Overall positive. Their Del Basin assets are less interesting, as of now, than their Midland Basin assets. Double Eagle affiliation and the integration of DE Flow with the other Midland Assets makes growth almost a sure thing for the next few years. Hopefully they can become the LandBridge of the Midland Basin.
TPL’s release puts their Kilby contribution on the power side (surface + brackish water for the plant). The compute is Microsoft-operated and the release doesn’t site it on TPL acreage. So is Kilby actually datacenter-surface validation, or is that still riding on Bolt? Curious how you’re splitting the power leg from the compute leg here
If you go to the Chevron press release, it implies that the data center is on Project Kirby's land. A good chunk of that lands was TPL's before they sold it to the project. That said, you are correct in the sense that TPL is not trying to monetize the power/data center side via a land lease. But, there are several ways to skin the cat. As pointed out, selling brackish water is one way, but I can see other easements, happening as well. Could benefit LandBridge too that has acreage that abuts the project.
Yea, my concern as a long-term holder is that the market’s capitalizing these deals as recurring AI rent when they could wind up being lumpy land sales + water and easements. Different quality of earnings, and TPL’s multiple is priced for the former
Thanks - sounds good! My concern about e.g. LB was that if this didn't pan out, the stock would be punished, despite the fact that its valuation seems reasonable even without it.
What are your thoughts on EagleRock?
Overall positive. Their Del Basin assets are less interesting, as of now, than their Midland Basin assets. Double Eagle affiliation and the integration of DE Flow with the other Midland Assets makes growth almost a sure thing for the next few years. Hopefully they can become the LandBridge of the Midland Basin.
TPL’s release puts their Kilby contribution on the power side (surface + brackish water for the plant). The compute is Microsoft-operated and the release doesn’t site it on TPL acreage. So is Kilby actually datacenter-surface validation, or is that still riding on Bolt? Curious how you’re splitting the power leg from the compute leg here
If you go to the Chevron press release, it implies that the data center is on Project Kirby's land. A good chunk of that lands was TPL's before they sold it to the project. That said, you are correct in the sense that TPL is not trying to monetize the power/data center side via a land lease. But, there are several ways to skin the cat. As pointed out, selling brackish water is one way, but I can see other easements, happening as well. Could benefit LandBridge too that has acreage that abuts the project.
Yea, my concern as a long-term holder is that the market’s capitalizing these deals as recurring AI rent when they could wind up being lumpy land sales + water and easements. Different quality of earnings, and TPL’s multiple is priced for the former
TPL’s quality of earnings should be improved. Water sales likely much more stable than mineral royalties.
Thanks - sounds good! My concern about e.g. LB was that if this didn't pan out, the stock would be punished, despite the fact that its valuation seems reasonable even without it.
Punished short term, but LandBridge's earnings growth should start to ramp up and if that alone did not fix the stock price, then buybacks will.