OIL AND NATURAL GAS PROPERTIES |
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Jun. 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| OIL AND NATURAL GAS PROPERTIES | NOTE 7—OIL AND NATURAL GAS PROPERTIES Oil and natural gas properties consist of the following:
The net capitalized costs of proved oil and natural gas properties are subject to a full-cost ceiling limitation for which the costs are not allowed to exceed their related estimated future net revenues discounted at 10%. Unevaluated properties are assessed on a periodic basis for possible impairment based on the following factors, among others: economic and market conditions, operators’ intent to drill, remaining lease term, geological and geophysical evaluations, operators’ drilling results and activity, the assignment of proved reserves and the economic viability of operator development if proved reserves are assigned. Costs associated with unevaluated properties are excluded from the full cost pool until a determination as to the existence of proved developed reserves is able to be made. During any period in which these factors indicate an impairment, all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to amortization and to the full-cost ceiling test. The Partnership did not record an impairment on its oil and natural gas properties for the three and six months ended June 30, 2026 and 2025. Depletion expense for the three months ended June 30, 2026 and 2025 was $30.2 million and $30.4 million, respectively, and the average depletion rate per barrel was $12.84 and $13.16, respectively. Depletion expense for the six months ended June 30, 2026 and 2025 was $59.4 million and $61.4 million, respectively, and the average depletion rate per barrel was $12.79 and $13.34, respectively. |
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