Viper Energy, Inc.VNOM
Viper Energy, Inc. Debt Disclosure
DEBT
Long-term debt consisted of the following as of the dates indicated:
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In millions) | |||||||||||
5.375% Senior Notes due 2027 | $ | — | $ | 430 | |||||||
4.900% Senior Notes due 2030 | 500 | — | |||||||||
7.375% Senior Notes due 2031 | — | 400 | |||||||||
5.700% Senior Notes due 2035 | 1,100 | — | |||||||||
| Term Loan | 500 | — | |||||||||
| Revolving credit facility | 105 | 261 | |||||||||
| Unamortized debt issuance costs | (15) | (6) | |||||||||
| Unamortized discount costs | (4) | (2) | |||||||||
| Total long-term debt | $ | 2,186 | $ | 1,083 | |||||||
2025 Revolving Credit Facility
On June 12, 2025, Former Viper, as guarantor, entered into a credit agreement with the Operating Company, as borrower, and Wells Fargo, as the administrative agent (the “2025 Revolving Credit Facility”), which among other things, provides the borrower with a senior unsecured revolving credit facility with a commitment of $1.5 billion, a swingline commitment of up to $50 million and a letter of credit commitment of $5 million. The 2025 Revolving Credit Facility has a maturity date of June 12, 2030, with the ability to request three extensions of the maturity date by one year. The 2025 Revolving Credit Facility was previously guaranteed by certain subsidiaries of the borrower, and upon completion of the Sitio Acquisition, those subsidiary guarantees were released and New Viper and Former Viper became co-guarantors. The 2025 Revolving Credit Facility replaced the borrower’s previous revolving credit facility, dated July 20, 2018, among the Company, the borrower and Wells Fargo as amended, restated, amended and restated, supplemented or otherwise modified prior to June 12, 2025. As of December 31, 2025, there was $105 million in outstanding borrowings and $1.4 billion available for future borrowings under the 2025 Revolving Credit Facility. For the years ended December 31, 2025, 2024 and 2023, the weighted average interest rates on borrowings under the borrower’s respective revolving credit facilities were 6.02%, 7.34%, and 7.41%, respectively.
Borrowings under the 2025 Revolving Credit Facility bear interest at a per annum rate elected by the borrower that is equal to term SOFR or an alternate base rate (which is equal to the greatest of the prime rate, the federal funds effective rate plus 0.50% and 1-month term SOFR plus 1.0%, subject to a 1.0% floor), in each case plus the applicable margin. The applicable margin ranges from 0.125% to 1.000% per annum in the case of the alternate base rate loans and from 1.125% to 2.000% per annum in the case of term SOFR loans, in each case based on the pricing level. Further, the commitment fee ranges from 0.125% to 0.325% per annum on the average daily unused portion of the commitment, again based on the pricing level. The pricing level depends on the rating of the Company’s long-term senior unsecured debt by certain ratings agencies.
The 2025 Revolving Credit Facility contains a financial covenant that requires the Company to maintain a Total Net Debt to Capitalization Ratio (as defined in the 2025 Revolving Credit Facility) of no more than 65%. As of December 31, 2025, the borrower was in compliance with all financial maintenance covenants under the 2025 Revolving Credit Facility.
On December 23, 2025, Old OpCo converted its legal form (the “OpCo Conversion”), in accordance with the applicable laws of the State of Delaware, to a Delaware limited partnership named Viper Energy Partners LP (“Viper LP”), which thereupon became the borrower with respect to the 2025 Revolving Credit Facility.
Term Loan
On July 23, 2025, in connection with the Sitio Acquisition, Former Viper, as guarantor, entered into a term loan credit agreement with the Operating Company, as borrower, and Goldman Sachs Bank USA, as administrative agent, (the “Term Loan”).
The Term Loan provided the Company with the ability to borrow up to $500 million on a senior unsecured basis to fund a portion of the retirement of Sitio’s net debt, in connection with the Sitio Acquisition. On August 19, 2025, the date of closing of the Sitio Acquisition, the Term Loan was fully drawn in a single borrowing. Any then-outstanding amounts will mature and be payable in full on the second anniversary of the initial funding date. In connection with the closing of the Sitio Acquisition, New Viper became a co-guarantor of the Term Loan. During the year ended December 31, 2025, the weighted average interest rate on borrowings under the Term Loan was 5.72%.
Borrowings under the Term Loan bear interest at a per annum rate elected by the borrower that is equal to SOFR or an alternate base rate (which is equal to the greatest of the prime rate, the federal funds effective rate plus 0.50% and 1-month term SOFR plus 1.0%, subject to a 1.0% floor), in each case plus the applicable margin. The applicable margin ranges from 0.250% to 1.125% per annum in the case of the alternate base rate loans and from 1.250% to 2.125% per annum in the case of term SOFR loans, in each case based on the pricing level. The pricing level depends on the rating of the Company’s long-term senior unsecured debt by certain ratings agencies. In addition, the fee on undrawn commitments is equal to 0.20% per annum on the aggregate principal amount of such commitments.
Following the OpCo Conversion, Viper LP became the borrower under the Term Loan.
Guaranteed Senior Notes Offering
On July 23, 2025, the Operating Company, as issuer, and Former Viper, as guarantor, issued $1.6 billion in aggregate principal amount of the Guaranteed Senior Notes consisting of (i) $500 million aggregate principal amount of 4.900% Senior Notes due August 1, 2030, (the “2030 Notes”), and (ii) $1.1 billion aggregate principal amount of 5.700% Senior Notes due August 1, 2035, (the “2035 Notes”). The Company received net proceeds of approximately $1.58 billion, after underwriters’ discounts and transaction costs. Interest on the Guaranteed Senior Notes is payable semi-annually in February and August of each year, beginning on February 1, 2026. Concurrently, the Company used approximately $824 million of the proceeds to redeem approximately $780 million in aggregate principal amounts of the Company’s outstanding Notes, including accrued interest due and applicable redemption premiums. Following the closing of the Sitio Acquisition, the Company used the remaining proceeds from the issuance of the Guaranteed Senior Notes to (i) retire Sitio’s 7.875% senior notes due 2028, (ii) partially repay borrowings under Sitio’s revolving credit facility, (iii) pay fees, costs and expenses related to the redemption or repayment of such debt, and (iv) for general corporate purposes.
The Guaranteed Senior Notes (i) are senior unsecured obligations and are fully and unconditionally guaranteed by Former Viper, and, following the closing of the Sitio Acquisition, also by New Viper, (ii) are senior in right of payment to any of the Company’s future subordinated indebtedness, and (iii) rank equal in right of payment with all of the Company’s existing and future senior indebtedness. The Guaranteed Senior Notes have been registered under the Securities Act.
Following the OpCo Conversion, Viper LP became the issuer with respect to the Guaranteed Senior Notes.
Retirement of Notes
During the second quarter of 2025, the Company opportunistically repurchased principal amounts of $50 million of its 5.375% Senior Notes due 2027 (the “2027 Notes”) in open market transactions for total cash consideration of $50 million, at an average of 99.7% of par value, resulting in an immaterial gain on extinguishment of debt for the year ended December 31, 2025.
On July 23, 2025, using proceeds from the issuance of the Guaranteed Senior Notes, the Company (i) redeemed all of its outstanding 7.375% Senior Notes maturing on November 1, 2031 (the “2031 Notes”), which were issued in October 2023 to partially fund the cash portion of the GRP Acquisition, for total cash consideration of approximately $434 million including the applicable redemption premium of 106.767% of par and accrued and unpaid interest up to, but not including, the redemption date, and (ii) deposited approximately $390 million to redeem all of its outstanding 2027 Notes on November 1, 2025, for total cash consideration, including payment of interest due to, but not including, the redemption date at a redemption price equal to 100% of the principal amount of the 2027 Notes. The redemption of the 2031 Notes resulted in a loss on extinguishment of debt of $32 million.
Interest Expense
The following amounts have been incurred and charged to interest expense for the years ended December 31, 2025, 2024 and 2023:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (In millions) | |||||||||||||||||
| Interest expense | $ | 103 | $ | 74 | $ | 48 | |||||||||||
| Other fees and expenses | 3 | 2 | 1 | ||||||||||||||
| Less: interest income | 10 | 2 | 2 | ||||||||||||||
| Interest expense, net | $ | 96 | $ | 74 | $ | 47 | |||||||||||
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.