Tetra Technologies Inc (TTI) 2024 Q3 法說會逐字稿

Good morning and welcome to Tetra Technologies third quarter, 2024 results conference call. All participants will be in listen-only mode. Should you need assistance? Please signal a conference specialist by pressing the star key followed by 0.

早安，歡迎參加 Tetra Technologies 2024 年第三季業績電話會議。所有參與者將處於只聽模式。您需要幫助嗎？請按星號鍵然後按 0 通知會議專家。

After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your Touchstone phone, to withdraw your question, please press star then 2. Please note that this event is being recorded.

今天的演講結束後，將有機會提問。要提問，您可以在 Touchstone 手機上按星號然後按 1；要撤回問題，請按星號然後按 2。請注意，該事件正在被記錄。

I will now turn the conference over to Julian Higuera. Please go ahead.

現在我將會議交給朱利安·伊格拉。請繼續。

Thank you, Vincent. Good morning and thank you for joining Tetra's third quarter 2024 results call. The speakers for today's call are Brady Murphy, Chief Executive Officer and Elijio Serrano, Chief Financial Officer. I would like to remind you that this conference call may contain statements that are or may be deemed to be forward-looking including projections, financial guidance, profitability and estimated earnings. These statements are based on certain assumptions and analysis made by Tetra and are based on several factors.

謝謝你，文森。早安，感謝您參加 Tetra 2024 年第三季業績電話會議。今天電話會議的發言人是執行長布雷迪墨菲 (Brady Murphy) 和財務長 Elijio Serrano。我想提醒您，本次電話會議可能包含或被視為前瞻性的陳述，包括預測、財務指導、盈利能力和預計收益。這些聲明是基於 Tetra 所做的某些假設和分析，並基於多種因素。

These statements are subject to several risks and uncertainties many of which are beyond the control of the company. You are cautioned that such statements are not guarantees of future performance and the actual results differ materially from these projected in the forward-looking statements. In addition, in the course of the call, we may refer to EBITDA, adjusted EBITDA, adjusted EBITDA market free cash flow, net debt, net leverage ratio, liquidity returns on net capital employed and other non-GAAP financial measures.

這些聲明受到多種風險和不確定因素的影響，其中許多超出了公司的控制範圍。請注意，此類聲明並不能保證未來的業績，實際結果與前瞻性聲明中的預測有重大差異。此外，在電話會議過程中，我們可能會參考 EBITDA、調整後的 EBITDA、調整後的 EBITDA 市場自由現金流、淨債務、淨槓桿率、淨資本使用的流動性回報率和其他非 GAAP 財務指標。

Please refer to yesterday's press release or to our public website for reconciliations of non-GAAP financial measures to the nearest GAAP measures. These reconciliations are not a subject for financial information prepared in accordance with GAAP and should be considered within the context of our complete financial results for the period. In addition to our press release announcement, we encourage you to refer to our 10-Q that we also filed yesterday. I will now turn it over to Brady.

請參閱昨天的新聞稿或我們的公共網站，以了解非公認會計準則財務指標與最近的公認會計準則指標的對帳。這些對帳不是根據 GAAP 編制的財務資訊的主題，應在我們該期間的完整財務結果的背景下考慮。除了我們的新聞稿公告之外，我們還鼓勵您參考我們昨天提交的 10-Q。現在我將把話題交給布雷迪。

Thank you Julian. Good morning, everyone and welcome to tetra third quarter 2020 for earnings call. I'll summarize some highlights from our third quarter results and provide an update on our strategic initiatives before turning the call over to Leo to discuss more details on third quarter financials and additional perspectives looking forward with some views on 2025. For the third quarter despite considerable headwinds in the due to three Gulf of Mexico hurricane disruptions as well as lower customer completion activity on US land third quarter earnings free cash flow and adjusted EBITDA of 23.5 million came inconsistent with our expectations.

謝謝你，朱利安。大家早安，歡迎參加 tetra 2020 年第三季財報電話會議。我將總結我們第三季度業績的一些亮點，並提供我們戰略舉措的最新信息，然後將電話轉給 Leo，討論第三季度財務狀況的更多細節和展望 2025 年的一些觀點。第三季度，儘管受到墨西哥灣三次颶風襲擊以及美國陸地客戶完工活動減少等因素的影響，第三季度面臨相當大的阻力，但第三季度的收益自由現金流和調整後的 EBITDA 為 2,350 萬美元，與我們的預期不一致。

We achieved adjusted EBITDA margins of 31.7% for completion, fluids and products and 14.6 for water and flowback services. Because of the second quarter, seasonal peak in our northern European industrial chemicals business, the underlying performance of our business is highlighted by our year on year and first quarter comparisons.

我們實現的完井、流體和產品調整後 EBITDA 利潤率為 31.7%，水和回流服務的調整後 EBITDA 利潤率為 14.6%。由於第二季是我們北歐工業化學品業務的季節性高峰，因此與去年同期和第一季的對比凸顯了我們業務的基本表現。

Third quarter revenue of 142 million was down 6% for both year on year and from first quarter 2024 while adjusted EBITDA was down 2.5 million from Q3 of 2023 but up 700,000 from Q1 of 2024. Although revenue was lower, we achieved some very good wins in the quarter, but it is helping us build significant momentum for 2025 versus a major Deepwater Completion Fluid Award in Brazil. This is a multi-well multiyear Deepwater Award for our high value higher density bromine based completion fluids. This is our second major Deepwater Fluid Award in Brazil in the last three years and establishes us as the clear deep water heavy fluids market leader in Brazil. The first well, for this award is scheduled to start in late Q1 2025.

第三季營收為 1.42 億，年減 6%，調整後 EBITDA 較 2023 年第三季下降 250 萬，但較 2024 年第一季增加 70 萬。儘管收入較低，但我們在本季度取得了一些非常好的勝利，但與巴西的主要深水完井液獎相比，它幫助我們為 2025 年建立了強大的發展勢頭。這是一項針對我們高價值、高密度溴基完井液的多年期深水獎。這是我們在過去三年中第二次在巴西獲得重大深水流體獎項，並確立了我們在巴西深水重質流體市場的領先地位。該獎項的第一口井計劃於 2025 年第一季末開始開採。

Another important milestone for the third quarter was establishing an all-time record for produced water recycling for frac reuse with additional recent customer wins. This third quarter record will again be eclipsed in the fourth quarter by another record that is a step change over Q3. Although us completion activity has drifted down for the past 18 months, produced water is increasing and will continue to increase for many years to come. At the same time, seismicity events are driving more rapid adoption of recycling for frac reuse to avoid more over pressuring of disposal wells.

第三季的另一個重要里程碑是創下了壓裂再利用採出水回收的最高紀錄，並贏得了更多客戶的青睞。第三季的這項紀錄將在第四季再次被另一個與第三季相比有重大變化的紀錄所打破。儘管過去 18 個月美國的完井活動有所減少，但產水量卻在增加，並且在未來許多年裡也將持續增加。同時，地震事件正在推動更快速地採用壓裂再利用技術，以避免處置井的壓力過大。

Our strategy to focus our technology and investments into the produced water side of the business is paying off and has been a key part of our success, developing solutions for produced water beneficial reuse which I'll discuss a bit later.

我們將技術和投資重點放在業務的生產水方面的策略正在取得成效，並且是我們成功的關鍵部分，開發了生產水有益再利用的解決方案，稍後我將討論。

The recognition by Kimberly, a leading oil and gas research company that conducted a study on the completion fluids and services segment in arguably the most technically challenging Deepwater market in the world the Gulf of Mexico. The Kimberly study concluded that quotes ttro sales and technical support and service responsiveness and availability aligning well with its pricing strategy to create differentiation in the market unquo as future wells in production in the Gulf of Mexico will come from very challenging lower tertiary with extreme high pressures and temperatures. Tetra is very well positioned to benefit as validated by the Kimberli report.

這是金伯利 (Kimberly) 的認可，金伯利是一家領先的石油和天然氣研究公司，該公司對墨西哥灣這個全球技術挑戰性最大的深水市場中的完井液和服務領域進行了研究。金伯利的研究得出結論，銷售和技術支援以及服務響應能力和可用性的報價與其定價策略相一致，從而在市場上形成差異化，因為未來墨西哥灣的生產油井將來自極具挑戰性的下第三系，具有極高的壓力和溫度。Kimberli 報告證實，Tetra 處於非常有利的受益地位。

Coming back to the financials at the end of the third quarter, our trailing 12 months adjusted EBIDA was 100 and 1 million. We generated over 7 million of trailing 12 months total adjusted free cash flow. Even after investing 23 million in Arkansas. Our current liquidity is approximately 197 million inclusive of the 75 million delayed draw feature to fund our future Arkansas Bromine project. Now turning to the segment results, completion fluids and products third quarter adjusted margin excluding or unrealized gains or losses on investments was 32.1% up to 100 basis points or 80 basis points compared to Q1. The increase in margin was driven by a very favourable mix of higher value completion fluid sales and our industrial chemicals business that continues its very strong financial performance.

回顧第三季末的財務數據，我們過去 12 個月的調整後 EBIDA 為 1 億 100 萬美元。我們過去 12 個月的總調整後自由現金流超過 700 萬美元。即使在阿肯色州投資了 2300 萬美元。我們目前的流動資金約為 1.97 億美元，其中包括 7,500 萬美元的延遲提取資金，用於資助我們未來的阿肯色州溴計畫。現在來看看分部業績，完井液和產品第三季調整後利潤率（不包括未實現的投資收益或損失）為 32.1%，與第一季相比上升了 100 個基點或 80 個基點。利潤率的成長得益於高價值完井液銷售和工業化學品業務持續強勁的財務表現這兩個非常有利的組合。

In the third quarter, we announced the introduction of Tetra X, a new corrosion inhibitor for high temperature downhole well, environments. That is a step change improvement from what is available in the market. Today, we will market Tetra X as a blend with our current completion fluids as a premium product and service for high temperature wells and to expand our market share further for this segment including CS Neptune to potentially market Tetra X as a standalone corrosion inhibitor.

第三季度，我們宣布推出 Tetra X，一種用於高溫井下環境的新型腐蝕抑制劑。與市場上現有的產品相比，這是一個巨大的進步。今天，我們將把 Tetra X 與我們目前的完井液混合銷售，作為高溫井的優質產品和服務，並進一步擴大我們在這一領域的市場份額，包括 CS Neptune，可能將 Tetra X 作為獨立的腐蝕抑製劑進行銷售。

Looking ahead for completion fluids and services, the fourth quarter will be comparable to slightly down from the third quarter as the third quarter hurricanes in a in 1/4 and early October has had an impact on our customers deepwater completion schedules.

展望完井液和服務，第四季將與第三季相比略有下降，因為第三季 1/4 和 10 月初的颶風對我們客戶的深水完井計畫產生了影響。

The three L CS Neptune project that we announced previously is now scheduled to start in early 2025. For the water and flowback segment third quarter, adjust the EBITDA margins were 14.6% consistent with the goals that we have set. The decline in US on shore frac crew activity, which according to rice, that energy is down close to 25% over the past 18 months has lowered our completion related revenues for our US business with some pressure on margins. But we are counting that with a more aggressive development of automation, deployment of automation and new technology that allows us to get better or similar pricing, but with much lower labour cost, which is today the highest cost in this segment.

我們先前宣布的三艘 L CS 海王星計畫現計劃於 2025 年初啟動。對於水和回流部門第三季度，調整後的 EBITDA 利潤率為 14.6%，與我們設定的目標一致。美國陸上壓裂工作人員活動的減少，根據賴斯的說法，過去 18 個月中該類活動下降了近 25％，這降低了我們美國業務的完井相關收入，並對利潤率造成了一定壓力。但我們認為，隨著自動化程度的提高、自動化和新技術的部署，我們可以獲得更優惠或相似的定價，但勞動成本卻低得多，而勞動成本是目前該領域的最高成本。

Our strategy for water flow back services remains a multi-pronged approach, automating all aspects. But with a goal of bridging us to water recycling for beneficial reuse such as agriculture and industrial applications. While we've made significant progress in deploying blue links and water transfer automation, we're still in the early stages of rolling out automated systems for sandstorm and auto drill out. The early results have been exceptional and customer feedback has been very positive. Even in this lower activity environment, we're near maximum utilization for our automated sandstorms which today is only 20% of the fleet. We will upgrade and we will be upgrading another 20% in 2025.

我們的水回流服務策略仍是多管齊下，以實現各環節的自動化。但我們的目標是實現水循環利用，以實現農業和工業應用等有益的再利用。雖然我們在部署藍色連結和水轉移自動化方面取得了重大進展，但我們仍處於推出沙塵暴和自動鑽出自動化系統的早期階段。早期成果非常出色，客戶回饋也非常正面。即使在這種活動較少的環境中，我們的自動沙塵暴的利用率也接近最大，目前僅佔車隊的 20％。我們會進行升級，到 2025 年我們將再升級 20％。

This strategy linked with our growing recycling for frac reuse business will provide good cash flows to bridge us to the longer-term goal of recycling for beneficial reuse, which will be a much larger market with higher returns with regards to water desalination and beneficial reuse. We're making good progress, advancing the commercial terms for our first field pilot project in the Permian Basin. In addition, we're processing a second customer's Permian Basin water with a pilot unit at our R&D Centre to a very high-quality level. We're in discussions with other major customers for projects that in addition to West Texas and South Texas include mid-continent and Appalachia regions. We're currently have non-disclosure agreements with seven customers and are in discussions with two additional major operators.

這項策略與我們日益增長的壓裂再利用業務相結合，將提供良好的現金流，使我們實現有益再利用的長期目標，這將是一個更大的市場，在海水淡化和有益再利用方面具有更高的回報。我們正在取得良好進展，推進二疊紀盆地首個油田試點計畫的商業條款。此外，我們正在利用研發中心的試驗裝置對第二個客戶的二疊紀盆地水進行處理，使其達到非常高的品質水準。我們正在與其他主要客戶討論項目，除了西德克薩斯州和南德克薩斯州之外，還包括中部大陸和阿巴拉契亞地區。我們目前與 7 位客戶簽訂了保密協議，並且正在與另外 2 家主要業者進行商談。

Moving on to our strategic initiatives, we continue a very close and collaborative relationship and dialogue with EOS energy for their long duration energy storage electrolyte. We're confident EOS is on the verge of materially higher production volumes requiring materially higher electrolyte. In the third quarter, we manufactured qualified and delivered our first full order of the EOS electrolyte. We have also increased our manufacturing and blending capacity in West Memphis to meet the planned EOS demand as Zeus ramps and brings the automated line up the volumes of pure flow and electrolyte they require will increase materially over the minimal volumes we will ship this year. This is adding to our confidence for a very strong year in 2025.

繼續執行我們的策略性舉措，我們繼續與 EOS 能源保持非常密切的合作關係和對話，以尋求其長效儲能電解質。我們相信，EOS 的產量即將大幅提高，而這所需的電解質需求也將大幅增加。第三季度，我們生產了合格並交付了第一批 EOS 電解質訂單。我們還增加了在西孟菲斯的製造和混合能力，以滿足計劃中的 EOS 需求，隨著 Zeus 產能增加和自動化生產線的提升，他們所需的純流和電解質的數量將大大超過我們今年出貨的最低數量。這增強了我們對 2025 年強勁成長的信心。

On the Arkansas bromine side, we completed the SK 1,300 definitive feasibility report earlier in the quarter, highlighting very compelling economics with a CapEx investment of 270 million yielding an annual adjusted EBITDA increase of 90 to 115 million. The adjusted EBITDA increase the result of higher sales volumes from a mix of both Deepwater projects and long duration battery needs and lower production costs from the vertical integration.

在阿肯色州溴方面，我們在本季早些時候完成了 SK 1,300 的最終可行性報告，強調了非常引人注目的經濟效益，其資本支出為 2.7 億美元，年度調整後 EBITDA 增長 9000 萬至 1.15 億美元。調整後的 EBITDA 增加，這是由於深水項目和長壽命電池需求帶來的銷售量增加，以及垂直整合帶來的生產成本降低。

While we are confident, we can fund the project from free cash flow and current liquidity. While keeping below 2.5 net leverage ratio, we are evaluating a decision to fund the project in stages. The first stage will be a considerable reduction in the CapEx from the 270 million. And we target initial bromine production of 66% of DFS published volumes. We're still evaluating the revised CapEx investment for the stage one while also in discussions with multiple bromine suppliers to bridge our bromine supply needs until the full plant capacity is funded and realized for our lithium opportunity and project.

我們有信心，可以利用自由現金流和現有流動資金為該項目提供資金。在保持淨槓桿率低於 2.5 的同時，我們正在評估分階段為該專案提供資金的決定。第一階段的資本支出將從2.7億大幅減少。我們的目標是初始溴產量達到 DFS 公佈產量的 66%。我們仍在評估第一階段的修改後的資本支出投資，同時也在與多家溴供應商進行討論，以滿足我們的溴供應需求，直到我們的鋰機會和項目的全部工廠產能都得到資助並實現。

We're continuing the engineer work to define the project economics. But in the meantime, we're prioritizing our strategic initiatives on projects that can immediately impact our near-term results with a focus on Tetra CS Neptune fluids in the Gulf of Mexico. Such a pure flow electrolyte shipments to EOS energy further advancing our water desalination, commercial pilots. Long term, we believe that lithium prices will rebound to levels that support increased investment in supply, especially from the US. And we and our Evergreen unit partner remain focused on completing all the engineering studies required to define the lithium project economics.

我們正在繼續工程工作來確定專案的經濟性。但同時，我們正在優先考慮那些可以立即影響我們近期業績的專案策略舉措，重點是墨西哥灣的 Tetra CS Neptune 流體。如此純流電解質運輸至EOS能源將進一步推動我們的海水淡化商業試點。從長遠來看，我們相信鋰價將反彈至支持增加供應投資的水平，尤其是來自美國的投資。我們和我們的長榮單位合作夥伴將繼續專注於完成確定鋰專案經濟性所需的所有工程研究。

With that, I'll turn it over to Elijio would provide some additional commentary on our financial results and then we'll open it up for questions.

說完這些，我將把話題轉到 Elijio 身上，讓他對我們的財務結果提供一些額外的評論，然後我們再開始回答問題。

Thank you, Brady and good morning everybody. We expect the first of the three Neptune wells that we previously announced begin in the first quarter and the other two wells in the subsequent quarters. We believe additional Neptune opportunities in the Gulf of Mexico are likely in 2025 based on projects that are under discussion with operators. These Neptune projects, the Brazil departure award and the very stadium predictable calcium chloride industrial business that has a seasonal peak in the second quarter.

謝謝你，布雷迪，大家早安。我們預計，先前宣布的三口海王星井中的第一口將在第一季開始開採，另外兩口井將在接下來的幾季開始開採。根據正在與營運商討論的項目，我們相信 2025 年墨西哥灣可能會有更多海王星油田開發機會。這些海王星計畫、巴西出發獎和非常可預測的氯化鈣工業業務在第二季度迎來季節性高峰。

Plus the progress is making with their automation and its related backlog is preparing us for what we believe to be a very strong first half of 2025. This is the most visibility we've had for our completion flus and product segment in many years. And the actions we've taken to expand blending and storage capacity in the UK, Gulf of Mexico and Brazil Plus sourcing additional roaming volumes in open market purchases is expected to allow us to capitalize on these opportunities.

此外，他們的自動化和相關積壓工作也在不斷取得進展，為我們預計的 2025 年上半年的強勁表現做好了準備。這是多年來我們的完井流感和產品領域獲得的最高知名度。我們已採取措施擴大在英國、墨西哥灣和巴西的混合和儲存能力，並在公開市場採購額外的漫遊量，預計這將使我們能夠利用這些機會。

Ahead of next year, we will be building inventory to deliver on these projects that in the fourth quarter will add to working capital, but we will be monetized in the first half of next year. In addition, recall that we previously expanded our production capacity in Cocoa Finland for additional volumes of calcium chloride for the industrial sector.

在明年之前，我們將建立庫存以交付這些項目，這些項目將在第四季度增加營運資金，但我們將在明年上半年實現貨幣化。此外，回想一下，我們之前擴大了芬蘭可可的生產能力，為工業部門提供更多的氯化鈣。

Our industrial chloride business, calcium chloride business is approximately $140 million per year with the with EBITDA margins of approximately 30%. And this represents a very steady and solid source of revenue, EBITDA and cash flow for us when there is uncertainty in certain oil and gas markets. And we recently expanded our capacity in West Memphis to produce the required volumes pure flow but also the full electrolyte to meet EOS demands.

我們的工業氯化物業務、氯化鈣業務每年約 1.4 億美元，EBITDA 利潤率約為 30%。當某些石油和天然氣市場存在不確定性時，這對我們來說是一個非常穩定且堅實的收入來源、EBITDA 和現金流。我們最近擴大了西孟菲斯的產能，以生產所需數量的純液以及完整的電解質，從而滿足 EOS 的需求。

The fourth quarter is expected to mirror the third quarter for revenue and adjust a little bit down as the 1st year, Neptune the project that we expected in the fourth quarter was pushed into the first quarter due to the hurricanes that came through the Gulf of Mexico in the past few months. We expect a material ramp up in this segment in the first quarter from the Gulf of Mexico, Neptune projects plus the benefit of the Brazil Award and the electrolyte shipments to EOS.

預計第四季度的收入將與第三季度持平，但會略有下調，因為第一年，我們預計在第四季度完成的海王星項目由於過去幾個月襲擊墨西哥灣的颶風而被推遲到第一季度。我們預計，由於墨西哥灣和海王星項目以及巴西合約獎和 EOS 電解質出貨量的成長，第一季該領域的材料產量將會增加。

Then another step up in the second quarter on the back of the European industrial calcium chloride seasonality 15 to water and flowback services, we expect revenues to be down in the fourth quarter in anticipation of 1/4 quarter, slowdown and without the third quarter EPF expansion sale. However, as Brady mentioned, we expect fourth quarter margins for water and flowback services to remain the midteen driven by increasing volumes of recycled, produced water for frac reuse and the automation efforts that we're implementing.

然後，由於歐洲工業氯化鈣季節性 15 對水和回流服務的推動，第二季收入將再次上升，我們預計第四季度收入將下降，因為預計 1/4 季度經濟放緩，並且沒有第三季 EPF 擴張銷售。然而，正如布雷迪所提到的，我們預計第四季度供水和回流服務的利潤率將保持在中等水平，這得益於用於壓裂再利用的回收和生產水量的增加以及我們正在實施的自動化工作。

If operators continue to transfer, utilize more produced water in their frac operations through treatment recycling, the risk profile of produced water spills increases in the value of automation technology allows us to gain stronger margins in this segment. Overall. Fourth quarter adjusted EBITDA will be modestly below the third quarter that included the benefit of EPF sale in Argentina.

如果操作員繼續透過處理回收在壓裂作業中轉移和利用更多的生產水，生產水洩漏的風險狀況將隨著自動化技術價值的增加而增加，使我們能夠在這一領域獲得更高的利潤。全面的。第四季調整後的 EBITDA 將略低於包含阿根廷 EPF 銷售收益的第三季。

And while we won't be providing 2025 guidance, we believe that the step-up next year and expected earnings coming from Neptune, the Brazil Deepwater Award and the expected ramp up of shipments to EOS plus our strong focus on cost controls, position us for a very solid 2025, unlike what others in the industry might be expecting or projecting. Third quarter adjusted free cash flow for continuing operations was $19.9 million including the impact of $8.7 million of capital expenditures for the Arkansas bromine and lithium projects. As expected, working capital came down materially in the third quarter, as we monetize the receivables in northern Europe during the quarter. We continue to work on cash flow from the base business funding the immediate capital requirements in Arkansas.

雖然我們不會提供 2025 年的指引，但我們相信，明年的增長和來自 Neptune 的預期收益、巴西深水獎以及 EOS 出貨量的預期增長，再加上我們對成本控制的高度重視，將使我們在 2025 年的業績非常穩健，這與業內其他人的預期或預測不同。第三季調整後的持續經營自由現金流為 1,990 萬美元，其中包括阿肯色州溴和鋰計畫 870 萬美元資本支出的影響。正如預期的那樣，由於我們在本季將北歐的應收帳款貨幣化，營運資本在第三季大幅下降。我們持續致力於利用基礎業務的現金流來滿足阿肯色州的即時資本需求。

Both for this and next year, we continue to be reimbursed by our evergreen unit partner for their agreed upon share of costs were incurred. Our objective remains to keep our net leverage ratio low and not issue any equity linked securities to fund our Arkansas bromine investments. We will instead space out the project before over levering Tetra or before diluting shareholders.

無論今年或明年，我們常青單位合作夥伴都將繼續向我們償還他們商定的分擔成本。我們的目標仍然是保持較低的淨槓桿率，並且不發行任何股票掛鉤證券來資助我們的阿肯色州溴投資。我們將在過度槓桿化 Tetra 或稀釋股東權益之前將該項目擱置一段時間。

In addition to the no liquidity, we are also holding slightly over $14 million of marketable securities. This includes our holdings in standard lithium and Kodiak gas services. The market gains we are recognizing can quickly be converted into cash given the trading activity of these two entities. At the end of the third quarter, our net leverage ratio was 1.5 times. Our return on capital is 16.6% for the trading12 months ended September 30 compares to our weighted average cost of capital of between 11 and 12%.

除了沒有流動性之外，我們還持有價值略高於 1,400 萬美元的有價證券。其中包括我們在標準鋰和科迪亞克天然氣服務的持股。鑑於這兩個實體的交易活動，我們所確認的市場收益可以迅速轉化為現金。截至三季末，我們的淨槓桿率為1.5倍。截至 9 月 30 日的 12 個月交易日，我們的資本回報率為 16.6%，而我們的加權平均資本成本為 11% 至 12%。

Let me close out by summary, summarizing what I believe the key terms that everyone should focus on first are completion, fluids and products that perform quite well with adjusted EBITDA of margins of 31.7% without mark to market gains. We're going into the fourth quarter when we expect margins for this segment to remain in the high 20% range and improve to the low 30% range when the Neptune projects kick in. We have the best backlog in many years going into next year.

最後，讓我做個總結，總結一下我認為每個人首先應該關注的關鍵術語，即完井、流體和產品，這些產品表現相當不錯，調整後的 EBITDA 利潤率為 31.7%，沒有按市價計價的收益。進入第四季度，我們預計該部門的利潤率將保持在 20% 的高位，而當海王星計畫啟動時，利潤率將提高到 30% 的低點。進入明年，我們的訂單積壓量將是多年來最好的。

We remain confident that between our borrowing capacity and free cash flow that we can fund our roaming projects that have no plans to issue any equity linked securities. As I mentioned, we have around $14 million of marketable securities completely at our discretion as to when we can monetize that, I'll remind everyone that the last time we did this, we raised $80 million by selling our prior holdings in standard lithium.

我們仍然相信，憑藉我們的借貸能力和自由現金流，我們可以為沒有計劃發行任何股票掛鉤證券的漫遊項目提供資金。正如我所提到的那樣，我們擁有約 1400 萬美元的有價證券，至於何時將其貨幣化，我們完全可以自行決定，我要提醒大家，上次我們這樣做時，通過出售我們之前持有的標準鋰股份籌集了 8000 萬美元。

Additionally, as we continue to deploy automation technology across all our water and flowback services to maintain margins in the mid-10s, even in a down market. And in the third quarter, we set the all-time volume for produced water that Brady mentioned.

此外，我們將繼續在所有供水和回流服務中部署自動化技術，即使在低迷的市場中也能維持 15% 左右的利潤率。第三季度，我們創下了布雷迪提到的採出水歷史最高產量。

It is anticipated that us onshore activity will remain slower throughout the fourth quarter. And as a result, we initiated in the third quarter, a series of cost reduction actions including a slightly over 6% reduction in SGA head count and will continue to write size our US operations.

預計整個第四季美國陸上活動仍將維持放緩。因此，我們在第三季啟動了一系列成本削減措施，包括將 SGA 員工數量減少略高於 6%，並將繼續擴大我們美國業務的規模。

I'll return this back to Brady for closing comments.

我將把此內容交還給 Brady 以供最後評論。

Well, thank you Eli. In closing, despite the third quarter, headwinds that we discussed. Our financial performance was in line with our expectations looking 2025 and beyond. We're getting more clarity around the strategic initiatives that we've been working for some time. Meaningful contribution from CS Neptune. We're covering deep water market and market share wins, including Brazil, automating our water and flowback services for increased efficiency and enhanced margins. Focusing on produced water treatment and recycling with record volumes, bridging us to beneficial reuse and a steady ramp up in electrolyte sales all giving us more confidence in our 2025 outlook and beyond with that will open the call for questions.

好吧，謝謝你，Eli。最後，儘管我們討論了第三季的不利因素。我們的財務表現符合我們對 2025 年及以後的預期。我們對一段時間以來一直在努力實施的策略性舉措有了越來越清晰的認識。CS Neptune 做出了有意義的貢獻。我們涵蓋深水市場並贏得市場份額，包括巴西，實現供水和回流服務自動化，以提高效率和增加利潤。專注於創紀錄產量的生產水處理和回收，為我們實現有益的再利用和電解質銷售的穩步增長架起橋樑，這一切都讓我們對 2025 年及以後的前景更有信心，這將引發人們的提問。

We will now begin the question-and-answer session to ask a question. You may press star then one on your touchtone phone.

我們現在開始問答環節來問一個問題。您可以在按鍵電話上按星號，然後按一。

If you're using a speaker phone, please pick up your handset before pressing the keys. To withdraw a question please press star then 2. Your first question comes from Steven Gengaro with DFO.

如果您使用的是揚聲器電話，請在按下按鍵之前拿起聽筒。若要撤回問題，請按星號，然後按 2。您的第一個問題來自 DFO 的 Steven Gengaro。

Thanks. Good morning, everybody.

謝謝。大家早安。

So, I guess, I guess two things for me and what I would, I guess what I would start with is, is as we think about the conversations you're having on, on deep water projects and you, I know a alluded to some, maybe some incremental CS Neptune projects in 2025. Where do these sort of stand as far as the conversations, like as we sort of, as we sort of think about the back half 25 I mean, are these projects which are underway they're in the drilling phase and you're, it's just a matter of kind of who they choose from a completion perspective or is it something else that kind of gives you that confidence?

所以，我想，對我來說有兩件事，我想首先說的是，當我們思考您就深水項目進行的對話時，我知道您提到了一些，也許是 2025 年的一些增量 CS Neptune 項目。就我們的談話而言，這些情況如何？

Yeah, so Steven, we've talked before about the pipeline of CS Neptune projects that we've been tracking for some time. You know, and, and as we came out of COVID, a lot of those projects were put on, on pause on hold, but we mentioned previously, we've seen that pipeline starting to move forward. And obviously, we've announced our first three well award, first ever three well simultaneous award of the CS Neptune project that with a super major that will start in in the first quarter, there are additional projects in the pipeline. You know, I think we're cautiously optimistic that we can secure more Neptune projects in 2025. But again, these are not projects that I would say the drilling has already started. So, we want to be careful about the timing of committing to when you know, we'll secure those orders. But, you know, we feel really good about the pipeline of opportunities for Neptune and it's really not a case of, you know, well, another solution be selected because really Neptune is unique in that regard and that today, there's not a competing offering in the price range that we have Neptune positioned. So, it's really more of project timelines and you know, compatibility with a lot of their other.

是的，史蒂文，我們之前談過我們已經追蹤了一段時間的 CS Neptune 專案流程。你知道，隨著我們擺脫 COVID，許多項目都被擱置、暫停，但我們之前提到過，我們已經看到這些項目開始向前推進。顯然，我們已經宣布了我們的第一個三口井獎項，這是 CS Neptune 項目的首個三口井同時獎項，其中一個超級項目將於第一季度啟動，還有其他項目正在籌備中。你知道，我認為我們謹慎樂觀地認為我們能在 2025 年獲得更多的海王星計畫。但再次強調，我認為這些項目的鑽探工作尚未開始。所以，我們要謹慎選擇承諾的時間，以確保我們能確保這些訂單。但是，你知道，我們對 Neptune 的機會管道感到非常滿意，而且這實際上不是一個選擇另一個解決方案的情況，因為 Neptune 在這方面確實是獨一無二的，而且今天，在我們為 Neptune 定位的價格範圍內沒有競爭產品。因此，這實際上更多的是專案時間表，以及與許多其他專案的兼容性。

Okay. Now that helpful. The other question I had was just around the water and flowback business. And as we think about 2025 at a high level, would you expect, I mean, we're hearing pretty consistently is kind of flat us activity from current levels. Would you expect to see growth in that business under that scenario? And and, and you agree with that scenario.

好的。這很有幫助。我的另一個問題是關於水和回流業務。當我們從高層次思考 2025 年時，您是否會預期，我的意思是，我們聽到的相當一致的聲音是美國的活動與當前水平相比持平。在這種情況下，您預期該業務會成長嗎？而且而且，你同意這種情況。

Yeah, I think early days for predicting the full year for 2025. I think, you know, we are anticipating 1/4 quarter, you know, slow down with the typical seasonality at the end of the year. We think Q1 will start back up, you know, fairly flattish to up from where we end in Q4, but again, we're really more focused on margin enhancement at this point, Steven than we are our growth. We've gained tremendous market share through our produced water, but we're not investing a lot of capital in growth next year. But we are investing in our automation technology to continue to bring those margins up and, and, and if we get additional growth on top of that, you know, that great. But our anticipation at this point is flattish for 25 but continuing to increase our, our margins as we go through the year.

是的，我認為預測 2025 年全年還為時過早。我認為，我們預計 1/4 個季度的成長會因年底的典型季節性而放緩。我們認為第一季的業績將會回升，從第四季末的水平開始相當平穩地上升，但史蒂文，我們現在更關注的是利潤率的提高，而不是成長。我們透過生產水獲得了巨大的市場份額，但我們明年不會在成長上投入大量資金。但我們正在投資自動化技術，以繼續提高利潤率，如果我們在此基礎上獲得額外的成長，那就太好了。但我們目前的預期是 25%，但隨著時間的推移，我們的利潤率將繼續增加。

Okay, great. Now that's all for me, I'll get back in line. Thank you.

好的，太好了。對我來說，這就夠了，我要回去排隊了。謝謝。

Thanks, Steve.

謝謝，史蒂夫。

Your next question comes from the line of Kurt Haard with benchmark.

您的下一個問題來自基準專家 Kurt Haard。

Hey, good morning.

嘿，早安。

Guys. Good morning. Kurt.

夥計們。早安.庫爾特。

Hey so Brady, very encouraging dynamics, looks like now on some of those emerging growth, you know, opportunities and, and I know you guys are kind of more at now to, you know, let the numbers speak for themselves, but in the in the context of, you know, how you think about the prospects for, let's say the water desalinization you got what, seven NDA's and another two more in negotiation, like can you walk us through just like, you know what the process is at the EP level and what they need to go through and, and then you know how you try to kind of factor in timing.

嘿，布雷迪，這是非常令人鼓舞的動態，看起來現在出現了一些新興的增長機會，我知道你們現在更想讓數字說話，但是在背景下，你知道，你如何看待前景，比如說海水淡化，你得到了七份保密協議，還有兩份正在談判中，你能帶我們了解一下，你知道 EP 級別的時間流程是怎樣的，他們需要經歷什麼，然後你知道如何考慮你的因素。

Yeah. So, this is, a very interesting, you know, market, it's a brand-new market, so it's still emerging Kurt, but the way, we see it emerged, first of all, we've had, you know, one customer that we've been working with very collaborative with now for a couple of years, we've already done a field pilot trial, you know, two years ago, we announced the South Texas project that got somewhat put on hold due to permitting, shifted to the permian and we're now very close to, you know, having that one moving forward. But in the meantime, you know, we've opened up dialogue with, as we said, seven different customers that were willing to go under NDA and look at our technology and two more major operators that we're negotiating NDA's with.

是的。所以，這是一個非常有趣的市場，它是一個全新的市場，所以它仍然處於新興階段，庫爾特，但我們看到它出現的方式，首先，我們有一個客戶，我們已經與他合作了幾年，我們已經進行了現場試點試驗，你知道，兩年前，我們宣布了南德克薩斯州的項目，由於許可問題而被擱置，轉移到二疊紀，現在我們非常接近這個項目。但同時，正如我們所說，我們已經與七個不同的客戶展開了對話，他們願意在保密協議 (NDA) 下了解我們的技術，另外還有兩家主要營運商正在與我們協商保密協議。

So, the stages as we see it is they will take their produced water samples, you know, and analyse the specifications of these water and they're all very different the permian is by far the most complex just because of the amount of constituents and organics that are in it. And then they will give us an opportunity to run, you know, those sample waters through our pilot operations at our research center. And once we show them what we're capable of doing at the research center, then we move into field pilot operations, commercial pilot operations discussions. And that's more or less where we are right now with several, several of those customers. Again, we've been successful with every water treatment that we've been asked to process. And so, as we go through 2025 I think you'll see multiple pilots and then hopefully, as we get into 2026 we'll start to see.

因此，我們看到的階段是，他們將採集生產的水樣本，並分析這些水的規格，它們都非常不同，二疊紀是迄今為止最複雜的，只是因為其中的成分和有機物的數量。然後他們會給我們一個機會，讓我們在我們的研究中心透過試點操作來運行這些樣品水。一旦我們向他們展示了我們在研究中心的能力，我們就會進入現場試點運營和商業試點運營討論。這就是我們現在與幾位客戶大致相同的情況。再次，我們每次被要求進行的水處理都取得了成功。因此，當我們進入 2025 年時，我認為你會看到多個試點，然後希望，當我們進入 2026 年時，我們會開始看到。

Yeah, that's great. And then what about the context? Like is it, it's the E MP S, right? Just kind of refresh, refresh your EPS, have to get the permits from the Texas railroad commission. How long is that?

是的，太棒了。那麼上下文又如何呢？就像是，它是 E MP S，對嗎？只需刷新一下，刷新一下您的 EPS，就必須獲得德克薩斯鐵路委員會的許可。那有多長？

Yeah, it is the MPS water, they own the water. We don't take possession of the water. We're charging a technology and servicing fee to process that water for them. So, they are responsible for getting the permits with the railroad commission. Although obviously, you know, the railroad commission is, is defining those specifications to be able to put, you know, produced water into the environment on the ground into industrial applications in the farming tetra that that process is moving forward. I think the railroad commission is pretty highly motivated to get this moving. But you know, we are, we are obviously dependent on how fast they will approve our customers permits to how fast we'll be able to grow with that, that current. So, it's hard, you know, we don't control that process, but I can tell you, we're seeing a lot of a lot of momentum.

是的，這是 MPS 水，他們擁有這些水。我們不佔有水。我們收取技術和服務費來為他們處理這些水。因此，他們負責向鐵路委員會取得許可證。雖然很明顯，你知道，鐵路委員會正在定義這些規範，以便能夠將生產的水放入地面環境中，用於農業領域的工業應用，這個過程正在向前推進。我認為鐵道委員會非常積極地推動這項進程。但你知道，我們顯然依賴他們批准我們客戶許可證的速度，以及我們能夠以多快的速度成長。所以，這很難，你知道，我們無法控制這個過程，但我可以告訴你，我們看到了很多很大的動力。

For Elijio. Think Eli you just gave us a reference point in terms of the industrial chemicals part of your business, about 100 and 40 million a year. I guess then simple math would tell us that the oil and gas completion fluids part would be about 160 looks like that's going to, you know, basically hold pretty consistent going into next year with all the growth and coming from, you know, Brazil and the Neptune project so is there. I know you've been somewhat hesitant to kind of provide specifics on this in the past, but is there any kind of you know, range you can potentially provide us as to, you know, what the Neptune and Brazil projects could mean in terms of, you know, revenue growth.

為了 Elijio。想想 Eli，你剛剛為我們提供了一個關於你業務中工業化學品部分的參考點，大約每年 1 億到 4 千萬美元。我想，簡單的數學計算就會告訴我們，石油和天然氣完井液部分大約是 160，看起來，隨著​​所有的增長以及來自巴西和海王星項目的增加，這一數字基本上會保持相當穩定的狀態到明年。我知道您過去一直不太願意提供這方面的具體信息，但您能否提供一些具體信息，例如海王星和巴西項目對收入增長意味著什麼？

The Neptune projects are hard to predict because it really depends on how much fluid is lost in the well and how long the fluid is in the in the well. We've indicated that these are slightly smaller projects and what we saw with Exxon when we did the Exxon projects between 2015 and 2019, but the margins are very strong and even smaller Gulf of Mexico projects will have a meaningful impact on EBITDA. And I did mention that when we do Neptune projects, it pushes the entire segment into the low 30 EBITDA margins.

海王星計畫很難預測，因為它實際上取決於井中損失了多少液體以及液體在井中停留了多長時間。我們已經指出，這些項目規模略小，與我們在 2015 年至 2019 年期間進行埃克森美孚項目時看到的情況類似，但利潤率非常高，即使是規模較小的墨西哥灣項目也會對 EBITDA 產生重大影響。我確實提到過，當我們進行海王星計畫時，它會將整個部門的 EBITDA 利潤率推至 30% 以下。

Okay. Then the Brazil project is not a Neptune project though, right?

好的。那麼巴西項目不是海王星項目，對嗎？

No, Kurt, that's not a Neptune project, but it, you know, it is one of our heavy brine bromine brine solutions. So, it's similar to a Gulf of Mexico, you know, Deepwater Project that is non-Neptune. So, it's material for us.

不，庫爾特，這不是海王星項目，但你知道，這是我們的重鹽水溴鹽水之一。所以，它類似於墨西哥灣的非海王星深水計畫。所以，這對我們來說很重要。

Okay? And then maybe just to follow up, you mentioned, you know, staging out the Bromine expansion type of dynamic and how should we think about that If the total investment I think you referenced was like 75 million bucks. I know 270 was a total but you referenced the delayed draw at 75 million potentially being earmarked, you know, for the bromine, how do you think about the staging of it?

好的？然後也許只是為了跟進，您提到，您知道，分階段推出 Bromine 擴展類型的動態，我們應該如何看待這一點，如果我認為您提到的總投資是 7500 萬美元。我知道總數是 270，但您提到延遲抽獎可能會撥出 7500 萬美元用於溴，您如何看待它的分階段實施？

Yeah. So, we're not prepared yet to say what the stage one financials will look like Kurt, we're still doing our evaluation on that. We will be targeting a lower initial B roaming production, as I mentioned on the call, probably in over 60 65% of what's published in the DFS is the Bromine target. But we think the CapEx savings will be pretty significant. We're just not ready yet to publicize what that reduction in CapEx will be for the first place.

是的。所以，我們還沒準備好說出第一階段的財務狀況會是什麼樣子，庫爾特，我們仍在對此進行評估。正如我在電話會議上提到的那樣，我們將以較低的初始 B 漫遊產量為目標，DFS 中公佈的 60% 以上可能是溴目標。但我們認為資本支出節省將相當可觀。我們還沒有準備好公開資本支出將減少多少。

Next question comes from Martin Malloy with Johnson Price.

下一個問題來自 Johnson Price 的馬丁·馬洛伊 (Martin Malloy)。

Good morning. First question I wanted to ask is on the bromine project as well. You previously talked about FID in the fourth quarter, I think for this project, is that still the case and then I also wanted to find out with this project. Is there the possibility of offtake agreements to derisk the project?

早安.我想問的第一個問題也是關於溴項目的。您之前談到了第四季度的 FID，我認為對於這個專案來說，情況是否仍然如此，然後我也想透過這個專案找出答案。是否有可能透過承購協議來降低專案風險？

There is possibility of offtake agreements, but the reality of the situation is right now for us, you know, Martin between our deepwater demand needs and what we anticipate from EOS. We won't have additional, you know capacity until later years when we're fully, you know, utilizing the plant to take on too many additional offtake agreements. We've got our demand pretty well, pretty well consumed with bromine suppliers to get additional supply to supplement, you know, the bridge that we may do if we, if we stage this out as opposed to FID, the full, the full 270 I would say at this point, the way we're thinking, I think it's highly likely we will execute on the staged approach with the lower capital and somewhat lower bromine supply initially from the plant. So, FID ing the full 270 in the fourth quarter will probably not happen. But I think it's very likely you'll see some announcement and approvals of a staged approach, if not in Q4, potentially in Q1.

有可能達成承購協議，但對我們來說，目前的現實情況是，你知道，馬丁，我們的深水需求和我們對 EOS 的預期之間。直到後來我們充分利用工廠承擔太多額外的承購協議時，我們才會有額外的產能。我們的需求已經得到很好的滿足，溴供應商也已經充分滿足了我們的需要，以獲得額外的供應來補充，你知道，如果我們分階段實施而不是 FID，那麼我們可能會建立起一座橋樑，全部 270，我想說在這一點上，我們的想法是，我認為我們很有可能會採用分階段的方式，最初從工廠開始使用較低的資本和略低的資本供應。因此，第四季的 FID 可能不會達到全部 270 的水平。但我認為，您很可能會看到一些分階段舉措的公告和批准，如果不是在第四季度，那麼可能是在第一季。

And Marty, all that, that we've been taking steps and investing in the amount that we've extended to date to secure land, to clear the land, to make sure we've got access to power and also to advance a lot of the engineering studies. So, it's not as if we've been waiting for FID to take some of the initiatives required to make sure that we bring our project online and time to meet the demand.

馬蒂，我們一直在採取措施，並投入迄今為止已投入的資金來保護土地、清理土地、確保我們能夠獲得電力，並推進許多工程研究。因此，我們並不是一直在等待 FID 採取一些必要的措施來確保我們的專案上線並有時間滿足需求。

Okay. Great. And then second question I just wanted to ask about the desalinization technology. Could you maybe just take a moment to discuss how your technology compares to others that are out there? What the advantages are that you see with your technology?

好的。偉大的。第二個問題我想問的是海水淡化技術。您能否花一點時間討論一下您的技術與其他技術相比有何不同？您認為你們的技術有哪些優勢？

Sure. Hope we don't get too far into the weeds in this. But since you ask, I'll try to address it. So, there's, there's think of it in 33 stages of the process. But the first stage is pre-treating all of the produced water. You know that we receive to treat it, to take out a lot of the organics, a lot of the harmful to allow us to run it to the second stage of the process. And that, that first stage is very proprietary to us. It's something we've been working on for a very long time. You know, through our current recycling of produced water services that we offer today and the experience we've gained from that.

當然。希望我們不要在這件事上陷入太深的困境。但既然你問了，我會盡力解決。因此，我們可以將這個過程分成 33 個階段。但第一階段是對所有生產的水進行預處理。你知道我們要對其進行處理，去除大量的有機物和有害物質，以便我們可以進入過程的第二階段。而且，第一階段對我們來說是專有的。這是我們長期以來一直致力於的事情。您知道，透過我們目前提供的採出水回收服務以及從中獲得的經驗。

But the second stage of that allows us to run this through 22 different types of technologies that are both membrane technologies. If it's a low total dissolve, typically, if it's a low TDS total dissolved solids type of produced water, we will run that through the high re unit, which is an osmotically assisted reverse osmosis. And again, that technology is used to desalinate ocean water all over the world.

但第二階段讓我們能夠透過 22 種不同類型的技術來運行這個過程，這些技術都是薄膜技術。如果總溶解物含量較低，通常，如果是低 TDS 總溶解固體類型的生產水，我們將把它通過高再滲透裝置，這是一種滲透輔助逆滲透。而且該技術已被世界各地用於海水淡化。

So, it's a proven technology. It's just that no one is pre-treating produced water to the levels that allow it to run through the membranes to, to allow the economics of the, of the technology to work through not changing filing membranes every, you know, every couple of weeks or so. So that's if it's a high total dissolved solid, produced water then we will run that through typically, the KMX unit.

所以，這是一項經過驗證的技術。只是沒有人對採出水進行預處理，使其能夠穿過膜，從而實現技術的經濟效益，而無需每隔幾週左右更換一次填充膜。因此，如果總溶解固體含量高，則生產水通常會透過 KMX 裝置進行運作。

That's a different type of technology. It's a vacuum membrane distillation type of technology. What allows us to process much higher levels of, of salts and desalinate higher levels of salts in the water. Both of those are proprietary technologies detector. We've got proprietary for oil and gas. I should clarify a proprietary for oil and gas applications.

這是一種不同類型的技術。這是一種真空膜蒸餾類型的技術。這使得我們能夠處理更高濃度的鹽，並淡化水中更高濃度的鹽。這兩種都是專有技術探測器。我們擁有石油和天然氣的專屬權。我應該澄清石油和天然氣應用的專有性。

And you know, really pleased with the relationships and the technologies that we've been able to prove out with both of those. And then the third phase is really another kind of final treatment process by tetra and that will depend on the specific customer spec specifications for certain constituents in the water or if it's related to the permitting that ultimately, the railroad commission will give to meet, you know, certain thresholds of minerals. And again, that will be another proprietary post treatment process. So those three stages, the two in the middle are the two proprietary membrane technologies and then our pre and post treatment on the tetra side, I hope that describes it without no.

你知道，我們對我們與這兩家公司的關係以及我們能夠證明的技術感到非常高興。然後，第三階段實際上是由 tetra 進行的另一種最終處理過程，這將取決於特定客戶對水中某些成分的規格說明，或者是否與鐵路委員會最終給予的許可有關，以滿足某些礦物質閾值。再次強調，這將是另一個專有的後處理過程。因此，在這三個階段中，中間的兩個是兩種專有膜技術，然後是我們在四面體的預處理和後處理，我希望這可以毫無遺漏地描述它。

That was great. I really appreciate it. Thank you so much. And I'll turn it back.

那很棒。我非常感激。太感謝了。我會把它轉回去。

Next question comes from the line Bobby Brooks with Northland capital markets.

下一個問題來自北國資本市場的 Bobby Brooks。

So, the AOGC ruling on lithium royalties is slated for next Monday and you guys are in a really unique spot given you will be both, you guys are both producers of lithium and evergreen and then also you're going to be receiving royalties from standard lithium because of your acreage deal, right? So could you just take a few minutes or a couple to discuss your expectations for the ruling and maybe anything important to note from an outside perspective?

因此，AOGC 關於鋰使用費的裁決定於下週一作出，而你們的處境非常特殊，因為你們既是鋰生產商，又是常青生產商，而且由於你們的土地交易，你們還將從標準鋰中獲得使用費，對嗎？那麼，您能否花幾分鐘或幾分鐘來討論一下您對裁決的期望，以及從外部角度來看有什麼重要的事情需要注意？

Yeah. So, the November 4th I believe is the date for the hearing. You know, we again, collaborating with others in the industry have been working, prepare what we think is a very justifiable and optimal royalty structure that will support both investment in lithium and benefit, you know, the residents and citizens within Arkansas for this, this type of technology. But I can't predict how the outcome.

是的。因此，我認為 11 月 4 日是舉行聽證會的日期。您知道，我們再次與業內其他人合作，準備一個我們認為非常合理和最佳的使用費結構，這將支持對鋰的投資，並使阿肯色州的居民和公民受益於這種技術。但我無法預測結果會如何。

I think the state officials are very motivated to, to get this royalty set and in place so that investment can move forward. I don't think until the royalty is set; you're going to be seeing any commitments for any projects until that royalty is set. So very difficult to obviously do your economics of a project until that, that royalty is set. So, I can't predict the outcome, but I do know the state is very motivated to get to get this approved and moving forward and we're quite hopeful.

我認為州政府官員非常積極地制定和落實這項特許權使用費，以便投資能夠向前推進。我認為直到版稅確定之後；在確定特許權使用費之前，您將會看到任何項目的承諾。因此，在特許權使用費確定之前，顯然很難對專案進行經濟評估。所以，我無法預測結果，但我知道州政府非常希望獲得批准並推動該法案的實施，我們也對此充滿希望。

I'm sorry, Bobby was the second part of your question. I know you were asking about our expectations for the fourth. But.

抱歉，Bobby 是你問題的第二部分。我知道你問的是我們對第四場比賽的期望。但。

That, I think, no, like, I think you hit it there but maybe just as a follow up, right? So that got it was supposed to, the ring was supposed to happen like September 26. But then yourself, as well as the other producer's kind of send in some more information to kind of make your point of or make the point as to why it should go your way versus what the landowners were asking and maybe just any insights of like kind have because I mean, you guys are landowners as well, right? And so you guys do have that unique perspective. So maybe just any and I get, yeah, you can't, you know, you don't have, nobody has a crystal ball, right? But maybe just discuss kind of those documents that were submitted to the AOGC and maybe what you're hoping that what, what, what that highlights to them.

我認為，不，就像，我認為你說到了那裡但也許只是作為後續，對嗎？所以戒指本來應該在 9 月 26 日佩戴。但是您自己以及其他生產者可以發送更多信息來闡明您的觀點，或者闡明為什麼應該按照您的方式進行，而不是按照土地所有者的要求進行，也許只是任何類似的見解，因為我的意思是，您也是土地所有者，對吧？所以你們確實有獨特的視角。所以也許只是任何一個，我都明白，是的，你不能，你知道，你沒有，沒有人有水晶球，對吧？但也許只是討論一下提交給 AOGC 的那些文件，以及您希望向他們強調什麼。

Yeah, the only thing I will say about our standard lithium royalties, those are already set, those were negotiated in our option agreement with standard lithium. So, Tetra and we, this is public information Tetra will be getting 2.5% royalty off of any commercial lithium production that that standard lithium achieves. So, you know, in terms of the documents that were submitted. It's really, I would say more around the capital investment, the OpEx, you know, the things that need to be put in play to justify where we think the optimum royalty should be, which is less than 2.5, than the 2.5% that we have with standard lithium. But again, we'll see how that goes. I can't predict the outcome.

是的，我要說的關於我們的標準鋰使用費的唯一事情是，這些已經確定了，這些是在我們與標準鋰的選擇協議中協商的。因此，Tetra 和我們，這是公開訊息，Tetra 將從標準鋰實現的任何商業鋰生產中獲得 2.5% 的使用費。所以，您知道，就已提交的文件而言。實際上，我想說更多的是關於資本投資、營運支出，你知道，我們需要將這些因素納入考量，以證明我們認為最佳特許權使用費應該是多少，即低於 2.5%，而不是標準鋰的 2.5%。但我們還是看看事情進展如何。我無法預測結果。

And Bobby on that the last in the third quarter, a couple of items have been in favor of standard lithium that are very encouraging that they bring their production up. Number one, Ecuador, the National Oil Company essentially of Norway teamed up with them and then second standard lithium received a grant from the Department of Energy. So, I think those two incremental data points is very encouraging from a KTA perspective that standard lithium can produce lithium in the future. And the key part to us also remember is that standard lithium drills, well, to get the brine out to get to the lithium by default, they're bringing out the bromine, which then gives us an incremental source of bromine to feed our needs in the oil and gas and the battery storage market.

Bobby 表示，在第三季度，有幾項項目對標準鋰有利，這非常令人鼓舞，因為它們提高了產量。第一個是厄瓜多爾，挪威國家石油公司與他們合作，第二是鋰業，獲得了能源部的資助。因此，我認為從 KTA 的角度來看，這兩個增量數據點非常令人鼓舞，表明標準鋰將來可以生產鋰。我們還要記住的關鍵部分是，標準的鋰鑽，預設情況下，為了提取鹽水來獲取鋰，它們會提取溴，這為我們提供了增量的溴來源，以滿足我們在石油和天然氣以及電池儲存市場的需求。

Yeah.

是的。

Thank you for that clarity and reminder on that you guys have brought up, we've already said appreciate that. And then going to kind of jump to the next question you guys have talked extensively about the factors underpinning why you guys are going to need more bromine supply, right? And I think that's pretty well understood by the investor, investor community. And then in yesterday's release and you guys' prepared remarks, you got, you mentioned how you're now talking to Bromine suppliers to expand that supply in the near term prior to prior to Evergreen getting up and producing those production volumes. So, what I'm curious to hear on this, could you just give us some color as to why that's happening now versus maybe nine months ago? Because it seems like the factors underpinning the outlook haven't changed, but now you guys are going out to more supply.

謝謝你們提出的澄清和提醒，我們已經表達了感謝。然後跳到下一個問題，你們已經廣泛討論了為什麼你們需要更多的溴供應的根本因素，對嗎？我認為投資者和投資者群體都非常了解這一點。然後在昨天的發布會和你們準備好的發言中，你們提到了你們現在正在與溴供應商談判，以便在長榮開始生產這些產量之前在短期內擴大供應。所以，我很好奇，您能否為我們解釋為什麼現在會發生這種情況，而不是九個月前？因為看起來支撐前景的因素並沒有改變，但現在你們正在尋找更多的供應。

Yeah, I think, I think we, we just want to make sure we have some flexibility in, in you know, the way we look at how the, how the market evolves over the next couple of years. No, nothing has changed in terms of our demand for Bromine. That is, I would say we're probably as bullish on that as we have been since we started. But I think there are some options for us on the supply side given where the current market is right now as it relates to Bromine to be able to secure some additional Bromine supply, that gives us more flexibility on how we stage the capital investment that we have with Arkansas. And so that's somewhat attractive for us to take a look at. You know, we haven't concluded anything yet. We haven't published what the stage one of the Bromine project would look like yet. But obviously, we want to evaluate all of those before we make any final investment type decisions.

是的，我認為，我們只是想確保我們在看待未來幾年市場如何發展方面具有一定的靈活性。沒有，我們對溴的需求沒有任何改變。也就是說，我想說我們對此的態度可能和我們開始以來一樣樂觀。但我認為，考慮到目前市場與溴相關的狀況，在供應方面我們有一些選擇，能夠確保一些額外的溴供應，這使我們在如何安排與阿肯色州的資本投資方面擁有更大的靈活性。所以這對我們來說有一定的吸引力，值得一看。你知道，我們還沒有得出任何結論。我們尚未發布 Bromine 專案第一階段的具體內容。但顯然，我們希望在做出任何最終的投資類型決定之前對所有這些進行評估。

Okay. That makes really good sense. It's just not, nothing changing with the outlook still remains as strong as it was nine months ago. But now it's hey, maybe we're doing this in a staged manner, getting the evergreen up and, and so let's give a saw some flexibility that.

好的。這確實很有道理。事實並非如此，前景沒有任何變化，仍然像九個月前一樣強勁。但是現在，嘿，也許我們正在以階段性的方式進行此操作，讓常青樹長大，這樣我們就可以給鋸子一些靈活性。

That, that's exactly right. Yeah. Yeah.

那，那正是。是的。是的。

Got it. Thank you, Brady. And then just maybe last one for me. Could you, so I, guess you guys' already kind of, you mentioned the Deepwater Brazil project, obviously a lot of stuff happening in that region. And could you just maybe remind us like how you guys expanded your capacity in 2023 thereby like 80% right, do you think winning this job is kind of a result of that capacity expansion? Because now you guys can serve it and maybe just give it, maybe give some read through on if this then opens you, if this winning this job is going to then help you win other deepwater jobs, you know, of other countries near Brazil.

知道了。謝謝你，布雷迪。這也許對我來說是最後一個了。你能不能，我猜你們已經提到了深水巴西項目，顯然該地區發生了很多事情。您能否提醒我們一下，你們在 2023 年擴大了產能，從而擴大了 80%，你們認為贏得這份工作是產能擴張的結果嗎？因為現在你們可以為它服務，也許只是給它，也許給它一些閱讀，如果這為你打開了大門，如果贏得這個工作將幫助你贏得其他深水工作，你知道，巴西附近其他國家的。

Yeah, our investment in Brazil you know, we had anticipated the market moving towards some of these higher density completion fluids. Again, Brazil is one of the largest, if not the largest in terms of actual rig activity.

是的，我們在巴西的投資，我們預期市場將轉向一些更高密度的完井液。再者，從實際鑽井活動來看，巴西是最大的國家之一，甚至可以說是最大的。

But you know, a lot of the traditional deep water have not been the high, high temperature, high pressure type. You know, wells necessarily in the, that we see like similar in the Gulf of Mexico. We started to see some trends of some of the higher pressure requiring heavier brines a couple of years ago when we secured our first and several years deepwater contract. And so, we made that investment in additional capacity in anticipation of the market moving that way. So obviously, we're very pleased that it's worked out that way. So, yeah, we see more opportunity in Brazil, especially if, there's continuing shift to the heavy brines because that's where really touch it brings technology and value to the, the completion fluids markets.

但你知道，許多傳統的深水井並不屬於高溫、高壓類型。您知道，我們在墨西哥灣看到的油井必然與此類似。幾年前，當我們獲得第一份為期數年的深水合約時，我們開始看到一些更高壓力需要更重鹽水的趨勢。因此，我們預期市場將會朝這個方向發展，因此對額外產能進行了投資。顯然，我們很高興事情能夠如此順利。所以，是的，我們在巴西看到了更多的機會，特別是如果繼續轉向重質鹽水，因為這才是真正為完井液市場帶來技術和價值的地方。

Thank you very much guys on the color and congrats on the solid quarter. I'll return to the queue.

非常感謝你們對顏色的喜愛，並祝賀本季取得豐厚成績。我將回到隊列。

Your next question comes from Josh Jane with Daniel Energy Partners.

您的下一個問題來自 Daniel Energy Partners 的 Josh Jane。

Thanks, good morning. First question is just around automation technology across water and flowback services you guys alluded to. This is going to be one of the one of the driving factors behind how you can increase margins going forward. I just wondered if you could speak to the sense of urgency on behalf of your customers here, want to move towards further automation and your outlook for sort of their sense of urgency on that front into next year.

謝謝，早安。第一個問題是關於你們提到的水和回流服務的自動化技術。這將成為未來提高利潤率的驅動因素之一。我只是想知道您是否可以代表您的客戶談談緊迫感，希望進一步實現自動化，以及您對明年他們在這方面的緊迫感的展望。

Yeah, so we're seeing you know, very good customer acceptances of automation. You know, the one of the defining factors of our water and flowback business is traditionally, has been a fairly labour-intensive operation, people costs are the highest cost of this particular segment. And you're also putting people in the red zone often times, you know, well, heads under pressure, etc. So, there's a critical safety factor involved in this. And so, we realized a while back that in order for us to get the efficiency margins where we wanted to get the returns on the equipment, we were putting into place as was well address, you know, customer safety that that would be a very appealing to the customers. And, and we're seeing that so, you know, some customers will move faster on these types of things than others. But as again, an indication we have right now is we're pretty well sold-out maximum utilization with the automation equipment that we have in the field. But we are taking a staged approach, we'll probably do 20% per year until we automate the entire flowback technology. But it obviously if we see some demand from customers accelerating that or even wanting to put some money upfront for some of that, we'll, we'll consider that, but that's our, that's our plan today.

是的，我們看到客戶對自動化的接受度非常好。您知道，我們的水和回流業務的決定性因素之一是傳統上是一項相當勞力密集的業務，人力成本是這一特定領域中最高的成本。而且你也經常把人們置於危險區域，你知道，頭腦處於壓力之下，等等。因此，我們不久前就意識到，為了獲得我們想要的設備回報效率，我們正在實施並解決客戶安全問題，這對客戶來說非常有吸引力。而且，我們看到，有些客戶在這些事情上的行動會比其他客戶更快。但是，正如目前的情況所示，我們現場的自動化設備的最大利用率基本上已經售罄。但我們採取的是分階段的方法，我們可能每年實現 20%，直到實現整個回流技術的自動化。但很明顯，如果我們看到一些客戶的需求加速成長，甚至願意為其中的一些需求預先投入一些資金，我們會考慮，但這是我們今天的計劃。

Okay, thanks. And then for my follow up, I was hoping we could just talk about Tetra X a little bit more. I thought the release last week was pretty interesting when you talked about, you know what the total addressable market could be for oil and gas or what ultimately corrosion costs back in the study that was done in 2013. Could you just talk about when you would expect Tetra X to start contributing and then maybe give some framework around total addressable market as a standalone corrosion inhibitor, I think just would be interesting for some colour. Thanks.

好的，謝謝。然後作為我的後續回答，我希望我們可以多談論 Tetra X。我認為上週發布的消息非常有趣，您談到，在 2013 年的研究中，石油和天然氣的總目標市場可能是多少，或者最終的腐蝕成本是多少。您能否談談您預計 Tetra X 何時開始發揮作用，然後給出一些作為獨立腐蝕抑製劑的整體可尋址市場的框架，我認為這會很有趣。謝謝。

Yeah, we're right now we'll be marketing it blended with our completion fluids. And so, we think that's going to allow us to get a premium price again in high temperature and markets. And then the price that is estimating, I think 187 to 190 wells or so, that would qualify for high temperature wells next year. And so that's a pretty sizable market opportunity for us. We're not prepared yet to put any dollar numbers on what that will mean to us at this point in time. We're still in the early days of commercializing it, but we'll hope to be able to announce, you know, more colour on that. And in the in the future as far as outside of the oil and gas market, again, the attractive part of tetra X is the high temperature above, you know, 275 degrees is where tetra X value really comes into play. It significantly reduces corrosion compared to what else is in the market. So, we have to find markets that have that type of you know, temperature environment to where we will benefit from tetra X. Obviously, oil and gas wells is one of them. There are other markets that that we're looking at, but we're not prepared yet to be able to quantify.

是的，我們現在將它與我們的完井液混合進行行銷。因此，我們認為這將使我們在高溫市場再次獲得溢價。然後估算價格，我認為明年大約有 187 到 190 口井符合高溫井的條件。這對我們來說是一個相當大的市場機會。目前我們還沒有準備好用金錢來衡量這對我們意味著什麼。我們仍處於商業化的早期階段，但我們希望能夠宣布更多相關內容。而在未來，就石油和天然氣市場之外而言，Tetra X 最吸引人的地方還是在於其在高於 275 度的溫度下真正發揮其價值。與市場上其他產品相比，它顯著減少了腐蝕。所以，我們必須找到具有這種溫度環境的市場，以便我們從 tetra X 中受益。我們正在關注其他市場，但尚未準備好進行量化。

You know what we think that value would be outside of oil and gas.

您知道我們認為石油和天然氣以外的價值是多少嗎？

Next question comes from Jeff Silber with Efu.

下一個問題來自 Efu 的 Jeff Silber。

Hi, everyone. Thanks for taking my questions, really impressive margin management this quarter. I was just wondering, could you talk more about the pure flow electrolyte business with EOS energy? It sounds like you're all set with the processing capacity to meet anticipated demand next year. And I'm curious if you collaborate on the solution and how these sales are anticipated to influence your margins next year.

大家好。感謝您回答我的問題，本季的利潤管理確實令人印象深刻。我只是想知道，您能否進一步談談 EOS 能源的純流電解質業務？聽起來你們已經準備好滿足明年預期需求的處理能力了。我很好奇您是否就解決方案進行了合作，以及這些銷售預計會如何影響您明年的利潤率。

So, Jesse, if you recall, we started selling an ultra-high purity zinc bromide to EOS last year and we took our zinc bromide that we have historically used that in the oil and gas sector, we find it to a much higher level of purity parts per billion. And that was our initial engagement with EOS. Then we announced earlier this year in arrangement so that instead of just selling them pure flow, we would instead blend the full electrolyte for them, which means that we're buying products in the open market and blending it with pure flow and then shipping them the complete electrolyte. We started doing that in a small scale in the last couple of months. And we added blending capacity in West Memphis to take on those higher volumes. And now we're set to meet EOS demands as they complete their automation process and take it to that level. So at this point, we're prepared to meet their demands of either pure flow or the complete electrolyte. Once they're up and running with a fully automated line.

所以，傑西，如果你還記得的話，我們去年開始向 EOS 出售超高純度溴化鋅，並且我們採用了我們過去在石油和天然氣領域使用過的溴化鋅，我們發現它的純度達到了十億分之幾的更高水平。這就是我們與 EOS 的初次接觸。然後，我們在今年早些時候宣布了一項安排，這樣我們就不會僅僅向他們出售純流，而是為他們混合完整的電解質，這意味著我們在公開市場上購買產品並將其與純流混合，然後將完整的電解質運送給他們。我們在過去幾個月開始小規模地這樣做。我們在西孟菲斯增加了混合能力，以滿足更高的產量。現在，我們已準備好滿足 EOS 的需求，因為他們已完成自動化流程並將其提升到這一水平。所以此時，我們已準備好滿足他們對純流或完整電解質的需求。一旦他們啟動並運行全自動生產線。

Great.

偉大的。

And then on the margin front for the Business.

然後是關於業務的利潤方面。

Yeah, we won't comment on margins for any specific customer but assume that it's going to be consistent with what we're seeing in the oil and gas sector.

是的，我們不會對任何特定客戶的利潤率發表評論，但假設它將與我們在石油和天然氣行業看到的利潤率一致。

Next question comes from Dan Weston with West Cap management.

下一個問題來自 West Cap 管理公司的 Dan Weston。

Yeah. Hi, good morning, guys. Thanks for taking the questions and congrats on all the progress.

是的。大家早安。感謝您回答這些問題，並祝賀您取得的所有進展。

Last quarter, I think you mentioned that you were deploying your first sandstorm. If you can give a little guidance on how that trial is progressing and when you think a reasonable time frame for a final investment decision, there would be.

上個季度，我記得您提到您正在部署第一次沙塵暴。如果您能就該試驗的進展以及您認為最終投資決策的合理時間框架提供一些指導，那就太好了。

Sure Dan, I think we announced we had actually reached an agreement with a major Middle East National Oil company. And we have the agreement in place. We've actually had to make some modifications to our sandstorm to meet the the local requirements in that market. We've completed that we're delivering the sandstorm of this quarter. And so, the actual trials of 2025 hope that clarifies a little bit on the time.

當然可以，丹，我認為我們宣布我們已經與一家大型中東國家石油公司達成了協議。我們已經達成協議。事實上，我們必須對沙塵暴進行一些修改，以滿足該市場的當地需求。我們已經完成了本季的沙塵暴交付。因此，希望 2025 年的實際試驗能對時間做出一些澄清。

Oh, yeah thank you. Yeah, I may have missed that. Thanks for clarifying that and then lastly just relating to EOS comments relating to standard lithium in the DOE. Could you remind us has Tetra made a formal application for your DOE funding and any status update you can give would be appreciative.

噢，是的，謝謝。是的，我可能錯過了。感謝您澄清這一點，最後僅涉及與 DOE 標準鋰相關的 EOS 評論。您能否提醒我們 Tetra 是否已正式申請您的 DOE 資金，如果您能提供任何狀態更新資訊我們將不勝感激。

Yeah, we won't comment on whether we've submitted applications or not. We don't want all future calls to focus on is an application in the system for in the process. But assume that anything that's available out there that either qualifies us for battery production on the roaming side or on the lithium side that will work to try to take advantage of that. I hope that rather than try to communicate progress that we communicate success if we can get there.

是的，我們不會評論我們是否提交了申請。我們不希望所有未來的通話都集中在系統中的某個應用程式上。但是假設任何可用的東西，都可以讓我們有資格在漫遊方面或鋰方面進行電池生產，以嘗試利用這一點。我希望，我們不要試圖傳達進展，而是傳達如果我們能夠實現成功則取得的成功。

No, I get, I get it Yeah, thank you.

不，我明白，我明白了，是的，謝謝你。

Okay, that's all for me. I appreciate.

好的，我就說這麼多了。我很感激。

Thanks. Then again, if you have a question, please press star then one, this includes our question-and-answer session. I would like to turn the conference back over to Mr. Murphy for any closing remarks.

謝謝。再說一次，如果您有問題，請按星號然後按一，這包括我們的問答環節。我想將會議交還給墨菲先生，請他作最後發言。

Well, thank you, everyone. Really appreciate your interest in tetra and all the great questions. For now, we will conclude our call today. Thank you very much.

好吧，謝謝大家。非常感謝您對四極管的興趣以及提出的所有重要問題。現在，我們就結束今天的通話了。非常感謝。

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。