DMLP

MKT CAP $1.5BP/E 17.0DIV YIELD —FCF YIELD —REV TTM —NET INCOME $87.4M +8.3%NET CASH —52W 21.26 – 30.43SEC XBRL · TTM TO Invalid Date

How DMLP rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

74%

of sentences unchanged

Added

new sentences

Dropped

sentences removed

Length

+232

words, now 15,916

New in FY2025

We do not control operations and development of the Royalty Properties or the properties underlying the NPI, which could impact the amount of our cash distributions.
Our unitholders are not able to influence or control the operation or future development of the properties underlying the NPI.
The current operators of the properties underlying the NPI are under no obligation to continue operating the underlying properties.
Portions of the Royalty Properties are unleased mineral interests.
The Operating Partnership may transfer or abandon properties that are subject to the NPI.
Our General Partner, through the Operating Partnership, may at any time transfer all or part of the properties underlying the NPI.
Our unitholders are not entitled to vote on any transfer; however, any such transfer must also simultaneously include the NPI at a corresponding price.
This could result in termination of the NPI relating to the abandoned well or property.
The cash available for distribution that comes from our royalty and mineral interests, including the NPI, is directly affected by increases in production costs and other costs.
We may experience delays in receiving royalty payments and be unable to replace operators that do not make required royalty payments, and we may not be able to terminate our leases with defaulting lessees if any of the operators on those leases declare bankruptcy.
Furthermore, the oil and natural gas industry has and continues to experience consolidation amongst some operators, which has resulted in certain instances of combined companies with larger resources.
The Operating Partnership may participate in drilling activities in limited circumstances on the properties underlying the NPI, and third parties may undertake drilling activities on our properties.
In addition, under the terms of the NPI, the costs of unsuccessful future drilling on the working interest properties that are subject to the NPI will reduce amounts payable to us under the NPI by 96.97% of these costs.
Many of these competitors have substantially greater financial flexibility and other resources than we do.
A significant portion of the properties subject to the NPI are geographically concentrated, which could cause net proceeds payable under the NPI to be impacted by regional events.
A significant portion of the properties subject to the NPI are properties located in the Bakken region and Permian Basin.
Because of this geographic concentration, any regional events, including natural disasters that increase costs, reduce availability of equipment, services, or supplies, reduce demand or limit production may impact the net proceeds payable under the NPI more than if the properties were more geographically diversified.
Under the terms of the NPI, much of the economic risk of the underlying properties is passed along to us.
Under the terms of the NPI, virtually all costs that may be incurred in connection with the properties, including overhead costs that are not subject to an annual reimbursement limit, are deducted as production costs or excess production costs in determining amounts payable to us.
If costs exceed revenues, we do not receive any payments under the NPI.
The terms of the NPI provide for excess costs that cannot be charged currently because they exceed current revenues to be accumulated and charged in future periods, which could result in us not receiving any payments under the NPI until all prior uncharged costs have been recovered by the Operating Partnership.
Any uninsured costs relating to the properties underlying the NPI will be deducted as a production cost in calculating the net proceeds payable to us.
Cyber incidents or attacks targeting our systems and infrastructure used by the oil and natural gas industry and the use of artificial intelligence tools by us, the operators of our properties, vendors, suppliers, and other business partners may adversely impact our operations, and if we are unable to obtain and maintain adequate protection of our data, our business may be adversely impacted.
Security vulnerabilities may be introduced from the use of artificial intelligence by us, the operators of our properties, vendors, suppliers, and other business partners.
As cyber security threats continue to evolve, including those leveraging the increasing availability and sophistication of artificial intelligence tools, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerability to cyber incidents.
We may not have sufficient resources available to do so on a timely basis.
It is not possible to predict all of the risks related to the use of artificial intelligence.
It is possible that our business, finances, systems and assets could be compromised in a cyber attack or from the unintended consequences of the use of artificial intelligence tools by us, the operators of our properties, vendors, suppliers, and other business partners.
In addition, new laws and regulations regarding cybersecurity and artificial intelligence may pose increasingly complex compliance challenges and potentially elevate costs, and any failure to comply with these laws and regulations could result in significant penalties and legal liability.
Global military conflicts and political uncertainty, fluctuating interest rates, changes in tariff rates, global supply chain disruptions, concerns about a potential economic downturn or recession, recent measures to combat persistent inflation, and actions taken by OPEC and its non-OPEC allies, collectively OPEC+, continued to contribute to economic and pricing volatility during 2025.
During periods of substantial declines in prices, oil and natural gas operators on our properties may suspend drilling programs, which would impact our revenues and operating income.
Continuing or worsening domestic inflationary issues and associated changes in federal monetary policy and increased tariffs by the United States on foreign jurisdictions may result in increases to the costs of the goods, services and labor used by our operators, which could cause their capital expenditures and operating costs to rise and may delay or restrict their exploration and development activities and in turn our business.
Recently, the U.S. has had periods of high inflation and increased tariffs on foreign jurisdictions.
These inflationary and tariff pressures have resulted, and may continue to result, in increases to the costs of the goods, services and labor used by our operators, which has and may continue to cause their capital expenditures and operating costs to rise.
Federal Reserve and other central banks to increase interest rates through 2025, with only slight moderation later in the year.
Sustained levels of high interest rates, combined with expectations of no further rate cuts and potential future rate increases, as well as potential volatility in monetary policy resulting from new leadership at the federal reserve, could raise the cost of capital and depress economic growth, either of which, or the combination thereof, could hurt the financial and operating results of our operators’ businesses.
Federal changes will affect state air permitting programs in states that administer the federal CAA under a delegation of authority, including states in which we have operations, and states will be required to adopt implementing plans for existing sources consistent with EPA’s emissions guidelines.
Separately, on July 4, 2025, President Trump signed the One Big Beautiful Bill Act, which amended CAA section 136(g) to delay the collection of data regarding the annual GHG emissions for oil and natural gas systems to 2034 and for each year thereafter, which may affect overall compliance timeframe.
These new standards, to the extent implemented, as well as any future laws and their implementing regulations, may require our operators to obtain pre-approval for the expansion or modification of existing facilities or the construction of new facilities expected to produce air emissions, impose stringent air permit requirements, or mandate the use of specific equipment or technologies to control emissions, and compliance timeframes may be adjusted through EPA rulemakings or state plan approvals.
On February 12, 2026, EPA announced a final rule rescinding its 2009 GHG Endangerment Finding (a regulatory determination that GHGs, specifically carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride, threaten public health and welfare), and repealing all GHG emission standards and associated compliance, testing, reporting, averaging, banking and trading provisions for light-, medium-, and heavy-duty motor vehicles and engines under section 202(a) of the CAA.

and 38 more.

Gone since FY2024

We do not control operations and development of the Royalty Properties or the properties underlying the NPIs that the Operating Partnership does not operate, which could impact the amount of our cash distributions.
Our unitholders are not able to influence or control the operation or future development of the properties underlying the NPIs.
The current operators of the properties underlying the NPIs are under no obligation to continue operating the underlying properties.
Significant portions of the Royalty Properties are unleased mineral interests.
The Operating Partnership may transfer or abandon properties that are subject to the NPIs.
Our General Partner, through the Operating Partnership, may at any time transfer all or part of the properties underlying the NPIs.
Our unitholders are not entitled to vote on any transfer; however, any such transfer must also simultaneously include the NPIs at a corresponding price.
This could result in termination of the NPIs relating to the abandoned well or property.
The cash available for distribution that comes from our royalty and mineral interests, including the NPIs, is directly affected by increases in production costs and other costs.
We may experience delays in received royalty payments and be unable to replace operators that do not make required royalty payments, and we may not be able to terminate our leases with defaulting lessees if any of the operators on those leases declare bankruptcy.
Furthermore, the oil and natural gas industry has experienced recent consolidation amongst some operators, which has resulted in certain instances of combined companies with larger resources.
The Operating Partnership may participate in drilling activities in limited circumstances on the properties underlying the NPIs, and third parties may undertake drilling activities on our properties.
In addition, under the terms of the NPIs, the costs of unsuccessful future drilling on the working interest properties that are subject to the NPIs will reduce amounts payable to us under the NPIs by 96.97% of these costs.
Many of these competitors have substantially greater financial and other resources than we do.
A significant portion of the properties subject to the NPIs are geographically concentrated, which could cause net proceeds payable under the NPIs to be impacted by regional events.
A significant portion of the properties subject to the NPIs are properties located in the Bakken region and Permian Basin.
Because of this geographic concentration, any regional events, including natural disasters that increase costs, reduce availability of equipment, services, or supplies, reduce demand or limit production may impact the net proceeds payable under the NPIs more than if the properties were more geographically diversified.
Under the terms of the NPIs, much of the economic risk of the underlying properties is passed along to us.
Under the terms of the NPIs, virtually all costs that may be incurred in connection with the properties, including overhead costs that are not subject to an annual reimbursement limit, are deducted as production costs or excess production costs in determining amounts payable to us.
If costs exceed revenues, we do not receive any payments under the NPIs.
The terms of the NPIs provide for excess costs that cannot be charged currently because they exceed current revenues to be accumulated and charged in future periods, which could result in us not receiving any payments under the NPIs until all prior uncharged costs have been recovered by the Operating Partnership.
Any uninsured costs relating to the properties underlying the NPIs will be deducted as a production cost in calculating the net proceeds payable to us.
Cyber incidents or attacks targeting our systems and infrastructure used by the oil and natural gas industry may adversely impact our operations, and if we are unable to obtain and maintain adequate protection of our data, our business may be adversely impacted.
As cyber security threats continue to evolve, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerability to cyber incidents.
It is possible that our business, finances, systems and assets could be compromised in a cyber attack.
For example, after OPEC and a group of oil producing nations led by Russia failed in March 2020 to agree on oil production cuts, Saudi Arabia announced that it would cut oil prices and increase production, leading to a sharp decline in oil and natural gas prices.
While OPEC, Russia and other oil producing countries reached an agreement in April 2020 to reduce production levels, and U.S. production declined, oil prices remained lower than in previous years on account of an oversupply of oil and natural gas, with a simultaneous decrease in demand as a result of the impact of COVID-19 on the global economy.
Thereafter, in 2021, oil and natural gas prices significantly rebounded.
However, global military conflicts, fluctuating interest rates, changes in tariff rates, global supply chain disruptions, concerns about a potential economic downturn or recession, recent measures to combat persistent inflation, and actions taken by OPEC and its non-OPEC allies, collectively OPEC+, continued to contribute to economic and pricing volatility during 2024.
During periods of substantial declines in prices, such as in 2020, oil and natural gas operators on our properties may suspend drilling programs, which would impact our revenues and operating income.
Continuing or worsening inflationary issues and associated changes in federal monetary policy may result in increases to the costs of the goods, services and labor used by our operators, which could cause their capital expenditures and operating costs to rise and may delay or restrict their exploration and development activities.
Recently, the U.S. has had periods of high inflation.
These inflationary pressures may result in increases to the costs of the goods, services and labor used by our operators, which could cause their capital expenditures and operating costs to rise.
Federal Reserve and other central banks to increase interest rates, which could have the effects of raising the cost of capital and depressing economic growth, either of which, or the combination thereof, could hurt the financial and operating results of our operators’ businesses.
Federal changes will affect state air permitting programs in states that administer the federal CAA under a delegation of authority, including states in which we have operations.
These new standards, to the extent implemented, as well as any future laws and their implementing regulations, may require our operators to obtain pre-approval for the expansion or modification of existing facilities or the construction of new facilities expected to produce air emissions, impose stringent air permit requirements, or mandate the use of specific equipment or technologies to control emissions.
In addition, on March 26, 2015, the Bureau of Land Management (“BLM”) published a final rule governing hydraulic fracturing on federal and Indian lands.
The rule requires public disclosure of chemicals used in hydraulic fracturing, implementation of a casing and cementing program, management of recovered fluids, and submission to the BLM of detailed information about the proposed operation, including wellbore geology, the location of faults and fractures, and the depths of all usable water.
Also, on November 18, 2016, the BLM finalized a rule to reduce the flaring, venting and leaking of methane from oil and natural gas operations on federal and Indian lands.
On March 28, 2017, President Trump signed an executive order directing the BLM to review the above rules and, if appropriate, to initiate a rulemaking to rescind or revise them.

and 34 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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