Ladies and gentlemen, thank you for joining us, and welcome to the LandBridge Fourth Quarter 2025 Results Call. [Operator Instructions] I will now hand the conference over to Mae Harrington, Director of Investor Relations. Mae, please go ahead.

Good morning, and thank you for joining LandBridge's Fourth Quarter and Fiscal Year 2025 Earnings Call. I'm joined today by our Chief Executive Officer, Jason Long; and our Chief Financial Officer, Scott McNeely. Before we begin, I'd like to remind you that in this call and the related presentation, we will make forward-looking statements regarding our current beliefs, plans and expectations, which are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from results and events contemplated by such forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Please refer to the risk factors and other cautionary statements included in our filings with the SEC. I would also like to point out that our investor presentation and today's conference call will contain discussions of non-GAAP financial measures, which we believe are useful in evaluating our performance. The supplemental measures should not be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP. Reconciliations to the most directly comparable GAAP measures are included in our earnings release and the appendix of today's accompanying presentation. I'll now turn the call over to our CEO, Jason Long.

Thank you, Mae, and good morning, everyone. 2025 was a year of accretive expansion for LandBridge with Q4 marking our seventh consecutive quarter of revenue growth as a public company. While Scott will delve more deeply into our operational and financial results, I'll start by highlighting the proven growth potential of our business model. In 2025, we grew revenues by 81% and adjusted EBITDA by 83% year-over-year and achieved an adjusted EBITDA margin of 89%. Fourth quarter results strongly contributed to that growth with revenue and EBITDA increasing 12% and 14% quarter-over-quarter, respectively. We have many compelling organic growth opportunities before us as well as accretive opportunities to expand our footprint, which now totals more than 315,000 mostly contiguous acres strategically located across the Delaware Basin. We often talk about LandBridge advancing the paradigm of active land management, and I want to spend a few minutes talking about what that means and how we're able to demonstrate those results. We are focused on acquiring strategic high-quality land positions that are well positioned for development across key industries such as energy, power, digital infrastructure and broader industrial development. In parallel, we work to drive capital-light growth on existing acreage through commercial efforts by leveraging our deep expertise in the Delaware Basin across multiple industries to attract and advance commercial opportunities on our acreage, maximizing each acre's revenue potential and creating compounding revenue across our position. Our active land management strategy is delivering long-term value across diversified revenue streams and driving gains in surface use economic efficiency, or SUEE. This metric, which we disclose on an annual basis for acreage with similar acquisition vintages, represents the average revenue per acre generated by our acreage portfolio over time. For example, our legacy acreage position of approximately 72,000 acres generated less than $465 per…

Thank you, Jason, and good morning to everyone joining today. As Jason noted, we entered 2026 from a position of strength with the momentum of a strong fourth quarter and a full year of growth. In the fourth quarter, we delivered total revenue of $56.8 million, up 12% sequentially and 56% year-over-year. And for the year, we delivered revenue of $199.1 million, representing 81% year-over-year growth. Sequential growth for the fourth quarter was driven by surface use royalties and revenues which increased 12%, primarily driven by increased royalties from WaterBridge's BPX Kraken development as well as new project easement payments. Resource sales and royalties revenues also rose 12%, attributable to water and sand sales. This growth came in spite of a 6% quarterly decline in revenue from oil and gas royalties driven by lower activity levels on our acreage. Our direct exposure to commodity prices remains limited. For the full year, oil and gas royalties represented less than 10% of LandBridge's total revenues. Our advantaged margins are evident in our adjusted EBITDA of $51.1 million for the quarter, up 14% sequentially and 61% year-over-year, representing a 90% margin. For the full year, we delivered $177 million in adjusted EBITDA, above the upper end of our guidance range, reflecting an 83% sequential increase and a margin of 89%. We generated free cash flow of $36.4 million for the quarter, representing a 64% margin. For the full year, we generated free cash flow of $122 million, representing a 61% margin. In November, we further optimized our balance sheet through an inaugural $500 million senior notes offering accompanied by a new $275 million revolving credit agreement. These new agreements enhance our balance sheet strength by improving our cost of capital, increasing our liquidity, reducing our interest expense and overall providing a more scalable…

[Operator Instructions] Your first question comes from the line of Keith Beckmann of Pickering Energy Partners.

I just wanted to get a sense on what the moving pieces were that drove the really strong sequential growth in produced water and maybe how you expect that to trend looking forward based on some of the projects we expect to come online here over the next year?

Keith, I appreciate the question. Yes. So in the third quarter, we saw BPX Kraken bring -- WaterBridge bring the BPX Kraken project online and continue to see volumes ramp through the end of the year. So that was a major contributor as well as just increased activity on the East Stateline Ranch. So obviously, great momentum kind of stepping into '26. As we kind of look forward to 2026 and what is driving the increase in expectations for this year relative to '25, that's really going to be around both surface use royalties as well as other surface use revenues. As a reminder, WaterBridge's BPX Kraken project expects increased volumes through the course of the year. And additionally, the Speedway Pipeline comes online midyear, which will add a step change in volumes over the course of the summer. So great drivers there related to that WaterBridge activity. And then taking a step back, just kind of broader surface use expectations related primarily to oil and gas activity, really kind of serving as the 2 drivers in 2026 uptick in expectations.

That's very helpful. And then my second question just stems around. We saw the dividend increase and the buyback authorization, which were great. I think I noticed in the presentation, you guys are still prioritizing M&A as it comes. I just wanted to get a sense of kind of the current landscape of how deals are looking. Is it easier or harder to get things done right now in West Texas? And then maybe as sort of a follow-up to that, did you ever look at anything outside of West Texas that could potentially make sense?

Yes. We --the opportunity pipeline for M&A is still is incredibly robust. I mean, we're actively pursuing a number of opportunities of different sizes. So we have not really seen a slowdown in that environment whatsoever. I think we're incredibly well positioned to continue to grow through M&A, and that remains our top capital allocation priority here for 2026. As it relates to looking outside of the Delaware Basin, we absolutely look at everything that comes across our plate. I think if we step into another region, we want to be very thoughtful about that. But we are actively looking and exploring kind of creative ways to continue to grow the platform here and stepping out the Delaware Basin is obviously one of those ways.

Your next question comes from the line of John Annis from Texas Capital.

For my first one, regarding 2026 EBITDA guidance, are there 1 or 2 drivers in your assumptions that could lead you to the high end versus low end of your guide?

Yes. John, I appreciate the question. No, absolutely. I think when we thought through kind of putting together our guidance for the year, really wanted to be thoughtfully conservative around ultimately what was baked in there. And so I mentioned on Keith's question, the step change really resulting from both Speedway and BPX Kraken kind of growing through the course of the year. There are a number of other projects that WaterBridge has in the pipeline that continue -- could continue to grow, produce water volumes meaningfully above expectations. If we just stay in kind of this mid-60s and above commodity price environment, I think the activity levels driven by that will easily exceed the expectations kind of baked into the forecast. And so I wanted to be mindful of kind of the macro environment and the movement in that through the course of our budgeting cycle, but I would say there is substantial, call it, asymmetric upside in terms of opportunities for us to outperform, which is by design.

That makes sense. For my follow-up, the 2024 vintage acreage saw surface use economic efficiency grow from $204 an acre to $499 in 1 year, which is an impressive jump while the 42,000 acres acquired in 2025 sits at $208 an acre. Based on what you know about the commercial opportunities on that acreage today, do you think a similar trajectory is possible?

Look, absolutely. I mean, I think this is -- it's such a powerful metric because it really reflects the financial results of the active land management strategy as well as the opportunity set that exists coming off of the heavy M&A year. And so we saw obviously great growth from 2024 through 2025 on that vintage, as you kind of point out. When you think through the opportunity set for 2026 to outperform, I would point to 1918 Ranch that we just closed on in the fourth quarter. We have not baked in any kind of substantial uplift due to the commercialization of 1918 in that 2026 guidance. And so the opportunity set is there. We are kind of actively working through those efforts today. And that serves as a really obvious example of a potential upside driver relative to that baseline guidance that we provided. So the punchline is yes. We go out and we buy land that we think that we can commercialize quickly, and that is going to be a quick growth driver. And again, 1918 is a great example of one of those opportunities that we have in front of us for 2026.

Your next question comes from the line of Alexander Goldfarb from Piper Sandler.

Maybe just switching quickly to the data centers and power plants. When you guys IPO-ed versus now, it would seem like the political conversation has definitely sharpened on the power needs of data centers versus a few -- a year or 2 ago when you IPO-ed. As you look at the opportunity set to expand or add data centers and all that, is your view that the political process, the approval process and everything involved is just as you imagined at the IPO a little under 2 years ago? Or has the process become either more difficult or required more approvals? Just trying to understand how this may have changed now versus what you originally planned.

Alex, I appreciate the thoughtful question. I mean I think if you look at just the approval of the broader regulatory landscape, what we've really seen is the benefit of Texas', call it, more business-friendly regulatory environment. I mean as it relates to data centers, I want to say 2025 by orders of magnitude, saw more canceled data centers in other states than has ever been seen in history, and there's been a number of articles that have come out on challenges facing other states and proposed legislation to make future data centers that much more challenging because of this whole not in my backyard dynamic around the impact of power consumption and water consumption in major metropolitan areas. And so the more we see that getting out there, I think the more just kind of further reinforces just West Texas appeal as it relates to data centers. I mean it's easy to point to the fundamentals around water availability, power generation and so on, all of those things that really make West Texas such an attractive place for these folks to operate. The regulatory side doesn't get as much credit as it should because I mean, Texas is eager to find ways to bring data centers. And I would say it's just so much more receptive than what we're seeing kind of evolve in so many of these other states that have been more traditional footprints for data centers.

Okay. And then the second question is just sort of piggyback some of the others who have asked about the guidance and the EBITDA for '26. You guys talked about Speedway coming online. There's the WaterBridge contributions, the 1918 Ranch. How much -- if we think about sort of your 4Q run rate, how much additional revenue is factored into the EBITDA guidance, the $205 million to $225 million versus potentially upside to that? Just trying to -- because it seems like you guys have done a tremendous amount of activity and therefore, would have expected more EBITDA growth, but it may just be sort of timing of when these things come online or uncertainty. So just trying to understand how much of these additional items that you outlined are in the number versus not in the number and potentially upside to the range?

Yes, it's a good question. So we've baked in, I could call it, the majority of the impact coming from Speedway and BPX Kraken and both of those either Speedway comes online over the course of the summer and BPX Kraken is expected to increase in volumes over the summer. And then the one other component, obviously, 1918 closing in fourth quarter, we'd see the benefit of a full year of that contribution although I flagged earlier on Keith and John's questions that we're not really baking in much in the way of upside commercialization of that asset, which I think we would certainly expect and are actively actioning at the moment. And so when we think through just what else could happen, we've been conservative around, call it, new development expectations. We've been conservative on volumes, as I've mentioned, conservative on 1918 commercialization and have not baked in any of these other kind of in-process projects that we've kind of alluded to on this call. And so there is just an ample amount of commercial opportunity and opportunity sets that we're working through at the moment that aren't included there. And so as we continue to kind of notch those wins, we would expect to come back to the market and voice over what is driving, hopefully, to beat expectations and the increased guidance, but wanted to be mindful stepping into the year in terms of where we are offsetting our expectations initially. And as we continue to get those wins, we'll continue to message that to the Street.

[Operator Instructions] Your next question comes from John Mackay, of Goldman Sachs.

I just want to go back to the revenue per acre metrics because we agree they're a pretty important thing to watch. When you're talking -- when you're looking at the '24 and '25 acquisitions sitting at, I guess, $500 and $200 right now versus where the legacy ones are, is that $1,000 an acre kind of structurally possible for those '24 and '25 packages? And maybe not to push you on a time frame for that, but maybe again, just walk us through kind of structurally what the overall platform could look like over time, let's say, precluding larger items like data centers?

Yes. John, I appreciate the questions. Absolutely, $1,000 plus is very not just achievable, but I would say actionable in the near term. I mean, as a reminder, -- when we bought that legacy acreage, I know we speak to that $465 number being the jumping off point in 2022. But when we actually acquired that surface in 2021, it was meaningfully below $465. And that acreage is now sitting at $1,159 over the course of what has effectively been 4 years. We don't see any reason why that same trajectory isn't possible in the 2024 and 2025 acreage that we bought. We think the acreage itself and the opportunity set parallels that legacy acreage at a minimum, and we think that there's kind of incremental opportunities that we can continue to pursue kind of incremental to that. So -- no, look, we feel great about kind of that. Now where can this go in totality from here? We've spoken to kind of that $2,500 to $3,500 an acre range as a good, call it, medium- to long-term target. We still very much believe that, that is attainable over, call it, a 7- to 10-year time period. There's the expectation of just the continued compounding commercial activity that's baked into that. And so there are different ways we can go about achieving that $2,500 to $3,500 an acre. And to plug our upcoming Investor Day, I'll just wrap up by saying we plan on walking through a number of different ways and a number of different permutations in terms of the commercial bed down on our acreage that can ultimately get us there.

Your final question comes from the line of Charles Meade of Johnson Rice.

Apologies, I hopped on the call a little late. So if I ask something that has already been covered, my apologies in advance. But I'm curious, I really like this new SUEE metric, and I suspect it's something you guys have been talking about internally for a while, but it's great to get the view -- great that you're sharing that view with us. I'm curious, the -- how is your -- how has the competition changed for acquiring new assets? And I'm particularly thinking about it if you guys -- are other competitors able to drive or what differentiates you and your ability to drive more SUEE? And is that -- does that make you more competitive? Or is it -- is this the kind of thing that's alternatively attracting a lot of other capital to the space that maybe is competing away some opportunities?

Yes. Charles, I appreciate the thoughtful questions. I'll tackle it in 2 different pieces. I mean, first, as we think through the competitive landscape for acquisitions, there's obviously just an element of being called a victim of our own success where you do have more folks looking to see if this is a strategy that they can replicate. I would just -- I would point out to all of the advantages of our platform and kind of as part of the answer to the second question on why it's so tough for others to step in and be effective here. I mean, I think, first, every land position is unique and irreplicable. And you think through just the land positions that we're sitting on today, particularly along the Texas side of the Stateline, I mean, not just gives us an enormous advantage as we think through capturing oil and gas activity, particularly water, but serves as a fantastic platform to continue to scale that is near impossible to continue to replicate. And so just a great kind of moat in and of itself in that regard. But second, the partnership we have with our sister company, WaterBridge, is incredibly valuable. And it's not just a byproduct of call it WaterBridge bringing activity to LandBridge and exchange LandBridge serving as the floor space provider to WaterBridge. But the nature of having an operating team out there, boots on the ground just provides a kind of competitive intelligence that we can get day-to-day, macro update that we can get day-to-day on a very granular level, that would be impossible for a land-only company to be able to replicate there.

Yes. I mean the one thing I'd add to that is not only everything that Scott just mentioned there on the WaterBridge side, but also being able to really leverage the technical side of it, the geological and electrical engineering and really understanding where infrastructure is, where these opportunities exist, and a lot of that skill set is not there on a lot of these start-ups.

Yes, it's exactly right. And so ultimately, like having a sophisticated operation of scale kind of married with an operating company with that in-house technical expertise, just makes it very tough for a new entrant to come in even above and beyond that competitive mode we have from our existing asset base. And so look, we feel very good about continuing to affect both the commercial strategy that we have today as well as the acquisition strategy that we've effectively, I think, worked through to date, and we don't see that changing going forward.

There are no further questions at this time. I will now turn the call back to Scott McNeely for closing remarks.

Yes. Thank you, operator, and thanks for everyone joining us today. Again, very happy with the quarter, fantastic momentum stepping into 2026. We're incredibly excited about a myriad of opportunities we have to work through. And then my final plug, again, we look forward to outline just the broader strategy in a lot more detail in the upcoming Investor Day. So we hope to see you all there. Thank you again.

This concludes today's call. Thank you for attending. You may now disconnect.