Thomas L Carter; Chairman, CEO and President; Black Stone Minerals LP
Presentation
Operator
Hello, everyone. And thank you for joining us today for this Blackstone Minerals Q3, 2024 earnings conference call. (Operator instruction). I am pleased to turn the floor to Director of Finance, Mr. Mark Meaux. Please go ahead, sir.
Mark Meaux
Thank you, operator. Good morning to everyone. Thank you for joining us either by phone or online for Blackstone Minerals third quarter, 2024 earnings conference call. Today's call is being recorded and will be available on our website along with the earnings release which was issued last night. Before we start I'd like to advise you that we will be making forward-looking statements during this call about our plans, expectations and assumptions regarding our future performance. These statements involve risks that may cause our actual results to differ materially from the results expressed or implied in our forward-looking statements. For a discussion of these risks. You should refer to the cautionary information about forward-looking statements in our press release from yesterday and the risk factors section of our 2023, we may refer to certain non-GAAP financial measures that we believe are useful in evaluating our performance, reconciliation of those measures to the most directly comparable GAAP measure. And other information about these nonGAAP metrics are described in our earnings press release from yesterday, which can be found on our website at www.Blackstoneminerals.com. Joining me on the call from the company are Tom Carter, Chairman, CEO and President; Taylor DeWalch, Senior Vice President, Chief Financial Officer and Treasurer; Carrie Clark, Senior Vice President, Chief Commercial Officer; and Steve Putman, Senior Vice President and General Counsel. I'll now turn the call over to Tom.
Thomas L Carter
Thanks, Mark, good morning and thanks for joining us today. We had a successful third quarter and as previously announced, maintained our consistent distribution despite a decrease in production from last quarter driven by volatility in the natural gas area throughout the year. During the quarter, we progressed our minimal acquisition program and we continue working with our partners for long term development. We remain confident in the outlook across our acreage position and are focused on our targeted acquisition strategy to further enhance our existing long runway of high interest development opportunities on the acquisition front. We continue to expand our asset footprint through the targeted grassroots acquisition program. We've previously discussed throughout the year during the quarter, we added about $15 million in minerals and royalty assets along with a substantial lease, all of which further build a contiguous asset for an operator for long term development. Thus far, we have acquired about $80 million in minerals and royalty interest since the fourth quarter of 2023 and plan to continue pursuing the creative opportunities which will ultimately drive long term value for our shareholders in East Texas and Louisiana. We continue to work with multiple operators to promote development on our acreage while we also monitor the current commodity environment and prepare the anticipated improvements in the natural gas market and Shelby Trough and other three wells were brought online by Aon in the third quarter with initial production rates in the $20 to $25 million cubic feet per day range. We recently signed amendments to our existing joint exploration agreement and are currently looking at them operating one rig and fracing multiple wells in Angelina County on the Louisiana side of the play Comstock recently turned online multiple wells in the Toledo Bend area for about $25 million cubic feet per day. And we're excited about the ongoing activity in this area as we work with multiple operators to promote near term development overall, it was a successful quarter and we will continue to maintain our strategic objective of working with operators to achieve full development across all of our assets. With the goal of a creative production growth through this active asset management and targeted acquisitions with that. I'll turn it over to Taylor to walk through the financial details of the quarter.
Thanks Tom and good morning everyone. As Tom pointed out, we had a successful quarter. Despite continued commodity price, volatility, mineral and royalty production was 35.3000 BOE per day in the third quarter. And total production volumes were 37.4000 BOE per day. Both of which were down a bit from last quarter. We maintained our updated guidance from the first quarter and continued to thoughtfully review current market dynamics net income was $92.7 million for the third quarter. With adjusted even being $86.4 million. 63% of oil and gas revenue in the quarter came from oil and county state production. We maintained our distribution at 37.5¢ per unit for the quarter or a dollar 50¢ on an annualized basis. Distributable cash flow for the quarter was $78.6 million which represents approximately one times coverage for the quarter. Our solid balance sheet and ample liquidity gives us flexibility through these dynamic market cycles. It provides the opportunity to focus on commercial opportunities in the short and long term. We appreciate working with our banking partners. And as of November 1st, our credit facility was reaffirmed at $580 million with total commitments remaining at $375 million and there are currently no outstanding borrowings on our revolver. As of the end of last week, we had approximately $43 million of cash. We are well hedged for the remainder of the year; our 2024 natural gas hedges are at approximately $3.55 per M and BTU. And comparing that to an average price of $2.16 for the third quarter, we've benefited with a gas settlement of approximately $15 million we have over 60% of our expected gas and oil volumes for the remainder of 2024. That will help insulate our cash flows for near term price volatility. We also have attractive hedges in place for 2025 and we'll maintain our strategy of adding on additional hedges for 2026. Again, we had a successful quarter and we'll continue to focus on generating long term value for our shareholders. With that. I'd like to open the call for questions.
Question and Answer Session
Operator
Gentlemen. Thank you and to our audience joining today on the phones. (Operator instruction). We'll hear from Tim Rezvan with KeyBanc Capital market.
Good morning folks. And thank you for taking my question, I'd like to start first with the, the AON update that you provided. I know you kind of put some factual sort of terms around there. Can you step back and give us kind of an idea on how you see activity level, sort of sort of trending going forward? I think the market consternation was on how 2025 volumes would look if you could kind of just sort of step that picture and say, what is this amendment kind of, what sort of visibility do you have over the next couple of years on activity? Thank you.
Thanks, Tim, this is Taylor. I'll just start off and first, I just want to say, I appreciate your report last night this morning. So just generally speaking, I think taking a step back and looking at the entire macro picture, We're certainly being thoughtful and thinking about natural gas activity across the entire basin and we continue to work with our operators across all of Louisiana and East Texas, as mentioned in Tom's remarks a little bit earlier as it relates to Athon, we continue to work with them as well. And you know, certainly appreciate the activity in the current rig that they're running in the area and we'll continue to work with all of our partners. So I hope I hope that answers your question.
So it is that a way of saying you think there's going to be one dedicated rig on, on the area of interest.
I, I'd say as far as exact rig activity, what I would say about a onn activity just in the hole is that we continue to see them being active in the area. And, as we've seen, historically, they're going to maintain a level of commitment, that, they've been working and we're going to continue to work with them in developing the Shelby Trough.
Okay. Okay. I appreciate that. And then, if I could pivot to the Gulf Coast area, another kind of measured quarter of acquisitions about $15 million and you talked about the progression. Is this cadence of acquisition, is that reflective of your ability to get deals done or are you trying to be measured about that? The spending like theoretically, could you spend $50 or $100 million if something came up next quarter, just trying to understand it sounds like there's a big opportunity set, but just trying to understand that the measured spending to date and maybe where you think you could take that. Thanks.
Yeah, thanks. And that's a good question. And what I'd say is we're continuing to be thoughtful in the current market and our ability to acquire additional minerals in this area in the Gulf coast that we're looking at. I'd say that we've reached a cadence that we feel pretty comfortable about. But we continue to look on a, quarterly, monthly basis, at what opportunities there are and assess those on an individual basis.
Thank you.
Operator
(Operator instruction). I'll turn it back to you for any additional or closing remarks.
Thomas L Carter
Okay. Well, thank you all. We don't have any additional questions and again, we thank you for joining us today and we look forward to talking with you next quarter.
Operator
Ladies and gentlemen, this does conclude today's Blackstone Minerals Conference call and we thank you all for your participation. You may now disconnect your lines.
