Granite Ridge at 16th Annual Midwest Ideas Conference: Strategic Expansion in Energy

On Tuesday, 26 August 2025, Granite Ridge Resources Inc (NYSE:GRNT) outlined its strategic vision at the 16th Annual Midwest Ideas Conference. The company emphasized its commitment to becoming a leading public investment platform in U.S. energy development, highlighting both its financial robustness and strategic challenges in an evolving market landscape.

Key Takeaways

• Granite Ridge aims to lead in U.S. energy development, focusing on disciplined capital allocation and shareholder value.
• The company reported a 28% year-over-year production growth, maintaining a leverage ratio of 0.8x net debt to trailing twelve months EBITDAX.
• Granite Ridge plans to close over 50 deals in 2025, expanding its inventory by 74 net locations.
• The company is bullish on the U.S. energy market, citing an undersupplied market and higher commodity prices.
• A strong emphasis is placed on operated partnerships in the Permian Basin, specifically the Delaware.

Financial Results

• Production Growth: 28% year-over-year increase, reflecting strong operational performance.
• Leverage Ratio: 0.8x net debt to trailing twelve months EBITDAX, below the target of 1 to 1.5, and lower than peers.
• Dividend Yield: Approximately 8% to 9%, providing attractive returns to shareholders.
• Valuation: Approximately 2.6x this year’s EBITDA, indicating a competitive market position.

Operational Updates

• Diversified Asset Base: Spanning six premier basins with 65 operating partners, with nearly two-thirds of Q2 production from the Permian Basin.
• Commodity Mix: Balanced at 50% oil and 50% natural gas, allowing flexibility in market conditions.
• Investment Strategies: Focus on operated partnerships for controlled investments and traditional non-op for diversification.
• Production Growth: Achieved a 47% compounded annual growth rate since 2017, with development CapEx under $80 million for nine consecutive quarters.

Future Outlook

• Deal Pipeline: Over 50 deals expected to close in 2025, expanding inventory by 74 net locations.
• Production Targets: Anticipates 2025 production of 32,000 BOE per day, a 28% increase year-over-year.
• Capital Expenditure: $410 million planned for 2025, with two-thirds allocated to operated partnerships in the Permian Basin.

Q&A Highlights

• Operator Partnership Model: Involves Joint Development Agreements with private operators, where Granite Ridge takes 90% to 95% of the working interest.
• Economies of Scale: The company prioritizes growth, leveraging economies of scale to enhance operational efficiency.

For further insights, readers are encouraged to refer to the full transcript provided below.

Full transcript - 16th Annual Midwest Ideas Conference:

James Masters, Vice President of Investor Relations, Granite Ridge: Thank you, Earl. Good morning, everyone. Thank you for joining us today. Thanks to three part advisers for putting on yet another outstanding event. We’re really glad to participate this year.

Appreciate,

Unidentified speaker: everybody’s interest. Let’s see if this works. Yep.

James Masters, Vice President of Investor Relations, Granite Ridge: Okay. So it is my pleasure to invest to to present on behalf of Granite Ridge. As you said, my name is James Masters, the vice president of investor relations at Granite Ridge. You know, I’ve spent my entire career in oil and gas finance and investor relations. And, you know, I’ve seen up cycles.

I’ve participated in the down cycles, and I can honestly say I’ve never worked for a company quite like Granite Ridge. This company, as I think you’ll see, is tailor made for the macro environment that we’re in right now. We’re creating shareholder value through smart investing, disciplined capital allocation and steady growth in The U. S. Energy development space.

So what I want to do today is walk you through who we are, the macro backdrop that we currently see, frankly, why do we exist, and frank and how do we invest. And at the end of that, I want you to see why we believe Granite Ridge is so well positioned for the current market. My goal is to keep this straightforward, but also give you a feel for the conviction that we have in our strategy. As we move into, the presentation, I want you to take away this. At Granite Ridge, our vision is very simple.

It’s to become the leading public investment platform for US energy development. So how do we get there? We get there by investing alongside proven, high quality management teams to capture undervalued near term opportunities. And by doing so with discipline, every project we underwrite delivers or is aimed to deliver a greater than 25% full cycle return. This discipline has fueled asset growth over time.

And importantly, it’s paired with two principles that we never compromise. One, a commitment to the dividend and to a strong balance sheet. For us, those are the pillars of value creation. Granite Ridge’s strategy is simple, it’s repeatable, and it’s disciplined. We invest for returns, we protect the balance sheet, and we share value with our shareholders.

Now when you think of Granite Ridge, I want you to think diversification. For a small cap producer or frankly, small cap company in any sector, diversification is a big edge. To gives us optionality to invest in good markets and bad and provide a natural balance and a hedge against volatility. We’re also diversified across six premier basins with 65 operating partners, but we’re also concentrated where it counts in the Permian Basin. See, nearly twothree of our second quarter production came from the Permian, which is the heart of U.

S. Energy growth. I’d like to also point out that our commodity mix is 50 oil and 50% natural gas, which gives us tremendous optionality throughout the commodity cycles. But I’d like to ground you with four numbers when it comes to Granite Ridge because these four numbers tell you a lot about who we are. Now number one is growth.

You’ll see in that top left box production growth of 28% year over year. So our production guidance reflects that. Raised our full year production guidance after the second quarter earnings by 10%. We’ve been seeing tremendous results in our operating portfolio. Alongside of that production growth is significant cash flow growth year over year.

Next is the balance sheet. We’ve been growing significantly, but we are laser focused on maintaining a rock solid balance sheet. Our leverage ratio right now is 0.8x net debt to trailing twelve months EBITDAX, and we have a comfort level there at one to 1.5. So we feel like we are underlevered relative to our target and underlevered relative to our peers. Third, yield.

Our fixed dividend today represents about an 8% to 9% dividend yield. And then finally, value. We’re trading just a little over 2.6x this year’s EBITDA. Put together, that’s growth, that’s balance sheet strength, its yield, and its value, all in one package. That combination is rare in small cap companies no matter the industry.

So let’s zoom out. I said I was gonna talk about the macro backdrop. If we’re gonna, fashion ourselves in this investment platform, I’d like you to know why we think we exist. Why does it matter in today’s market? We’re not an oil and gas producer as traditionally defined.

And so we look at the market, and we’re trying to find, opportunities for our investment thesis to, to move forward. So we are I want to kinda make this very clear. We are US Energy Bulls, and the next three slides will show you why. First, activity levels in US shale have dropped meaningfully since 02/2022. Rig counts are down, frac spreads are down, and both remain well below pre COVID levels, 30% lower in US rig count and 45% lower in frac spreads.

Activity is simply not keeping pace with what we saw a few years ago. And when activity stays low for this long, supply follows, which is why we’re seeing U. S. Supply growth has stalled. Second, reinvestment rates are rising.

In other words, it’s taking more capital to hold production flat. That tells you something about the quality of the asset base industry wide. It’s deteriorating. Third, well productive well productivity is declining. This is one of the industry’s worst kept secrets over the past several years, and the data is now confirming what I think everybody was whispering about over the last several years.

Tier one inventory is getting drilled out. Tier two and tier three is really what’s left, and those simp those wells simply don’t perform perform the same as the tier one inventory did. So put it all together, what do you have? You have less activity, you have higher reinvestment rates, and you have lower well productivity. That’s a recipe for an undersupplied market and higher commodity prices.

So what does that mean for Granite Ridge? We think that means opportunity. While others are pulling back, we are investing. We focus on short cycle development with clear line of sight to returns. We underwrite to 25% IRRs, and we consistently hit those marks.

So while the industry contracts, Granite Ridge is growing by double digits. Now I wanna move on to what we do. So let me make this very simple for you because we don’t look like a traditional oil and gas company. But in in a lot of ways, we do. So our assets generate cash flow.

We have over 3,100 gross wells across the country, and that generates, in as of 02/2024, over $300,000,000 of cash flow. Now our deal engine is robust. We have a vigorous business development process. Last year, we screened over six fifty transactions, and so we have a tremendous lens into U. S.

Onshore deal flow. We allocate capital based on the highest risk adjusted rate of returns, as I said before, targeting a greater than 25% full cycle return. And then we prioritize our shareholders. We offer a fixed dividend. We’re driving significant production and cash flow growth, and we’re doing it all with conservative leverage, less than one times net debt to EBITDAX.

That’s it. It’s four steps. It’s very simple. We generate cash. We screen opportunities.

We invest with discipline, and we turn we return value. Wash, rinse, and repeat. It’s simple, but it works. Now, how do we invest? So we’ve talked about why we invest.

We talked about, how we do it, and and now, you know, very drilling down a little bit more, we have two strategies. The first strategy is operated partnerships, and the second is traditional non op. Now I wanna break this down very simply. Operated partnerships are controlled investments with proven value creators in their area of expertise. Think of it as, asset level, private equity.

We enter into asset level partnerships with these operators. We fund the majority working interest in a development project, and we retain control over the spending and the timing. Our partners operate, but we control the capital. That’s about control, and it’s about pace. It’s about timing.

Now traditional non op is different. Traditional non op are minority working interests in core areas managed by blue chip operators. If you remember the first slide, we had a number of logos on that slide of of many companies that you recognize. Now this is about diversification. It’s about taking small slices of thousands of wells across the country.

This gives us breadth, and it gives us balance. So you can think of it this way, operated partnerships gives us control, whereas non op gives us diversification. Or said even another way, operator partnerships is our growth engine and non op is our cash cow. How’s it going? So what does this look like for Granite Ridge, our track record?

I’ll show you my favorite slide. Since 02/2017, Granite Ridge has delivered a 47% compounded annual growth rate in production. Over that entire period, the company’s leverage has never exceeded one times net debt to EBITDAX. That’s extraordinary in the oil and gas sector. Many companies have grown, but they loaded up on debt.

Others stayed conservative, but they didn’t grow. Granite Ridge has done both. We have strong growth. We have disciplined leverage, and I think that’s proof that our model works. Moving on to capital efficiency.

This is a word you’re gonna hear in the oil and gas sector. It’s certainly significant to us and all of our peers. I want to demonstrate that for the last nine consecutive quarters, our development CapEx has stayed under $80,000,000 But at the same time, our production has grown at a 17% CAGR. Said another way, our production is growing faster than the capital that is required to maintain flat production. So this, we believe, is the recipe for our value creation.

That wedge between the maintenance CapEx and the actual growth is where we see the value getting created. Over time, that’s gonna compound in a significant shareholder alpha. That’s why we talk so much about capital efficiency. It’s not just a buzzword, it’s the math behind long term value creation. As we move on to Slide 11, we want to talk about consistency.

Efficiency is key, but we believe consistency matters too. Granite Ridge has invested more than $1,800,000,000 in oil and gas development over the past decade through up cycles and down cycles. And through it all, our strategy has remained the same. We keep deal sizes small, well under $10,000,000 on average, which means we don’t take concentration risk. We don’t bet the farm on one deal or one basin.

Instead, we compound results deal by deal, cycle by cycle. This is how we’ve built Granite Ridge over the past decade into what it is today. It’s disciplined. It’s repeatable investing. So let me talk a little bit more about operated partnerships.

It really is the, as I said, the growth engine for Granite Ridge as we move forward. And I want to create kind of an understanding of the backdrop as to why the company, evolved its strategy into the operated partnerships. This slide shows a significant decline in private equity fundraising for natural resources over the past decade. As you see on the left plot, their upstream private equity fundraising for natural resources has collapsed. Whereas ten years ago, they were averaging $25,000,000,000 of private equity capital raised per year.

Over the last three, it’s $8,000,000,000 of capital for the natural resources space. That’s a 70% decline in fundraising for, oil and gas development. On the right hand side, you see far fewer teams receiving private equity fundraising. And so, you know, if if ten years ago, you were averaging over a 100 management teams funded per year to capture oil and gas development opportunities, well, today, it’s less than 20. That’s an 80% decline.

That has left a significant gap in upstream oil and gas development, and we believe that, that has created a significantly compelling opportunity for operated assets, and we have stepped in to fill that gap. In our second quarter results, we announced, two of our, newest operating partners. And so we’ve been very excited to begin to demonstrate and talk about their results. We’ve partnered with Admiral Permian Resources in the Delaware Basin and Petro Legacy Energy in the Midland. With Admiral, we’ve invested nearly $180,000,000 of development capital across 38 wells and have generated right at our target return, 24% full cycle IRR.

Admiral now represents about 7,000 net BOE per day to Granite Ridge, which is approximately 22% of our total production. And they’re running a two rig drilling program with significant inventory ahead. Petrolegacy is a little bit earlier stage. They’re focused on the Northern Midland Basin, but spudding their first four wells this month with 16 more expected in 2026. Both Admiral and Petrolegacy are proof that this model works.

We provide the capital. They provide the operational expertise, and together, we’re we’re creating significant value. We’re not stopping there. We’ve recently signed two more partners, both confidential no. Sorry.

Confidential for now, but, they will be expanding their footprint also in the Permian Basin. So why does this matter? We think it’s a unique opportunity. Entry costs are compelling, returns are strong, and the competition for capital is low. This is the best environment for upstream investing that Granite Ridge has seen in years, and we’re taking advantage of it.

As I move to the next slide, this is a bit of a drill down into Admiral and Petra Legacy. You see the net locations acquired over the past four quarters. We’ve gone from 14.5 to 52 in just four quarters. Look forward to giving this presentation again in like a quarter or two, you’re going to see that continue to go up into the right. Net production in the middle, as I said, about 7,000 barrels a day, net to Granite Ridge.

Petro Legacy will begin to add production here. And so in future quarters, you’re going to see another color on this plot as we drive additional value from Petro Legacy’s efforts. So very excited about the momentum that we’re seeing from these two operators. And as I said, the two confidential partners, we look forward to making known who they are here in in subsequent quarters and and seeing their contributions as well. Now I want to be clear, we have not left the non op market.

We still believe it’s a significant opportunity for Granite Ridge. The space is a really a massive opportunity set. In 2024, about $105,000,000,000 was spent on U. S. Shale.

Roughly onefour of that was nonoperated working interest capital, which is a huge opportunity, a huge market for Granite Ridge to exploit. We continue to dedicate about 40% of our budget to non op. We evaluate deals every week, and we focus our capital in areas where we see strong returns, particularly the Delaware Basin in the Permian and the Utica Shale in Appalachia. Non op remains a core strength because it is exposure to hundreds and hundreds of wells managed by top operators, where we don’t take on any concentration risk. So we’ll continue to invest significantly in non op, but really, the growth engine, as I mentioned, remains in the operated partnerships.

So how’s it all going? How do we stack up against our peers? Granite Ridge has been public for about three years, so we’re probably one of the newer entrants on this on this chart, but we’re really pleased with how we stack up. Amongst the small cap energy universe, Granite Ridge is top quartile across return on capital employed, production growth, leverage and dividend yield. We’re only three years into being a public company, as I mentioned.

We’re really proud of this performance. We think it’s differentiated, and, the proof is in the pudding on kind of the investment thesis and the operational, efforts that we’ve undertaken. Looking at 2025, we are really shaping up to have the strongest year of our company’s history. We expect to close more than 50 deals this year, expanding our inventory by 74 net locations, which at current drilling pace is approximately three years of inventory. So we’ve seen a very robust business development pipeline.

Transactions have been very exciting and attractive for our deal engine. Our capital allocation remains consistent, about 70% to development, 30% to acquisitions, and nearly everything comes through proprietary deal channels. You’ll see in that chart on the left, our marketed deals account for less than 5% of our closed opportunities. So we have a very rigorous process and significant business development efforts across the country. And I think I’d like to point out too that no single deal contributes more than 20% of our budget.

So that means diversification and risk management all built into the overall acquisition budget. We expect in 2025 production of about 32,000 BOE per day, which is up 28% year over year on $410,000,000 of total capital. Twothree of that will go to operated partnerships with the Permian Basin, specifically the Delaware at the center of that activity. This outlook gives us confidence that Granite Ridge will continue to deliver growth, yield and value for our shareholders. So let me close with this.

Granite Ridge doesn’t look like your typical E and P company, and that is by design. We’re an investment platform built by decades of or sorry, built for scale, diversification and disciplined returns. Our diversified asset base and two pronged strategy gives us balance and a natural hedge against market volatility. And our strong balance sheet and liquidity allow us to invest through the cycles. And finally, our fixed dividend reflects our commitment to sharing value with our shareholders while we grow the asset base.

In short, I’d like to leave you with Granite Ridge, means growth, it means yield, it means value, all backed by, financial discipline. Thanks for your time. Appreciate your interest in Granite Ridge, and thank you again to three part advisers, for the opportunity to present today. With that, I’ll open the floor to questions, and thank you for your interest. Yes, sir.

You bet. You bet. So the the way the operator partnership model works is think of it as a asset level partnership with a private operator. And so we signed what’s called a JDA with them, and it’s basically a joint development agreement. We have a ROFR on basically anything that company looks at, they have to bring it to us first.

And so we go through our our traditional underwriting process. We ensure that whatever project that this company has brought to us is going to net a 25% full cycle return to Granite Ridge. And then if we agree with with them and we go out to fund that project, we’ll take anywhere from 90 to 95% of the working interest of that project. Our partner will put in the rest. And so, you know, I call it a $100,000,000 project.

That’s significant capital for our for our partners. And so we’re looking for proven management teams that have built and flipped oil and gas assets in their area of focus for private equity, typically. So they have significant of their own personal wealth to put into the project. But we’ll we’ll fund the lion’s share of it. And generally, the way it works is there’s a an ROI hurdle that once that management team or once the project has hit that ROI hurdle, they revert into a certain proportion of our majority working interest.

And we basically take that as a tranche by tranche investment cycle. So it keeps our management teams engaged, it keeps them looking for opportunities and building out inventory and and opportunities for for themselves and for Granite Ridge.

Unidentified speaker: So no other burdens other than the the land that are in the

Unidentified speaker: multi that is to be located in that way?

James Masters, Vice President of Investor Relations, Granite Ridge: Yeah. That’s correct. So it really is the working interest is where our our relationship kinda begins and ends, and so we take our proportionate percentages of of the project as does the operator, and then they back into a piece of ours once once we hit an ROI hurdle. Yes, sir.

Unidentified speaker: Thanks for taking my question. You explained so I’m not

Unidentified speaker: super familiar with how all the smaller companies operate

James Masters, Vice President of Investor Relations, Granite Ridge: here. Sure.

Unidentified speaker: Debt goes up every quarter. Is that like is that how these things work? Like, every quarter, debt goes up and up and up. Do you ever pay it down or how is that process?

James Masters, Vice President of Investor Relations, Granite Ridge: Yeah. No. It’s a good question. As I said before, you know, I’ve been in the industry for twenty years, and that’s typically been the model as debt goes up and up and up. That doesn’t usually go down.

No. But I think Granite Ridge, you know, we are investing for scale right now. So we believe that that’s kind of our number one priority is to get bigger and see some of those economies of scale. And so we’re going to continue to outspend cash flow until we get to that target leverage profile of one to 1.25 times net debt to EBITDA. And so we’re at 0.8 right now.

So we feel like we’ve got some room there. And really, we’re just going to continue to do that until we get to that level, and then we’ll probably moderate spending. But also, our cash flow is going to continue to grow pretty significantly between now and then. As far as paying back that debt, I think we’re going to feel really comfortable in that one to 1.25 time turn of leverage. And I don’t foresee us really pushing that down again.

We’ll get to that level, and we’ll stay there and live within cash flow.

Unidentified speaker: So you own the land and then you have people drill on. Is that kind of the idea?

James Masters, Vice President of Investor Relations, Granite Ridge: We lease the acreage. Yes. So you’re you’re you are acquiring leasehold. And then with our partners, they come in with the operational side of the business and run the rigs and develop the asset.

Unidentified speaker: And the partners you had on the previous slide, correct?

James Masters, Vice President of Investor Relations, Granite Ridge: I’m sorry?

Unidentified speaker: The drill, the partners you had on

James Masters, Vice President of Investor Relations, Granite Ridge: the slide.

Unidentified speaker: And then there’s a slide you had where you had like bar

Unidentified speaker: that after that?

James Masters, Vice President of Investor Relations, Granite Ridge: Yep. Yep.

Unidentified speaker: So who are those people? Like, who are

Unidentified speaker: your competitors in this?

James Masters, Vice President of Investor Relations, Granite Ridge: Yeah. Great great question. So what’s on this slide are are small and mid cap oil and gas producers. And so not I would say none of these companies have the business model that is unique to Granite Ridge. These are all generally oil and gas producers that have a a defined area of development, whether it be the Permian or the Utica or other areas.

And they’re typically the operator that are running the rigs and the frac crews to develop the oil and gas asset. That said, I will say two of the peers on this list include Northern Oil and Gas and Vitesse Energy. They’re more of

Unidentified speaker: a

James Masters, Vice President of Investor Relations, Granite Ridge: traditional nonoperated, oil and gas producer. So they, like our, one strategy, basically take, minority working interest in in projects under more established operators. And so that’s kind of their traditional business model.

Unidentified speaker: Yeah. You talked about the line of sight, the admiral deal at the petrol legacy in terms of future locations that you’re planning to drill, and then it sounds like you’re is is there a defined or life to those arrangements when they claim to flip?

James Masters, Vice President of Investor Relations, Granite Ridge: Yeah. So, good question. Admiral and Petrolegacy, are kind of in their I’d say they’re they’re still right in the middle of their business development efforts. Admiral’s strategy is to be a solution for the larger operators in the Permian Basin. So if they need to flip out of acreage or, you know, get a rig to work because they’re gonna lose a package, admiral comes in with kinda sharp elbows and and pretty commercial a pretty commercial strategy to, to secure inventory, and they’ve done a tremendous job with that.

As I as you saw on this slide, they have about 42 net locations acquired to date. As I said, you know, by the end of this year, this chart’s gonna look a lot different, you know, close to probably double this this bar on the on 06:30. So Admiral’s secured a tremendous amount of inventory. They’re running two rigs to develop that. Petro legacy is a little bit more earlier stage than Admiral, but they’re working to secure their own wedge of inventory.

As far as what’s the endgame, I think that’s the neat part of the operator partnerships model. I think every if you think of the private equity closed, you know, closed cycle fund, idea, you know, people have to sell within three to five, five to five to seven years. That’s not the way this works. At the admin at the working interest asset level perspective, Admiral owns its company. Betra Legacy owns its its company.

They don’t have a a private equity overlord telling them when to sell, even if it’s not the right time for them to sell their assets. And so if they wanna hold those assets for the next fifty years and and give them to their grandkids, they’re they’re certainly welcome to do that. If they wanna sell, you know, we and they, you know, they get a a an attractive multiple, Granite Ridge would be happy to sell alongside them. So we’re really partnered on the asset development. And as far as the corporate direction of of those companies, that’s that’s entirely up to the management teams.

Yes.

Unidentified speaker: So what is your staff consist of?

Unidentified speaker: And what expertise and value add and people like your company bring to?

James Masters, Vice President of Investor Relations, Granite Ridge: Yeah. Great great question. I’d say Granite Ridge looks very much like an operator. So you’re going to have geologists, you have engineers, you have landmen. What you don’t have is the operational element of it.

So we don’t have operations engineers. We’re not running rigs, but we are underwriting and evaluating these projects just like an oil and gas producer would. And so as I said, last year, we had six fifty deals reviewed in our kind of typical weekly process. I think the number is 1,100 since the beginning of 2024. So it’s really a deal shop that’s evaluating these projects.

And with 3,000 gross wells across the country, it’s a massive dataset to be able to look at the opportunities that come through and and be and be able to kind of run analysis and and understand, you know, what what areas are like, what areas we don’t, what what new well designs are are showing, you know, increased economics and and results. So so, yes, I I I would say our our our g and a budget looks a lot like an operator without the the operational piece. And the nice thing about that is, you know, we have the opportunity to scale really significantly without adding a lot of people. So that’s gonna stay pretty static as we grow because our our business tip truly is a deal engine, evaluator, and an allocator of capital. Yes.

Unidentified speaker: Properties that have homes and the place we have? Is there very

Unidentified speaker: many in the way

Unidentified speaker: of farmhouse where or do they actually have the lease holes in

James Masters, Vice President of Investor Relations, Granite Ridge: in hand? It’s it’s it’s both. You know, it’s I’ll say that the Delaware Basin is basically blocked up by seven major operators. And so there really isn’t a lot of opportunity to go out and and organically lease, you know, high tier one level acreage. But there is significant opportunity for, we call them special forces.

I mean, they’re really they’re in there. They have the relationships there from Midland, and they’re, like I said, have pretty sharp elbows and are are trying to make deals where, you know, maybe others that have a more of a static approach aren’t able to to do. And so they’re you know, they have a lot of relationships at Conoco and Chevron and, you know, these these big operators. And so when they need a a well drilled or a package, know, done and they just don’t have it on the drill drill schedule, admiral’s one of their first calls to figure out how they can make a trade or how they can swap into and out of, opportunities. And so really by taking singles and doubles approach, they’ve been able to aggregate a a a fairly nice, asset position to to begin to develop.

Well, that’s an outstanding point. And one of I’m really intrigued by in this current macro environment because, you know, you see a lot of these companies that have made significant acquisitions over the past five years. And frankly, a lot of them massively overstated the value and the the quality of their acreage position. There’s a there’s a clip of Scott Sheffield at Pioneer basically admitting that, you know, most of their acreage is is not is no longer tier one, it’s tier two. Only a few years after he boasted, you know, the most tier one, you know, inventory in the Permian Basin.

So as I said, that’s that’s kind of been the worst kept secret in oil and gas. And I think as we take a more of a short cycle development approach, and we’re calibrating everything to that 25% IRR full cycle. And so we can we’re in some ways happy to get into a Tier two inventory because we’ve already calibrated that entry cost. And so for us, it really is trying to find opportunities to see short cycle line of development line of sight to development calibrated at that entry cost and solve problems for these for these bigger operators that have all that inventory. I don’t know what do with it.

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