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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Black Stone Minerals LP | NYSE:BSM | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.02 | 0.14% | 14.40 | 14.52 | 14.34 | 14.40 | 378,143 | 01:00:00 |
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FORM 10-Q
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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Black Stone Minerals, L.P.
(Exact name of registrant as specified in its charter)
|
Delaware
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47-1846692
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(State or other jurisdiction of
incorporation or organization)
|
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(I.R.S. Employer
Identification No.)
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1001 Fannin Street, Suite 2020
Houston, Texas
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77002
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(Address of principal executive offices)
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(Zip code)
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(713) 445-3200
(Registrant’s telephone number, including area code)
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Page
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March 31, 2017
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December 31, 2016
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||||
ASSETS
|
|
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CURRENT ASSETS
|
|
|
|
|
|
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Cash and cash equivalents
|
|
$
|
14,005
|
|
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$
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9,772
|
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Accounts receivable
|
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74,974
|
|
|
68,181
|
|
||
Prepaid expenses and other current assets
|
|
1,121
|
|
|
1,036
|
|
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TOTAL CURRENT ASSETS
|
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90,100
|
|
|
78,989
|
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||
PROPERTY AND EQUIPMENT
|
|
|
|
|
|
|
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Oil and natural gas properties, at cost, using the successful efforts method of accounting, includes unproved properties of $671,131 and $605,736 at March 31, 2017 and December 31, 2016, respectively
|
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2,776,651
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2,697,073
|
|
||
Accumulated depreciation, depletion, amortization, and impairment
|
|
(1,679,267
|
)
|
|
(1,652,930
|
)
|
||
Oil and natural gas properties, net
|
|
1,097,384
|
|
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1,044,143
|
|
||
Other property and equipment, net of accumulated depreciation of $14,369 and $14,327 at March 31, 2017 and December 31, 2016, respectively
|
|
579
|
|
|
528
|
|
||
NET PROPERTY AND EQUIPMENT
|
|
1,097,963
|
|
|
1,044,671
|
|
||
Deferred charges and other long-term assets
|
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11,659
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|
|
5,167
|
|
||
TOTAL ASSETS
|
|
$
|
1,199,722
|
|
|
$
|
1,128,827
|
|
LIABILITIES, MEZZANINE EQUITY AND EQUITY
|
|
|
|
|
|
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CURRENT LIABILITIES
|
|
|
|
|
|
|
||
Accounts payable
|
|
$
|
3,949
|
|
|
$
|
4,142
|
|
Accrued liabilities
|
|
38,704
|
|
|
50,952
|
|
||
Commodity derivative liabilities
|
|
4,941
|
|
|
16,237
|
|
||
TOTAL CURRENT LIABILITIES
|
|
47,594
|
|
|
71,331
|
|
||
LONG-TERM LIABILITIES
|
|
|
|
|
|
|
||
Credit facility
|
|
388,000
|
|
|
316,000
|
|
||
Accrued incentive compensation
|
|
1,873
|
|
|
1,485
|
|
||
Commodity derivative liabilities
|
|
—
|
|
|
482
|
|
||
Deferred revenue
|
|
658
|
|
|
518
|
|
||
Asset retirement obligations
|
|
13,599
|
|
|
13,350
|
|
||
TOTAL LIABILITIES
|
|
451,724
|
|
|
403,166
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|
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COMMITMENTS AND CONTINGENCIES (Note 8)
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MEZZANINE EQUITY
|
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|
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Partners' equity - convertible redeemable preferred units, 33 and 53 units outstanding at March 31, 2017 and December 31, 2016, respectively
|
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34,145
|
|
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54,015
|
|
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EQUITY
|
|
|
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|
|
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Partners' equity - general partner interest
|
|
—
|
|
|
—
|
|
||
Partners' equity - common units, 97,696 and 95,721 units outstanding at March 31, 2017 and December 31, 2016, respectively
|
|
520,052
|
|
|
489,023
|
|
||
Partners' equity - subordinated units, 95,388 and 95,164 units outstanding at March 31, 2017 and December 31, 2016, respectively
|
|
192,796
|
|
|
181,602
|
|
||
Noncontrolling interests
|
|
1,005
|
|
|
1,021
|
|
||
TOTAL EQUITY
|
|
713,853
|
|
|
671,646
|
|
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TOTAL LIABILITIES, MEZZANINE EQUITY AND EQUITY
|
|
$
|
1,199,722
|
|
|
$
|
1,128,827
|
|
|
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Three Months Ended March 31,
|
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||||||
|
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2017
|
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2016
|
|
||||
REVENUE
|
|
|
|
|
|
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|
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Oil and condensate sales
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$
|
40,474
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|
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$
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27,248
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Natural gas and natural gas liquids sales
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47,701
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25,112
|
|
|
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Gain (loss) on commodity derivative instruments
|
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22,725
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10,626
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|
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Lease bonus and other income
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13,682
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1,395
|
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TOTAL REVENUE
|
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124,582
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64,381
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|
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OPERATING (INCOME) EXPENSE
|
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|
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Lease operating expense
|
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4,189
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|
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4,889
|
|
|
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Production costs and ad valorem taxes
|
|
11,902
|
|
|
7,062
|
|
|
||
Exploration expense
|
|
562
|
|
|
8
|
|
|
||
Depreciation, depletion, and amortization
|
|
26,379
|
|
|
21,721
|
|
|
||
Impairment of oil and natural gas properties
|
|
—
|
|
|
6,096
|
|
|
||
General and administrative
|
|
17,212
|
|
|
17,401
|
|
|
||
Accretion of asset retirement obligations
|
|
247
|
|
|
274
|
|
|
||
(Gain) loss on sale of assets, net
|
|
(924
|
)
|
|
(4,680
|
)
|
|
||
TOTAL OPERATING EXPENSE
|
|
59,567
|
|
|
52,771
|
|
|
||
INCOME (LOSS) FROM OPERATIONS
|
|
65,015
|
|
|
11,610
|
|
|
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OTHER INCOME (EXPENSE)
|
|
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|
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|
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|
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Interest and investment income
|
|
6
|
|
|
153
|
|
|
||
Interest expense
|
|
(3,507
|
)
|
|
(1,048
|
)
|
|
||
Other income (expense)
|
|
69
|
|
|
34
|
|
|
||
TOTAL OTHER EXPENSE
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|
(3,432
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)
|
|
(861
|
)
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NET INCOME (LOSS)
|
|
61,583
|
|
|
10,749
|
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|
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NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
|
(9
|
)
|
|
(2
|
)
|
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DISTRIBUTIONS ON REDEEMABLE PREFERRED UNITS
|
|
(1,114
|
)
|
|
(1,804
|
)
|
|
||
NET INCOME (LOSS) ATTRIBUTABLE TO THE GENERAL PARTNER AND COMMON AND SUBORDINATED UNITS
|
|
$
|
60,460
|
|
|
$
|
8,943
|
|
|
ALLOCATION OF NET INCOME (LOSS):
|
|
|
|
|
|
|
|
||
General partner interest
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Common units
|
|
35,517
|
|
|
8,320
|
|
|
||
Subordinated units
|
|
24,943
|
|
|
623
|
|
|
||
|
|
$
|
60,460
|
|
|
$
|
8,943
|
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO LIMITED PARTNERS PER COMMON AND SUBORDINATED UNIT:
|
|
|
|
|
|
|
|
||
Per common unit (basic)
|
|
$
|
0.37
|
|
|
$
|
0.09
|
|
|
Weighted average common units outstanding (basic)
|
|
96,901
|
|
|
96,484
|
|
|
||
Per subordinated unit (basic)
|
|
$
|
0.26
|
|
|
$
|
0.01
|
|
|
Weighted average subordinated units outstanding (basic)
|
|
95,149
|
|
|
94,995
|
|
|
||
Per common unit (diluted)
|
|
$
|
0.37
|
|
|
$
|
0.09
|
|
|
Weighted average common units outstanding (diluted)
|
|
97,590
|
|
|
96,752
|
|
|
||
Per subordinated unit (diluted)
|
|
$
|
0.26
|
|
|
$
|
0.01
|
|
|
Weighted average subordinated units outstanding (diluted)
|
|
95,149
|
|
|
94,995
|
|
|
||
DISTRIBUTIONS DECLARED AND PAID:
|
|
|
|
|
|
|
|
||
Per common unit
|
|
$
|
0.2875
|
|
|
$
|
0.2625
|
|
|
Per subordinated unit
|
|
$
|
0.1838
|
|
|
$
|
0.1838
|
|
|
|
|
Common
units |
|
Subordinated
units |
|
Partners'
equity— common units |
|
Partners'
equity— subordinated units |
|
Noncontrolling
interests |
|
Total
equity |
||||||||||
BALANCE AT DECEMBER 31, 2016
|
|
95,721
|
|
|
95,164
|
|
|
$
|
489,023
|
|
|
$
|
181,602
|
|
|
$
|
1,021
|
|
|
$
|
671,646
|
|
Restricted units granted, net of forfeitures
|
|
1,565
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Equity-based compensation
|
|
—
|
|
|
—
|
|
|
16,247
|
|
|
271
|
|
|
—
|
|
|
16,518
|
|
||||
Conversion of redeemable preferred units
|
|
201
|
|
|
263
|
|
|
2,868
|
|
|
3,756
|
|
|
—
|
|
|
6,624
|
|
||||
Repurchases of common and subordinated units
|
|
(426
|
)
|
|
(39
|
)
|
|
(7,553
|
)
|
|
(292
|
)
|
|
—
|
|
|
(7,845
|
)
|
||||
Issuance of units for property acquisitions
|
|
635
|
|
|
—
|
|
|
12,199
|
|
|
—
|
|
|
—
|
|
|
12,199
|
|
||||
Distributions
|
|
—
|
|
|
—
|
|
|
(27,920
|
)
|
|
(17,484
|
)
|
|
(25
|
)
|
|
(45,429
|
)
|
||||
Charges to partners' equity for accrued distribution equivalent rights
|
|
—
|
|
|
—
|
|
|
(329
|
)
|
|
—
|
|
|
—
|
|
|
(329
|
)
|
||||
Net income (loss)
|
|
—
|
|
|
—
|
|
|
36,079
|
|
|
25,495
|
|
|
9
|
|
|
61,583
|
|
||||
Distributions on redeemable preferred units
|
|
—
|
|
|
—
|
|
|
(562
|
)
|
|
(552
|
)
|
|
—
|
|
|
(1,114
|
)
|
||||
BALANCE AT MARCH 31, 2017
|
|
97,696
|
|
|
95,388
|
|
|
$
|
520,052
|
|
|
$
|
192,796
|
|
|
$
|
1,005
|
|
|
$
|
713,853
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2017
|
|
2016
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
||
Net income (loss)
|
|
$
|
61,583
|
|
|
$
|
10,749
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation, depletion, and amortization
|
|
26,379
|
|
|
21,721
|
|
||
Impairment of oil and natural gas properties
|
|
—
|
|
|
6,096
|
|
||
Accretion of asset retirement obligations
|
|
247
|
|
|
274
|
|
||
Amortization of deferred charges
|
|
215
|
|
|
197
|
|
||
(Gain) loss on commodity derivative instruments
|
|
(22,725
|
)
|
|
(10,626
|
)
|
||
Net cash received on settlement of commodity derivative instruments
|
|
4,278
|
|
|
20,581
|
|
||
Equity-based compensation
|
|
4,661
|
|
|
5,900
|
|
||
(Gain) loss on sale of assets, net
|
|
(924
|
)
|
|
(4,680
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||
Accounts receivable
|
|
(6,568
|
)
|
|
(3,039
|
)
|
||
Prepaid expenses and other current assets
|
|
(85
|
)
|
|
(196
|
)
|
||
Accounts payable and accrued liabilities
|
|
(2,739
|
)
|
|
(20,814
|
)
|
||
Deferred revenue
|
|
(325
|
)
|
|
(203
|
)
|
||
Settlement of asset retirement obligations
|
|
(43
|
)
|
|
(54
|
)
|
||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
|
63,954
|
|
|
25,906
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
||
Additions to oil and natural gas properties
|
|
(17,615
|
)
|
|
(25,110
|
)
|
||
Purchase of other property and equipment
|
|
(93
|
)
|
|
(5
|
)
|
||
Proceeds from the sale of oil and natural gas properties
|
|
1,993
|
|
|
33
|
|
||
Acquisitions of oil and natural gas properties
|
|
(48,371
|
)
|
|
(10,000
|
)
|
||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
|
(64,086
|
)
|
|
(35,082
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
||
Borrowings under senior line of credit
|
|
103,000
|
|
|
61,000
|
|
||
Repayments of borrowings under senior line of credit
|
|
(31,000
|
)
|
|
(11,000
|
)
|
||
Distributions to Black Stone Minerals, L.P. common and subordinated unitholders
|
|
(45,404
|
)
|
|
(42,864
|
)
|
||
Distributions to redeemable preferred unitholders
|
|
(1,619
|
)
|
|
(1,946
|
)
|
||
Distributions to noncontrolling interests
|
|
(25
|
)
|
|
(33
|
)
|
||
Redemptions of redeemable preferred units
|
|
(12,742
|
)
|
|
—
|
|
||
Repurchases of common and subordinated units
|
|
(7,845
|
)
|
|
(4,201
|
)
|
||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
|
4,365
|
|
|
956
|
|
||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
|
4,233
|
|
|
(8,220
|
)
|
||
CASH AND CASH EQUIVALENTS - beginning of the period
|
|
9,772
|
|
|
13,233
|
|
||
CASH AND CASH EQUIVALENTS - end of the period
|
|
$
|
14,005
|
|
|
$
|
5,013
|
|
SUPPLEMENTAL DISCLOSURE
|
|
|
|
|
||||
Interest paid
|
|
$
|
3,156
|
|
|
$
|
829
|
|
|
For the three months ended
|
||
|
March 31, 2017
|
||
|
(In thousands)
|
||
Beginning asset retirement obligations
|
$
|
13,350
|
|
Liabilities incurred
|
45
|
|
|
Liabilities settled
|
(43
|
)
|
|
Accretion expense
|
247
|
|
|
Revisions
|
—
|
|
|
Ending asset retirement obligations
|
$
|
13,599
|
|
|
(In thousands)
|
||
Proved oil and natural gas properties
|
$
|
3,331
|
|
Unproved oil and natural gas properties
|
18,802
|
|
|
Net working capital
|
204
|
|
|
Total fair value
|
$
|
22,337
|
|
|
(In thousands)
|
||
Proved oil and natural gas properties
|
$
|
1,804
|
|
Unproved oil and natural gas properties
|
15,206
|
|
|
Net working capital
|
59
|
|
|
Total fair value
|
$
|
17,069
|
|
|
(In thousands)
|
||
Proved oil and natural gas properties
|
$
|
18,948
|
|
Unproved oil and natural gas properties
|
14,082
|
|
|
Net working capital
|
1,038
|
|
|
Asset retirement obligations
|
(50
|
)
|
|
Total fair value
|
$
|
34,018
|
|
|
(In thousands)
|
||
Proved oil and natural gas properties
|
$
|
20,787
|
|
Unproved oil and natural gas properties
|
65,745
|
|
|
Net working capital
|
1,026
|
|
|
Total fair value
|
$
|
87,558
|
|
As of March 31, 2017
|
||||||||||||||
Classification
|
|
Balance Sheet Location
|
|
Gross Fair
Value |
|
Effect of
Counterparty Netting |
|
Net Carrying
Value on Balance Sheet |
||||||
|
|
|
|
|
|
|
(In thousands)
|
|
|
|||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current asset
|
|
Commodity derivative assets
|
|
$
|
6,528
|
|
|
$
|
6,528
|
|
|
$
|
—
|
|
Long-term asset
|
|
Deferred charges and other
long-term assets
|
|
6,669
|
|
|
—
|
|
|
6,669
|
|
|||
Total assets
|
|
|
|
$
|
13,197
|
|
|
$
|
6,528
|
|
|
$
|
6,669
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current liability
|
|
Commodity derivative liabilities
|
|
$
|
11,469
|
|
|
$
|
6,528
|
|
|
$
|
4,941
|
|
Long-term liability
|
|
Commodity derivative liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total liabilities
|
|
|
|
$
|
11,469
|
|
|
$
|
6,528
|
|
|
$
|
4,941
|
|
As of December 31, 2016
|
||||||||||||||
Classification
|
|
Balance Sheet Location
|
|
Gross Fair
Value |
|
Effect of
Counterparty Netting |
|
Net Carrying
Value on Balance Sheet |
||||||
|
|
|
|
|
|
|
(In thousands)
|
|
|
|||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current asset
|
|
Commodity derivative assets
|
|
$
|
3,879
|
|
|
$
|
3,879
|
|
|
$
|
—
|
|
Long-term asset
|
|
Deferred charges and other
long-term assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total assets
|
|
|
|
$
|
3,879
|
|
|
$
|
3,879
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current liability
|
|
Commodity derivative liabilities
|
|
$
|
20,116
|
|
|
$
|
3,879
|
|
|
$
|
16,237
|
|
Long-term liability
|
|
Commodity derivative liabilities
|
|
482
|
|
|
—
|
|
|
482
|
|
|||
Total liabilities
|
|
|
|
$
|
20,598
|
|
|
$
|
3,879
|
|
|
$
|
16,719
|
|
|
|
For the Three Months Ended March 31,
|
||||||
Derivatives not designated as hedging instruments
|
|
2017
|
|
2016
|
||||
|
|
(In thousands)
|
||||||
Beginning fair value of commodity derivative instruments
|
|
$
|
(16,719
|
)
|
|
$
|
64,534
|
|
Gain (loss) on oil derivative instruments
|
|
14,305
|
|
|
2,926
|
|
||
Gain (loss) on natural gas derivative instruments
|
|
8,420
|
|
|
7,700
|
|
||
Net cash received on settlements of oil derivative
instruments
|
|
(2,809
|
)
|
|
(12,572
|
)
|
||
Net cash received on settlements of natural gas
derivative instruments
|
|
(1,469
|
)
|
|
(8,009
|
)
|
||
Net change in fair value of commodity derivative
instruments
|
|
18,447
|
|
|
(9,955
|
)
|
||
Ending fair value of commodity derivative instruments
|
|
$
|
1,728
|
|
|
$
|
54,579
|
|
|
|
|
|
|
|
Range (Per Bbl)
|
|||||||||
Period and Type of Contract
|
|
Volume
(Bbl) |
|
Weighted Average
(Per Bbl) |
|
Low
|
|
High
|
|||||||
Oil Swap Contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
First Quarter
|
|
223,000
|
|
|
$
|
59.06
|
|
|
$
|
51.20
|
|
|
$
|
63.65
|
|
Second Quarter
|
|
615,000
|
|
|
54.06
|
|
|
51.45
|
|
|
55.23
|
|
|||
Third Quarter
|
|
556,000
|
|
|
53.29
|
|
|
52.04
|
|
|
55.23
|
|
|||
Fourth Quarter
|
|
516,000
|
|
|
53.56
|
|
|
52.57
|
|
|
55.23
|
|
|||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
First Quarter
|
|
475,000
|
|
|
$
|
54.74
|
|
|
$
|
54.50
|
|
|
$
|
55.05
|
|
Second Quarter
|
|
445,000
|
|
|
54.73
|
|
|
54.50
|
|
|
54.90
|
|
|||
Third Quarter
|
|
425,000
|
|
|
54.72
|
|
|
54.50
|
|
|
54.90
|
|
|||
Fourth Quarter
|
|
405,000
|
|
|
54.72
|
|
|
54.50
|
|
|
54.90
|
|
|
|
|
|
|
|
Range (Per MMBtu)
|
|||||||||
Period and Type of Contract
|
|
Volume
(MMBtu) |
|
Weighted Average
(Per MMBtu) |
|
Low
|
|
High
|
|||||||
Natural Gas Swap Contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Second Quarter
|
|
12,380,000
|
|
|
$
|
3.11
|
|
|
$
|
2.85
|
|
|
$
|
3.40
|
|
Third Quarter
|
|
11,210,000
|
|
|
3.05
|
|
|
2.90
|
|
|
3.41
|
|
|||
Fourth Quarter
|
|
10,520,000
|
|
|
3.13
|
|
|
2.92
|
|
|
3.57
|
|
|||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
First Quarter
|
|
9,300,000
|
|
|
$
|
3.04
|
|
|
$
|
2.96
|
|
|
$
|
3.37
|
|
Second Quarter
|
|
8,100,000
|
|
|
3.00
|
|
|
2.96
|
|
|
3.11
|
|
|||
Third Quarter
|
|
7,100,000
|
|
|
2.99
|
|
|
2.96
|
|
|
3.02
|
|
|||
Fourth Quarter
|
|
6,300,000
|
|
|
2.99
|
|
|
2.96
|
|
|
3.02
|
|
|
|
Volume
(MMBtu) |
|
Weighted Average
(Per MMBtu) |
|
Range (Per MMBtu)
|
|||||||||
Period and Type of Contract
|
|
|
|
Low
|
|
High
|
|||||||||
Natural Gas Swap Contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Second Quarter
|
|
630,000
|
|
|
$
|
3.36
|
|
|
$
|
3.35
|
|
|
$
|
3.37
|
|
Third Quarter
|
|
730,000
|
|
|
3.37
|
|
|
3.36
|
|
|
3.41
|
|
|||
Fourth Quarter
|
|
250,000
|
|
|
3.27
|
|
|
3.13
|
|
|
3.37
|
|
|||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
First Quarter
|
|
150,000
|
|
|
$
|
3.13
|
|
|
$
|
3.13
|
|
|
$
|
3.13
|
|
Second Quarter
|
|
320,000
|
|
|
3.00
|
|
|
2.86
|
|
|
3.13
|
|
|||
Third Quarter
|
|
270,000
|
|
|
3.02
|
|
|
2.90
|
|
|
3.13
|
|
|||
Fourth Quarter
|
|
270,000
|
|
|
3.02
|
|
|
2.90
|
|
|
3.13
|
|
|
|
Fair Value Measurements Using
|
|
Effect of
Counterparty Netting |
|
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Total
|
|||||||||||
|
|
(In thousands)
|
||||||||||||||||||
As of March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commodity derivative instruments
|
|
$
|
—
|
|
|
$
|
6,669
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,669
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commodity derivative instruments
|
|
—
|
|
|
4,941
|
|
|
—
|
|
|
—
|
|
|
4,941
|
|
|||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commodity derivative instruments
|
|
$
|
—
|
|
|
$
|
16,719
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16,719
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commodity derivative instruments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Fair Value Measurements Using
|
|
Net Book
Value 1 |
|
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Impairment
|
|||||||||||
|
|
(In thousands)
|
||||||||||||||||||
Three months ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Impaired oil and natural gas properties
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Three months ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Impaired oil and natural gas properties
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,499
|
|
|
$
|
8,595
|
|
|
$
|
6,096
|
|
|
|
|
Three Months Ended March 31,
|
||||||
Incentive compensation expense
|
|
2017
|
|
2016
|
||||
|
|
(In thousands)
|
||||||
Cash—long-term incentive plan
|
|
$
|
422
|
|
|
$
|
1,850
|
|
Equity-based compensation—restricted common and subordinated units
|
|
1,808
|
|
|
2,743
|
|
||
Equity-based compensation—restricted performance units
|
|
2,353
|
|
|
2,613
|
|
||
Board of Directors incentive plan
|
|
500
|
|
|
481
|
|
||
Total incentive compensation expense
|
|
$
|
5,083
|
|
|
$
|
7,687
|
|
|
|
For the Three Months Ended March 31,
|
||||||
|
|
2017
|
|
2016
|
||||
|
|
(In thousands, except per unit amounts)
|
||||||
NET INCOME (LOSS)
|
|
$
|
61,583
|
|
|
$
|
10,749
|
|
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
|
(9
|
)
|
|
(2
|
)
|
||
DISTRIBUTIONS ON REDEEMABLE PREFERRED UNITS
|
|
(1,114
|
)
|
|
(1,804
|
)
|
||
NET INCOME (LOSS) ATTRIBUTABLE TO THE GENERAL PARTNER AND COMMON AND SUBORDINATED UNITS
|
|
$
|
60,460
|
|
|
$
|
8,943
|
|
ALLOCATION OF NET INCOME (LOSS):
|
|
|
|
|
|
|
||
General partner interest
|
|
$
|
—
|
|
|
$
|
—
|
|
Common units
|
|
35,517
|
|
|
8,320
|
|
||
Subordinated units
|
|
24,943
|
|
|
623
|
|
||
|
|
$
|
60,460
|
|
|
$
|
8,943
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO LIMITED PARTNERS PER COMMON AND SUBORDINATED UNIT:
|
|
|
|
|
|
|
||
Per common unit (basic)
|
|
$
|
0.37
|
|
|
$
|
0.09
|
|
Weighted average common units outstanding (basic)
|
|
96,901
|
|
|
96,484
|
|
||
Per subordinated unit (basic)
|
|
$
|
0.26
|
|
|
$
|
0.01
|
|
Weighted average subordinated units outstanding (basic)
|
|
95,149
|
|
|
94,995
|
|
||
Per common unit (diluted)
|
|
$
|
0.37
|
|
|
$
|
0.09
|
|
Weighted average common units outstanding (diluted)
|
|
97,590
|
|
|
96,752
|
|
||
Per subordinated unit (diluted)
|
|
$
|
0.26
|
|
|
$
|
0.01
|
|
Weighted average subordinated units outstanding (diluted)
|
|
95,149
|
|
|
94,995
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
our ability to execute our business strategies;
|
•
|
the volatility of realized oil and natural gas prices;
|
•
|
the level of production on our properties;
|
•
|
regional supply and demand factors, delays, or interruptions of production;
|
•
|
our ability to replace our oil and natural gas reserves;
|
•
|
our ability to identify, complete, and integrate acquisitions;
|
•
|
general economic, business, or industry conditions;
|
•
|
competition in the oil and natural gas industry;
|
•
|
the ability of our operators to obtain capital or financing needed for development and exploration operations;
|
•
|
title defects in the properties in which we invest;
|
•
|
the availability or cost of rigs, equipment, raw materials, supplies, oilfield services, or personnel;
|
•
|
restrictions on the use of water;
|
•
|
the availability of transportation facilities;
|
•
|
the ability of our operators to comply with applicable governmental laws and regulations and to obtain permits and governmental approvals;
|
•
|
federal and state legislative and regulatory initiatives relating to hydraulic fracturing;
|
•
|
future operating results;
|
•
|
future cash flows and liquidity, including our ability to generate sufficient cash to pay quarterly distributions;
|
•
|
exploration and development drilling prospects, inventories, projects, and programs;
|
•
|
operating hazards faced by our operators;
|
•
|
the ability of our operators to keep pace with technological advancements; and
|
•
|
certain factors discussed elsewhere in this filing.
|
|
|
2017
|
|
2016
|
||||
Benchmark Prices
|
|
First Quarter
|
|
First Quarter
|
||||
WTI spot oil price ($/Bbl)
|
|
$
|
50.54
|
|
|
$
|
36.94
|
|
Henry Hub spot natural gas ($/MMBtu)
|
|
$
|
3.13
|
|
|
$
|
1.98
|
|
|
|
|
2017
|
|
2016
|
||
U.S. Rotary Rig Count
|
|
First Quarter
|
|
First Quarter
|
||
Oil
|
|
662
|
|
|
372
|
|
Natural gas
|
|
160
|
|
|
92
|
|
Other
|
|
2
|
|
|
—
|
|
Total
|
|
824
|
|
|
464
|
|
|
|
|
2017
|
|
2016
|
||
Region
|
|
First Quarter
|
|
First Quarter
|
||
|
|
(Bcf)
|
||||
East
|
|
268
|
|
|
439
|
|
Midwest
|
|
479
|
|
|
555
|
|
Mountain
|
|
142
|
|
|
147
|
|
Pacific
|
|
216
|
|
|
262
|
|
South Central
|
|
946
|
|
|
1,065
|
|
Total
|
|
2,051
|
|
|
2,468
|
|
|
•
|
volumes of oil and natural gas produced;
|
•
|
commodity prices including the effect of derivative instruments; and
|
•
|
EBITDA, Adjusted EBITDA, and cash available for distribution.
|
•
|
Oil
. The substantial majority of our oil production is sold at prevailing market prices, which fluctuate in response to many factors that are outside of our control. NYMEX light sweet crude oil, commonly referred to as WTI, is the prevailing domestic oil pricing index. The majority of our oil production is priced at the prevailing market price with the final realized price affected by both quality and location differentials.
|
•
|
Natural Gas.
The NYMEX price quoted at Henry Hub is a widely used benchmark for the pricing of natural gas in the United States. The actual volumetric prices realized from the sale of natural gas differ from the quoted NYMEX price as a result of quality and location differentials.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2017
|
|
2016
|
||||
|
|
(Unaudited)
(In thousands)
|
||||||
Net income (loss)
|
|
$
|
61,583
|
|
|
$
|
10,749
|
|
Adjustments to reconcile to Adjusted EBITDA:
|
|
|
|
|
|
|
||
Add:
|
|
|
|
|
|
|
||
Depreciation, depletion and amortization
|
|
26,379
|
|
|
21,721
|
|
||
Interest expense
|
|
3,507
|
|
|
1,048
|
|
||
EBITDA
|
|
91,469
|
|
|
33,518
|
|
||
Add:
|
|
|
|
|
|
|
||
Impairment of oil and natural gas properties
|
|
—
|
|
|
6,096
|
|
||
Accretion of asset retirement obligations
|
|
247
|
|
|
274
|
|
||
Equity-based compensation
|
|
4,661
|
|
|
5,900
|
|
||
Unrealized loss on commodity derivative instruments
|
|
—
|
|
|
9,955
|
|
||
Less:
|
|
|
|
|
||||
Unrealized gain on commodity derivative instruments
|
|
(18,447
|
)
|
|
—
|
|
||
Adjusted EBITDA
|
|
77,930
|
|
|
55,743
|
|
||
Adjustments to reconcile to cash generated from operations:
|
|
|
|
|
|
|
||
Less:
|
|
|
|
|
|
|
||
Change in deferred revenue
|
|
(325
|
)
|
|
(203
|
)
|
||
Cash interest expense
|
|
(3,292
|
)
|
|
(851
|
)
|
||
(Gain) loss on sales of assets, net
|
|
(924
|
)
|
|
(4,680
|
)
|
||
Estimated replacement capital expenditures
1
|
|
(3,750
|
)
|
|
—
|
|
||
Cash generated from operations
|
|
69,639
|
|
|
50,009
|
|
||
Less:
|
|
|
|
|
|
|
||
Cash paid to noncontrolling interests
|
|
(25
|
)
|
|
(33
|
)
|
||
Redeemable preferred unit distributions
|
|
(1,114
|
)
|
|
(1,804
|
)
|
||
Cash generated from operations available for distribution on common and subordinated units and reinvestment in our business
|
|
$
|
68,500
|
|
|
$
|
48,172
|
|
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
|
2017
|
|
2016
|
|
Variance
|
||||||||
|
|
(Unaudited)
(Dollars in thousands, except for realized prices)
|
||||||||||||
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Oil and condensate (MBbls)
|
|
861
|
|
|
886
|
|
|
(25
|
)
|
|
(2.8
|
)%
|
||
Natural gas (MMcf)
1
|
|
14,060
|
|
|
11,250
|
|
|
2,810
|
|
|
25.0
|
%
|
||
Equivalents (MBoe)
|
|
3,204
|
|
|
2,761
|
|
|
443
|
|
|
16.0
|
%
|
||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
||||
Oil and condensate sales
|
|
$
|
40,474
|
|
|
$
|
27,248
|
|
|
13,226
|
|
|
48.5
|
%
|
Natural gas and natural gas liquids sales
|
|
47,701
|
|
|
25,112
|
|
|
22,589
|
|
|
90.0
|
%
|
||
Gain on commodity derivative instruments
|
|
22,725
|
|
|
10,626
|
|
|
12,099
|
|
|
113.9
|
%
|
||
Lease bonus and other income
|
|
13,682
|
|
|
1,395
|
|
|
12,287
|
|
|
880.8
|
%
|
||
Total revenue
|
|
$
|
124,582
|
|
|
$
|
64,381
|
|
|
60,201
|
|
|
93.5
|
%
|
Realized prices:
|
|
|
|
|
|
|
|
|
|
|
||||
Oil and condensate ($/Bbl)
|
|
$
|
47.01
|
|
|
$
|
30.75
|
|
|
16.26
|
|
|
52.9
|
%
|
Natural gas ($/Mcf)
1
|
|
3.39
|
|
|
2.23
|
|
|
1.16
|
|
|
52.0
|
%
|
||
Equivalents ($/Boe)
|
|
$
|
27.52
|
|
|
$
|
18.96
|
|
|
8.56
|
|
|
45.1
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||
Lease operating expense
|
|
$
|
4,189
|
|
|
$
|
4,889
|
|
|
(700
|
)
|
|
(14.3
|
)%
|
Production costs and ad valorem taxes
|
|
11,902
|
|
|
7,062
|
|
|
4,840
|
|
|
68.5
|
%
|
||
Exploration expense
|
|
562
|
|
|
8
|
|
|
554
|
|
|
6,925.0
|
%
|
||
Depreciation, depletion, and amortization
|
|
26,379
|
|
|
21,721
|
|
|
4,658
|
|
|
21.4
|
%
|
||
Impairment of oil and natural gas properties
|
|
—
|
|
|
6,096
|
|
|
(6,096
|
)
|
|
(100.0
|
)%
|
||
General and administrative
|
|
17,212
|
|
|
17,401
|
|
|
(189
|
)
|
|
(1.1
|
)%
|
|
1
|
As a mineral-and-royalty-interest owner, we are often provided insufficient and inconsistent data on NGL volumes by our operators. As a result, we are unable to reliably determine the total volumes of NGLs associated with the production of natural gas on our acreage. Accordingly, no NGL volumes are included in our reported production; however, revenue attributable to NGLs is included in our natural gas revenue and our calculation of realized prices for natural gas.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2017
|
|
2016
|
||||
|
|
(Unaudited)
(In thousands)
|
||||||
Cash flows provided by (used in) operating activities
|
|
$
|
63,954
|
|
|
$
|
25,906
|
|
Cash flows provided by (used in) investing activities
|
|
(64,086
|
)
|
|
(35,082
|
)
|
||
Cash flows provided by (used in) financing activities
|
|
4,365
|
|
|
956
|
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Purchases of Common Units
|
||||||||||||||||||
Period
|
|
Total Number of Common Units Purchased
|
|
Average Price Paid Per Unit
|
|
Total Number of Common Units Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Dollar Value of Common Units That May Yet Be Purchased Under the Plans or Programs
|
||||||||||
January 1 - January 31, 2017
|
|
75,704
|
|
|
$
|
19.18
1
|
|
|
|
|
—
|
|
|
$
|
—
|
|
|
|
March 1 - March 31, 2017
|
|
350,321
|
|
|
$
|
17.35
1
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchases of Subordinated Units
|
||||||||||||||||||
Period
|
|
Total Number of Subordinated Units Purchased
|
|
Average Price Paid Per Unit
|
|
Total Number of Subordinated Units Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Dollar Value of Subordinated Units That May Yet Be Purchased Under the Plans or Programs
|
||||||||||
January 1 - January 31, 2017
|
|
14,220
|
|
|
|
2
|
|
|
—
|
|
|
|
|
$
|
—
|
|
|
|
March 1 - March 31, 2017
|
|
24,807
|
|
|
|
2
|
|
|
—
|
|
|
|
|
—
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchases of Preferred Units
|
||||||||||||||||||
Period
|
|
Total Number of Preferred Units Purchased
|
|
Average Price Paid Per Unit
|
|
Total Number of Preferred Units Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Dollar Value of Preferred Units That May Yet Be Purchased Under the Plans or Programs
|
||||||||||
February 1 - February 28, 2017
|
|
1,556
|
|
|
$
|
1,015
|
|
|
|
1,556
3
|
|
|
|
|
$
|
—
|
|
|
March 1 - March 31, 2017
|
|
11,186
|
|
|
$
|
1,024
|
|
|
|
11,186
3
|
|
|
|
|
—
|
|
|
Item 6.
|
Exhibits
|
|
BLACK STONE MINERALS, L.P.
|
||
|
|
||
|
By:
|
|
Black Stone Minerals GP, L.L.C.,
its general partner
|
|
|
|
|
Date: May 9, 2017
|
By:
|
|
/s/ Thomas L. Carter, Jr.
|
|
|
|
Thomas L. Carter, Jr.
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
Date: May 9, 2017
|
By:
|
|
/s/ Jeffrey P. Wood
|
|
|
|
Jeffrey P. Wood
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
Exhibit Number
|
|
Description
|
|
|
|
3.1
|
|
Certificate of Limited Partnership of Black Stone Minerals, L.P. (incorporated herein by reference to Exhibit 3.1 to Black Stone Minerals, L.P.’s Registration Statement on Form S-1 filed on March 19, 2015 (SEC File No. 333-202875)).
|
|
|
|
3.2
|
|
Certificate of Amendment to Certificate of Limited Partnership of Black Stone Minerals, L.P. (incorporated herein by reference to Exhibit 3.2 to Black Stone Minerals, L.P.’s Registration Statement on Form S-1 filed on March 19, 2015 (SEC File No. 333-202875)).
|
|
|
|
3.3
|
|
First Amended and Restated Agreement of Limited Partnership of Black Stone Minerals, L.P., dated May 6, 2015, by and among Black Stone Minerals GP, L.L.C. and Black Stone Minerals Company, L.P., as amended by Amendment No. 1 to First Amended and Restated Agreement of Limited Partnership of Black Stone Minerals, L.P. dated as of April 15, 2016 (incorporated herein by reference to Exhibit 3.2 of Black Stone Minerals, L.P.’s Current Report on Form 8-K filed on April 19, 2016 (SEC File No. 001-37362)).
|
|
|
|
*31.1
|
|
Certification of Chief Executive Officer of Black Stone Minerals, L.P. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
*31.2
|
|
Certification of Chief Financial Officer of Black Stone Minerals, L.P. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
*32.1
|
|
Certification of Chief Executive Officer and Chief Financial Officer of Black Stone Minerals, L.P. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
*101.INS
|
|
XBRL Instance Document
|
|
|
|
*101.SCH
|
|
XBRL Schema Document
|
|
|
|
*101.CAL
|
|
XBRL Calculation Linkbase Document
|
|
|
|
*101.LAB
|
|
XBRL Label Linkbase Document
|
|
|
|
*101.PRE
|
|
XBRL Presentation Linkbase Document
|
|
|
|
*101.DEF
|
|
XBRL Definition Linkbase Document
|
|
1 Year Black Stone Minerals Chart |
1 Month Black Stone Minerals Chart |
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