Resource Royalty 27, LLC

Offering Overview

Resource Royalty 27, LLC offers undivided, direct-title non-possessory mineral and royalty interests across a 12-property, two-state portfolio aggregating 552.99 net royalty acres and 16,724 gross acres. The asset base concentrates in two premier basins: eight Oklahoma properties span the Anadarko complex (STACK gas window in Custer/Dewey, SCOOP/Merge in Grady, Western Anadarko oil window in Ellis/Canadian), while four Texas properties sit in the northern Permian (Borden and Dawson counties). Operatorship is held by established, well-capitalized E&P names: Surge Operating, SM Energy, Devon/Coterra, Validus Energy, Mewbourne Oil, and Camino Natural Resources, insulating royalty holders from drilling capex, lease operating expense, and plugging/abandonment liability. The thesis is current-income-led: sixteen wells are in pay status as of the March 1, 2026 effective date, with the cash-flow base supplemented by 41 proven undeveloped locations, four drilled-uncompleted wells, and multiple permitted/filed locations providing non-cost-bearing development optionality. As non-operating royalty interests, holders capture gross wellhead revenue free of operating cost, with a stated ~35-year remaining reserve life and quarterly distributions administered by Resource Royalty Property Management, LLC.

Investment Highlights

• The portfolio's revenue is underwritten by a roster of institutionally-capitalized operators rather than a single counterparty, materially diversifying drilling-pace and completion-timing risk. Surge Operating, SM Energy, Devon/Coterra, Validus, Mewbourne, and Camino each carry the full burden of drilling, completion, lease operating expense, and abandonment obligations, while the royalty interest sits at the top of the revenue waterfall, paid off gross production before operating deductions. This non-cost-bearing posture structurally eliminates the margin compression that erodes working-interest returns when service costs inflate or commodity prices soften.
• Geographic positioning in the northern Permian core (Borden/Dawson) and the multi-bench Anadarko complex provides exposure to two of the lowest-breakeven onshore U.S. resource plays. Several units sit in stacked-pay configurations: the Bennett property in the SCOOP play and the Wendigo unit in the Permian carry multiple producing horizons, amplifying recoverable reserves per royalty acre and extending the reinvestment runway as operators down-space and develop secondary benches over the hold.
• Beyond the 16 wells currently in pay, the portfolio carries a substantial undrilled inventory: 41 proven undeveloped locations, four drilled-but-uncompleted wells, one permitted and four filed new-drill locations, representing latent production growth the royalty holder captures without contributing development capital. The Merganser unit's recent completions, which came online ahead of schedule and above type-curve expectations, evidence near-term conversion of this inventory into incremental cash flow.
• The direct-title deed structure differentiates this offering from pooled fractional vehicles: each investor receives recorded mineral and royalty deeds to undivided interests rather than a beneficial interest in a trust, preserving individual control over holding period and disposition timing. Coupled with a secured tax opinion treating the royalties as real property eligible for Section 1031 exchange, the structure accommodates like-kind replacement-property needs while avoiding the co-ownership lock-in inherent to DST and TIC programs.
• A 15% statutory depletion allowance shelters a meaningful portion of distributed royalty income, enhancing after-tax yield relative to fully-taxable income streams, while the ~35-year estimated reserve life supports an extended distribution horizon decoupled from any forced disposition date. The quarterly distribution cadence, aggregated from monthly operator remittances and net of a 1% annual management fee, provides a recurring income profile suited to exchange investors prioritizing durable cash yield over terminal-value realization.

Forecasted Cash Flow

Projected annual cash-on-cash distributions with the corresponding tax-equivalent yield over the hold, based on the sponsor’s underwriting assumptions.

Illustrative projections only — targeted distributions are not guaranteed and actual results will vary. Tax-equivalent yield assumes depreciation shelter of distributed income.

Analyst Notes

On a risk-adjusted basis, Resource Royalty 27 is an unlevered, current-income royalty vehicle whose forecast 9.60% average five-year cash-on-cash sits well above stabilized core real estate yields, with the spread compensating for higher commodity and production-variability risk rather than financial leverage. The flat-price Base Range ($59-60 oil) is conservative against the April 2026 NYMEX strip embedded in the supplement ($90.82 spot 2026 declining to $59.02 to-life), implying the projections do not capture near-term upside if current futures hold, though the strip-to-life gap also signals expected price normalization. The debt-free posture is the defining structural feature in the current rate environment, fully insulating distributions from the refinancing and rate-cap pressures weighing on leveraged 1031 real estate, and shifting the entire return-variance burden onto commodity prices and operator drilling cadence. Feasibility hinges on three variables: sustained operator development of the PUD/DUC inventory, prices remaining above the Low Range floor, and the ~35-year reserve life materializing as engineered; the Merganser early-completion outperformance and the publicly-traded operator base support the first, while OPEC-, geopolitical-, and demand-driven volatility govern the second. For an exchange investor, the offering functions less as a real estate substitute than as a tax-advantaged, real-property-classified energy-income allocation with embedded development optionality and no leverage overlay.

Financing

Financing terms for this offering are summarized below.

Benchmark Comparison

Benchmark reflects the average of comparable Oil & Gas Mineral/Royalty Interests offerings. Differences are relative to the benchmark.

Offering Documents

Offering Documents Available By Request

About the Sponsor

Resource Royalty

Resource Royalty is a Dallas sponsor of oil-and-gas mineral and royalty DSTs, founded in 2011, occupying one of the more esoteric corners of the 1031 universe by offering direct-title, exchange-eligible mineral rights. Having raised roughly $173 million across 24 offerings covering some 440,000 gross acres and 1,650 producing wells, primarily in the Permian and Anadarko basins, the firm leans on conservative price-deck modeling to underwrite commodity exposure. The asset class diversifies away from real property cash flows but introduces energy-price and depletion risk that demands specialized diligence.