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Prices for oil and natural gas are subject to large fluctuations in response to relatively minor changes in the supply of and demand for oil and natural gas, market uncertainty, and a variety of other economic factors that are beyond our control.
−Removed: Although oil prices steadily rose during 2021 through early 2022, they fell slightly during 2023.
−Removed: West Texas Intermediate oil prices averaged $68.14, $94.90, and $77.58 per barrel during 2021, 2022, and 2023, respectively.
+Added: For example, West Texas Intermediate oil prices averaged $94.90, $77.58, and $76.63 per barrel during 2022, 2023, and 2024, respectively.
Over this same period, U.S.
natural gas prices have also been volatile, with the Henry Hub price averaging $6.45, $2.53, and $2.15 per MMBtu during 2022, 2023, and 2024, respectively.
−Removed: The prolonged volatility and low levels of oil and natural gas prices and supply and demand imbalances generate depressed levels of exploration, development, and production activity.
−Removed: If oil and natural gas prices return to levels at or below those experienced during 2020 and 2021 and supply and demand imbalances persist, there would be a material adverse effect on our business, consolidated results of operations, and consolidated financial condition.
+Added: Prolonged volatility and low levels of oil and natural gas prices and supply and demand imbalances generate depressed levels of exploration, development, and production activity.
+Added: If oil and natural gas prices decline significantly and supply and demand imbalances persist, there would be a material adverse effect on our business, consolidated results of operations, and consolidated financial condition.
Should current market conditions worsen for an extended period of time, we may be required to record additional asset impairments.
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the levels of oil production in the U.S.;
−Removed: and by other non-OPEC countries;
oil refining capacity and shifts in end-customer preferences toward fuel efficiency and the use of natural gas;
2 unchanged sentences
We encounter, and expect to continue to encounter, intense competition in the sale of our products and services.
−Removed: We compete with numerous companies in each of our operating segments, many of which have substantially greater financial and other resources than we have.
+Added: We compete with numerous companies in each of our operating segments, many of which have substantially greater financial and other resources than us.
Certain of our competitors have lower standards of quality, and offer equipment and services at lower prices than we do.
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Other factors affecting our operating results and activity levels include oil and natural gas industry spending levels for exploration, completion, production, development, and acquisition activities, and impairments of long-lived assets.
−Removed: Customer consolidation may also lead to reductions in capital spending that could have a material adverse effect on our business.
+Added: Customer consolidation may also lead to reductions in capital spending that could have an adverse effect on our business.
In addition, Completion Fluids & Products Division profitability in future periods will continue to be affected by the mix of its products and services, including the timing of TETRA CS Neptune completion fluid projects, which are also dependent upon the success of customer offshore exploration and drilling efforts.
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Adverse changes in any of these other factors may have a material adverse effect on our revenues and profitability.
−Removed: In addition, the United States inflation rate increased in 2021, 2022 and much of 2023.
−Removed: These inflationary pressures have resulted and may in the future result in increases to the costs of our goods, services and labor, which in turn has caused and may cause our capital expenditures and operating costs to rise.
+Added: In addition, the United States has experienced higher inflation in recent years which has resulted and may in the future result in increases to the costs of our goods, services and labor, and in turn has caused and may cause our capital expenditures and operating costs to rise.
To the extent elevated inflation remains, we may experience additional cost increases for our operations, including services, labor costs and equipment if our operating activity increases.
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Over time, the fair value of these investments may fluctuate significantly causing volatility in our financial results.
−Removed: As of December 31, 2023, we hold approximately 3.7% of the outstanding CSI Compressco common units, which had a fair value of $8.5 million.
−Removed: The value of our investment in CSI Compressco may be adversely affected by negative changes in its results of operations, cash flows and financial position, which may occur as a result of the many risks attendant with operating in the compression services industry.
−Removed: In addition, on December 19, 2023, CSI Compressco announced that it had entered into an agreement to be acquired by Kodiak Gas Services, Inc.
−Removed: (“Kodiak”) with Kodiak surviving the merger (the “Kodiak Transaction”).
−Removed: If the Kodiak Transaction closes, our common units in CSI Compressco will be exchanged for Kodiak common stock and the value of our investment in the go-forward company may be adversely affected by negative changes to Kodiak’s results of operations, cash flows and financial position.
−Removed: We are party to agreements in which Standard Lithium has the right to explore, produce and extract Lithium in our Arkansas leases as well as additional potential resources in the Mojave region of California.
−Removed: The company receives cash and stock of Standard Lithium under the terms of the arrangements.
−Removed: If we elect to hold Standard Lithium stock received under these agreements, our operating results could be significantly affected by fluctuations in the market value of Standard Lithium stock.
−Removed: As of December 31, 2023, we also hold an investment in a convertible note issued by CarbonFree valued at approximately $6.9 million.
−Removed: This note will be subject to fair value measurement adjustments which will affect our financial results and there can be no assurance that it will ultimately be repaid or converted into equity of CarbonFree.
+Added: As of December 31, 2024, we held investments in Kodiak Gas Services, Inc.
+Added: (“Kodiak”) and Standard Lithium, which had fair values of $18.4 million and $1.2 million, respectively.
+Added: Our operating results could be
+Added: significantly affected by fluctuations in the market value of these investments.
+Added: In January 2025, we sold our Kodiak shares for proceeds of $19.0 million, net of transaction and broker fees.
+Added: The value of our remaining investments may be adversely affected by negative changes in Standard Lithium’s results of operations, cash flows and financial position.
+Added: As of December 31, 2024, we also held investments valued at approximately $8.6 million in a convertible note, common units and preferred units issued by two privately-held companies.
+Added: These convertible notes, common units and preferred units are not publicly traded and may not be offered, sold, transferred or pledged until such units are registered pursuant to an effective registration statement or pursuant to an exemption from registration.
+Added: These investments will be subject to fair value measurement adjustments which will affect our financial results and there can be no assurance that the convertible notes will ultimately be repaid or converted in equity of the issuers.
Changes in the economic environment have resulted, and could further result, in significant impairments of certain of our long-lived assets.
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There are several raw materials for which there are only a limited number of suppliers or a single supplier.
+Added: To mitigate potential supply constraints, we enter into supply agreements with particular suppliers.
For example, we are currently required to purchase all of our requirements of elemental bromine, up to a certain specified maximum and subject to a specified annual minimum, from LANXESS under a long-term supply agreement.
−Removed: To mitigate potential supply constraints, we enter into supply agreements with particular suppliers, including LANXESS.
We also evaluate alternative sources of supply to avoid reliance on limited or sole-source suppliers when possible.
Although we have long-term supply agreements with LANXESS, there is no assurance that we will have an adequate supply of elemental bromine or the other raw materials required for all of our CBF opportunities, or that such raw materials will be available at reasonable prices.
−Removed: Economic sanctions and other regulations imposed by the United States and other international countries as a result of the conflict involving Russia and Ukraine, Israel and
−Removed: Gaza region, hostilities in the Middle East, or maritime piracy attacks may disrupt supplies or affect the prices of certain raw materials.
+Added: Economic sanctions and other regulations imposed by the United States and other international countries as a result of the conflict involving Russia and Ukraine, Israel and Gaza region, hostilities in the Middle East, or maritime piracy attacks may disrupt supplies or affect the prices of certain raw materials.
Should the conflict in Ukraine or other international locations further escalate, it is difficult to anticipate the extent to which current or future sanctions could increase our costs, disrupt our supplies, reduce our sales or otherwise affect our operations.
+Added: Additionally, new or increased tariffs could impact raw material prices and the cost of component parts.
If we are unable to acquire these raw materials at reasonable prices, or at all, for a prolonged period, our Completion Fluids & Products Division business could be materially and adversely affected.
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New drilling, completion, and production technologies and equipment are constantly evolving.
−Removed: If we are unable to adapt to new advances in technology or replace older assets with new assets, we are at risk of losing customers and market share.
+Added: If we are unable to adapt to new advances in technology or replace older assets with new assets, we are at risk of losing
+Added: customers and market share.
Certain equipment, such as a portion of our production testing equipment fleet, may be inadequate to meet the needs of our customers in certain markets.
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Due to the unique nature of many of these assets, finding a suitable or acceptable replacement may be difficult and/or cost prohibitive.
−Removed: The replacement or enhancement of these assets over the next several years may be necessary in order for us to effectively compete in the current marketplace.
+Added: The replacement or enhancement of these assets over the next several years may be necessary for us to effectively compete in the current marketplace.
Our operations involve significant operating risks and insurance coverage may not be available or cost-effective.
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We may not be able to economically extract lithium or bromine from the leased acreage in our Arkansas brine leases.
−Removed: Our Arkansas brine leases currently contain inferred, indicated and measured resources of lithium and bromine, and we may never convert any of these resources to proven mineral reserves on these properties, or enough of them to justify the decision to engage in the extraction of lithium and/or bromine.
−Removed: While we continue to evaluate the next steps regarding the potential development of our brine leases, we have only very recently completed a technical resources report for our Evergreen Brine Unit, and we are not currently able to determine the economic viability of the extraction of the lithium and bromine from the leased acreage.
−Removed: In addition, the extraction of lithium and bromine from these brine leases will likely require a significant amount of time and capital, which we are not able to estimate at this time and which may not be available to us on acceptable terms or at all.
+Added: In addition to proven bromine reserves, our Arkansas brine leases currently contain probable bromine reserves and inferred, indicated and measured resources of lithium and bromine, and we may never convert any of these resources to proven mineral reserves on these properties, or enough of them to justify the decision to engage in the extraction of lithium and/or bromine.
There can be no assurance that any future exploration efforts on these properties will be successful.
−Removed: Prior to producing lithium and bromine from the Evergreen Brine Unit, we must complete a lithium FEED study, a preliminary economic assessment for our lithium acreage, a pre-feasibility and/or feasibility studies for both our bromine and lithium acreage, validate the lithium technologies used, as well as finalize any contractual agreements with our joint venture partner.
+Added: While we continue to evaluate the next steps regarding the potential development of our brine leases, we have only very recently completed a definitive feasibility study with respect to bromine and an updated technical resources report for our Evergreen Brine Unit, and we are not currently able to determine the economic viability of the extraction of the lithium and bromine from the leased acreage.
+Added: In addition, the extraction of lithium and bromine from these brine leases will likely require a significant amount of time and capital, which may exceed current estimates and which may not be available to us on acceptable terms or at all.
+Added: In August 2024, we published a definitive feasibility study for the production of bromine from our Evergreen Unit.
+Added: Prior to producing lithium and bromine from the Evergreen Brine Unit, we must complete a lithium FEED study and a feasibility study for our lithium acreage, validate the lithium technologies used, coordinate with the local utility co-op for the construction of power infrastructure to supply electricity to our plant site, complete detailed engineering for a processing facility, obtain permits for our extraction activities which could be subject to delays or onerous conditions, as well as finalize any contractual agreements with our potential joint venture partner, Saltwerx.
+Added: We and Saltwerx continue to evaluate the potential development of and the negotiation of the joint venture for the Evergreen Brine Unit and are continuing to advance the engineering studies required to more precisely define the lithium project economics.
+Added: Unless and until we finalize any contractual agreements with Saltwerx, including a joint venture agreement, our relationship with Saltwerx will be governed by the MOU and the Brine Unit Operating Agreement approved by the Arkansas Oil and Gas Commission.
+Added: Properties—Bromine and Lithium Resources” for more information regarding the MOU.
As a result of these uncertainties, no assurance can be given that any future exploration programs will result in the discovery of commercially viable mineral resources or reserves.
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Our future success may depend on our ability to effectively execute on our low carbon energy initiatives.
−Removed: This strategy depends on our ability to effectively identify, develop, and scale new technologies, expand application of our global infrastructure and chemistry expertise and on the economic viability of the extraction of lithium and bromine from the leased acreage.
−Removed: Furthermore, execution of our low carbon initiatives are subject to a number of permitting, real estate, and project development risks, which could delay, limit, or even prevent the successful execution of these initiatives.
+Added: This strategy depends on our ability to effectively identify, develop, and scale new technologies, expand application of our global infrastructure and chemistry expertise and on the economic viability of the extraction of lithium and bromine from our Arkansas brine leases.
+Added: Furthermore, execution of our low carbon initiatives are subject to a number of permitting, real estate, and project development risks, which could delay, limit, or even prevent the
+Added: successful execution of these initiatives.
Moreover, we cannot guarantee that the low carbon initiatives we may identify will meet the expectations of our various stakeholders.
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For example, the exploration, development and extraction of brine and lithium from our Arkansas brine leases will likely require significant time and capital, and there is no guarantee of a return from these operations.
−Removed: Our low carbon energy initiatives may also depend in part on successful development of partnerships with other companies, such as our partnership and investment in CarbonFree and our MOU and potential joint venture partnership with Saltwerx, and such partners’ execution of their own respective projects and business strategies.
+Added: Our low carbon energy initiatives may also depend in part on successful development of partnerships with other companies, such as our partnership and investments in privately-held companies and our MOU and potential joint venture partnership with Saltwerx, and such partners’ execution of their own respective projects and business strategies.
+Added: Moreover, successful execution of these initiatives may turn on the timely issuance of permits or other authorizations for activities, which we cannot control.
If we, or the projects or partners we invest in, fail to execute our low carbon energy initiatives as planned, or if execution of such initiatives requires more time and capital than expected, demand for our technologies, services and mineral assets and consequently, our business, results of operations and financial condition could be adversely affected.
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To the extent severe drought or other weather-related conditions prevent our customers from obtaining needed water, frac water operations may not be possible and our Water & Flowback Services Division business may be negatively affected.
−Removed: Further, a portion of our operations is susceptible to adverse weather conditions in the Gulf of Mexico, including hurricanes and other extreme weather conditions.
−Removed: Our 2021 results reflect an estimated unfavorable impact of $3.1 million due to the severe weather conditions during February that shut down fracking activity in several of our key markets and negatively impacted the supply chain for our industrial chemicals operations.
+Added: Further, a portion of our operations is susceptible to adverse weather conditions in the Gulf of America, including hurricanes and other extreme weather conditions.
Even if we do not experience direct damage from storms, we may experience disruptions in our operations, because we are unable to operate or our customers or suppliers may curtail their activities due to damage to their wells, platforms, pipelines, and facilities.
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In recent years, the stock market in general has experienced extreme price and volume fluctuations that have affected the market price for companies in industries similar to ours.
−Removed: Some of these fluctuations have been unrelated to operating performance and are attributable, in part, to outside factors such as general economic conditions, including the impact of the COVID-19 pandemic, the ongoing Russia-Ukraine conflict, conflict in the Israel-Gaza region, continued hostilities in the Middle East, maritime piracy attacks, and fear of a global recession.
+Added: Some of these fluctuations have been unrelated to operating performance and are attributable, in part, to outside factors such as general economic conditions, including the impact of the ongoing Russia-Ukraine conflict, conflict in the Israel-Gaza region, continued hostilities in the Middle East, maritime piracy attacks, and fear of a global recession.
The volatility of our common stock may make it difficult to resell shares of our common stock at attractive prices.
Our long-term debt agreements contain covenants and other provisions that restrict our ability to take certain actions and may limit our ability to operate or grow our business in the future.
−Removed: As of December 31, 2023, our total long-term debt outstanding of $157.5 million consisted of the carrying amount outstanding under our credit agreement (the “Term Credit Agreement”).
−Removed: We also have availability under our Asset-Based Credit Agreement (the “ABL Credit Agreement”), which we entered into in September 2018, and under our revolving credit facility for seasonal working capital needs of subsidiaries in Sweden (“Swedish Credit Facility”), which was entered into in January 2022.
−Removed: On January 12, 2024, the Company entered into a definitive agreement for a $265.0 million credit facility with a maturity of January 2030, consisting of a $190.0 million funded term loan and a $75.0 million delayed-draw term loan (collectively the “New Term Credit Agreement”) that refinanced the Company’s Term Credit Agreement outstanding as of December 31, 2023 and provided capital to advance the Company’s Arkansas bromine processing project.
−Removed: The ABL Credit Agreement contains certain affirmative and negative covenants, including covenants that restrict the ability of TETRA and certain of its subsidiaries to take certain actions including, among other things and subject to certain significant exceptions, (i) incurring debt, (ii) granting liens, (iii) engaging in mergers and other fundamental changes, (iv) making investments, (v) entering into, or amending, transactions with affiliates, (vi) paying dividends and making other restricted payments, (vii) prepaying other indebtedness, and (viii) selling assets.
+Added: As of December 31, 2024, our total long-term debt outstanding of $179.7 million consisted of the carrying amount outstanding under our credit facility.
+Added: Our credit facility matures in January 2030 and consists of a $190.0 million funded term loan and a $75.0 million delayed-draw term loan (collectively the “Term Credit Agreement”).
+Added: We also have availability under our Asset-Based Credit Agreement (the “ABL Credit Agreement”), and under our revolving credit facility for seasonal working capital needs of subsidiaries in Sweden (“Swedish Credit Facility”).
+Added: The Term Credit Agreement contains certain affirmative and negative covenants, including covenants that restrict the ability of the Company and certain of its subsidiaries to take certain actions including, among other things and subject to certain significant exceptions, the incurrence of debt, the granting of liens, engaging in mergers and other fundamental changes, the making of investments, entering into transactions with affiliates, the payment of dividends and other restricted payments, the prepayment of other indebtedness and the sale of assets.
+Added: The Term Credit Agreement also requires the Company to maintain a Leverage Ratio (as defined in the new term loan credit agreement) of not more than 4.0 to 1.0 as of the end of each fiscal quarter and Liquidity (as defined in the New Term Credit Agreement) of not less than $50.0 million at all times.
+Added: The ABL Credit Agreement contains certain affirmative and negative covenants, including covenants that restrict the ability of TETRA and certain of its subsidiaries to take certain actions including, among other things and subject to certain significant exceptions, incurring debt, granting liens, engaging in mergers and other fundamental changes, making investments, entering into, or amending, transactions with affiliates, paying dividends and making other restricted payments, prepaying other indebtedness and selling assets.
The ABL Credit Agreement also contains a provision that may require a fixed charge coverage ratio (as defined in the ABL Credit Agreement) of not less than 1.00 to 1.00 in the event that certain conditions associated with outstanding borrowings and cash availability occur.
−Removed: The New Term Credit Agreement contains certain affirmative and negative covenants, including covenants that restrict the ability of the Company and certain of its subsidiaries to take certain actions including, among other things and subject to certain significant exceptions, the incurrence of debt, the granting of liens, engaging in mergers and other fundamental changes, the making of investments, entering into transactions with affiliates, the payment of dividends and other restricted payments, the prepayment of other indebtedness and the sale of assets.
−Removed: The New Term Credit Agreement also requires the Company to maintain a Leverage Ratio (as defined in the new term loan credit agreement) of not more than 4.0 to 1.0 as of the end of each fiscal quarter and Liquidity (as defined in the New Term Credit Agreement) of not less than $50.0 million at all times.
Our continuing ability to comply with covenants in our Long-Term Debt Agreements depends largely upon our ability to generate adequate earnings and operating cash flow.
2 unchanged sentences
We have adopted a Tax Benefits Preservation Plan (the “Tax Plan”) that is designed to protect our Tax Attributes.
−Removed: As of December 31, 2023, we had federal, state, and foreign net operating loss carryforwards/carrybacks (“NOLs”) equal to approximately $75.8 million, $10.3 million, and $8.9 million, respectively.
−Removed: In those countries and states in which NOLs are subject to an expiration period, our NOLs, if not utilized, will expire at various dates from 2024 through 2043.
+Added: As of December 31, 2024, we had deferred tax assets associated with federal, state, and foreign net operating loss carryforwards/carrybacks (“NOLs”) equal to approximately $72.4 million, $9.0 million, and $7.7 million, respectively.
+Added: In those countries and states in which NOLs are subject to an expiration period, our NOLs, if not utilized, will expire at various dates beginning in 2025 through 2043.
We may be limited in the portion of our NOLs that we can use in the future to offset taxable income for United States, federal, state, and foreign income tax purposes.
−Removed: Utilization of these NOLs depends on many factors, including our future taxable income, which cannot be assured.
−Removed: Under Section 382 (“Section 382”) of the Internal Revenue Code of 1986, as amended (the “Code”), if a corporation experiences an “ownership change,” any NOLs, losses or deductions attributable to a “net unrealized
−Removed: built-in loss” and other tax attributes (“Tax Attributes”) could be substantially limited, and timing of the usage of such Tax Attributes could be substantially delayed.
+Added: Utilization of these NOLs depends on many factors, including our future taxable income, which cannot be assured and our future assessments may be materially different from the current estimate.
+Added: Under Section 382 (“Section 382”) of the Internal Revenue Code of 1986, as amended (the “Code”), if a corporation experiences an “ownership change,” any NOLs, losses or deductions attributable to a “net unrealized built-in loss” and other tax attributes (“Tax Attributes”) could be substantially limited, and timing of the usage of such Tax Attributes could be substantially delayed.
A corporation generally will experience an ownership change if one or more stockholders (or group of stockholders) who are each deemed to own at least 5% of the corporation’s stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a testing period (generally, a rolling three-year period).
1 unchanged sentence
The Board of Directors has adopted the Tax Plan to protect the availability of the Company’s Tax Attributes.
−Removed: The Tax Plan is designed to reduce the likelihood that we experience an ownership change by deterring certain acquisitions of our common stock.
+Added: The Tax Plan is designed to reduce the likelihood that we experience an ownership change by deterring certain
+Added: acquisitions of our common stock.
There can be no assurances, however, that the deterrent mechanism will be effective, and, therefore, such acquisitions may still occur.
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From 2001 to 2012, our former subsidiary, Maritech Resources, Inc.
−Removed: (“Maritech”), acquired, produced, and operated various oil and gas properties in the Gulf of Mexico and eventually sold of the various oil and gas producing properties in numerous transactions to different buyers.
+Added: (“Maritech”), acquired, produced, and operated various oil and gas properties in the Gulf of America and eventually sold the various oil and gas producing properties in numerous transactions to different buyers.
In connection with those sales, the buyers generally assumed the decommissioning liabilities associated with the properties sold (the “Legacy Liabilities”) and generally became the successor operator.
1 unchanged sentence
To the extent that a buyer, or subsequent buyer, of these properties fails to perform the decommissioning work required, Maritech or we may be required to perform operations to satisfy the Legacy Liabilities.
−Removed: Pursuant to a Bonding Agreement entered into as part of the Orinoco transactions (the “Bonding Agreement”), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace the Initial Bonds with other non-revocable performance bonds in the aggregate sum of $47.0 million (collectively, the “Replacement Bonds”).
+Added: In March 2018, pursuant to a series of transactions, Maritech sold the remaining offshore leases held by Maritech to Orinoco Natural Resources, LLC (“Orinoco”) and, immediately thereafter, we sold all equity interest in Maritech to Orinoco.
+Added: Under the Maritech Asset Purchase Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases conveyed to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase Agreement, Orinoco assumed all other liabilities of Maritech, including the Legacy Liabilities and liabilities pertaining to properties still operated by Maritech, subject to limited exceptions unrelated to the decommissioning liabilities.
+Added: Pursuant to a Bonding Agreement entered into as part of the Orinoco transactions (the “Bonding Agreement”), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the Orinoco Lease Liabilities (the “Initial Bonds”) and agreed to replace the Initial Bonds with other non-revocable performance bonds in the aggregate sum of $47.0 million (collectively, the “Replacement Bonds”).
In the event Orinoco does not provide the Replacement Bonds, Orinoco is required to make certain cash escrow payments to us.
−Removed: Significant decommissioning liabilities that were assumed by the buyers of the Maritech properties in these previous sales remain unperformed.
+Added: However, as of the date of this report, the Replacement Bonds have not been received and no cash escrow payments have been made.
+Added: In the event that Orinoco fails to perform, our guarantees may still cover these liabilities.
+Added: Separately, significant decommissioning liabilities that were assumed by the buyers of the Maritech properties in these previous sales remain unperformed.
If these buyers, or any successor owners of the Maritech properties, are unable to satisfy and extinguish their decommissioning liabilities due to bankruptcy or other liquidity issues, the U.S.
Department of the Interior may seek to impose those obligations on Maritech and on us.
−Removed: See Note 11 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements for further discussion of decommissioning liabilities and the Bonding Agreement.
−Removed: The amount of cash necessary to satisfy these obligations could be significant and, and if Maritech or Orinoco is unable to cover deficiency between any bond payment and the decommissioning liability, our financial condition and results of operations may be negatively affected.
−Removed: In March 2018, pursuant to a series of transactions, Maritech sold the remaining offshore leases held by Maritech to Orinoco Natural Resources, LLC (“Orinoco”) and, immediately thereafter, we sold all equity interest in Maritech to Orinoco.
−Removed: Under the Maritech Asset Purchase Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases conveyed to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase Agreement, Orinoco assumed all other liabilities of Maritech, including the Legacy Liabilities and liabilities pertaining to properties still operated by Maritech, subject to limited exceptions unrelated to the decommissioning liabilities.
−Removed: Under the Bonding Agreement, TETRA received non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech.
−Removed: Our guarantees may still cover these liabilities.
−Removed: Orinoco has failed to replace certain bonds required to be maintained to secure the performance of Maritech’s decommissioning liabilities.
−Removed: Further, Maritech and certain other interest owners have received BSEE decommissioning orders, and from time to time we receive demand notices from third parties related to such corporate guarantees.
−Removed: See Note 11 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements for further discussion of status of this bond replacement process.
−Removed: If we become liable for decommissioning liabilities and Maritech or Orinoco is unable to cover any deficiency between any bond payment and the decommissioning liability, our financial condition and results of operations may be negatively affected.
−Removed: Possible changes in the U.S.
−Removed: Department of Interior’s supplemental bonding and financial assurance requirements may increase our risks associated with the decommissioning obligations pertaining to oil and gas properties previously owned by Maritech.
−Removed: Recent and additional anticipated changes to the supplemental bonding and financial assurance program managed by the U.S.
−Removed: Department of the Interior could require all oil and gas owners and operators with infrastructure in the Gulf of Mexico to provide additional supplemental bonds or other acceptable financial assurance for decommissioning liabilities.
−Removed: These changes have the potential to adversely impact the financial condition of lease owners and operators in the Gulf of Mexico and increase the number of such owners and operators seeking bankruptcy protection, given current oil and gas prices.
−Removed: In July 2016, the U.S.
−Removed: Department of the Interior issued a Notice to Lessees and Operators (“2016 NTL”) that strengthened requirements for the posting of additional financial assurance by offshore lease owners and operators to assure that sufficient security is available to satisfy and extinguish decommissioning obligations with respect to offshore wells, platforms, pipelines and other facilities.
−Removed: Although the U.S.
−Removed: Department of the Interior under the Trump Administration ultimately rescinded the 2016 NTL in 2020, the Biden Administration has taken steps to reconsider the changes made by the U.S.
−Removed: Department of the Interior under the Trump Administration.
−Removed: For example, in June 2023, BOEM issued a notice of proposed rulemaking seeking to modify its criteria for determining bonds and financial assurance for offshore oil and gas lessees and other operators, which generally imposes more stringent requirements for waiving supplemental bonding requirements.
−Removed: In August 2023, the public comment period for this proposal was extended, and the rulemaking remains pending.
−Removed: Should the rule be finalized as proposed, or if the Biden Administration were to otherwise re-issue and fully implement guidance or rules analogous to, or more rigorous than, the 2016 NTL, such developments could increase operating costs for lease owners and operators in the Gulf of Mexico and reduce the availability of surety bonds due to the increased demands for such bonds.
−Removed: As a result, there is significant uncertainty surrounding financial assurance obligations for Gulf of Mexico lease owners and operators and for us through the third-party indemnity agreements we have provided for Maritech liabilities to the U.S.
−Removed: Department of the Interior and/or to third parties through our private guarantees.
−Removed: Department of the Interior also recently increased its estimates for decommissioning liabilities in the Gulf of Mexico, causing the potential need for additional supplemental bonding and/or other financial assurances to be dramatically increased.
−Removed: When coupled with the volatile prices of oil and gas, it is difficult to predict the impact of the rule and regulatory changes already promulgated and as may be forthcoming by the U.S.
+Added: The amount of cash necessary to satisfy these obligations could be significant and, if Maritech or Orinoco is unable to cover any deficiency between any bond payment and the decommissioning liability, we may be liable for a portion of the costs and our financial condition and results of operations may be negatively affected.
+Added: For example, Maritech is liable, with other third parties, for certain decommissioning obligations in the Gulf of America.
+Added: While the ultimate outcome of this matter cannot be predicted, we could potentially be liable for an estimated amount in the range of $5.8 million to $19.4 million, depending on the outcome of negotiations and whether other partners or property owners in the chain of title fulfill their respective obligations under their agreements.
+Added: Such estimates are based on information known to us as of the time of this report and are subject to change.
+Added: In addition, Maritech and certain other interest owners have received decommissioning orders from BSEE and could receive additional decommissioning orders in the future.
+Added: Such decommissioning orders received by Maritech and other interest owners relate to asset retirement obligations for certain properties in the Gulf of America.
+Added: From time to time, we also receive demand notices from third parties related to certain corporate guarantees or other arrangements covering such decommissioning liabilities.
+Added: While the ultimate outcome of such matters cannot be predicted at this time, if Maritech or other interest owners default, BSEE or third parties may seek to enforce certain corporate guarantees or third party indemnity agreements against us for a portion of such decommissioning obligations, which may be significant.
+Added: On February 13, 2025, Arena Energy, LLC filed a complaint in U.S.
+Added: District Court for the Southern District of Texas seeking indemnification from us and Maritech for decommissioning costs related to a Maritech oil and gas platform in the Gulf of America.
+Added: We are evaluating the allegations included in the complaint and intend to vigorously defend against the claims brought by Arena Energy, LLC but are presently unable to predict the duration, scope or result of this proceeding.
+Added: See Note 11 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements for further discussion of decommissioning liabilities, the Bonding Agreement, and the process for replacement of the Orinoco bonds.
+Added: From time to time the U.S.
+Added: Department of Interior has sought to impose more stringent supplemental bonding and financial assurance requirements, which may increase our risks associated with the decommissioning obligations pertaining to oil and gas properties previously owned by Maritech.
+Added: There has been substantial uncertainty relating to the supplemental bonding and financial assurance program managed by the U.S.
+Added: Department of the Interior over the past several years.
+Added: Under prior administrations, the U.S.
+Added: Department of Interior has sought to require certain oil and gas owners and operators with infrastructure in the Gulf of America to provide additional supplemental bonds or other acceptable financial assurance for decommissioning liabilities.
+Added: These changes have the potential to adversely impact the financial condition of lease owners and operators in the Gulf of America and increase the number of such owners and operators seeking bankruptcy protection.
+Added: For example, in April 2024, BOEM finalized a rulemaking which modified its criteria for determining bonds and financial assurance for offshore oil and gas lessees and other operators, generally imposing more stringent requirements for waiving supplemental bonding requirements.
+Added: These developments, coupled with recent volatility in the surety market with respect to covering OCS obligations, have the potential to increase operating costs for lease owners and operators in the Gulf of America and reduce the availability of surety bonds due to the increased demands for such bonds.
+Added: Department of the Interior also increased its estimates for decommissioning liabilities in the Gulf of America, causing the potential need for additional supplemental bonding and/or other financial assurances to be dramatically increased.
+Added: When coupled with any volatility with respect to the prices of oil and gas, it is difficult to predict the impact of BOEM’s 2024 rule and regulatory changes already promulgated, and any other changes as may be forthcoming by the U.S.
Department of the Interior relating to financial assurance for decommissioning liabilities.
−Removed: Any revisions to the U.S.
−Removed: Department of the Interior’s supplemental bonding process could result in demands for the posting of increased financial assurances by owners and operators in the Gulf of Mexico, including Maritech, Orinoco and the other entities to whom Maritech divested its Gulf of Mexico assets, but such demands cannot be directly placed on us due to the fact that we are only a former parent company of Maritech and are only a guarantor as opposed to an actual lease owner or operator.
−Removed: This may force lease owners and operators of leases and other infrastructure in the Gulf of Mexico to obtain additional surety bonds or other forms of financial assurance, the costs of which could be significant.
−Removed: Moreover, anticipated changes to the bonding and financial assurance program for the Gulf of Mexico could result in the loss of supplemental bonding waivers for a large number of lease owners and operators of infrastructure in the Gulf of Mexico, which could in turn force these owners and operators to seek additional surety bonds which could exceed the surety bond market’s ability to provide such additional financial assurance.
−Removed: Lease owners and operators who have already leveraged their assets could face difficulty obtaining surety bonds because of concerns the surety may have about the priority of their liens on their collateral as well as the creditworthiness of such lease owners and operators.
−Removed: Consequently, anticipated changes to the bonding and financial assurance program could result in additional lease owners and operators in the Gulf of Mexico initiating bankruptcy proceedings, which in turn could result in the U.S.
−Removed: Department of the Interior seeking to impose decommissioning costs on predecessors in interest and providers of third-party indemnity agreements in the event that the current lease owners and/or operators cannot meet their decommissioning obligations.
−Removed: As a result, this could increase the risk that we may be required to step in and satisfy remaining decommissioning liabilities of Maritech and any buyer of the Maritech properties, including Orinoco, through our third-party indemnity agreements and private guarantees, which obligations could be significant and could adversely affect our business, results of operations, financial condition and cash flows.
+Added: We cannot predict what actions, if any, and on what timing, the new Administration may take with respect to these matters;
+Added: however, the ultimate impact of BOEM’s 2024 rule, and other rulemaking, is presently unclear given a recent Executive Order issued by the Trump Administration.
+Added: Still, any further revisions to the U.S.
+Added: Department of the Interior’s supplemental bonding requirements that increase their stringency could result in demands for the posting of increased financial assurances by owners and operators in the Gulf of America, including Maritech, Orinoco and the other entities to whom Maritech divested its Gulf of America assets, but such demands cannot be directly placed on us due to the fact that we are only a former parent company of Maritech and are only a guarantor as opposed to an actual lease owner or operator.
+Added: This may force lease owners and operators of leases and other infrastructure in the Gulf of America to obtain additional surety bonds or other forms of financial assurance, the costs of which could be significant.
+Added: Moreover, the changes to the bonding and financial assurance program for the Gulf of America (to include loss of supplemental bonding waivers, exceedances of the surety bond market’s ability to meet current demands, and resultant bankruptcies) could increase the risk that we may be required to step in and satisfy remaining decommissioning liabilities of Maritech and any buyer of the Maritech properties, including Orinoco, through our third-party indemnity agreements and private guarantees.
+Added: Such obligations could be significant and could adversely affect our business, results of operations, financial condition and cash flows.
We are exposed to significant credit risks.
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Our ability to collect from our customers could be impacted by volatility in the oil and natural gas price environment and we may face increased credit risks if the price of oil were to fall and remain low for an extended period of time.
−Removed: As discussed in the preceding risk factors, we face the risk of having to satisfy decommissioning liabilities on properties presently or formerly owned by Maritech, including companies that have purchased Maritech properties or are joint owners in properties presently and formerly owned by Maritech and from whom Maritech is entitled to receive payments upon satisfaction of certain decommissioning obligations.
+Added: As discussed in the preceding risk factors, we face the risk of having to satisfy decommissioning liabilities on properties presently or formerly owned by Maritech.
Consequently, we face credit risk associated with the ability of these companies to satisfy their decommissioning liabilities.
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The operations of certain of our subsidiaries are exposed to fluctuations between the U.S.
−Removed: dollar and certain foreign currencies, particularly the euro, the British pound, the Mexican peso, and the Argentinian peso.
+Added: dollar and certain foreign currencies, particularly the euro, the British pound, the Brazilian Real, the Argentinian peso and the Mexican peso.
Our plans to grow our international operations could cause this exposure from fluctuating currencies to increase.
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As of December 31, 2024, we had $190.0 million principal outstanding under our Term Credit Agreement and no balance outstanding under our ABL Credit Agreement.
−Removed: In January 2024, the Company entered into a New Term Credit Agreement that refinanced the Term Credit Agreement outstanding as of December 31, 2023 and provided capital to advance the Company’s Arkansas bromine processing project.
These credit facilities consist of floating rate loans that bear interest at an agreed upon percentage rate spread above the secured overnight financing rate (“SOFR”) or an alternate base rate.
−Removed: Whenever we have amounts outstanding under these facilities, our cash flows and results of operations will be subject to interest rate risk exposure associated with the debt balance outstanding.
+Added: Whenever we have amounts outstanding under our long-term debt agreements and credit facilities, our cash flows and results of operations will be subject to interest rate risk exposure associated with the debt balance outstanding.
We currently are not a party to an interest rate swap contract or other derivative instrument designed to hedge our exposure to interest rate fluctuation risk.
−Removed: Our ABL Credit Agreement is scheduled to mature on May 31, 2025.
−Removed: Our New Term Credit Agreement is scheduled to mature on January 12, 2030.
+Added: Our Term Credit Agreement is scheduled to mature on January 1, 2030 and our ABL Credit Agreement is scheduled to mature on May 13, 2029.
There can be no assurance that financial market conditions or borrowing terms at the times these existing debt agreements are renegotiated will be as favorable as the current terms and interest rates.
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In addition, independent third parties may develop competitive or superior technologies.
−Removed: In addition, the tools, techniques, methodologies, programs, and components we use to provide our services and products may infringe upon or otherwise violate the intellectual property rights of others or be challenged on that basis.
+Added: Additionally, the tools, techniques, methodologies, programs, and components we use to provide our services and products may infringe upon or otherwise violate the intellectual property rights of others or be challenged on that basis.
Regardless of the merits, any such claims generally result in significant legal and other costs, including reputational harm, and may distract management from running our business.
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For example, the EPA has asserted federal regulatory authority under the Safe Drinking Water Act Underground Injection Control program over certain hydraulic fracturing activities involving the use of diesel fuels and published permitting guidance for such activities and issued a final regulation under the Clean Water Act prohibiting discharges to publicly owned treatment works of wastewater from onshore unconventional oil and gas facilities.
−Removed: Additionally, in December 2016, the EPA released its final report on the potential impacts of hydraulic fracturing on drinking water resources, concluding that “water cycle” activities associated with hydraulic fracturing may impact drinking water resources under certain limited circumstances.
Certain environmental and other groups have suggested that additional federal, state, and local laws and regulations may be needed to more closely regulate the hydraulic fracturing process.
Several states have adopted regulations that require operators to disclose the chemical constituents in hydraulic fracturing fluids.
−Removed: We cannot predict whether any federal, state or local laws or regulations will be enacted regarding hydraulic fracturing, and, if so, what actions any such laws or regulations would require or prohibit.
−Removed: Other jurisdictions where our products and services are used may impose similar or more stringent restrictions.
−Removed: If additional levels of regulation or permitting requirements were imposed on oil and gas operators through the adoption of new laws and regulations, the demand for certain of our products and services could be decreased or subject to delays.
+Added: We cannot predict whether any foreign, federal, state or local laws or regulations will be enacted regarding hydraulic fracturing, and, if so, what actions any such laws or regulations would require or prohibit.
+Added: If additional levels of regulation or permitting requirements are imposed on oil and gas operators through the adoption of new laws and regulations, the demand for certain of our products and services could be decreased or subject to delays.
We operate in the U.S.
−Removed: Gulf of Mexico.
+Added: Gulf of America.
At this time, we cannot predict the full impact that other regulatory actions that may be mandated by the federal government may have on our operations or the operations of our customers.
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Regulators are becoming more focused on-air emissions from oil and gas operations, including volatile organic compounds, hazardous air pollutants, and GHGs.
−Removed: In particular, the focus on GHGs and climate change, including incentives to conserve energy or use alternative energy sources, such as those contained in recently passed laws like the Inflation Reduction Act (“IRA 2022”), could have a negative impact on our financial results if such laws, regulations, treaties, or international agreements reduce the worldwide demand for oil and natural gas or otherwise result in reduced economic activity generally.
+Added: In particular, the focus on GHGs and climate change, including incentives to conserve energy or use alternative energy sources, such as those contained in laws like the Inflation Reduction Act (“IRA 2022”), unless amended or otherwise superseded, could have a negative impact on our financial results if such laws, regulations, treaties, or international agreements reduce the worldwide demand for oil and natural gas or otherwise result in reduced economic activity generally.
In addition, such laws, regulations, treaties, or international agreements could result in increased compliance costs, capital spending requirements, or additional operating restrictions for us, which may have a negative impact on our financial results.
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Environmental Protection Agency (“EPA”), including those sources in the onshore petroleum and natural gas production and gathering and boosting source categories.
−Removed: The methane emissions charge would start in calendar year 2024 at $900 per ton of methane, increase to $1,200 in 2025, and be set at $1,500 for 2026 and each year after.
+Added: The methane emissions charge began in calendar year 2024 at $900 per ton of methane, increases to $1,200 in 2025, and will be set at $1,500 for 2026 and each year after.
Calculation of the fee is based on certain thresholds established in the IRA 2022.
While the tax incentives created by the IRA for carbon capture and sequestration may increase demand for some of the services we provide as part of our low carbon solutions business, the methane charge imposed on our oil and natural gas customers could further accelerate the transition of the economy away from the use of fossil fuels towards lower- or zero-carbon emissions alternatives.
−Removed: This could decrease demand for oil and gas and consequently adversely affect the business of our customers, thereby reducing demand for our other services.
+Added: We cannot predict whether, how, or when the incoming Trump administration might take action to revise or repeal the methane emissions charge.
+Added: Additionally, Congress may take actions to repeal or revise the IRA, including with respect to the methane emissions charge, which timing or outcome similarly cannot be predicted.
+Added: To the extent that the methane emissions charge is implemented as originally promulgated, it could decrease demand for oil and gas and consequently adversely affect the business of our customers, thereby reducing demand for our other services.
Our operations, and those of our suppliers and customers, are subject to a series of risks arising from climate change.
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As a result, our operations as well as the operations of our oil and natural gas exploration and production customers and our suppliers are subject to a series of regulatory, political, litigation, and financial risks associated with the production and processing of fossil fuels and emission of GHGs.
−Removed: In the United States, no comprehensive climate change legislation has been implemented at the federal level, though recently passed laws such as the IRA 2022 advance numerous climate-related objectives.
−Removed: President Biden has highlighted addressing climate change as a priority of his administration and has issued several executive orders addressing climate change.
−Removed: Moreover, following the U.S.
−Removed: Supreme Court finding that GHG emissions constitute a pollutant under the CAA, the EPA has adopted regulations that, among other things,
−Removed: establish construction and operating permit reviews for GHG emissions from certain large stationary sources, require the monitoring and annual reporting of GHG emissions from certain petroleum and natural gas system sources in the United States, and together with the DOT, implementing GHG emissions limits on vehicles manufactured for operation in the United States.
−Removed: The regulation of methane from oil and gas facilities has been subject to uncertainty in recent years.
−Removed: In September 2020, the Trump Administration revised prior regulations to rescind certain methane standards and remove the transmission and storage segments from the source category for certain regulations.
−Removed: However, subsequently, the U.S.
−Removed: Congress approved, and President Biden signed into law, a resolution under the Congressional Review Act to repeal the September 2020 revisions, effectively reinstating the prior standards.
−Removed: Additionally, in December 2023, EPA issued a final rule that established more stringent OOOOb new source and OOOOc first-time existing source standards of performance for methane and volatile organic compound emissions for oil and gas facilities.
−Removed: Given the long-term trend toward increasing regulation, further federal GHG regulations of the oil and gas industry remain a significant possibility.
+Added: In the United States, no comprehensive climate change legislation has been implemented at the federal level, though laws such as the IRA 2022 advance numerous climate-related objectives.
+Added: Following the U.S.
+Added: Supreme Court finding that GHG emissions constitute a pollutant under the CAA, the EPA adopted regulations that, among other things, established construction and operating permit reviews for GHG emissions from certain large stationary sources, required the monitoring and annual reporting of GHG emissions from certain petroleum and natural gas system sources in the United States, and together with the DOT, implemented GHG emissions limits on vehicles manufactured for operation in the United States.
+Added: However, from time to time certain administrations have taken actions to repeal or revise such climate-related actions.
+Added: For example, the regulation of methane from oil and gas facilities has been subject to uncertainty in recent years.
+Added: For more information, see our disclosures titled “The Inflation Reduction Act of 2022 could accelerate the transition to a low carbon economy and could impose new costs on our customers’ operations.” Given the long-term trend toward increasing regulation, further federal GHG regulations of the oil and gas industry remain a significant possibility.
For more information, see our disclosures titled “Health, Safety, and Environmental Affairs Regulation” set forth in Item 1 of this Annual Report.
+Added: Moreover, certain international jurisdictions continue to impose more stringent regulations with respect to GHGs, and other stakeholders may pressure us or our customers to take additional action beyond any applicable regulatory requirements.
Separately, various states and groups of states have adopted or are considering adopting legislation, regulation or other regulatory initiatives that are focused on such areas as GHG cap and trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions.
−Removed: At the international level, the United Nations-sponsored "Paris Agreement" requires member states to submit non-binding, individually determined reduction goals known as Nationally Determined Contributions (“NDCs”) every five years after 2020.
−Removed: Following President Biden’s executive order in January 2021, the United States rejoined the Paris Agreement and, in April 2021, established a goal of reducing economy wide net GHG emissions 50-52% below 2005 levels by 2030.
−Removed: Additionally, at the 26th Conference of the Parties (“COP26”) in Glasgow in November 2021, the United States and the European Union jointly announced the launch of a Global Methane Pledge;
−Removed: an initiative committing to a collective goal of reducing global methane emissions by at least 30 percent from 2020 levels by 2030, including “all feasible reductions” in the energy sector.
−Removed: These goals were reaffirmed at COP27 in November 2022, and countries were called upon to accelerate efforts to phase out inefficient fossil fuel subsidies, though no firm commitments or timelines were made.
−Removed: At the 28 th Conference of the Parties (“COP28”), the parties signed onto an agreement to transition away from fossil fuels in energy systems and increase renewable energy capacity, though no timeline for doing so was set.
−Removed: While non-binding, the agreements coming out of COP28 could result in increased pressure among financial institutions and various stakeholders to reduce or otherwise impose more stringent limitations on funding for and increase potential opposition to the production and use of fossil fuels.
−Removed: The full impact of these actions is uncertain at this time, and it is unclear what additional initiatives may be adopted or implemented that may have adverse effects upon us and our customers’ operations.
−Removed: Governmental, scientific, and public concern over the threat of climate change arising from GHG emissions has resulted in increasing political risks in the United States, including action taken by President Biden with respect to his climate change related pledges.
−Removed: On January 27, 2021, President Biden issued an executive order that called for substantial action on climate change, including, among other things, the increased use of zero-emission vehicles by the federal government, the elimination of subsidies provided to the fossil fuel industry, and increased emphasis on climate-related risks across government agencies and economic sectors.
−Removed: The Biden Administration has also called for restrictions on leasing on federal land.
−Removed: For more information, see our risk factor titled “Regulatory initiatives related to hydraulic fracturing in the countries where we and our customers operate could result in operating restrictions or delays in the completion of oil and gas wells that may reduce demand for our services.” Other actions that could be pursued by the Biden Administration may include the imposition of more restrictive requirements for the establishment of pipeline infrastructure or the permitting of LNG export facilities, as well as more restrictive GHG emission limitations for oil and gas facilities.
+Added: At the international level, in 2021, the U.S.
+Added: rejoined the Paris Agreement, which requires member nations to submit non-binding GHG emissions reduction goals every five years.
+Added: However, on January 20, 2025, President Trump signed an Executive Order withdrawing the United States from the Paris Agreement and from any other commitments made by the United Nations Framework Convention on Climate Change.
+Added: Additionally, President Trump revoked any purported financial commitment made by the United States pursuant to the same, The full impact of these actions is uncertain at this time.
+Added: Governmental, scientific, and public concern over the threat of climate change arising from GHG emissions has resulted in increasing political risks in the United States.
Litigation risks are also increasing as a number of parties have sought to bring suit against oil and natural gas companies in state or federal court, alleging among other things, that such companies created public nuisances by producing fuels that contributed to climate change or alleging that the companies have been aware of the adverse effects of climate change for some time but defrauded their investors or customers by failing to adequately disclose those impacts.
−Removed: There is also a growing trend of the SEC or parties suing public companies for “greenwashing,” which is where a company makes unsubstantiated statements designed to mislead consumers or shareholders into thinking that the company’s products or practices are more environmentally friendly than they are.
−Removed: There are also increasing financial risks for companies in the fossil fuel sector as shareholders currently invested in such companies may elect in the future to shift some or all of their investments into other sectors.
−Removed: Institutional lenders who provide financing to fossil fuel energy companies also have become more attentive to sustainable lending practices and some of them may elect not to provide funding for fossil fuel energy companies.
−Removed: For example, at COP26, the Glasgow Financial Alliance for Net Zero (“GFANZ”) announced that commitments from
−Removed: over 450 firms across 45 countries had resulted in over $130 trillion in capital committed to net zero goals.
−Removed: The various sub-alliances of GFANZ generally require participants to set short-term, sector-specific targets to transition their financing, investing, and/or underwriting activities to net zero emissions by 2050.
−Removed: There is also a risk that financial institutions will be required to adopt policies that have the effect of reducing the funding provided to the fossil fuel sector.
−Removed: In late 2020, the Federal Reserve announced that it had joined the Network for Greening the Financial System (“NGFS”), a consortium of financial regulators focused on addressing climate-related risks in the financial sector.
−Removed: Subsequently, in November 2021, the Federal Reserve issued a statement in support of the efforts of the NGFS to identify key issues and potential solutions for the climate-related challenges most relevant to central banks and supervisory authorities.
−Removed: In January 2023, the Federal Reserve issued instructions for a pilot climate scenario analysis being undertaken by six of the United States’ largest banks, which is expected to conclude near the end of 2023.
−Removed: Although we cannot predict the effects of these actions, such limitation of investments in and financing for fossil fuel energy companies could result in the restriction, delay or cancellation of drilling programs or development or production activities, which could reduce demand for our products and services.
−Removed: Additionally, the Securities and Exchange Commission published a proposed rule that would require registrants to make climate-related disclosures, including any climate targets and goals, and data on Scope 1 and 2 GHG emissions and, in certain cases, Scope 3.
+Added: There is also a growing trend of parties suing public companies for “greenwashing,” which is where a company makes unsubstantiated statements designed to mislead consumers or shareholders into thinking that the company’s products or practices are more environmentally friendly than they are.
+Added: There have also recently been increasing financial risks for companies in the fossil fuel sector as certain shareholders currently invested in such companies may elect in the future to shift some or all of their investments into other sectors.
+Added: Institutional lenders who provide financing to fossil fuel energy companies also have become more attentive to sustainable lending practices and some of them may elect not to provide funding for fossil fuel energy companies or seek to require more aggressive action with respect to climate-related risks, although this trend has waned recently and several high-profile banks and institutional investors have withdrawn from various associations that aim to limit financing of industries that emit significant GHG emissions.
+Added: Limitation of investments in and financing for fossil fuel energy companies could result in the restriction, delay or cancellation of drilling programs or development or production activities, which could reduce demand for our products and services.
+Added: Additionally, the Securities and Exchange Commission published a final rule in March 2024 that would require registrants to make certain climate-related disclosures, including any climate targets and goals, and data on Scope 1 and 2 GHG emissions.
+Added: However, the future of the rule is uncertain at this time given that its implementation has been stayed pending the outcome of legal challenges;
+Added: moreover, on February 11, 2025, SEC Acting Chairman Mark T.
+Added: Uyeda requested that the U.S.
+Added: Court of Appeals for the Eighth Circuit not schedule argument in the case while the Commission reconsiders the final rule.
+Added: The Commission under the current administration may seek to repeal or otherwise modify the rule, though we cannot predict whether such action will occur or its timings.
Several states have also enacted or are considering enhanced climate-related disclosure requirements.
−Removed: While we cannot predict the final form or substance of these rules, this may result in additional costs to comply with any such disclosure requirements.
−Removed: Additionally, we cannot predict how financial institutions and investors might consider information disclosed under such rule, and as a result it is possible that we could face increases with respect to the costs of, or restrictions imposed on, our access to capital.
+Added: While we cannot predict the final form or substance of these various rules, this may result in additional costs to comply with any such disclosure requirements.
+Added: Additionally, we cannot predict how financial institutions and investors might consider information disclosed under such rules, and as a result it is possible that we could face increases with respect to the costs of, or restrictions imposed on, our access to capital.
The adoption and implementation of new or more stringent international, federal or state legislation, regulations or other regulatory initiatives that impose more stringent standards for GHG emissions from the oil and natural gas sector or otherwise restrict the areas in which this sector may produce oil and natural gas or generate the GHG emissions could result in increased costs of compliance or costs of consuming, and thereby reduce demand for oil and natural gas, which could reduce demand for our products and services.
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Such physical risks may also impact our suppliers, which may adversely affect our ability to provide our products and services.
−Removed: Increasing attention to ESG matters and conservation measures may adversely impact our or our customers’ business.
+Added: Increased attention to ESG matters and conservation measures may adversely impact our or our customers’ business.
Increasing attention to, and societal expectations on companies to address, climate change and other environmental and social impacts, investor, regulatory and societal expectations regarding voluntary and mandatory ESG-related disclosures, and consumer demand for alternative forms of energy may result in increased costs, reduced demand for our customers’ products, reduced profits, increased investigations and litigation, and negative impacts on our stock price and reduced access to capital markets.
−Removed: Increasing attention to climate change and environmental conservation, for example, may result in demand shifts for oil and natural gas products and additional governmental investigations and private litigation against us or our customers.
+Added: Increased attention to climate change and
+Added: environmental conservation, for example, may result in demand shifts for oil and natural gas products and additional governmental investigations and private litigation against us or our customers.
To the extent that societal pressures, regulatory, political or other factors are involved, it is possible that such liability could be imposed without regard to our causation of or contribution to the asserted damage, or to other mitigating factors.
+Added: While the extent of these pressures may change from time to time, we cannot predict the ultimate impact they may have in the near, mid or long-term on our operations.
For more information, see our risk factor titled “Our operations, and those of our suppliers and customers, are subject to a series of risks arising from climate change.”
−Removed: Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, certain statements in those voluntary disclosures may be based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.
−Removed: Mandatory ESG-related disclosure is also emerging as an area where we may be, or may become, subject to required disclosures in certain jurisdictions, and any such mandatory
−Removed: disclosures may similarly necessitate the use of hypothetical, projected or estimated data, some of which is not controlled by us and is inherently subject to imprecision.
−Removed: Disclosures reliant upon such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters.
−Removed: Additionally, we may announce various targets or product and service offerings in an attempt to improve our ESG profile.
−Removed: However, we cannot guarantee that we will be able to meet any such targets or that such targets or offerings will have the intended results on our ESG profile, including but not limited to as a result of unforeseen costs, consequences, or technical difficulties associated with such targets or offerings.
−Removed: Also, despite any voluntary actions, we may receive pressure from certain investors, lenders, or other groups to adopt more aggressive climate or other ESG-related goals or policies, but we cannot guarantee that we will be able to implement such goals because of potential costs or technical or operational obstacles.
+Added: Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, certain statements in those voluntary disclosures may be based on expectations and assumptions and hypothetical scenarios that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.
+Added: Mandatory ESG-related disclosure is also emerging as an area where we may be, subject to required disclosures in certain jurisdictions, and any such mandatory disclosures may similarly necessitate the use of hypothetical, projected or estimated data, some of which is not controlled by us and is inherently subject to imprecision.
+Added: Disclosures reliant upon such expectations and assumptions and hypothetical scenarios are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters.
+Added: Additionally, we may announce various targets or product and service offerings in an attempt to improve our ESG profile, which are often aspirational.
+Added: However, we cannot guarantee that we will be able to meet any such targets or that such targets or offerings will have the intended results on our ESG profile, including but not limited to any unforeseen costs, consequences, changes to relevant accounting methodologies or technical difficulties associated with such targets or offerings.
+Added: Also, despite any voluntary actions, we may receive pressure from certain investors, lenders, or other groups to adopt more aggressive climate or other ESG-related goals or policies, but we cannot guarantee that we will be able to pursue or implement such goals because of potential costs or technical or operational obstacles.
Furthermore, our reputation, as well as our stakeholder relationships, could be adversely impacted as a result of, among other things, any failure to meet our ESG plans or goals or stakeholder perceptions of statements made by us, our employees and executives, agents, or other third parties or public pressure from investors or policy groups to change our policies.
−Removed: Such statements with respect to ESG matters are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” i.e., misleading information or false claims overstating potential ESG benefits.
+Added: Certain statements with respect to ESG matters are becoming increasingly subject to heightened scrutiny from public and governmental authorities, as well as other parties, related to the risk of potential “greenwashing.” For example, the SEC has recently taken enforcement action against companies for ESG-related misconduct, including greenwashing.
+Added: Certain regulators, such as the SEC and various state agencies, as well as non-governmental organizations and other private actors have also filed lawsuits under various securities and consumer protection laws alleging that certain ESG-statements, goals or standards were misleading, false or otherwise deceptive.
+Added: Additionally, certain employment practices and social initiatives are the subject of scrutiny by both those calling for the continued advancement of such policies, as well as those who believe they should be curbed, including government actors, and the complex regulatory and legal frameworks applicable to such initiatives continue to evolve.
+Added: We cannot be certain of the impact of such regulatory, legal and other developments on our business.
+Added: More recent political developments could mean that the Company faces increasing criticism or litigation risks from certain “anti-ESG” parties, including various governmental agencies.
+Added: Such sentiment may focus on the Company’s environmental commitments (such as reducing GHG emissions) or its pursuit of certain employment practices or social initiatives that are alleged to be political or polarizing in nature or are alleged to violate laws based, in part, on changing priorities of, or interpretations by, federal agencies or state governments.
+Added: Consideration of ESG-related factors in the Company’s decision-making could be subject to increasing scrutiny and objection from such anti-ESG parties.
As a result, we may face increased litigation risks from private parties and governmental authorities related to our ESG efforts.
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Such ratings may be used by some investors to inform their investment and voting decisions.
−Removed: Unfavorable ESG ratings and recent activism directed at shifting funding away from companies with energy-related assets could lead to increased negative investor sentiment toward us and our industry and to the diversion of investment to other industries, which could have a negative impact on our stock price and our access to and costs of capital.
−Removed: Additionally, to the extent ESG matters negatively impact our reputation, we may not be able to compete as effectively to recruit or retain employees, which may adversely affect our operations.
+Added: While such ratings do not impact all investors’ investment or voting decisions, unfavorable ESG ratings and recent activism directed at shifting funding away from companies with energy-related assets could lead to increased negative investor sentiment toward us and our industry and to the diversion of investment to other industries, which could have a negative impact on our stock price and our access to and costs of capital.
+Added: Additionally, to the extent ESG matters negatively impact our
+Added: reputation, we may not be able to compete as effectively to recruit or retain employees, which may adversely affect our operations.
Such ESG matters may also impact our customers, which may result in reduced demand for certain of our products and services.
12 unchanged sentences
• trade restrictions;
−Removed: • changes in tariffs and taxes;
+Added: • changes in tariffs, which could impact raw material prices and the cost of component parts, and taxes;
• our limited knowledge of these markets or our inability to protect our interests.
5 unchanged sentences
If we cannot obtain foreign regulatory approvals, or if we cannot obtain them in a timely manner, our growth and profitability from foreign operations could be adversely affected.
−Removed: Regulatory initiatives related to hydraulic fracturing in the countries where we and our customers operate could result in operating restrictions or delays in the completion of oil and gas wells that may reduce demand for our services.
+Added: Regulatory initiatives related to hydraulic fracturing or operations on public lands in the countries where we and our customers operate could result in operating restrictions or delays in the completion of oil and gas wells that may reduce demand for our services.
Although we do not directly engage in hydraulic fracturing, our operations support many of our exploration and production customers in such activities.
2 unchanged sentences
For example, the EPA has issued rulemakings under several laws governing hydraulic fracturing activities and disposal of wastes associated with the process.
−Removed: Moreover, the Biden Administration is expected to pursue regulatory initiatives that restrict hydraulic fracturing activities on federal lands as well as other actions to more stringently regulate certain aspects of oil and gas development such as air emissions and water discharges.
−Removed: President Biden issued an executive order on January 27, 2021, that effectively paused new leasing activities for oil and gas exploration and production on non-Indian federal lands and offshore waters pending completion of a comprehensive review and reconsideration of federal oil and gas permitting and leasing practices that take into consideration potential climate and other impacts associated with oil and gas activities on such lands and waters.
+Added: In addition, from time to time certain administrations have taken steps to limit hydraulic fracturing specifically or oil and gas production more broadly on U.S.
+Added: federal lands.
+Added: For example, President Biden previously issued an executive order that effectively paused new leasing activities for oil and gas exploration and production on non-Indian federal lands and offshore waters pending completion of a comprehensive
+Added: review and reconsideration of federal oil and gas permitting and leasing practices that take into consideration potential climate and other impacts associated with oil and gas activities on such lands and waters.
Although the federal court for the Western District of Louisiana issued a permanent injunction against the leasing pause, in response to the executive order, the Department of Interior issued a report recommending various changes to the federal leasing program, though many such changes would require Congressional action.
−Removed: However, the Bureau of Land Management proposed a rule in November 2022 that would limit flaring from well sites on federal lands, as well as allow the delay or denial of permits if the Bureau finds that an operator’s methane waste minimization plan is insufficient.
−Removed: Additionally, in July 2023 the Bureau proposed a rule to update the fiscal terms of federal oil and gas leases, increasing fees, rents, royalties, and bonding requirements.
−Removed: The rule would also add new criteria for the Bureau to consider when determining whether to lease nominated land, including the presence of important habitats or wetlands, the presence of historical properties or sacred sites, and recreational use of the land.
−Removed: The Bureau of Land Management anticipates a final action on this proposal in Spring 2024.
−Removed: As a result, we cannot predict the final scope of regulations or restrictions that may apply to oil and gas operations on federal lands and waters.
−Removed: However, any regulations that ban or effectively ban such operations may adversely impact demand for our products and services.
−Removed: The United States Congress has from time to time considered legislation to provide for federal regulation of hydraulic fracturing and to require disclosure of the chemicals used in the hydraulic fracturing process.
+Added: In April 2024, the Bureau of Land Management finalized a rule that reduces the waste of natural gas from venting, flaring and leaks from well sites on federal lands, as well as allows the delay or denial of permits if the Bureau finds that an operator’s methane waste minimization plan is insufficient.
+Added: This rule is currently subject to litigation and halted in certain states.
+Added: Additionally, also in April 2024, the Bureau finalized a rule updating the fiscal terms of federal oil and gas leases, increasing fees, rents, royalties, and bonding requirements.
+Added: Most recently, in January 2025, President Biden announced executive action under the Outer Continental Shelf Lands Act prohibiting all future oil and natural gas leasing in the U.S.
+Added: Outer Continental Shelf areas off the East and West coasts, the eastern Gulf of America, and portions of the Northern Bering Sea in Alaska However, President Trump, on his first day in office, revoked the Executive Order regarding withdrawal of leasing in the Northern Bering Sea and signed a new Executive Order promoting the expediting of permitting and leasing in Alaska as well as the development and production of the natural resources located in the state.
+Added: At this time, it is still unclear the extent to which these actions may impact our operations or the operations of customers.
At the state level, some states, including Texas, Oklahoma and New Mexico, have adopted, and other states are considering adopting legal requirements that could impose new or more stringent permitting, public disclosure, or well construction requirements on hydraulic fracturing activities.
−Removed: States could elect to prohibit high volume hydraulic fracturing altogether, following the approach taken by the State of New York in 2015.
+Added: States could elect to prohibit high volume hydraulic fracturing altogether.
Local governments also may seek to adopt ordinances within their jurisdictions regulating the time, place and manner of drilling activities in general or hydraulic fracturing activities in particular.
For example, from time to time states such as Texas and Oklahoma have suspended permitting for disposal wells in certain areas in response to seismic activity.
−Removed: If new or more stringent federal, state, or local legal restrictions relating to the hydraulic fracturing process are adopted, our customers could incur potentially significant added costs to comply with such requirements, experience delays or curtailment in the pursuit of exploration, development or production activities, and perhaps even be precluded from
−Removed: drilling wells.
−Removed: Increased regulation and attention given to the hydraulic fracturing process could lead to greater opposition to oil and gas production activities using hydraulic fracturing techniques.
−Removed: Additional legislation or regulation could also lead to operational delays or increased operating costs for our customers in the production of oil and gas, including from the developing shale plays, or could make it more difficult to perform hydraulic fracturing.
−Removed: The adoption of any federal, state or local laws or the implementation of additional regulations regarding hydraulic fracturing could potentially cause a decrease in the completion of new oil and gas wells and an associated decrease in demand for our services and increased compliance costs and time, which could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition.
+Added: If new or more stringent federal, state, or local legal restrictions relating to the hydraulic fracturing process are adopted, our customers could incur potentially significant added costs to comply with such requirements, experience delays or curtailment in the pursuit of exploration, development or production activities, and perhaps even be precluded from drilling wells.
+Added: Increased regulation and attention given to the hydraulic fracturing process or oil and gas operations on federal lands could lead to greater opposition to oil and gas production activities using hydraulic fracturing techniques.
+Added: Additional legislation or regulation could also lead to operational delays or increased operating costs for our customers in the production of oil and gas, including from the developing shale plays, or could make it more difficult to perform hydraulic fracturing or otherwise operate on federal lands.
+Added: The adoption of any federal, state or local laws or the implementation of additional regulations regarding hydraulic fracturing or oil and gas operations on federal lands could potentially cause a decrease in the completion of new oil and gas wells and an associated decrease in demand for our services and increased compliance costs and time, which could have a material adverse effect on our liquidity, consolidated results of operations, and consolidated financial condition.
Our operations, reputation, and financial condition may be impaired if our information or operational technology systems fail to perform adequately or if we are the subject of a data breach or cyberattack.
18 unchanged sentences
Changes to applicable tax laws and regulations or exposure to additional income tax liabilities could affect our business and future profitability.
−Removed: We are subject to various complex and evolving United States federal, state, and local and non-U.S.
−Removed: Our business and future profitability could be affected by numerous factors, including the availability of tax credits, exemptions, refunds and other benefits to reduce our tax liabilities, changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, the potential expansion of our
−Removed: business into or otherwise becoming subject to tax in additional jurisdictions, changes to our existing business structure and operations, the extent of our intercompany transactions, and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions.
−Removed: Further, United States federal, state, and local and non-U.S.
+Added: We are subject to various complex and evolving U.S.
+Added: federal, state, and local and non-U.S.
+Added: Our business and future profitability could be affected by numerous factors, including the availability of tax credits, exemptions, refunds and other benefits to reduce our tax liabilities, changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, the potential expansion of our business into or otherwise becoming subject to tax in additional jurisdictions, changes to our existing business structure and operations, the extent of our intercompany transactions, and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions.
+Added: Further, U.S.
+Added: federal, state, and local and non-U.S.
tax laws, policies, statutes, rules, regulations, or ordinances could be interpreted, changed, modified, or applied adversely to us, in each case, possibly with retroactive effect, and may have an adverse effect on our business and future profitability.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.