ended Sep 30, 2022 (In thousands) | 9 Months Ended Sep 30, 2021 (In thousands) | | :------------------------------------------ | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Royalty income | $219,909 | $127,649 | $651,828 | $337,619 | | Total operating income | $221,617 | $128,004 | $662,842 | $339,130 | | Net income (loss) | $210,102 | $73,445 | $509,763 | $139,682 | | Net income (loss) attributable to Viper Energy Partners LP | $79,340 | $16,832 | $129,967 | $18,474 | | Basic EPS | $1.06 | $0.26 | $1.70 | $0.28 | [Condensed Consolidated Statements of Changes to Unitholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20to%20Unitholders'%20Equity) This statement details movements in unitholders' equity, reflecting an increase influenced by net income and common unit repurchases Condensed Consolidated Statements of Changes to Unitholders' Equity | Metric | Dec 31, 2021 (In thousands) | Sep 30, 2022 (In thousands) | | :-------------------------------- | :-------------------------- | :-------------------------- | | Total equity | $2,232,828 | $2,290,913 | | Common units outstanding | 78,546 | 74,156 | | Repurchased units (9 months ended Sep 30, 2022) | N/A | $(118,932) | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow statements indicate strong growth in operating cash flow, alongside significant cash used for financing activities Condensed Consolidated Statements of Cash Flows | Cash Flow Activity | 9 Months Ended Sep 30, 2022 (In thousands) | 9 Months Ended Sep 30, 2021 (In thousands) | | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Net cash provided by operating activities | $513,241 | $199,672 | | Net cash provided by (used in) investing activities | $19,611 | $(6,728) | | Net cash provided by (used in) financing activities | $(560,684) | $(140,525) | | Net increase (decrease) in cash and cash equivalents | $(27,832) | $52,419 | [Condensed Notes to Consolidated Financial Statements](index=12&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) These notes provide essential context for the financial statements, covering accounting policies, acquisitions, debt, and other key details [Note 1. ORGANIZATION AND BASIS OF PRESENTATION](index=12&type=section&id=Note%201.%20ORGANIZATION%20AND%20BASIS%20OF%20PRESENTATION) - Viper Energy Partners LP is a publicly traded Delaware limited partnership focused on owning and acquiring mineral and royalty interests in oil and natural gas properties, primarily in the Permian Basin[28](index=28&type=chunk) - Diamondback Energy, Inc. beneficially owns approximately **55% of the Partnership's total limited partner units** outstanding and controls the General Partner[29](index=29&type=chunk) [Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=12&type=section&id=Note%202.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - Management's estimates and assumptions are particularly challenging in the oil and natural gas industry due to **volatility in prices**, influenced by factors such as COVID-19, the war in Ukraine, and OPEC actions[33](index=33&type=chunk)[34](index=34&type=chunk) - Accrued liabilities at September 30, 2022, totaled **$24,173k**, including interest payable ($9,694k), ad valorem taxes payable ($11,075k), and derivative instruments payable ($2,252k)[40](index=40&type=chunk) - No recent accounting pronouncements not yet adopted are expected to have a **material effect** on the Partnership[42](index=42&type=chunk) [Note 3. REVENUE FROM CONTRACTS WITH CUSTOMERS](index=14&type=section&id=Note%203.%20REVENUE%20FROM%20CONTRACTS%20WITH%20CUSTOMERS) - Royalty income is recognized when control of the product is transferred to the purchaser, based on the Partnership's percentage ownership share of revenue, net of deductions[43](index=43&type=chunk) Royalty Income by Product Type (In thousands) | Product Type | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Oil income | $167,934 | $100,154 | $514,180 | $272,450 | | Natural gas income | $28,638 | $12,074 | $67,621 | $30,651 | | Natural gas liquids income | $23,337 | $15,421 | $70,027 | $34,518 | | Total royalty income | $219,909 | $127,649 | $651,828 | $337,619 | [Note 4. ACQUISITIONS AND DIVESTITURES](index=15&type=section&id=Note%204.%20ACQUISITIONS%20AND%20DIVESTITURES) - In Q3 2022, the Partnership acquired **165 net royalty acres** in the Permian Basin for approximately **$40.1 million**[45](index=45&type=chunk) - In Q3 2022, the Partnership divested **93 net royalty acres** in the Delaware Basin for an aggregate sales price of **$29.9 million**[46](index=46&type=chunk) - The 2021 Swallowtail Acquisition involved acquiring **2,313 net royalty acres**, primarily in the Northern Midland Basin, for approximately 15.25 million common units and $225.3 million in cash[47](index=47&type=chunk) [Note 5. OIL AND NATURAL GAS INTERESTS](index=16&type=section&id=Note%205.%20OIL%20AND%20NATURAL%20GAS%20INTERESTS) - **No impairment expense** was recorded on the Partnership's oil and natural gas interests for the three and nine months ended September 30, 2022 and 2021, based on quarterly ceiling tests[51](index=51&type=chunk) Oil and Natural Gas Interests (In thousands) | Category | Sep 30, 2022 | Dec 31, 2021 | | :-------------------------------- | :----------- | :----------- | | Oil and natural gas interests, gross | $3,493,979 | $3,513,590 | | Accumulated depletion and impairment | $(688,996) | $(599,163) | | Oil and natural gas interests, net | $2,804,983 | $2,914,427 | | Total net royalty acres | 26,789 | 27,027 | [Note 6. DEBT](index=16&type=section&id=Note%206.%20DEBT) - During the nine months ended September 30, 2022, the Partnership repurchased **$49.6 million principal amount** of outstanding Notes for **$49.0 million cash**[53](index=53&type=chunk) - As of September 30, 2022, the Operating Company had **$245.0 million outstanding borrowings** and **$255.0 million available** under its $500.0 million revolving credit facility[54](index=54&type=chunk)[56](index=56&type=chunk) Long-term Debt (In thousands) | Debt Type | Sep 30, 2022 | Dec 31, 2021 | | :-------------------------------- | :----------- | :----------- | | 5.375% senior unsecured notes due 2027 | $430,350 | $479,938 | | Revolving credit facility | $245,000 | $304,000 | | Total long-term debt | $669,638 | $776,727 | [Note 7. UNITHOLDERS' EQUITY AND DISTRIBUTIONS](index=17&type=section&id=Note%207.%20UNITHOLDERS'%20EQUITY%20AND%20DISTRIBUTIONS) - As of September 30, 2022, Diamondback beneficially owned approximately **55% of the Partnership's total limited partner units** outstanding[57](index=57&type=chunk) - The common unit repurchase program was approved to acquire up to **$750.0 million** of outstanding common units, with **$561.0 million remaining available** as of September 30, 2022[58](index=58&type=chunk) - A new distribution policy, effective Q3 2022, consists of a **base and variable distribution**, taking into account capital returned via the unit buyback program, and excludes one-time lease bonus payments from available cash calculation[59](index=59&type=chunk) [Note 8. EARNINGS PER COMMON UNIT](index=18&type=section&id=Note%208.%20EARNINGS%20PER%20COMMON%20UNIT) Earnings Per Common Unit (In thousands, except per unit amounts) | Metric | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) attributable to the period | $79,340 | $16,832 | $129,967 | $18,474 | | Net income (loss) per common unit, basic | $1.06 | $0.26 | $1.70 | $0.28 | | Net income (loss) per common unit, diluted | $1.06 | $0.26 | $1.70 | $0.28 | [Note 9. INCOME TAXES](index=19&type=section&id=Note%209.%20INCOME%20TAXES) - The Partnership recognized a discrete income tax benefit of **$49.7 million in Q3 2022** due to a partial release of its valuation allowance on deferred tax assets, driven by recent cumulative income and expected future taxable income[69](index=69&type=chunk) - As of September 30, 2022, the Partnership had a deferred tax asset of **$152.7 million** offset by an allowance of **$103.0 million**[69](index=69&type=chunk) Provision for (Benefit from) Income Taxes (In thousands, except for tax rate) | Metric | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Provision for (benefit from) income taxes | $(46,409) | $906 | $(37,597) | $941 | | Effective tax rate | (28.4)% | 1.2% | (8.0)% | 0.7% | [Note 10. DERIVATIVES](index=20&type=section&id=Note%2010.%20DERIVATIVES) - The Partnership uses fixed price swap contracts, fixed price basis swap contracts, and costless collars to **reduce price volatility** associated with royalty income[74](index=74&type=chunk) - As of September 30, 2022, the Partnership had **costless collars, put options, and basis swaps** outstanding for oil and natural gas[74](index=74&type=chunk)[81](index=81&type=chunk) Gains and Losses on Derivative Instruments (In thousands) | Metric | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Gain (loss) on derivative instruments | $882 | $(9,599) | $(19,366) | $(70,649) | | Net cash receipts (payments) on derivatives | $(10,263) | $(25,306) | $(27,292) | $(61,188) | [Note 11. FAIR VALUE MEASUREMENTS](index=21&type=section&id=Note%2011.%20FAIR%20VALUE%20MEASUREMENTS) - Derivative contracts are measured internally using **Level 2 inputs** (established commodity futures price strips, notional volumes, and time to maturity)[91](index=91&type=chunk) - The fair value of the revolving credit facility approximates its carrying value (Level 2), while the fair value of the 5.375% senior notes due 2027 is determined using **quoted market prices (Level 1)**[97](index=97&type=chunk) Net Fair Value of Derivative Instruments (In thousands) | Category | Sep 30, 2022 | Dec 31, 2021 | | :-------------------------------- | :----------- | :----------- | | Current Derivative assets | $4,686 | $0 | | Non-current Derivative assets | $839 | $0 | | Current Derivative liabilities | $891 | $3,417 | | Non-current Derivative liabilities | $125 | $0 | [Note 12. COMMITMENTS AND CONTINGENCIES](index=23&type=section&id=Note%2012.%20COMMITMENTS%20AND%20CONTINGENCIES) - Management believes that none of the pending legal proceedings, disputes, or claims will have a **material adverse effect** on the Partnership's financial condition, results of operations, or cash flows[100](index=100&type=chunk) [Note 13. SUBSEQUENT EVENTS](index=24&type=section&id=Note%2013.%20SUBSEQUENT%20EVENTS) - On November 3, 2022, a cash distribution for Q3 2022 of **$0.49 per common unit** was approved, consisting of a $0.25 base and a $0.24 variable distribution[102](index=102&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on financial condition, operational performance, commodity prices, and liquidity strategies [Overview](index=25&type=section&id=Overview) - Viper Energy Partners LP is a publicly traded Delaware limited partnership focused on owning and acquiring mineral and royalty interests in oil and natural gas properties, primarily in the Permian Basin[105](index=105&type=chunk) - The Partnership operates in one reportable segment and has been treated as a corporation for U.S. federal income tax purposes since May 10, 2018[105](index=105&type=chunk) [Recent Developments](index=25&type=section&id=Recent%20Developments) - Commodity prices for oil, natural gas, and natural gas liquids remain **highly volatile** due to global economic activity, geopolitical events (e.g., war in Ukraine), and OPEC+ actions[106](index=106&type=chunk) - **No impairment** was recorded on proved oil and natural gas interests for Q3 2022, despite average oil price decreases, due to favorable industry conditions[107](index=107&type=chunk) - In Q3 2022, the Partnership acquired **165 net royalty acres for $40.1 million** and divested **93 net royalty acres for $29.9 million**, bringing total net royalty acres to 26,789[108](index=108&type=chunk) - A new distribution policy, effective Q3 2022, includes a **base and variable distribution**, excluding one-time lease bonus payments from available cash calculation[109](index=109&type=chunk) - Third-party operated net wells turned to production in Q3 2022 reached their **highest level since Q2 2019**, with Diamondback-operated full-year 2023 oil production expected to increase by approximately 10% compared to 2022[110](index=110&type=chunk) Gross Well Information (Q3 2022 and as of Oct 20, 2022) | Metric | Diamondback Operated | Third Party Operated | Total | | :------------------------------------------ | :------------------- | :------------------- | :---- | | Horizontal wells turned to production (Q3 2022) | 52 | 221 | 273 | | Horizontal producing well count (as of Oct 20, 2022) | 1,504 | 4,838 | 6,342 | | Horizontal active development well count (as of Oct 20, 2022) | 95 | 475 | 570 | | Line of sight wells (as of Oct 20, 2022) | 166 | 354 | 520 | [Comparison of the Three Months Ended September 30, 2022 and June 30, 2022](index=27&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20September%2030%2C%202022%20and%20June%2030%2C%202022) - Total operating income decreased from **$239,322k in Q2 2022 to $221,617k in Q3 2022**[115](index=115&type=chunk) - Royalty income decreased by **$18.9 million QoQ**, primarily due to lower average oil and natural gas liquids prices, partially offset by a **4% increase in production volumes**[119](index=119&type=chunk) - Depletion expense decreased by **$1.5 million (5%)** due to a reduction in the average depletion rate, influenced by higher SEC oil and natural gas prices in reserve calculations[121](index=121&type=chunk) - A gain of **$882k on derivative instruments** was recorded in Q3 2022, compared to a loss of $1,889k in Q2 2022, as market prices decreased below strike prices on open contracts[122](index=122&type=chunk)[123](index=123&type=chunk) - Income tax expense decreased by **$52.6 million QoQ**, primarily due to a partial reduction of the valuation allowance against deferred tax assets and lower pre-tax net income[124](index=124&type=chunk) Production Data (QoQ) | Metric | Q3 2022 | Q2 2022 | Change | | :-------------------------- | :------ | :------ | :----- | | Oil (MBbls) | 1,828 | 1,798 | +30 | | Natural gas (MMcf) | 4,086 | 3,898 | +188 | | Natural gas liquids (MBbls) | 664 | 607 | +57 | | Combined volumes (MBOE) | 3,173 | 3,054 | +119 | | Average daily combined volumes (BOE/d) | 34,489 | 33,560 | +929 | Average Sales Prices (QoQ) | Metric | Q3 2022 | Q2 2022 | Change | | :---------------------- | :------ | :------ | :----- | | Oil ($/Bbl) | $91.87 | $106.34 | -$14.47 | | Natural gas ($/Mcf) | $7.01 | $6.10 | +$0.91 | | Natural gas liquids ($/Bbl) | $35.15 | $39.28 | -$4.13 | | Combined ($/BOE) | $69.31 | $78.20 | -$8.89 | [Comparison of the Nine Months Ended September 30, 2022 and 2021](index=30&type=section&id=Comparison%20of%20the%20Nine%20Months%20Ended%20September%2030%2C%202022%20and%202021) - Total operating income increased from **$339,130k in 9M 2021 to $662,842k in 9M 2022**[125](index=125&type=chunk) - Royalty income increased by **$314.2 million YoY**, with $240.9 million attributed to strong commodity prices and $73.3 million to a **23% increase in production volumes**, largely from the Swallowtail Acquisition[129](index=129&type=chunk)[130](index=130&type=chunk) - Lease bonus income increased significantly due to leasing assets acquired in the Swallowtail Acquisition to Diamondback in Q1 2022[131](index=131&type=chunk) - Depletion expense increased by **$15.6 million (21%)** due to production growth, despite a decrease in the average depletion rate from higher SEC oil and natural gas prices[133](index=133&type=chunk) - Net interest expense increased by **$6.0 million** due to higher average outstanding borrowings and interest rates on the revolving credit facility[136](index=136&type=chunk) - A **$37.6 million income tax benefit** in 9M 2022 resulted from a partial reduction in the valuation allowance against deferred tax assets, partially offset by increased current tax expense[137](index=137&type=chunk) Production Data (YoY) | Metric | 9M 2022 | 9M 2021 | Change | | :-------------------------- | :------ | :------ | :----- | | Oil (MBbls) | 5,259 | 4,378 | +881 | | Natural gas (MMcf) | 11,713 | 9,828 | +1,885 | | Natural gas liquids (MBbls) | 1,857 | 1,359 | +498 | | Combined volumes (MBOE) | 9,068 | 7,375 | +1,693 | | Average daily combined volumes (BOE/d) | 33,216 | 27,015 | +6,201 | Average Sales Prices (YoY) | Metric | 9M 2022 | 9M 2021 | Change | | :---------------------- | :------ | :------ | :----- | | Oil ($/Bbl) | $97.77 | $62.23 | +$35.54 | | Natural gas ($/Mcf) | $5.77 | $3.12 | +$2.65 | | Natural gas liquids ($/Bbl) | $37.71 | $25.40 | +$12.31 | | Combined ($/BOE) | $71.88 | $45.78 | +$26.10 | [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) - As of September 30, 2022, the Partnership had **$266.6 million in liquidity**, comprising $11.6 million in cash and cash equivalents and $255.0 million available under the Operating Company's credit agreement[138](index=138&type=chunk) - Primary sources of liquidity include cash flows from operations, asset sales, equity and debt offerings, and borrowings under the credit agreement[138](index=138&type=chunk) - Primary uses of cash are distributions to unitholders, debt repayments, capital expenditures for mineral and royalty interests, and common unit repurchases[138](index=138&type=chunk) - **Net cash provided by operating activities significantly increased** during the nine months ended September 30, 2022, driven by higher royalty and lease bonus income and decreased derivative settlements[144](index=144&type=chunk) - Net cash provided by investing activities in 9M 2022 (**$19,611k**) was primarily from divestitures, a shift from net cash used in 9M 2021 ($(6,728)k) which was mainly for acquisitions[145](index=145&type=chunk) - Net cash used in financing activities increased in 9M 2022 (**$560,684k**) due to $333.7 million in distributions, $118.9 million in common unit repurchases, and $49.0 million in senior note repurchases[146](index=146&type=chunk) [Capital Requirements](index=35&type=section&id=Capital%20Requirements) - The common unit repurchase program authorization was increased to **$750.0 million** on July 26, 2022, with **$561.0 million remaining available** as of September 30, 2022[151](index=151&type=chunk) - A cash distribution of **$0.49 per common unit** for Q3 2022 was approved, comprising a $0.25 base and a $0.24 variable dividend[152](index=152&type=chunk) [Critical Accounting Estimates](index=35&type=section&id=Critical%20Accounting%20Estimates) - There have been **no changes** to critical accounting estimates from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021[154](index=154&type=chunk) [Recent Accounting Pronouncements](index=35&type=section&id=Recent%20Accounting%20Pronouncements) - No recent accounting pronouncements not yet adopted are expected to have a **material effect** on the Partnership[155](index=155&type=chunk)[42](index=42&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section outlines the company's exposure to commodity price and interest rate risks and details the strategies used to manage them [Commodity Price Risk](index=35&type=section&id=Commodity%20Price%20Risk) - The Partnership's major market risk exposure is to the **volatile pricing of oil and natural gas** production, influenced by global economic and geopolitical factors[157](index=157&type=chunk)[158](index=158&type=chunk) - The Partnership uses fixed price swap contracts, fixed price basis swap contracts, and costless collars with put and call options to **reduce price volatility**[159](index=159&type=chunk) - As of September 30, 2022, a **10% increase in forward curves** would increase the net asset derivative position by $0.6 million to $5.1 million, while a **10% decrease** would reduce it by $0.3 million to $4.2 million[160](index=160&type=chunk) [Credit Risk](index=36&type=section&id=Credit%20Risk) - The Partnership is exposed to credit risk due to the **concentration of royalty income and receivables** with a limited number of significant purchasers and producers, without requiring collateral[161](index=161&type=chunk) [Interest Rate Risk](index=36&type=section&id=Interest%20Rate%20Risk) - The Partnership is subject to market risk from changes in interest rates on its indebtedness under the Operating Company's revolving credit facility, which carries a **floating rate**[162](index=162&type=chunk) - The weighted average interest rate on the revolving credit facility was **4.75%** for the three months and **3.53%** for the nine months ended September 30, 2022[162](index=162&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective and reported no material changes in internal control - The Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were **effective** as of September 30, 2022[164](index=164&type=chunk) - There were **no material changes** in internal control over financial reporting during the quarter ended September 30, 2022[165](index=165&type=chunk) [PART II. OTHER INFORMATION](index=38&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) Management assesses that pending legal proceedings will not have a material adverse effect on the company's financial condition - The Partnership is involved in routine litigation, disputes, and claims arising in the ordinary course of business[167](index=167&type=chunk) - Management believes that none of the pending matters, if decided adversely, will have a **material adverse effect** on the Partnership's financial condition, results of operations, or cash flows[167](index=167&type=chunk) [Item 1A. Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) This section states that no material changes have occurred to the risk factors previously disclosed in the Annual Report on Form 10-K - The business faces many risks, as discussed in the Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent Quarterly Reports on Form 10-Q[168](index=168&type=chunk)[169](index=169&type=chunk) - There have been **no material changes** in the Partnership's risk factors from those previously described[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details common unit repurchase activity for the quarter and confirms no unregistered sales of equity securities occurred - There were **no unregistered sales of equity securities** during the period[170](index=170&type=chunk) - On July 26, 2022, the common unit repurchase program authorization was increased from $250.0 million to **$750.0 million**[173](index=173&type=chunk) Common Unit Repurchase Activity (Three Months Ended September 30, 2022) | Period | Total Number of Units Purchased | Average Price Paid Per Unit | Approximate Dollar Value of Units that May Yet Be Purchased Under the Plan (In thousands) | | :-------------------------------- | :---------------------------- | :-------------------------- | :------------------------------------------------------------------------------------ | | July 1, 2022 - July 31, 2022 | 760,000 | $26.51 | $591,618 | | August 1, 2022 - August 31, 2022 | 529,972 | $29.37 | $576,050 | | September 1, 2022 - September 30, 2022 | 527,745 | $28.44 | $561,043 | | Total | 1,817,717 | $27.91 | | [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section provides a comprehensive list of all exhibits filed with the Form 10-Q, including agreements and certifications - Exhibits include the Purchase and Sale Agreement, Certificate of Limited Partnership, Amended and Restated Agreement of Limited Partnership, and various amendments[174](index=174&type=chunk) - Certifications of the Chief Executive Officer and Chief Financial Officer (Exhibits 31.1, 31.2, 32.1) are filed herewith[174](index=174&type=chunk)[175](index=175&type=chunk) - The financial information from the Quarterly Report is formatted in **Inline XBRL** as Exhibit 101[174](index=174&type=chunk) [Signatures](index=40&type=section&id=Signatures) This section contains the official signatures of the Chief Executive Officer and Chief Financial Officer, certifying the Form 10-Q report - The report was duly signed on November 8, 2022, by Travis D. Stice, Chief Executive Officer, and Teresa L. Dick, Chief Financial Officer, on behalf of Viper Energy Partners GP LLC, its General Partner[178](index=178&type=chunk)[179](index=179&type=chunk)

Viper Energy Partners LP (NASDAQ:VNOM) Q3 2022 Earnings Conference Call November 8, 2022 11:00 AM ET Company Participants Adam Lawlis - Vice President, Investor Relations Travis Stice - Chief Executive Officer Kaes Van't Hof - President Austen Gilfillian - Vice President, Investor Relations Conference Call Participants Neal Dingmann - Truist Securities Tim Rezvan - KeyBanc Capital Markets Leo Mariani - MKM Partners Operator Good day and thank you for standing by. Welcome to the Viper Energy Partners Third Q ...

Investor Presentation November 2022 Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, including statements regarding Viper's: future performance; business strategy; future operations; estimates and projections of operating income, losses, costs and expenses, returns, cash fl ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-36505 Viper Energy Partners LP (Exact Name of Registrant As Specified in Its Charter) DE 46-5001985 (I.R.S. Employer Identification Number) (State or Other Jurisdiction of Incorp ...

Viper Energy Partners LP (NASDAQ:VNOM) Q2 2022 Earnings Conference Call August 2, 2022 12:00 PM ET Company Participants Adam Lawlis - Vice President of Investor Relations Travis Stice - Chief Executive Officer Kaes Van't Hof - President Austen Gilfillian - Investor Relations Conference Call Participants Neal Dingmann - Truist Chris Baker - Credit Suisse Jeanine Wai - Barclays Leo Mariani - MKM Partners Operator Good day and welcome to the Viper Energy Partners 2022 Earnings Call. At this time, all particip ...

[PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=8&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) Viper Energy Partners LP's unaudited Q1 2022 condensed consolidated financial statements highlight increased revenue and net income from higher commodity prices [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets slightly decreased to **$3.001 billion** as of March 31, 2022, with liabilities decreasing and equity modestly increasing Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $136,702 | $111,149 | | **Property, net** | $2,860,747 | $2,920,115 | | **Total Assets** | **$3,001,085** | **$3,034,021** | | **Total Current Liabilities** | $37,104 | $24,466 | | **Long-term debt, net** | $721,005 | $776,727 | | **Total Liabilities** | **$758,109** | **$801,193** | | **Total Equity** | **$2,242,976** | **$2,232,828** | [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income surged to **$128.0 million** in Q1 2022, primarily due to royalty income more than doubling to **$193.1 million** amid strong commodity prices Condensed Consolidated Statements of Operations (in thousands, except per unit amounts) | Account | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Royalty income | $193,089 | $96,512 | | Total operating income | $201,903 | $96,976 | | Income from operations | $158,669 | $63,220 | | **Net income (loss)** | **$128,041** | **$23,859** | | Net income (loss) attributable to Viper Energy Partners LP | $16,605 | $(3,020) | | **Diluted EPS** | **$0.22** | **$(0.05)** | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities surged to **$135.8 million** in Q1 2022, while financing activities used **$174.2 million** for debt repayment and distributions Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Category | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $135,838 | $54,659 | | Net cash provided by (used in) investing activities | $31,957 | $(74) | | Net cash provided by (used in) financing activities | $(174,177) | $(61,979) | | **Net decrease in cash and cash equivalents** | **$(6,382)** | **$(7,394)** | [Condensed Notes to Consolidated Financial Statements](index=12&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, revenue, acquisitions, debt, and equity, highlighting a **$29.3 million** divestiture and **$39.3 million** unit repurchase Royalty Income by Product (in thousands) | Product | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Oil income | $155,051 | $78,344 | | Natural gas income | $15,190 | $9,044 | | Natural gas liquids income | $22,848 | $9,124 | | **Total royalty income** | **$193,089** | **$96,512** | - In Q1 2022, the Partnership divested 325 net royalty acres in the Midland Basin for an aggregate sales price of **$29.3 million**[43](index=43&type=chunk) - During Q1 2022, the Partnership repurchased approximately **$39.3 million** of common units, with **$40.7 million** remaining available under the program, which was subsequently increased to **$250.0 million** on April 27, 2022[54](index=54&type=chunk)[97](index=97&type=chunk) - Subsequent to quarter end, on April 27, 2022, the board approved a cash distribution of **$0.67 per common unit** for Q1 2022[96](index=96&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2022's improved financial results, driven by strong commodity prices and record operational activity, detailing liquidity and capital allocation [Recent Developments and Operational Update](index=23&type=section&id=Recent%20Developments%20and%20Operational%20Update) Q1 2022 performance was significantly influenced by high commodity prices, with record third-party well activity and a **$29.3 million** divestiture of royalty acres - Commodity prices were highly volatile in Q1 2022, with NYMEX WTI ranging from **$47.62 to $123.70 per Bbl**, influenced by the Russian-Ukrainian military conflict and the COVID-19 pandemic[102](index=102&type=chunk) Operational Well Information (Q1 2022) | Metric | Diamondback Operated | Third Party Operated | Total | | :--- | :--- | :--- | :--- | | **Horizontal wells turned to production (Q1 2022)** | | | | | Gross wells | 45 | 230 | 275 | | Net 100% royalty interest wells | 2.0 | 1.9 | 3.9 | | **Horizontal producing well count (as of Apr 13, 2022)** | | | | | Gross wells | 1,384 | 4,357 | 5,741 | | **Horizontal active development well count (as of Apr 13, 2022)** | | | | | Gross wells | 91 | 382 | 473 | [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Royalty income increased significantly year-over-year and quarter-over-quarter, driven by a **65%** rise in average combined sales price and a **21%** increase in production volumes Production and Pricing Comparison (Q1 2022 vs. Q1 2021) | Metric | Q1 2022 | Q1 2021 | % Change | | :--- | :--- | :--- | :--- | | **Production** | | | | | Average daily combined volumes (BOE/d) | 31,567 | 26,066 | +21.1% | | **Average Sales Prices** | | | | | Oil ($/Bbl) | $94.95 | $56.16 | +69.1% | | Combined ($/BOE) | $67.97 | $41.14 | +65.2% | Production and Pricing Comparison (Q1 2022 vs. Q4 2021) | Metric | Q1 2022 | Q4 2021 | % Change | | :--- | :--- | :--- | :--- | | **Production** | | | | | Average daily combined volumes (BOE/d) | 31,567 | 31,359 | +0.7% | | **Average Sales Prices** | | | | | Oil ($/Bbl) | $94.95 | $74.00 | +28.3% | | Combined ($/BOE) | $67.97 | $56.82 | +19.6% | [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2022, total liquidity was **$285.1 million**, with primary cash uses including distributions, debt repayment, and common unit repurchases - Total liquidity at March 31, 2022, was approximately **$285.1 million**, comprising **$33.1 million** in cash and **$252.0 million** available under the credit agreement[133](index=133&type=chunk) - Primary uses of cash included distributions to unitholders, debt repayment, acquisitions, and repurchases of common units and senior notes[133](index=133&type=chunk) - During Q1 2022, the company made net repayments of **$56.0 million** on its revolving credit facility, paid **$78.9 million** in distributions, and repurchased **$39.3 million** of common units[141](index=141&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risks include commodity price volatility, credit risk, and interest rate risk, mitigated by derivative contracts for price fluctuations - The company's major market risk exposure is oil and natural gas pricing, mitigated using derivative instruments like fixed price swaps and costless collars to reduce volatility[151](index=151&type=chunk)[152](index=152&type=chunk) - As of March 31, 2022, the company had a net derivative liability of **$11.5 million**, which would increase by **$4.8 million** with a hypothetical **10%** increase in forward commodity prices[153](index=153&type=chunk) - The company is subject to interest rate risk on its revolving credit facility, which bears interest at a floating rate based on LIBOR or an alternative base rate[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting - Based on an evaluation as of March 31, 2022, the CEO and CFO concluded that the company's disclosure controls and procedures are effective[158](index=158&type=chunk) - No material changes occurred during Q1 2022 that affected internal controls over financial reporting[159](index=159&type=chunk) [PART II. OTHER INFORMATION](index=35&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine litigation, but management does not expect any pending matters to materially affect its financial condition or operations - The company is involved in routine litigation, but management does not expect any pending proceedings to have a material adverse effect on its financial condition or results of operations[162](index=162&type=chunk) [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor addresses the unpredictable impact of the Russia-Ukraine conflict on the global economy and energy markets, potentially affecting the company's business - A new risk factor was added regarding the unpredictable impact of the military conflict between Russia and Ukraine on the global economy, energy markets, and the company's business[165](index=165&type=chunk) - No other material changes have been made to the risk factors described in the Annual Report on Form 10-K for the year ended December 31, 2021[164](index=164&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2022, the company repurchased **1,580,200** common units for **$39.3 million**, with the repurchase program authorization subsequently increased to **$250.0 million** Issuer Repurchases of Equity Securities (Q1 2022) | Period | Total Number of Units Purchased | Average Price Paid Per Unit | Approximate Dollar Value of Units that May Yet Be Purchased Under the Plan (as of 3/31/22) | | :--- | :--- | :--- | :--- | | Jan 1 - Jan 31, 2022 | 1,580,200 | $24.85 | $40,715,000 | | Feb 1 - Feb 28, 2022 | — | $— | $40,715,000 | | Mar 1 - Mar 31, 2022 | — | $— | $40,715,000 | | **Total** | **1,580,200** | **$24.85** | | - On April 27, 2022, the board of directors increased the authorization of the common unit repurchase program from **$150.0 million** to **$250.0 million**[169](index=169&type=chunk) [Item 6. Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Quarterly Report on Form 10-Q, including required CEO and CFO certifications and Inline XBRL financial data - The report includes a list of filed exhibits, such as various agreements and required CEO and CFO certifications pursuant to the Securities Exchange Act of 1934[170](index=170&type=chunk)

Viper Energy Partners LP (NASDAQ:VNOM) Q1 2022 Results Conference Call May 3, 2022 12:00 PM ET Company Participants Adam Lawlis - VP, IR Travis Stice - CEO Kaes Van’t Hof - President Austen Gilfillian - IR Conference Call Participants Neal Dingmann - Truist Securities Chris Baker - Credit Suisse Derrick Whitfield - Stifel Jeanine Wai - Barclays Kyle May - Capital One Securities Leo Mariani - KeyBanc Operator Good day. Thank you for standing by, and welcome to the Viper Energy Partners First Quarter 2022 Ear ...

Investor Presentation May 2022 Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, including statements regarding Viper's: future performance; business strategy; future operations; estimates and projections of operating income, losses, costs and expenses, returns, cash flow, a ...