Our Unloved Energy Bet: Up 24% YTD And Paying +12%

At High Dividend Opportunities, our strategic investment in oil and gas came when sentiment was weak. Markets were worried about oversupply and declining demand, while energy equities were priced for a prolonged downturn.

We saw something different. OPEC+ spare capacity was dangerously low, and the geopolitical landscape was becoming increasingly fragile. In that environment, the margin for supply disruptions was razor-thin, and we saw opportunity.

Today, those investments are delivering. Our recent royalty purchases are up 23% year-to-date, while continuing to generate double-digit yields for our portfolio.

Join us at High Dividend Opportunities as we continue to capitalize on these market disconnects, and get paid to wait for value to be recognized.

On February 26th (before the U.S. - Iran tension evolved into military action), we wrote to our subscribers

“Venezuela and Iran have the first and third largest proven oil reserves in the world, but the former accounts for less than 1% of the global supply due to infrastructure decay, underinvestment, and tough sanctions. Iran, on the other hand, is the fifth-largest producer, accounting for ~4% of the world's daily oil supply. The tension between the U.S. and Iran will influence oil prices more profoundly, as the Strait of Hormuz is the most critical oil chokepoint in the world, with 20 million barrels of oil per day passing through it.”

Let us look at our top picks that enable us to collect big dividends from elevated energy prices, and from steady demand in supplies from reliable markets.

1) KRP – Yield 9.7%

Kimbell Royalty Partners (KRP) owns mineral royalty interests in 133,000 gross wells across over 17 million gross acres in key energy basins in the U.S. The company ended 2025 with 85 rigs actively drilling on its acreage. This represents 16% of all land rigs drilling in the U.S.

KRP has consistently grown its run-rate average daily production levels since its IPO, despite volatile commodity prices. For 2026, the company projects daily production between 24,000 and 27,000 Boe/d, which leads us to estimate a distribution of $1.32-$1.50/share, calculating to a 9.6% yield at the midpoint of this range. Typically, ~100% of KRP’s distributions are considered Return of Capital, making them highly advantageous from a taxation standpoint.

KRP declared a $0.37/share dividend for Q4 2025, and expects the 2026 distribution to be between $1.32-$1.50/share, calculating to a 9.7% yield at the midpoint of this range.

2) DMLP – Yield 10.4%

If KRP is a natural gas play, then Dorchester Minerals (DMLP) is one of crude oil, with 86% of the partnership’s 2025 net revenues coming from black gold.

Distributions fluctuate with commodity prices and volumes, but the partnership has a long track record of paying generous payouts across market cycles. Some of the largest diversified E&P firms are top operators in DMLP’s acreage, and 100% of the partnership’s distributions are tax-deferred due to its MLP status. Based on recent distributions and current commodity prices, DMLP is offering a +10% yield.

DMLP maintains one of the most boring business models, and almost never conducts conference calls or puts out flashy presentations. That simplicity makes it an ideal component of our boring portfolio—one that quietly gushes cash flow to investors, quarter after quarter.

Conclusion

At High Dividend Opportunities, we embrace out-of-favor, but necessary sectors, that are generous with their cash payouts to shareholders. Oil and Natural Gas have been our top buys in Q4 2025 and in early 2026, and we are very happy with our capital gain and steady income. Interested in finding out what we are buying now? Join us to explore our recent purchase of another high-quality company in an out-of-favor industry.