LandBridge Company LLC ($LB)

Welcome, everybody. We're excited for our inaugural Analyst Day. We hope this will be informative, and we're take you through a pretty full agenda. We want to make sure it's interactive. So if you have questions, by all means, raise your hand, speak up, shake your head, do something like that, and we'll find you. So with that, the first thing we're going to do is we're going to run a video to start. [Presentation]

It was a little funny to see yourself on screen. But anyway, we are excited. I'm going to introduce our speakers today. To my right, I have Jason Long, the CEO of Land Bridge. To my -- to his right, we have Scott McNeely, the CFO of Land bridge. I have Isaac Ramirez, who's going to take us through a lot of the digital infrastructure play that's associated with Landbridge and we have Alex Hernandez, who is the CEO of Power Bridge. Prior to PowerBridge, he was CEO of Talend and the founder and CEO of Cumulus. Cumulus is today the only 1.1-gigawatt behind the meter data center complex ever built and completed. And it was completed in Barwick, Pennsylvania. It was the -- it was effectively step 1 of what Borrowed Pennsylvania has become today, which is the largest data center market in the world. And we're going to hear a lot of -- or at least North America. We're going to hear a lot about why West Texas has a lot of the same attributes Alex saw in Burwood, Pennsylvania and is why he's with us today. And me, I'm David Capobianco if he hadn't put that together yet. I am the Chairman of the Board of Landbridge and the CEO and Founder of Five Point Infrastructure. I'll take you through a little bit of who FivePoint is, how our ecosystem creates value throughout the value chain with Landbridge as the vortex of that value creation -- and we'll talk a little more about some of the direct value drivers for Landbridge over the next decade. First of all, for Five Point, I founded in based in Houston, Texas with the idea that we would build strategically important businesses. And for us, that meant leaders in our target areas. Today, we have over $7 billion under management. and we focused on 4 core themes. Those include environmental water management, WaterBridge is the poster child for that. sustainable infrastructure. We'll talk a little bit about a business we built and sold North Wind and how it has the analogy, the things we'll do in the future. Surface management poster child is land bridge, that's what we're here to talk about today and digital infrastructure. And PowerBridge and other parts of our portfolio will capitalize on all of the value of the ecosystem to create and drive additional value to Land bridge. So as always, it's sort of like a crutch. As always, for me, I'm going to take you through a GIS platform demonstration which will enable you to better understand exactly how our ecosystem works, what it is and how it drives value across the portfolio. I'm actually going to stand next to it, so I can see the screen, and I can look at my man, Matt Bailey, when I was introducing people, I should have introduced Matt. Matt, the Head of IT and GIS at Five Point, he's the 1 who created this system. Today, the system that has 30 billion data points and 0.5 million lines of code. So it is the brain center of Five Point. We utilize it throughout all of our portfolio companies in the whole ecosystem, and it gives us superior knowledge to our competitors. So the first thing I'll do is I'll get into a little bit of the ecosystem. What you see here on the map for those, just to situate , this is a Texas, New Mexico border. You see in green, we have the Delaware Basin, and that also encompasses the pink landing strip there. In the blue in the middle, we have the Central Basin platform. And on the right, we have the Midland Basin. So today, we're going to focus on our Five Point ecosystem in the Delaware Basin. So the first thing you'll notice in the Charcoal boxes is Land bridges acreage, 317,000 highly strategic acreage that hugs the New York, the Texas, New Mexico border and also has some southern acreage and some acreage in New Mexico that's really valuable. So obviously, the first piece in the vortex of the ecosystem. But the next piece is water bridge. And our water bridge water infrastructure, you can see goes throughout the basin and obviously drives value to land by the water we manage, the damages we pay and the water that gets drawn from Landbridge to customers as well. The next piece of the ecosystem that's interesting and, by the way, part of WaterBridge is Desert environmental. Desert Environmental to give you a sense for how the ecosystem works is, here we are with the land and the surface and we recognize that we have a waste product that needs to find a home. And we realized that we ourselves could create a business to manage that waste and get an acceptable return, but that we also knew all of our customers would want to use that as well. So we started this business. It's an incredible little piece of Water bridge, but it's a waste management business that initially started with rig WaterBridge's waste on land bridge areas and pays land bridge, a per ton fee and a fee for a lease and a fee for the damages that created. And then it also manages that same waste for our customers. again, another piece of the puzzle. And to keep showing you how this ecosystem works, we built a business called North Wind Midstream in the sour gas window. So this business didn't actually have an opportunity to put infrastructure yet on Landbridge because we sold it before we get to that point. But ultimately, we will put sour gas infrastructure on Landbridge as well. But what this did is it unlocked development in the sour gas window of the Northern Delaware. Really show them the development inside and outside the window, but it was about 3:1 and the trends extend directly. The only difference is when you produce the oil in the sour gas window, you end up with high CO2 and high sulfur and that high CO2 and sulfur has to be managed. We created a solution here because we wanted our customers who in the middle of our ecosystem of water and land, we wanted our customers to exploit their resource, bring more water to our surface and enable WaterBridge to manage that water. And that's how North Wind fit in. We were fortunate to have sold that business to MPLX, who's developing it and continuing to deploy capital in it. And that will serve our ecosystem very well. The next piece of the ecosystem that we'll -- you'll hear a lot about today is Power Bridge. So Power Bridge is Alex's business that's focused on creating gigawatt scale campuses on land bridge acreage in the Delaware. So Bailey, put up our locations, so we've identified 8 locations, really 5 initial targeted locations. And in these locations, we have Phase I and Phase II in the locations where we'll be able to get to 2 gigawatts. And each one of them is easily expandable to 3 gigawatts. So how will this work? Well, First of all, it will drive water management revenues because we have both water needs from that LandBridge and WaterBridge will both meet. It will create a great opportunity for land bridges from a lease perspective and a royalty perspective. We'll ultimately need some carbon sequestration for the CO2 that comes off the power plants and we'll build a network to do that, and we'll utilize land bridge surface for that. And then 2 additional portfolio companies for the future. And these companies will also contribute to the ecosystem in a really exciting way. So next business -- the next 2 businesses that are in various stages of development, and will be built out over time. The first is a fiber ring. So Bailey queue up all the fiber that we estimate the estimated fiber locations. So throughout Texas, you have fiber connectivity that's sufficient for Internet capacity needs. But it's really like running on country roads, driving on a country road to get from one place to another. There are no super highways. We are going to build the first super highway for connectivity in a fiber ring around our surface. So where we are today, we've identified and achieved a significant portion of the right of ways, and we'll begin laying conduit, and ultimately, we'll sell the ability to pull fiber to hyperscalers. But what this will do is it will create a network hub with super highway connectivity to important end markets, going to Odessa Midland and ultimately on to Dallas. Albuquerque is an important one. And then ultimately up into Denver and El Paso, which will give you connectivity to California and New Mexico. A fiber ring where the center ring circulates our target areas for our data centers, our first 5 targets. The next portfolio company we've already begun working with is a gas gathering header system, with a massive storage complex, much of which will be on land bridge acreage, but some of which will also be off. We envision being able to build up to 100 billion cubic feet of storage in the center of the Delaware Basin. And you might say, okay, that's pretty interesting, but what would you use it for? Well, a couple of cool facts is the star of the Bailey put up, he likes to lead me if I get distracted. The star he just put up is the Waha hub. So at Waha, we -- in the last month or 2, we've seen negative $20 gas. We get negative gas prices frequently. And on average, it's a very meaningful discount to Henry Hub. So what we will do is we will create a gas gathering and storage facility on the cheap side of Waha. Once you're after Waha, you're already on a long haul pipe and you're already getting priced off your end market. But before we've got constraints. We've got constraints that lead to flaring, shut in and paying people to take your gas. This facility will effectively create an opportunity to give additional Five 9s reliability to data centers. It will enable data centers to be able to say, "Okay, well, I'm going to need 250,000 -- 250 million cubic feet a day for our power plant, we're going to be able to lock up 100 days of gas storage volumes in the event there's some sort of breakdown in the transportation network, we can still run for the next 100 days, security and that volatility will create an incredibly valuable opportunity for my investors who participate in it. And we will put some of our facilities and a lot of our pipe on our surface at Landbridge where you pay damages and you pay royalties. So that's the exciting ecosystem of value drivers that we envision for LandBridge acreage. And you can see LandBridge is at the core of all of that. All of these businesses drive value to LandBridge. Okay. Let's take the fiber off and you can remove the fiber. Remove everything actually accept our data centers, our water and our surface. The next thing I wanted to point out is what the ecosystem can mean because that's all theoretical. What can the ecosystem mean for LandBridge? So I'm going to go back through something we did in the roadshow where we talked about the poor base capacity, how that capacity could get utilized and what that meant for LandBridge. So let's go around the horn Bailey. We have about 5 million barrels a day of excess port base capacity, if you include hangwe've got over 1 million of access. If you go to frying pan, we've got $2.2 million and then about $1.5 million up at Speedway, and we're always adding additional acreage that has more port space. But what this is, is based on a long-term sustainable strategy of putting a well in a square mile or a well per section in acreage that's already been vetted for issues like vertical wells, no and like faulting. We have the ability to add 5 million additional barrels a day of management capacity on Landbridge and at $0.15 a barrel that implies plus some skim that you get credit for. That implies a $300 million -- yes, $300 million of free cash flow for Landbridge. So over the next 5 years, as we exploit that poor space, you'll have another $300 million of free cash flow. Well, how does it get exploited? First of all, I'm going to take you through how the state line is losing about 2 million barrels a day over the next decade of capacity. Bailey, let's start in 2017 with the poor pressure. And then let's go from 2017 all the way to '25, and let's show how the state line get pressured up from a port base perspective. So 2017, you can see some hotspots coming out where it's actually -- you're starting to see pressure. Go to 2018, 2019, 2020, you can see the hotspots growing and getting and deepening in their redness. And then if you go all the way to 2025, you can see how we have a situation where we have overpressured hotspots at the state line. Now Bailey quickly put up the ownership of the Stateline to show why that happened. Because this is really instructive and this is 1 of the reasons our acreage is more strategic. The acreage is all blocked up between about 5 owners across the state line. So if you're a water management company, when you cross the state line you basically move your water to the first location and try to put as much as many of your facilities as you can right there in that location because if you cross 2 landowners, the economics are destroyed. I know this group knows this, but just to remind you, managing water in New Mexico is challenging from a regulatory regime. It's volatile, and long-term E&Ps don't view that as a long-term solution. So if you want to win long-term business, you need to demonstrate a solution that takes water out of New Mexico to Texas. So remove the ownership, and you can see the Stateline will lose approximately 2 million barrels a day over the next decade. We've got from B3 a really basic analysis of how much water they anticipate needing at a pretty modest oil growth rate in New Mexico. So we just -- we use their estimates, we could show you our own, but it's just as good to use theirs. They assume you'll need another 6 million barrels a day of poor space capacity. So $6 million from the growth of water. And again, the growth goes because you have higher water oil ratios over time and the new benches that are being exploited have higher water to oil ratios as well. And then you lose 2 million barrels here which effectively leaves you with the need for 8 million barrels a day of storage. So there's a high probability of success rate for us with the most strategically located option to manage some of that $8 million. And we're excited about that. You can -- in your mind, you can think of as a $300 million free cash flow opportunity. Let's talk about the data centers. If that poor space utilization is a next 5-year configuration, the data center opportunity is over the next 3 to 10 years. which is cool because it gives you a whole another cascade of opportunities on the other side of this. And what it is, is if you look at why don't you pull up our Alpha digital campus Bailey. In Alpha Digital, effectively and I should caveat it that our contracts are not fully negotiated. So I'm going to use broad ranges to be instructive. But in Alpha Digital Campus, we have Phase I and Phase II and it will enable us to put 2 gigawatts of data centers and associated power here in and this is a zoom in of what we're planning. And there is a Phase III, which enabled you to get to 3. And all of our targets have that. Basically, for a 1,500 acre lease for 1 gigawatt. Let's just use rough numbers like 3,000 to 4,000 a day. We'll take the low end, $4.5 million a year lease. And then the expected royalty rate will get you another $15 million -- $10 million to $15 million or so on that lease. And you're talking roughly and I'm not trying to make news of these numbers because we obviously haven't negotiated final deals, but you can assume per gigawatt before water, $10 million to $20 million of free cash flow to Landbridge. So our 5 gigawatt -- our 5 target campuses go back to the campuses Bailey, we'll get to approximately 3 gigawatts each, which will enable you to have 15 gigawatts and you're talking about $150 million to $300 million of free cash flow before water and water is a very big part. You're going to hear a lot about water. Damages will be a very big part. You're going to hear a lot about damages. You're going to have all other sorts of infrastructure built around these things. I'm just literally talking about the very specific Power Land campus and the revenue stream. So if you think about -- all right, if we have $300 million of upside on the poor space, growing all the time every time we do an acquisition, $100 million, $150 million to $200 million more on the data center program just with our ecosystem. And by the way, you're going to hear a lot about what Landbridge is doing outside of Power Bridge. You can look at it and say, those are 2 real revenue drivers for the next decade, and it's exciting, and it's something we're really looking forward to exploiting for you. After each section, we'll pause for questions. I don't know if anyone has a question on that presentation. But if you do, by all means, raise your hand and roll it out. Otherwise, I will -- Yes.

Brian Engler finer asset. When you think about that $300 million of free cash flow of the water capacity -- is that -- are you thinking down on pricing today, pricing that you're thinking that's not inclusive of what you're thinking comes from to the pricing you're getting on Speedway or so the market

It's a great question. There's 2 pieces of pricing growth. There's one, which is just the inflation adjustment that's in the contracts. But there's another which I probably should have mentioned, and I appreciate you bringing up, which is scarce could never go to zero. They just get priced higher and higher and higher, and that's what you'll see. So no, those numbers are literally based on $0.15 increment scheme. So yes, you can absolutely expect price over time.

Yes. I don't want to jump the gun, but go ahead the water opportunity per gigawatt for data centers.

I'm sorry.

What's the water opportunity per gigawatt.

All right. Great question. We'll get into it. It can be up to 300,000 barrels a day which is an enormous opportunity from a returns perspective.

And these are not like closed loop as you continuously need 300,000 barrels a day or so.

Not in close, that would be open loop. Again, I love stealing a thunder of my guys, but the punchline on water cooling is there are very, very few places in the whole country where you can even contemplate open loop cooling. So most places look at closed loop, which is a fraction of that 15% -- 10% to 15% of that number and air cooling, which is less still. The catch is, you need a lot more power to do that. But site in your data center outside of Dallas and tell them you use a pallet you're going to take 300,000 barrels a day and see what answer you get. That's why West Texas is such a great location. We have that water. We have that water from WaterBridge to desalinate and deliver, and we have an enormous resource of water at Landbridge.

Question for you as you build this out is just coming from a real estate perspective. Do you need everything to happen in a certain time line? Or because these large-scale developments always have ups and downs, things that don't end up getting built. -- like you can do parts of that -- I'm just trying to figure out how much of this is upfront cost that has to be built out before you can generate any positive cash flow versus you can segment this out into pieces. -- so that it's sort of tranchable projects?

Well, so let's talk about that. So first of all, WaterBridge is already driving value because other of WaterBridge's competitors are driving value to utilize that poor space. So that poor space is on a collision course to be utilized, and that's why we're already very focused on acquiring more poor space. So that's the poor space piece. Think about the fiber piece. If all we did were the fiber, it makes the whole area that much more valuable. That's the only thing we did. If all we did was create a header system and a giant storage facility, again, it makes everything more valuable. If you did either of those it's fine because the opportunity is coming either way.

Your point is not a lot of upfront infrastructure cost that give required kind of capital upfront with revenue basically, what you're talking about is each thing that you're contemplating building has revenue immediately tied with it?

That's right. And that has -- that stuff is staggered over the next decade. But we're trying to give you a view of the excitement around what the long-term picture can be. And by the way, I took you through our ecosystem and really 2 revenue streams. We're going to talk today about multiple more revenue streams and why those are just the 2 that are controllable by me at Five Point and our investable capital. And since we're broadcasting this to a wider audience, I think 1 point of clarification is probably helpful. When we think through the capital that's being spent for this, none of this is being spent by LandBridge. The capital for water infrastructure is being built by water operators, the capital for the fibering, David walk-throughs being spent by PowerBridge. On the land bridge side, we are certainly the beneficiaries though, all of that activity and when those assets come online, from the fiber ring perspective, all we're doing is further bolstering Lambert's competitive positioning to win those data center opportunities.

That's exactly right, Scott, and the gas gathering and storage is a 5-point project, and we'll spend the capital -- and that's the power of the ecosystem where the capital doesn't get spent by Landbridge but as the vortex of that ecosystem, the value does accrue to Land bridge.

The only thing I would add to that is I think this is part of your question, but a lot of this is we're stepping into these revenues as projects start, right? So the lease payments start immediately. -- all the damages as it relates to the construction start immediately. So you start to see that revenue come in, even though these are huge long capital projects, we'll start to see the revenue come in sooner than that.

Great point. With Bernie, he's got to have a question.

The day is going to be a lot shorter.

Jason, I'm using the fisherman I was asked to describe your business in a single sentence, and I said you're basically arbitraging seismic activity. could you elaborate on that? And as you're going back through the map just give...

So we don't like to think of it as arbitraging seismic activity. We like to think of it as enabling infrastructure development, enabling energy, infrastructure, enabling water structure, renewable and digital. And if you look at how we do it and what we do, it's exactly that. Are there some arbitrages in there? Like is it a good thing for us that New Mexico is as difficult as they are, yes. Is it good that they've been volatile because nobody will ever trust New Mexico to give a long-term stable regime to manage water there. So there are some dynamics that work very well for us. But the big picture is we enable infrastructure development across the board.

Talk about the timing on when the construction for the fiber ring in the gas storage will be complete?

Sure. So we have spent the last year getting right of way. We will begin laying conduit, -- and then we will get some will get customer contracted customers to pull their own fiber. Effectively, you split the conduit into kind of 4 separate areas and you sell off quadrants. And enable people to pull their own fiber and to own that quadrant. So I mean it's not on the critical path for our development. So we would expect it to be done over the next couple of years unless it gets delayed. And then for gas storage, there's a -- I don't want to get too much into this because I love this business, and it's very exciting and easy to go down a rat hole on it. but there are enormous amounts of depleted reservoir opportunities, as you can imagine. And the way you build a gas storage facility is you buy gas and inject it into depleted reservoirs to the point where it pressures up to enable you to deliver or extract that gas at the pace you want to. Normally, that's the highest cost of the biggest large chunk of depleted reservoir storage is that base gas that you have to inject in, not so when people pay you to take it. The second kind of gas is underlying -- or storage is underlying our surface at Landbridge we have a really unique structure of embedded salt [indiscernible] salt- there's 2 types of saline I'm for sure, getting outside of my geophysical capabilities. But there's basically 2 types of salt. There's a salt seam and then there's domes that get created. There are salt seems underlying our acreage at Wolfbone at 50,000 acreage. So basically, you can create a little hot dog shape salt storage facilities. And they're small, there may be 1 can make a lot of them. and those can be super high turn and again, capitalize on really attractive gas to start. So basically, what we have the ability to do is create an in-basin need to hold that gas and deploy it when it becomes optimal. And the natural question is always okay, but it's not always going to be free, and it won't. It won't always be it's not always free now, but it will always be at a discount to the other side of Waha because you don't have to put it on a long-haul pipe to get to an end market. will be in base and it will always be cheaper than an outside markets for as long as you can envision. I mean, yes, there are scenarios where in-basin demand exceeds out of basin demand. But by that point, to impact 20 Bcf of gas, we're way, way down the road, and we don't have to worry about it. So 2 types of storage facilities, no storage facilities will pay damages will we'll pay lease rates and we'll pay royalties to Land bridge.

Are there any other storage facility using those depleted reservoirs in this area? Or are you kind of.

Bailey, pull up the chart. This is the greatest chart. So historically, the there's been very, very little storage added and so much so that the chart I'm looking for Vale, so much so that as oil as gas production has grown, it actually -- so that's the volatility. There you go. So on the top, you can see gas production growth. And on the bottom, you can see days of storage. This is the only basin in North America that has this little storage relative to the gas production. At Five Point, we have Three executives who built very substantial gas storage business. And we've looked at gas storage for the last decade. We couldn't make sense of it. We couldn't -- it wouldn't meet our return hurdles until now. This is an extraordinary opportunity. And this can ultimately be a game changer for the way gas is utilized in basin.

Right. So was that all depleted reservoir stuff?

Yes.

It is -- is anyone done. And so that's like a turn once a year kind of thing or maybe a couple of times a year.

Well, so That's the big question. Typically, it's a 1 turn -- typically, you run depleted reservoir facilities at 1 turn -- the reason you do is you want to minimize the amount of base gas you use. If you pressure them up, you can get more turns -- so imagine, instead of using 25% to 30% base gas, use 50% to 60% base gas. So you can get up to 3 or 4 turns. And it's been done in California where they really needed a high-turn facility, but there are no salt structures. So we can achieve whatever we want there. If you're doing it at a time when they're paying you to take your gas?

Yes. months.

I think the cool part, just to reimpose what David said, is that the geological structures that exist at Waha for storage exists on our surface and have not been exploited, which, yes.

If there's nothing else, I'll turn it over to Scott and we'll start rocking and rolling through the presentation.

Yes. Thank Thanks, Dave. Thanks, everyone, joining us today for what it's worth when we put this on the calendar, we thought it would be a slow period in the market. So jokes -- we'll work through the slide here -- the slides here in the presentation here. I hope there's a lot that you all can take away. I mean, ultimately, what we're trying to convey here just kind of 3 key points, right? We want to talk to our asset base, really why it is so special. And ultimately, how do we take that asset base, how do we apply our active land management strategy and how do we really drive the kind of activity and commercial results that you would want to see? And then ultimately from your seats, how does that result in shareholder returns. So just a few slides before we get into macro. We try to be thoughtful about how to ultimately capture the development activity in West Texas and New Mexico. We looked at rigs. We looked at drilling. We thought that only captured pieces of the puzzle. And I think kudos to the team here as well as to Matt Bailey on the GIS side, is a really creative way to show what's really been transpiring over the last decade. So what we're showing you here is kind of a unique view of how to measure activity. And this is using light levels measured from space. And so what we see here over the last decade is that this activity, this industrial activity in West Texas and New Mexico, it isn't coming, it's already been happening. And you can kind of see just how robust it's been and how much it's grown over the last decade. And with the point we're at now, this is accelerating rapidly, which is incredibly exciting for us. if you kind of ask yourself how we capitalize on the growth to date and you flip to the next slide, we walk through briefly just what is the history of Landbridge in. If you recall, we've made just kind of a few big bets kind of through the lifetime of our company here. And the first actually predated land bridges with WaterBridge. We made a bet, we made a call that water was going to transition from a services company to an infrastructure company. This had to happen if the growth in the Delaware Basin was going to occur like everyone thought and everyone said it was going to. That ultimately led to us building out WaterBridge. That went very well, 2017, 2018, 2019, a massive growth ramp. But we made the next identification in the next call, which is surface and subsurface is going to be a critical enabler, not just for water to continue to ramp in the Delaware Basin. When we came out and we talked through port space initially, even up to our IPO, we were met with glassy eyes, a lot of folks thinking we're trying to sell them snake oil because it just wasn't really a mainstream narrative yet at that point. But I think to the benefit or to the kudos to our operations team, our engineering team and our geology team, they recognize that folks were doing this wrong. If we were going to scale WaterBridge, we had to be thoughtful and do it differently. That was ultimately the catalyzing observation that led to us starting land bridge in late 2021. We wanted to give WaterBridge the runway it needed to build its infrastructure, have access to the poor space and do it in a way that provides the flow assurance, the longevity that not just our shareholders are looking for what our customers are looking for. We made that call. Clearly, that's been validated. It's a mainstream narrative. David walked through all of the details of where we sit with that today. But what that really left us with was a great land position and option value that comes with that surface in addition to poor space. When we started to reap those benefits very quickly. We started to see the demand on the port space itself from third parties such as Devon. We also started to see the demand from other kind of industrial infrastructure, whether that was sand mines, whether that was solar, and became very obvious to us that this was going to be high demand outside of this initial surface position and that this was scalable so long as we can continue to find the right surface in the right areas that have been underutilized historically and that we felt we could apply our active land management strategy and grow value. It's kind of through that effort that we identified, what I'll call is our third call, which is data center inevitability in West Texas is absolutely a fact. We made this call in 2023, similar to the poor space call, the first time we stepped out to say it, we were met with glasses, folks saying there's no way that this is going to be true -- here we are 3 years later, it is again a mainstream narrative that everyone is talking about. There are a number of counterparties looking at it. And again, I think we put ourselves in full position to be one of the first, if not the first, to get it across the finish line here. So if you go to 12, how do we look -- we have all this business, all this activity, what does this look like relative to the rest of the market, the rest of the peers. And I think we acknowledge there are no perfect comps out there, no perfect peers out there. That is One of the things that gives us this massive advantage in terms of the market as we were thought leaders, we were one of the first people to step out and do this intentionally. And it's put us in a great position commercially, but it does require I think a little bit more effort on our side to continue to communicate what it is we're doing and how to think about it. So when you look at just the closest comp sets we had here, I would really just point to 3 main facts to keep in mind as you work through the list. The first the de minimis capital program of our business because, again, we're not deploying capital, we're not doing operating. We're only acquiring and commercializing surface leads to an incredibly high free cash flow margins. And we'll go into more detail on that in later slides. The second is once you own that surface, if it is under commercialized, there is a massive, massive growth potential that we're able to exploit, and it's that option value that comes with owning service that, again, we'll go into more detail with. But being able to drive that growth is incredibly unique particularly on a capital-light or free basis relative to a lot of the comps or the peers here. And finally, being able to achieve this kind of growth with that direct commodity price exposure is incredibly unique, not just within oil and gas, but if you zoom out and I look at a lot of these other kind of similar comps here. And so where does all this shake out in an actual performance basis, we try to capture that in the next slide here. And you've seen a similar version of this material before. We've reworked it here, but ultimately, what we're trying to demonstrate here is that the true growth, the true compounding nature of this business model over time. And so we've worked through from 2022, the first full year of Landbridge through last year, 2025, what is our EBITDA growth and our free cash flow growth look like relative to all of those comps. All of those REITs, all of those land management companies, some of our core peers within the oil and gas space, and I think this tells just such a powerful story. You look at 63% adjusted EBITDA growth, you look at free cash flow growth, touching 100% on a CAGR basis from 22% to 25%, while maintaining free cash flow margins between 60% and 70%. That is something that is very tough, if not impossible, to find outside of businesses like ours and there are not many of us out there. So where does all this cash flow come from? How is it that we're ultimately actioning this growth? This is just a really helpful snapshot of just some of the activity we see in our surface we're pursuing on our surface today. we're going to get into more detail on this, so I'm not going to go into this slide in much depth here. But ultimately, there is a lot for us to do. And again, there's more just beyond that. So wrapping up a couple of other slides here. This concept of surface use economic efficiency. We continue to emphasize this at the end of every year. A question we get quite frequently is -- how are you actually driving value? Are you just buying cash flow? Or does this active land management strategy actually work? Does it mean something? And this is the metric that we use to show that it absolutely works and is a very, very powerful, so what we're doing is we're seeing each acquisition, each land purchase, let's look at it on a vintage basis by year. And let's just measure how much nonmineral revenue we can generate on a per acre basis and the progression of that year-over-year. And what we're showing you here is 2024 to 2025, and you can see the acquisitions that we worked through in 2024 versus 2025 saw nearly 150% increase year-over-year when we bought it to the first year that we managed it. And I think that's just a great reflection, again, the active land management strategy and the results of that. We're going to break that down in more detail later in the deck, but it's this concept that I want you to keep in mind as we talk through the macro backdrop and the commercial opportunity set. So another question we get, and this is partially a technical point, but partially, I think, a really critical point from the seat of investors is how is management compensated? how do your interest align with ours. And so the point I'll make first is we as management own over 13% of the combined company. We are incredibly incentivized for this to continue to go well. Now some folks always ask it doesn't show up on Bloomberg. How is that the case? So we try to break that up in a bit more detail here because there is direct indirect ownership. And when we're making efforts to clarify that and be very transparent on that, the point I make is our economic interest today is greater than 13%, very critical. Now the technical point I'd flag, and this comes up a lot is, hey, Scott, I look at your financials, stock-based compensation is ridiculously high. You guys are way overpaid. The point I would make is more than 80% of that stock compensation expense that are in our financials are a result of the technical recognition of those incentive units that exist at the private company. So said differently, all of that 80-plus percent of stock comp can never be a cash burden to public investors nor can it ever be dilutive to the ownership of public investors. The RSU piece, very vanilla. We called that out in the financials. But the bulk of the ownership of that 13% comes from that private company side. And again, what you're seeing in the financials is gap necessitating us show that, but again, can never be a cash burden to investors, can never be dilutive to investors. So quickly wrapping up on '17. David touched on this quite a bit. But as you know, we also manage a company called WaterBridge. There are enormous synergies that exist between the 2. We try to capture that here. We've spoken to this in a lot of detail, so I won't belabor the point. But we do think that ultimately, Landbridge is the enabler for WaterBridge growth and in turn, Landbridge gets the benefit of those royalty streams WaterBridge. So moving on to macro. Just before I hand it over to Jason here. we've outlined this on calls before, but what we're going to try to do during the presentation is to break down in a bit more detail. The different growth drivers, how we think about that, the macro tailwinds we have and ultimately, how does that translate into cash flow streams for the business. Now I've said it before, there are a few ways to think about growth here. There are the short-term growth drivers, and that is going to be oil and gas-driven activity that's going to be water that is going to be all of the activities associated with that. Those are quick to action quick recognizable cash flow streams and very impactful and we've seen the benefit of that accrue to us over the last several years, and we expect that to hold here going forward. Now taking a step into kind of more of the medium term for is years out or so, those are a lot of these announcements that we've had coming to fruition. So that's going to be solar. That's going to be power -- that's going to be a lot of these projects that just by nature of the project have a longer runway, but have been contracted today, and we expect to come online over the next several years. But it's important that we continue to work on those commercial efforts now, so we have that compounding growth and we're not chasing ourselves in the future. Finally, long-term growth drivers, that's digital infrastructure. That's the larger power projects. That's a lot of these just longer lead time items that, again, as we think through the goal of creating year-over-year compounding growth, we need to action those commercial opportunities today get them in the pipeline, get them going. So in 5 to 10 years from now, all of these projects are coming online and adding to the cash flow streams that we're getting here over the near to medium term. So with that, I will hand it over to Jason.

So next couple of slides, we're just going to talk to the Delaware Basin, wire in the Delaware Basin. The obvious points out there that buy the Delaware Basin is the best place to be on. So on this slide, just a reminder that the Delaware Basin has got the lowest breakevens in the Lower 48. Obviously, also has the lowest -- I mean the highest inventory, the low 48 as well. So we feel really comfortable about where we're at, as we move through that, we're going to talk through water oil ratios on this next slide. This is a good slide because if you think about this with a modest oil growth, you're going to see it at a minimum increase in water growth. And there's a couple of drivers behind that. And we'll go into a little more detail, but when we talk about the water ratios and deeper benches. But if you look at this graph on the right, what also is happening is just with existing wells with PDP, old wells, the water growth is growing while the oil growth is declining. So you just -- you constantly see that in formations with water-driven formations. So it's a dynamic that a lot of people don't really think about, but we're constantly growing just at a PDP level. Flipping to the next slide here. This is a great graph showing shallow formations to the deeper formations. We continue to see inventory grows, operators test new benches and the majority of those are going to have higher water-to-oil ratios. As more and more of these things are tested and trued up, we're going to continue to see that grow. And David talked about that that growth we're going to see of 8 million to 10 million barrels a day, we're in a really good spot to take that. So Slide 24, I think, is extremely important. Basically, what we're showing here is that there's 4x more water produced than there is an actual demand for completions. So there's other companies that talk about recycling and reuse as a means of disposal, and that's just not true. And this graph shows that very clearly. And that's -- we'll allude I mean go into the fact that why having access to all this poor space is important because of those numbers itself. So this is the chart, right? David went through this, but you can see produced water volumes growing as the access to capacity is declining. So having access and that's where this graph is concentrated is on Stateline in and around those areas that we talked about. And we'll walk through a little bit more detailed the dynamics that David walked through on the service ownership, but the craft is very, very important. And just as a reminder, this 5 million barrels in the $300 million of cash flow is super important and an opportunity we're really excited about. All right. So the concentration. So David pull up the map of the of the surface ownership. And Bailey, if you want to do that, you could do that as well. But you hit on it pretty well. Historically, all of this water was coming out of New Mexico. The Central Basin platform really wasn't an option at the time. So a lot of the water that came in, hit the first couple of sections that were owned right in this extra state line because of all the regulatory issues in New Mexico, not us. We've had WaterBridge to put a water shot on. Historically, I've always had the view that this injection needs to be spread out. And it's super important if you think about that and think about the port space as a commodity, but because of that landowner issue, you had 4 to 6 wells in a section. And that caused that pressure. And if we talk about Bernie, you're talking about seismicity, like that that constant injection pressure is very concentrated. It's what's causing some of that seismicity outside the Deep set stuff. So this -- we're really in a unique situation in a basin that is so high water oil cuts that we have an actual formation in the Delaware Basin Mountain Group that can take all this water if it's handled correctly. So this is super important why Landbridge is set to take advantage of this opportunity. I think more importantly, as we think through our geological teams and engineering teams that we're able to leverage off WaterBridge the ability to go buy a new surface that has access to that poor space is super important and puts us in a better spot than most of our peers. So move on to the next one. So we talk a lot about these 3 large projects. And really, this is a testament to the poor space and the way we think about geology. It's really enabled WaterBridge and other third parties to have access to these long-haul solutions. With Landbridge surface, we're able to offer a long-haul out-of-basin solution as well as an in-basin solution. A piece of that on the long haul side is Devon reserving the 300,000 barrels a day of future capacity, which is super important. That's never been done in our industry. But that really is a testament to them to know that this poor space is super important in the future, and recycling is not a means to support that. The BPX cracking deal has more of an in-basin situation. Again, it was our first acquisition with an H&H, BPX saw that they were in an area that had high concentration of disposal wells. We were able to show them a solution, a higher-priced solution than the alternatives, but a solution that could move the water away from their core area of drilling and give them some more certainty around not having issues on that. So that was a large project and excited and that will continue to grow with 400,000 barrels a day capacity. The next one we'll talk about is Speedway. So Speedway worked out really well. From a Water bridge standpoint, it was first brought on to take water from Eddy County to the Central Basin platform. As we've announced Phase 1 was oversubscribed, and we've now got Phase II in an open season. I think Chuck talked about -- maybe Scott talked about potentials for Phase III already, but really providing this long-haul out-of-basin solution is super important, and we think that we'll be able to continue to expand upon the land position there to add more poor space going forward. So this slide, we thought it would be helpful just to show you on a map where a lot of these projects are happening. We don't have to get into detail on that. But really, as wrapping up in summary, we've intentionally positioned ourselves to be the solution for growing demand on surface and subsurface, not just for WaterBridge but for the broader industrial group as well. Isaac?

Any questions before we turn it over to Isaac? John?

You guys touched on this a little bit earlier, but I for you're talking about this 6 million barrels a day of water growth. When you're talking about 6 million barrels a day water growth and then $2 million of declines on capacity elsewhere, you just talk a little bit more about what the underlying oil growth is there, trying to frame it up against some of the water oil ratio.

Okay. Great question. So first of all, all of this is in the context of the United States stays flat. And then you can also think of it as the context of the Delaware itself might not be growing at the same pace. But New Mexico will grow the fastest. So effectively, what we're showing you is a 6% to 8% oil growth rate in New Mexico, which doesn't imply oil production growth in the United States and doesn't even imply more than a 3 to or maybe 5% oil growth in the Delaware Basin in total. So at an 8% in New Mexico, you get over 11% or 12% of water growth.

That's helpful. How do you think about how much of that incremental 6 million barrels you guys will capture because you have

All of it. All of it. So we showed it at the road show and we can -- there are a few other options. We feel like our locations are highly strategic in nature. But I can just go around the horn, just show you a couple of other options in the middle of our frying pan Ranch Bailey Circle the area up. There's probably ultimately going to 500, 000 or 800,000 barrels a day of disposal there when you say, Jay. And then NGL has the ability to move 500,000 barrels across our North-South acreage into a ranch that TPL has on the other side. And that also has the ability for a little bit of expansion. And then to our north, the old [indiscernible] now old Arris, now Western has the McNeil Ranch, which there's probably 500,000 or 800,000 barrels a day of capacity there. But we're starting to show areas that are more costly to get to. And even if you take away the additional cost because you go to the lowest cost, best locations first, you still didn't get enough -- we still didn't take you through 8 million barrels right there. So there's a very high probability that in a reasonable world, by the way, if you look at the last 40 years of oil demand, there's been 5x that oil price -- that oil demand didn't grow for recessions and on pandemic. Other than that, we're between 0.5% and 1.5% of demand growth. And it is an incredibly stable line and it has not been it's amazing. So if you think about it in that context, you think that it's inevitable that it gets utilized just a matter of what time and what -- the question that was asked earlier, at what price because obviously, when scarce commodity gets scarcer and scarcer price moves.

Yes. I mean the only thing I'd add to that is that those numbers that you're talking to really don't even play in the fact that once the sour gas infrastructure gets put in, I mean, the amount of water that's going to be generated in and around that area, which is completely like directly adjacent to not only our Speedway pipeline, but also our speed ranch it's going to open up a ton of opportunity there.

Well, if you just circle that area, Bally, that is -- now the area below between Speedway and FinFan. That is the core of the sour gas window. And in that core -- that has been unexploited. I showed you earlier, it's been 3x outside of that. And there's areas benches in that part of the basin that haven't been excluded at all. That's what was in the U.S. So like the Avalon, for instance, incredibly prolific has not been exploited at all because the solution wasn't sufficient. We feel great about MPLX and their ability to continue to deploy capital to build out additional infrastructure. We're also going to be part of building out additional infrastructure to unlock that area. And that will have a secular growth trajectory irrespective of the overall basin, the overall country is literally just some of the Tier 1 acreage that hasn't been exploited and it will get exploited in a faster pace.

So the -- you're talking about the prime pain to the East?

Yes.. So virgin pressure. So the landowner that we bought that from also on the minerals and so he was very it's really paying attention to make sure that nothing was going to happen to pressure up as minerals and cause any issues. And so the only disposal wells that were out there were originally Concho, now ConocoPhillips he actually required the same spacing that we internally feel like is the right way to do it. And also what the Railroad Commission is taken in as part of the rules now. And that's that mile to mile house spacing code. So as we looked at it, it was really version pressure in a virgin area where we could really exploit the disposal wells in a way that we feel like is the right way to do it. And that was the same with in, right? When we bought Hang on that 75,000 acres and there's only 3 disposal wells, and that was primarily due to the fact that the land owner is so difficult to deal.

Explain when you're talking about a $0.15 per barrel price on the water, how does that change? And how often does that change? How is that priced?

So as an easy number for us to look at when we bought the Prime Pen Ranch because the $0.15 royalty was already in place. That's what he was charging ConocoPhillips at the time. And so that was an easy benchmark for us. As we think about it, and you've probably heard people say that prices could be lower than that. I mean, there are certain areas that where they want to exploit and put massive concentration on disposals in which they can't do anymore where you see more in the $0 to $0.12 range. we have a view that the price -- the royalty price, the commodity price at this porpace is going up over time for sure. It's just -- it's not a matter of if but when.

So how does that happen, Jason. Basically, we have some contracted volume at price with an inflation adjuster for WaterBridge already, but the stuff that's not contracted when it gets constructed a new price will be determined.

That's right. Yes. And the market is going to allow that. As solutions continue to be scarce, you're just going to consistently see that price increase.

I'll do the second one. Maybe just on that point, when you're thinking about $0.15 right now and going up over time, is -- is that potentially up over time on the same under current acreage? Or do you need to buy more acreage to reprice higher with incremental water bridge volumes? Said differently, is WaterBridge kind of set on that $0.15 right now for this incremental 5 million barrels a day.

No, no. No. SP1 No. We -- so when we did our Arman transaction with WaterBridge, we gave them access to a certain amount of sites at that set royalty. So if WaterBridge comes back to Landbridge and says, "Hey, we need more access to more floor space, it will be all dependent upon what those contracts look like. If one rig is willing to give some sort of a minimum volume commitment to Landbridge then maybe we look at. rate. But if it's just on spec, we'll see where the market is and can adjust that accordingly. But to answer your question, that the 5 million barrels is not walked in at the $0.15. And as we think through other third parties, we'll see that continue to increase as well.

Does that hold for Speedway Phase 2 or we think about those incremental barrels coming in?

Yes. I mean, again, they're -- they only have -- WaterBridge only has access to a certain amount of locations. So to expand upon that, there will be a negotiation at.

And that predefined access as well, that's not indefinite. And so there's a limited runway in which that current pricing scheme holds in terms of WaterBridge's option to execute on that.

Got like 2.5 million barrels a day of forspace?

We can get back -- we can get back.

Yes, I don't want to misspeak on the exact figure in terms but -- but yes, I mean, typically, when we go through acquiring surface to the extent part of that underwriting was done assuming water bridge activity, which is a good thing. -- we will give them a subset of the poor space, call it, preferential rights on that, and that's typically good for about 5 years, so the set price. But to the extent it's not action is usually, it goes to the market. And then the rest of the port space as well as market price day 1. So yes, I mean, I think there's a lot of room in there for us to react to the market and react to kind of the scarcity of continue to drive these prices up.

Yes. And the only thing I'd add to that people talk about the $0.10 being market, $0.5 market. Historically, there are landowners that have charged operators when they were to operate or own systems, $0.25 a barrel. I mean that was the rate until these water midstream companies came in and started adding scale to it. So it's not out of line to see things increasing to a number like that.

Just curious to get your perspective on Mexico stands towards water disposal. I mean, is it something that is potentially possible down the line? Or if that occurs, operators wouldn't even be willing to consider injecting in New Mexico because it seems like the value of the poor space is very contingent upon regulations staying where they are.

So -- it's not contingent on regulation staying where they are. It's contingent on really the history that's got us to where we are New Mexico is making it harder and harder to get your permits and has not has increased their volatility with which they regulate rather than decrease in stabilized it. So effectively, if you want a long-term solution, even if politicians came in and said now you can do it and we're going to enable it, you still wouldn't do it because you'd be afraid that the next administration, the next date administration is going to change it all around on you. If you think about it, for these guys, the value of your resource is massively, massively outstrips the cost of managing your water. So what does that mean for you? You basically want to make sure your resource gets exploited and doesn't get shut in. If you don't have a solution, that's a problem. So you look for long-term solution. And you don't have to just trust what we say all you have to do is look at the price in the market. We talked about on the WaterBridge roadshow, our average price per barrel for gathering and managing water, $0.65, our BPX deal was at $0.90 and Speedway was $1 to $1.25. It's going in that direction already, and it's -- people are paying for that long-term sustainable solution.

Great. We'll be talking about digital infrastructure now and how Texas and specifically West Texas has hit an inflection point. So we'll start off with the macro level overview of why we've gotten to this point. So critical time line is 2022 when artificial intelligence inferencing and training hit a substantial inflection point where we saw substantial deployment of capacity. This existential need for power became so intense. Complementing this is AI inferencing, training use cases, have some degree of sensitivity to latency, but not as much as commercial cloud. So that forces kind of the ability to look at new markets, new geographies. So this intense computing demand complemented with more flexibility on location and just the deployment in power. You have this convergence of power and digital infrastructure Texas is a very ripe market for digital infrastructure. We see the amount of CapEx that's being deployed forecast by 2028 -- I'm sorry, 2027, 2026 is in excess of $600 billion, which essentially surpasses that a lot of the oil and gas operators. So again, the macro level landscape is creating a right environment for us to really benefit from this. as basically digital infrastructure begins to be deployed or where it's been deployed in historic markets, -- it's become such an eyesore and a contentious issue that drives a lot of opposition to these projects. These opposition to projects stems from competition to finite resources, great capacity electricity, water resources. The battleground for creating delays is these permits that are long lead, only permits becoming even longer lead drivers. -- creating more risk to deploying capacity in these traditional markets. Is this next slide, please. So when you're looking at just the market, you see the finite ability to deploy capital in these traditional markets is complemented by these permanent deployment issues, West Texas becomes a more favorable landscape. You have boundless access to grid and power generation. I think one thing to emphasize here from a grid connectivity perspective from West Texas, for instance, is the Permian Basin reliability plan, which is adding additional interconnection capacity and the rich landscape of renewable energy generation. We'll talk about this later, but our ability to have access to water resources is also a part of enabling that data center infrastructure ecosystem. And I think something that most of us in this room may not appreciate is that West Texas is a very favorable landscape with respect to land use, environmental and permitting regulations, which accelerate your ability to deploy capacity much faster than any other market in the U.S. So when we go to the next slide, I think it's important to view the national landscape. The blue dots represent the traditional markets, which again have been adjacent to very traditional cloud computing use cases. So latency was a key consideration. With the emergence of artificial intelligence, inferencing and training. You see new markets emerge where there's a substantial amount of infill development, drawing emphasis to Texas specifically. -- so that historical concentration is shifting. New geographies emerge. Landbridge is well positioned, and we have not an incidental positioning. It's a very deliberate structural advantage that has been created not just through the land bridge position but through the Five Point ecosystem. Digging deeper into Texas. This is not speculation. This is not a science project. You can see the number of notable gigawatt-plus scale campuses that have been announced, not just in Texas, but more specifically West Texas, Abilene, I think, is the most relevant or appropriate example to highlight relative to open AI Cruso and the amount of capacity there is frankly staggering. Those differentiated offerings that we can bring to bear from a land bridge perspective, include a fast contiguous acreage. So these gigawatt scale campuses, large scale, we offer large assemblages of developable acreage. -- attractive natural gas positioning by proximity to the Waha hub. The amount of water availability that we can bring to bear in any 1 of our positions is substantial, and we've quantified that and we'll talk about that shortly. -- favorable grid outlook by virtue of the Permian Basin reliability plan, great permitting landscape and business-friendly legislation. So again, when you look at this map, you see existing markets in major cities shifting to the West Texas geography at scale and at large capacity. So taking it 1 step further, there's about 36 million plus acres in West Texas in the Permian Basin. Of that acreage, not all of it is suitable or right for data center or digital infrastructure development. Some of the core enablers for digital infrastructure development are proximity to great infrastructure or natural gas pipelines. This map on the right shows just the proximity to some of those most critical enablers to get access to power. Complementing that, again, I'll mention the access to water human capital dynamic, I think is also underappreciated in West Texas. The oil and gas landscape offers a rich supply of labor, human capital. And then more importantly, on Landbridge specifically, we've done the homework to identify, characterize an almost pre derisked sites to understand what sites are most attractive for a variety of hyperscale or digital infrastructure developers. So this includes identifying resource blockers, lands compatibility issues and understanding the local regulatory landscape such that when we engage with counterparties we have conviction on which sites are most attractive and try to have the highest and best economic use for these uses on our acreage. So I think one of the points of conversation around digital infrastructure, especially when you talk about competition for scarce resources is water access and the need for water access. A good way to validate the water use intensity or this metric in the broader scape landscape is the water use effectiveness ratio. So for every kilowatt of power that you generate compute, you have an associated water need. Using a very conservative estimate of 100,000 barrels per day for a gigawatt scale data center. We have in excess of 2,500 years of available supply. The estimated groundwater that we have on our acreage this is not conjecture. This is not something that we have third-party verification validation from one of the leaders in the space where we have the confidence to supply these volumes. This creates a complementary element where our ecosystem or our landscape, our offering is attractive, especially for water cooled solutions. I think part of the conversations I was having before this conversation was, well, what about less less water intense uses. I think David called out earlier that there's a significant trade-off when you're using closed-loop cooling. So a substantial 10% to 30% increase in power demand, while driving down your water consumption. And I think the takeaway here is that we can accommodate those very intense water use scenarios.

Yes. One thing I'd add to the water and the reason why we have access to this is because we've got such large continuous blocks in the way this is calculated on a per acre foot and that impacts how they give you your allocations. One thing that's super important an issue about this area is that prior to oil and gas activity, this area was home for the largest like Mellin forming Canalys in the United States. -- catalogs taking ton of water. And so there are no canal out there more because the whole gas activity, but the underlying water resources there. The one reason why they were -- the catalogs were farmed there is because the mass metal water in the soil. -- and also because of the recharge rates. So when it rains there, the ability for this resident recharge is huge. And that goes into this calculation, we had a third-party.

Yes. That's exactly it. We've quantified and understand the magnitude of that recharge potential and have also engaged and understood what the regulatory landscape is for withdrawing those water volumes from these positions throughout our acreage. Next slide, please. I think what you take away from the digital infrastructure revenue streams is that we have quite a comprehensive approach to generating revenue as David laid out, it's not just a lease or damages payment. There's a power royalty, water royalty component by which we have -- next slide, a series of just revenue streams being brought to bear. So this time line shows a notional representation of basically a data center, a gigawatt scale data center development project. you see kind of the time horizon 1 to 6 years. But before this time line actually begins, it's important to acknowledge that there's a substantial amount of derisking and understanding from a developer, a hyperscaler an end user. There's permitting, design and engineering. So before any work takes place, there's a phenomenal amount of just work that has to take place. Once that option converts into development, these hyperscale data center sites are thousands of acres. So there's a substantial amount of earthmoving that has to take place. There's great interconnections, there's placements of turbines. The revenue or the time to bring the revenue is a couple of years out. But these provide couple streams. And I hope what you also take from this is that the enablement of a gigawatt of capacity is not immediate. It's a phased development. That also happens concurrently with the building of the vertical digital infrastructure components. So -- this slide, I think, gives you kind of a key overview of a cheat sheet, if you will, of what we think are our structural advantages to enabling digital infrastructure, our acreage proximity to gas the contiguous acreage, the access to water that we can bring to bear and the existing and future access to grid, not just at the transmission level, but also at the distribution level. So when we talk about digital infrastructure, it's not just hyperscalers, it's also the smaller edge compute use cases or distributed bitcoin miners that can also benefit from that available capacity on our acreage. Fiber infrastructure, the proximity that we have is suitable for a lot of these use cases. But with the eventual deployment of gigawatt scale campuses, that latency consideration will substantially improve. And then one thing that I also want to emphasize is that we don't just have access to natural gas and grid. The West Texas landscape is also very rich and our acreage specifically has commercially viable solar generation potential throughout our acreage along with wind generation potential, which is complemented by the existing and proposed generation or transmission infrastructure. So what I hope you take from this conversation is that there are a number of existential problems or headwinds that the hyperscale data center industry is facing in existing markets. And we are uniquely positioned to offer solutions to those core blockers. There are a number of proof points in the broader space. It's not just the increase in capacity. It's also the increasing adoption of co-located and behind-the-meter gas generation. There are a number of studies that show that increasing adoption, not just from wholesalers, but hyperscalers. The emergence of Texas becoming a key data center market and then our just commercial track record that we're beginning to enable throughout our acreage. So we'll stop there.

Any question.

Just a question on the data center. Obviously, Texas benefiting huge from Pro growth and cheap energy. But data centers or is it like electricity where you have to have boosters along the way to the end market or you can literally put a data center any place in the world. And the end user here in New York, they don't care whether it's in West Texas, in Northern Virginia or whatever? Just trying to understand if there's any competitive reason that data centers in West Texas would have a harder competitive set versus anywhere else versus know the data travels just as quickly, it doesn't matter.

Well, haven't you been following land and he's going to put data centers on the move -- we're going to have

There's a lot of stuff that joke -- you also have self-driving cars that crash, so exactly the --

But what I would say, I'm going to give you the non-technical answer, then I'm going to let Alex dig in a little bit, but basically, if you think about the way what latency means, latency is time to the end user effectively. And in the early phase of development of a new market like West Texas, people talk about latency, but when you -- so your solution is optimal for training, large language model training. But your latency you're talking about is really Five milliseconds between West Texas and Dallas. So you're not talking about massive latency, but at first, your application is going to be for training. But as you get more data centers in the same area, the data center talk to each other and latency doesn't become -- is no longer an issue because you are the hub, and that's what we have in Langley. You don't hear people talk about latency between the data centers and Langley with California. Because it's not an issue because they talk to each other and they make it happen. That's what will happen here. And then -- and that's when you have inference opportunities and cloud opportunities as well with the preponderance of them there. Yes. And we'll cover this in detail to Alex from PowerBridge. You'll see that what's occurring is a tetanic shift of where load for compute is being located. And the principal reason for that is that latency is not as significant. And what wins the day is the convergence of all the factors that we'll talk about, which is energy, water, compute, power and the fiber really acts as a connective tissue. Think about it as an export pipeline of all of those attributes. And so there was a point in time where location mattered. It no longer matters, particularly with the fiber conduits that we're constructing, which we'll get into in the Power Bridge presentation.

Come back to the water side. You guys are framing up effectively the kind of groundwater and aquifer potential here. So on the kind of water sales side. Would you expect any of the produced water to go into this market? And then if you could just talk about potential kind of water pricing, even got water sales here? Is it a very different market different building purchase, but just from a dollar per barrel, does it look similar to what we see sold into the completions market.

I'll let Jason handle the price. But the technologies and the utilization of produced water are absolutely coming. We have desalination opportunities where it's more expensive than using an RO process on groundwater, but it's also there's a big motivation to be able to make that happen and make it happen at scale. So we are also working on technologies, and I will explain who we is there that will enable the utilization of actual produced water for cooling. And one of the cool things I get to do in my business is Five Point is I have a group that focuses exclusively on water management technologies. And we canvass the whole landscape because you can imagine, we manage 6 million barrels a day of water, probably more than anyone else in North America, maybe in the world. And when you manage that much water, every scientist who has a solution comes to you. And we seek them out as well. We test it in the lab. If it passes our lab tests, we'll pilot it in the field and if it passes a pilot, we'll institute it. And these technologies are improving to the extent that they will start to get utilized throughout the basin. So we feel like we will forever be on the cutting edge of that because of all the water we manage and because it's our focus.

I guess sorry, on the pricing maybe.

On pricing for the different types of water. Yes. So -- we talk about this our groundwater, right? We've got a fresh source and more of a mini touch source. The Bridie can be treated very very easily with like a smaller system. So that water is probably going to more be in line at the $0.40 to $0.50 a barrel depending on the amount of volume they need and how much they want to commit to. As you think about produced water, water bridge is in an interesting spot as well as Landbridge but Waters gets paid to take that produced water no matter what. So what we do in the downstream doesn't matter. So the price when you start talking about these technologies and the cost to treat this water and the equipment is going to be necessary for the equipment that's going to continually evolve, right? I mean we're already talking about some of these systems potentially could take produced water raw getting out the hydrocarbons and some of the heavy metals. So yet to be determined. I mean, as I keep had more conversations in and around the produced water pricing because we've -- we've looked at some supply top opportunities there.

Yes. So we've looked at a number of produced water being treated to meet a technology or facility cooling specification. And I think that pricing is a critical component. And I think we have a commercial structure approach that's thoughtful and addresses concern from the offtaker. What's another point of education with them is the opportunity to have them understand the regulatory pathway for using that water and then like Jason mentioned, the education and just the acceptance of that integration of that water into the cooling technology itself. But it's been conceptually well received, especially recognizing that tension that exists between water consumption and the competition for resources with data centers and the story, the narrative at using produced water and data centers in what Texas can create

Yes. Helpful. I guess, a quick follow-up then. I guess the thought process for groundwater sales, that is certainly a LBrevenue stream -- if you start using produced water that sits at WaterBridge, is that kind of a fair way to think about that?

Yes, because WaterBridge would have already been paying -- we've been paying the royalty on it. And as we talked about, those royalties will potentially continue to increase, but that would be a WaterBridge opportunity.

My question was basically a follow-up to that is, so does WaterBridge basically own that water? Like does the operator have any right to it? Does Landbridge have any right to it.

Contractually, when WaterBridge takes the water, they take custody of it.

So they can decide to put it into whatever use data in a beneficial of working on the data centers,

whatever with it.

How important is it for them to be using water outside of the hydrologic cycle?

I think when you look at using water outside of the hydrologic cycle. You see these trade-offs being made where they're sacrificing power capacity to use air cooling at a substantial cost of that power, the optics of it, create such a long lead driver in other core markets where they've learned from those lessons and they want to avoid the reputational black eye. Just like the hyperscaler digital infrastructure industry has made substantial commitments to decarbonize some years ago. You're now seeing a lot of these hyperscalers now make these commitments to undertake water replenishment ecosystem restoration projects to address some of those intense water uses. Last thing I'll highlight is that it's not -- shouldn't be a surprise to anyone that these numbers of water consumption are not broadcast broadly. So when you get a sense or try to get a sense of the magnitude of the water being consumed, it's hard to know, and that just is an indicator of superiority of the reputational risk that they're trying to.

Yes, you probably just add to the municipality situation. I mean, I'm from Avelinand it's caused a massive issue with the Stargate project because it was never broadcast to the city, how much water -- and how much the actual water needs are going to be. So I mean the pushback, they'll continue to get when they have.

All right. Yes. So we'll briefly walk through just some of the other industrial uses that we're seeing today and what we're pursuing here on a go-forward basis, if we go to 42, perfect. So we show you just a mix of customers at the top there. You could see, obviously, a lot of oil and gas industrial folks, but also a handful of others that are a bit more on the periphery. Today, we see some mining. We see some waste management. We have we have man camps to support kind of the broader activity in the region. But on a go-forward basis, we certainly expect these to continue to grow, but actively working through municipal water supplies, obviously, talking with both current and future -- potential future partners on man camps and housing, particularly related to to data centers. Some of you may have caught a recent article where there was discussions around the man camps and housing needed for the staff coming in and they need like golf simulators and things like that I spoke to. So I didn't realize that was on the agenda, but maybe we have to look into that as well. And then fuel stops just a number of other kind of enabling customers enabling revenue streams they are ultimately a byproduct or potentially could be a processor or a precursor to just a lot of the growth that we expected to see.

Yes. I mean just the thought of that you're building cities to support this -- that's right.

Yes, exactly right. So we go to the next slide. We touched on water quite a bit. I mean, Jason, is there anything you'd add on this.

No, I think we we went into a pretty in-depth. I know we'll talk more about it on the fireside chat as well. But the 1 other thing I would talk to real quick on that last slide was the College. So we talk about [indiscernible] as being something that we sell to the oil and gas producers, the gas plants, et cetera. But Scott likes to Trigoni Smith.

That's right. Jason said it wasn't cement. It's just rock, but when you add water, it gets hard. No. Anyway, it's a very valuable resource that as you think about when 1 of these things is constructed, any of it. I mean the vast amounts of Colichi is going to be required, and we are sitting on a huge reserve. If you scratch the surface in West Texas you enter into these caliche deposits that are throughout. So it will be a really big opportunity.

Yes. Yes. So similar to the other subsector exposure here, we tried to just highlight on the map where we expect to see some of this activity, and we've talked through quite a bit of this. I mean, I think the main takeaway from this slide from this section is kind of something I've spoken to you before is -- because obviously, a lot of activity we're pursuing directly on our surface and that's very obvious to point to accruing to our benefit over time. But as other development occurs off of our surface as other folks bring other kind of infrastructure online adjacent to us, Ultimately, it's a lot of this ancillary in supporting kind of infrastructure businesses, operations that are going to be needed just to keep that going. And so what we expect to see is just the ongoing compounding in just the industrial some in West Texas as a large land owner, particularly a large contiguous land owner, we would expect to reap the benefit of that. And then wrapping up on 45, we very much buy design, package our surface together to really be the optimal solution for a number of different use cases here. We've talked through all of these, so I won't move through them in detail. But again, these are all items that we're very thoughtful about, particularly as we continue to scale, which we'll talk through here in a bit. So with that, I think we've got a quick 10-minute break before we kick off the more detailed power bridge and data center discussions. [Break]

Thanks, everybody, for coming back in and sitting down. We're -- I'm going to introduce Alex Hernandez, we did talk about his prior roles at Cumulus as a founder of Cumulus and the CEO of Talen, but we're really excited to have him as a part of the Five Point family, and you'll understand from his presentation where and how he fits into the whole ecosystem and drives value to Landbridge.

Thank you, David. And delighted to be with you today. I'm going to focus my comments on how do we make all of this a reality. We had the benefit of being your seats a year ago before my partnership with David and had the benefit after our sale of Cumulus to Amazon and after running Talen, which owns 15 gigawatts for 7 years to think about where the next largest both power and data center market would emerge in the world. The conclusion I came to was that, that market would be in West Texas. And that beginning with a set of assets that had a certain level of attributes together with a team to prosecute that thesis was the optimal place to be of all the other places in the world that 1 could be. And so how do we think about the world, let me just start there. We observed the fundamentals. We take those fundamentals to develop a thesis. We execute that thesis relentlessly and ultimately drive value for PowerBridge and drive cash flow for Land bridge. Where are we in this thesis? We founded Cumulus, which is the first Direct Connect business, which I'll take you through, under the basis and the view that the world of energy was converging and colliding with the world of digital infrastructure and compute at a rate that few in the world understood. We did that in October of 2019, and began work in the spring of 2020, right in the middle of COVID. And then during the course of 3.5 years, developed the largest campus that Amazon has today globally, in Burwood, Pennsylvania. That convergence in the last 5 years, it's our point of view has only accelerated and also gotten larger in size. And so what's the trick to this convergence, the trick is execution, right? And the trick is how do you connect these concepts that we've heard so far, the macro, the assets that the 5-point ecosystem has, LandBridge WaterBridge and now the new entrant to the family, PowerBridge to drive this value, both for ourselves and for the ecosystem in its entirety. And the way we're going to do that is through a powered campus strategy that I'll take you through. So how do we fit within the ecosystem that you've heard of, Power Bridge's mission is to develop power campuses that is developing the electrical infrastructure that interconnects the surface to a center campus to the electric grid and to new power generation. There is a system of wires and substations and engineering that make the energization of the Lambert surface possible, and that is our mission. There are other important elements of this value chain, which is the fiber conduit that David mentioned. In addition to electricity, an overlooked part of the value chain is fiber. -- fiber eventually serves as the export pipeline of the natural gas and the water that are converted to information and that can be sold at a much more attractive price under long-term contracts, fiber and conduit is the key connective tissue that connects us to the end markets around the U.S. and around the world more broadly beginning in West Texas. And then you've heard about WaterBridge and some of the other Five Point family companies. Let me just spend a moment on a small town named Berwick, Pennsylvania, that many of you probably have never heard of. Berwick is a town of 6,000 people. You have probably heard of a town name, Pecos, Texas, a town of 16,000 people really at the center of the Landbridge ecosystem. Berwick in 2020 and Pennsylvania in 2020 had 0 data centers. At the time, I was CEO of Talend, we owned Susquehanna Nuclear, which is the largest nicapower plant in the United States. We were surrounded by Marcellus gas. We were surrounded by gigawatts and gigawatts of natural gas power plants that have been overbuilt in a prior crisis or prior cycle. And we were facing a situation where we had an abundance of electrons that were trapped in Eastern Pennsylvania and could not get to end markets. Right? Does that sound familiar? In West Texas, we find ourselves in a situation where, as Jason described, we have trapped water that can't get out. We have trapped gas that can't get out and there's been enormous value demonstrated already in creating businesses that fix those industrial problems and also take advantage of the value differential that exists from solving that problem. You can think about our power campus strategy as one and the same, but for power and for data centers. Cumulus very briefly what happened to Cumulus. We connected 2 of the largest nuclear power plants in the United States with a fancy extension cord and the substation system that was larger than the electrical system built by Dominion Energy in Virginia the country's largest data center market. We did that in 3.5 years with a team of 15 people. And while we were moving, the utility monopolies around the country were staying still, we're not investing in electrical infrastructure. And as a consequence, when the market grew to such a degree, we're unable to satisfy the large need for digital infrastructure and compute that came into the grid. And Cumulus was there to satisfy that demand. And if you ask the question back in 2023 when the business was sold to Amazon, where in the world can 1 connect 1 gigawatt of power and compute today -- the only answer was in Berwick, Pennsylvania, and we endeavor to do that 5x over, as David said, by building 5 campuses within PowerBridge, 5 Cumulus each of 2 gigawatts in size, 10 in total, expandable to 15 across the land brick acreage, taking advantage of the ecosystem. So let me next spend a moment talking about the path that we traveled in Pennsylvania and that now Pennsylvania continues to travel and how my belief is that West Texas that take us and that land bridge will play out much in the same way, but in my opinion, at a much, much larger scale. If you go back to just the last 2 years, I'm not even going to go back to 2020, there was the sale of Cumulus AWS. AWS now is investing $20 billion into the campus that we developed for them. In short sequence, immediately adjacent to our campus. Again, this goes to the value of acreage to the value of ecosystem to the value of clustering, QTS and Blackstone earlier this week announced the purchase of 2,100 acres for $250,000 per acre immediately adjacent to our cumulus campus. Why did they do that? Because all of the infrastructure that we constructed was present to facilitate the deployment of digital infrastructure at very, very large scale. All of the electrical was completed, the fiber was completed. And so adding to the ecosystem is much easier than developing it. And today, we estimate that from a starting point of 0, Pennsylvania is now a 7.5 gigawatt market that roughly translates to just under $100 billion of investment, roughly half of that is in a town of 6,000 people in the middle of the Marcellus Shale. My contention to you is that Pecos, Texas, when we come back and see each other in 5 years or every year is heading in this direction. So let me just briefly talk about and I'll get to execution. But what are the fundamental principles that we rely on as we observe the macro and use the tools and partnerships in the 5-point ecosystem at our disposal. There's -- the exponential growth of data is driving the convergence to energy because 50% of the operating costs and roughly 40% of the capital costs related to data centers are power and energy specific. The greater the growth, the bigger the problem and the more difficult to satisfy it quickly by the grid and by people that do not respond to market signals. Utilities, for the most part, with a few exceptions, are ill-suited to make that demand -- they were 5 years late in getting started and are now trying to catch up. Our belief is, because of that, data centers will be connected directly to generation, and you'll see that part of the PowerBridge plan is to bring and design our own power generation solutions, not to simply rely on others, not to just rely on the grid, but to contribute new generation into the grid, which is important to execution, but also important politically and regulatorily in the current environment, particularly if we continue to see the growth rate over the next decade, bringing generation will be important. How is the data center world changing? Five years ago, 1 megawatt, which is a unit of capacity of power or data was a very large transaction, right? Then 100 megawatts was a large transaction. We're in a world today where if you speak to the 5 largest market cap companies in the world, their feedback is we need at minimum 250 megawatts to even start a gigawatt to make it significant, 2 gigawatts or more to ramp and what we actually need is a multi-gigawatt clustered solution that can solve a decade of growth with certainty. Because the greatest growth -- the latest risk that they face our customers is to not have the physical infrastructure that allows them to meet the compute and high-margin profile of their cloud businesses or their AI businesses, all of those things do not happen without this physical layer that we're developing. What connects all of that? Fiber, I'll come to that in a moment. People focus on power. They focus on the other elements. They don't focus on fiber conduits. Fiber conduit is a key part of this ecosystem that connects everything together. David talked about the renting and the other routes. We'll talk about that in a moment. And finally, our belief is that the next large data center platform will emerge through the lens of energy. And you can think of us as one of the early anchor customers for Landbridge and for WaterBridge that will help drive value for them, for the ecosystem more broadly, in addition to any direct relationships that I anticipate Landbridge and WaterBridge may have with technology customers. So moving to what are we doing specifically? This is a map you're well familiar with of the Landbridge acreage. I've highlighted for you 5, what I'll call, target campus developments that we're hard at work on. We've been hard at work for the last year without being public about our work, but I will say that we're advanced at developing these 5 campuses across the Landbridge acreage. And the selection of these locations is not coincidental. These are places that have land abundance, where the surface conditions lend themselves to large infrastructure deployments that have ample water that have access to the fiber that we're developing, that are in important places of the grid electrically and the confluence of all those factors plus execution equals optimal places to deploy digital megawatts at very large scale. What do we envision the business model to be -- so on the left, you'll see, as I mentioned, we will build, and I'll show you a 3D model of our campuses that David flashed up briefly, we will develop with 5-point new natural gas generation. The market is tightening and notwithstanding the fact that equipment costs are high, we believe the economics are attractive and that the value of this generation, if used for digital infrastructure applications and to satisfy the requirements of the grid, is very high. That generation will be connected to what we call our digital campuses. This is the Power campus strategy that is effectively an electrical network developed by us Think about it as a mini utility, although we are not a utility that provides all of the electrical infrastructure to connect the grid, the power plant and the data center. And to the right, you'll see the customers that we ultimately think will occupy our campuses. And I want to clarify that our strategy is to provide the entire base layer until the pad and to provide pad-ready infrastructure for the customers themselves to go vertical, which we think is the most attractive part of the value chain. So effectively, we're providing to them a neighborhood where they can simply move in and to begin deploying their megawatts at scale. I just want to touch briefly on the noise. You can't swat to fly without reading an article about a data center or a project or a powered land or AI or there is so much noise in this market that it's difficult to differentiate noise from reality. Our approach has been to be quiet to develop, to work, to provide an executable plan and a key competitive advantage of this market it's to go to an end customer with a real solution that is actionable, and that is our plan. We can say we have a relationship with Landbridge in the case of one of our campuses, which we call Alpha Digital that I'll take 2. We have a relationship with Landbridge that allows us to access that surface. We have an order our electrical equipment for the digital campus are advanced in finalizing the generation solution. And when you go to a customer with a packaged plan and a full dinner menu, that, in our opinion, is the way to win in this market as opposed to pedaling land, pedaling turbines, pedaling sites, doing things that don't provide a full value chain solution that is a losing recipe in our opinion and the way to get through that noise is to provide a full solution that is executed. So what does that solution look like? David showed you this previously. This is not an artist rendering. It is an actual 3D model of our first campus of the 5 that I described called Alpha Digital. This campus, as you can see, is 2 gigawatts in aggregate. It encompasses roughly 3,000 acres near the Pecos area, near Wolfbone and -- if you look at the bottom part of this diagram, this is a 1 gigawatt deployment that includes a few key pieces of infrastructure. You'll see first that in the center of the page, there's what's called a private use network. This private use network is the electrical brains of the campus that connects everything together as I described, the grid, the power and the data centers. All of this equipment is on order. And we are in the process of finalizing the construction contracts to begin construction of this private use network at the Alpha digital campus. Next to it, you'll see island mode generation. What does that mean? That means a collection of smaller power turbines that in a certain set of configuration can run on a stand-alone basis without the electric grid because of the constraints that everyone around the country is facing interconnecting to the electric grid. And before my partnership with David on PowerBridge, I served on the ERCOT board, came off the ERCOT board when Power Bridge is formed. And notwithstanding the fact that Texas is the most nimble jurisdiction currently in the country, the backlog that the Q is facing is still very high and having an interim power solution is important. And finally, you'll see that there's a permanent power solution that allows the campus to grow to a gigawatt in size, and we would replicate that in the other side of the campus to grow to 2 gigawatts in size. And as you can see, the data center deployment would follow that power ramp over a multiyear period, right? So this is the product that Towerbridge is offering an end user. And in doing so, you can see we're using Landbridge surface. We would anticipate using water ridge water for cooling the power plant and ultimately, even if the customer were to choose starting with air cool products for their data centers, as chip density increases, our belief is that over time, given the advantaged water situation in this area, we have the ability as well to sell water for chip cooling at this data center campus. We talked a lot about some of the energy water attributes of the Landbridge acreage. One attribute that we haven't discussed is how strategically located that acreage is with respect to the electric grid. These green lines are the highest voltage transmission lines that traverse the state of Texas. There are 3 lines in particular that are dotted darker green here that are 765 kV lines plus you that have been newly approved by ERCOT, the Public Utilities Commission and the governor to construct the largest transmission project in the history of Texas. These 3 lines will cost $30 billion and will import and export power from parts of Texas to the Permian Basin to the Delaware Basin and specifically to places within or proximate to the Landbridge acreage. So the Alpha digital campus that I just showed you a picture of is depicted here with a little blue star that's hard to see, but it's not a coincidence that campus #1 is on an existing 345 kV line, but in between the 2 largest transmission projects that will be constructed in the history of ERCOT that allows us the ability to both import power when we need to and export power when we need to, but it is another factor, in our opinion, that will make that surface position even more strategic. And finally, let me just touch on fiber. David mentioned this a little bit at the outset. Power is nice, land is nice, water is nice. Our campus is nice, but none of this works at the scale that we're discussing without adding further infrastructure related to fiber conduit. This is the first time we've discussed it publicly. But what is our plan. Our plan is to construct approximately 1,200 miles of new routes that are underground routes. We haven't showed the routes here exactly, but we've shown you to where we're going. And each of those routes will have 6 conduits inside of them that can be purchased or leased to the ultimate data center customers. And we will go west to El Paso, as David said, and on to LatAm, on to Los Angeles and Seattle and the Western markets. We are going to Albuquerque and onward to Denver. That is a path that does not exist today in telecom. We are going to Midland and onward to Abilene and Stargate in Dallas and beyond. And the significance of all of this is that by the time we are done with our fiber conduit project, Pecos we'll have, in my opinion, the strongest connectivity story in the country over time. We will have 8 redundant underground fiber routes that will support the level of compute that we anticipate will occur within this basin. And we began doing this 1 year ago. We've been heads down on execution. There was a question about groundbreaking. We anticipate breaking ground in the second half of this year and have the fiber conduit completed concurrent with the completion of our campus and the power to offer the customer an integrated offering. So in totality, what I expect you'll see is us in the future being a hopefully good customer Jason, a good customer of Isaac driving value, of course, for our own business but being an anchor to the economic activity that we anticipate will develop. And I also anticipate beyond our efforts, we are just us, but I anticipate David and team will attract a lot of interest from the largest companies in the world. If the clustering effect that we saw in Berwick, Pennsylvania plays out in this region, you can anticipate in my opinion, an enormous amount of activity. And again, I want to emphasize we are early innings here, right? At the moment, there are 0 data centers in Pecos today. They were 0 data centers in Berwick in 2020. But I think just one man's opinion, we're at the same inflection point and all signs of commercial activity of growth point to acceleration and to deployment given the attributes that this ecosystem has. And I'll finish just very briefly with some people that you may know, Jobs briefly said don't be trapped by dogma. Don't be trapped by the fact that people say that West Texas won't work. David, 2 years ago said, West Texas was going to work, it is working now. And another friend of yours, Mr. Gates, suggested that -- we tend to underestimate the change over the medium term. So think about what the city of Pecos will become in 5 years and 10 years and hopefully will be a productive part of driving that change. Thank you.

Any questions for Alex.

All right. So I guess there's a lot of confusion around the different types of water. So you guys have aquafer both fresh and brackish then you have the produced water. Then in terms of end users, you have the water that can go into cooling towers for power gen, you can have heat rejection in the data centers. And then I guess there's also a component where you could do liquid immersion or direct cooling for the chips. Can you kind of walk through all of those different areas? And I guess, where the value capture is and what you're most excited about on the waterfront?

Yes, happy to take that. So I think when you think about water, the water that we have access to, let's focus on fresh and semi-fresh or brackish all that water can be applied to the facility or technology cooling use cases. The punchline is that it's incremental amounts of treatment for a higher spec or more clean. And so that would be basically supplied by land bridge and then potentially treated by WaterBridge through RO systems and filtration processes.

Yes. I would get back to what we were talking about earlier, just the vast amount of water that we control will really give us a leading edge here as we think through Alex's conversations with the data centers and the hoscalers that they need access to this water. And this goes back to the what I said about the municipalities, right? I mean the proximity to non municipalities is really a good thing. And the access to water, because of our continuous nature of our service position, there's not another surface provider that could offer that same solution.

That's exactly it. And I think the other part of the conversation is the magnitude of volumes that would potentially also require recycling and disposal. And I think that there's an adjacency to the WaterBridge core business for which we're engaged in some conversations with a number of known counterparties where we're delivering or iterating on how to deliver a solution that's cost effective for their data center facility.

And so clear can treat it produced water ever be treated to a standard that can be used in a data center?

Yes.

And like what cost.

So obviously, it's a higher cost of produced water to meet a facility or technology cooling spec, but the manner in which we're approaching it is that the end user of that water wouldn't be the sole are of that cost. Obviously, there are commercial ops and levers that have to be calibrated the model. I think we have a pretty high degree of confidence on a model that works. The critical element is ensuring that, that water is one applied at an economic rate that is the same if not marginally better or not worse than the available water to having the certainty that the regulatory bodies, TCQ, Railroad Commission, that interface is resolved. And three, that we give them the confidence that this isn't a pilot and that it's been fully integrated without introducing operational risk to the cooling or facility infrastructure that's interacting with that water. Is that

Do you expect -- no, that makes sense, but do you expect kind of like initially more freshwater or more...

Definitely in water and the I think that, that's definitely the reality is that you go with something that's known and proven. And I think that part of our messaging to the market has been as the optics or just the availability and abundance of this produced water is proven, we can introduce that in a meaningful level where your water supply, your water use story is building upon something that's core to the Permian Basin.

Can you maybe expand a little bit more on that closed loop versus open loop? And why I think you mentioned in Texas, you would see more open loop than otherwise you might in the rest of the country?

I think the key takeaway there is that, obviously, open loop requires a phenomenal amount of water, whereas closed loop, you're able to use substantially less amount of water, but the trade-off is that you're trading between 10% to 30% of capacity to apply to this cooling. So that power has to come from somewhere. And I would argue that you're just shifting the water use burden to a different party and ultimately, that need for water is still there. But Alex

Yes, I think the key is to build data center solution and a power shell that can accommodate a variety of water solutions. And a customer may decide in the first instance to start with air cooling. But in the data centers that we've constructed before you put in a race floor that allows water infrastructure to be constructed underneath the data center and the 3 feet there and then piped up through the servers over time. And that flexibility as chip density evolves as heat requirement and cooling requirements evolve is really, really important and is likely to support very significant water usage, but without any of the potential community concerns that exist in other parts of the country.

Thank you. David, earlier, you quoted a $10 million to $20 million of free cash flow per gigawatt that's a number that's moved a little bit. So I guess, if you guys could talk about how you thought about that over time? And then second part of that is power royalty. But I guess on this setup, we're talking about I guess, eventually tying into the grid, maybe your on-site power gen is lower over time? Maybe just think about kind of LB's exposure on that piece?

Sure. So the $10 million to $20 million was illustrative and by design conservative and didn't include water didn't include water because you have water options that can span air cooling to open loop. If you add a full open loop system, it can be a $20 million to $40 million location. What I wanted to do rather than rather than show you the exact amount, I would think you get out of a gigawatt campus because I want to just show you the magnitude of the opportunity. And if you want to think about it from an open-loop cooling perspective, -- you can think about the number Scott's used in the past, the 20 to 40 and multiply that by the gigawatts that you expect to be there. If you want to be super conservative since we don't have contracts to show you in place right now, you can think about it in the 10% to 20%. But the bottom line is it's about the same magnitude of the opportunity as the port space is long term.

And then on the Power royalty, just how that could change over time?

Yes. So it all depends it's like a balloon. If the owner of the power does not want to pay a power royalty, the lease will be much higher. If the owner of the power of the -- if the hyperscaler in campus One, wants to buy the acreage. We won't be excited about it, but to get the first campus done, we might consider it. And you'll do some different things, but the reality is there's a market for this and that market is in the range as we discussed. One last one for me. Just in terms of timing, kind of milestones, you talked about kind of ideally starting construction later this year. What should we be watching for? Is it commercializing with a kind of anchor tenant? Is it something on the air permit side? I guess just what do you kind of want to want us to watch from here? Well, we will announce LOIs. We'll announce PPAs and we'll announce commencing construction of the private use network upon and announced construction timing of the power plants, too.

And for reference on the permitting, NRG is already filed. For the airport Air Permit

And their connection to ERCOT.

Yes. And I'm sure, Alex, you were behind that, right? And we also have island solutions that can get going before you get connected.

I had a couple of questions. Just kind of looking at this footprint and putting something like this in an active oilfield, thinking about infrastructure that's already there, wellheads, things like that, just what are the challenges with that kind of

That's a great question. I was actually just pointing out the schematic here really shows the efficiency that we can create with our land, right? I mean what you've seen here is they've overlaid this in conjunction with existing pad sites, existing roads, existing ride ways, existing pipelines, et cetera. The one good thing about pipelines that they can always be moved if they needed to be. But I think and Alex term me wrong, but you guys can be very flexible on how you think about the construction of the campus to really fit in here. This is a really good depiction of that.

Yes, that's right, Jason, completely. We've designed this in consideration of all the existing infrastructure that is there. We picked locations within Landbridge acreage where these types of campuses are possible. without any incremental infrastructure work. This is a real depiction that contemplates the existing site conditions, earthwork conditions, the existing infrastructure. And to the extent that this campus continues to grow. As Jason said, the infrastructure can be moved or adjusted. But this contemplates all of the existing infrastructure that exists today within the acreage.

And then just another one. You talk about Peco is becoming a population center. There's been a lot of stuff going on out here for a while, and it's not. So I want to maybe understand the competitive advantage of doing it here. like Midland Odessa have been. I've been in the middle of Odessa but -- these are questions I get.

So I want to you're 100% right -- you're 100% right. And the difference between Midland and Odessa and Pecos is what side of the bottleneck that you on? The moment people look at a 100-mile difference in location on the other side of Waha Well, you're pulling gas off a long-haul pipe that's already got it priced for the end market. You're not pulling stranded gas off our header system. It's a very important distinction. So Pecos is on the favorable side of the bottleneck effectively. It's unfavorable if historically you're trying to sell your gas, but very favorable if you're trying to buy gas. And that's the point. So everything we're talking about is to come. And what you've seen from Pecos in the past is you've seen the oilfield operate in really a 15-day on, 15-day off, 20-day on, 20-day off mode, where people come into man camps, they work, they leave, they come in and work and lead. And that's been fine. That's not going to work in this scenario. And there's just going to be too much -- if you -- you can -- Alex can actually comment on what's happening in that 5,000 person town of Berwick and how you think that's going to play out over time. But it may be that Pecos looks the same for 3 years. But over 5, 7 and 10 years, this is going to look like a Midland Odessa able kind of.

Yes. the Pecos Economic Development Corporation has got a lot of tax dollars for obvious reasons. And they have been frustrated historically with oilfield personnel as they do come in and rec the roads in town and then leave, right? So they are very concentrated on being on the front line with the data center developers to make sure that the right hospitals and schools and infrastructure going into place in the city. So I think it will be -- we'll be working in conjunction with the city to grow all this, and we've got lands for everything all around it. So again, that will be another great opportunity for Landbridge as the city expands.

This is for Alex. Alex, if you think about comparing West Texas specifically dry air conditions versus what you have in PA when you were building that out? How much of a difference do you expect to see in your data center Pew between those 2 regions?

Yes. It's a great question. In extreme heat, power generation is slightly less efficient. The -- that efficiency differential is not meaningful enough given the low cost of energy to make a difference. And the other important difference is that the Marcellus is great, Pennsylvania is great Pennsylvania is a difficult state to develop in. It's got a number of environmental rules, a number of land use rules. And by contrast, from a development point of view is far easier, right? So I would say the economic impact of both PUE and power generation is negligible. And well more compensated by the cost of gas.

Question maybe it's looking too much into it, but the fiber ring that David showed us earlier, look to me like it just had Pecos at the exactly. And your data centers are not your first 1 is going to be inside that reg looks like. But what's the interaction there? What are the considerations with citing those other centers outside that ring and more along the route?

Yes. Great question. So the fiber ring -- the purpose of the fibering is to connect more than one campus and it's approximately 133 miles around the Pecos area. We have a ring that will likely be a southern ring and are working on a ring that will be a Northern ring. That will encompass -- it will look like a figure 8 roughly over time, and it will encompass all of our campuses and importantly, third-party campuses. And so that ring has been designed strategically to both enable our campuses, but more broadly to enable the region. It will connect the existing fiber providers to the region. There are 3 of them will interconnect to our fiber ring. And then we also -- those rings will be interconnected to 4 new long-haul routes. And that drives data gravity, so that you become a hub just like an airport.

So understand, right? There are other rings, they're just not on this other ways -- it's not obviously.

Yes. This is an illustration. The first ring, which is the 1 that we're -- we'll break ground on this year is surrounds our Alpha digital campus that I've described. And we will have a small lateral from out the digital to the ring, and it will be the brains of the entire connectivity system.

Awesome. If there are no other questions, I think we'll take a quick break and then

I think we're going to move straight into the fireside chat. So minute break. [Break]

And refining analyst here at Barclays. Thank you all for being here today. Of course. So much to unpack and marinate on just in the past couple of hours. We're going to go through lightning round fireside chat Q&A.

Okay. Here we go. So -- you talked a lot about the benefits, the core competitive advantages of West Texas out of power land market relative to established hubs. -- surface use availability, the track resource, the regulatory environment, et cetera. Why do you think it takes so much convincing. In your opinion, what is the biggest source of market misconception? And is there anything else you would like to highlight.

Yes, go, Alex. I would reframe the question. I don't think it tastes convincing. I think it takes execution. The reality is in order to have blinking lights in a data center cabinet requires an unbelievable amount of execution. So all of those attributes exist. There are people that will be naysayers, but to actually execute on it and give a product that can be turned on. To me, that's the most difficult part. Right? And in Pennsylvania, it was a great idea, but until it was built, it didn't work. It wasn't real. It wasn't feasible. And along the way, maybe 150 people told us they would not work until it was actually constructed. And so I don't think it needs convincing. It needs execution.

And Alex, once it was constructed, -- what did that process look like? Did you have Amazon or are there others as well?

Yes, great question, David. So for 2.5 years, there were 10 people saying, this is never going to work. No one's ever going to build in the Marcellus. And 1 is ever going to build in the middle of nowhere. No one's ever going to build next to a nuke. On and on and on. When it was constructed to David's point, 4 of the largest market cap companies in the world were buying to buy the campus. Amazon was the winner and 4 of the largest public and private data center operators in the world were there to buy it because the capacity was available, ready where they could deploy.

Got it. proof of confidence what we're waiting for. Okay. On the water side of things, a question for IVX. Can you talk about the evolution of air cooled versus water cool data center solutions. Why is this important?

Yes. I think this is encapsulating a lot of the previous talking points where data centers are a relatively nascent industry and people are only just becoming aware of the intense water resource demands that these facilities have. And I think part of that shift to less water and sense cooling usage or approaches is being responsive or cognizant of one resource competition, to the broad awareness that water scarcity is also an operational risk, if I'm relying on a water intensity source that I can no longer access, I can no longer operate my facility. So I think that, that existential and reputational risk is driving that shift and that embracing of it. But again, there's a significant trade-off to be had with consuming more power for the cooling.

Okay. So just highlights the exceptional demand for water supply in general. What about disposal needs? Is there an opportunity for recycling treatment involved news that leverages the water bridge value chain.

Yes, for sure. I mean, Isaac can answer this in more detail just with your experience on the potential disposal needs. But if we are talking about the reuse and recycling, there is going to be a discharge our byproduct that that's going to have to be taken care of. I don't think that the hyperscalers understand that 100%. And we're trying to explain that to them that, that is another part of the value chain that we can offer, which is very unique in other landowners.

I had a question posed by it, not a hyperscaler, but an AI computing company. It's like, well, we can just connect to the sewer to dispose of our water, here Sears 50 miles. Yes. So I think that, as Alex pointed out there, there's kind of a proof of concept and part of it is derisking these value chain components and educating them on how we can bring to bear a solution that is not known to them because it's a new geography for them. Regardless of whether it's air cooling, there's still volumes that are generated, slowdown volumes and in any type of cooling configuration, there will still be a need for disposal volumes, albeit at a lower volume so.

Yes. The only -- and this goes back to 1 of the first question is like how do you check all these boxes and derisk the situation. I think with with Alex's history and also with Isaac, I mean, we didn't talk about this, but I was spent many years at Microsoft doing just this in South America, right? So they both have a very good view of what each individual hyperscaler is looking for. And our ability to derisk that for them, I think is -- it will take time, but the proof of consequence to here, it's going to be really good.

Okay. So in addition to education and helping your customers understand the derisk value proposition, on the power side of the equation, what is West Texas and Landbridge specifically doing to attract power providers for BTM and co-located solutions?

So there's a lot of work in terms of characterizing our existing access infrastructure and grid. And I think that part of the talking point that's important to acknowledge is that beyond transmission infrastructure, there's a lot of distribution infrastructure. In fact, WaterBridge is a large consumer of power. And so we have access to power that we can bring to bear on sub 75-megawatt kind of tranches. And so that's an incremental opportunity for us to have smaller digital infrastructure use cases, and we're characterizing that. We're characterizing the access to that capacity. There's a premium to be had by providing quick access to anything over 10 megawatts, and we're recognizing that. And are exploiting that.

Okay. And within your commercial development process, -- how do your conversations with hyperscalers differ from conversations with power providers? Are these discussions one and the same? Or are they typically involved in multiparty negotiations?

Well, Alex, as we talked to, we have 1 partner in NRG. We've bridge, we've signed an LOI to have a build out a 1 gigawatt campus with NRG. We've got NRG. We're well along the way in signing another one with a very large IPP and those conversations are a recognition by these big power companies that they need Alex with his team and what are the attributes of our campuses bring. They have the power, but they know they need a location, they need to cheap achieve gas, the attractive water and they need a team who can build out a private use network and manage it all and package it up with a bow and sell it. So those conversations with the power guys are really interesting in that regard. We've had multiple conversations with IPPs who wanted to do this with us. I can't do it with everybody, but we'll have 2 here in the next 30 days. And both of them have awesome attributes that can bring the game to the finish line. The difference with the hyperscalers is they know specifically what they want to do, but they don't necessarily know how to do it. I'll give you a funny anecdote that my gas marketing company experienced in Ohio. They are working with a hyperscaler who wanted to get gas from an interstate pipeline that was going by and they were getting -- they were being shown the constraints and the issues associated with getting gas off the pipe and their answer was, let's just buy the pipe. And I mean, if you're not an energy guy, you don't know how silly that thought is but it's just silly, and it shows a level of understanding that is nowhere near what's necessary to ultimately develop what they're trying to develop.

I'm sure at the right price. We're an interstate pipe. Okay. So is the focus for Landbridge only on hyperscalers and Giga scale campuses or is lanes pursuing wholesalers and smaller developers as well deploying sub gigawatt tranches at capacity?

Yes. I mean I'll start with that -- I mean, I'm sorry, Isaac finished because he's had majority of these conversations. But we have been hyper-focused on exploring all options, right? And to Isaac's point earlier, we have access to surface near and around facilities that these smaller guys are needing. So you're talking about anywhere from all the way up to 300, right? And these could start off with coin mining, bitcoin mining and moving evolved into more of a data center type situation. I mean, Isaac, would you add to that, anything?

Yes. I think that's precisely the point is that the existing infrastructure there can enable quick deployment of capacity access...

Access to substations, et cetera.

That's exactly it. Yes.

And what is the difference between a power campus strategy versus the traditional powered bland terminology?

Maybe I'll take that one. Power land can mean a lot of things depending on the context. It can mean that there's land in Virginia that's connected to a utility. In many cases, it's become a commodity where anyone at any part of the country that has binoculars and can see a power line on their land, calls their land, powered land, and it's really not. And the greatest challenge for the customer is sorting through what in fact is energized and what is not. And the Power campus solution is effectively 1 that provides the customer an energized neighborhood that they can simply move into. The powered land implies the customer often has to deal with the complexities of power and the grid and regulatory. And in general, that is not their preference. That is not their skill set. It is slow to do, and they will do it if they have to, but they would prefer to just have their package solution if that's available to them.

And going back to the earlier comments about execution, proof of concept, who is executing the actual physical construction of data centers at this point? Is that a challenge?

I guess you got to go hyperscaler by hyperscalers, some hyperscalers like to do it themselves, like Microsoft likes to use Vantage. There are very substantial businesses that like to do that vertical construction. And again, some of the hyperscalers like to do it themselves. We think that's maybe the least interesting part of the whole framework, but 1 that we would do to the extent someone asks us to do it, we'll hire someone else to do it and we'll make it happen. But typically, that's a vendor approved by a hyperscaler who's either the hyperscaler or the vendor and they're going to rock and roll with it.

Right. And the key thing is that the -- if you think about the campus that we showed you and that base level of infrastructure -- that infrastructure is needed in all cases. So we think it gives us maximum optionality. We also think the capital to return ratio is most attractive at that part of the value chain. And once you have a pad-ready site, if a customer asks us to go vertical, we can go vertical that we built a power shell in Pennsylvania, Amazon built the next right? And so that gives you a lot of optionality because that base layer of infrastructure is needed in all cases. And depending on the customer, depending on the commercial relationship or partnership in most cases, they will go vertical -- in some cases, we can do it for them or participate alongside.

And looking at your own commercial backlog as well as the broader industry, how do you see the time line for data center development or deployment rather in West Texas evolving given the need for power infrastructure build-out.

Yes. You saw Isaac's time line and GaN chart. These are long-dated capital projects. But you need to make progress quickly along the way, and there are important milestones in that long development cycle, right? There's the selection of the site. They are the filing of grid interconnects. There are the filing of permits. There are commencements of construction, there are prepayments on a PPA is the execution of the PPA. So although these projects take a long time to execute in the case Pennsylvania, we've seen a 5-year execution cycle. They are important markers along the way that give you a trajectory to growth that's really important.

And with all this in flake, Jason, what is the general feedback you've gotten from end users?

I'm going to have to turn this over to Isaac. Again, this is his expertise, and he's dealing with a lot of the hyperscalers and the power providers.

Yes. A lot of the feedback that we had at the early stages is it's not a matter of if, but when. And I think that as those conversations have evolved, particularly last year with the Permian Basin reliability plan being announced, there was more confidence complemented by more behind the meter and co-located solutions. And there was also kind of more of an interest or inflection point even a couple of weeks ago from just conference presentations, whereby PowerBridge and others were highlighting the value proposition of West Texas. So -- the feedback thus far has not been outright rejection or denial. It's been -- it works. I think the playbook will be written, and I think that will unlock a lot of.

But confident conversations have had recently in...

And without betraying those counterparties, I think that the modalities by which they want to engage on our acreage spans from greenfield development on large contiguous tracks of acreage all the way to kind of an assembled offering where they're relying on a lot of the ecosystem. And interestingly enough, even independent of our land position, the access to the water resources for off-site water supply has also been quite compelling. And so we're engaging in different parts of the data center value chain that Landbridge can enable.

Great. And this might be a question for Isaac as well. But in other markets, we see data centers being delayed or outright canceled due to permitting resource competition, lack of support, et cetera. What is the sentiment you received thus far from local government and elected officials are there regulatory or local stakeholder risks that could materially delay execution.

From our vantage point, I think 1 point to emphasize is that the WaterBridge land bridge presence in the basin is pretty substantial from a good corporate entity and strong employer in the basin. So our reputational standing there is quite strong. So with some of these conversations, there's been a phenomenal amount of support, but the emphasis being on tax base and water stewardship and replenishment. But there's a phenomenal undeniable appetite and willingness to work with us. to make these projects happen because they stand to be transformative for the community in West Texas in general. Alex, sure.

Yes, I would just say more broadly that if you rewind 5 years, the largest data center market in the United States was in Ashburn, Virginia, right? Close to Dallas Airport. Many of you may have been to WolfTrap. It's a really nice outdoor concert venue. 5 or 10 years ago, that was all farmland. Today, you can't throw a baseball without hitting a data center or you can't go out your back porch if you live there without looking at a data center. Virginia is out of land. They're out of power and the residents are out of patients. And so as a consequence, our strong view is that given the size of the infrastructure build-out, this will be done in communities like Pecos that welcome that development that can provide the infrastructure for the development that do not have the constraints of being behind an interstate pipeline as Virginia does and will be developing places like Pecos and in other places across America that have been forgotten, old coal towns, old steel towns, places that those communities, those city councils are hungry to welcome new development. I think Pecos is going to be Exhibit A, but we would also anticipate cities across America with similar characteristics being redeveloped.

Great. So last question for me. Are there any lessons from traditional energy infrastructure development in the Permian that you're applying to the digital infrastructure projects? And what in your opinion, David, maybe this is for you, would constitute our specific milestones over the next year or so that would translate to you as a validation of the West Texas digital infrastructure thesis?

Sure. So having constructed many projects, you have to understand how to lock up long lead time items early. And Alex and I started talking about how we're going to get out the digital rolling, it became obvious, sorry, let's lay out the critical path, what's on the critical path. Okay, transformers and substations, critical path. Well, if you don't lock them up, you don't know where they're going to fit and how do we not, had we not contracted to take -- to put our down payments and begin paying for these things to have our slot. We wouldn't know when they'd be ready. We're in the same position on other long items like power, like your bridge solution that you'll utilize your island mode until you get to your long-term solution where you're connected to the grid. So really, it's about those long lead time items and getting control of those, I look back to when we started North Wind one of the biggest things we had to do is we didn't have an asset. We didn't have an acid gas injection well, we didn't have a contract. But we found we had a slot for the kind of pipe that you need to manage high CO2 high sulfur gas. That slot was the only 1 had we not taken it. It would have been 6 months delayed and maybe we lose the whole opportunity. So we put $80 million up with the idea that if we have to sell $80 million a very specialized pipe, maybe you'll lose $20 million. But you have to see those long lead time items and knock them down because if things play out the way we expect, those bottlenecks become real and painful. So I guess that's my answer to sort of learning we've had. And that's not just the Permian, that's everywhere. And that's everywhere as things get busy. When things get busy and active, you have to be all over the long lead time items. And I think if you are as an investor or a potential investor in LandBridge wanting to see where those milestones are I think we might have mentioned some of it earlier, but watch for the announcement of letters in 10 watch for the beginning of construction of the private use network, the beginning of the construction of the power, the power purchase agreement and also the air quality permits. And the interconnection is a little is a little misleading because it's not on the critical path. It's helpful. And when you see that, you know long term projects rolling, but we can do a very substantial part of the business in island mode, i.e., not connected to the grid. So don't get too caught up in the interconnection piece. But those are the milestones you should watch for, and we won't be shy about sharing them. And we have a good -- a high level of confidence in ourselves and our capabilities and the probability of success here.

Great. Well, thank you all very much. I'm going to give Scott back at [indiscernible] some Q&A.

Okay. Yes. So just a few slides to wrap up here before we open to questions. Starting on 48, this is intended to be more than just a victory lap, but I think it's impressive the growth that we've been able to execute on to date in the platform we've been able to build and continue to scale not just from a financial perspective, but also from an asset perspective. And it really sets the stage stepping into '26 and going forward, to capitalize on so many of the opportunity sets that we've walked through today. Now if you were to the next slide, historically, you see we've been able to continue to execute on this growth plan despite what has been a very challenging commodity price environment. And that was a question we got quite frequently through the IPO is how will this business perform if we see oil fall off. If you recall, we were kind of in the middle of 2024 and obviously ended the year in a much less constructive environment from an oil perspective. But despite that, we've been able to action our growth strategy effectively and have been able to continue to reflect the positive nature of the business model and its ability to perform and remain fairly insulated from commodity prices. Now how do we continue to grow going forward. If you go to the next slide, we've talked a lot about the service use economic efficiency figure. I've mentioned this $2,500 to $3,500 an acre goal with 3,000 being the midpoint. The punchline is there's just a lot of ways that we can go about actioning that. We're showing you 4 examples here there could be multiple slides of different permutations of the activity we're showing here showing here. But you look at just the very obvious example, which is one square mile or 640 acres with the produced water handling facility with some of the blank space or white space around it being backfilled with low economic dense activities such as solar, and you easily clear that $3,000 per acre mark over 100 -- excuse me, 1 square mile or 1 640-acre section. Now there are obviously some activities that are going to be higher than that. We have sand mines in place today that do $8,000 to $10,000 per acre. The data center projects we're talking about with Alex and team could easily eclipse $20,000 per acre. Additionally, we do see areas with just mixed industrial use. And we're showing you on the top right here, just 1 of those sections may look like in a decade here, and not all of them are going to be 3,750 an acre. We could see much less than that. We could see much higher than that. But the takeaway is there's a lot of intentional planning that goes into exploiting and really driving the value on the surface here. But with that proper planning, you can really do a lot in a fairly dense way. And actually, I'm going to flip back to a slide that Alex showed because I think it's a really good example of this on 14, where he's walking through what that campus could look like, and what's not readily apparent, but surrounding it is just a number of roads, access points, drilling pads, and so on, all of those are ways that we can continue to extract value from the surface in addition to the data center that is immediately adjacent to it. And so it takes some thoughtfulness, -- it takes some planning. There were some questions on whether or not these are viable because of the activity in this area. And as Alex pointed out, absolutely. It just takes a little bit of thoughtful on this. But when we go through and we action our plan, we're able to ensure these projects can be put in place without hampering or hindering the economic potential of the surrounding area. Now how successful have we been on that? Again, on the surface use economic efficiency, I think this is a really good metric of the effectiveness of our active land management strategy. A question I get quite a bit is, what does that mean? How effective is it? How do I know you're not just buying your way into more cash flow. And while we're certainly continuing to look to do accretive M&A, which I'll speak to -- the punchline here is if we look at the acreage, the revenue per acre over time, on a particular footprint, you could see the growth of that, and you can really see the byproduct of us going out there and intentionally commercializing surface that has not been actively managed previously. What we're showing you on the bottom here is just the growth of our original position we bought in late 2021. As you can see in the first full year 2022 is doing roughly $465 an acre. It was much less than that when we bought it in '21. But just through the growth over the last several years, we've been able to drive that to $1,159 an acre with a lot more growth expected going forward. We expect this kind of growth to continue on a go-forward basis, not just on that legacy acreage, but also as we work through and acquire new surface that has an equal opportunity for growth. Now what do we look for on M&A being another critical piece of the growth formula, we look to leverage the relationships we have in West Texas, Jason and his original team from the WaterBridge predecessor company have been very intentional about developing those relationships for a decade plus at this point. And that really allows us to get our foot in the door with a lot of these landowners who would otherwise not be interested in selling. I think the second piece, though, and one that's really critical is when you think through where the land owners getting out of selling to us, oftentimes, it's not just the upfront check, but it's some kind of enduring or residual economic interest. And that's kind of different ways. You could look at sellers taking back equity, which they did recently in that '19/'18 transaction. You could also look at the '19/'18owners as well as some previous sellers who retained the mineral rights because as we've discussed, we're not looking to really grow the minerals estate primarily. And why that matters is there ultimately beholden to the level of activity on that surface going forward? As a mineral estate owner, you want to ensure whoever owns that surface is able to drive development on that surface is that's going to generate more cash flow from the minerals state. So they have a vested interest in ultimately who they hand the keys over to. I think we've proven that we can be very thoughtful that we can drive development that we can drive value. We can enable oftentimes development that wouldn't occur certainly not at that same pace otherwise. And that's really incentivize a lot of these landowners to introduce themselves to us and look to potentially sell their acreage to us where others would not be able to step into that kind of discussion. Now I mentioned [ 1918 on 53, ] we go into a little bit more detail here. Again, this was a seller that we've had I have not had, but Jason and others on the team have had relationships with for a decade plus at this point. So it made for a very easy discussion. They retained the minerals estate. We took the surface, which again, creates some alignment going forward. They also took some equity back, and that was by choice. That was not needed necessarily to fund the deal but they were very eager to continue to participate in the growth going forward. And from our perspective, it's great to have an influential family in West Texas to be part of the ride. I think that's something that tends to accrue to you or benefit over time. Now wrapping up with capital allocation on a go-forward basis, M&A will continue to be the go-forward priority for deploying free cash flow. We have shown our ability to acquire surface between 8 to 12x and blend that down very, very quickly. As a reminder, the surface that we bought we were able to 1.5x rather grow EBITDA 150% year-over-year roughly. So ultimately, we're really not focused on looking at just that entry multiple, although the value proposition includes that. We want to know where can we get this and work and we get this quickly? And does it create or does it have that same kind of long-term option or growth potential that our base asset has again, that 2024 vintage acreage, I think, is a great reflection of how we're able to drive or extract value out of this surface in a very quick time period. Now in terms of returning capital to shareholders, we have a modest dividend today. We are not looking to ramp that up beyond a modest dividend going forward. For the reasons discussed, we feel there is much more value to be created through M&A than there is through dividends. We did recently approve a share buyback program. We will look to execute on that opportunistically. We still believe that M&A is going to be the best way to create value -- but should we see our stock trade levels where it is competitive with M&A, that would be an avenue we would be willing to explore. From a balance sheet perspective, again, looking to stay kind of in the mid-2s, comfortable flexing into the low 3s for the right growth. We think the business can certainly support much more than that, but not looking to overly stress the balance sheet. Now we've talked about a lot today, ultimately, what can this lead to? And I guess I preface this slide by saying we're not intending to provide decade out guidance, nor would I really even classify this as a goal. And the reason being is I think we have a lot of conviction on our side that we can outperform this over the long run. But we did want to illustrate what the impact could be of our business model with even a conservative growth assumption over the next decade. And so if you look at just a 15% organic growth rate, which is very conservative relative to what we've been able to execute on historically, as we show at the bottom there, you can see EBITDA growing from roughly the $200 million run we're at today to $750 million. The immediate question we asked -- we get asked is what is comprised in that $750 million. And we've talked through a lot of it today. David spoke to the 5-plus million barrels a day of poor space capacity we have that we expect to be utilized here over the course of the next decade. That's $300 million of free cash flow to the business before taking into account CPI escalators before taking into account what we expect to see in terms of rate hikes as that scarcity value continues to play out. In addition to that, what we have executed today and what is under discussion today, a minimum of $50 million of additional clean energy and related ancillary projects that we expect to come online over the next 5 to 10 years. And so you're looking at $350 million of free cash flow potential. That's not including cost hikes. That's not including CPI escalators. That's not including the oil and gas activity needed to generate that water -- that's not including any of the other opportunities that are currently being worked through on the clean energy and certainly the digital intrasite and that's an incredible growth ramp in and of itself fully insulated from the data center thematics. Now you introduce the digital infra piece, you introduced the power piece at scale for data centers, as David has mentioned, several hundred million dollars of free cash flow potential, you could see even if we land 1 or 2 of these campuses of scale over the next decade, we would easily eclipse that $750 million number. Now what does that imply from a surface use economic efficiency standpoint. You can see to the right, we clear the low end of that spectrum at $2,500 an acre again, we think that we'll be able to outperform that both from a service use economic efficiency standpoint as well as just a broader EBITDA growth standpoint. Now on the right-hand side, we're just referencing what can this look like with M&A? conservatively saying $25 million of EBITDA acquired per year funded with debt never stresses the balance sheet just given the cash flow nature -- cash flow heavy nature of the business. And you could see the growth could meaningfully eclipse what it's even showing on an organic basis. And so ultimately, like what I would leave you all with here, and it's in response to a question I get frequently is -- when you think through valuation, this is not a business where you can just slap a multiple on it. This is not a business where you can say this is the yield today. That's the wrong way to think about it. I would encourage everyone to do the work. I think through the fundamentals, think through what's happening in West Texas, think through all of the pieces and then look at our business, look at what we're enabling, look at the financial model that we have in place and the free cash flow that's generated as a result of all of these macro tailwinds and look at the DCF, do the work because what you'll see, I think, over the next decade is substantial growth and with that little bit of work, I think you'll find that Landbridge is an incredibly unique, albeit a very compelling investment opportunity. That's all I've got David

Any other question, that's a great way to wrap it up. Let's take -- we'll go to a Q&A session to.

I think the original data center option that you guys signed 1.5 years ago is still in the due diligence phase. Just given all this opportunity, given how well you know everything, can you just help us understand like why it's taking this long. I think the shot clock ends this December would have thought with all this stuff, you guys would have had it locked up. But just sort of curious what's going on that's taking it so long to get this initial data center signed.

So that's our joint venture with a Silver Lake portfolio company, Commonwealth Asset Management. And they have a portfolio of data center locations, their marketing and our Saragosa sites on. We have -- from our active perspective, we're marketing our 100% sites, not our 50% sites. So for that one -- for their part of that to be successful, they will bring it to the fore. And that's why we focused our attention on Power Bridge and moving to achieve greater build-out a greater build-out and a greater creation of that powered campus strategy with a --

So that one, the original JV 1 doesn't sound likely then.

I don't know if it's not likely, it is still in the inventory that they market. So the Silver like portfolio company continues to market that inventory. -- my expectation is that they won't be the driver of bringing activity to West Texas. But as we start bringing activity to West Texas, they have a solution, and they will be able to offer that.

So from a financial standpoint, Scott, if that falls out of bed. I can't remember. Are you guys clipping a lease from them a coupon or there out of bed, there's no negative impact to you guys.

That's exactly right. There was a onetime 2-year option payment that was made in Q4 of 2024. It's already been paid. And so there's nothing else on a go-forward basis that's been contemplated from that in terms of what we've included in guidance or what we're showing here.

And then just one final thing on the data centers. Everyone's hunting for, everyone wants them. But presumably, when you guys announced something, it's -- you announce it once you already have an end user locked up who's committed to it. So it almost sounds like more -- the issue now is locking up the end user, the hyperscaler to use that versus everything else involved. That seems to be -- that end user seems to be the key to these projects being announced versus anything else.

I actually think if you look at the way Alex described the Berwick, Pennsylvania model, it's closer to that. We are creating the opportunity in advance of the signed up hyperscaler power purchase agreement. So we may be well down the road in construction of both the electrical private use network plus the power the on-site power at the time that the actual PPA is signed. We have enough conviction to move forward without it is the answer. And if you listen to Alex, I don't know, it was subtle but an important point where he had 0 interest in his facility until it was done. And when it was done, you heard it was a feeding frenzy. So we expect the same dynamic here. But with likely more milestones that will enable us to see higher and higher probabilities of success.

I'd love to just hear a little bit more about how the M&A market is progressing. You guys have been buying other quarter 5 or 6 years now. You're also talking about pretty sizable kind of revenue per acre targets, so I'd just be curious if that's changed kind of the conversation now that your sellers have an idea of the opportunity set in front of them in front of you?

Not necessarily. I mean, I think there are there are still a number of sellers out there who are just candidly not looking to pursue this type of business actively. I mean, I would argue a lot of the service you bought in 2024 is a great example of that. I mean they were in hands of folks who were not unsophisticated by any means, and there's one sophisticated E&P, there was another gentleman who owned a big surface position as well as the minerals. And when you're when you're making $100 million a year of passive income like your incentive to get up every day and try to get more starts to taper off, at least so until -- and -- and so when you think through like the dynamic that leaves, especially to the extent folks own the minerals, that's fantastic. Let me keep the minerals, let them keep that passive income stream. Sell to us, we can accelerate the development of the minerals. We can write them a check. It helps with their estate planning oftentimes. And they don't have to go boots on the ground and try to win business and compete with us. And so it's just -- it's a foreign dynamic for a group of people who are like used to being like how much more can I get out of something, but it's a real dynamic. So I mean I think there's that. And then these also weren't done people. I mean they see what we're doing and they're asking themselves like, "Oh, maybe I can get a little more. But there's still very much that valuation arbitrage that exists in terms of how people think through dollar per acre versus free cash flow. And oftentimes, there's a disconnect there that works in our favor. And then on top of that, if sellers think that they are getting one over on us by having us overpay like it's kind of what I was saying earlier, we almost say we don't care, but it's almost immaterial what an asset is doing from a cash flow perspective when we buy it because we're asking ourselves what does it look like in 2 years. And as long as it makes sense in 2 years, and we have high conviction that we get there, it's a great win for us. And it's a great win for the seller. So I mean, it keeps our reputation very positive in West Texas, which is critical, but it also allows us to continue to execute on these type of very accretive deals.

It's just ecosystem creates much, much more value for us than others. So there's others that will try to compete and large hedge funds will go race around and bother these branches, and that will be even better for us because -- some of them might get their feet shot. And they may have even more colorful outcomes. But what we found is it's very hard for a New York hedge fund to justify paying 14x a piece of land. -- what does that even mean 14x a piece of land. Okay, I can see land bridge trades at a higher number than that and CPL higher still. But what return am I going to get is the hedge fund. I mean, it's pretty low unless you know what you're going to do with it. So we come in and say, okay, 14x maybe too expensive and something we never pay. But 14x may look to us like 5 to 6 in 2 years and at 5 to 6, that's pretty attractive, and we can envision ourselves doing that all day long. -- for every piece of land that we can do that with.

I mean, our ability to commercialize the surface goes beyond just the relationship because it's just beyond the water bridge synergies. I mean this is -- this is a very thoughtful, intentional process. I mean -- and I think David's demonstration with GIS today is a fantastic example of that. I mean we stepped in with an enormous amount of intelligence before we do an acquisition. We're able to leverage all of that intelligence as we work through the commercial effort. Like you can't expect West Texas land or to have those kinds of resources to be able to go out there and now compute us.

Absolutely. A quick follow-up is, I think at the time of the IPO, the focus is entirely -- largely entirely on the state line, given the poor space issues, New Mexico women, et cetera. the digital infrastructure piece, letting you guys kind of showcase more of the Southern Delaware piece at this point. How is that changing kind of where you are thinking about looking at expanding the abridge footprint?

Yes. I mean I think we think about it on multiple fronts, right? I mean you've got the digital infrastructure side and there's certain land for certain reasons that make sense to continue make acquisitions. And the poor space is something we're highly focused on. And we're really able to leverage, as I said earlier, the WaterBridge geological and engineering team to find new areas of port-based that because of the growth we know WaterBridge is going to have and other third parties really expand upon that footprint where nobody is really penetration I want put my cards out there, but we've got -- we've identified some really good areas that we think that we can be highly successful in.

Do that continues just to be Delaware at this point?

I think we -- again, I say too much, but we will continue -- we find opportunities outside of the deal absolutely exploit them. it will create a whole new growth trajectory. There's the opportunities today that exist in the Delaware are robust.

You guys have a great -- I'm looking at your Slide 15, I know you guys have a great Slide 51, where you walk through how like the legacy acreage, you've grown the revenue per acre. If you guys can maybe just qualitatively talk about on the 2024 and 2025 acquisitions where you've organically grown those vintages? Like where was the lowest hanging fruit? There was the biggest opportunity and kind of that a lot of you guys at scale the revenue per acre so quickly.

Yes. I mean both of those acquisitions, Froman and VTX, again, it was large landowners who -- 1 of them, the Wolfbone deal with BTX being a producer on -- so the E&P company owned the actual surface when they bought the asset. So they had no reason to bring in third parties to drive more value. Of course, us taking that over, whether that's adding water infrastructure, adding additional gas plants, pipelines, et cetera, we will be able to be very successful on that front. As you look at Fripan, Scott talked to you. This is -- that's staline ranch. Yes. This is a landowner that I've been dealing with for years we've been trying to buy and Scott made some really valid points on why it made sense for him to sell at that point. But we looked at that as both from where it sits as a relation to the stay line, but also the the roads and highways that run from New Mexico to Texas were very important as we think about other uses. And then geologically, right, I mean, we did a very in-depth study of both the Delaware Basin, what you're showing out there is that is the sour gas window, you've got an area where you've got Capitan Reef. The disposal is not an option for others it is for us. And then as you move up in the Central Basin Platform that offered up another solution that was out of basin, so those are really good case studies on how we can expand on that. And what you'll see going forward with the Speedway pipeline is this massive water volume growth as those phases come online.

It was mentioned earlier that it's possible to realize $300 million of free cash flow in the next 5 years from the port space business. And I'm not trying to get you to set long-term guidance, but if you achieve that, that's like a 28% CAGR over free cash flow and a durable growing free cash flow stream like that has a lot of value. Then I look at the data center business, which is still proof concept, that seems more like a call option and look at how you trade, it looks like the stock price trades based on sentiment of when the data center business goes from proof of concept to execution phase. So how do you think long-term investors should balance between the valuations of those 2 businesses?

No. I think you hit the nail on the head, right? I think there's so much value to be had before you even start talking to data centers. And when we talk through those 5 million-plus barrels a day of poor space, I don't think it will take us 10 years to utilize those when I think through that 15% CAGR. I think that's -- it's easy to say that's front weighted based on what we have line of sight to today, but I would caveat that with it doesn't mean it's going to slow down on the back end. It's just what we have in [indiscernible]. And so the point I was trying to make on that final slide is encouraging folks to do the work and see how that looks because the financial impact of compounding free cash flows over time with that kind of growth profile is enormously powerful. -- unlike what I think most folks, particularly folks have an energy slanted in the past have ever seen. And I think you'll see that there is a tremendous amount of value that we deliver to shareholders before we even start talking data centers. if you want to layer in data centers on top of that, it's very easy to see. I think also to your point, that you could almost view that as a cheap but not free option relative to what the value of the business is before you start having that discussion.

Exactly. If I were doing the valuation myself today, first and foremost, I would look at what happens before the data centers. as soon as we do the first one, you can extrapolate that a long, long way. So you'll have plenty of time to do that work. But if you look at it prior to that, I mean, you've talked about doubling and tripling the size of our company by utilizing everything outside of data centers. And I think that's something that can get missed if you focus on the shiny object, but that's our business, and we are in the best position in the whole of the Delaware and the whole of the Permian Basin to exploit that opportunity.

Yes. I mean we grew from $97 million of EBITDA in 2024 to $177 million of EBITDA in 2025 without 0 from data center payments. That's powerful. And look through the dynamics, look through the tailwinds that we have right now working to our advantage. This is a fantastic business, before you even layer on all of the upside that comes with digital and from the power associated with it.

Just circling back -- if you're doing sort of build it and they will come on the data centers, the mindset of make it sound so risky I've seen a lot of real estate proposals that are still proposals. So forgive me, a scar tissue. From a land bridge perspective, Scott, the mantra is whether it's a 5-point led deal or a true independent deal. If someone wants to build something on your land, they got to pay cash upfront. There's no hope notes. There's no hope certificates, it's whatever it is, whether it's a related party transaction or a third party, they pay you cash upfront before they even drive their trucks onto the land to start doing whatever they're doing.

Yes, we have a very robust conflict committee process that enables the protection of land bridge in favor of water, Landbridge vis-a-vis WaterBridge Landbridge vis-a-vis Power Bridge -- so there's an absolute market for what we're doing, and Landbridge will get every bit of that market value. Now it wouldn't shock me if some accommodations may have to be made on the very first one. wouldn't shock me, but maybe not, we'll see. But I would say things get more profitable over time, not less.

Yes. And the layers are begging me to flag that we're wrapping up that conflict committee process with Power Bridge at the moment, but that's not across the finish line just yet. But to Dave's point, it will be arm's length. There's no freebies, -- there's no gives that is is very much treated....

like where we saw that upfront payment with the initial deal with Silver , is that a sort of template for another one? Or no, that's not a template. We shouldn't expect that on future.

I can't really speak to the exact structure of our latest 1 between Power Bridge and Land bridge, but there will be both preconstruction payments, post-construction payments and then fully up and running payments -- how it all plays out. Sure. Okay. Well, again, we appreciate everyone joining us here in person today as well as everyone on the webcast. We always appreciate the support. I appreciate the engagement. Please feel free to reach out with follow-up questions. We obviously were talking about the business, and we're happy to engage with you all. But thanks again. Thank you.

Thank you.