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LONG-TERM DEBT | 12 Months Ended
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Dec. 31, 2025
LONG-TERM DEBT. |
LONG-TERM DEBT | NOTE 8—LONG-TERM DEBT On December 16, 2025, the Partnership entered into a Second Amended and Restated Credit Agreement (the “Second A&R Credit Agreement”), which amended and restated our existing Amended and Restated Credit Agreement, dated as of June 13, 2023 (as amended on July 24, 2023, December 8, 2023, and May 1, 2025). The Second A&R Credit Agreement provides for, among other things, (i) a senior secured reserve-based revolving credit facility in an aggregate maximum principal amount of up to $1.5 billion with an initial borrowing base of $625.0 million and an initial aggregate elected commitments amount of up to $625.0 million, including a sub-facility for the issuance of letters of credit of up to $10.0 million and (ii) an extension of the maturity date of the Second A&R Credit Agreement to December 16, 2030 (provided, that if (a) any Permitted Preferred Units (as defined in the Second A&R Credit Agreement) that were outstanding on December 16, 2025 remain outstanding on May 3, 2030, and (b) Liquidity (as defined in the Second A&R Credit Agreement) would be less than 10% of the Loan Limit (as defined in the Second A&R Credit Agreement), or the Debt to EBITDAX Ratio (as defined in the Second A&R Credit Agreement) would be greater than 3.00 x, or any Borrowing Base Deficiency (as defined in the Second A&R Credit Agreement) would exist (in each case immediately after giving pro forma effect to the exercise of any put right in respect of such Permitted Preferred Units), the maturity date shall be May 3, 2030). The secured revolving credit facility bears interest at a rate equal to, at the Partnership’s election, either (a) the Secured Overnight Financing Rate (as defined in the Second A&R Credit Agreement) plus an applicable margin that varies from 2.50% to 3.50% per annum or (b) a base rate plus an applicable margin that varies from 1.50% to 2.50% per annum, based on borrowing base utilization. The secured revolving credit facility is guaranteed by certain of the Partnership’s material subsidiaries and is collateralized by substantially all assets, including the oil and natural gas properties of such subsidiaries, including mortgages on at least 75% of the PV-9 of the proved developed reserves constituting borrowing base properties as set forth on the Partnership’s most recent reserve report. The borrowing base will be based on the value of the Partnership’s and certain of its material subsidiaries’ oil and natural gas properties. The borrowing base will be redetermined semi-annually on or about May 1 and November 1 of each year by the Lenders (as defined in the Second A&R Credit Agreement), with one interim unscheduled redetermination available to each of the Partnership and a group of certain Lenders between scheduled redeterminations during each calendar year. The first scheduled redetermination will be on or around May 1, 2026. Customary borrowing base reductions and mandatory prepayments are required under the Second A&R Credit Agreement in connection with certain sales of certain types of borrowing base properties, sales of equity interests in guarantor subsidiaries owning such properties, certain debt issuances or certain types of swap terminations. In addition, Cash Balance (as defined in the Second A&R Credit Agreement) above $50.0 million and 10% of the Loan Limit is required to be applied weekly to prepay loans (without a commitment reduction) if not otherwise reduced to zero in a manner permitted by the Second A&R Credit Agreement. The Partnership is required to pay a commitment fee that varies from 0.375% to 0.50% per annum on the average daily unused portion of the current aggregate commitments under the secured revolving credit facility. The Partnership is also required to pay customary letter of credit and fronting fees. The Second A&R Credit Agreement requires the Partnership to maintain as of the last day of each fiscal quarter: (i) a Debt to EBITDAX Ratio (as defined in the Second A&R Credit Agreement) of not more than 3.5 to 1.0 and (ii) a ratio of current assets to current liabilities of not less than 1.0 to 1.0, calculated at the end of each fiscal quarter. The Second A&R Credit Agreement also contains customary affirmative and negative covenants, including, among other things, as to compliance with laws (including environmental laws and anti-corruption laws), delivery of quarterly and annual financial statements and borrowing base certificates, conduct of business, maintenance of property, maintenance of insurance, entry into certain derivatives contracts, restrictions on the incurrence of liens, indebtedness, asset dispositions, restricted payments, and other customary covenants. These covenants are subject to a number of limitations and exceptions. Additionally, the Second A&R Credit Agreement contains customary events of default and remedies for credit facilities of this nature. If the Partnership does not comply with the financial and other covenants in the Second A&R Credit Agreement, the Lenders may, subject to customary cure rights, require immediate payment of all amounts outstanding under the Second A&R Credit Agreement and any outstanding unfunded commitments may be terminated. During the year ended December 31, 2025, the Partnership borrowed an additional $695.6 million under the secured revolving credit facility and repaid approximately $493.3 million of the outstanding borrowings. As of December 31, 2025, the Partnership’s outstanding balance was $441.5 million and there were no outstanding letters of credit under the secured revolving credit facility. The Partnership was in compliance with all covenants included in the secured revolving credit facility as of December 31, 2025. As of December 31, 2025, borrowings under the secured revolving credit facility bore interest at SOFR plus a margin of 3.00% or the ABR (as defined in the Second A&R Credit Agreement) plus a margin of 2.00%. For the year ended December 31, 2025, the weighted average interest rate on the Partnership’s outstanding borrowings was 7.57%.

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