Dorchester Minerals(DMLP) - 2024 Q2 - Quarterly Report

Financial Performance - The Partnership announced a cash distribution of $0.702058 per common unit for Q2 2024, payable on August 8, 2024[27]. - Oil sales volumes from Royalty Properties increased by 11$26.1 million in Q2 2024, with average indicated prices of $70.48/bbl for oil and$1.53/mcf for natural gas[41]. - Net cash provided by operating activities decreased by 16% from the first six months of 2023 to the same period in 2024, attributed to lower NPI payment receipts[39]. Operating Costs and Expenses - Operating costs increased by 28% from Q2 2023 to Q2 2024, primarily due to higher oil and natural gas sales volumes[37]. - General and administrative expenses decreased by 6% from Q2 2023 to Q2 2024, mainly due to one-time expenses related to an unsuccessful acquisition[38]. Liquidity and Cash Flow - The Partnership's liquidity is primarily supported by cash flows from Royalty Properties and NPI, with distributions determined after all expenses are paid[43]. - Cash and cash equivalents totaled $35.2 million at June 30, 2024, down from$47.0 million at December 31, 2023, indicating a decrease of approximately 25.5%[49]. - The company expects sufficient liquidity to fund distributions to unitholders despite uncertainties from global military conflicts and inflation, which may impact cash flows[46]. Market and Economic Conditions - Future distributions to unitholders may be affected by economic conditions in the oil and natural gas market, including potential declines in oil prices[46]. - The current economic environment is described as volatile, with unpredictable long-term impacts on cash flows[46]. - The company is monitoring the impact of ongoing global military conflicts and COVID-19 variants on its operations and liquidity[46]. - There have been no significant changes in exposure to market risk during the three months ended June 30, 2024[51]. Lease Obligations - Total lease payments amount to $1.725 million, with total lease obligations standing at$1.175 million after accounting for interest[48]. - The total lease payments are scheduled to increase gradually from $178,000 in 2024 to$380,000 in 2028[48]. Partnership Agreements and Policies - The company has a partnership agreement that prohibits incurring indebtedness exceeding $50,000, excluding trade payables[45]. - The company has not reported significant changes to critical accounting policies and estimates since the last annual report[48]. Acquisitions - The Partnership acquired mineral interests totaling approximately 1,485 net royalty acres in Colorado for$17.0 million in common units on March 28, 2024[31].