I’m back! A bit jet-lagged after a wonderful family vacation, and starting out with a little fogginess of the brain (I blame the Hákarl), so today’s de-tease is coming out later and will probably take a little longer than usual… but bear with me. Here’s how the ad starts:

“Over $810 Million ALREADY Distributed… With the Next Payout Coming July 2026

“Collect Monthly AI Income… Without Buying a Single Tech Stock

“‘My top pick for 2026 is NOT a stock, bond, or private company… It’s a little-known alternative investment that could hand you consistent income from artificial intelligence.’
– Marc Lichtenfeld, Chief Income Strategist, The Oxford Club”

So yes, Marc Lichtenfeld is out with another pitch for his Oxford Income Letter ($99/yr, no refunds, “second year free” guarantee if dissatisfied), and it’s focused on what he calls “Monthly AI Income” — so what’s he teasing?

Let’s dig into the details. He doesn’t make a transcript of the ad, unfortunately, but we’ll pull some quotes from his presentation and see if we can name that investment for you.

Here’s how he introduces the idea:

“What I want to tell you about is one specific data center being developed in West Texas right now…. And if you make the right move today, it could soon funnel a massive stream of income directly to you, an income stream most tech investors will never hear about. That’s because that has nothing to do with programmers nor the venture capital firms who fund them, and it won’t be generated from picking the right tech stock. It starts with something far more fundamental.”

And the implication is that these data centers are paying out big income already:

“Every time a teenager asks chat GPT to write their essay, every time Alexa plays a song, every time Tesla’s autopilot makes a split second decision, every time Netflix recommends your next binge, a payment will be triggered. Money that’s already flowing to the wealthiest institutions on Wall Street, BlackRock, Vanguard, the big banks, they’ve been quietly collecting millions In fact, since the launch of ChatGPT, we’re talking about $810 million in payouts.

“But as I’ll show you, there’s a way for everyday Americans to tap into the same income stream…. That $810 million is just the beginning. With the expansion of these giant AI data centers, I believe that income stream is about to explode.”

So it’s largely a “buy the hidden play, not the highflying tech stock” pitch:

“You don’t need to buy a single tech stock. You don’t need to be an accredited investor. It’s available to anybody….

“… if you’re looking to pile into Nvidia at $4 trillion or chase Microsoft even higher, I’m sure you’ll probably do okay. I wouldn’t recommend it because I’ve found a much better way to play the AI boom, an alternative investment with much more upside potential and less risk….

“… it’s an unusual way to directly profit from the AI boom by investing in companies providing the lifeblood to the AI operation while collecting steady income to boot.”

And what’s that “lifeblood,” you ask? No surprise, it’s power…

“See, up until now, winning the race for AI dominance has been all about developing the fastest, most powerful chips. That’s why companies like Nvidia and Supermicrocomputer and AMD have seen their share prices absolutely surge. These are the kinds of companies I was recommending back in 2023, including Broadcom, before it surged for as much as an 800% gain. Early investors in these chip makers have seen life-changing returns over the years. Now that was phase one. Now, we’re entering phase two of the AI boom, and it’s all about powering those chips because it takes an insane amount of energy to power AI and all its various applications. These AI systems are power-hungry monsters…. The computational power required to sustain AI is doubling every 100 days.”

So that’s a lot of the “AI needs more electricity” argument we’ve heard from dozens of pundits over the past couple years — nothing new there, that’s why utilities and power equipment companies and nuclear power hopefuls have had their moments in the sun over the past few years, but here’s how Lichtenfeld sums it up:

“The International Energy Agency warns that AI will soon consume more electricity than the entire nation of Japan. In America alone, data centers will account for nearly half of all electricity growth over the next five years. Meta’s new Prometheus supercomputer, just one system, will devour the same amount of power required to run one million American homes.”

And it’s true, data centers are not a huge part of power demand in most of the country just yet… but they’re growing a lot faster than anything else, and, more importantly, in the years going into this surge, investment in new generation and modernizing the electric grid was stagnant, largely because electricity demand had been essentially flat for more than a decade in the US. Which means that even increasing electricity demand by just five or ten percent over a few years is a big deal.

He goes on:

“And where will the majority of this extra energy come from? Well, it won’t be from solar. It’s just too unreliable. Not wind. They can’t scale it fast enough. And not nuclear, at least not anytime soon.

“There’s only one logical answer. American oil and gas. The same American oil and gas that powered the Industrial Revolution. The same energy that fed our factories to win World War II. The same resource that made America the most powerful nation on Earth. And now it’s going to power the AI revolution.

“According to Goldman Sachs, most of the massive new energy demand from AI will be met by fossil fuels. And America is sitting on more of it than almost anyone else on Earth.”

That’s at least partially true, the demand for new power generation has to be met almost entirely by natural gas (not from oil, since oil, and even the diesel backup generators which most data centers rely on, are a relatively tiny portion of electricity generation) — there are other sources, of course, including restarted nuclear and coal plants, the promise of an eventual boom in small modular nuclear reactors, and the gradual improvements we’re seeing from renewable energy plus battery storage facilities… but if you want to spin up a meaningful new power plant in the next five years, it’s almost certainly going to be burning natural gas.

More from Lichtenfeld:

“Energy is about to undergo the biggest boom in history. And for investors who know how to play it, it is the financial opportunity of a lifetime.

“I’m going to show you my number one way to profit from this unprecedented situation. It’s a unique investment that lets you tap directly into America’s surging oil and gas production and turn it into a steady stream of monthly income.”

So what energy investment is he pitching? Here’s how he finally introduces it:

“The oil investment I want to tell you about is Charlie Munger’s favorite investment. Billionaire Charlie Munger was the chairman of Berkshire Hathaway and Warren Buffett’s right-hand man. But before he partnered with Buffett, he discovered arguably the greatest passive investment in history.

“It all started on a golf course in Nebraska. It was 1962, and Munger was golfing with a new friend, Al Marshall. Munger was working as a real estate lawyer at a firm he founded. He hadn’t yet joined Berkshire Hathaway. His friend Marshall had experience working for several oil producers like Chevron, and he told Munger about a little-known oil play that could hand him big monthly income with just a small investment.

“By hole number three, Munger was dying to get in and asked Marshall to partner with him, and that’s exactly what they did. He and Marshall put up $1,000 each to buy one of these investments, and this single $1,000 investment delivered Munger the returns of a lifetime. 60 years later, his $1,000 still gave him $70,000 a year in income. All in all, he collected about a million dollars on his $1,000 investment.”

OK, so that means Lichtenfeld is again pitching oil and gas royalties — and yes, Charlie Munger talked often about how those royalties he bought into in California turned into an incredible windfall, years before he bought into legendary investments like Costco or partnered with Warren Buffett at Berkshire Hathaway.

Here’s how Lichtenfeld describes oil and gas royalties:

“Think of them as a backdoor way to get paid over and over again from America’s most valuable energy fields. You don’t drill. You don’t hire the rig workers. You don’t buy equipment or deal with permits. You simply own the mineral rights beneath the land and collect a cut every time oil or gas gets pulled out of the ground. It is passive income in its purest form.”

And how does he think we should buy into these royalties? This isn’t about buying directly into a royalty like Charlie Munger did, or like ranchers in Texas who sell their mineral rights and collect “mailbox money,” what he’s talking about is buying into a publicly traded investment that owns royalties.

In his words:

“I’ve found the perfect opportunity that lets you tap into these royalties immediately. You see, there’s a little known way to get into oil and gas royalties that’s brain dead simple. You don’t need to buy up land in Texas. You don’t need to be a millionaire. You don’t need to fill out any complicated paperwork. All you need is a regular brokerage account.

“… a few of these oil and gas royalty interests are listed and traded on the New York Stock Exchange. So you can buy and sell them just like you would a regular stock. Now, these royalties fly under the radar because you aren’t likely to hear them touted on CNBC or Fox Business. They’re completely outside the mainstream. But for those in the know, they’re one of the best ways to make big income in today’s market. All you have to do is buy one of these royalty interests in your regular brokerage account, then collect the payout. It is that simple. And I found by far the best oil royalty investment you can make right now.”

I’m sure it’s no coincidence that Lichtenfeld is dropping the names of some legendary investors in this tease, mentioning both Munger and Buffett:

“As Warren Buffett once said, the best business is a royalty on the growth of others, requiring little capital itself.

“All the hard work is done by the big oil and gas companies, and they bear the majority of the risk. Then, every single time they sell a barrel of oil or a cubic foot of natural gas, you get paid. If oil prices soar, you benefit automatically. Your percentage stays the same, but the dollar value increases. If a drilling company goes bankrupt, you still own the mineral rights. A new operator often steps in and the checks keep coming. In Texas, they call oil royalties mailbox money because you walk out, open up the mailbox, and the check is there. It’s as easy as it gets.”

So… which of the publicly traded royalty investments does Lichtenfeld think we should buy? Here’s how he begins to hint at that:

“I’m going to discuss my number one royalty opportunity, one that gives you access to some of the most profitable energy reserves in the country. You make a single investment and start collecting royalties like clockwork….

“One particular royalty you can own lets you collect steady income from nearly 900,000 acres of oil-rich land in Texas and New Mexico. A $1,000 investment in this little known royalty stream in 2000 is worth more than $556,454 in 2025, with dividends reinvested. That is over a 55,000% return on your money. It absolutely crushes Exxon. That’s 85 times more profitable than owning Exxon over the same period….

“And here’s the kicker. This oil and gas royalty has a history of paying out consistent income going back 137 years. Since the launch of ChatGPT, it paid out over $810 million, and I fully expect the value to only get bigger and bigger. It is perhaps the perfect investment.”

That might start to sound a little familiar to longtime Gumshoe readers, particularly that “137 years” bit… but don’t spoil the surprise for the rest of the class just yet. More from the ad:

“… let me show you why this particular royalty is perfectly positioned for the AI boom. It all comes down to one state, Texas. Right now, Texas has 448 data centers. By 2030, the number of data centers in Texas alone is projected to increase tenfold. Google just announced a $40 billion investment to build three new AI data centers in Texas….

“Meta is pouring $1.5 billion into a data center in El Paso. Chevron is building a 2.5 gigawatt power plant in West Texas specifically to fuel AI data centers. Vantage Data Center just announced a $25 billion mega campus in Texas, 10 data centers on 1,200 acres… and then there’s Stargate….

“All told, more than 220 gigawatts of projects will soon be connected to the Texas power grid. That’s more than double the state’s current electricity capacity.”

And it’s not just about power:

“AI data centers need three things. They need land. They need energy and they need water….

“Texas’ Permian Basin… the largest oil-producing basin in America. It pumps out over 5 million barrels of oil every single day. That’s almost half the U.S. supply….

“The water part, that’s the one most people overlook. All those servers generate tremendous heat and you need massive amounts of water to keep them cool. A single large data center consumes up to 5 million gallons of water per day… multiply that by 137 data centers currently under construction in Texas alone. We’re talking about enough water to supply a larger city than Los Angeles.”

“Add it all up, and you’ve got the biggest infrastructure boom in American history unfolding right now in West Texas. And one company sits at the epicenter of it all. It owns nearly 900,000 acres of West Texas land that’s bigger than Yosemite National Park, And unlike a typical oil company, this royalty company doesn’t just collect oil and gas royalties. It owns the land, the oil and gas, and the water rights. In other words, it owns everything these AI data centers need to operate. It’s like having a monopoly on the exact resources that these trillion-dollar tech companies are desperate to get their hands on.”

And then, just to check the final clue…

“Billionaire investor Murray Stahl calls it, “the longest duration compounding machine I’ve ever seen.” He put $2.9 billion of his own money into it. And Wall Street is catching on. In 2024, this royalty was the number one best performing oil and energy stock in the entire S&P 500, the seventh best performer overall, up 127% in a single year. It beat Netflix, it beat Tesla, it beat nearly every stock on the market. The company set records across almost every major metric. Oil and gas royalty production, water sales, net income, free cash flow. Not only that, they paid their shareholders $347 million in dividends, a new all-time high.”

And Lichtenfeld’s prediction:

“… you can target wealth two different ways. First, from the share price, as AI data centers flood into West Texas, demand for the company’s resources will skyrocket. And it’s likely the stock price will surge as well.

“Second, from the income. Every quarter, this royalty firm sends dividend checks to shareholders, and as production increases, those checks should get bigger and bigger. It’s the best of both worlds, capital gains and income. That’s why this is my number one royalty play for the AI energy boom.”

So yes, as many of you guessed well before we got this far, that’s Texas Pacific Land (TPL) — no real surprise there, it’s the longtime leader in the oil and gas royalty space in West Texas, has been around for almost 150 years, and was really promoted and shepherded into market leadership by Murray Stahl over the past few decades.

Since we’ve been talking about how similar the AI infrastructure boom appears to the railroad bubble of the late 19th century, it’s also interesting that TPL was and has been one of the top performers in the stock market this century, but it also traces its roots to that railroad bubble. The Texas & Pacific Railroad was created with massive federal incentives in the 1870s, which led to them being granted thousands of acres of land in exchange for laying track… and then when the Texas & Pacific went bust in the “overbuilt” bust, all that was left for the creditors was that massive bank of land. That led to the creation of the Texas Pacific Land Trust in 1888, with the Trust, owned by those creditors, having a mandate to gradually sell off that land to help generate some return for those broken investors. Thankfully, they did so very slowly, because ~30 years later the oil discoveries in West Texas made everyone realize that the mineral rights attached to that land might be a lot more valuable than anyone ever expected.

That led to great returns for Texas Pacific Land Trust from the 1920s into the 1970s, but then the Permian Basin went into pretty steady decline, the big gushers were gone, and things looked pretty ugly from the 1980s into the early 2000s, when the fracking and horizontal drilling that had been pioneered in North Dakota were brought to the Permian, creating another huge phase of growth and once again making West Texas the center of US oil production.

So that’s part of the reason that TPL has been one of the best investments of this century, it’s because it went from cheap, forgotten and beaten down in 2000, when oil prices were low and production was minuscule in the Permian… to enjoying decades of windfalls as oil and gas production again started to boom in Texas. The story is more complicated, as Murray Stahl also played a big role in helping TPL become more shareholder friendly, converting from a liquidating trust into a corporation, and building up their water and surface land business even as they pushed most of their cash flow into massive share buybacks (and, yes, a small dividend — but the dividend doesn’t excite anyone, the yield is well below 1%).

This is also the stock that Lichtenfeld was touting as the “29% Account” earlier this year, in a much more misleading ad — 29% was roughly the average annual total return for TPL shareholders who bought in 2000 and held through today.

I can’t argue with TPL as an investment, except to just say that it ain’t cheap right now. I’ve been gradually building a position myself to diversify my oil and gas exposure, starting when the stock had a meaningful pullback after the announcement of Murray Stahl’s passing, since he was the highest-profile champion of TPL’s potential, and his Horizon Kinetics was its largest shareholder (the initial fear was that without Murray Stahl, Horizon might start selling TPL… but that large position, and Horizon Kinetics’ ongoing consistent buying — literally buying a single share every day — has continued in Stahl’s absence).

The impact of data centers on TPL’s income stream is likely to be gradual, but it’s an extremely efficient company, even though they’re no longer an entirely passive royalty trust… they still have 50-60% margins, even on the water side of the business, where they’ve been making some meaningful capital investments. I expect it to continue to do well as long as oil and gas production in the Permian Basin at least remains fairly steady, and very well if production grows, in part because the demand for water handling and water disposal from the extremely water-intensive fracking operations in the basin are growing faster than oil and gas production, and in part because gas is becoming a larger part of the business (in the early days of fracking the Permian, gas was often just burned off because there was no infrastructure to capture it — but that’s no longer true, with more natural gas pipelines and collection systems being built to corral that gas). TPL revenue, as of last year, was 52% from oil and gas royalties (of which about 31% was from natural gas, with the remainder split between oil and NGLs), 11% from surface stuff (including stuff like quarries and land sales and leases), and 37% from water (both produced water sales and water-related royalties).

The cash flow is great, growth in the water business is pretty exceptional, and they pay a small dividend and buy back lots of shares — so as long as oil and gas remain important commodities and don’t truly collapse in price (ie, falling back below $50 oil and $2 natural gas), the future looks pretty bright. But the stock is also probably a little bit inflated by anticipation of selling tons of land and natural gas to dozens of huge new data centers, so shares could certainly come under a lot more pressure if that investment cycle seems to really hit some speedbumps. I like TPL, and like the diversification it brings to my portfolio, but the valuation means it’s probably not the most opportunistic investment if you want more leverage to potentially rising oil and gas prices — for just energy exposure, I’d be more inclined to build (and did build) a position in Viper Energy (VNOM) first, though VNOM has nothing directly to do with water or land.

And Lichtenfeld also has another royalty firm he likes… here’s how he sells that idea:

“There’s a second royalty play that could be just as lucrative… another powerful royalty play that lets you tap directly into the same oil-rich region.

“This single royalty lets you profit from over 380,000 acres in prime oil and gas fields. It generated over $120 million in revenue over the past four years. It has no debt and pays out its earnings back to shareholders. And get this, since it’s a royalty trust, 95% of all of its income is paid out to investors.

“And you can own a piece of this royalty stream for under $20. And best of all, it pays out every single month like clockwork. This trust has been sending royalty income to investors for decades, more than 300 consecutive monthly payouts. Through bull markets and bear markets, through recessions, recoveries, through oil booms and oil busts, the checks kept coming. Some big, some even bigger.”

That’s almost certainly Permian Basin Royalty Trust (PBT), which Lichtenfeld has been pitching since the Spring of 2023 — and, despite collapsing dividends, kept pitching for a couple years during which it was really, I’d argue, among the worst possible oil and gas royalty companies to invest in.

PBT is an odd story. It is a real royalty trust, unlike TPL, so it is inherently passive and can’t really do much, they can’t buy new royalties or reinvest… and it’s been a challenging business, because their most important property, the Waddell Ranch area in the Permian Basin, is not a royalty, but a net profits interest (NPI), which means that PBT doesn’t just earn a “royalty on the work of others” but has to pay their share of the operating expenses of drilling before they earn their share of the cash flow each year. NPI deals are tempting for land-owners, I suppose, because the fact that you’re willing to participate in operating costs means you can attract more potential operators… but they also drag you into the ugly part of the business, having to cover the expensive drilling and completing costs instead of just enjoying the top-line production and enjoying the luxury of ignoring operating costs.

And that led to PBT often getting very low distributions from their Waddell Ranch NPI over the past couple years, which meant that they had very low cash flow and their dividend shrunk. That led, in turn, to a long-running legal dispute, because PBT accused the operator of Waddell Ranch, Blackbeard, of over-charging them for the operating expenses of the wells over a couple years, essentially charging them for capital investments that shouldn’t have been included in operating costs.

So yes, PBT did have about $120 million in royalty receipts over the past four years, almost all of which was distributed as dividends… but that comes in the form of $55 million in the energy-crazy year of 2022, followed by big declines to $29 million, $27 million, and then a disastrous $16 million in 2025. The dividend fell from ~6% in 2023 to about 1-2% recently, and as a passive trust there wasn’t a whole lot PBT could do about any of this, other than suing Blackbeard.

That led to a settlement last year, which provided some smallish “catch up” payments from Blackbeard to help make up for the overcharging, and that goosed the dividend little bit… but, more importantly, it has also led to the biggest news from PBT in several years, as the settlement opened the door for an activist investor to negotiate a deal to merge Blackbeard and PBT into a new NYSE-listed corporation… which would clear up the “overcharging for expenses” issue by converting the NPI rights into a 15% top line royalty on Waddell Ranch, as well as adding Blackbeard’s other surface land rights to the combined company (another 60,000+ acres), and would enable more flexibility by converting PBT from a passive trust into a corporation (like the conversion Texas Pacific Land did five years ago).

So that proposed deal has some hope of creating a much more appealing investment, getting rid of the disastrous NPI deal that let Blackbeard eat up most of the profit from that property over the past five years (to be fair, they also dramatically increased production), and also playing on the same sort of “own the land and do other stuff, too” drive that created LandBridge (LB) and WaterBridge Infrastructure (WBI), other sort-of TPL copycats in West Texas (neither has real energy royalties, but benefits indirectly from water and surface land rights). It would also lead to some dilution, with Blackbeard’s parent owning 42% of the combined company, so the more stubborn PBT unitholders might be a big grumpy about how much Blackbeard would profit from overcharging PBT for so many years.

I don’t have a good understanding of what kind of valuation we’d be dealing with for the combined company, this is just a “non-binding term sheet” agreement between Softvest and Blackbeard so far, and the trustees of PBT can’t participate in the discussion or recommend a vote up or down, so, depending on the details, it might not be a great deal for PBT shareholders (Blackbeard’s parent will remain the operator, so they’ll keep the Waddell Ranch economics beyond that 15% royalty, in addition to owning 42% of the combined company), we’ll have to see how that develops… but I imagine, given how well the shares performed after this news came out, (they popped from $22 to $30 on the news, though have drifted back down to $25 as oil prices dropped more recently,) and how lousy the dividend has been for a few years, that unitholders will probably vote to approve the deal. It’s not likely to have the quality of TPL and its massive land ownership, and it probably won’t have the strong dividend income of some of the other royalty companies… but it might end up being a great deal if the merger/restructuring go well.

So that’s Lichtenfeld’s “AI royalties” — mostly a repackaging of two oil and gas royalty companies that he has touted before. See anything to like in those ideas? Have other favorites in the space, or prefer the actual oil and gas producers that generally trade at much lower valuations? Let us know with a comment below… thanks for reading!

Disclosure: Of the companies mentioned above, I own shares of Alphabet, NVIDIA, Texas Pacific Land, and Viper Energy. I will not trade in any covered stock for at least three days after publication, per Stock Gumshoe’s trading rules.