DORCHESTER MINERALS, L.P. 10-K

ITEM 9A. CONTROLS AND PROCEDURES   Evaluation of Disclosure Controls and Procedures   Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2021. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, 2021, our disclosure controls and procedures were effective, in that they ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.   Management ’ s Annual Report on Internal Control Over Financial Reporting   Management acknowledges its responsibility for establishing and maintaining adequate internal control over financial reporting in accordance with Rule 13a-15(f) promulgated under the Securities Exchange Act of 1934. Management has also evaluated the effectiveness of its internal control over financial reporting in accordance with generally accepted accounting principles within the guidelines of the Committee of Sponsoring Organizations of the Treadway Commission framework (2013). Based on the results of this evaluation, management has determined that the Partnership’s internal control over financial reporting was effective as of December 31, 2021.   Changes in Internal Controls   There were no changes in our Partnership’s internal control over financial reporting (as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934) during the quarter ended December 31, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.   ITEM 9B. OTHER INFORMATION   None.   ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS   Not applicable.   28 Table of Contents   PART III   ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE   The information required by this item is incorporated herein by reference to the 2022 Proxy Statement, which will be filed with the Securities and Exchange Commission not later than 120 days subsequent to December 31, 2021.   ITEM 11. EXECUTIVE COMPENSATION   The information required by this item is incorporated herein by reference to the 2022 Proxy Statement, which will be filed with the Securities and Exchange Commission not later than 120 days subsequent to December 31, 2021.   ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED UNITHOLDER MATTERS   The information required by this item is incorporated herein by reference to the 2022 Proxy Statement, which will be filed with the Securities and Exchange Commission not later than 120 days subsequent to December 31, 2021.   ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE   The information required by this item is incorporated herein by reference to the 2022 Proxy Statement, which will be filed with the Securities and Exchange Commission not later than 120 days subsequent to December 31, 2021.   ITEM 14. PRINCIPAL ACCOUNTANT   FEES AND SERVICES   The information required by this item is incorporated herein by reference to the 2022 Proxy Statement, which will be filed with the Securities and Exchange Commission not later than 120 days subsequent to December 31, 2021.   29 Table of Contents   PART IV   ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES     (a) Financial Statements and Schedules     (1) See the Index to Consolidated Financial Statements on page F-1.   (2) No schedules are required.   (3) The exhibits required by Item 601 of Regulation S-K are as follows:   Number Description 3.1 Certificate of Limited Partnership of Dorchester Minerals, L.P. ( incorporated by reference to Exhibit 3.1 to Dorchester Minerals’  Registration Statement on Form S-4, Registration Number 333-88282 ) 3.2 Amended and Restated Agreement of Limited Partnership of Dorchester Minerals, L.P. ( incorporated by reference to Exhibit 3.2 to Dorchester Minerals’ Report on Form 10-K filed for the year ended December 31, 2002 ) 3.3 Amendment No. 1 to Amended and Restated Partnership Agreement of Dorchester Minerals, L.P. ( incorporated by reference to Exhibit 3.1 to Dorchester Minerals’  Current Report on Form 8-K filed with the SEC on December 22, 2017 ) 3.4 Amendment No. 2 to Amended and Restated Partnership Agreement of Dorchester Minerals, L.P. ( incorporated by reference to Exhibit 3.4 to Dorchester Minerals’  Report on Form 10-Q filed with the SEC on August 6, 2018 ) 3.5 Certificate of Limited Partnership of Dorchester Minerals Management LP ( incorporated by reference to Exhibit 3.4 to Dorchester Minerals ’   Registration Statement on Form S-4, Registration Number 333-88282 ) 3.6 Amended and Restated Agreement of Limited Partnership of Dorchester Minerals Management LP ( incorporated by reference to Exhibit 3.4 to Dorchester Minerals ’   Report on Form 10-K for the year ended December 31, 2002 ) 3.7 Certificate of Formation of Dorchester Minerals Management GP LLC ( incorporated by reference to Exhibit 3.7 to Dorchester Minerals ’   Registration Statement on Form S-4, Registration Number 333-88282 ) 3.8 Amended and Restated Limited Liability Company Agreement of Dorchester Minerals Management GP LLC ( incorporated by reference to Exhibit 3.6 to Dorchester Minerals ’   Report on Form 10-K for the year ended December 31, 2002 ) 3.9 Certificate of Formation of Dorchester Minerals Operating GP LLC ( incorporated by reference to Exhibit 3.10 to Dorchester Minerals ’   Registration Statement on Form S-4, Registration Number 333-88282 ) 3.10 Limited Liability Company Agreement of Dorchester Minerals Operating GP LLC ( incorporated by reference to Exhibit 3.11 to Dorchester Minerals ’   Registration Statement on Form S-4, Registration Number 333-88282 ) 3.11 Certificate of Limited Partnership of Dorchester Minerals Operating LP ( incorporated by reference to Exhibit 3.12 to Dorchester Minerals ’   Registration Statement on Form S-4, Registration Number 333-88282 ) 3.12 Amended and Restated Agreement of Limited Partnership of Dorchester Minerals Operating LP ( incorporated by reference to Exhibit 3.10 to Dorchester Minerals ’   Report on Form 10-K for the year ended December 31, 2002 ) 3.13 Certificate of Limited Partnership of Dorchester Minerals Oklahoma LP ( incorporated by reference to Exhibit 3.11 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 3.14 Agreement of Limited Partnership of Dorchester Minerals Oklahoma LP ( incorporated by reference to Exhibit 3.12 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 3.15 Certificate of Incorporation of Dorchester Minerals Oklahoma GP, Inc. ( incorporated by reference to Exhibit 3.13 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 3.16 Bylaws of Dorchester Minerals Oklahoma GP, Inc. ( incorporated by reference to Exhibit 3.14 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 4.1 Description of the Registrant’s Securities ( incorporated by reference to Exhibit 4.1 to Dorchester Minerals ’  Annual Report on Form 10-K for the year ended December 31, 2019 ) 10.1 Amended and Restated Business Opportunities Agreement dated as of December 13, 2001 by and between the Registrant, the General Partner, Dorchester Minerals Management GP LLC, SAM Partners, Ltd., Vaughn Petroleum, Ltd., Smith Allen Oil & Gas, Inc., P.A. Peak, Inc., James E. Raley, Inc., and certain other parties ( incorporated by reference to Exhibit 10.1 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 10.2 Transfer Restriction Agreement ( incorporated by reference to Exhibit 10.2 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 10.3 Registration Rights Agreement ( incorporated by reference to Exhibit 10.3 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 10.4 Lock-Up Agreement by William Casey McManemin ( incorporated by reference to Exhibit 10.4 to Dorchester Minerals ’   Annual Report on Form 10-K for the year ended December 31, 2002 ) 10.5 Form of Indemnity Agreement ( incorporated by reference to Exhibit 10.1 to Dorchester Minerals ’   Quarterly Report on Form 10-Q for the quarter ended June 30, 2004 )   30 Table of Contents   Number Description 10.6 Dorchester Minerals Operating LP Equity Incentive Program ( incorporated by reference to Annex A to Dorchester Minerals ’   Proxy Statement on Schedule 14A filed with the SEC on March 16, 2015 ) 10.7 Contribution and Exchange Agreement dated November 22, 2021, by and between Dorchester Minerals, L.P. and Gemini 5 Thirty, LP ( incorporated by reference to Exhibit 2.1 to Dorchester Minerals' Current Report on Form 8-K filed with the SEC on November 23, 2021 ) 21.1* Subsidiaries of the Registrant 23.1* Consent of Grant Thornton LLP 23.2* Consent of LaRoche Petroleum Consultants, Ltd. 31.1* Certification of Chief Executive Officer of our Partnership pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 31.2* Certification of Chief Financial Officer of our Partnership pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 32.1** Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Sec. 1350 99.1* Report of LaRoche Petroleum Consultants, Ltd. 99.2* Report of LaRoche Petroleum Consultants, Ltd. 101.INS* XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)   * Filed herewith ** Furnished herewith   ITEM 16. FORM 10-K SUMMARY   None.   31 Table of Contents   GLOSSARY OF CERTAIN OIL AND NATURAL GAS TERMS   The definitions set forth below shall apply to the indicated terms as used in this document. All volumes of natural gas referred to herein are stated at the legal pressure base of the state or area where the reserves exist and at 60 degrees Fahrenheit and in most instances are rounded to the nearest major multiple.   "bbl" means a standard barrel of 42 U.S. gallons and represents the basic unit for measuring the production of crude oil, natural gas liquids and condensate.   “boe ” means one barrel of oil equivalent, converting natural gas to oil at the ratio of 6 Mcf of natural gas to 1 Bbl of oil. Also see mcfe below.   "Depletion" means (a) the volume of hydrocarbons extracted from a formation over a given period of time, (b) the rate of hydrocarbon extraction over a given period of time expressed as a percentage of the reserves existing at the beginning of such period, or (c) the amount of cost basis at the beginning of a period attributable to the volume of hydrocarbons extracted during such period.   "Division order" means a document to protect lessees and purchasers of production, in which all parties who may have a claim to the proceeds of the sale of production agree upon how the proceeds are to be divided.   "Enhanced recovery" means the process or combination of processes applied to a formation to extract hydrocarbons in addition to those that would be produced utilizing the natural energy existing in that formation. Examples of enhanced recovery include water flooding and carbon dioxide (CO2) injection.   "Estimated future net revenues" (also referred to as "estimated future net cash flow") means the result of applying current prices of oil and natural gas to estimated future production from oil and natural gas proved reserves, reduced by estimated future expenditures, based on current costs to be incurred in developing and producing the proved reserves, excluding overhead.   "Formation" means a distinct geologic interval, sometimes referred to as the strata, which has characteristics (such as permeability, porosity and hydrocarbon saturations) that distinguish it from surrounding intervals.   "Gross acre" means the number of surface acres in which a working interest is owned.   "Gross well" means a well in which a working interest is owned.   "Lease bonus" means the initial cash payment made to a lessor by a lessee in consideration for the execution and conveyance of the lease and includes proceeds from assignments of leasehold interests where the Partnership retains an interest.   "Leasehold" means an acre in which a working interest is owned.   "Lessee" means the owner of a lease of a mineral interest in a tract of land.   "Lessor" means the owner of the mineral interest who grants a lease of his interest in a tract of land to a third party, referred to as the lessee.   "Mineral interest" means the interest in the minerals beneath the surface of a tract of land. A mineral interest may be severed from the ownership of the surface of the tract. Ownership of a mineral interest generally involves four incidents of ownership: (1) the right to use the surface; (2) the right to incur costs and retain profits, also called the right to develop; (3) the right to transfer all or a portion of the mineral interest; and (4) the right to retain lease benefits, including bonuses and delay rentals.   "mcf ” means one thousand cubic feet under prescribed conditions of pressure and temperature and represents the basic unit for measuring the production of natural gas.   “mcfe ” means one thousand cubic feet of natural gas equivalent, converting oil or condensate to natural gas at the ratio of 1 Bbl of oil or condensate to 6 Mcf of natural gas. This conversion ratio, which is typically used in the oil and gas industry, represents the approximate energy equivalent of a barrel of oil or condensate to an Mcf of natural gas. The sales price of one barrel of oil or condensate has been much higher than the sales price of six Mcf of natural gas over the last several years, so a six to one conversion ratio does not represent the economic equivalency of six Mcf of natural gas to one barrel of oil or condensate   "mbbls" means one thousand standard barrels of 42 U.S. gallons and represents the basic unit for measuring the production of crude oil, natural gas liquids and condensate.   "mmcf ” means one million cubic feet under prescribed conditions of pressure and temperature and represents the basic unit for measuring the production of natural gas.   "Net acre" means the product determined by multiplying gross acres by the interest in such acres.   "Net well" means the product determined by multiplying gross oil and natural gas wells by the interest in such wells.   "Net profits interest" means a non-operating interest that creates a share in gross production from another (operating or non-operating) interest in oil and natural gas properties. The share is determined by net profits from the sale of production and customarily provides for the deduction of capital and operating costs from the proceeds of the sale of production. The owner of a net profits interest is customarily liable for the payment of capital and operating costs only to the extent that revenue is sufficient to pay such costs but not otherwise.   32 Table of Contents   "Operator" means the individual or company responsible for the exploration, development, and production of an oil or natural gas well or lease.   "Overriding royalty interest" means a royalty interest created or reserved from another (operating or non-operating) interest in oil and natural gas properties. Its term extends for the same term as the interest from which it is created.   “Payout ” or “ Back-in ” occurs when the working interest owners who participate in the costs of drilling and completing a well recoup the costs and expenses, or a multiple of the costs and expenses, of drilling and completing that well. Only then are the owners who chose not to contribute to these initial costs entitled to participate with the other owners in production and share in the expenses and revenues associated with the well. The reversionary interest or back-in interest of an owner similarly occurs when the owner becomes entitled to a specified share of the working or overriding royalty interest when specified costs have been recovered from production.   “Pooling election ” means the statutory combination of interests which affords owners the right to choose between participating in the drilling of a well or accepting royalty payments.   "Proved developed reserves" means reserves that can be expected to be recovered (i) through existing wells with existing equipment and operating methods or in which the cost of the required equipment is relatively minor compared to the cost of a new well; and (ii) through installed extraction equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a well.   "Proved reserves" or “ Proved oil and natural gas reserves ” means those quantities of oil and natural gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and governmental regulations—prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. The project to extract the hydrocarbons must have commenced or the operator must be reasonably certain that it will commence the project within a reasonable time.   "Royalty" means an interest in an oil and natural gas lease that gives the owner of the interest the right to receive a portion of the production from the leased acreage (or of the proceeds of the sale thereof) but generally does not require the owner to pay any portion of the costs of drilling or operating the wells on the leased acreage.   "Severance tax" means an amount of tax, surcharge or levy recovered by governmental agencies from the gross proceeds of oil and natural gas sales. Severance tax may be determined as a percentage of proceeds or as a specific amount per volumetric unit of sales. Severance tax is usually withheld from the gross proceeds of oil and natural gas sales by the first purchaser (e.g., pipeline or refinery) of production.   "Standardized measure of discounted future net cash flows" (also referred to as "standardized measure") means the pretax present value of estimated future net revenues to be generated from the production of proved reserves calculated in accordance with SEC guidelines, net of estimated production and future development costs, using prices and costs as of the date of estimation without future escalation, without giving effect to non-property related expenses such as general and administrative expenses, debt service and depreciation, depletion and amortization, and discounted using an annual discount rate of 10%.   “Suspense release ” means revenues that have been held by a purchaser or lessee, often attributable to multiple months of production.   "Undeveloped acreage" means lease acreage on which wells have not been drilled or completed to a point that would permit the production of commercial quantities of oil and natural gas regardless of whether such acreage contains proved reserves.   "Unitization" means the process of combining mineral interests or leases thereof in separate tracts of land into a single entity for administrative, operating or ownership purposes. Unitization is sometimes called "pooling" or "communitization" and may be voluntary or involuntary.   "Working interest" (also referred to as an "operating interest") means a real property interest entitling the owner to receive a specified percentage of the proceeds of the sale of oil and natural gas production or a percentage of the production but requiring the owner of the working interest to bear the cost to explore for, develop and produce such oil and natural gas. A working interest owner who owns a portion of the working interest may participate either as operator or by voting his percentage interest to approve or disapprove the appointment of an operator and certain activities in connection with the development and operation of a property.   33 Table of Contents   SIGNATURES   Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.     DORCHESTER MINERALS, L.P.             By: Dorchester Minerals Management LP,       its General Partner             By: Dorchester Minerals Management GP LLC,       its General Partner             By: /s/ William Casey McManemin       William Casey McManemin       Chief Executive Officer     Date: February 24, 2022   Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.   /s/ William Casey McManemin   /s/ H.C. Allen, Jr. William Casey McManemin Chief Executive Officer and Manager (Principal Executive Officer) Date: February 24, 2022   H.C. Allen, Jr. Manager Date: February 24, 2022       /s/ James E. Raley   /s/ Allen D. Lassiter James E. Raley Vice Chairman and Manager Date: February 24, 2022   Allen D. Lassiter Manager Date: February 24, 2022       /s/ Martha Ann Peak Rochelle   /s/ C. W. Russell Martha Ann Peak Rochelle Manager Date: February 24, 2022   C. W. Russell Manager Date: February 24, 2022       /s/ Ronald P. Trout   /s/ Robert C. Vaughn Ronald P. Trout Manager Date: February 24, 2022   Robert C. Vaughn Manager Date: February 24, 2022   34 Table of Contents       DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS   Dorchester Minerals, L.P.   Report of Independent Registered Public Accounting Firm (PCAOB ID Number 248 ) F-2     Consolidated Balance Sheets as of December 31, 2021 and 2020 F-3     Consolidated Income Statements for each of the Years Ended December 31, 2021 and 2020 F-4     Consolidated Statements of Changes in Partnership Capital for each of the Years Ended December 31, 2021 and 2020 F-5     Consolidated Statements of Cash Flows for each of the Years Ended December 31, 2021 and 2020 F-6     Notes to Consolidated Financial Statements F-7     Supplemental Oil and Natural Gas Data (Unaudited) F-12   F-1 Table of Contents   REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM   General Partner and Unitholders Dorchester Minerals, L.P.   Opinion on the financial statements We have audited the accompanying consolidated balance sheets of Dorchester Minerals, L.P. (a Delaware limited partnership) and subsidiaries (the “Partnership”) as of December 31, 2021 and 2020, the related consolidated statements of income, changes in partnership capital, and cash flows for each of the two years in the period ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Partnership as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.   Basis for opinion These financial statements are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on the Partnership’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.   We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Partnership is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Partnership's internal control over financial reporting. Accordingly, we express no such opinion.   Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.   Critical audit matters Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that; (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgements. We determined that there are no critical audit matters.   /s/ GRANT THORNTON LLP   We have served as the Partnership’s auditor since 1998.   Dallas, Texas February 24, 2022   F-2 Table of Contents     DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   CONSOLIDATED BALANCE SHEETS December 31, (In Thousands)       2021     2020   ASSETS                 Current assets:                 Cash and cash equivalents   $ 28,306     $ 11,232   Trade and other receivables     11,533       5,075   Net profits interest receivable — related party     6,822       1,914   Total current assets     46,661       18,221                     Oil and natural gas properties (full cost method)     440,052       399,324   Accumulated full cost depletion     ( 341,733 )     ( 331,361 ) Total     98,319       67,963                     Leasehold improvements     989       989   Accumulated amortization     ( 330 )     ( 238 ) Total     659       751                     Operating lease right-of-use asset     1,168       1,392   Total assets   $ 146,807     $ 88,327                     LIABILITIES AND PARTNERSHIP CAPITAL                 Current liabilities:                 Accounts payable and other current liabilities   $ 2,512     $ 1,578   Operating lease liability     291       300   Total current liabilities     2,803       1,878                     Operating lease liability     1,594       1,885   Total liabilities     4,397       3,763                     Commitments and contingencies (Note 5)                     Partnership capital:                 General Partner     982       536   Unitholders     141,428       84,028   Total partnership capital     142,410       84,564   Total liabilities and partnership capital   $ 146,807     $ 88,327     The accompanying notes are an integral part of these consolidated financial statements   F-3 Table of Contents     DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   CONSOLIDATED INCOME STATEMENTS For each of the Years Ended December 31, (In Thousands, except per unit amounts)       2021     2020   Operating revenues:                 Royalties   $ 73,985     $ 37,043   Net profits interests     17,596       8,714   Lease bonus     829       291   Other     1,013       880   Total operating revenues     93,423       46,928                     Costs and expenses                 Production taxes     3,667       1,813   Operating expenses     3,929       3,880   Depreciation, depletion and amortization     10,464       11,909   General and administrative expenses     5,189       7,459   Total costs and expenses     23,249       25,061   Net income   $ 70,174     $ 21,867                     Allocation of net income:                 General Partner   $ 2,348     $ 705   Unitholders   $ 67,826     $ 21,162   Net income per common unit (basic and diluted)   $ 1.94     $ 0.61   Weighted average basic and diluted common units outstanding     35,052       34,680     The accompanying notes are an integral part of these consolidated financial statements   F-4 Table of Contents     DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERSHIP CAPITAL For each of the Years Ended December 31, (In Thousands)       General Partner     Unitholders     Total     Unitholder Units   2020                                 Balance at January 1, 2020   $ 1,228     $ 111,108     $ 112,336       34,680   Net income     705       21,162       21,867       -   Distributions ($ 1.391063 per Unit)     ( 1,397 )     ( 48,242 )     ( 49,639 )     -   Balance at December 31, 2020   $ 536     $ 84,028     $ 84,564       34,680   2021                                 Net income     2,348       67,826       70,174       -   Acquisition of assets for units     -       43,484       43,484       2,305   Distributions ($ 1.533837 per Unit)     ( 1,902 )     ( 53,910 )     ( 55,812 )     -   Balance at December 31, 2021   $ 982     $ 141,428     $ 142,410       36,985     The accompanying notes are an integral part of these consolidated financial statements   F-5 Table of Contents     DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   CONSOLIDATED STATEMENTS OF CASH FLOWS For each of the Years Ended December 31, (In Thousands)       2021     2020   Cash flows from operating activities:                 Net income   $ 70,174     $ 21,867   Adjustments to reconcile net income to net cash provided by operating activities:                 Depreciation, depletion and amortization     10,464       11,909   Amortization of operating lease right-of-use asset     224       240   Changes in operating assets and liabilities:                 Trade and other receivables     ( 5,972 )     2,206   Net profits interests receivable — related party     ( 4,908 )     3,968   Accounts payable and other current liabilities     623       ( 474 ) Operating lease liability     ( 300 )     ( 310 ) Net cash provided by operating activities     70,305       39,406                     Cash flows provided by investing activities:                 Net cash contributed in acquisitions     2,319       -   Proceeds from the sale of oil and natural gas properties     262       6,126   Total cash flows provided by investing activities     2,581       6,126                     Cash flows used in financing activities:                 Distributions paid to General Partner and unitholders     ( 55,812 )     ( 49,639 ) Increase (decrease) in cash and cash equivalents     17,074       ( 4,107 ) Cash and cash equivalents at beginning of year     11,232       15,339   Cash and cash equivalents at end of year   $ 28,306     $ 11,232                     Non-cash investing activities:                 Fair value of common units issued for acquisitions   $ 43,484     $ -     The accompanying notes are an integral part of these consolidated financial statements   F-6 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Notes to Consolidated Financial Statements       1. General and Summary of Significant Accounting Policies   Nature of Operations — In these Notes, the term “Partnership,” as well as the terms “us,” “our,” “we,” and “its” are sometimes used as abbreviated references to Dorchester Minerals, L.P. itself or Dorchester Minerals, L.P. and its related entities. Our Partnership is a Dallas, Texas based owner of producing and nonproducing natural gas and crude oil royalty, net profits, and leasehold interests in 582 counties and 26 states. We are a publicly traded Delaware limited partnership that was formed in December 2001 and commenced operations on January 31, 2003.   Basis of Presentation — The consolidated financial statements herein have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).   Basic and Diluted Earnings Per Unit — Per-unit information is calculated by dividing the net income applicable to holders of our Partnership’s common units by the weighted average number of units outstanding. The Partnership has no potentially dilutive securities and, accordingly, basic and dilutive net income per unit do not differ.   Principles of Consolidation — The consolidated financial statements include the accounts of Dorchester Minerals, L.P., Dorchester Minerals Oklahoma, LP, Dorchester Minerals Oklahoma GP, Inc., Maecenas Minerals LLP, Dorchester-Maecenas GP LLC, The Buffalo Co., A Limited Partnership, and DMLPTBC GP LLC. All intercompany balances and transactions have been eliminated in consolidation.   Use of Estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.    General Partner —Our general partner is Dorchester Minerals Management LP, referred to in these Notes as “our General Partner.” Our General Partner owns all of the partnership interests in Dorchester Minerals Operating LP, the Operating Partnership. See Note 4  —Related Party Transactions. The General Partner is allocated 4 % and 1 % of our Royalty Properties’ net revenues and Net Profits Interest ("NPI") proceeds received by the Operating Partnership, respectively. The Royalty Properties consist of producing and nonproducing mineral, royalty, overriding royalty, net profits, and leasehold interests located in 582 counties and parishes in 26 states (“Royalty Properties”).   Cash and Cash Equivalents —Our principal banking relationships are with major financial institutions. Cash balances in these accounts may, at times, exceed federally insured limits. We have not experienced any losses in such cash accounts and do not believe we are exposed to any significant risk on cash and cash equivalents. Short term investments with an original maturity of three months or less are considered to be cash equivalents and are carried at cost, which approximates fair value.   Concentration of Credit Risks and Significant Customers —Our Partnership, as a royalty and NPI owner, has extremely limited involvement and no control over the volumes or method of sale of oil and natural gas produced and sold from the Royalty Properties and NPI. Royalty revenues from properties operated by Pioneer Natural Resources represented approximately 13 % of total operating revenues for the year ended December 31, 2021. There were no concentrations of revenue with a single customer for the year ended December 31, 2020. If we were to lose a significant customer, such loss could impact revenue. The loss of any single customer is mitigated by our diversified customer base, and we do not believe that the loss of any single customer would have a long-term material adverse effect on our financial position or the results of operations.   Fair Value of Financial Instruments —The carrying amount of cash and cash equivalents, trade and other receivables, and accounts payables and other current liabilities approximates fair value because of the short maturity of those instruments. These estimated fair values may not be representative of actual values of the financial instruments that could have been realized as of year-end or that will be realized in the future.   F- 7 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Notes to Consolidated Financial Statements     Receivables —Our Partnership’s trade and other receivables and net profits interests receivable consist primarily of Royalty Properties payments receivable and NPI payments receivable, respectively. Most payments are received two to four months after production date. No allowance for doubtful accounts is deemed necessary based upon our lack of historical write offs and review of current receivables.   Oil and Natural Gas Properties — We utilize the full cost method of accounting for costs related to our oil and natural gas properties. Under this method, all such costs are capitalized and amortized on an aggregate basis over the estimated lives of the properties using the unit-of-production method. These capitalized costs are subject to a ceiling test, which limits such pooled costs to the aggregate of the present value of future net revenues attributable to proved oil and natural gas reserves discounted at 10 % plus the lower of cost or market value of unproved properties. For the purposes of determining the capitalized costs ceiling, our Partnership only assigned value to proved developed producing oil and natural gas reserves as of December 31, 2021. The full cost ceiling is evaluated at the end of each quarter and when events indicate possible impairment. There have been no impairments for the years ended December 31, 2021 and 2020.   The discounted present value of our proved oil and natural gas reserves is a major component of the ceiling test calculation and requires many subjective judgments. Estimates of reserves are forecasts based on engineering and geological analyses. Different reserve engineers could reach different conclusions as to estimated quantities of oil and natural gas reserves based on the same information. The passage of time provides more qualitative and quantitative information regarding reserve estimates, and revisions are made to prior estimates based on updated information. However, there can be no assurance that more significant revisions will not be necessary in the future. Significant downward revisions could result in an impairment representing a non-cash charge to income. In addition to the impact on the calculation of the ceiling test, estimates of proved reserves are also a major component of the calculation of depletion.   While the quantities of proved reserves require substantial judgment, the associated prices of oil and natural gas reserves that are included in the discounted present value of our reserves are objectively determined. The ceiling test calculation requires use of the unweighted arithmetic average of the first day of the month price during the 12 -month period ending on the balance sheet date and costs in effect as of the last day of the accounting period, which are generally held constant for the life of the oil and natural gas properties. As a result, the present value is not necessarily an indication of the fair value of the reserves. Oil and natural gas prices have historically been volatile, and the prevailing prices at any given time may not reflect our Partnership’s or the industry’s forecast of future prices.   Gains and losses are recognized upon the disposition of oil and natural gas properties involving a significant portion (greater than 25 %) of our Partnership’s reserves. Proceeds from other dispositions of oil and natural gas properties are credited to the full cost pool.   Leasehold Improvements — Leasehold improvements are amortized over the shorter of their estimated useful lives or the related life of the lease.   Leases — The Partnership determines if an arrangement is a lease at inception. The Partnership leases its office space at 3838 Oak Lawn Avenue, Suite 300, Dallas, Texas, through an operating lease (the “Office Lease”). The operating lease is included in operating lease right-of-use (“ROU”) asset and operating lease liability in our consolidated balance sheets. Operating lease expense is included in general and administrative expenses in the consolidated income statements.   Operating lease ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. As the Partnership’s lease does not provide an implicit rate of return and as the Partnership is precluded from incurring any borrowings above a nominal amount under its partnership agreement, the Partnership used a discount rate commensurate with the incremental borrowing rate of a group of peers based on information available at the application date in determining the present value of lease payments. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.    Asset Retirement Obligations — Based on the nature of our property ownership, we have no material obligations to record.   Revenue Recognition — The pricing of oil and natural gas sales from the Royalty Properties and NPI is primarily determined by supply and demand in the marketplace and can fluctuate considerably. As a royalty owner, we have extremely limited involvement and no operational control over the volumes and method of sale of oil and natural gas produced and sold from the Royalty Properties and NPI.   Revenues from Royalty Properties and NPI are recorded under the cash receipts approach as directly received from the remitters’ statement accompanying the revenue check. Since the revenue checks are generally received two to four months after the production month, the Partnership accrues for revenue earned but not received by estimating production volumes and product prices. Identified differences between our accrued revenue estimates and actual revenue received historically have not been significant.   The Partnership does not record revenue for unsatisfied or partially unsatisfied performance obligations. The Partnership’s right to revenues from Royalty Properties and NPI occurs at the time of production, at which point, payment is unconditional, and no remaining performance obligation exists for the Partnership. Accordingly, the Partnership’s revenue contracts for Royalty Properties and NPI do not generate contract assets or liabilities.   F- 8 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Notes to Consolidated Financial Statements     Revenues from lease bonus payments are recorded upon receipt. The lease bonus is separate from the lease itself and is recognized as revenue to the Partnership upon receipt of payment. The Partnership generates lease bonus revenue by leasing its mineral interests to exploration and production companies and includes proceeds from assignments of leasehold interests where the Partnership retains an interest. A lease agreement represents the Partnership’s contract with a lessee and generally transfers the rights to develop oil or natural gas, grants the Partnership a right to a specified royalty interest, and requires that drilling and completion operations commence within a specified time period. Upon signing a lease agreement, no further performance obligation exists for the Partnership, and therefore, no contract assets or contract liabilities are generated.   Income Taxes — We are treated as a partnership for income tax purposes and, as a result, our income or loss is includable in the tax returns of the individual unitholders. Depletion of oil and natural gas properties is an expense allowable to each individual partner, and the depletion expense as reported on the consolidated financial statements will not be indicative of the depletion expense an individual partner or unitholder may be able to deduct for income tax purposes.   Texas imposes a franchise tax (commonly referred to as the Texas margin tax) at a rate of 0.75 % on gross revenues less certain deductions, as specifically set forth in the Texas margin tax statute. The Texas margin tax applies to corporations and limited liability companies, general and limited partnerships (unless otherwise exempt), limited liability partnerships, trusts (unless otherwise exempt), business trusts, business associations, professional associations, joint stock companies, holding companies, joint ventures, and certain other business entities having limited liability protection.   Limited partnerships that receive at least 90% of their gross income from designated passive sources, including royalties from mineral properties and other non-operated mineral interest income, and do not receive more than 10% of their income from operating an active trade or business, are generally exempt from the Texas margin tax as “passive entities.” We believe our Partnership meets the requirements for being considered a “passive entity” for Texas margin tax purposes and, therefore, it is exempt from the Texas margin tax. If the Partnership is exempt from Texas margin tax as a passive entity, each unitholder that is considered a taxable entity under the Texas margin tax would generally be required to include its portion of Partnership revenues in its own Texas margin tax computation. The Texas Administrative Code provides that such income is sourced according to the principal place of business of the Partnership, which would be the state of Texas.   Recent Events – In January 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus (“COVID- 19” ) and the significant risks to the international community and economies as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified COVID- 19 as a pandemic, based on the rapid increase in exposure globally, and thereafter, COVID- 19 continued to spread throughout the U.S. and worldwide. In addition, actions taken by OPEC members and other exporting nations on the supply and demand in global oil and natural gas markets resulted in significant negative pricing pressure in the first half of 2020, followed by a recovery in pricing and an increase in demand in the second half of 2020 and into 2021. However, multiple variants emerged in 2021 and became highly transmissible, which contributed to additional pricing volatility during 2021 to date. The financial results of companies in the oil and natural gas industry have been impacted materially as a result of changing market conditions. Such circumstances generally increase uncertainty in the Partnership’s accounting estimates. Although demand and market prices for oil and natural gas have recently increased, due to the rising energy use and the improvement in U.S. economic activity, we cannot predict events that may lead to future price volatility and the near term energy outlook remains subject to heightened levels of uncertainty.   We are continuing to closely monitor the overall impact and the evolution of the COVID- 19 pandemic, including the ongoing spread of any variants, along with future OPEC actions on all aspects of our business, including how these events may impact our future operations, financial results, liquidity, employees, and operators. Additional actions may be required in response to the COVID- 19 pandemic on a national, state, and local level by governmental authorities, and such actions may further adversely affect general and local economic conditions, particularly if the 2021 resurgence and spread of the COVID- 19 pandemic continues. We cannot predict the long-term impact of these events on our liquidity, financial position, results of operations or cash flows due to uncertainties including the severity of COVID- 19 or any of the ongoing variants, and the effect the virus will have on the demand for oil and natural gas. These situations remain fluid and unpredictable, and we are actively managing our response.   F- 9 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Notes to Consolidated Financial Statements       2. Acquisitions for Units   On December 31, 2021, pursuant to a non-taxable contribution and exchange agreement with Gemini 5 Thirty, LP, a Texas limited partnership (“Gemini”), the Partnership acquired mineral and royalty interests representing approximately 4,600 net royalty acres located in 27 counties across New Mexico, Oklahoma, Texas and Wyoming in exchange for 1,580,000 common units representing limited partnership interests in the Partnership valued at $ 31.3 million and issued pursuant to the Partnership's registration statement on Form S- 4. We believe that the acquisition is considered complimentary to our business. The transaction was accounted for as an acquisition of assets under U.S. GAAP. Accordingly, the cost of the acquisition was allocated on a relative fair value basis and transaction costs were capitalized as a component of the cost of the assets acquired. At closing, in addition to conveying mineral and royalty interests to the Partnership, Gemini delivered funds to the Partnership in an amount equal to their cash receipts during the period from October 1, 2021 through December 31, 2021 of $ 1.9 million. The contributed cash, net of capitalized transaction costs paid, of $ 1.6 million is included in net cash contributed in acquisitions on the consolidated statement of cash flows for the year ended December 31, 2021. The consolidated balance sheet as of December 31, 2021 includes $ 29.3 million of net proved oil and natural gas properties acquired in the transaction.   On June 30, 2021, pursuant to a non-taxable contribution and exchange agreement with JSFM, LLC, a Wyoming limited liability company (“JSFM”), the Partnership acquired overriding royalty interests in the Bakken Trend totaling approximately 6,400 net royalty acres located in Dunn, McKenzie, McLean and Mountrail Counties, North Dakota in exchange for 725,000 common units representing limited partnership interests in the Partnership valued at $ 12.2 million and issued pursuant to the Partnership's registration statement on Form S- 4. We believe that the acquisition is considered complimentary to our business. The transaction was accounted for as an acquisition of assets under U.S. GAAP. Accordingly, the cost of the acquisition was allocated on a relative fair value basis and transaction costs were capitalized as a component of the cost of the assets acquired. At closing, in addition to conveying overriding royalty interests to the Partnership, JSFM delivered funds to the Partnership in an amount equal to their cash receipts during the period from April 1, 2021 through June 30, 2021 of $ 0.4 million. The contributed cash and final settlement net cash receipts, net of capitalized transaction costs paid, of $ 0.7 million are included in the net cash contributed in acquisition on the consolidated statement of cash flows for the year ended December 31, 2021. The consolidated balance sheet as of December 31, 2021 includes $ 11.5 million of net proved oil and natural gas properties acquired in the transaction.       3. Net Profits Interest Divestiture   On September 30, 2020, the Partnership and affiliates of its General Partner closed the divestiture of our Hugoton net profits interest located in Texas County, Oklahoma and Stevens County, Kansas to a third party. In accordance with the full cost method of accounting, as the divestiture did not represent a significant portion of the Partnership’s reserves, gross divestiture proceeds of $ 5.7 million were credited to the oil and natural gas properties full cost pool as of December 31, 2020. Transaction costs of $ 0.5 million are included in general and administrative expenses on the consolidated income statement for the year ended December 31, 2020.       4. Related Party Transactions   Our General Partner owns all of the partnership interests in the Operating Partnership. It is the employer of all personnel, owns the working interests and other properties underlying our NPI, and provides day-to-day operational and administrative services to us and the General Partner. In accordance with our partnership agreement, we reimburse the General Partner for certain allocable general and administrative costs, including rent, salaries, and employee equity and benefit plans that are not direct expenses. These types of reimbursements are limited to 5 % of distributions, plus certain costs previously paid. All such costs have been below the annual 5 % limit amount, including the allowable surplus carryforward, for the years ended December  31, 2021 and 2020. Additionally, certain reimbursable direct expenses such as professional and regulatory fees, as well as certain general and administrative costs that are related to regulatory matters, are not limited. Significant activity between the Partnership and the Operating Partnership consists of the following:       In Thousands       2021     2020   Net profits interest receivable   $ 6,822     $ 1,914   Net profits interests revenue   $ 17,596     $ 8,714   General and administrative amounts payable   $ 85     $ 486   Total general and administrative expenses   $ 571     $ 2,905         5. Commitments and Contingencies   Our Partnership and the Operating Partnership are involved in legal and/or administrative proceedings arising in the ordinary course of their businesses, none of which have predictable outcomes and none of which are believed to have any significant effect on consolidated financial position, cash flows, or operating results.   F- 10 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Notes to Consolidated Financial Statements       6. Distribution To Holders of Common Units   During 2020 and during the first and second quarter of 2021, cash distributions were paid on 34,679,774 units. During the third and fourth quarter of 2021, cash distributions were paid on 35,404,774 units. Fourth quarter cash distributions are paid in February of the following calendar year to unitholders of record in January or February of such following year. The partnership agreement requires the next cash distribution to be paid by May 15, 2022.       7. Leases   The third amendment to our Office Lease was executed in April 2017 for a term of 129 months, beginning June 1, 2018 and expiring in 2029. At lease commencement, the Partnership concluded the Office Lease was an operating lease. Under the third amendment to the Office Lease, monthly rental payments range from $ 25,000 to $ 30,000 and the Partnership received lease incentives of $ 0.7 million.   Lease expense for the years ended December 31, 2021 and 2020 was as follows:       In Thousands       2021     2020   Operating lease expense   $ 262     $ 262     Supplemental cash flow information related to leases was as follows:       In Thousands       2021     2020   Cash paid for amounts included in the measurement of lease liabilities                 Operating cash flows from operating leases   $ 338     $ 332     Supplemental balance sheet information related to leases was as follows:       2021     2020   Weighted-Average Remaining Lease Term (months)                 Operating lease     86       98   Weighted-Average Discount Rate                 Operating lease     5 %     5 %   Maturities of lease liabilities are as follows:       In Thousands       2021   2022   $ 344   2023     350   2024     356   2025     362   2026     368   Thereafter     817   Total lease payments     2,597   Less amount representing interest     ( 712 ) Total lease obligation   $ 1,885     F-11 Table of Contents     DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Supplemental Oil and Natural Gas Data (Unaudited)   Oil and Natural Gas Reserve and Standardized Measure   The NPI represents a net profit overriding royalty interest in various properties owned by the Operating Partnership. The Royalty Properties consist of producing and nonproducing mineral, royalty, overriding royalty, net profits, and leasehold interests located in 582 counties and parishes in 26 states. Amounts set forth herein attributable to the NPI reflects our 96.97% net share. Although new activity has occurred on certain of the Royalty Properties, based on engineering studies available to date, no events have occurred since December 31, 2021 that would have a material effect on our estimated proved developed reserves.   In accordance with U.S. GAAP and Securities and Exchange Commission rules and regulations, the following information is presented with regard to the Royalty Properties and NPI oil and natural gas reserves, all of which are proved, developed, and located in the United States. These rules require inclusion as a supplement to the basic financial statements a standardized measure of discounted future net cash flows relating to proved oil and natural gas reserves. The standardized measure, in management's opinion, should be examined with caution. The basis for these disclosures are petroleum engineers’ reserve studies which contain estimates of quantities and rates of production of reserves. Revision of prior year estimates can have a significant impact on the results. Changes in production costs may result in significant revisions to previous estimates of proved reserves and their future value. Therefore, the standardized measure is not necessarily a best estimate of the fair value of oil and natural gas properties or of future net cash flows.   The following summaries of changes in reserves and standardized measure of discounted future net cash flows were prepared from estimates of proved reserves. The Standardized Measure of Discounted Future Net Cash Flows reflects adjustments for fuel, shrinkage, and pipeline loss.       Oil (mbbls)     Natural Gas (mmcf)       2021     2020     2019     2021     2020     2019   Estimated quantity, beginning of year     9,344       9,638       9,041       33,779       45,860       44,230   Revisions in previous estimates (1)     547       1,368       1,394       7,991       (1,853 )     6,466   Purchase of minerals in place (2)     630       -       788       1,093       -       1,933   Sales of minerals in place (3)     -       (203 )     -       -       (4,447 )     -   Production     (1,346 )     (1,459 )     (1,585 )     (4,964 )     (5,781 )     (6,769 ) Estimated quantity, end of year     9,175       9,344       9,638       37,899       33,779       45,860     (1) Changes in oil reserves for the years ended December 31, 2021, 2020, and 2019 include upward revisions of 547 mbbls, 1,368, mbbls and 1,394 mbbls, respectively, predominately due to ongoing development on our Permian Basin and Bakken properties and well performance exceeding previous projections in various areas with 2020 and 2019 upward revisions partially offset by reductions in the estimated economic lives and future reserves of various properties in the Bakken due to declines in oil prices.   Changes in natural gas reserves for the years ended December 31, 2021, 2020, and 2019 include an upward revision of 7,991 mmcf in 2021 predominately due to ongoing development on our Permian Basin and Bakken properties and increases in the estimated economic lives and future reserves of properties in various areas due to increase in natural gas prices, a downward revision of 1,853 mmcf in 2020 primarily as a result of reductions in the estimated economic lives and future reserves of various properties in the Bakken, Barnett Shale and Fayetteville Shale due to declines in natural gas prices, partially offset by ongoing development on our Permian Basin and Bakken properties and well performance exceeding previous projections in various areas, and an upward revision of 6,466 mmcf in 2019 primarily as a result of increased Permian Basin and East Texas activity, partially offset by decreased activity in the Hugoton Field.   (2) On December 31, 2021, pursuant to a non-taxable contribution and exchange agreement with Gemini 5 Thirty, LP, a Texas limited partnership (“Gemini”), the Partnership acquired mineral and royalty interests representing approximately 4,600 net royalty acres located in 27 counties across New Mexico, Oklahoma, Texas and Wyoming. The acquisition represented 465 mbbls and 996 mmcf of 2021 purchases of minerals in place.   On June 30, 2021, pursuant to a contribution and exchange agreement with JSFM, LLC, a Wyoming limited liability company (“JSFM”), the Partnership acquired overriding royalty interests in the Bakken Trend totaling approximately 6,400 net royalty acres located in Dunn, McKenzie, McLean and Mountrail Counties, North Dakota. The acquisition represented 165 mbbls and 97 mmcf of 2021 purchases of minerals in place.   On March 29, 2019, pursuant to a Contribution and Exchange Agreement with H. Huffman & Co., A Limited Partnership, an Oklahoma limited partnership (“HHC”), The Buffalo Co., A Limited Partnership, an Oklahoma limited partnership (“TBC” and together with HHC, the “Acquired Entities”), Huffman Oil Co., L.L.C., an Oklahoma limited liability company, and the equity holders of the Acquired Entities, the Partnership acquired (i) a 96.97% net profits interest in certain working interests in various oil and gas properties owned by HHC, (ii) all of the minerals and royalty interests held by HHC, and (iii) all of the minerals and royalty interests held by TBC.   (3) During 2020, the Partnership and affiliates of its General Partner closed the divestitures of our Hugoton and HHC net profits interests. The Hugoton and HHC net profits interests properties represented 408 mbbls and 9,377 mmcf of 2019 end of year reserves.   F-12 Table of Contents   DORCHESTER MINERALS, L.P. (A Delaware Limited Partnership)   Supplemental Oil and Natural Gas Data (Unaudited)   Standardized Measure of Discounted Future Net Cash Flows (Dollars in Thousands Except Where Noted)       2021     2020     2019   Future estimated gross revenues   $ 602,130     $ 316,871     $ 452,992   Future estimated production costs     (34,002 )     (17,373 )     (25,542 ) Future estimated net revenues     568,128       299,498       427,450   10% annual discount for estimated timing of cash flows     (298,661 )     (162,666 )     (218,616 ) Standardized measure of discounted future estimated net cash flows   $ 269,467     $ 136,832     $ 208,834   Sales of oil and natural gas produced, net of production costs   $ (81,367 )   $ (40,064 )   $ (67,865 ) Net changes in prices and production costs     139,009       (48,962 )     (51,526 ) Net change due to purchase of minerals in place     17,023       -       17,843   Net change due to sales of minerals in place     -       (10,260 )     -   Revisions of previous quantity estimates     36,253       11,519       49,492   Accretion of discount     13,683       20,883       24,826   Change in production rate and other     8,034       (5,118 )     (12,200 ) Net change in standardized measure of discounted future estimated net cash flows   $ 132,635     $ (72,002 )   $ (39,430 ) Depletion of oil and natural gas properties (dollars per mcfe)   $ 0.80     $ 0.81     $ 0.81   Property acquisition costs   $ 40,770     $ -     $ 42,904   Average oil price per barrel (1)(2)   $ 59.23     $ 32.43     $ 44.38   Average natural gas price per mcf (1)   $ 2.83     $ 1.04     $ 1.72     (1) Includes Royalty and NPI prices combined by volumetric proportions. (2) Includes oil and natural gas liquids prices combined by volumetric proportions.   F-13