Earnings call transcript Q4 2022

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Operator

Good morning, and welcome to TETRA Technologies Fourth Quarter 2022 Results Conference Call. The speakers for today's call are Brady Murphy, Chief Executive Officer; and Elijio Serrano, Chief Financial Officer. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Mr. Serrano. sir. ahead go Please

Elijio Serrano

morning, Results you Call. [indiscernible].Good Fourth joining Quarter XXXX and you, for thank TETRA's Thank

control may are be I subject statements this on and contain uncertainties, or are conference and like certain to call deemed beyond would to made of of several many may several statements remind assumptions and based the that risks by are on These company. are statements forward-looking. you the analysis that be which based to TETRA are These factors.

that are of in You from may are future performance such projected cautioned statements differ not and the those results guarantees forward-looking statements. that actual materially

debt, In financial financial or EBITDA, addition, adjusted reconciliations free to to EBITDA Please the call, the net liquidity of for non-GAAP of margins, refer the release GAAP adjusted leverage other or to we net may measures. yesterday's ratio, non-GAAP EBITDA, our course refer press measures. gross website nearest to flow, measures public in cash

a not financial results information be context complete our are and prepared of considered the within reconciliations period. should GAAP with substitute for as These accordance the in financial for

our In yesterday. that press addition that to announcement out will we to encourage refer to be release yesterday, filed you went our XX-K

Brady turn over I will to you. it

Brady Murphy

outlook we some night. the section to strategic back to well XXXX good and our to highlights current morning, issued comment sheet, the turning it discuss that as fourth add Elijio, on flow, some Thanks, earnings economic capital initiatives to color analysis provided update last everyone. XX balance before cash TETRA's working as liquidity and Elijio and I'll SK quarter, XXXX the on summarize Welcome an call. quarter for fourth the

full market-to-market in strong growing quarter million in increased over year the over excluding We year the from million and XXXX sequentially XXXX. year the $XX.X XXXX. gains and quarter with strong X% closed XX% EBITDA Adjusted for $XX.X fourth for full out of quarter a the third in revenue a third

Our over incremental than a doubled, increasing adjusted XXX% through more on to EBITDA EBITDA revenue. by almost with follow XXXX incremental for XXXX XX%

fourth Despite spot of and capturing than pure during that mentioned fluid prices, purchase our challenges at sales overcame strengthening bromine we including completion the orders, and some we these the market. headwinds more multiple high quarter, offshore last need additional the market call, quarterly to postponement an flow that in margin increasingly by

XX% chain completion along year-on-year. markets Gulf second business XX% and Mexico combined in increase North improvements our the we the job For this successful businesses for first of supply by chemicals Neptune in international with of of scheduled our our and quarter contributed were continued job European disrupted Neptune Norway. than time The the quarterly sequential another UK offshore our more to to results the revenue QX Sea for

markets multiyear a the tree are floater entering we're that believe increases the for to underpinnings continue and offshore subsea rates, day in We belief. and orders cycle growth contract for durations

services past As already a segments is the situation. is energy projecting services say I over market certain oilfield floater why rigs concentration tight deepwater XX% result deepwater This supply eight the by are in offshore years in a increase XXXX. that a of

the Parks fourth Completion will of with business XX% the business operations. with inventory deepwater two fluids key servicing to we offshore our fluids further North acquisition completion almost by Gulf the acquiring Sea New fluid In Louisiana, strengthen the increase and and and took expand quarter, of These in capacity of of in Bucha Port in investments investments and XX% Sea steps Fluids North TETRA's and Mexico UK the sector the Gulf Mexico. completion by base deepwater

on XX%. from XXXX the new approximately margins million completion and points of $X.X segment million revenue and already fluids improved when and fourth of EBITDA the XX results by of close, periods. park million increase the XX% has acquired excluding products upon for The quarter from just financially inventory been of third gains basis contributed $XX EBITDA sequentially operations $XX Both sold. XXXX Adjusted sequentially, quarter by realized while increased losses of both

improved XX% quarter segment Shifting marks flat Flowback active to end and million XX% the revenues down or XXXX. our weather. EBITDA of increases frac quarter This $XX.X market and to $XX of Water by X% million due year and year-on-year quarter, second fourth quarterly the fleet consecutive in grew the slightly the and revenue quarter-on-quarter, revenue year-on-year. of the seventh a of since sequential million Adjusted highest $X.X somewhat

a slightly XX.X% from fourth fell to quarter lower margins adjusted margin due QX of mainly EBITDA mix Although of services.

and For the TETRA of fall XX.X% at increased by our for XX%. a or set $XX.X of of investments the over for deployment to expand production by grew XXXX facilities made through the reducing Argentina adjusted site. job slightly leveraging EBITDA revenue. expansion adjusted Growth a and the XXX% international and fleet capital revenue full our EBITDA for XX% of EBITDA achieved Flowback a XXXX sandstorms million to Water our XX% through automation margin, We year by adjusted with personnel driven operations in was by in investments from in early technology target

for the EBITDA to of year first adjusted expect and rebound We full in margins quarter the XXXX. beyond

have quarter. XXXX additional the operating second also we EPF in bring is consistent two operating as an contribution the expected in increase with To-date, Argentina been EPS International expectations. in online to

last expansion with term be we continue our invest years. new will we've But projects unless short as focus to margin of XXXX all returns. EBITDA over new will growth For cash generation optimistically on capital and in the couple achieved

plant from December, as As produced we're has commercial below operator. Texas design. oil gas our final of beneficial XX% tap that municipal water for previously for a major first desalinated equipment yielded desalination results reduced facility solids undergoing high in and the to with water. is enhancements The water for our further as water for dissolved project a and total reuse of returned average R&D very the field of pilot in results The the pleased with announced

recent to interest customer in events extraction. and Permian the in water beneficial restrictions, expected produced with the water increase significant mineral increasingly produced along in see Basin, seismicity reuse, we including and disposal With continue

Finally, smackover and report resources in initiatives XX technical financial advance to our an website bromine our development lithium for announcing the our formation brine SK-XXXX the review. release now of we the in continued quarter, in southwest and analysis for a our strategic the We on progress yesterday including fourth project with available on bromine press the section Arkansas. issued

project efforts to key continued A this regarding development. few supports points that potential resource evaluate this our fully

has term long agreement of runway. supply plenty Our current bromine

decision. about very be will and we So methodical our investment evaluation

provides the CapEx brine. for wells both resource in lithium and plant of report and our pipelines be report for than a production would And bromine of SK-XXXX proposed XX% although report bromine, section targeted XX XXXX within agreement. as on current supply feed our our the and XX inferred As estimates long in project bromine volume initially brine would part focuses for term reminder, estimated the XX% acres. our the The would more to support lithium bromine study that have Hardgrove both XX% section

of our supply on storage support conditions accommodate designed that tower offshore to what of cycle, are out be press meet yesterday energy estimate However, would in we project up release current that and as our we upcoming is forward XXX% itself us believe met If multiple from moving are this agreements. could oil well conservative to to the the laid a the gas our for as projected demand. this demand bromine

significant Although committed this resources opportunity. our to right to right fully effort explore methodical evaluation, and we in are the putting up

units with simply which to progress center the Finally scale. on our technology lab well at Texas carbonate, process. each establishing address stage of success from extraction our Woodlands a our Starting lithium smackover already lithium with we're producing to R&D we've Arkansas pilot raw continues in as demonstrated brine

We this our will communicate continue progress advances. to work as

Then to that, some turn open questions. up to Elijio some With for commentary. it I'll it we'll provide over additional

Elijio Serrano

quarter million Cash in Thank use you the in Brady driven end the mentioned. end activities end the ramp the was reflecting operations the by $XX that by some while flow the third from from the quarter of receivable large fourth previously the million sales Brady. quarter, continuing of from in use the $XX with of $X of strong increased of by million Accounts free to up quarter. cash activity December in the fluid fourth the adjusted quarter, operating

use million consumed Working $XXX capital the with end quarter. a and of $XX.X at of in as the to third to million cash million billion quarter $X.X fourth $XX.X of the capital at the compares cash Working the year of end third compared quarter. in of the

$XX increase investments made [indiscernible] and in in expenditures international Capital in position early $XX to Sandstorm and to with capacity filtration as short long expenditures and investment facilities capital Total fluids markets term completion were to and the compared payback quarter. for million production business. in our the strengthen year third million our such were the investments offshore technology reflect $X.X quick million and Argentina

the payback was where The XXXX sandstorms on end materially XXXX. free year. first be expenditures result revenue while at margins the strong the is accounts we agreements the in second XXXX. and to in cash $XX that credit in generation much year, our the was evident compared early significant on monetized flow of was facilities receivable half was CapEx will built lower the the of in to this in half increase very fourth cash production XXXX. unrestricted $XX our In combinations expended under to achieve in investments growth the on quarterly availability of expect below At million EBITDA the if of XXXX, end These Capital of million. the quarter, expected we

million over million to XX, lending leverage at improved September ratio As with year yesterday, million X.XX Long quarter. times term under million. maturity end the $XX our loan $XX existing was net $XX is XXXX million, as of end under $XXX while September million our the asset term Net been of have borrowings had a with to Outstanding by XXXX XXXX. debt fourth net based is $XXX from $XXX debt of the September borrowers of $XXX no debt by reduced XX, million liquidity facility. by the

lithium, price. restrictions not addition of based significant cash earlier, the approximately XXX,XXX we $X.X some value closing on marketable liquidity market million standard any holding currently shares. are the mentioned of have In a yesterday's with holding to do shares We selling on We're and securities. I

to expect XXX,XXX receive We in shares another May.

holding common CSI approximately value yesterday's on a are compressed approximately code, million price. of based X.X closing million units of market with also $X We

$XX at also is selling slightly We these million. have The traded. valued don't in investment of common investments This total publicly this restrictions is $X currently not approximately one our is CarbonFree almost any the from late units. is And proceeds. sold generating $XX slightly had million than million shares standard $XX cash in XXXX less that of lithium X.X million. that we we per under Recall in accumulated share,

accumulated carryforwards Also tax $XXX a United of offset can reminder, as approximately States income. we future million that loss in taxable the

$XXX operating our profitability carryforwards. cash a In income addition international carryforwards very state net flow. we also conversion the to tax net we become will significant million improve carryforwards loss have and federal income to to continue as loss tax of important some of loss allowing higher This

In These lithium and taxes. bromine income XXXX, investments carry profits taxes paid pre-tax we the also and U.S. will income income of overseas Arkansas future. generated for $XX our as valuable we forwards over tax to million look us loss be in but from no

that upon to on of work focused last we night. mentioned that and resources other press now spend like I we issued of release been significant minutes have amount internal external been accomplished. have a some that using Brady the few the a

study. is various a based investor very limited no we one resource want assess to imminent but amount aim and are sampling, that is We on process our our made. an be them transparent very significant there announced base is list that assume and on completed the potential gates. to list had fully acreage. I of assets. based go sure taking is reasonably bromine that resource our We inferred measure are inferred through be understands methodical previously And to as be information. limited we process estimated on this and We'll to We investments Arkansas

of inferred publicly not data geological than to We well scope that well XXXX, would significant some assumptions area data basis to allowed Previous on is resource. assess the from points, test about assets, further this reasonable available. that and in Sample make we and a data the capture investment surrounding allow drilled might other to simply incremental for include study. maps this an expenditures of the decisions make any us resource size

confidently shape, the and One size reported. and quality, be step resource inferred resource an grade contiguity up can from is more indicator study an or quantity,

viability. drilling applied. that to which a work. of our well and planning characteristics factors a a in stage, be can the this modeling we highest next and Mining are competence study economic give inferred analysis from resource website party geological knowledge third established At a well yesterday the from The reliable production resource. with We this is and step front second a device on represents of detailed and firm. to Then done, stage. and analysis, level can the is resource economic did technical from competently we detailed to we estimate published have get are reservoir Economic the more end exploration the engineering more engineering resource major

economics The contained report and that economics will no in certainty are be the preliminary there the realized. is

test the invest inclusive second with that and of mentioned an resource, further with degree all that confidence us to at However, incremental arrive was and next economic the to approximately assessments. the $X stages outcome stage, just greater gives I data each that a confidence, the million get points. it well of such Note estimated to each

To significant of resources to that do them reserves to resources us. to available To upgraded are exploration legally work resources whether high amount a order is commercialize inferred Inferred of can move engineering we of mineral level A resource work take a completed have economic demonstrate to determine economically to uncertainty all of they need proving the move of have to competence be Inferred the quantities geological considered this resources further resources required resources. must reserves, in or assessment minerals now mineral their higher mineral lowest and existence category. mineral additional commercialized. successfully. be beyond from be can as to and we can to whether degree to from

reserve non-geological also factors, feasibility a The detail difference account processing which comes environmental takes analysis. bromine. This include factors. a and study, and include economic the additional and as These a such planning, resource extracting brine to down into technical which between the design, engineering includes information

the pop-up extraction is can in Our finest justified. economic reserve be

Our proven economic reserve defined extraction as is is when justified.

to of study. an From inferred that step The points move confidence a we successfully if to doing Albemarle next as to have are likely or been can exactly no has proceed from many technologies we in after. to we're Lanxess data we what process incremental gather can feasibility This to and accomplish a what indicated have economic when complete practice months. gives in evaluating then view, take we knowledge developed to us that the is that and wells, to confidence Our a a are be more new we here are to forward. And fact will what with investment a years, decision and for and need and reminder, from plant. several point an successful pipelines processing make processes move and project

the the resource the of inject of firm we cost and completed bromine $XXX million $XX build about brine could the an facility the allow The approximately processing. million of the facility estimated upsize tail processing us leftover pipelines or to brine, in estimated the contingencies $XX and for a inclusive that brine of higher construct engineering work study be potential volumes future field to bromine of with million of of inclusive the to wealth

wells lithium entailed extract production and groundwork pipelines in we used for in and be to in future. production. leverage includes move that future identified well million brine to and can the as can the that be the Investments investment million believe contingencies. the lay future, significant what increase also $XX as the earlier, mentioned $XXX lithium Brady an as And pipelines. Thus We for

our The has as release mentioned a in bromine multipurpose press focus. we plan

agreement the an relatively first that The is constant. to amount effective market bromine available exceeds available long and demand expected us term agreement. from of to our to above in step TETRA available offshore address in volume growth experiencing to prices remain cost multiyear commodity volumes currently the gas under an already increase TETRA supply oil assuming increase term the long

storage, be The bromide TETRA customers address may demand are to operations. ramping emerging pure up battery significant second in zinc successful based their which for is for

is to producing production have TETRA's by the fourth on our longer of third market open go. purchases of dependence bromine objective final still and to the life several costs. And to purchase supply bromine reduce control current years and beyond lower agreement, potentially own The party will materially we third and chain the for be term multiyear our

that we we decision with study resources to reserves. in indicated to to engaged study completing an from a banking investment us should potentially identify partners mentioned firm We the resource move strategic also proceed potential to make have feasibility after help

to reach someone decision this be we it's At to will on work out decision based on investment. to not us proceed we identify for based next we TETRA investors. a to phase our believe to point, The and move the for of to The made economics only appropriate attractive in the analysis with whether this have identify look with structure partners potential potential partners. partner with preliminary

Given forward. we identifying put required TETRA's investment the will not best believe much and leverage potential partners the of balance be realizing the sheet. We will size strategic path too on

We the opportunities Energy also for for in of and bromine loans preliminary grants our are Department project. discussing with discussions

participating The webcast. Tuesday like presentation making to final item one the add be be Scotia that Weil at I is that a and on ones next hosting afternoon Conference Howard we'll will Tuesday,

me bromine financial or posted of Again, release issued like additional these the to The to and supporting you all filed XX-k further. please our to we metrics. encourage that and items operational Brady. and for we like I everyone any call Please would reach you'd website the if details yesterday. discuss yesterday we to to news participate, out that me report If project our read

it closing to back turn will Brady over I comments. for

Brady Murphy

you, only we've Thank our base recap well, XXXX very earnings business in To did our in to business Elijio. also our made base Not expand but years. investments significant coming perform the

quarters, advanced in as fluids the at several technology nearly Over We've remained the TETRA of Sandstorm utilization. of also very invested as expansion. doubled business completion a we've international our cyclone which last well our deployment EPS of fleet high markets

capacity invested Mexico deepwater of in And increasing boost our to Gulf have to activity. we the support

already While upside contributing earnings. Neptune meaningful activities with remains increased to projects deepwater due offering. Significant offshore CS our very

That generation growth XXXX. excited flow strong expect and and As XXXX. evaluating committed achieve cash continue to margin drive meaningful to coupled Arkansas we'll over cash generation 'XX Elijio in resource, mentioned, expansion we brine on focus with to fully our to as and and appropriate. updates We're communicate the

we'll open up questions. that, to With

Operator

Thank you.

and ahead. We session. question Malloy go question Johnson answer Instructions] will Our first Rice. begin the from Please [Operator Martin now comes with

Martin Malloy

morning. Good

Brady Murphy

morning. Good

Martin Malloy

Could Good and morning. morning. to here I the product? activity market fluids want certainly to you on. completion a Neptune going I about want there's as you visibility ask inflection with maybe the maybe the the offshore on ask talk particular seems point in and talk good like pipeline and about and customers

Brady Murphy

mentioned, Gulf UK the as covered performed Yes. Mexico of job. both we in Martin Neptune job Norway. first So previously Neptune we We've our and in

in 'XX think in have the and we the I opposed I plan to lumpiness repetitive We more And We that second have our And those see this North quarter. that North projects The has our we that, get engaged won't we've Norway to may Neptune it's as get Sea. end been Sea in in that repetitive projects our the four uptick forward we another objective our more past, expect with where be in are opportunities we beyond. executing we're some on come very the getting meaningful project those these to year. likely the see think and the business, Mexico, a before larger we're Gulf some traction jobs the business. to with really, projects. into until But pipelines, projects, obviously, certainly of seen in of customers more in much

Martin Malloy

Can the want that you. assuming flow throughput ramp to ability your up required? able and you they're CapEx about that government ask pure funding looking for. to flow. customers And your and ramp second to question, maybe increase talk ability get and are And my additional thank your about your any would capacity Great, to be

Brady Murphy

Yes.

production Memphis need capital through ramp to production of very facility. our PureFlow ability we Our West little at Memphis West our facility to no up

current the customers We we're have really that capacity they issue plenty up based in as bromine, potential success, Arkansas it successful, of ramping bromine for why if project dramatically of at and the levels have The Arkansas the plant. of for to timing as is our which opportunities reasons are on of up energy carefully the ramp project demand were meaningful you agreement our that supply longer our at impact if there, relates customers [careful] storage, the success one are demand it and pretty looking so is noted our successful term the to Pureflow market. that because the will a are exceed

Martin Malloy

Great, thank you. I'll turn it back.

Operator

The Gengaro next Stephen Please ahead. with question go from comes Stifel.

Stephen Gengaro

a everybody. pardon things because hotel. of noise for Thanks. a Two me. Morning. hear Good lobby And I'm if in morning, you background

first we of So think North the to be in started flowback on top American given addition in quarter I'm think was about about And right I as a as the sort plateauing And going good that of we if business Was was anything sequential quarter about I in think there about I When line. forward. kind about obviously that, in I activity maybe sorry contemplating of that. XXXX? quarter the the to water performance the the should progression think we and should how very now?

Brady Murphy

the margins, And I business take you Yes and typically like market. you to that, we back difficult year. you in significant some to of the little mix on your as go will like efficient increasing mentioned dropped us, bit first. quarter, see with grow for we margins as well but of rebound our some frankly, up be achieved that for caught fourth Steven business. when to QX forward in on costs, pace we as the we was this be quite a full XXXX growth would and water it I'd flow Yes. beyond back And where us with a issue that in fully cover growth the exceeded slightly we've it's to had the a in

the the saw. we activity on second you half I think expectation, build and margins would our from that for the margin water business, a flow of

pretty So growth third a well as years about from that additional second get deployed online we the is that, EPS as full at one in the as of that from good particularly as getting we the feel quarter Argentina, the contribution as and margins of quarter. of well third international, two start we have end due to come

So through in the we our of we well of strong, expanding grow back investments there's positioned in take business remain feel come fluid international But in have more Probably to extremely from year also XXXX we when in market but based XXXX fully a full of to the expect we to side, can completion origins we advantage get and but and little the market always side completion off the the lumpiness QX. this them. go that bit fluid larger the contributions that go as then XXXX. made projects as

to our very ramp. nicely, quarter the just exceptional getting That back XXX% recovered I to we we to in ramp quarter plan would QX note. disruption back our to to there's due not way second TCE second that time are supply nothing for that on QX chemicals has chain And that business in We relative do business. had. with our our the yet to European typical our up well about But

Stephen Gengaro

ballpark? things. mean target you. target Thank two pretty reasonable? for EBITDA That's not One then the straightforward. target And your that's think the Do in XXX streets the you other think. 'XX I million in You is

Elijio Serrano

providing gas refrain year factors of unpredictable, sorry, such that we're there's We is that recent around to as the drop there. move the still full it guidance. too believe refrain going in out I'm from to economic many providing going from We're that price

won't we commenting year guidance. on So full be

Stephen Gengaro

the and and have and for XX couple of right it's down about a on when exciting earnings road? Where in the opportunities, years we're XXXX. things down your the Okay, one and now. of we thanks Elijio how think beginning you you? really what company? do would do -- envision If you two for you key going think obviously, months, are sitting see then of you What drivers the do TETRA Like biggest

Brady Murphy

Yes.

mean, two segments. pleased I So current the of business with we're very position I think our

our water activity a growth opportunities reuse flowback and and particularly the and some, have even desalination, water may still plateaued think with extraction. considerable we business beneficial frac though on our I produced mineral have side

we're fluid And whole the to a leadership think a but have stages of I strong market. I in is I are side, whether space in really there. a we said, we it's that's And really from that be no XX our completion about actually ability today. offshore that opportunities we benefiting feel think determined, think market remaining one months, it's our the position good whether early new be good from the lead XX to On that months as to that effort. will benefit

cadence, will Neptune be our projects think time. that period higher I of certainly a hitting with in

will Arkansas met to will with that, we've have the company. be that we criteria that that listed we're And fully changing with the I'm project And be will that project, forward somewhat move if evaluated. and hopeful successful projects our game approved, which for

Stephen Gengaro

Thank back get in line. you. I'll

Operator

Next with ahead. Moore EF Hutton. Please question comes Tim go from

Tim Moore

this chloride drain see the working for maybe we that assessment much up. nice preliminary cash to flow more have My on And won't Latin you But first American or bit projects. year little build generation last supply should the as could you as expenditures capital you how bromine possibility question free about a it think detailed Elijio, project. capital calcium could have was economic Thanks. the

flow wondering takes? the realm kind XX all the Just of free of in puts possibility given cash is and million

Elijio Serrano

be So to 'XX expect 'XX. we EBITDA above

versus expect capital be We 'XX. 'XX to lower expenditures

like pleased happen. will end activity, don't in we think like we be spike at We the saw going end yearend of XXXX, to to While a that's see the of 'XX.

best think case, worst we working will be neutral, case. So positive capital

XXXX. strongly we So we cash free in be positive that expect will flow

Tim Moore

lower volume was to the set your you reported of compared proficient compared apply. could more. to it your Can a for after bromine after see us mean, talking potential nice well, done, you be like of XX% a And cost helpful. bromine project's much and I supply long It sense to your that the to XX% how now. year we was it's That's savings. maybe any don't rough out XX% terms Yes. operating I project the know, give

Brady Murphy

tell economic Yes not that. competitive specific in purchase we successful. for included can on not project bromine But on details we're we're reasons, specifics we're assessment Tim. if our the the or you what from of that We giving the profitability prices -- Hopefully, the pay. costs be giving information that could financial

Tim Moore

heard stage maybe I had maybe to million did year, expect spend they to I earlier. of and exploration kind pre-development this I your any I has [indiscernible] misunderstood more last of Understood. X million for your you drilling that second what try. a could cost year. be But believe sense comments X.X were mentioned, and

Elijio Serrano

our that in $X.X pre probably to to run some kick our that an $X million we're for this efforts other range. additional million budget year study, off to into So for year, full feasibility this that's potentially drill for But to a going have going engineering well, is some accounted we plan exploration we consultant.

indicated indicated But to to one an get get get intention we could to be well there. well hopeful get really resource that that be that an ensure plan have will that got may finally there we always to well, enough And we're is Our to another for our to expectations. until us But that's that. report. results get We've the and we drill information report. resource

Tim Moore

new sales on automated figure? material for how's those drill That's do curious I’m more summer? And Do kick color. helpful. that going when in out could you maybe they think be that and spring just technology or Thanks

Elijio Serrano

Yes. we we think into contracts We we'll actually discussions. putting capital be term, with long regard. the we have to pay do or there. in going associated that's in we And an have a capital ongoing for point, are lot in additional take going of term we're long But discussions several probably unit. at get We, that those interest unit term before because to But are that with area a ensuring start this commitments operators only for of we're that it.

Tim Moore

produce update few last part question. helpful. my That's I've a also I'm pilot. there review things, lastly, approval it doing timing possible regulatory a got on learned and and water. about the question the agencies And Is on desalination you've like always just and curious any that sounds this. two is then then

if you that wondering that any efficiency? pretreatment, sizes you on refine do can better membrane tiny Just showing for are the or elaborate tweaks

Brady Murphy

Right.

for those operator technology we our process seen the confident requirements we before will the is very We've requirements, produced is the the water to it's our that can go meet So a have and but a desalination regulatory pilot The get each permits project own with apparent on our on in the going is that regulatory have the to that deploy produced for operator process. unit to of to we projects. their with water each feel project. side, going project work permitting through to

upgrades technologies, stage to term the in this extremely take case, agreements it's as some the [indiscernible] That's goes or the have we're both negotiated plant and design to we pretreatment with high the kind well, membrane but critical we of worthiness to performed performed term right before also process. [indiscernible] the on now the KMS, long far the As pilot well, And ready pretty that's long do would a be that field primarily plan. got itself, we've whether that pre-treatment. to the performing

Tim Moore

That that's thanks. for my progressing know, seems like to Good That's questions. it well.

Brady Murphy

Thanks, Tim.

Operator

Hoh question Please next Your from ahead. ISI. Evercore go with comes Samantha

Samantha Hoh

Hey, water produce my been little wanted to initiative. but this down answered, so of questions a on most bit I drill more guys,

scale, technology I'm their like do as large that technology? as permit for about need out have lease needs thinking mentioned new Are their more to operator you're own start how deploy of with similar wondering how you going just partner that, deploy kind model own you projects. you of to a up roll producer do each taking sandstorm terms you're this start that to you you So where initiative? it. you in to Or as the to

Brady Murphy

Yes. Samantha, good morning.

I So, specific to operator. to each be going think, very project, that is

year or day, barrels again, type a smallish more. will going day of XX potentially this you're from and a potentially a which XXX,XXX up a year, XX, project. see think range XX,XXX be XX a to plan barrel I But is to projects

costs the the the a the capital agreement. on of that the fund we going the and different. fund based to for of so see Samantha, projects and each to case very basis Whether operators how on capital with kind them that partnership associated we're going opportunity will are those And be will case customers we or they're take by if smaller,

Samantha Hoh

gas your uncertainty you the lot activity. kind that like to basin? side mostly around where some easy there that just of U.S. and fleet oily Okay. of out land kind And like, of is for gas I'm of wondering move hoses still with isn't sandstone pretty to there's then mentioned an a exposure on

Brady Murphy

Yes.

Marcellus. strong So has business. we Water with a and Flowback do time, in long been the business have a a TETRA a there good operation

changes something an demand We our have we're news sandstorms it's it's is in very all whether or yet. on. are high flowback assets, for that not all seen the any The or meaningful eye keep results water need Permian But going of or far, market warrant good strong to change about positions. material assets South of again, would not those we moving Qcon that or but where if concerned all we to, have type at movement. any haven't I'm so we Texas, that seen our mid

in We don't presence big a Haynesville. have the

outside be, Marcellus of we'll great we do but the shape. think something market see other back, in be that, we of on plenty we exposure have if less that So we'll

Samantha Hoh

provide a margin then you if provide you side, of the kind your deepwater depending rigs, of the any guys if to to markets deepwater trends fluid was the us? how type based like of, and more on like for you offshore of share mix. example, like then data squeeze fluids profitability, that for on the wondering amongst on could the been, guys three And fluid different like Okay, I'm like of share completion pie you the view so like I in is had type I market similar kind similar do the apply you chart, sort for business? just the one on it example? Can for revenue a in. curious breakout like

Brady Murphy

water XX% for have the press example, of yesterday we value our think I Gulf an estimate as fluids deepwater have what release of contain a of North about overall, that That If roughly typically Brazil gave the less a we in high and be Gulf market so have we strong so we deepwater example very XX% little markets, value we position high think a which what be fluids, of an share And That a our completion call Samantha completion team deep helpful. Yes. fluid. deepwater. our a A we require the we Sea in would deepwater. would be wells with that's bromine would Mexico completion in Mexico call deepwater. but we estimates business. bromine other based

On not sure our correctly. details the the the family question understood I the If margin breakdown question? I'm breakdown, would share Was side, we of of a products. that

Samantha Hoh

much. so Thanks helpful. super that's No,

Brady Murphy

Okay.

Operator

Johnson Rice. from with a Please The Martin up follow ahead. is next question Malloy go

Martin Malloy

report solutions from chloride follow these developing up made terms facilities. respect Anything for CarbonFree. to for calcium the industrial potential of there Thank I announcement demand on you they just one in that saw of collaborating projects? the with for to with BP type had

Brady Murphy

with stay carefully a the their bit And announcement look investors CarbonFree saw been for time quite I very one we you actually as we any with CFO is in their of know BP And well. of new CarbonFree. the they in our touch as have know CarbonFree deployments update a the We some had with working from your to engage continue side? Yes. for plants.

Elijio Serrano

program. any participate is technology. we with we them. And a the any believe plant, Yes, next still pilot from of further them speaking, then to chloride from of to announcement whether their CarbonFree capital, impact. with once is their our secure year progress endorsement We minimum BP is continues the to to proper have that sales dialogue with bit significant that get But calcium stage, their a so significant with their out a that before technology. of they them step make launch think Clearly quite expect they to them the practically design

Martin Malloy

Thank you.

Operator

Again, turn [Operator to conference closing remarks. concludes Instructions] Mr. to over any the session. This like our I question-and-answer would Murphy for back

Brady Murphy

our Thank you your you. Thank on call. call. our earnings for That very us QX joining much concludes

Operator

you for attending has presentation. today’s now concluded. conference The Thank

You may all now disconnect.

TETRA (TTI) 28 Feb 232022 Q4 Earnings call transcript