Company: BSM
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001628280-25-022559
Chunk: 73

Company: Black Stone Minerals, L.P.
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 8
Chunk 73
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, two new LNG export facilities began operations during the quarter, driving additional demand and higher prices. Given the dynamic nature of these events, including uncertainty regarding changes in trade policies and their resulting consequences, we cannot reasonably estimate how long these market conditions will persist. While we use derivative instruments to partially mitigate the impact of commodity price volatility, our revenues and operating results depend significantly upon the prevailing prices for oil and natural gas.

The following table reflects commodity prices at the end of each quarter presented:20252024Benchmark Prices1First QuarterFirst QuarterWTI spot oil price ($/Bbl)$71.87 $83.96 Henry Hub spot natural gas ($/MMBtu)4.11 1.54 

1    Source:  EIA

Rig Count

As we are not the operator of record on any producing properties, drilling on our acreage is dependent upon the exploration and production companies that lease our acreage. In addition to drilling plans that we seek from our operators, we also monitor rig counts in an effort to identify existing and future leasing and drilling activity on our acreage. 

The following table shows the rig count at the end of each quarter presented:20252024U.S. Rotary Rig Count1First QuarterFirst QuarterOil484 506 Natural gas103 112 Other5 3 Total592 621 

1    Source:  Baker Hughes Incorporated

19

Natural Gas Storage

A substantial portion of our revenue is derived from sales of oil production attributable to our interests; however, the majority of our production is natural gas. Natural gas prices are significantly influenced by storage levels throughout the year. Accordingly, we monitor the natural gas storage reports regularly in the evaluation of our business and its outlook.

Historically, natural gas supply and demand fluctuates on a seasonal basis. From April to October, when the weather is warmer and natural gas demand is lower, natural gas storage levels generally increase. From November to March, storage levels typically decline as utility companies draw natural gas from storage to meet increased heating demand due to colder weather. In order to maintain sufficient storage levels for increased seasonal demand, a portion of natural gas production during the summer months must be used for storage injection. The portion of production used for storage varies from year to year depending on the demand from the previous winter and the demand for electricity used for cooling during the summer months. The U.S. Energy Information Administration ("EIA") expects inventories will rise to 3.7 Tcf by the end of October 2025