Simpson Thacher Advises on Inaugural $500 Million Revolving Credit Facility for Texas Pacific Land Corporation
Simpson Thacher represented Wells Fargo Bank, National Association, as administrative agent and lead arranger in connection with Texas Pacific Land Corporation’s (“TPL”) credit agreement, which establishes a revolving credit facility with initial aggregate commitments of $500 million and an incremental capacity for additional commitments of $250 million.
TPL is one of the largest landowners in the State of Texas with approximately 874,000 acres of land in West Texas, with the majority of its ownership concentrated in the Permian Basin. TPL’s surface and royalty ownership provide revenue opportunities throughout the life cycle of a well, including fixed fee payments for use of land, revenue for sales of materials (caliche) used in the construction of infrastructure, providing sourced water and/or treated produced water, revenue from oil and gas royalty interests, and revenues related to saltwater disposal. TPL also generates revenue from pipeline, power line and utility easements, commercial leases and temporary permits related to a variety of land uses including midstream infrastructure projects and hydrocarbon processing facilities.
The Simpson Thacher team included Erland Modesto, Bryce Kaufman and Ramz Aziz (Banking and Credit); and Adam Arikat (Tax).