Good afternoon, ladies and gentlemen. Welcome to the annual meeting of shareholders of Freehold Royalties Ltd. I appreciate the good turnout we're getting today. I'm sure this beautiful Calgary spring day that the golf course was calling, but you made a much better decision. So let me thank you for attending today's 2024 annual meeting. My name is Marvin Romanow, and I am the Chairman of Freehold's board of directors. For the past three to four years, your board has focused on improving the talent level and execution capacity at the senior management level. The capability and success of this transformation and the strength of our team shows in the results we have delivered for shareholders. David Spyker, our CEO, was appointed three and a half years ago and will discuss these results in a few minutes.
The board has also turned its attention to overseeing the expansion of our business into the resource-rich oil and gas basins of Texas. This expansion is making our company better in numerous dimensions and, most importantly, in providing multiple years of drilling inventory and associated reserves that complement our Canadian asset base. We have also kept a keen eye on both board and corporate governance. We have taken steps to reduce our cyber risk. We have improved our governance scores provided by the key external rating agencies that rate us. Through this, we have also improved our environmental and social governance performance. These are relatively new areas of corporate ranking, and we score well on both of these fronts. Now, good corporate governance can't guarantee strong operating and financial results.
Your board takes a practical and applied approach to governance while primarily focusing on delivering the business results that investors expect and deserve. Today's meeting marks the 28th annual meeting for Freehold. Through the volatility of our industry, we take pride in the consistent returns Freehold has provided our investors over its history. We have paid a monthly dividend for the past 28 years, and we haven't missed a month. A rare accomplishment in our industry. I will now move on to the more formal part of the meeting, but before I do that, I would like to advise you that this meeting is being webcast, and all the references in my comments and in the slides are Canadian dollars unless otherwise noticed.
For those attending the AGM for the first time or for those new to Freehold, I would like to introduce our executive team, and I've asked each of you to stand when you're introduced. David Spyker, President and CEO. Rob King, Chief Operating Officer. David Hendry, Vice President of Finance and CFO. Lisa Farstad, Vice President Corporate Services. Ian Hanke, Vice President Diversified Royalties. And Susan Nagy, Vice President Business Development. For the purpose of the meeting today, voting on all matters except for termination of the meeting will be conducted by ballot. I would also like to introduce, standing for election today, all of our directors. Please stand as your name is called. Gary Bugeaud. We're not going by height. We're going by alphabetical order. Maureen Howe. Douglas Kay. Kimberly Lynch Proctor. Valerie Mitchell. Myself, Marvin Romanow. Mathieu Roy.
Related to the goalie, but you can talk to him later about that. David Spyker, who is also President and CEO of Freehold. And Aidan Walsh. I would also like to introduce the representatives from KPMG, our auditors, Heather Steinley. Way at the back. And Lindsay Fone. Right next. I would like to recognize Sylvia Barnes, who is not standing for reelection to the board at this meeting. We thank Sylvia for the many contributions she has made to the company. Peter Harrison will also not be standing for reelection and will retire from Freehold's board of directors. Mr. Harrison is a founder of Freehold and has been a Freehold board member since its initial public offering in 1996. There are very few people in town here who get to tag founder besides their name. And we do not hold it against Peter that he still resides in Montreal.
We think he brings enormous capability and has done a wonderful job for the company. He has been instrumental in the growth and success of our company. We have to thank him and want to thank him for everything that he has contributed to Freehold over the past 28 years. For his very hard work, his wisdom, and his leadership throughout his tenure on the board. Peter, I will miss your steady, positive, and practical approach to managing businesses. We wish you all the best in your retirement. Maybe he'll relocate to Calgary in his retirement. He's been here enough times. Standing for election today for the first time are Kim Lynch Proctor and Mathieu Roy. Miss Lynch Proctor is an independent businesswoman and an experienced tax lawyer, accountant, and executive with over 25 years of industry experience.
Her prior roles include chief financial officer and general counsel of Kern Partners Ltd, an energy-focused private equity firm, and a practicing lawyer and chartered professional accountant with Felesky Flynn, Bennett Jones, and Deloitte. Miss Lynch Proctor holds both a Bachelor of Commerce and a Bachelor of Laws degrees from the University of Calgary, a Master of Laws degrees from New York University, and is also a chartered professional accountant. She holds an ICD designation from the Institute of Corporate Directors. Welcome. Mr. Roy is a managing director of Real Assets at CN Investment Division. I'm sure that I have not yet met his counterpart who is managing Unreal Assets at the pension fund, but you can ask Matthew about that later.
He has over 20 years of experience in capital markets, including 16 years at the CN Investment Division, and he's recently just taken on more responsibilities, including ourselves and a few other things. So we look forward to his participation on our board. He has been attending meetings as a guest for the last little while, so he's not going to get any benefit of training wheels. We expect him to contribute from day one. Mr. Roy holds a Bachelor and Master's degree in finance from the University of Sherbrooke, and he is a chartered financial analyst. Kim and Matthew will be key contributors to the growth of Freehold for many years to come. We appreciate them standing for election today. We are a company with a lot of stability. Just yesterday, I learned that in our 28-year history, we've only had four CEOs and three chairmen.
I think that is a remarkable amount of stability, and I think it's part of what's delivered, the performance that you're going to see Dave talk about. Okay. Now we move to the start of the formal part of the meeting. To make best use of our time, we have prearranged with certain shareholders attending today to move and to second the resolutions, which we'll consider in one motion today and which are set out in the notice of meeting. Other than the election of directors, all matters will be considered and will be put to a vote by a single motion. Shareholders will, though, be able to vote on each of the matters separately by ballot. If you have already sent in your proxy, your vote has already been counted, and you do not need to vote at this meeting.
We ask that questions during this formal part of the meeting refer only to the matters set out in the notice of meeting. Following this formal part of the meeting, after we adjourn it, David Spyker will be making a presentation, including with very colorful slides, to update you on our business results and our strategies. He and I will be happy to answer any additional questions at that time. The meeting will now come to order. I am the Chairman of Freehold and will act as Chairman of the meeting. Brianna Guenther at the far right there, my right, and representatives of the Computershare Trust Company of Canada will act as scrutineers.
I have received the sworn affidavit as to the meeting of notice of annual meeting of shareholders, of the mailing of the notice of annual meeting of shareholders, the information circular, the instrument of proxy, and the annual report to shareholders. I direct that this sworn affidavit, together with copies of the documents mailed to the shareholders, be kept by the secretary with the minutes of this meeting. A quorum for a meeting of shareholders of the corporation is 25% or greater of the outstanding common shares present in person or by proxy. There is a quorum today, and in excess of 49% of the shares have been voted by proxy. The interim scrutineers' report indicates that a majority of shares have voted and have voted in favor of each of the matters to be considered at today's meeting, including the election of each of the director nominees.
I now declare the meeting to be regularly called and properly constituted for the transaction of business. We will now move to voting. We will conduct each vote by way of ballot other than termination of the meeting. I understand that the scrutineers have collected all the ballots, and if you have a ballot, please provide it to the scrutineers now. The annual financial report to shareholders, which includes the financial statements of the corporation for the fiscal year ended December 31st, 2023, and the auditor's report for the same period was mailed to those shareholders who requested it. There are extra copies of the report available here today. They are also available on Freehold's website as well as on SEDAR+'s website.
As noted earlier, to make best use of our time, I will be asking for a motion to consider and, if thought appropriate, approve certain of the remaining items of business set forth in Freehold's notice of annual meeting and management information circular. However, before doing so, I will speak to the nomination and election of the directors of Freehold. According to the governance agreement between Freehold and Rife Resources, Rife is a wholly owned subsidiary of CN. Rife has the right to nominate two individuals for election as directors. Rife has nominated Mathieu Roy and David Spyker for election as directors of the corporation. In accordance with this governance agreement and the advanced notice bylaw of Freehold, the only individuals entitled to be nominated as directors at this meeting are the persons named as nominees in the information circular.
Therefore, as directed by the board and in accordance with the notice of meeting and information circular, these persons, Gary Bugeaud, Maureen Howe, Douglas Kay, Kimberly Lynch Proctor, Valerie Mitchell, Marvin Romanow, Mathieu Roy, David Spyker, and Aidan Walsh, are hereby nominated as directors at Freehold or directors of Freehold to hold office until the next annual election of directors or until their successors are elected or appointed, subject to the provisions of the Business Corporations Act and the bylaws of Freehold. Is there any discussion or question from any registered shareholder or proxy holder? The rule of thumb I use at meetings when I ask questions like this is eight seconds. And eight seconds can be a long time. Okay. We've got our eight seconds in. I declare those nominated as duly elected directors of Freehold.
Particulars of the votes cast on the election of directors will be available via news release after the meeting. I will now ask for a motion to approve each of the remaining items of business set forth in Freehold's notice of annual meeting and management information circular.
Mr. Chairman, I move that the firm of KPMG LLP, Chartered Accountants, be appointed auditors of Freehold until the next annual meeting or until their successors are appointed. And that the resolution set forth in Freehold's information circular regarding Freehold's approach to executive compensation be approved and adopted.
Mr. Chairman, I second the motion.
Is there any discussion or questions from any registered shareholder or proxy holder? I have been advised by the scrutineers that each of the matters considered today have been approved by the requisite majorities. I direct that the scrutineers' report be annexed to the minutes of this meeting as a schedule. As mentioned earlier, the results of the votes will be made available in a news release to be issued by Freehold and in a report of voting results to be posted on SEDAR+. Unless there are any questions of the floor, I would entertain a motion that the meeting be terminated. Give me a few seconds, Dave.
Mr. Chairman, I move this meeting be terminated.
All in favor, please raise your hand. Any contrary? I declare the formal portion of this meeting terminated. David Spyker will now provide an update on Freehold's activities. But before I turn the meeting over to Mr. Spyker, does anyone have any additional questions at this time? David, the floor is yours.
Thank you, Marvin. So over the past 3-4 years, we've purposely built Freehold into a North American energy royalty company. We've done that by stepping out from Canada, where we've been established since 1996, and moved ourselves into some of the most prolific and economic basins in the U.S., biggest positions being in Texas, in both the Delaware, Midland, and Eagle Ford basins. With that, we've been able to deliver production per share growth to our shareholders, and we've really been focused on moving our liquids weighting up. So the bulk of our production is going to be oil and NGL, which would make up about 64% of our production, and it drives 90% of our revenue. A couple of the reasons that we're really appealing to the U.S. is that we get quite a bit premium pricing.
So overall, our U.S. portfolio drives about a 47% premium to what we get in Canada. On an oil basis, it's about a 28% higher oil price that we get. That's just due to proximity to markets. So core to our business is providing our shareholders with a high-quality, sustainable dividend. We've had a 12% average return since our IPO in 1996. That 12% has outperformed the S&P 500, the TSX Composite Index, and the TSX Energy Index. We believe that the nature of our business being a royalty, that we can be very sustainable beyond commodity prices, much lower than where we are today.
So if we look at our industry peers, we're at top tier, but we think because that we don't have any capital costs in our business, any operating costs in our business, that dividend where we're at right now, about a 7.5% yield, is very sustainable. We've always paid a dividend. As Marvin mentioned, this past year, we paid CAD 160 million out to our shareholders in the form of a dividend. And over the lifetime of the company, we paid out CAD 2.1 billion worth. The extra money over and above the dividend, we've been really focused on investing into the portfolio. And you can see that on the return on capital employed with our U.S. expansion, we've continually outpaced our royalty peers in how we deploy that capital and build our business.
So it's patient investment and it's very strategic in basins that we think are going to continue to attract capital. What we wanted to do today is just spend a little bit of time talking about the U.S., what we've learned since our first major acquisition in 2021. First off, what attracted us to the Permian is just the unparalleled pay that exists. So the Permian is here, Midland, Delaware. This is kind of a pictorial of the amount of pay thickness present. So Midland, we're talking about 3,500 feet. Delaware, 4,000 feet. In the Canadian Basin, the western part of Western Canadian Sedimentary Basin, that same thick pay stack exists. We talk a lot about those plays, the Montney, the Duvernay, Cardium Deep Basin. The big difference between the two is that in the Permian, not only do we get a premium pricing, but it's all mineral title land.
We can acquire mineral title land in the best rock in North America under the operators that we want in the thickest parts of the pay. When we're buying mineral title, just like in Canada, we're buying from the roots of the grass to the center of the earth. We're getting the whole stack. What we originally evaluate, what I'll show you is that there's a lot more zones that are starting to contribute than we ever thought even when we bought it. We like BC, Alberta, West 5, West 6. The fact of the matter is there's no mineral title in there. You can't build a position with mineral title. Hence, we're moving down to the U.S. We get the thickest stack of pay. We're scalable.
When we look at the Canadian acquisitions on a publicly disclosed basis, the deals are about 10-to-1 in the U.S. So to put that into perspective, those are just the public data that would be kind of CAD 10 million and above. We see transactions daily in the sub-CAD 10 million range. So there's just so many different ways to put the puzzle pieces together that we don't get in the Canadian side of the portfolio. This is what I was referring to. When we originally started looking at the Permian in 2020, we did our first deal in early 2021. Really, we were focused on valuing these primary targets. What we're seeing over the past 3 years-4 years is that the emerging targets that's really driving the growth and I'm using Midland as an example. The same would be on the Delaware side.
But those primary targets that we initially valued, they've grown at about 170,000 barrels over this time period. The emerging targets are 375,000. And we see that continuing. So as operators are focused on maximizing value throughout the resource stack and substantially increasing recovery from the basin. And this, for us, is free upside. We didn't pay for it. It doesn't take incremental capital to develop. And we're starting to see this roll through in our reserve reporting. From a financial perspective, we've got super comfortable with the reserves. The financial performance of the assets is, again, exceeding expectations. We invested on behalf of shareholders CAD 565 million into the U.S. with the first investment in January of 2020. That first investment was CAD 74 million. That'll pay out fully this quarter. The whole portfolio of 565, we're expecting that to pay out in 2026.
It's going to pay out again in 2032. This slope of the graph isn't changing. We see that just continually paying out, paying out. When we look at match the reserves to the financial performance, we're talking payout in the next couple of years here. We've produced about 12% of the reserves that we have booked. So there's just lots of value to give in these assets. So what we're seeing is financial performance exceeding expectations and reserves exceeding expectations, a lot of it with those emerging benches. The one thing that we do find the difference between Canada and the U.S. is the U.S. production is a lot more volatile. So we've crushed the financial, crushed the reserves. But what we do see is volatility. That's driven by a number of things. We have scattered drill spacing units.
So the yellow one here, where we would be owning lands. And so this would be if you think of Canada, this would be one mile by one mile, so a section of land. And so you can see how our lands are positioned, this little snapshot of the core of the Permian. You can see here that we've got some wells on production in blue. Over here, we've got wells that are either permitted or drilled and uncompleted. You can see lots of rig activity in the area. So we're in the core of the play. What we see here is that the well performance, we're not seeing any degradation in well performance with time. The most recent wells are still outperforming some of the historical type curves. And so we look at that and go, "We're in the right parts of the basin. We're under really good operators.
We don't know where the rig is going to go, but we got lots of drilling room." The royalty interest that we have in each of those drill spacing units can vary significantly across the portfolio. So that does have an impact on the impact of a well coming on production. And one of the other things that we see is a pad here, for instance, would be drilled. 20 wells would come on stream. So there's 20,000 barrels a day of production comes on at once when that operator, a year after he started drilling, brings that production on. So you get quite a production spike, and then you get a decline off of that. So those are variables that we don't see in Canada but don't impact the underlying value. But it does drive volatility in the portfolio.
One of the other things that we've been very conscious of is just aligning with top operators in North America. This has evolved significantly over the past few years where on the Canadian side, our top 30 counterparties is about 18 Canadian firms and 12 U.S. firms. So we're aligned with the Tourmalines, the Whitecaps, Canadian Natural, Teine, Tamarack Valley, Crescent Point. So it's just really high-quality names in Canada that are developing our lands. Same within the U.S. We got Marathon Oil, ExxonMobil, Pioneer on the back of the deal, the CAD 116 million deal that we did in Q1. With that merger, they're our fourth-largest payer.
So when you think about the quality of an ExxonMobil and these guys are developing lands in five-year thought processes, five-year, ten-year business plans, they're not waking up every morning and looking at what the oil price is and deciding what to drill. And so we think by underpinning our portfolio with the likes of these names, again, it just ensures that the quality of the portfolio and that the pace of development will be there for years to come. I think that one of the things that goes underappreciated just with the royalty portfolio and our oil and NGL weighting and the exposure that we get with the U.S. premium pricing, we are number two. We try harder, but we're damn near there as far as what the cash flow per BOE that our portfolio generates. And no, this isn't PrairieSky.
This PrairieSky is down here somewhere. This is the one to the right of us is one of the public Clearwater players that are developing on our land. So no different than anyone else in this portfolio, if oil price goes up CAD 5, we get that same CAD 5-buck leverage that everyone else has. And we've already got a very strong cash flow per barrel. And so we can use that cash flow strength to continue to build the company, to continue to fund our growth initiatives as we look to the future. So with that, we're very proud of the work that the entire team has done in continually evolving Freehold to ensure our assets are well-positioned, that will attract future capital, and thus ensure the sustainability of our business.
We're taking a little bit different approach that we really want to share with our shareholders, what we've learned with the U.S., and just how strong we believe in the assets and how they materially moved our business forward. So with that, we have copies of the presentation available at the back. And if anyone has any questions, both Marvin and I will be pleased to answer those.
Generally, when you don't get any questions, you have two alternatives. Nobody understood what you said, or everyone understood it perfectly, and it's impossible to ask any good questions. Dave and I are going with number two. So thank you very much for attending this afternoon. We have quite a bit of food left over, and I think we have to-go boxes if you want to take some of that home.
I appreciate everyone taking time out of their day to come and say hello. Management and the board will be around for a little while longer. So if you feel more comfortable in asking us questions one-on-one, we're more than happy to stay here and do that. And thank you again very much for attending.