Mach Natural Resources LP

Mach reported second-quarter production of 149,000 BOE per day, with average realized prices of $95.40/bbl for oil, $1.93/Mcf for gas, and $28.99/bbl for NGLs. Oil and gas revenues were $360 million, total revenues including hedges and midstream were $406 million, adjusted EBITDA was $182 million, operating cash flow was $154 million, and lease operating expense was $98 million, or $7.21 per BOE; cash G&A was about $7 million, or $0.54 per BOE. The company ended the quarter with $41 million in cash and $270 million of credit-facility availability. Development CapEx was $97 million, or 63% of operating cash flow, and cash available for distribution was $60 million, resulting in a $0.36 per unit distribution to be paid August 31. Management did not provide next-quarter revenue or EPS guidance; instead, it reiterated a year-end leverage outlook of about 1.4x and a target of 1.0x leverage by the end of 2027, while keeping reinvestment around 50% of operating cash flow.

Tom Ward framed the company around four pillars: disciplined acquisitions, reinvestment below 50% of operating cash flow, financial strength, and maximizing distributions. He said the company intentionally accepts a variable program so it can shift quickly between oil and gas, and that 2026 spending is tilted toward Q2 and Q3 while drilling in the San Juan. His tone was confident about the long-term asset base and distributions, but more cautious on near-term natural gas pricing, saying he is “a little hesitant right now to be bullish natural gas” even while remaining constructive longer term.

Kevin White gave the quarter’s reported numbers and emphasized that capital spending stayed near the company’s reinvestment target. He said production was 149,000 BOE/d, total revenues were $406 million, adjusted EBITDA was $182 million, operating cash flow was $154 million, and cash available for distribution was $60 million, which supported the $0.36 per unit distribution. He also noted $41 million in cash, $270 million of revolving credit availability, and that year-to-date development CapEx is right around 50% of year-to-date operating cash flow.

Analysts focused on the drilling mix, the economics of Oswego, Clear Fork, and Mancos, and whether 2027 would lean more toward gas or oil. Management said the Oswego remains the “workhorse,” Clear Fork has only about eight locations and is still price-dependent, and Mancos completions are likely to wait until gas prices improve into next summer. On the balance sheet, Tom Ward acknowledged leverage is still around 1.4x at year-end under current pricing, reiterated the 1.0x goal by end-2027, and said options include the ATM program, reducing the distribution, or pursuing an accretive acquisition; he was less enthusiastic about asset sales because he does not want to give up low-decline cash flow.