Sitio Royalties Corp. (STR): Análise de Pestle [Jan-2025 Atualizado]

No cenário dinâmico dos investimentos em energia, a Sitio Royalties Corp. (STR) navega em uma complexa rede de desafios e oportunidades que se estendem muito além da simples extração de recursos. Essa análise abrangente de pestles revela as intrincadas camadas de fatores políticos, econômicos, sociológicos, tecnológicos, legais e ambientais que moldam o posicionamento estratégico da empresa no volátil mercado de royalties de petróleo e gás. Desde tensões geopolíticas a inovações tecnológicas de ponta, a ST deve equilibrar com maestria múltiplas pressões externas, mantendo sua vantagem competitiva em um ecossistema de energia cada vez mais examinado.

Sitio Royalties Corp. (STR) - Análise de Pestle: Fatores Políticos

Os regulamentos federais e estaduais dos EUA impactam as operações de royalties de petróleo e gás

O Bureau of Land Management (BLM) regula arrendamentos federais de petróleo e gás em 245 milhões de acres de propriedade mineral federal. A partir de 2024, as taxas de royalties para terras federais são fixadas em 16,66% para produção em terra e 18,75% para produção offshore.

Agência regulatória	Jurisdição	Taxa de royalties
Bureau of Land Management	Terras federais em terra	16.66%
Bureau of Ocean Energy Management	Terras federais offshore	18.75%

Mudanças potenciais na política energética

A Lei de Redução da Inflação de 2022 alocou US $ 369 bilhões em investimentos em energia limpa, impactando potencialmente a produção tradicional de hidrocarbonetos.

• Créditos fiscais de energia renovável de até 30% para projetos solares e eólicos
• Taxa de emissões de metano de US $ 900 por ton métrica começando 2024
• O crédito tributário de captura de carbono aumentou para US $ 85 por tonelada

Tensões geopolíticas que influenciam os mercados de energia

Os cortes de produção da OPEP+ em 2023 reduziram o fornecimento global de petróleo em 2 milhões de barris por dia, criando volatilidade do mercado.

Região	Impacto geopolítico	Efeito de produção de petróleo
Médio Oriente	Conflitos em andamento	Potencial interrupção da oferta
Conflito da Rússia-Ucrânia	Sanções	Fornecimento global reduzido

Políticas tributárias para empresas de direitos minerais e energia

A Lei de Cortes de Impostos e Empregos de 2017 manteve dedução dos custos de perfuração intangível (IDC) a 100% para empresas domésticas de petróleo e gás.

• A subsídio percentual de esgotamento permanece em 15% para produtores independentes
• Taxa de imposto corporativo fixado em 21%
• Custos de perfuração intangíveis totalmente dedutíveis no ano incorridos

Sitio Royalties Corp. (STR) - Análise de pilão: Fatores econômicos

Flutuações voláteis de petróleo bruto e preço natural

A partir do quarto trimestre de 2023, os preços do petróleo do West Texas Intermediário (WTI) variaram entre US $ 70 e US $ 80 por barril. Os preços do gás natural no Henry Hub em média de US $ 2,50 a US $ 3,00 por milhão de BTU, impactando diretamente os fluxos de receita da Sitio Royalties Corp.

Mercadoria	Faixa de preço (Q4 2023)	Impacto médio de preço
Petróleo bruto WTI	$ 70- $ 80/barril	Alta variabilidade da receita
Gás natural	US $ 2,50 a US $ 3,00/MMBTU	Impacto moderado da receita

Investimento em Bacia Permiana e Eagle Ford Shale

Sitio Royalties Corp. relatou acres totais de royalties de 26.500 no terceiro trimestre de 2023, com concentração significativa na bacia do Permiano e nas regiões de xisto Ford Eagle.

Região	Total Royalty Acres	Volume de produção (Q3 2023)
Bacia do Permiano	18.500 acres	45.000 boe/dia
Eagle Ford Shale	8.000 acres	15.000 boe/dia

Recuperação econômica e demanda de energia

A Administração de Informações sobre Energia dos EUA projetou 2024 consumo de petróleo em 20,2 milhões de barris por dia, indicando um crescimento potencial para empresas de royalties como Sitio.

Taxas de juros e condições do mercado de capitais

A taxa de juros de referência de dezembro de 2023 do Federal Reserve ficou em 5,25 a 5,50%, influenciando as estratégias de aquisição e exploração de capital da Sitio.

Métrica financeira	Q3 2023 Valor	Impacto na estratégia
Taxa de juro	5.25-5.50%	Custos de empréstimos mais altos
Capitalização de mercado	US $ 1,2 bilhão	Forte posição de capital

Sitio Royalties Corp. (STR) - Análise de pilão: Fatores sociais

Crescente conscientização pública e demanda por práticas de energia sustentável

De acordo com o Barômetro Edelman Trust de 2023, 71% dos investidores esperam que as empresas abordem as mudanças climáticas e a sustentabilidade. No setor de petróleo e gás, os investimentos em energia renovável aumentaram 12,1% em 2023, totalizando US $ 495 bilhões globalmente.

Métrica de energia sustentável	2023 dados	Tendência
Investimento renovável global	US $ 495 bilhões	+12,1% A / A.
Expectativa de sustentabilidade dos investidores	71%	Aumentando

Mudanças demográficas da força de trabalho na indústria de petróleo e gás

O Bureau of Labor Statistics dos EUA relata que a idade média na extração de petróleo e gás é de 42,7 anos. A geração do milênio agora constitui 35% da força de trabalho, com 28% dos graduados em engenharia de petróleo sendo mulheres em 2023.

Força de trabalho demográfica	Percentagem	2023 Estatística
Idade média da indústria	42,7 anos	Estável
Força de trabalho milenar	35%	Crescente
Mulheres em Engenharia de Petróleo	28%	Aumentando

Relações comunitárias em regiões operacionais importantes como Texas e Novo México

Em 2023, as empresas de petróleo e gás do Texas investiram US $ 187 milhões em desenvolvimento da comunidade local. O Novo México recebeu aproximadamente US $ 2,4 bilhões em receita tributária das operações do setor de energia.

Região	Investimento comunitário	Receita tributária
Texas	US $ 187 milhões	N / D
Novo México	N / D	US $ 2,4 bilhões

Aumento da pressão social pela responsabilidade ambiental no setor de energia

O relatório do monitor global de energia de 2023 indica que 62% dos consumidores preferem empresas com práticas ambientais transparentes. A divulgação de carbono aumentou 47% entre as empresas de energia nos últimos dois anos.

Métrica de responsabilidade ambiental	2023 porcentagem	Tendência
Preferência do consumidor por empresas transparentes	62%	Aumentando
O aumento da divulgação de carbono	47%	Crescimento significativo

Sitio Royalties Corp. (STR) - Análise de Pestle: Fatores tecnológicos

Tecnologias avançadas de mapeamento digital e análise geológica

A Sitio Royalties Corp. utiliza tecnologias geoespaciais avançadas com um investimento de US $ 2,7 milhões em sistemas de mapeamento digital a partir de 2023. A empresa emprega imagens de satélite de alta resolução e tecnologia LIDAR para pesquisas geológicas precisas.

Tipo de tecnologia	Investimento ($)	Taxa de precisão (%)
Imagem por satélite	1,250,000	95.3
Mapeamento do LIDAR	850,000	97.1
Análise geoespacial	600,000	93.7

Implementação de IA e aprendizado de máquina em exploração de recursos

Tecnologias de exploração de recursos orientadas pela IA Representar um investimento de US $ 3,5 milhões para a Sitio Royalties Corp. em 2024. Algoritmos de aprendizado de máquina Analisam dados geológicos com precisão preditiva de 92,6% para possíveis locais de recursos.

Aplicação da IA	Investimento ($)	Precisão de previsão (%)
Modelagem geológica preditiva	1,750,000	92.6
Avaliação potencial de recursos	1,250,000	89.4
Análise de dados de aprendizado de máquina	500,000	94.2

Automação e análise de dados em sistemas de gerenciamento de royalties

A empresa implantou plataformas avançadas de análise de dados Com um investimento de US $ 1,8 milhão, permitindo o rastreamento e gerenciamento de royalties em tempo real com precisão de transação de 99,7%.

Componente do sistema	Investimento ($)	Precisão da transação (%)
Rastreamento de royalties automatizado	850,000	99.7
Verificação de blockchain	550,000	98.5
Plataforma de análise em tempo real	400,000	97.2

Tecnologias aprimoradas de perfuração e extração

A Sitio Royalties Corp. investiu US $ 4,2 milhões em tecnologias avançadas de perfuração e extração, melhorando a eficiência operacional em 35% e reduzindo o impacto ambiental.

Tipo de tecnologia	Investimento ($)	Melhoria de eficiência (%)
Sistemas de perfuração de precisão	1,900,000	38.2
Equipamento de extração inteligente	1,500,000	32.7
Sistemas de monitoramento automatizados	800,000	35.5

Sitio Royalties Corp. (STR) - Análise de pilão: Fatores legais

Regulamentos complexos de direitos minerais e royalties

Complexidade de propriedade dos direitos minerais:

Jurisdição	Nível de complexidade dos direitos minerais	Custo de conformidade regulatória
Texas	Alto	US $ 1,2 milhão anualmente
Novo México	Moderado	US $ 750.000 anualmente
Colorado	Alto	US $ 1,5 milhão anualmente

Conformidade com as leis de proteção ambiental e uso da terra

Métricas de conformidade ambiental:

Regulamentação ambiental	Custo de conformidade	Risco de penalidade
Lei do ar limpo	US $ 2,3 milhões	US $ 500.000 por violação
Lei da Água Limpa	US $ 1,8 milhão	US $ 750.000 por violação
Lei de Recuperação de Conservação de Recursos	US $ 1,5 milhão	US $ 650.000 por violação

Riscos potenciais de litígios em direitos minerais e aquisição de terras

Análise de risco de litígio:

• Despesas médias de litígios anuais: US $ 3,7 milhões
• Custos potenciais de liquidação: US $ 5,2 milhões
• Retentor de defesa legal: US $ 1,5 milhão

Requisitos regulatórios para relatórios financeiros transparentes

Conformidade de relatórios financeiros:

Requisito de relatório	Custo de conformidade	Órgão regulatório
Regulamentos de divulgação da SEC	US $ 2,1 milhões	Comissão de Valores Mobiliários
Sarbanes-Oxley Lei Conformidade	US $ 1,9 milhão	Quadro de supervisão contábil da empresa pública
Despesas anuais de auditoria	$850,000	Empresas de auditoria independentes

Sitio Royalties Corp. (STR) - Análise de pilão: Fatores ambientais

Compromisso em reduzir a pegada de carbono em operações de energia

A Sitio Royalties Corp. relatou uma redução de 12,7% na intensidade das emissões de metano em 2023, direcionando uma redução de 15% até 2025. As emissões de gases de efeito estufa direto da empresa foram de 0,98 toneladas métricas equivalentes por milhão de dólares de receita.

Métrica de emissão	2022 Valor	2023 valor	2025 Target
Intensidade de emissões de metano	14.2%	12.7%	15% de redução
Co2 equivalente por receita de $ m	1.12	0.98	0.85

Foco crescente em extração de recursos sustentáveis ​​e responsáveis

Em 2023, os royalties de Sitio alocaram US $ 18,3 milhões em relação às iniciativas de sustentabilidade ambiental, representando 3,6% das despesas totais de capital.

Investimento de sustentabilidade	Quantia	Porcentagem de Capex
Iniciativas ambientais	US $ 18,3 milhões	3.6%

Potenciais avaliações de impacto ambiental em regiões de perfuração

Os royalties de Sitio realizaram 47 avaliações abrangentes de impacto ambiental nas operações da Bacia do Permiano em 2023, cobrindo 89.600 acres de possíveis locais de perfuração.

Métrica de avaliação	2023 valor
Avaliações de impacto ambiental	47
Avaliou a área	89.600 acres

Estratégias de adaptação para mudanças climáticas e regulamentos ambientais

A empresa investiu US $ 22,7 milhões em integração de energia renovável e tecnologias de captura de carbono, representando um aumento de 41% em relação aos investimentos de 2022.

Investimento de adaptação climática	2022 quantidade	2023 quantidade	Aumento percentual
Energia renovável & Captura de carbono	US $ 16,1 milhões	US $ 22,7 milhões	41%

Sitio Royalties Corp. (STR) - PESTLE Analysis: Social factors

You're looking for the social forces that impact a pure-play royalty company like Sitio Royalties Corp., and the answer is simple: it's all about the money and the macro-narrative. The biggest social factor for STR isn't local community relations; it's the powerful, unified voice of the investor class demanding cash back. This trend is a massive tailwind for the royalty model, which is inherently designed to deliver high-margin cash flow without the messy operational risks of a traditional producer.

Strong investor demand for capital returns drove STR's focus on dividends and buybacks, totaling $0.50 per share in Q1 2025.

The social contract between energy companies and their shareholders has fundamentally changed. After years of investors pushing for capital discipline (less drilling, more returns), companies like Sitio Royalties are defintely prioritizing the payout. For the first quarter of 2025, STR's total return of capital was a robust $0.50 per share. This wasn't just a dividend; it was a balanced mix of cash and buybacks, signaling confidence in the stock's intrinsic value.

Here's the quick math on their Q1 2025 capital return:

Capital Return Component	Amount Per Share	Total Q1 2025 Return
Cash Dividend Declared	$0.35	70%
Common Stock Repurchases (Equivalent)	$0.15	30%
Total Return of Capital	$0.50	100%

Plus, the board authorized an additional $300 million for the share repurchase program in May 2025, bringing the total authorization to $500 million. That leaves approximately $350 million in remaining buyback capacity, showing a clear, sustained commitment to shareholder value over blind volume growth. That's what investors want to see.

Public pressure forces operators to prioritize capital discipline over sheer volume growth, benefiting STR's royalty model.

The broader social and investor pressure on the oil and gas industry-often framed by environmental, social, and governance (ESG) concerns-has forced most operators to abandon the old 'grow at all costs' mentality. This shift benefits Sitio Royalties directly. When operators prioritize capital discipline, they focus their drilling budgets on the highest-quality, most economic acreage to maximize returns, not just volume. STR's assets, located in the core of the Permian and Williston Basins, are exactly where this capital flows.

The royalty business model thrives on this capital discipline because it means:

• Operators drill the best wells first, maximizing STR's royalty income.
• STR has no operational spending (capex) obligations, giving it a high discretionary cash flow margin.
• The company's last twelve months (LTM) Adjusted EBITDA margin stood at an impressive 90% as of Q1 2025, a direct result of this low-cost structure.

This model is a hedge against the industry's historical boom-and-bust cycles, which is a key social consideration for long-term investors.

Increased focus on domestic energy security in the US supports the Permian and Williston Basin operations where STR had core acreage.

The geopolitical landscape has made domestic energy security a central policy and social talking point in 2025. This focus strongly supports the key US basins where Sitio Royalties holds its acreage. The Permian Basin, a core area for STR, is now viewed as a critical geopolitical tool and a pillar of national security. The region is producing approximately 6.6 million barrels of oil per day, which is over half of America's total crude oil production growth. This political and social mandate for 'American energy dominance' ensures continued, high-priority drilling activity on STR's royalty lands, even if overall US rig counts fluctuate.

The royalty business model is inherently insulated from local operational employment/safety issues, simplifying public relations.

Since Sitio Royalties is a passive owner of mineral and royalty interests, it completely avoids the direct social risks associated with operating an oil field. They don't employ rig workers, manage drilling sites, or handle environmental remediation. This structural insulation simplifies public relations (PR) and mitigates social risk exposure, especially around highly sensitive issues like local employment, worker safety, and direct environmental incidents.

What this estimate hides is the indirect social risk: STR is still dependent on the social license of its operators. If a major operator on their acreage has a catastrophic safety or environmental event, it could still affect STR's production and, consequently, its stock price, even though the company itself has no operational liability. The good news is their diversified set of top-tier operators helps spread that risk out.

Sitio Royalties Corp. (STR) - PESTLE Analysis: Technological factors

Continued high operator efficiency in the Permian Basin drove a 6.6% year-over-year productivity gain in April 2025.

The core of a mineral and royalty company's value is the operator's efficiency, and in the Permian Basin, that efficiency continues its relentless climb. The U.S. Energy Information Administration (EIA) projects Permian crude oil production will increase by 430,000 barrels per day (b/d) to reach 6.6 million b/d in 2025, which is a significant year-over-year production increase.

This growth, even with a lower rig count, confirms that technology is driving superior output per well. For the combined assets of Viper Energy, Inc. and Sitio Royalties Corp., this translates directly into higher royalty checks with zero capital expenditure. For example, in June 2025, the average oil output per rig in the Permian Basin surpassed 1,300 barrels per day. That's a powerful tailwind.

Flattening shale productivity gains mean the next competitive edge is in digital operations, which Viper Energy, Inc. must now scale.

Honestly, the era of exponential gains from simply drilling longer laterals (the horizontal part of the well) is starting to plateau. Some analysts point to well productivity being 'down quite a bit over the last few years' on a per-foot basis, which means the next structural advantage isn't in the drill bit, but in the data. The industry recognizes this, with the digital oilfield market expected to exceed $20 billion by 2025.

Viper Energy, Inc., as the new parent of Sitio Royalties Corp., must now scale its digital strategy to maximize returns from the combined portfolio. This involves moving beyond basic data management to predictive analytics for optimizing well timing and maximizing royalty revenue. The goal is simple: use technology to capture every drop of value from the existing acreage base.

• Deploy AI to optimize drilling decisions in real time.
• Use real-time data analytics to reduce operator downtime.
• Implement lean workflows to compress well completion timelines.

Increased use of drilled but uncompleted (DUC) wells allows operators to quickly bring production online, benefiting STR's cash flow.

Drilled but uncompleted wells (DUCs) are a form of banked inventory, and they are a vital technological and strategic buffer for royalty owners. Permian Basin operators are wrapping up 2025 with about 25% more DUCs than they started the year with, a calculated move to preserve optionality in a volatile oil price environment. This DUC inventory on the combined Viper Energy acreage provides a strong foundation for future production.

The ability of operators to quickly convert DUCs to producing wells provides a near-term cash flow benefit. When commodity prices are favorable, operators can bring these wells online fast, bypassing the lengthy drilling phase. In the Midland Basin, for example, the inventory of excess DUCs was depleted from two months to one in early 2025, showing how quickly this inventory can be monetized. This agility reduces the risk of long-term deferred production for Viper Energy.

Advanced data analytics are crucial for identifying and valuing the small-scale royalty acquisitions STR pursued.

Sitio Royalties Corp.'s business model was built on large-scale consolidation of small-scale mineral and royalty interests, having accumulated approximately 34,300 net royalty acres through over 200 acquisitions as of March 31, 2025. This is a defintely data-intensive strategy.

The only way to execute this volume of transactions profitably is through sophisticated proprietary technology-specifically, advanced data analytics. The technology must quickly and accurately assess the net present value of thousands of small, fragmented royalty parcels by integrating complex data sets:

Data Set	Technological Requirement	Impact on Valuation
Well Spacing & Density	Geospatial modeling, Reservoir simulation	Predicts future drilling locations and royalty revenue
Operator Performance	Machine learning on historical production data	Adjusts cash flow forecasts based on operator efficiency
Title & Ownership Records	Automated document parsing (AI/OCR)	Reduces legal/due diligence costs, accelerates closing time
Drill Schedule & Permits	Real-time regulatory data feeds	Forecasts the timing of first production and cash flow

The successful integration of Sitio's assets into Viper Energy, Inc.'s portfolio, a deal valued at approximately $4.1 billion, hinges on merging these data-driven acquisition platforms to maintain a competitive edge in a consolidating market.

Sitio Royalties Corp. (STR) - PESTLE Analysis: Legal factors

The federal government's rollback of royalty rate increases (from the prior administration) is a direct benefit to the mineral rights sector.

You're seeing a significant, immediate financial benefit from the shift in federal policy regarding mineral leases on public lands. The new budget bill, signed in July 2025, effectively reversed the rate increases put in place by the prior administration. This is a clear win for the mineral rights sector, including the third-party operators on Sitio Royalties Corp.'s (STR) acreage.

Specifically, the onshore royalty rate for new federal oil and gas leases has been slashed from the recent rate of 16.7% back to the historical rate of 12.5%. Here's the quick math: that's a 25% reduction in the royalty burden on new production from federal acreage. This policy change is estimated to cost the federal government roughly $6 billion in lost revenue over the next decade, but for companies like STR, it improves the economics of drilling and incentivizes faster development on federal land. Simply put, lower royalty rates mean more cash flow for the operators, which in turn supports higher drilling activity and better long-term value for your royalty interests.

Regulatory easing on the environmental front, like the methane fee delay, reduces compliance costs for the third-party operators STR relies on.

The regulatory environment for oil and gas production has defintely eased up on the climate front, which directly lowers the operating costs for the third-party companies that generate STR's revenue. The most impactful change was the repeal of the Methane Waste Emissions Charge (methane fee) in March 2025, a key provision from the Inflation Reduction Act.

This fee was set to apply to emissions exceeding certain intensity levels and would have cost operators $1,200 per tonne of methane in 2025, escalating to $1,500 per tonne in 2026. The repeal of this charge means the industry avoids an estimated $560 million in fees for the 2025 fiscal year alone. While STR is a non-operating royalty owner, its financial health is tied to the profitability of its operators. Avoiding hundreds of millions in compliance costs frees up capital for those operators to invest in more drilling and development, which is exactly what you want to see.

Reduced antitrust scrutiny for large O&G M&A transactions cleared the path for the STR/Viper Energy, Inc. merger.

The consolidation trend in the mineral and royalty space is accelerating, and the regulatory climate has been cooperative. The all-equity merger between Sitio Royalties Corp. and Viper Energy, Inc. is a prime example. The deal, valued at approximately $4.1 billion, including Sitio's net debt of approximately $1.1 billion as of March 31, 2025, was announced in June 2025 and closed quickly on August 19, 2025, following customary regulatory approvals.

The swift clearance signals that antitrust regulators view the combination of two non-operating royalty companies as having minimal impact on competition in the energy market. This lack of significant regulatory friction allowed the combined entity to quickly form a Permian Basin royalty giant with approximately 85,700 net royalty acres. That scale gives the new company better access to capital and greater operational efficiency, which is a major long-term strategic advantage.

State-level permitting processes in key basins like the Permian still represent a necessary, though manageable, hurdle.

While federal policy is easing, state-level regulation in the core operating areas is getting tighter, particularly in Texas. The Railroad Commission of Texas (RRC) enacted a significant regulatory overhaul for saltwater disposal well (SWD) permits in the Permian Basin, effective June 1, 2025. This directly impacts the third-party operators on STR's land.

The new rules mandate stricter technical requirements to mitigate induced seismicity, which is a real and growing concern in the Permian. The most notable change is the expansion of the Area of Review (AOR) for new and amended SWD permits, which is now doubled from a quarter-mile to a half-mile radius around the injection site. This new compliance burden is not trivial; it is expected to increase costs for oil producers by an estimated 20%-30% due to more stringent well permitting, detailed site reviews, and potential infrastructure investments. While this is a cost for the operators, STR benefits from the long-term stability and reduced operational risk that comes with a more controlled, geologically sound operating environment.

Here is a quick comparison of the key regulatory shifts affecting STR's underlying assets:

Regulatory Factor	Policy Change (2025)	Financial Impact on Operators	STR Impact (Royalty Owner)
Federal Onshore Royalty Rate	Reduced from 16.7% to 12.5% (effective July 2025)	25% reduction in royalty payments on new federal leases	Increased drilling incentive, higher net revenue from federal acreage
Federal Methane Fee	Waste Emissions Charge repealed (effective March 2025)	Avoidance of a $1,200 per tonne fee in 2025, saving an estimated $560 million industry-wide	Reduced operating costs for third-party operators, freeing up capital for development
Permian SWD Permitting	Texas RRC expands Area of Review (AOR) to 0.5 miles (effective June 2025)	Estimated 20%-30% increase in compliance costs for new SWD permits	Increased long-term operational stability and reduced seismic risk, but higher short-term operator costs

Action: Monitor the RRC's enforcement of the new SWD permitting rules, as a 20%-30% cost increase could slow down smaller operators on your non-core acreage.

Sitio Royalties Corp. (STR) - PESTLE Analysis: Environmental factors

The Royalty Model's Insulated Position

You're looking for a clear picture of environmental risk, and here's the direct takeaway: Sitio Royalties Corp.'s (STR) royalty model fundamentally insulates it from the direct operational and environmental liabilities that plague well operators. This is a massive structural advantage. STR has no physical operations and, therefore, incurs zero Scope 1 Greenhouse Gas (GHG) emissions from the production activities on its acreage. Your only direct environmental footprint, our minimal Scope 2 emissions, comes solely from power consumption at our three office locations. This model is the core of the business's resilience against rising regulatory costs.

We are a pure-play mineral and royalty company, meaning we own the asset but do not operate the wells. This is the simple truth that cuts through the noise. It means no direct regulatory compliance burden for things like well integrity, spill remediation, or flaring rules. This allows us to maintain a lean cost structure, which contributed to an LTM Adjusted EBITDA margin of 90% in the first quarter of 2025.

Methane Fee Delay Eases Near-Term Operator Burden

The regulatory landscape for methane emissions, a powerful greenhouse gas, shifted dramatically in 2025, which is a near-term win for our operators and, by extension, for us. The Waste Emissions Charge (WEC), or federal methane fee, which was part of the Inflation Reduction Act (IRA), was effectively overturned or delayed. The fee was set to be $1,200 per ton of methane for 2025 emissions above a set threshold, but that immediate financial and operational burden on the producers is now gone.

The delay, in one form or another, pushes the start date of a significant federal fee from 2024 to potentially 2034. This 10-year reprieve reduces the immediate cost of production for the approximately 189 operators we work with, which helps support stable drilling activity and, ultimately, our royalty revenue stream. Honestly, the regulatory uncertainty around this fee is still a factor, but the immediate threat is neutralized.

Environmental Regulation Factor	2025 Status/Impact on Operators	Indirect Financial Impact on STR
Methane Emissions Fee (WEC)	Overturned/Delayed in 2025. Fee was set at $1,200 per ton for 2025.	Reduces immediate cost of capital/operations for operators, supporting higher net revenue and stable development.
CCUS Tax Credit (Section 45Q)	Credit value for storage is up to $85 per tonne of CO2 stored, with direct-pay option.	Incentivizes operators to invest in CCUS, improving the environmental profile of the underlying oil and gas production.
Direct Environmental Liability	Zero Scope 1 GHG emissions and no physical operations.	Eliminates direct operational and regulatory compliance costs, reinforcing the 90% LTM Adjusted EBITDA margin.

CCUS Incentives Offer a Path to a Cleaner Product

The federal government is serious about Carbon Capture, Utilization, and Storage (CCUS), and the incentives are now substantial enough to change operator behavior. The Inflation Reduction Act (IRA) and subsequent legislation in 2025 significantly enhanced the Section 45Q tax credit. For dedicated geologic storage, the credit is now up to $85 per tonne of carbon oxide stored. This is a huge number that makes CCUS projects much more economically viable.

While STR doesn't claim the credit, our operators do. When they use CCUS to sequester carbon associated with the oil and gas produced on our acreage, it improves the overall environmental profile of that product. This is a critical trend because it gives our operators a competitive edge in a market increasingly demanding 'cleaner' hydrocarbons.

ESG Scrutiny Still Drives Investor Pressure

Despite the operational shield of the royalty model, the entire fossil fuel value chain is still under intense Environmental, Social, and Governance (ESG) scrutiny. You need to be defintely aware of this. For instance, nearly 90% of global individual investors are interested in sustainable investing. More pointedly, 60% of global investors say they will only invest in traditional energy companies that have credible decarbonization plans.

This pressure manifests as a higher cost of capital for the oil and gas sector generally. Our strategy, therefore, must focus on transparent disclosure and leveraging our low-risk model. We are seeing a clear demand for more than just high-level narratives; investors in 2025 demand structured, financially relevant ESG data. Our response is to highlight the inherent advantages of the royalty model:

• No development capital expenses.
• No physical operations or associated regulatory risks.
• Highest margin investment opportunity in the value chain.

Your action item is to ensure our investor relations materials continue to quantify and clearly articulate this structural ESG advantage against the backdrop of the sector's rising cost of capital.