Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number 1-13455

TETRA Technologies, Inc.

(Exact name of registrant as specified in its charter)


Delaware			74-2148293
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification No.)

24955 Interstate 45 North
The Woodlands,
Texas			77380
(Address of Principal Executive Offices)			(Zip Code)

(281) 367-1983

(Registrant’s Telephone Number, Including Area Code)

_______________________________________________________________________

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	TTI	New York Stock Exchange
Preferred Share Purchase Right	N/A	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 27, 2023, there were 130,079,173 shares outstanding of the Company’s Common Stock, $0.01 par value per share.


TETRA Technologies, Inc. and Subsidiaries
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			Page
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations			1
Consolidated Statements of Comprehensive Income			2
Consolidated Balance Sheets			3
Consolidated Statements of Equity			5
Consolidated Statements of Cash Flows			7
Notes to Consolidated Financial Statements			8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			20
Item 3. Quantitative and Qualitative Disclosures about Market Risk			33
Item 4. Controls and Procedures			34

PART II—OTHER INFORMATION
Item 1. Legal Proceedings			35
Item 1A. Risk Factors			35
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			35
Item 3. Defaults Upon Senior Securities			35
Item 4. Mine Safety Disclosures			36
Item 5. Other Information			36
Item 6. Exhibits			37
SIGNATURES			38

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PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Operations

(In Thousands, Except Per Share Amounts)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenues:
Product sales	$	68,967	$	55,494	$	230,719	$	195,850
Services	82,497		79,518		242,417		209,915
Total revenues	151,464		135,012		473,136		405,765
Cost of revenues:
Cost of product sales	41,410		36,571		139,678		130,916
Cost of services	63,552		60,334		186,424		162,276
Depreciation, amortization, and accretion	8,578		8,634		25,705		24,061
Impairments and other charges	—		—		777		2,262
Insurance recoveries	—		—		(2,850)		(3,750)
Total cost of revenues	113,540		105,539		349,734		315,765
Gross profit	37,924		29,473		123,402		90,000
Exploration and pre-development costs	3,775		936		6,836		3,500
General and administrative expense	23,838		23,833		73,254		68,096
Interest expense, net	5,636		3,999		16,672		10,933


Other income, net	(2,041)		(1,410)		(8,690)		(4,858)
Income before taxes and discontinued operations	6,716		2,115		35,330		12,329
Provision for income taxes	1,248		2,178		5,612		2,899
Income (loss) before discontinued operations	5,468		(63)		29,718		9,430

Income (loss) from discontinued operations, net of taxes	(48)		319		(68)		270
Net income	5,420		256		29,650		9,700
Loss attributable to noncontrolling interests	—		22		25		43
Net income attributable to TETRA stockholders	$	5,420	$	278	$	29,675	$	9,743
Basic net income per common share:
Income from continuing operations	$	0.04	$	0.00	$	0.23	$	0.08

Net income attributable to TETRA stockholders	$	0.04	$	0.00	$	0.23	$	0.08
Weighted average basic shares outstanding	129,777		128,407		129,395		127,890
Diluted net income per common share:
Income from continuing operations	$	0.04	$	0.00	$	0.23	$	0.08

Net income attributable to TETRA stockholders	$	0.04	$	0.00	$	0.23	$	0.08
Weighted average diluted shares outstanding	132,089		128,407		130,835		129,704

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(In Thousands)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income	$	5,420	$	256	$	29,650	$	9,700
Foreign currency translation adjustment from continuing operations, net of taxes of $0 in 2023 and 2022	(2,750)		(3,873)		(284)		(7,095)
Unrealized gain (loss) on investment in CarbonFree	146		(306)		474		(306)
Comprehensive income (loss)	2,816		(3,923)		29,840		2,299
Less: Comprehensive loss attributable to noncontrolling interests	—		22		25		43
Comprehensive income (loss) attributable to TETRA stockholders	$	2,816	$	(3,901)	$	29,865	$	2,342

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands)


	September 30, 2023		December 31, 2022
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	33,826	$	13,592

Trade accounts receivable, net of allowances of $508 in 2023 and $538 in 2022	122,900		129,631
Inventories	92,128		72,113


Prepaid expenses and other current assets	21,575		23,112
Total current assets	270,429		238,448
Property, plant, and equipment:
Land and building	23,308		25,723
Machinery and equipment	309,082		318,693
Automobiles and trucks	10,379		11,832
Chemical plants	63,912		63,528
Construction in progress	4,461		7,660
Total property, plant, and equipment	411,142		427,436
Less accumulated depreciation	(305,063)		(325,856)
Net property, plant, and equipment	106,079		101,580
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization of $49,904 in 2023 and $46,996 in 2022	30,132		32,955


Operating lease right-of-use assets	34,227		33,818
Investments	16,405		14,286
Other assets	15,147		13,279
Total other assets	95,911		94,338
Total assets	$	472,419	$	434,366

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands, Except Share Amounts)


	September 30, 2023		December 31, 2022
	(Unaudited)
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable	$	50,322	$	49,121
Current portion of long-term debt	1,911		3
Compensation and employee benefits	31,090		30,958
Operating lease liabilities, current portion	8,745		7,795
Accrued taxes	10,777		9,913
Accrued liabilities and other	23,281		25,557
Current liabilities associated with discontinued operations	414		920
Total current liabilities	126,540		124,267
Long-term debt, net	156,748		156,455
Operating lease liabilities	28,013		28,108
Asset retirement obligations	14,132		13,671
Deferred income taxes	1,890		2,038

Other liabilities	3,959		3,430
Total long-term liabilities	204,742		203,702
Commitments and contingencies (Note 7)
Equity:
TETRA stockholders’ equity:
Common stock, par value 0.01 per share; 250,000,000 shares authorized at September 30, 2023 and December 31, 2022; 133,217,848 shares issued at September 30, 2023 and 131,800,975 shares issued at December 31, 2022	1,332		1,318
Additional paid-in capital	482,709		477,820
Treasury stock, at cost; 3,138,675 shares held at September 30, 2023 and December 31, 2022	(19,957)		(19,957)
Accumulated other comprehensive loss	(48,873)		(49,063)
Retained deficit	(272,818)		(302,493)
Total TETRA stockholders’ equity	142,393		107,625
Noncontrolling interests	(1,256)		(1,228)
Total equity	141,137		106,397
Total liabilities and equity	$	472,419	$	434,366

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Equity

(In Thousands)

(Unaudited)


	Common Stock Par Value		Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Income (Loss)				Retained Deficit		Noncontrolling Interest		Total Equity
							Currency Translation		Unrealized Gain (Loss) on Investment

Balance at December 31, 2022	$	1,318	$	477,820	$	(19,957)	$	(48,991)	$	(72)	$	(302,493)	$	(1,228)	$	106,397
Net income (loss) for first quarter 2023	—		—		—		—		—		6,040		(7)		6,033
Translation adjustment, net of taxes of $0	—		—		—		1,421		—		—		—		1,421
Other comprehensive income	—		—		—		—		121		—		—		121
Comprehensive income															7,575




Equity-based compensation(1)	—		3,514		—		—		—		—		—		3,514

Other	7		(1,341)		—		—		—		—		1		(1,333)
Balance at March 31, 2023	$	1,325	$	479,993	$	(19,957)	$	(47,570)	$	49	$	(296,453)	$	(1,234)	$	116,153
Net income (loss) for second quarter 2023	—		—		—		—		—		18,215		(18)		18,197
Translation adjustment, net of taxes of $0	—		—		—		1,045		—		—		—		1,045
Other comprehensive income	—		—		—		—		207		—		—		207
Comprehensive income															19,449



Equity-based compensation	—		1,507		—		—		—		—		—		1,507
Other	2		(52)		—		—		—		—		(2)		(52)
Balance at June 30, 2023	$	1,327	$	481,448	$	(19,957)	$	(46,525)	$	256	$	(278,238)	$	(1,254)	$	137,057
Net income for third quarter 2023	—		—		—		—		—		5,420		—		5,420
Translation adjustment, net of taxes of $0	—		—		—		(2,750)		—		—		—		(2,750)
Other comprehensive income	—		—		—		—		146		—		—		146
Comprehensive income															2,816



Equity-based compensation	—		1,396		—		—		—		—		—		1,396
Other	5		(135)		—		—		—		—		(2)		(132)
Balance at September 30, 2023	$	1,332	$	482,709	$	(19,957)	$	(49,275)	$	402	$	(272,818)	$	(1,256)	$	141,137

(1) Equity-based compensation for the three months ended March 31, 2023 includes $2.3 million for a portion of short-term incentive compensation that was settled through grants of restricted stock units rather than cash.

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	Common Stock Par Value		Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Loss				Retained Deficit		Noncontrolling Interest		Total Equity
							Currency Translation		Unrealized Gain (Loss) on Investment

Balance at December 31, 2021	$	1,301	$	475,624	$	(19,957)	$	(46,932)	$	—	$	(310,332)	$	(1,141)	$	98,563
Net income (loss) for first quarter 2022	—		—		—		—		—		7,720		(1)		7,719
Translation adjustment, net of taxes of $0	—		—		—		192		—		—		—		192
Comprehensive income															7,911



Equity compensation expense	—		1,104		—		—		—		—		—		1,104
Other	7		(673)		—		—		—		—		(10)		(676)
Balance at March 31, 2022	$	1,308	$	476,055	$	(19,957)	$	(46,740)	$	—	$	(302,612)	$	(1,152)	$	106,902
Net income (loss) for second quarter 2022	—		—		—		—		—		1,745		(20)		1,725
Translation adjustment, net of taxes of $0	—		—		—		(3,414)		—		—		—		(3,414)
Comprehensive loss															(1,689)



Equity compensation expense	—		1,159		—		—		—		—		—		1,159
Other	6		(833)		—		—		—		—		(9)		(836)
Balance at June 30, 2022	$	1,314	$	476,381	$	(19,957)	$	(50,154)	$	—	$	(300,867)	$	(1,181)	$	105,536
Net income (loss) for third quarter 2022	—		—		—		—		—		278		(22)		256
Translation adjustment, net of taxes of $0	—		—		—		(3,873)		—		—		—		(3,873)
Other comprehensive loss	—		—		—		—		(306)		—		—		(306)
Comprehensive loss															(3,923)



Equity compensation expense	—		1,098		—		—		—		—		—		1,098
Other	4		(949)		—		—		—		—		(10)		(955)
Balance at September 30, 2022	$	1,318	$	476,530	$	(19,957)	$	(54,027)	$	(306)	$	(300,589)	$	(1,213)	$	101,756

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In Thousands, Unaudited)


	Nine Months Ended September 30,
	2023		2022
Operating activities:
Net income	$	29,650	$	9,700
Reconciliation of net income to net cash provided by operating activities:
Depreciation, amortization, and accretion	25,705		24,061

Impairment and other charges	777		2,262
Loss on investments	157		159
Equity-based compensation expense	4,199		3,361
Provision for credit losses	190		31

Amortization and expense of financing costs	2,707		2,378
Insurance recoveries associated with damaged equipment	(2,850)		(3,750)





Gain on sale of assets	(432)		(980)
Provision (benefit) for deferred taxes	(805)		(66)
Other non-cash credits	(916)		(359)
Changes in operating assets and liabilities:
Accounts receivable	7,600		(16,661)
Inventories	(19,990)		(5,707)
Prepaid expenses and other current assets	1,313		(3,782)
Trade accounts payable and accrued expenses	2,893		17,069
Other	1,133		(1,768)
Net cash provided by operating activities	51,331		25,948
Investing activities:
Purchases of property, plant, and equipment, net	(30,240)		(32,678)

Proceeds from sale of property, plant, and equipment	658		1,489
Proceeds from insurance recoveries associated with damaged equipment	2,850		3,750
Purchase of investments	(350)		—
Other investing activities	(1,836)		(841)
Net cash used in investing activities	(28,918)		(28,280)
Financing activities:
Proceeds from credit agreements and long-term debt	97,384		1,695
Principal payments on credit agreements and long-term debt	(98,441)		(3,292)
Payments on financing lease obligations	(837)		(1,174)






Net cash used in financing activities	(1,894)		(2,771)
Effect of exchange rate changes on cash	(285)		(1,201)
Increase (decrease) in cash and cash equivalents	20,234		(6,304)


Cash and cash equivalents at beginning of period	13,592		31,551


Cash and cash equivalents at end of period	$	33,826	$	25,247

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 – ORGANIZATION, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization

We are an energy services and solutions company operating on six continents, focused on calcium chloride, completion fluids and associated products and services, comprehensive water management solutions, frac flowback, and production well testing. We were incorporated in Delaware in 1981 and are composed of two segments – Completion Fluids & Products Division and Water & Flowback Services Division. Unless the context requires otherwise, when we refer to “we,” “us,” and “our,” we are describing TETRA Technologies, Inc. and its subsidiaries on a consolidated basis.

Presentation

Our unaudited consolidated financial statements include the accounts of our wholly owned or controlled subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended September 30, 2023 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2023.

We have reflected the operations of our former Compression Division and Offshore Division as discontinued operations for all periods presented. See Note 2 - “Discontinued Operations” for further information. Unless otherwise noted, amounts and disclosures throughout these Notes to Consolidated Financial Statements relate solely to continuing operations and exclude all discontinued operations.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission (“SEC”) and do not include all information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2022 and notes thereto included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2023 (the “2022 Annual Report”).

Tax Benefits Preservation Plan

On February 28, 2023, the Board of Directors adopted a Tax Benefits Preservation Plan (the “Tax Plan”) designed to protect the availability of the Company’s net operating loss carryforwards (“NOLs”) and other tax attributes (collectively, the “Tax Attributes”), which may be utilized in certain circumstances to reduce the Company’s future income tax obligations. The Tax Plan is intended to reduce the likelihood that any changes in the Company’s investor base would limit the Company’s future use of its Tax Attributes as a result of the Company experiencing an “ownership change” 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 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).

In adopting the Tax Plan, the Board of Directors declared a dividend of one Series A Junior Participating Preferred Stock purchase right (the “Rights”) for each outstanding share of Common Stock pursuant to the terms of the Tax Plan. Initially, each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”) at a price of $20.00 per one one-thousandth of a share of Preferred Stock (the “Purchase Price”), subject to adjustment. The Rights will cause substantial dilution to a person or group that acquires 4.99% or more of the Common Stock (or to a person or group that already owns 4.99% or more of the Company’s Common Stock if

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such person or group acquires additional shares representing 2% of the Company’s then outstanding shares of Common Stock) without prior approval from the Board of Directors.

The Rights will expire at the earliest of: (i) the close of business on February 28, 2026 (the “Final Expiration Date”); (ii) the time at which the Rights are redeemed pursuant to the Tax Plan, (iii) the time at which the Rights are exchanged pursuant to the Tax Plan; (iv) the closing of any merger or other acquisition transaction involving the Company pursuant to an agreement as described in the penultimate paragraph of Section 1.3 of the Tax Plan; (v) the close of business on the effective date of the repeal of Section 382 of the Code if the Board determines that the Tax Plan is no longer necessary or desirable for the preservation of the Tax Attributes; or (vi) the close of business on the first day of a taxable year of the Company following a Board determination that no Tax Attributes may be carried forward or otherwise utilized.

The Tax Plan adopted by the Board of Directors is similar to plans adopted by other publicly held companies with significant NOLs or other substantial tax benefits and is not designed to prevent any action that the Board of Directors determines to be in the best interest of the Company and its stockholders. At the Company’s 2023 annual meeting of stockholders held on May 24, 2023, the Company’s stockholders ratified the adoption of the Tax Plan.

The Rights are in all respects subject to and governed by the provisions of the Tax Plan. The foregoing summary provides only a general description of the Tax Plan and does not purport to be complete. The Tax Plan, which specifies the terms of the Rights and includes as Exhibit A the Form of Certificate of Designation of Series A Junior Participating Preferred Stock of the Company and as Exhibit B the Form of Right Certificate, is attached to the Company’s Current Report on Form 8-K, which was filed with the SEC on March 1, 2023, as Exhibit 4.1 and is incorporated herein by reference. The foregoing summary should be read together with the entire Tax Plan and is qualified in its entirety by reference to the Tax Plan.

Mineral Resources Arrangement

We have rights to the brine underlying our approximately 40,000 gross acres of brine leases in the Smackover Formation in Southwest Arkansas, including rights to the bromine and lithium contained in the brine. We recognized approximately $3.8 million and $6.8 million of expense during the three-month and nine-month periods ended September 30, 2023, respectively, and $0.9 million and $3.5 million of expense during the three-month and nine-month periods ended September 30, 2022, respectively, for exploration and pre-development costs representing expenditures incurred to evaluate potential future development of our lithium and bromine properties in Arkansas. We are also party to agreements whereby Standard Lithium Ltd. (NYSE: SLI) (“Standard Lithium”) has the right to explore for, and an option to acquire the rights to produce and extract, lithium in our Arkansas leases and other potential resources in the Mojave region of California. Standard Lithium delivered a notice to exercise this option to acquire those lithium rights in our Arkansas leases on October 6, 2023.

In June 2023, we entered into a memorandum of understanding (“MOU”) with Saltwerx LLC (“Saltwerx”), an indirect wholly owned subsidiary of a Fortune 500 company, relating to a newly-proposed brine unit in the Smackover Formation in Southwest Arkansas and potential bromine and lithium production from brine produced from the unit. We filed an amended brine unit application (“the Application”) covering approximately 6,138 acres, which expands the size of the unit area and also combines brine acreage that was previously leased by each of TETRA and Saltwerx (“the Brine Unit”), with the Arkansas Oil & Gas Commission (“AOGC”). On September 26, 2023, the AOGC held a public hearing and unanimously approved our application to establish the Brine Unit. On October 17, 2023, the AOGC issued formal orders establishing the Brine Unit and integrating all unleased parties within the Brine Unit, subject to a 60-day statutory election period for each unleased party, to elect whether or not to participate and share in costs of development of the Brine Unit. If no such election is made within the election period, such unleased parties will be deemed integrated within the Brine Unit as described in the formal orders. The MOU includes provisions relating to: (i) initial brine ownership percentages within the Brine Unit, including the bromine and lithium contained in the brine, (ii) the transfer of certain leased acres outside the proposed Brine Unit from the Company to Saltwerx after the expiration of the 60-day election period, (iii) Saltwerx reimbursing the Company for certain expenses incurred by the Company to date regarding the development of leased acreage to be included in the Brine Unit, and (iv) an allocation of certain future costs for the drilling of a brine production test well and other development operations, including front-end engineering and design studies for bromine and lithium production facilities.

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Significant Accounting Policies

Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2022 included in our 2022 Annual Report. There have been no significant changes in our accounting policies or the application thereof during the third quarter of 2023.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications

Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of reclassifications was not significant to the prior year's overall presentation.

Foreign Currency Translation

We have designated the Euro, the British pound, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Canada, Brazil, and certain of our operations in Mexico, respectively. The United States dollar is the designated functional currency for all of our other non-U.S. operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the United States dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) losses are included in other (income) expense, net and totaled less than $0.1 million and $0.3 million during the three and nine months ended September 30, 2023, respectively, and $(1.1) million and $(2.7) million during the three and nine months ended September 30, 2022, respectively.

Fair Value Measurements

We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain investments. See Note 8 - “Fair Value Measurements” for further discussion. Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, including the impairment of long-lived assets (a Level 3 fair value measurement).

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Supplemental Cash Flow Information

Supplemental cash flow information is as follows:


	Nine Months Ended September 30,
	2023		2022
	(in thousands)
Interest paid	$	14,282	$	11,578
Income taxes paid	$	3,918	$	2,525

	September 30, 2023		December 31, 2022
	(in thousands)
Accrued capital expenditures	$	1,271	$	4,901

New Accounting Pronouncements

Standards adopted during 2023

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the previously-used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. On January 1, 2023, we adopted ASU 2016-13. The adoption of this standard did not have a material impact on our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. In December 2022, the FASB issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” During the three months ended June 30, 2023, our asset-based credit agreement and term credit agreement were amended to replace LIBOR and Eurodollar rates with the secured overnight financing rate (“SOFR”). There were no significant costs associated with the amendments and the amendments did not have a significant impact on our consolidated financial statements.

NOTE 2 – DISCONTINUED OPERATIONS

On March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division, consisting of our Offshore Services and Maritech segments. Our former Offshore Division is reported as discontinued operations for all periods presented. Our consolidated balance sheets and consolidated statements of operations report discontinued operations separate from continuing operations. Our consolidated statements of comprehensive income, statements of equity and statements of cash flows combine continuing and discontinued operations. Our loss from discontinued operations for the three and nine months ended September 30, 2023 consists primarily of general and administrative expense associated with our former Offshore Division. A summary of additional financial information related to our discontinued operations is as follows:

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Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands, unaudited)


	Three Months Ended September 30, 2022
	Offshore Services
Major classes of line items constituting income from discontinued operations




General and administrative expense	$	510


Pretax loss from discontinued operations	(510)
Pretax gain on disposal of discontinued operations	829
Total pretax income from discontinued operations	319



Income from discontinued operations attributable to TETRA stockholders	$	319


	Nine Months Ended September 30, 2022
	Offshore Services		Maritech		Total
Major classes of line items constituting income from discontinued operations

Cost of revenues	$	54	$	—	$	54


General and administrative expense	533		—		533

Other income, net	—		(28)		(28)
Pretax income (loss) from discontinued operations	(587)		28		(559)
Pretax gain on disposal of discontinued operations					829
Total pretax income from discontinued operations					270



Income from discontinued operations attributable to TETRA stockholders					$	270

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)


	September 30, 2023
	Offshore Services		Maritech		Total
	(unaudited)









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	—		95		95


Total liabilities associated with discontinued operations	$	319	$	95	$	414


	December 31, 2022
	Offshore Services		Maritech		Total









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	506		95		601


Total liabilities associated with discontinued operations	$	825	$	95	$	920

NOTE 3 – REVENUE FROM CONTRACTS WITH CUSTOMERS

Our contract asset balances, primarily associated with contractual invoicing milestones and/or customer documentation requirements, were $30.7 million and $33.1 million as of September 30, 2023 and December 31, 2022, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

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Unearned income includes amounts in which the Company was contractually allowed to invoice prior to satisfying the associated performance obligations. We are also party to agreements whereby Standard Lithium has the right to explore for, and an option to acquire the rights to produce and extract, lithium in our Arkansas leases and other potential resources in the Mojave region of California. The Company receives cash and stock of Standard Lithium under the terms of the arrangements. The cash and stock component of consideration received is initially recorded as unearned income based on the quoted market price at the time the stock is received, then recognized in income over the contract term. Unearned income balances were $4.0 million and $3.7 million as of September 30, 2023 and December 31, 2022, respectively, and vary based on the timing of (i) invoicing, (ii) performance obligations being met and (iii) the receipt of stock and cash from Standard Lithium. Unearned income is included in accrued liabilities and other in our consolidated balance sheets. During the three-month and nine-month periods ended September 30, 2023 and September 30, 2022, contract costs were not significant.

We recognized approximately $1.2 million and $1.6 million of revenue during the three-month and nine-month periods ended September 30, 2023, respectively, and $2.6 million and $1.7 million of revenue during the three-month and nine-month periods ended September 30, 2022, respectively, deferred in unearned income as of the beginning of the period. We also recognized approximately $0.7 million and $2.4 million of income during the three-month and nine-month periods ended September 30, 2023, respectively, and $0.9 million and $2.4 million of income during the three-month and nine-month periods ended September 30, 2022, respectively, related to the Standard Lithium arrangements deferred in unearned income as of the beginning of the period and included in other income, net in our consolidated statements of operations.

We disaggregate revenue from contracts with customers into Product Sales and Services within each segment, as noted in our two reportable segments in Note 10 - “Industry Segments.” In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in thousands)
Completion Fluids & Products
United States	$	36,484	$	30,261	$	115,167	$	103,449
International	36,726		28,902		125,307		103,706
	73,210		59,163		240,474		207,155
Water & Flowback Services
United States	67,877		67,641		204,446		182,059
International	10,377		8,208		28,216		16,551
	78,254		75,849		232,662		198,610




Total Revenue
United States	104,361		97,902		319,613		285,508
International	47,103		37,110		153,523		120,257
	$	151,464	$	135,012	$	473,136	$	405,765

NOTE 4 – INVENTORIES

Components of inventories as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023		December 31, 2022
	(in thousands)
Finished goods	$	79,689	$	60,481
Raw materials	4,313		3,734
Parts and supplies	6,622		6,432
Work in progress	1,504		1,466
Total inventories	$	92,128	$	72,113

Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling.

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NOTE 5 – INVESTMENTS

Our investments as of September 30, 2023 and December 31, 2022 consist of the following:


	September 30, 2023		December 31, 2022
	(in thousands)
Investment in CSI Compressco	$	7,228	$	6,967
Investment in CarbonFree	6,563		6,139
Investment in Standard Lithium	2,264		1,180
Other investments	350		—
Total Investments	$	16,405	$	14,286

Following the January 2021 sale of the general partner of CSI Compressco LP (“CSI Compressco”), we continue to own approximately 3.7% of the outstanding CSI Compressco common units (NASDAQ: CCLP) as of September 30, 2023.

We have an intellectual property joint development agreement in place with CarbonFree to evaluate potential new technologies. CarbonFree is a carbon capture company with patented technologies that capture CO2 and mineralize emissions to make commercial, carbon-negative chemicals. In December 2021, we invested $5.0 million in a convertible note issued by CarbonFree. Our exposure to potential losses by CarbonFree is limited to our investments and capitalized and accrued interest associated with the CarbonFree convertible note.

In addition, we are party to agreements whereby Standard Lithium has the right to explore for, and an option to acquire the rights to produce and extract, lithium in our Arkansas leases and other additional potential resources in the Mojave region of California. The Company receives cash and stock of Standard Lithium under the terms of the arrangements. The cash and stock component of consideration received is initially recorded as unearned income based on the quoted market price at the time the stock is received, then recognized in income over the contract term.

See Note 8 - “Fair Value Measurements” for further information.

NOTE 6 – LONG-TERM DEBT AND OTHER BORROWINGS

Consolidated long-term debt as of September 30, 2023 and December 31, 2022 consists of the following:


	Scheduled Maturity	September 30, 2023		December 31, 2022

		(in thousands)
Term Credit Agreement(1)	September 10, 2025	$	156,748	$	154,570
Asset-Based Credit Agreement(2)	May 31, 2025	—		1,885
Argentina Credit Agreement	October 19, 2023	1,900		—
Swedish Credit Facility	December 31, 2023	11		3
Total debt		158,659		156,458
Less current portion		(1,911)		(3)
Total long-term debt		$	156,748	$	156,455

(1) Net of unamortized discount of $2.5 million and $3.4 million as of September 30, 2023 and December 31, 2022, respectively, and net of unamortized deferred financing costs of $3.8 million and $5.1 million as of September 30, 2023 and December 31, 2022, respectively.

(2) Net of unamortized deferred financing costs of $1.1 million as of December 31, 2022. Deferred financing costs of $0.7 million as of September 30, 2023 were classified as other long-term assets on the accompanying consolidated balance sheet as there was no outstanding balance on our asset-based credit agreement.

Term Credit Agreement

As of September 30, 2023, we had $156.7 million outstanding, net of unamortized discounts and unamortized deferred financing costs under our term credit agreement (“Term Credit Agreement”). The Term Credit Agreement requires us to offer to prepay up to 50% of Excess Cash Flow (as defined in the Term Credit Agreement) from the most recent full fiscal year within five business days of filing our Annual Report. If our Leverage Ratio (as

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defined in the Term Credit Agreement) at year-end is less than 2.00 to 1.00, the prepayment requirement is decreased to 25%. If our Leverage Ratio at year-end is less than 1.50 to 1.00, then no prepayment is required.

The Term Credit Agreement was amended in June 2023 to remove references to LIBOR and Eurodollar rates. Borrowings under the Term Credit Agreement bear interest at a rate per annum equal to, at the option of TETRA, either (i) SOFR (subject to a 1% floor) plus a margin of 6.25% per annum or (ii) a base rate plus a margin of 5.25% per annum. As of September 30, 2023, the interest rate per annum on borrowings under the Term Credit Agreement is 11.68%. In addition to paying interest on the outstanding principal under the Term Credit Agreement, TETRA is required to pay a commitment fee in respect of the unutilized commitments at the rate of 1.0% per annum, paid quarterly in arrears based on utilization of the commitments under the Term Credit Agreement.

All obligations under the Term Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by a security interest for the benefit of the Term Lenders on substantially all of the personal property of TETRA and certain of its subsidiaries, the equity interests in certain domestic subsidiaries, and a maximum of 65% of the equity interests in certain foreign subsidiaries.

ABL Credit Agreement

As of September 30, 2023, our asset-based credit agreement (“ABL Credit Agreement”) provides for a senior secured revolving credit facility of up to $80.0 million, with a $20.0 million accordion. The credit facility is subject to a borrowing base determined monthly by reference to the value of inventory and accounts receivable, and includes a sublimit of $20.0 million for letters of credit, a swingline loan sublimit of $11.5 million, and a $15.0 million sub-facility subject to a borrowing base consisting of certain trade receivables and inventory in the United Kingdom.

As of September 30, 2023, we had no balance outstanding and $11.5 million in letters of credit and guarantees under our ABL Credit Agreement. Subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement that may limit borrowings, we had availability of $68.5 million under this agreement.

The ABL Credit Agreement was amended in May 2023 to remove references to LIBOR. Borrowings under the ABL Credit Agreement bear interest at a rate per annum equal to, at the option of TETRA, either (i) SOFR plus 0.10%, (ii) a base rate plus a margin based on a fixed charge coverage ratio, (iii) the Daily Simple Risk Free Rate plus 0.10%, or (iv) with respect to borrowings denominated in Sterling, the Daily Simple Risk Free Rate for Sterling plus 0.0326%. The base rate is determined by reference to the highest of (a) the prime rate of interest as announced from time to time by JPMorgan Chase Bank, N.A. (b) the Federal Funds Effective Rate (as defined in the ABL Credit Agreement) plus 0.5% per annum and (c) SOFR (adjusted to reflect any required bank reserves) for a one-month period on such day plus 1.0% per annum. In addition to paying interest on the outstanding principal under the ABL Credit Agreement, TETRA is required to pay a commitment fee in respect of the unutilized commitments at an applicable rate ranging from 0.375% to 0.5% per annum, paid monthly in arrears based on utilization of the commitments under the ABL Credit Agreement. TETRA is also required to pay a customary letter of credit fee equal to the applicable margin on LIBOR-based loans and fronting fees.

All obligations under the ABL Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by a security interest for the benefit of the ABL Lenders on substantially all of the personal property of TETRA and certain subsidiaries of TETRA, the equity interests in certain domestic subsidiaries, and a maximum of 65% of the equity interests in certain foreign subsidiaries.

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Argentina Credit Agreement

In January 2023, the Company entered into a revolving credit facility for certain working capital and capital expenditure needs for its subsidiary in Argentina (“Argentina Credit Facility”). As of September 30, 2023, we had $1.9 million outstanding and availability of $0.1 million under the Argentina Credit Agreement. Borrowings bear interest at a rate of 2.50% per annum. The Argentina Credit Facility was backed by a letter of credit under our ABL Credit Agreement, and expired and was repaid in October 2023.

Swedish Credit Facility

In January 2022, the Company entered into a revolving credit facility for seasonal working capital needs of subsidiaries in Sweden (“Swedish Credit Facility”). As of September 30, 2023, we had a nominal amount outstanding and availability of approximately $4.6 million under the Swedish Credit Facility. During each year, all outstanding loans under the Swedish Credit Facility must be repaid for at least 30 consecutive days. Borrowings bear interest at a rate of 2.95% per annum. The Swedish Credit Facility expires on December 31, 2023 and the Company intends to renew it annually.

Finland Credit Agreement

In January 2022, the Company also entered into an agreement guaranteed by certain accounts receivable and inventory in Finland (“Finland Credit Agreement”). As of September 30, 2023, there were $1.4 million of letters of credit outstanding against the Finland Credit Agreement. The Finland Credit Agreement expires on January 31, 2024 and the Company intends to renew it annually.

Covenants

Our credit agreements contain certain affirmative and negative covenants, including covenants that restrict the ability to pay dividends or other restricted payments. As of September 30, 2023, we are in compliance with all covenants under the credit agreements.

NOTE 7 – COMMITMENTS AND CONTINGENCIES

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

There have been no other material developments in our legal proceedings during the quarter ended September 30, 2023. For additional discussion of our legal proceedings, please see our 2022 Annual Report and Quarterly Report on Form 10-Q for the quarter ended June 30, 2023.

Product Purchase Obligations

In the normal course of our Completion Fluids & Products Division operations, we enter into supply agreements with certain manufacturers of various raw materials and finished products. Some of these agreements have terms and conditions that specify a minimum or maximum level of purchases over the term of the agreement. Other agreements require us to purchase the entire output of the raw material or finished product produced by the manufacturer. Our purchase obligations under these agreements apply only with regard to raw materials and finished products that meet specifications set forth in the agreements. We recognize a liability for the purchase of such products at the time we receive them. As of September 30, 2023, the aggregate amount of the fixed and determinable portion of the purchase obligation pursuant to our Completion Fluids & Products Division’s supply agreements was approximately $74.9 million, including $4.0 million for the remainder of 2023, $24.0 million in 2024, $21.9 million in 2025, $15.6 million in 2026, $7.1 million in 2027, and $2.3 million thereafter, extending through 2028.

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NOTE 8 – FAIR VALUE MEASUREMENTS

Financial Instruments

Investments

We retained an interest in CSI Compressco representing approximately 3.7% of CSI Compressco’s outstanding common units as of September 30, 2023. In December 2021, we invested in a $5.0 million convertible note issued by CarbonFree. In addition, we receive cash and stock of Standard Lithium under the terms of our arrangements as noted in Note 5 - “Investments.”

Our investments in CSI Compressco and Standard Lithium are recorded in investments on our consolidated balance sheets based on the quoted market stock price (Level 1 fair value measurements). The stock component of consideration received from Standard Lithium is initially recorded as unearned income based on the quoted market price at the time the stock is received, then recognized in income over the contract term. Changes in the value of stock are recorded in other (income) expense, net in our consolidated statements of operations.

Our investment in convertible notes issued by CarbonFree is recorded in our consolidated financial statements based on an internal valuation with assistance from a third-party valuation specialist (Level 3 fair value measurement). The valuation is impacted by key assumptions, including the assumed probability and timing of potential debt or equity offerings. The convertible note includes an option to convert the note into equity interests issued by CarbonFree. The change in the fair value of the embedded option is included in other (income) expense, net in our consolidated statements of operations. The change in the fair value of the convertible note, excluding the embedded option, is included in other comprehensive income (loss) in our consolidated statements of comprehensive income. The change in our investment in CarbonFree for the nine-month period ended September 30, 2023 is as follows:


	Nine Months Ended September 30, 2023
	(in thousands)
Balance at beginning of period	$	6,139
Change in fair value of embedded option	(50)
Change in fair value of convertible note, excluding embedded option	474
Balance at end of period	$	6,563

Recurring fair value measurements by valuation hierarchy as of September 30, 2023 and December 31, 2022 are as follows:


			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	September 30, 2023		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	7,228	$	7,228	$	—	$	—
Investment in CarbonFree	6,563		—		—		6,563
Investment in Standard Lithium	2,264		2,264		—		—
Other investments	350		—		—		350

Total investments	$	16,405

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			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	December 31, 2022		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	6,967	$	6,967	$	—	$	—
Investment in CarbonFree	6,139		—		—		6,139
Investment in Standard Lithium	1,180		1,180		—		—

Investments	$	14,286

Impairments

During the second quarter of 2023, we recorded a $0.8 million impairment of our corporate office lease. The fair values were estimated based on the discounted cash flows from our lease and sublease agreements, including the rent rate per square foot (a Level 3 fair value measurement) in accordance with the fair value hierarchy.

Other

The fair values of cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, short-term borrowings and long-term debt pursuant to our Term Credit Agreement, ABL Credit Agreement, Argentina Credit Agreement, and Swedish Credit Agreement approximate their carrying amounts. See Note 6 - “Long-Term Debt and Other Borrowings” for further discussion.

NOTE 9 – NET INCOME PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income per common and common equivalent share:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
	(in thousands)
Number of weighted average common shares outstanding	129,777	128,407	129,395	127,890
Assumed vesting of equity awards	2,312	—	1,440	1,814
Average diluted shares outstanding	132,089	128,407	130,835	129,704

The average diluted shares outstanding excludes the impact of certain outstanding equity awards of 1.5 million shares for the three-month period ended September 30, 2022 as the inclusion of these shares would have been anti-dilutive due to the net loss from continuing operations recorded during this period.

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NOTE 10 – INDUSTRY SEGMENTS

We manage our operations through two segments: Completion Fluids & Products Division and Water & Flowback Services Division.

Summarized financial information concerning the business segments is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	68,532	$	55,354	$	228,415	$	195,469
Water & Flowback Services Division	435		140		2,304		381
Consolidated	$	68,967	$	55,494	$	230,719	$	195,850

Services
Completion Fluids & Products Division	$	4,678	$	3,809	$	12,059	$	11,686
Water & Flowback Services Division	77,819		75,709		230,358		198,229
Consolidated	$	82,497	$	79,518	$	242,417	$	209,915

Total revenues
Completion Fluids & Products Division	$	73,210	$	59,163	$	240,474	$	207,155
Water & Flowback Services Division	78,254		75,849		232,662		198,610
Consolidated	$	151,464	$	135,012	$	473,136	$	405,765

Income (loss) before taxes and discontinued operations
Completion Fluids & Products Division	$	16,932	$	12,357	$	67,330	$	46,910
Water & Flowback Services Division	8,475		6,482		22,869		10,808
Interdivision Eliminations	—		3		—		9
Corporate Overhead(1)	(18,691)		(16,727)		(54,869)		(45,398)
Consolidated	$	6,716	$	2,115	$	35,330	$	12,329

(1) Amounts reflected include the following general corporate expenses:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
General and administrative expense	$	13,552	$	11,968	$	37,206	$	33,856
Depreciation and amortization	101		165		303		528
Impairments and other charges	—		—		777		—
Interest expense	5,755		4,437		17,029		11,978

Other general corporate (income) expense, net	(717)		157		(446)		(964)
Total	$	18,691	$	16,727	$	54,869	$	45,398

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and accompanying notes included in this Quarterly Report. In addition, the following discussion and analysis should also be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on February 27, 2023 (“2022 Annual Report”). This discussion includes forward-looking statements that involve certain risks and uncertainties.

Business Overview

We are an energy services and solutions company operating on six continents, focused on calcium chloride, completion fluids and associated products and services, comprehensive water management solutions, frac flowback, and production well testing. Calcium chloride is used in the oil and gas industry, and also has broad industrial applications to the agricultural, road, food and beverage and lithium production markets. We are composed of two segments – Completion Fluids & Products Division and Water & Flowback Services Division.

Consolidated revenue for the first nine months of 2023 of $473.1 million reflects a 16.6% increase over the prior year, reflecting growth in international markets and the Gulf of Mexico, as well as a strong second quarter for our Northern Europe industrial chemicals business. Our strong results for the first nine months of 2023 reflect our employees delivering operational and financial excellence in our core businesses while simultaneously advancing our key strategic initiatives. Third-quarter consolidated revenue of $151.5 million reflects a 13.7% decrease following the strong Northern European industrial chemical business seasonal peak in the second quarter.

Completion Fluids & Products Division revenues for the first nine months of 2023 increased 16.1% compared to 2022 as pricing and market share have continued to improve. Completion Fluids & Products Division revenues decreased 25% sequentially, following a new segment record high during the second quarter, including the seasonal peak for our Northern Europe industrial chemicals business. Our offshore results declined compared to the second quarter as projects were completed or shifted into the fourth quarter.

Our Water & Flowback Services revenues remained stable compared to the second quarter of 2023 and improved slightly compared to the prior year, driven primarily by the first two early production facilities in Latin America that became operational in the third quarter of 2022 and the third early production facility which became operational in May 2023. Our growing fleet of TETRA SandStormTM advanced cyclone technology separators also remains at high utilization with continued market penetration and positive pricing progression. Water & Flowback Services margins have continued to improve, reflecting ongoing automation and cost-reduction initiatives.

We are committed to pursuing low-carbon energy initiatives that leverage our fluids and aqueous chemistry core competencies, our significant bromine and lithium assets and technologies, and our leading calcium chloride production capabilities. In June 2023, we entered into a memorandum of understanding (“MOU”) with Saltwerx LLC (“Saltwerx”), an indirect wholly owned subsidiary of a Fortune 500 company, relating to a newly-proposed brine unit in the Smackover Formation in Southwest Arkansas and potential bromine and lithium production from brine produced from the unit. We filed an amended brine unit application (the “Application”) covering approximately 6,138 acres, which expands the size of the unit area and also combines brine acreage that was previously leased by each of TETRA and Saltwerx (the “Brine Unit”), with the Arkansas Oil & Gas Commission (“AOGC”). On September 26, 2023, the AOGC held a public hearing and unanimously approved our application to establish the Brine Unit. We completed the evaluation of results from the second exploratory well on our acreage in Arkansas in the third quarter with exceptional results. These results are being used to update the lithium and bromine resource report which we plan to complete and release in the fourth quarter. Additional steps are required before making a decision to develop the bromine assets and include further studies to analyze the resource as well as completion of a pre-feasibility and/or feasibility study.

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Results of Operations

The following information should be read in conjunction with the Consolidated Financial Statements and the associated Notes contained elsewhere in this report. The analysis herein reflects the optional approach to discuss results of operations on a sequential-quarter basis, which we believe provides information that is most useful in assessing our quarterly results of operations.

Three months ended September 30, 2023 compared with three months ended June 30, 2023.

Consolidated Comparisons


	Three Months Ended						Period to Period Change
	September 30,			June 30,			$ Change		% Change
	2023			2023
	(in thousands, except percentages)
Revenues	$	151,464		$	175,463		$	(23,999)	(13.7)	%
Gross profit	37,924			49,155			(11,231)		(22.8)	%
Gross profit as a percentage of revenue	25.0		%	28.0		%
Exploration and pre-development costs	3,775			2,341			1,434		61.3	%
General and administrative expense	23,838			26,225			(2,387)		(9.1)	%
General and administrative expense as a percentage of revenue	15.7		%	14.9		%
Interest expense, net	5,636			5,944			(308)		(5.2)	%

Other income, net	(2,041)			(6,435)			(4,394)		(68.3)	%
Income before taxes and discontinued operations	6,716			21,080			(14,364)		(68.1)	%
Income before taxes and discontinued operations as a percentage of revenue	4.4		%	12.0		%
Provision for income taxes	1,248			2,875			(1,627)		(56.6)	%
Income before discontinued operations	5,468			18,205			(12,737)		(70.0)	%
Discontinued operations:
Loss from discontinued operations, net of taxes	(48)			(8)			40		500.0	%
Net income	5,420			18,197			(12,777)		(70.2)	%
Loss attributable to noncontrolling interests	—			18			(18)		100.0	%
Net income attributable to TETRA stockholders	$	5,420		$	18,215		$	(12,795)	(70.2)	%

Consolidated revenues decreased between the current and previous quarters primarily due to a decrease in overall activity for the Completion Fluids & Products division sales volume from the strong Northern European industrial chemical seasonality impact each year on our results in the second quarter. See Divisional Comparisons section below for a more detailed discussion of the change in our revenues.

Consolidated gross profit as a percentage of revenue decreased primarily due to our Completion Fluids & Products division lower overall activity levels and margins. See Divisional Comparisons section below for additional discussion.

Consolidated exploration and pre-development costs increased primarily due to costs associated with the lithium front-end engineering and design study and appraisal costs for the second exploratory brine well in Arkansas.

Consolidated general and administrative expenses decreased compared to the prior quarter, primarily due to a $1.3 million decrease in provision for credit losses as a provision established in the second quarter was reversed in the third quarter following improved collections, a $0.4 million decrease in general expenses and a $0.3 million decrease in legal expenses.

Consolidated other income, net, decreased in the current quarter, compared to the prior quarter primarily due to the $2.8 million decrease in credits for exploration and pre-development costs reimbursable from Saltwerx following the cumulative credit in the second quarter, and a $2.0 million increase in unrealized losses from our

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Standard Lithium shares received in April 2022 and 2023, partially offset by a $0.5 million increase in unrealized gain due to the change in the unit price of the CSI Compressco common units we own.

Consolidated provision for income tax was $1.2 million during the current quarter, compared to a $2.9 million provision during the prior quarter. Our consolidated effective tax rate for the three months ended September 30, 2023 was 18.6% due to income generated during the quarter, partially offset by the utilization of net operating loss carryforwards in the United States and certain other non-U.S. jurisdictions for which a valuation allowance had been established. We establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Included in our deferred tax assets are net operating loss carryforwards and tax credits that are available to offset future income tax liabilities in the United States and certain other non-U.S. jurisdictions.

Divisional Comparisons

Completion Fluids & Products Division


	Three Months Ended						Period to Period Change
	September 30,			June 30,			$ Change		% Change
	2023			2023
	(in thousands, except percentages)
Revenues	$	73,210		$	98,222		$	(25,012)	(25.5)	%
Gross profit	25,327			37,133			(11,806)		(31.8)	%
Gross profit as a percentage of revenue	34.6		%	37.8		%
Exploration and pre-development costs	3,775			2,341			1,434		61.3	%
General and administrative expense	5,829			8,551			(2,722)		(31.8)	%
General and administrative expense as a percentage of revenue	8.0		%	8.7		%
Interest (income) expense, net	(309)			104			(413)		397.1	%
Other income, net	(900)			(5,819)			(4,919)		(84.5)	%
Income before taxes and discontinued operations	$	16,932		$	31,956		$	(15,024)	(47.0)	%
Income before taxes and discontinued operations as a percentage of revenue	23.1		%	32.5		%

Revenues for our Completion Fluids & Products Division decreased primarily due to decreased volumes for industrial chemical sales following the seasonal uplift in Northern Europe in the prior quarter, as well as timing of customer completion schedules, which resulted in some planned offshore activity pushing from the third to the fourth quarter.

Gross profit for our Completion Fluids & Products Division decreased compared to the prior quarter primarily due to the decline in revenues mentioned above. Our profitability in future periods will continue to be affected by the mix of our products and services, market demand for our products and services, and drilling and completions activity.

Completion Fluids & Products Division exploration and pre-development costs associated with our potential Southwest Arkansas bromine development project increased $1.4 million due to costs associated with the lithium front-end engineering and design study and well appraisal costs. General and administrative expense for the division decreased $2.7 million, primarily due to a $1.3 million decrease in provision for credit losses as a provision established in the second quarter was reversed in the third quarter following improved collections, and a $1.3 million decrease in short-term incentive compensation expense. Other income, net decreased primarily due to the $2.8 million decrease in credits for exploration and pre-development costs from Saltwerx following the cumulative credit in the second quarter, and a $2.0 million increase in unrealized losses from our investment in Standard Lithium shares due to a decline in the share price.

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Water & Flowback Services Division


	Three Months Ended						Period to Period Change
	September 30,			June 30,			$ Change		% Change
	2023			2023
	(in thousands, except percentages)
Revenues	$	78,254		$	77,241		$	1,013	1.3	%
Gross profit	12,697			12,893			(196)		(1.5)	%
Gross profit as a percentage of revenue	16.2		%	16.7		%
General and administrative expense	4,457			5,080			(623)		(12.3)	%
General and administrative expense as a percentage of revenue	5.7		%	6.6		%

Interest expense, net	190			27			163		603.7	%
Other (income) expense, net	(425)			(228)			197		(86.4)	%
Income before taxes and discontinued operations	$	8,475		$	8,014		$	461	5.8	%
Income before taxes and discontinued operations as a percentage of revenue	10.8		%	10.4		%

Revenues for our Water & Flowback Services Division in the current quarter increased due to continued higher revenues from our early production facilities in Latin America following completion of the third facility in May 2023. The North America onshore business revenue was relatively flat compared to the prior quarter.

Gross profit for our Water & Flowback Services Division remained comparable to the previous quarter. Gross profit as a percentage of revenue also remained comparable reflecting the ongoing margin expansion efforts driven by investments in technology, integration, digitalization and the benefit of our early production facilities in Argentina. While we have seen some signs of softness in certain land segments in the United States, pricing has remained relatively stable for our differentiated products and service offerings.

The Water & Flowback Services Division income before taxes and discontinued operations increased primarily due to a $0.6 million decrease in general and administrative expense primarily due to cost reduction initiatives, partially offset by a $0.2 million increase in interest expense due to borrowings under the Argentina Credit Agreement.

Corporate Overhead


	Three Months Ended				Period to Period Change
	September 30,		June 30,		$ Change		% Change
	2023		2023
	(in thousands, except percentages)
Depreciation and amortization	$	101	$	93	$	8	8.6	%
Impairments and other charges	—		777		(777)		(100.0)	%
General and administrative expense	13,552		12,595		957		7.6	%
Interest expense, net	5,755		5,813		(58)		(1.0)	%

Other income, net	(717)		(388)		329		84.8	%
Loss before taxes and discontinued operations	$	(18,691)	$	(18,890)	$	199	(1.1)	%

Corporate overhead loss before taxes and discontinued operations remained comparable to the prior quarter as the $1.0 million increase in general and administrative expense primarily due to higher long-term incentive expenses was substantially offset by the $0.8 million impairment associated with our corporate office lease during the prior quarter.

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Nine months ended September 30, 2023 compared with nine months ended September 30, 2022.

Consolidated Comparisons


	Nine Months Ended
	September 30,						Period to Period Change
	2023			2022			$ Change		% Change
	(in thousands, except percentages)
Revenues	$	473,136		$	405,765		$	67,371	16.6	%
Gross profit	123,402			90,000			33,402		37.1	%
Gross profit as a percentage of revenue	26.1		%	22.2		%
Exploration and pre-development costs	6,836			3,500			3,336		95.3	%
General and administrative expense	73,254			68,096			5,158		7.6	%
General and administrative expense as a percentage of revenue	15.5		%	16.8		%
Interest expense, net	16,672			10,933			5,739		52.5	%

Other income, net	(8,690)			(4,858)			3,832		78.9	%
Income before taxes and discontinued operations	35,330			12,329			23,001		186.6	%
Income before taxes and discontinued operations as a percentage of revenue	7.5		%	3.0		%
Provision for income taxes	5,612			2,899			2,713		93.6	%
Income before discontinued operations	29,718			9,430			20,288		215.1	%
Discontinued operations:
(Income) loss from discontinued operations, net of taxes	(68)			270			338		NM(1)
Net income	29,650			9,700			19,950		205.7	%
Loss attributable to noncontrolling interests	25			43			(18)		(41.9)	%
Net income attributable to TETRA stockholders	$	29,675		$	9,743		$	19,932	204.6	%

(1) Percent change is not meaningful

Consolidated revenues increased in the current year primarily due to improving industry conditions compared to the prior year for both our Completion Fluids & Products and Water & Flowback Services divisions, as well as the first two early production facilities in Argentina that commenced operations in the third quarter of 2022 and a third early production facility that became operational in the second quarter of 2023. See Divisional Comparisons section below for a more detailed discussion of the change in our revenues.

Consolidated gross profit increased in the current year primarily due to the increase in revenue, partially offset by an increase in costs associated with the higher Water & Flowback Services division activity levels described above. Profit margins for both divisions also improved due to stronger market conditions, a shift to higher-margin projects as well as price improvements and cost reduction initiatives.

Consolidated exploration and pre-development costs increased $3.3 million compared to the prior year primarily due to costs associated with the lithium front-end engineering and design study and drilling and appraisal costs associated with our second exploratory brine well in Arkansas.

Consolidated general and administrative expenses increased compared to the prior year, primarily due to $5.4 million of increased wage and benefit-related expenses driven by divisional headcount additions and higher operational activity levels, as well as higher short and long-term incentive expense, including the impact of the increase in our stock price on long-term incentive awards.

Consolidated interest expense, net, increased in the current year primarily due to an increase in the interest rate on our Term Credit Agreement and increased interest on borrowings under our ABL Credit Agreement and Argentina Credit Agreement.

Consolidated other income, net, increased in the current year, compared to the prior year primarily due to $6.7 million credits for exploration and pre-development costs reimbursable from Saltwerx under the MOU entered in in June 2023, offset by a $3.0 million decrease in foreign exchange gains.

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Consolidated provision for income taxes was $5.6 million during the current year, compared to $2.9 million during the prior year. Our consolidated effective tax rate for the current year was 15.9%, compared to 23.5% during the prior year. The increase in our tax provision compared to the prior year was primarily due to the increase in income, while our effective tax rate decreased because a significant portion of the increase in income was in jurisdictions for which we were able to utilize net operating losses for which we had established valuation allowances. We establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Included in our deferred tax assets are net operating loss carryforwards and tax credits that are available to offset future income tax liabilities in the United States as well as in certain non-U.S. jurisdictions.

Divisional Comparisons

Completion Fluids & Products Division


	Nine Months Ended
	September 30,						Period to Period Change
	2023			2022			$ Change		% Change
	(in thousands, except percentages)
Revenues	$	240,474		$	207,155		$	33,319	16.1	%
Gross profit	87,469			66,726			20,743		31.1	%
Gross profit as a percentage of revenue	36.4		%	32.2		%
Exploration and pre-development costs	6,836			3,500			3,336		95.3	%
General and administrative expense	21,553			18,517			3,036		16.4	%
General and administrative expense as a percentage of revenue	9.0		%	8.9		%
Interest income, net	(600)			(1,042)			(442)		(42.4)	%
Other income, net	(7,650)			(1,159)			6,491		NM(1)
Income before taxes and discontinued operations	$	67,330		$	46,910		$	20,420	43.5	%
Income before taxes and discontinued operations as a percentage of revenue	28.0		%	22.6		%

(1) Percent change is not meaningful

Revenues for our Completion Fluids & Products Division increased compared to the prior year primarily due to higher European industrial chemical sales volumes, as well as favorable pricing and customer mix. The division also benefited from recent capacity expansions following investments in Brazil, the Gulf of Mexico and the United Kingdom.

Gross profit for our Completion Fluids & Products Division increased compared to the prior year due to an increase in revenues. Gross profit as a percentage of revenue for our Completion Fluids & Products division increased primarily due to favorable pricing improvements. Our profitability in future periods will continue to be affected by the mix of our products and services, market demand for our products and services, and drilling and completions activity.

Income before taxes and discontinued operations for our Completion Fluids & Products Division increased compared to the prior year driven by higher gross profit, $6.7 million of credits for exploration and pre-development costs reimbursable from Saltwerx as well as a $0.4 million decrease in unrealized losses from our investment in Standard Lithium shares, both included in other income, net. These increases were partially offset by a $3.3 million increase in costs associated with the exploratory brine project compared to the prior year; a $3.0 million increase in general and administrative costs due to higher compensation and short-term incentive expense due to increased activity levels and strong results; and a $0.8 million decrease in unrealized gains from the change in fair value of the CarbonFree convertible note embedded option.

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Water & Flowback Services Division


	Nine Months Ended
	September 30,						Period to Period Change
	2023			2022			$ Change		% Change
	(in thousands, except percentages)
Revenues	$	232,662		$	198,610		$	34,052	17.1	%
Gross profit	37,012			23,793			13,219		55.6	%
Gross profit as a percentage of revenue	15.9		%	12.0		%
General and administrative expense	14,496			15,724			(1,228)		(7.8)	%
General and administrative expense as a percentage of revenue	6.2		%	7.9		%
Interest (income) expense, net	243			(3)			246		NM(1)
Other income, net	(596)			(2,736)			(2,140)		(78.2)	%
Income before taxes and discontinued operations	$	22,869		$	10,808		$	12,061	111.6	%
Income before taxes and discontinued operations as a percentage of revenue	9.8		%	5.4		%

(1) Percent change is not meaningful

Revenues for our Water & Flowback Services Division increased significantly for both water management and production testing due to overall higher customer drilling and completion activity. Customer activity levels have continued to improve, primarily in our North America land business. Revenues have also increased in Latin America due to two early production facilities that began operations in the third quarter of 2022 and a third early production facility that became operational in the second quarter of 2023.

Gross profit for our Water & Flowback Services Division improved substantially from the prior year primarily due to higher revenues resulting from the increased activity levels described above and pricing improvements, and a shift to higher margin projects as well as continuous efforts to increase margins through streamlining operations and automation.

Income before taxes and discontinued operations for our Water & Flowback Services Division increased in the current year primarily due to an improvement in the gross profit described above and a $1.2 million decrease in general and administrative expense from cost reduction initiatives, partially offset by a $1.6 million decrease in foreign exchange gains and a $0.7 million decrease in gains on asset sales.

Corporate Overhead


	Nine Months Ended
	September 30,				Period to Period Change
	2023		2022		$ Change		% Change
	(in thousands, except percentages)
Depreciation and amortization	$	303	$	528	$	(225)	(42.6)	%
Impairments and other charges	777		—		777		100.0	%
General and administrative expense	37,206		33,856		3,350		9.9	%
Interest expense, net	17,029		11,978		5,051		42.2	%
Other income, net	(446)		(964)		518		53.7	%
Loss before taxes and discontinued operations	$	(54,869)	$	(45,398)	$	(9,471)	20.9	%

Corporate overhead loss before taxes and discontinued operations increased due to a $5.1 million increase in interest expense, net due to an increase in the interest rate on our Term Credit Agreement and higher borrowings under our ABL Credit Agreement, and a $3.4 million increase in general and administrative expense as well as a $0.5 million decrease in other (income) expense, net and a $0.8 million impairment of our corporate office lease. Corporate general and administrative expenses increased compared to the prior year, primarily due to increased wage and benefit-related expenses to support higher activity levels and higher equity-based compensation expense, including the impact of the increase in our stock price. Other (income) expense, net decreased primarily

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due to a $1.4 million decrease in foreign exchange gains, partially offset by a $0.4 million increase in unrealized gains related to unit price changes of our investment in CSI Compressco.

Non-GAAP Financial Measures

We use U.S. GAAP financial measures such as revenues, gross profit, income (loss) before taxes and discontinued operations, and net cash provided by operating activities, as well as certain non-GAAP financial measures, including Adjusted EBITDA, as performance measures for our business.

Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) before taxes and discontinued operations, excluding impairments, exploration and pre-development costs, certain special, non-recurring or other charges (or credits), interest, depreciation and amortization, income from collaborative arrangement and certain non-cash items such as equity-based compensation expense. The most directly comparable GAAP financial measure is net income (loss) before taxes and discontinued operations. Exploration and pre-development costs represent expenditures incurred to evaluate potential future development of TETRA’s lithium and bromine properties in Arkansas. Such costs include exploratory drilling and associated engineering studies. Income from collaborative arrangement represents the portion of exploration and pre-development costs that are reimbursable by our strategic partner. Exploration and pre-development costs and the associated income from collaborative arrangement are excluded from Adjusted EBITDA because they do not relate to the Company’s current business operations. Adjustments to long-term incentives represent adjustments to valuation of long-term cash incentive compensation awards that are related to prior years. These costs are excluded from Adjusted EBITDA because they do not relate to the current year and are considered to be outside of normal operations. Long-term incentives are earned over a three-year period and the costs are recorded over the three-year period they are earned. The amounts accrued or incurred are based on a cumulative of the three-year period. Equity-based compensation expense represents compensation that has been or will be paid in equity and is excluded from Adjusted EBITDA because it is a non-cash item.

Adjusted EBITDA is used by management as a supplemental financial measure to assess financial performance, without regard to charges or credits that are considered by management to be outside of its normal operations and without regard to financing methods, capital structure or historical cost basis, and to assess the Company’s ability to incur and service debt and fund capital expenditures.

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The following tables reconcile net income (loss) before taxes and discontinued operations to Adjusted EBITDA for the periods indicated:


	Three Months Ended
	September 30, 2023
	Completion Fluids & Products			Water & Flowback Services			Corporate SG&A		Other and Eliminations		Total
	(in thousands, except percentages)
Revenue	$	73,210		$	78,254		$	—	$	—	$	151,464
Net income (loss) before taxes and discontinued operations	16,932			8,475			(13,552)		(5,139)		6,716
Insurance recoveries	174			—			—		—		174

Exploration and pre-development costs	3,775			—			—		—		3,775
Adjustment to long-term incentives	—			—			500		—		500

Former CEO stock appreciation right expense	—			—			1,074		—		1,074
Transactions and other expenses	—			—			108		—		108
Income from collaborative arrangement	(1,933)			—			—		—		(1,933)


Interest (income) expense, net	(309)			190			—		5,755		5,636
Depreciation, amortization and accretion	2,301			6,176			—		101		8,578
Equity-based compensation expense	—			—			1,431		—		1,431
Adjusted EBITDA	$	20,940		$	14,841		$	(10,439)	$	717	$	26,059

Adjusted EBITDA as % of revenue	28.6		%	19.0		%					17.2		%

	Three Months Ended
	June 30, 2023
	Completion Fluids & Products			Water & Flowback Services			Corporate SG&A		Other and Eliminations		Total
	(in thousands, except percentages)
Revenue	$	98,222		$	77,241		$	—	$	—	$	175,463
Net income (loss) before taxes and discontinued operations	31,956			8,014			(12,595)		(6,295)		21,080
Insurance recoveries	(5)			—			—		—		(5)
Impairments and other charges	—			—			777		—		777
Exploration and pre-development costs	2,341			—			—		—		2,341
Adjustment to long-term incentives	—			—			322		—		322
Former CEO stock appreciation right expense	—			—			329		—		329
Transaction and other expenses	—			—			57		—		57
Income from collaborative arrangement	(4,749)			—			—		—		(4,749)
Interest expense, net	104			27			—		5,813		5,944
Depreciation, amortization and accretion	2,193			6,172			—		93		8,458
Equity-based compensation expense	—			—			1,492		—		1,492
Adjusted EBITDA	$	31,840		$	14,213		$	(9,618)	$	(389)	$	36,046

Adjusted EBITDA as % of revenue	32.4		%	18.4		%					20.5		%

Adjusted EBITDA is a financial measure that is not in accordance with U.S. GAAP and should not be considered an alternative to net income, operating income, cash provided by operating activities, or any other measure of financial performance presented in accordance with U.S. GAAP. This measure may not be comparable to similarly titled financial metrics of other companies, as other companies may not calculate Adjusted EBITDA in the same manner as we do. Management compensates for the limitations of Adjusted EBITDA as an analytical tool by reviewing the comparable U.S. GAAP measures, understanding the differences between the measures, and incorporating this knowledge into management’s decision-making processes.

Liquidity and Capital Resources

We believe that our capital structure allows us to meet our financial obligations. Our liquidity at the end of the third quarter was $107.0 million. Liquidity is defined as unrestricted cash plus availability under the ABL Credit Agreement, Argentina Credit Facility, and Swedish Credit Facility. Information about the terms and covenants of our debt agreements can be found in Note 6 - Long Term Debt and Other Borrowings.

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Our consolidated sources and uses of cash are as follows:


	Nine Months Ended September 30,
	2023		2022
	(in thousands)
Operating activities	$	51,331	$	25,948
Investing activities	(28,918)		(28,280)
Financing activities	(1,894)		(2,771)

Operating Activities

Consolidated cash flows provided by operating activities increased compared to the first nine months of 2022 primarily due to an increase in cash profit and working capital changes.

Investing Activities

Total cash capital expenditures during the first nine months of 2023 were $30.2 million, which reflects increased expenditures to accommodate industry-wide activity recoveries. Our Water & Flowback Services Division spent $22.0 million on capital expenditures, primarily to deploy additional SandStorm units to meet increased demands and to maintain, automate and upgrade its water management and flowback equipment fleet. Water and Flowback Services Division capital expenditures also included expenditures related to construction of the third early production facility in Argentina. Our Completion Fluids & Products Division spent $7.8 million on capital expenditures, primarily investing in additional capacity to support higher projected activity levels in the United States, Latin America and Europe.

Investing activities during the first nine months of 2023 and 2022 included $2.9 million and $3.8 million, respectively, of proceeds for insurance settlements from damage to our Lake Charles facility in 2020.

Historically, a significant majority of our planned capital expenditures have been related to identified opportunities to grow and expand our existing businesses. We are also focused on enhancing shareholder value by capitalizing on our key mineral assets, brine mineral extraction expertise, and deep chemistry competency to expand our offerings into the low carbon energy markets. However, we continue to review all capital expenditure plans carefully in an effort to conserve cash. We currently have no long-term capital expenditure commitments. If the forecasted demand for our products and services increases or decreases, the amount of planned expenditures on growth and expansion may be adjusted.

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Lithium and Bromine Inferred Resources

We have rights to the brine underlying our approximately 40,000 gross acres of brine leases in the Smackover Formation in Southwest Arkansas, including rights to the bromine and lithium contained in the brine. With respect to approximately 35,000 acres of that total acreage, we granted Standard Lithium an option to acquire the lithium rights. Standard Lithium delivered a notice to exercise this option to acquire those lithium rights on October 6, 2023. The agreements governing this option contemplate a 2.5% royalty that Standard Lithium would pay us based on gross lithium revenues. A copy of the Option Agreement with certain confidential information redacted is filed as Exhibit 10.1 to this Quarterly Report. Additional information on these inferred resources is described in Part I, “Item 2. Properties” in our 2022 Annual Report.

During early 2023, we completed an initial economic assessment for a bromine extraction plant. We expect an initial economic assessment to follow in early 2024 for a lithium extraction plant, subject to the progress of early engineering. In June 2023, we entered into the MOU with Saltwerx, an indirect wholly owned subsidiary of a Fortune 500 company, relating to a newly-proposed brine unit in the Smackover Formation in Southwest Arkansas and potential bromine and lithium production from brine produced from the unit. We filed an amended Application covering approximately 6,138 acres, which expands the size of the unit area and also combines brine acreage that was previously leased by each of TETRA and Saltwerx, with the AOGC. On September 26, 2023, the AOGC held a public hearing and unanimously approved our application to establish the Brine Unit. On October 17, 2023, the AOGC issued formal orders establishing the Brine Unit and integrating all unleased parties within the Brine Unit, subject to a 60-day statutory election period for each unleased party to elect whether or not to participate and share in costs of development of the Brine Unit. If no such election is made within the election period, such unleased parties will be deemed integrated within the Brine Unit as described in the formal orders. The Brine Unit will cover approximately 6,138 acres combining brine acreage leased by each of us and Saltwerx for development. Under Arkansas law, while bromine can be commercially extracted, the AOGC will need to establish the applicable lithium royalty before we can commercially produce lithium from the Brine Unit.

The MOU includes provisions relating to: (i) initial brine ownership percentages within the Brine Unit, including the bromine and lithium contained in the brine, (ii) the transfer of certain leased acres outside the proposed Brine Unit from us to Saltwerx after the expiration of the 60-day statutory election period, (iii) Saltwerx reimbursing us for certain expenses incurred by us to date regarding the development of leased acreage to be included in the Brine Unit, and (vi) an allocation of certain future costs for the drilling of a brine production test well and other development operations, including front-end engineering and design studies for bromine and lithium production facilities. During the second quarter of 2023, we also contracted a third-party firm to execute a front-end engineering and design study for a lithium production facility. Only upon completion of an indicated resources study, pre-feasibility and/or feasibility study and attainment of capital commitment from either a joint venture partner, governments grants or loans, or other cost-effective sources of capital that will not over-lever the Company, in addition to confirmation of a successful recapitalization of the long-duration zinc-bromide battery storage manufacturers, would we proceed to a final investment decision.

Financing Activities

Our financing activities for the first nine months of 2023 include $97.4 million of borrowings and $98.4 million of repayments under the ABL Credit Agreement, Argentina Credit Facility and Swedish Credit Facility, as well as $0.8 million of capital lease payments associated with equipment leased primarily for the early production facilities in Argentina. We may supplement our existing cash balances and cash flow from operating activities with short-term borrowings, long-term borrowings, issuances of equity and debt securities, and other sources of capital. We are aggressively managing our working capital and capital expenditure needs in order to maximize our liquidity in the current environment.

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Long-Term Debt

Term Credit Agreement. The Term Credit Agreement is scheduled to mature on September 10, 2025. As of September 30, 2023, $163.1 million in aggregate principal amount of our Term Credit Agreement is outstanding. Our Term Credit Agreement requires us to offer to prepay a percentage of Excess Cash Flow (as defined in the Term Credit Agreement) within five business days of filing our Annual Report. If our Leverage Ratio at year-end is less than 1.50 to 1.00, then no prepayment is required.

Asset-Based Credit Agreement. As of September 30, 2023, our ABL Credit Agreement provides for a senior secured revolving credit facility of up to $80.0 million, with a $20.0 million accordion. The credit facility is subject to a borrowing base to be determined by reference to the value of inventory and accounts receivable, and includes a sublimit of $20.0 million for letters of credit, a swingline loan sublimit of $11.5 million, and a $15.0 million sub-facility subject to a borrowing base consisting of certain trade receivables and inventory in the United Kingdom. The amounts we may borrow under the ABL Credit Agreement are derived from our accounts receivable, certain accrued receivables and certain inventory. Changes in demand for our products and services have an impact on our eligible accounts receivable, accrued receivables and the value of our inventory, which could result in significant changes to our borrowing base and therefore our availability under our ABL Credit Agreement. As of September 30, 2023, we had no balance outstanding and $11.5 million in letters of credit and guarantees against our ABL Credit Agreement and availability of $68.5 million, subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement.

Argentina Credit Facility. In January 2023, the Company entered into a revolving credit facility for certain working capital and capital expenditure needs for its subsidiary in Argentina (“Argentina Credit Facility”). As of September 30, 2023, we had $1.9 million outstanding and availability of $0.1 million under the Argentina Credit Agreement. Borrowings bear interest at a rate of 2.50% per annum. The Argentina Credit Facility was backed by a letter of credit under our ABL Credit Agreement, and expired and was repaid in October 2023.

Swedish Credit Facility. In January 2022, the Company entered into a revolving credit facility for seasonal working capital needs of subsidiaries in Sweden. As of September 30, 2023, we had a nominal amount outstanding and availability of approximately $4.6 million under this agreement. During each year, all outstanding loans under the Swedish Credit Facility must be repaid for at least 30 consecutive days. Borrowings bear interest at a rate of 2.95% per annum. The Swedish Credit Facility expires on December 31, 2023 and the Company intends to renew it annually.

Finland Credit Agreement. In January 2022, the Company also entered into a credit agreement guaranteed by certain accounts receivable and inventory in Finland (“Finland Credit Agreement”). As of September 30, 2023, there were $1.4 million of letters of credit outstanding against the Finland Credit Agreement. The Finland Credit Agreement expires on January 31, 2024 and the Company intends to renew it annually.

Other Sources and Uses of Cash

In addition to the aforementioned credit facilities, we fund our short-term liquidity requirements from cash generated by our operations and from short-term vendor financing. In addition, as of September 30, 2023, the market value of our investments in CSI Compressco and Standard Lithium were $7.2 million and $2.3 million, respectively, with no holding restrictions on our ability to monetize our interests. In addition, we are party to agreements in which Standard Lithium has the right to explore for, and an option to acquire the right to produce and extract lithium in our Arkansas leases as well as additional potential resources, in the Mojave region of California. Standard Lithium exercised its option with respect to our Arkansas leases on October 6, 2023. We also hold an investment in a convertible note issued by CarbonFree valued at $6.6 million as of September 30, 2023.

On May 5, 2022, we filed a universal shelf Registration Statement on Form S-3 with the SEC. On May 17, 2022, the Registration Statement on Form S-3 was declared effective by the SEC. Pursuant to this registration statement, we have the ability to sell debt or equity securities in one or more public offerings up to an aggregate public offering price of $400 million. This shelf registration statement currently provides us additional flexibility with regards to potential financing that we may undertake when market conditions permit or our financial condition may require.

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Should additional capital be required, the ability to raise such capital through the issuance of additional debt or equity securities may currently be limited. Instability or volatility in the capital markets at the times we need to access capital may affect the cost of capital and the ability to raise capital for an indeterminable length of time. If it is necessary to issue additional equity to fund our capital needs, additional dilution of our common stockholders will occur. We periodically evaluate engaging in strategic transactions and may consider divesting non-core assets where our evaluation suggests such transactions are in the best interest of our business. In challenging economic environments, we may experience increased delays and failures by customers to pay our invoices. If our customers delay paying or fail to pay us a significant amount of our outstanding receivables, it could have an adverse effect on our liquidity. An increase in unpaid aged receivables would also negatively affect our borrowing availability under the ABL Credit Agreement.

As of September 30, 2023, we had no “off balance sheet arrangements” that may have a current or future material effect on our consolidated financial condition or results of operations.

Critical Accounting Policies and Estimates

There have been no material changes or developments in the evaluation of the accounting estimates and

the underlying assumptions or methodologies pertaining to our Critical Accounting Policies and Estimates disclosed

in our 2022 Annual Report. In preparing our consolidated financial statements, we make assumptions, estimates, and judgments that affect the amounts reported. These judgments and estimates may change as new events occur, as new information is acquired, and as changes in our operating environments are encountered. Actual results are likely to differ from our current estimates, and those differences may be material.

Commitments and Contingencies

Litigation

For information regarding litigation, see Note 7 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements and Part II, “Item 1. Legal Proceedings” in this report.

Long-Term Debt

For information on our credit agreements, see Note 6 - “Long-Term Debt and Other Borrowings” in the Notes to Consolidated Financial Statements.

Leases

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain facility storage tanks and equipment rentals. Information about the terms of our lease agreements can be found in our 2022 Annual Report.

Product and Asset Purchase Obligations

For information on product and asset purchase obligations, see Note 7 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements.

Cautionary Statement for Purposes of Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements in this Quarterly Report are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates”, “assumes”, “believes”, “budgets”, “could”, “estimates”, “expects”, “forecasts”, “goal”, “intends”, “may”, “might”, “plans”, “predicts”, “projects”, “schedules”, “seeks”, “should”, “targets”, “will”, and “would”.

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These forward-looking statements include statements concerning the inferred mineral resources of lithium and bromine, the potential extraction of lithium and bromine from the leased acreage, the development of the assets including construction of bromine extraction plants, the economic viability thereof, the demand for such resources, and the timing and cost of such activities; the ability to obtain an indicated or measured resources report and an initial economic assessment, indicated or measured resources report, and/or pre-feasibility or feasibility studies regarding our lithium and bromine acreage; statements regarding the Company's beliefs, expectations, plans, goals, future events and performance; and other statements that are not purely historical. With respect to the Company's disclosures of inferred mineral resources, including bromine and lithium carbonate equivalent concentrations, it is uncertain if further exploration will ever result in the estimation of a higher category of mineral resource or a mineral reserve. Inferred mineral resources are considered to have the lowest level of geological confidence of all mineral resources. Investors are cautioned that inferred mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally commercialized. A significant amount of exploration must be completed in order to determine whether an inferred mineral resource may be upgraded to a higher category. Therefore, investors are cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally commercialized, or that it will ever be upgraded to a higher category. With respect to the Company’s disclosures of the MOU with Saltwerx, it is uncertain about the ability of the parties to successfully negotiate one or more definitive agreements, the future relationship between the parties, and the ability to successfully and economically produce lithium and bromine from the Brine Unit.

Management believes that these forward-looking statements are reasonable as and when made. However, investors are cautioned not to place undue reliance on any such forward-looking statements. Such statements speak only as of the date on which they are made, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations, forecasts or projections. These risks and uncertainties include, but are not limited to, those described in Part II, “Item 1A. Risk Factors” and elsewhere in this report and in our 2022 Annual Report, and those described from time to time in our future reports filed with the SEC.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Interest Rate Risk

The interest on our borrowings is subject to market risk exposure related to changes in applicable interest rates. Borrowings under the Term Credit Agreement bear interest at a rate per annum equal to, at the option of TETRA, either (i) SOFR (subject to a 1% floor) plus a margin of 6.25% per annum or (ii) a base rate plus a margin of 5.25% per annum. Borrowings under our ABL Credit Agreement bear interest at an agreed-upon percentage rate spread above SOFR. Borrowings under our Argentina Credit Facility and Swedish Credit Facility bear interest at fixed rates of 2.50% and 2.95%, respectively. The following table sets forth as of September 30, 2023, the principal amount due under our long-term debt obligations and their respective weighted average interest rates. As of September 30, 2023, we had no balance outstanding under our ABL Credit Agreement. We are not a party to an interest rate swap contract or other derivative instrument designed to hedge our exposure to interest rate fluctuation risk.


		Interest	September 30, 2023
	Scheduled Maturity	Rate
			(in thousands)
Term Credit Agreement	September 10, 2025	11.68%	$	163,071
Asset-Based Credit Agreement	May 31, 2025	8.75%	—
Argentina Credit Facility	October 19, 2023	2.50%	1,900
Swedish Credit Facility	December 31, 2023	2.95%	11
TETRA total debt, including current portion			$	164,982

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Exchange Rate Risk

We have currency exchange rate risk exposure related to revenues, expenses, operating receivables, and payables denominated in foreign currencies. We may enter into short-term foreign-currency forward derivative contracts as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not expected to be formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative instruments during a period will be included in the determination of earnings for that period. As of September 30, 2023, we did not have any foreign currency exchange contracts outstanding.

Item 4. Controls and Procedures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2023, the end of the period covered by this quarterly report.

There were no changes in our internal controls over financial reporting that occurred during the quarter ended September 30, 2023, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

For information regarding litigation, see “Item 1. Legal Proceedings” in our 2022 Annual Report, our Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, and Note 7 - “Commitments and Contingencies” in the Notes to Consolidated Financial Statements included in this Quarterly Report.

Item 1A. Risk Factors.

As of the date of this filing, TETRA and its operations continue to be subject to the risk factors previously disclosed in the “Risk Factors” sections contained in our 2022 Annual Report. In addition, we are subject to the following supplemental risk factor.

We may not be able to utilize all or a portion of our net operating loss carryforwards or other tax benefits to offset future taxable income for U.S. federal, state or foreign tax purposes, which could adversely affect our financial position, results of operations and cash flows. We have adopted a Tax Benefits Preservation Plan (the “Tax Plan”) that is designed to protect our Tax Attributes.

As of December 31, 2022, we had United States federal, state, and foreign deferred tax assets associated with net operating loss carryforwards (“NOLs”) equal to approximately $86.2 million, $11.1 million, and $7.8 million, respectively. 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 2023 through 2042.

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. Utilization of these NOLs depends on many factors, including our future taxable income, which cannot be assured.

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). Utilization of our Tax Attributes may be subject to a significant annual limitation as a result of prior or future “ownership changes.” Determining the limitations under Section 382 is technical and highly complex, and no assurance can be given that upon further analysis our ability to take advantage of our NOLs or other Tax Attributes may be limited to a greater extent than we currently anticipate.

The Board of Directors has adopted the Tax Plan to protect the availability of the Company’s Tax Attributes. The Tax Plan is designed to reduce the likelihood that we experience an ownership change by deterring certain 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. In addition, the Tax Plan could adversely affect the marketability of our common stock by discouraging existing or potential investors from acquiring our common stock or additional shares of our common stock. If the Company is unable to use the Tax Attributes in years in which it has taxable income, the Company will pay significantly more in cash tax than if it were able to utilize the Tax Attributes, and those tax costs would negatively impact the Company’s financial position, results of operations and cash flows.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

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Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

Rule 10b5-1 Trading Arrangements

During the three months ended September 30, 2023, no director or officer of TETRA adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

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Item 6. Exhibits.

Exhibits:


3.1			Certificate of Designation of Series A Junior Participating Preferred Stock (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed on March 1, 2023 (SEC File No. 001-13455).
3.2			Amended and Restated Certificate of Incorporation of TETRA Technologies, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed on May 25, 2023 (SEC File No. 001-13455)).
3.3			Second Amended and Restated Bylaws of TETRA Technologies, Inc. (incorporated by reference to Exhibit 3.2 to the Company’s Form 8-K filed on May 25, 2023 (SEC File No. 001-13455)).
4.1			Tax Benefits Preservation Plan dated as of February 28, 2023, between TETRA Technologies, Inc. and Computershare Trust Company, N.A. as Rights Agent (incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K filed on March 1, 2023 (SEC File No. 001-13455).
10.1*+#			Option Agreement dated December 29, 2017 by and among TETRA Technologies, Inc., SWA Lithium LLC (as successor-in-interest to Arkansas Lithium Ltd), and Standard Lithium Ltd.
31.1*			Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*			Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**			Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**			Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.SCH++			XBRL Taxonomy Extension Schema Document.
101.CAL++			XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF++			XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB++			XBRL Taxonomy Extension Label Linkbase Document.
101.PRE++			XBRL Taxonomy Extension Presentation Linkbase Document.
104*			Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL documents

* Filed with this report.

** Furnished with this report.

+ Portions have been omitted pursuant to Regulation S-K Item 601(b)(10)(iv), because the omitted information is both not material and is the type that the Company treats as private or confidential.

++ Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2023 and 2022; (ii) Consolidated Statements of Comprehensive Income for the three and nine-month periods ended September 30, 2023 and 2022; (iii) Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022; (iv) Consolidated Statements of Equity for the nine-month periods ended September 30, 2023 and 2022; (v) Consolidated Statements of Cash Flows for the nine-month periods ended September 30, 2023 and 2022; and (vi) Notes to Consolidated Financial Statements for the nine months ended September 30, 2023.

# Certain schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant agrees to furnish supplementally a copy of any such omitted schedule to the SEC upon request.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		TETRA Technologies, Inc.

Date:	October 30, 2023	By:	/s/Brady M. Murphy
			Brady M. Murphy
			President and Chief Executive Officer
			Principal Executive Officer

Date:	October 30, 2023	By:	/s/Elijio V. Serrano
			Elijio V. Serrano
			Senior Vice President and Chief Financial Officer
			Principal Financial Officer

Date:	October 30, 2023	By:	/s/Richard D. O’Brien
			Richard D. O’Brien
			Vice President – Finance and Global Controller
			Principal Accounting Officer

Execution Copy

SPECIFIC TERMS IN THIS AGREEMENT HAVE BEEN REDACTED BECAUSE SUCH TERMS ARE BOTH NOT MATERIAL AND ARE OF A TYPE THAT TETRA TECHNOLOGIES, INC. TREATS AS CONFIDENTIAL. THESE REDACTED TERMS HAVE BEEN MARKED IN THIS EXHIBIT AT THE APPROPRIATE PLACE WITH THREE ASTERISKS [***].

OPTION AGREEMENT

THIS OPTION AGREEMENT is made as of the 29th day of December, 2017 .

BETWEEN:

TETRA TECHNOLOGIES, INC., a corporation existing under the laws of the State of Delaware and having an office located at 24955 Interstate 45 North, The Woodlands, Texas, 77380

(the “Underlying Owner”)

AND:

ARKANSAS LITHIUM CORP., a corporation existing under the laws of the State of Nevada and having an office located at Suite 888, 1100 Melville Street, Vancouver, British Columbia, V6E 4A6

(the “Optionee”)

AND:

STANDARD LITHIUM LTD., a corporation existing under the federal laws of Canada and having an office located at Suite 888, 1100 Melville Street, Vancouver, British Columbia, V6E 4A6

(the “Optionee Parent”)

RECITALS:

A. The Underlying Owner is the lessee under various brine leases and term brine deeds located in Columbia and Lafayette Counties in the State of Arkansas, as more particularly described in Exhibit A hereto (collectively referred to herein as the “Leases”);

B. The Underlying Owner desires to grant to the Optionee, and Optionee desires to receive, the Option (as defined herein), on the terms and subject to the conditions set out in this Agreement; and

C. The Optionee is an indirect wholly-owned subsidiary of the Optionee Parent.

NOW THEREFORE, in consideration of one ($1.00) dollar paid by each Party to the other, and the mutual promises, covenants, conditions, representations and warranties herein set out, the Parties agree as follows:

ARTICLE 1 - DEFINITIONS

1.1For the purposes of this Agreement, the following words and phrases shall have the following meanings, namely:

(a)“Affiliate” shall mean a direct or indirect subsidiary, parent company, or entity which shares the same control person;

(b)“Agreement” means this Option Agreement, as amended from time to time;

(c)“Agreement Date” means the date of this Agreement, as first set out above;

(d)“AOGC” means the Arkansas Oil and Gas Commission.

(e)“Authorized Recipients” has the meaning ascribed to such term in Section 8.2.

(f)“Business Day” means a day other than a Saturday, Sunday or any day on which banks in the City of Houston, Texas are not open for business during normal banking hours;

(g)“Claim” or “Claims” means all claims, damages, liabilities, losses, demands, liens, encumbrances, fines, penalties, causes of action of any kind, obligations, costs, judgments, penalties, interest and awards (including payment of reasonable attorneys’ fees and costs of litigation and investigation costs) or amounts, of any kind or character, whether under judicial proceedings, administrative proceedings or otherwise, and whether in law or in equity, and whether in tort or otherwise.

(h)“Commercial Production” means the production of Extracted Materials from the Exercised Leases in commercial quantities. Commercial Production will be deemed to have commenced on the first day of the month following the first occasion that Extracted Materials are shipped from the property comprising the Exercised Leases for commercial purposes; provided, however, that the processing or shipping of bulk samples for testing purposes shall not be considered for the purpose of establishing the commencement of Commercial Production.

(i)“Confidential Information” means all confidential and/or proprietary information disclosed by one Party (“Disclosing Party”) to the other Party (“Receiving Party”), and may include, but is not limited to, information concerning a potential business relationship between the Parties, trade secrets, physical samples, financial, business, sales or technical information, terms of agreements, negotiations or proposals, business operations, plans, products, processes, technology, strategies, facilities, research, finances, customers, legal affairs, pricing, information systems, development plans, marketing information, commercial information, properties, environmental considerations, suppliers, technical information, raw material usage or sourcing, business methods, personnel and similar confidential or proprietary information or data of, concerning or belonging to the Disclosing Party and/or its parent, subsidiaries or affiliate that is disclosed (a) in written or other tangible form and marked “Confidential” or with words of similar import, (b) orally or visually and identified as confidential or proprietary information at the time of disclosure, or (c) under circumstances by which Receiving Party should reasonably understand such information is to be treated as confidential, whether or not marked “Confidential” or otherwise. Confidential Information shall not include information that: (a) is already known to Receiving Party or its Affiliates at the time of disclosure without obligation of confidentiality to Disclosing Party, (b) is or becomes publicly known through no wrongful act or omission of Receiving Party or its Affiliates, (c) is rightfully received

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by Receiving Party or its Affiliates from a third party without a known obligation of confidentiality, or (d) was developed by Receiving Party or its Affiliates independently and without the use or benefit of any of the Confidential Information.

(j)“Development Operations” means (i) all Exploratory Operations, and (ii) all activities carried out by Optionee in connection with the development and production of, including without limitation, drilling for brine; laying pipelines; installing power lines and power stations; building roads, bridges, tanks and other structures and facilities for the production of: (a) Extracted Materials; (b) the processing and distribution of Extracted Materials; (c) the construction of any improvements, fixtures or equipment reasonably necessary therefor; (d) disposal of post-extraction brine following extraction of the Extracted Materials; and (e) any other activities or operations related to or necessary for the drilling, development and production and disposal of brine and extraction and Commercial Production of Extracted Materials on, in or under the Leases, each of the foregoing in accordance with the rights granted herein and under the Limited Mineral Assignment;

(k)“Disclosing Party” has the meaning attributed to such term in the definition of Confidential Information.

(l)“Environmental Claims” means any and all Claims relating in any way to any Environmental Law or any permit issued under any Environmental Law, including:

(i)any and all Claims by any government or regulatory authorities for enforcement, clean-up, removal, response, remedial, or other actions or damages under any applicable Environmental Law; and

(ii)any and all Claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation, or injunctive or other relief resulting from hazardous materials, including any release of those Claims, or arising from alleged injury or threat of injury to human health or safety (arising from environmental matters) or the environment;

(m)“Environmental Laws” means all laws, rules or regulations of any agency, board, or governmental authority having authority over the property comprising the Leases, relating to: (i) pollution or environmental protection of the air, surface water, ground water, or land; (ii) solid, gaseous, or liquid waste generation, handling, treatment, storage, disposal, or transportation; (iii) exposure to hazardous or toxic substances; or (iv) the closure, decommissioning, dismantling, or abandonment of any facilities, mines, or workings and the reclamation or restoration of the property comprising the Leases;

(n)“Environmental Liability” means any Claim suffered or incurred in respect of environmental cleanup and remediation obligations and liabilities arising directly or indirectly from operations or activities conducted in or on the Leases;

(o)“Exercised Leases” means those Leases with respect to which Optionee has exercised the Option;

(p)“Exploratory Operations” means all activities carried out by Optionee in connection with the rights and licenses under the Leases granted by

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Underlying Owner to Optionee under this Agreement to investigate, prospect and explore for, and evaluate the production of, Extracted Materials, including without limitation conducting exploration, geologic and geophysical tests. Exploratory Operations do not include right to produce Extracted Materials in commercial quantities under the Leases;

(q)“Exploratory Period” means the period commencing on Agreement Date and continuing until the earliest of (i) the date that is the 10year anniversary of the Agreement Date; (ii) the execution and delivery of the Limited Mineral Assignment; or (iii) any termination of this Agreement;

(r)“Extracted Materials” means lithium and [***], derived or extracted from brine produced from the Leases;

(s)“Indemnitee” has the meaning attributed to such term in Section 10.5.

(t)“Indemnitor” has the meaning attributed to such term in Section 10.5.

(u)“Knowledge of Underlying Owner” shall mean the actual knowledge of any of [***] (President & CEO), [***] (VP - Chemicals) and [***] (General Counsel), except to the extent that such knowledge is subject to attorney-client privilege.

(v)“Lease Period” means the period commencing on the date that the Limited Mineral Assignment with respect to the Extracted Materials is executed by the Parties, and continuing for a period equal to the life of the underlying Exercised Lease(s);

(w)“Leases” has the meaning attributed to such term in Recital A hereto;

(x)“Limited Mineral Assignment” means an instrument in the form attached hereto as Exhibit B.

(y)“Minimum Royalty” means $[***];

(z)“NDA” means the mutual nondisclosure agreement entered into between the Underlying Owner and the Optionee Parent, dated June 8, 2017, and as subsequently amended;

(aa)“Option” means the exclusive option, during the Exploratory Period, to obtain the Limited Mineral Assignment and, if exercised, to conduct Development Operations in accordance with this Agreement and the Exercised Lease(s);

(bb)“Optionee” has the meaning attributed to such term in the preamble;

(cc)“Optionee Group” shall mean, whether individually or collectively, (i) Optionee, its parent, subsidiary and affiliated or related companies, (ii) its and their joint owners, co-lessees, partners, joint venturers, if any, and their respective parents, subsidiary and affiliated or related companies, (iii) its and their contractors and subcontractors of every tier (other than any member of Underlying Owner Group) and (iv) the officers, directors, employees, agents, consultants, insurers and invitees of all of the foregoing.

(dd)“Optionee Parent” has the meaning attributed to such term in the preamble;

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(ee)“Parties” means Underlying Owner, Optionee and Optionee Parent, collectively, and “Party” means each of the foregoing individually.

(ff)“Receiving Party” has the meaning attributed to such term in the definition of Confidential Information.

(gg)“REGARDLESS OF FAULT” shall mean without regard to the cause or causes thereof including, without limitation, pre-existing conditions, whether such conditions be patent or latent, imperfection of material, defect or failure of equipment, breach of representation or warranty (express or implied), ultrahazardous activity, strict liability, tort, breach of contract, breach of statutory duty, breach of any safety requirement or regulation, or the negligence of any person or party, including the indemnified Party or Parties, whether such negligence be sole, joint and/or concurrent, active or passive, or any other theory of legal liability.

(hh)“Royalty” means a two and one-half percent (2.5%) royalty on gross revenue derived by Optionee or any of its Affiliates from the sale of Extracted Materials to a Third Party in an arms-length transaction, without any deduction of any kind or nature;

(ii)“Third Party” shall mean any person or entity not a member of Underlying Owner Group or Optionee Group.

(jj)“Underlying Owner” is defined in the preamble; and

(kk)“Underlying Owner Group” shall mean, whether individually or collectively, (i) Underlying Owner, its parent, subsidiary and affiliated or related companies, (ii) its and their joint owners, co-lessees, partners, joint venturers, if any, and their respective parents, subsidiary and affiliated or related companies, (iii) its and their contractors and subcontractors of every tier (other than any member of Optionee Group) and (iv) the officers, directors, employees, agents, consultants, insurers and invitees of all of the foregoing.

1.2Entire Agreement; Amendment

Except as described in the immediately following sentence, this Agreement constitutes the entire agreement between the Parties pertaining to the subject matter of this Agreement, and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of and between the Parties relating to the subject matter herein (including but not limited to the NDA and the memorandum of understanding entered into between the Underlying Owner and the Optionee Parent dated effective July 26, 2017 (the “MOU”), which shall terminate as of the date hereof), and there are no representations, warranties, covenants or other agreements among the Parties to this Agreement in connection with the subject matter of this Agreement except as specifically set forth in this Agreement.

1.3Headings

The Articles, Sections, subsections and other headings contained herein are included solely for convenience, are not intended to be full or accurate descriptions of the content of this Agreement and shall not be considered part of this Agreement.

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1.4Currency

Unless otherwise indicated, all dollar amounts contained in this Agreement are and shall be construed to be in dollars in the lawful currency of the United States of America.

1.5Exhibits

The following Exhibit attached to this Agreement is an integral part of this Agreement:


Exhibit A	-	Description of Leases
Exhibit B	-	Form of Limited Mineral Assignment

Exhibit C	-	Form of Ratification, Extension and Renewal of Brine Lease
Exhibit D	-	Insurance Requirements

ARTICLE 2 – REPRESENTATIONS AND WARRANTIES

2.1Each of (i) the Underlying Owner, on one hand, and (ii) Optionee and Optionee Parent, on the other, represent and warrant to the other, as of the Agreement Date that:

(a)it has duly obtained all necessary authorizations for the execution, delivery, and performance of this Agreement, and such execution, delivery and performance and the consummation of the transactions contemplated by this Agreement will not conflict with, or accelerate the performance required by or result in any breach of any covenants or agreements contained in or constitute a default under, or result in the creation of any encumbrance, lien or charge under the provisions of its governing documents or any indenture, agreement or other instrument whatsoever to which it is a party or by which it is bound or to which it may be subject, and will not contravene any applicable laws; and

(b)this Agreement, when delivered in accordance with the terms hereof, will constitute a valid and binding obligation enforceable against it in accordance with its terms, except (i) as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

2.2The Underlying Owner represents and warrants to each of the Optionee and the Optionee Parent that, as of the Agreement Date:

(a)except as set forth on Schedule 2.2(a), to the Knowledge of Underlying Owner, the Leases are legally and beneficially owned or held by it, are valid and enforceable, and are free and clear of any liens, charges or encumbrances;

(b)except as set forth on Schedule 2.2(b), to the Knowledge of Underlying Owner, all fees, taxes, assessments, rentals, levies or other payments required to be made relating to the Leases have been made, except

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where the failure of such payment would not reasonably be expected to have a material adverse effect on the ability of the Underlying Owner to consummate the transactions contemplated by this Agreement;

(c)other than this Agreement, it is not a party to any outstanding agreements or options to acquire, purchase or sell the Leases or any portion thereof or any interest therein;

(d)except as set forth in Schedule 2.2(d), to the Knowledge of Underlying Owner, there is no adverse Claim or challenge against or to the ownership of or title to any part of the Leases or the property comprising the Leases that would reasonably be expected to have a material adverse effect on the ability of Underlying Owner to perform its obligations hereunder;

(e)to the Knowledge of Underlying Owner, there are no Claims pending or threatened against or relating to the Leases before or by any governmental or regulatory agency or board that would reasonably be expected to have a material adverse effect on its ability to perform its obligations hereunder;

(f)to the Knowledge of Underlying Owner, there has been no material spill, discharge, leak, emission, ejection, escape, dumping, or any release of any kind, of any toxic or hazardous substance or waste (as defined by any applicable law) on the property comprising the Leases in violation of Environmental Law, except as would not reasonably be expected to have a material adverse effect on its ability to perform its obligations hereunder;

(g)no toxic or hazardous substance or waste has been treated or disposed of by Underlying Owner on the property comprising the Leases, or is located or stored on the Leases as a result of activities of the Underlying Owner, except as would not reasonably be expected to have a material adverse effect on its ability to perform its obligations hereunder;

(h)it has not received from any governmental or regulatory agency or board, any notice of or communication relating to any actual or alleged Environmental Claims and, to the Knowledge of Underlying Owner, there are no outstanding work orders or actions required to be taken relating to environmental matters respecting the Leases or any operations carried out on the Leases that would reasonably be expected to have a material adverse effect on its ability to perform its obligations hereunder; and

(i)to the Knowledge of Underlying Owner, Underlying Owner has not conveyed any interest in the Leases to any third party, except where such conveyance would not be reasonably expected to have a material adverse effect on Optionee’s ability to achieve Commercial Production of Extracted Minerals.

2.3The Optionee represents and warrants to the Underlying Owner that, as of the Agreement Date:

(a)it is a company duly incorporated, validly subsisting and in good standing with respect to filing of annual reports under the laws of the State of Nevada;

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(b)it has full power and authority to carry on its business and to enter into this Agreement and any agreement or instrument referred to in or contemplated by this Agreement and to carry out and perform all of its obligations and duties hereunder; and

(c)it has financial capability to make all payments due to Underlying Owner or otherwise hereunder.

2.4Each of the Optionee and the Optionee Parent acknowledges and agrees that the Underlying Owner makes no representations or warranties except as set forth above, and that it expressly disclaims any representation or warranty (a) as to the possibility or merits of Commercial Production on the Leases; (b) otherwise with respect to the Extracted Minerals or Leases.

2.5The representations and warranties set forth in Sections 2.1 through 2.3 shall survive for a period of (i) twelve (12) months following the Agreement Date.

ARTICLE 3 - DUE DILIGENCE; GRANT OF OPTION; CONSIDERATION

3.1Optionee shall have until [***] to conduct due diligence concerning Underlying Owner’s title to the Leases. If the Parties jointly agree that Underlying Owner’s title is defective with respect to any Lease, Underlying Owner shall have 120 days after [***], to acquire sufficient acreage to cure the defects. If Underlying Owner is unable to cure such defects, Optionee shall have the right to either (i) terminate this Agreement with respect to the Leases that are defective, or (ii) accept Underlying Owner’s title with respect to such Leases “AS IS, WHERE IS”. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, THE REMEDIES SET FORTH IN THIS SECTION 3.1 SHALL BE THE SOLE RECOURSE AND EXCLUSIVE REMEDY OF OPTIONEE AND/OR OPTIONEE PARENT IN THE EVENT OF UNDERLYING OWNER’S BREACH OF ANY REPRESENTATIONS OR WARRANTIES WITH RESPECT TO TITLE CONCERNING ANY OF THE LEASES, WHETHER SUCH REPRESENTATION OR WARRANTY IS CONTAINED IN THIS AGREEMENT, ANY OTHER AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, OR OTHERWISE ARISES FROM THE TRANSACTIONS CONTEMPLATED HEREBY.

3.2Subject to the terms and conditions of this Agreement, the Underlying Owner hereby grants the Option to the Optionee. The Option may only be exercised a single time after Optionee’s completion of its due diligence pursuant to Section 3.1, and may be exercised with respect to any portion, or all, of the Leases, at Optionee’s sole election. For the avoidance of doubt, the Parties agree that the Optionee may not exercise the Option with respect to a portion of any single Lease, and that if the Optionee exercises the Option under a particular Lease, it must exercise the Option with respect to the entirety of any such Lease. Upon exercise of the Option, all rights granted hereunder with respect to Leases that are not Exercised Leases at such time shall automatically terminate, and shall immediately cease and revert to Underlying Owner.

3.3Upon Optionee’s exercise of the Option, the Parties shall promptly commence the following proceedings with respect to the Exercised Leases:

(a)Underlying owner shall deliver to Optionee an executed Limited Mineral Assignment.

(b)Underlying Owner shall, at Optionee’s sole expense, reasonably cooperate with Optionee to the extent necessary for Optionee to obtain

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drilling permits and any other required regulatory approval for brine production wells and brine disposal wells to be utilized by Optionee in its Development Operations.

(c)Underlying Owner shall, at Optionee’s sole expense, reasonably cooperate with Optionee to the extent necessary for Optionee to secure administrative orders of the AOGC forming one or more brine production units to facilitate Development Operations and pooling all owners therein, including previously unleased brine owners and/or uncommitted brine leasehold owners.

(d)Underlying Owner shall, at Optionee’s sole expense, reasonably cooperate with Optionee to the extent necessary for Optionee to secure an order of the AOGC establishing an appropriate royalty payable to brine owners occasioned by Optionee’s extraction of the Extracted Materials.

3.4Underlying Owner expressly reserves, excepts, and retains all rights under the Leases, including, without limitation, exploration and production activities with regard to all minerals and chemical substances which may be produced from brine from the Leases, other than Extracted Minerals.

3.5In consideration for the grant of the Option hereunder, the Optionee shall make the following payments to the Underlying Owner in immediately available funds:

(a)$[***] on or before the date that is [***] following the Agreement Date;

(b)an additional $[***] on or before the date that is [***] months following the Agreement Date;

(c)an additional $[***] on or before the date that is [***] months following the Agreement Date;

(d)an additional $[***] on or before the date that is [***] months following the Agreement Date; and

(e)additional annual payments of $[***] on or before [***] beginning with the date that is [***] months following the Agreement Date, until the earlier of the expiration of the Exploratory Period or, if Optionee exercises the Option, the Optionee beginning payment of the Royalty.

3.6The Underlying Owner acknowledges receipt of a payment of $[***] from the Optionee Parent, which amount constitutes a non-refundable payment made in consideration of the Underlying Owner’s execution of the MOU.

ARTICLE 4 - ROYALTY

4.1During the Lease Period, at any time following the commencement of Commercial Production, the Optionee shall pay the Royalty to the Underlying Owner in accordance with Section 4.2. The Parties may agree to enter into a further agreement setting out the terms relating to the calculation and payment of the Royalty provided such agreement contains at a minimum the terms and conditions set out in this Article 4. If no such agreement is entered into by the Parties then this Agreement will continue to be binding in respect of the rights relating to the Royalty.

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4.2Installments of the Royalty payable shall be paid by the Optionee to the Underlying Owner within thirty (30) days after the end of each calendar quarter.

4.3In the event the aggregate Royalty paid to the Underlying Owner in any calendar year does not exceed the Minimum Royalty, the Optionee shall make an additional payment to the Underlying Owner within thirty (30) days after the end of such calendar year such that the total Royalty received by the Underlying Owner in that year equals the Minimum Royalty; provided that the amount of the Minimum Royalty shall be prorated for the calendar year during which the Royalty first becomes payable. For greater certainty, except with respect to the first year that the Royalty is paid, in no circumstances shall the total Royalty received by the Underlying Owner in any calendar year be less than the Minimum Royalty.

4.4Not later than one-hundred-twenty (120) days after the end of each calendar year with respect to which the Royalty is due, the books and records of the Optionee relating to operations on the Exercised Leases and the statement of operations, which shall include the calculation of the Royalty for such year, shall be available for review by the Underlying Owner or its representatives. The Underlying Owner shall have sixty (60) days after review of such information to question the accuracy thereof in writing and, failing such objection, the statements shall be deemed to be correct thereafter.

4.5If the Parties determine that any overpayment by the Optionee of the Royalty has occurred, the amount of the overpayment shall be deducted from future installments of the Royalty payable (including amounts payable pursuant to Section 4.3 hereof).

4.6If Underlying Owner determines that any underpayment by the Optionee of the Royalty has occurred, the amount thereof shall be paid by the Optionee to the Underlying Owner promptly after notice thereof by Underlying Owner (but in any event within 30 calendar days following the date of such notice).

ARTICLE 5 - COVENANTS

5.1Optionee agrees that, until [***] it shall not directly or indirectly contact or negotiate with the lessors under any of the Leases, or otherwise attempt to enter into brine leases or obtain similar rights from such lessors or the owners of the interests covered by the Leases, or to interfere with Underlying Owner’s relationships with such lessors or owners without the prior written consent of Underlying Owner.

5.2Underlying Owner agrees that:

(a)provided Optionee is not in breach of Section 5.5, and subject to Section 5.8, to the extent within its control, it will use commercially reasonable efforts to (i) during the Exploratory Period, keep all Leases in good standing; and (ii) after exercise of the Option, keep the Exercised Leases in good standing during the Lease Period; and

(b)it will not actively engage in the production of Extracted Materials from brine produced from the Leases(during the Exploratory Period) or the Exercised Leases (after exercise of the Option), except as a by-product of operations conducted by the Underlying Owner on lands comprising the Leases (during the Exploratory Period) or the Exercised Leases (after

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exercise of the Option). If produced, Underlying Owner agrees not to sell any such by-product in competition with Optionee.

5.3Underlying Owner hereby grants to Optionee, its employees and third-party contractors acting on behalf of Optionee, a limited license to conduct Exploratory Operations during the Exploratory Period.

5.4If the Option is exercised, after execution by the Parties of the Limited Mineral Assignment, during the Lease Period, Underlying Owner grants to Optionee the right, power and authority, at its sole cost and expense, to do everything reasonably necessary or desirable to conduct the Development Operations on the Exercised Leases as they relate to the extraction of Extracted Materials, including the right, power and authority to:

(a)access the property comprising the Exercised Leases;

(b)employ and engage such employees, agents and independent contractors as the Optionee may consider necessary or advisable to carry out Development Operations on the Exercised Leases and in this connection to delegate any of its powers and rights to perform its duties and obligations hereunder;

(c)develop and construct any facilities for extraction, transportation, processing and refining of Extracted Materials from brine produced from the Exercised Leases, provided that (i) the siting of any such facilities on the lands constituting the Exercised Leases has been approved in advance in writing by the Underlying Owner, which approval shall not be unreasonably withheld, and (ii) that such Development Operations do not interfere with Underlying Owner’s rights and activities under the Exercised Leases (or any other Leases); and

(d)remove produced brine and Extracted Materials from the Leases;

provided, however that Underlying Owner shall at all times have the right to conduct operations on the lands comprising the Leases, and its rights to conduct operations shall in no event be subordinated to Optionee’s Operations. Notwithstanding anything to the contrary in this Agreement, Optionee’s rights, powers and authority with respect to the Exercised Leases are at all times subject to, and limited by, the terms of the Exercised Leases and all applicable laws, rules and regulations in effect from time to time, including those of the AOGC.

5.5With respect to the Exercised Leases, the Optionee covenants to:

(a)use its best efforts to minimize the impact of its Development Operations on operations of the Underlying Owner on the Exercised Leases as in effect as of the date hereof or in the future;

(b)ensure that all Development Operations conducted on the lands subject to the Exercised Leases by the Optionee, and any of its employees, agents, consultants or contractors are conducted in a good and workmanlike manner in accordance with sound mining practices and industry standards and in accordance with all applicable laws and regulations governing the Exercised Leases, and consistent with appropriate health, safety and environmental considerations (for clarification, Underlying Owner has no responsibility or duty to supervise Optionee’s or Optionee Parent’s operations or safety and health programs);

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(c)pay all expenses incurred or authorized by the Optionee in respect of all operations conducted by the Optionee on or with respect to the Exercised Leases in a timely fashion, and ensure the Exercised Leases are kept free of any liens, charges and encumbrances arising from such operations;

(d)not less than ten (10) business days before payment is due, provide Underlying Owner with a detailed calculation of royalties due to Third Parties due to Optionee’s Commercial Production;

(e)timely reimburse Underlying Owner for lease delay rentals, and, when payment of royalties is required, either by the terms of the Exercised Leases or by order of the AOGC, not less than ten (10) business days before due, pay Underlying Owner necessary amounts (in accordance with Section 5.5(d)) in immediately available funds for royalties and other costs allocable to Commercial Production and otherwise payable by the Underlying Owner to the lessors of the Exercised Leases;

(f)as soon as it is available, provide Underlying Owner with any and all reports containing production data reasonably required by Underlying Owner to confirm the amount in royalties paid by Underlying Owner on behalf of Optionee and, if Underlying Owner was required to pay more to Third Parties than the amount paid by Optionee to Underlying Owner pursuant to Section 5.5(e), promptly pay Underlying Owner the shortfall in immediately available funds;

(g)pay all taxes owed in connection with Commercial Production (including but not limited to sales, use and severance taxes);

(h)at the request of the Underlying Owner, provide Underlying Owner with samples of any brine produced under the Exercised Leases, for the purposes of testing and analysis; and

(i)conduct Development Operations in accordance with the terms of this Agreement, the Exercised Leases and all applicable laws and regulations.

5.6Contemporaneous Operations and Processing. The Parties contemplate that they shall each have a coequal right for Underlying Owner to conduct operations, and for Optionee to conduct Exploratory Operations on the Leases during the Exploratory Period. Furthermore, the Parties shall have a coequal right to conduct operations during the Lease Period on any Exercised Leases, and in no event shall Underlying Owner’s right to operate on the lands comprising the Exercised Leases be subordinate to Optionee’s Development Operations. In the event that Underlying Owner (or any third party acting by, through, or under the Underlying Owner) begins exploration or production activities of any kind on a portion of the Exercised Leases, Optionee shall have the same rights with respect to post-extraction brine so produced by the Underlying Owner (or any third party acting by, through, or under the Underlying Owner) solely with respect to the extraction of Extracted Materials as are granted to the Underlying Owner in Section 5.7(a).

5.7Post-Extraction Brine.

(a)The Underlying Owner may, at the Underlying Owner's sole option, require Optionee to deliver to Underlying Owner all or any part of the brine remaining after Optionee’s extraction of Extracted Minerals. In that event, any cost of Underlying Owner's taking of such post-

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extraction brine, including, without limitation, transportation and further processing, shall be borne exclusively by the Underlying Owner.

(b)Optionee shall dispose of all post-extraction brine, whether resulting from its Development Operations or Underlying Owner’s operations with respect to the post-extraction brine identified in Section 5.7(a), into one or more brine disposal wells in compliance with the rules and regulations of those agencies having jurisdiction thereof including, without limitation, the AOGC and the Arkansas Department of Environmental Quality.

(c)In the event that Development Operations conducted by the Optionee result in the extraction of by-product materials of commercial value which do not constitute Extracted Materials and which can otherwise be separated from the Extracted Materials, the Underlying Owner shall have the option to acquire such by-product materials at a rate, and on additional terms, to be negotiated between the Parties. If the Underlying Owner declines to exercise its option to acquire such by-product materials, they shall become part of post-extraction brine disposed of by Optionee.

5.8Renewals.

(a)Subject to Section 5.8(b), the Underlying Owner will use commercially reasonable efforts to renew (i) any of the Leases which would otherwise expire during the Exploratory Period, and (ii) if Commercial Production has not yet begun, on any of the Exercised Leases, on a form of renewal document which is substantially the same as that of the Ratification, Extension and Renewal of Brine Lease set forth on Exhibit C, or other form which is reasonably acceptable to both the Underlying Owner and the Optionee.

(b)The Optionee will, promptly upon request from the Underlying Owner, reimburse the Underlying Owner for [***] percent ([***]%) of any portion of the renewal bonuses paid by the Underlying Owner to the lessors of the Leases (including any Exercised Leases) that exceeds, in the aggregate from the Agreement Date, $[***] but does not exceed, in the aggregate, $[***] and [***] ([***]%) of any amount in excess of $[***] in the aggregate. Notwithstanding the terms of Section 5.8(a), Underlying Owner will not be obligated to renew any Leases which cannot, after reasonable negotiation efforts, be renewed for a renewal bonus of $[***] or less per net brine acre covered by such Leases. In any event, any amounts in excess of $[***] per net brine acre shall be the sole responsibility of Optionee. Underlying Owner will notify Optionee concerning any Leases which cannot be successfully renewed within the parameters above, after which Optionee may attempt to negotiate renewal of such Leases on any terms acceptable to Optionee. However, that portion of any renewal bonus which exceeds $[***], per net brine acre shall become the sole expense of Optionee and shall not be considered in the computation of Optionee’s duty to reimburse Underlying Owner pursuant to this Section 5.8.

5.9If any regulation of the AOGC, or any applicable law or regulation, imposes any requirement on Underlying Owner to post any bond or security, or results in any additional obligation on Underlying Owner that is based on Optionee’s activities under this Agreement, or on the lands comprising any Exercised Lease, the Parties shall promptly negotiate a mechanism for Optionee to satisfy all such requirements or obligations to Underlying Owner’s reasonable

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satisfaction, under the principle that Optionee should bear such requirements or obligations at its sole expense and liability.

ARTICLE 6 - TERMINATION

6.1Subject to the immediately following sentence, if at any time the Optionee fails to perform any obligation required to be performed by it hereunder, or the Optionee is otherwise in breach of a representation, warranty or a covenant given by it hereunder, then the Underlying Owner may terminate this Agreement, but only after it shall have first given written notice of default to the Optionee and the Optionee has not cured the default within sixty (60) calendar days following delivery of the notice of default. Furthermore, and notwithstanding anything to the contrary in the immediately preceding sentence, in the event that Optionee (i) does not pay any amounts to Underlying Owner under Section 3.5 when due, or (ii) fails to deliver to Underlying Owner the reports referenced in Section 5.5(f), then Underlying Owner shall have the right to terminate this Agreement, but only after it shall have first given written notice of default to the Optionee and the Optionee has not cured the default within fifteen (15) calendar days following delivery of the notice of default. In such event, Optionee hereby authorizes Underlying Owner to execute and record releases of all Limited Mineral Assignments made to Optionee, on Optionee’s behalf. Such right to terminate this Agreement, whether or not exercised by Underlying Owner shall not be an exclusive remedy but is in addition to all other remedies which Underlying Owner might exercise.

6.2Provided that the Option has not been exercised, Optionee may terminate this Agreement at any time after it makes the payment described in Section 3.5(b) by giving written notice of such termination to Underlying Owner not less than ninety (90) calendar days prior to the date that the next payment by Optionee is due under Section 3.5(c), Section 3.5(d) or Section 3.5(e), as the case may be. In such case, Optionee shall not be required to make any further payments under Section 3.5 after the date of such termination.

6.3Notwithstanding any other provisions of this Agreement, in the event of termination of this Agreement, Optionee will at all times comply with (i) Section 5.1 and Section 11.6, and (ii) all applicable laws, rules and obligations, including those of the AOGC, the Arkansas Department of Environmental Quality, the terms of the Leases, and the common law of the State of Arkansas as it pertains to the plugging and abandonment of wells, removal of pipelines and surface equipment, and restoration of the surface of the lands on which the Optionee has conducted Exploratory Operations or Development Operations.

ARTICLE 7 - TRANSFERS

7.1Except in the event of a transfer to an Affiliate or the Optionee Parent, the Optionee shall not be permitted to transfer all or any part of its rights or obligations under this Agreement without the prior written consent of the Underlying Owner, which consent shall not be unreasonably withheld.

7.2The Underlying Owner may assign, transfer and convey the Royalty, its interest in and to this Agreement, and the Leases to any Affiliate, provided that any such transferee agrees to be bound by the terms of this Agreement as though they were a Party to this Agreement, and the Underlying Owner provides prior written notice to the Optionee. Furthermore, the Underlying Owner may mortgage, pledge or charge the Royalty and its interest in and to

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this Agreement to any financial institution or other provider of debt or equity financing, or to any other person or entity.

ARTICLE 8 - CONFIDENTIAL INFORMATION

8.1Except as required by law or the rules of an applicable stock exchange, during the term of this Agreement and for a period of [***] years after termination or expiry of this Agreement for any reason, the Parties shall keep confidential the terms of this Agreement and all Confidential Information.

8.2During the term of this Agreement and for a period of [***] years after termination or expiry of this Agreement for any reason, Receiving Party agrees not to: (a) use Disclosing Party’s Confidential Information for any reason, other than to carry out its activities and obligations under this Agreement; and (b) disclose Disclosing Party’s Confidential Information to any individual or third party except to its employees, consultants, directors, attorneys, advisors and its Affiliates that (i) have a “need to know” such Confidential Information for furtherance of the Purpose, and (ii) are bound to confidentiality under terms no less protective than the terms of this Agreement (collectively, “Authorized Recipients”). Receiving Party shall implement and maintain appropriate organizational, technical, and administrative security measures, exercising the same degree of care in protecting Disclosing Party’s Confidential Information that it uses for its own confidential information of a similar nature, but in no event less than reasonable care. Promptly after becoming aware of any unauthorized use or disclosure of, and/or unauthorized attempts to access or modify, any of Disclosing Party’s Confidential Information in the custody or control of Receiving Party or its Authorized Recipients, Receiving Party shall notify Disclosing Party in writing and cooperate with Disclosing Party to investigate and mitigate any adverse effects therefrom. Receiving Party shall be responsible for any unauthorized use or disclosure of Confidential Information by any of its Authorized Recipients.

8.3The Parties acknowledge and agree that any breach or threatened breach of this Article 8 by Receiving Party could cause harm to Disclosing Party for which money damages may not provide an adequate remedy. The Parties agree that in the event of such a breach or threatened breach of this Agreement, in addition to any other available remedies, Disclosing Party may seek temporary and permanent injunctive relief, without the necessity of posting a bond or other security, restraining Receiving Party from disclosing or using, in whole or in part, any Confidential Information.

ARTICLE 9 - NOTICES

9.1Any notice or other writing required or permitted to be given hereunder or for the purposes of this Agreement to either the Underlying Owner, the Optionee, or the Optionee Parent, shall be sufficiently given if delivered personally or transmitted by facsimile:

(a)In the case of a notice to the Underlying Owner, at its address shown on the first page of this Agreement, to the attention of [***], Vice-President – Chemicals. The facsimile number is (281) 364-4398.

(b)In the case of a notice to the Underlying Owner, a copy of such notice shall be sent to the attention of the General Counsel, at its address shown on the first page of this Agreement. The facsimile number is (281) 364-4398.

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(c)In the case of a notice to the Optionee, or the Optionee Parent, at their address as shown on the first page of this Agreement, to the attention of [***], Chief Executive Officer. The facsimile number is [•].

or at such other address or addresses as the Parties to whom such writing is to be given shall have last notified the Party giving the same in the manner provided in this Section 9.1. Any notice delivered to the Party to whom it is addressed as provided in this Agreement shall be deemed to have been given and received on the day it is so delivered at such address, provided that if such day is not a Business Day, then the notice shall be deemed to have been given and received on the Business Day next following such day. Any notice transmitted by facsimile shall be deemed to be given and received on the first Business Day after its transmission (provided that such facsimile is promptly followed by a mailed notice).

ARTICLE 10 - INDEMNIFICATION

10.1The Underlying Owner agrees to release, defend, indemnify and hold each of the Optionee and the Optionee Parent harmless from and against any and all Claims arising from Environmental Liability suffered or incurred by either of the Optionee or the Optionee Parent to the extent arising from any operations or activities conducted by the Underlying Owner, or its employees or agents, in or on the property comprising the Leases.

10.2The Optionee agrees to release, defend, indemnify and hold the Underlying Owner harmless from and against any and all Claims arising from Environmental Liability suffered or incurred by the Underlying Owner to the extent arising from any operations or activities conducted by the Optionee, or its employees or agents, in or on the property comprising the Leases.

10.3The Underlying Owner shall release, defend, indemnify and hold the Optionee Group harmless from and against any and all Claims brought by any person, party or entity, arising out of (1) injury to, sickness, disease or death of any member of Underlying Owner Group, and/or (2) damage to or loss or destruction of property owned, leased, rented, hired or chartered by any member of Underlying Owner Group arising out of this Agreement, REGARDLESS OF FAULT.

10.4The Optionee shall release, defend, indemnify and hold Underlying Owner Group harmless from and against any and all Claims brought by any person, party or entity, arising out of (1) injury to, sickness, disease or death of any member of Optionee Group, and/or (2) damage to or loss or destruction of property owned, leased, rented, or hired by any member of Optionee Group, arising out of the performance of this Agreement, REGARDLESS OF FAULT.

10.5Each Party (the “Indemnitor”) shall release, defend, indemnify and hold harmless the other Party (the “Indemnitee”) and its respective Group from and against any and all Claims for personal injury to, illness or death of any Third Party, or for damage to or loss or destruction of the property of any Third Party, to the extent that any such Claim arises out of Indemnitor’s activities under this Agreement (including, without limitation, Optionee’s Exploratory Operations and Development Operations) and is attributable to the negligence, strict liability, or other fault of the Indemnitor or any member of its respective Group.

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10.6The indemnities in this Agreement shall only be effective to the maximum extent permitted by applicable law. If any law is enacted in any state that limits in any way the extent of which indemnification may be provided to an indemnitee and such law is applicable to activities undertaken pursuant to this Agreement, then the Agreement shall automatically be amended to provide that the indemnification given hereunder shall extend only to the maximum extent permitted by such law.

10.7Each Party shall support its indemnity obligations hereunder with the minimum insurance requirements set forth on Exhibit D for the duration of this Agreement. Except to the extent mandated by law, the minimum insurance requirements hereunder are not intended to limit, in any way, the indemnity obligations set forth above.

10.8If indemnification pursuant to this Article 10 is sought, the Indemnitee shall give written notice to the Indemnitor of an event giving rise to the obligation to indemnify, describing in reasonable detail the factual basis for such claim, and shall allow the Indemnitor to assume and conduct the defense of the claim or action with counsel reasonably satisfactory to the Indemnitee, and shall cooperate with the Indemnitor in the defense thereof; provided, however, that the omission to give such notice to the Indemnitor shall not relieve the Indemnitor from any liability which it may have to the Indemnitee, except to the extent that the Indemnitor is prejudiced by the failure to give such notice. The Indemnitee shall have the right to employ separate counsel to represent the Indemnitee if the Indemnitee is advised by counsel that an actual conflict of interest makes it advisable for the Indemnitee to be represented by separate counsel, and the reasonable expenses and fees of such separate counsel shall be paid by the Indemnitor.

ARTICLE 11 - GENERAL

11.1No consent or waiver expressed or implied by any Party in respect of any breach or default by any other Party in the performance by such other of its obligations hereunder shall be deemed or construed to be a consent to or a waiver of any other breach of default.

11.2No investigation made by or on behalf of the Parties or any of their respective advisors or agents at any time shall have the effect of waiving, diminishing the scope of or otherwise affecting any representation or warranty made or incorporated by reference herein by the other Parties to this Agreement or made pursuant thereto. No waiver by the Parties of any condition, in whole or in part, shall operate as a waiver of any other condition.

11.3All statements contained in any certificate or other instrument delivered by or on behalf of any Party pursuant to this Agreement or in connection with the transactions contemplated by this Agreement shall be deemed to be made by such Party hereunder.

11.4The Parties shall promptly execute or cause to be executed all documents, deeds, conveyances and other instruments of further assurance and do such further and other acts which may be reasonably necessary or advisable to carry out fully and effectively the intent and purpose of this Agreement or to record wherever appropriate the respective interests from time to time of the Parties in the Leases.

11.5Each Party will bear its own expenses in connection with the transactions contemplated by this Agreement, including, without limitation, the costs and

- 17 -

expenses of all attorneys, engineers, brokers, investment bankers, agents and finders employed by such Party; provided that the Optionee Parent shall reimburse the Underlying Owner for [***] ([***]%) of the costs and expenses of legal counsel retained by the Underlying Owner in connection with this Agreement, to a maximum reimbursement amount of $[***].

11.6Unless earlier terminated pursuant to the terms hereof, this Agreement shall remain in full force and effect for the duration of the life of any Exercised Leases. Notwithstanding anything to the contrary herein, (i) all covenants of the Parties shall survive any termination of this Agreement for the duration of the obligation of any such covenant, and (ii) all indemnity and defense obligations of the Parties shall survive indefinitely.

11.7This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.

11.8This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, and the Parties submit to the exclusive jurisdiction of the courts of the State of Texas in respect of all disputes arising hereunder, provided that any issues related to title of the Leases shall be construed in accordance with the laws of the State of Arkansas.

11.9Neither Party shall be entitled to recover from the other, or their respective Affiliates, any special, indirect, consequential, punitive, exemplary, remote or speculative damages, or damages for lost profits of any kind arising under or in connection with this Agreement or the transactions contemplated hereby, except to the extent any such Party suffers such damages to a Third Party, which damages (including costs of defense and reasonable attorneys’ fees incurred in connection with defending against such damages) shall not be excluded by this provision as to recovery hereunder. Subject to the preceding sentence, Underlying Owner, on behalf of each member of the Underlying Owner Group, and Optionee, on behalf of each member of the Optionee Group, waive any right to recover special, indirect, consequential, punitive, exemplary, remote or speculative damages, or damages for lost profits of any kind, arising in connection with or with respect to this Agreement or the transactions contemplated hereby.

11.10Time shall be of the essence in this Agreement.

11.11The preamble and Schedules attached to this Agreement shall be deemed to be incorporated in, and to form part of, this Agreement.

11.12Wherever the neuter and singular is used in this Agreement it shall be deemed to include the plural, masculine and feminine, as the case may be.

11.13The word “or” shall not be exclusive and the word “including” shall not be limiting (whether or not non-limiting language such as “without limitation” or “but not limited to” or other words of similar import is used with reference thereto).

11.14Nothing contained in this Agreement shall be deemed to constitute either Party to this Agreement the partner of the other nor to create any fiduciary relationship between them, nor, except as otherwise herein expressly provided, to constitute either the Optionee, the Optionee Parent or the Underlying Owner as the agent or legal representative of the other. It is not the intention of the Parties to this Agreement to create, nor shall this Agreement be construed to create, any partnership or agency relationship between any of the Parties. None of the Parties shall have any authority to act for or to assume any obligation or

- 18 -

responsibility on behalf of the other Parties, except as otherwise expressly provided herein.

11.15If any provisions of this Agreement shall be invalid, illegal or unenforceable in any respect under any applicable law, such provision may be severed from this Agreement, and the validity, legality and enforceability of the remaining provisions hereof shall not be affected or impaired by reason thereof.

11.16The Parties acknowledge that they have each had the opportunity to consult with independent counsel in connection with the transactions contemplated by this Agreement and this Agreement is the result of the informed negotiation between the Parties. Therefore this Agreement should not be construed against either Party by virtue of such Party having been its drafter.

11.17This Agreement may be signed by the Parties in counterparts and may be delivered by facsimile or other form of electronic transmission, each of which when delivered will be deemed to be an original and all of which together will constitute one instrument.

[Signature Page to Follow]

- 19 -

Execution Copy

IN WITNESS WHEREOF the Parties to this Agreement have executed this Agreement as of the day and year first above written.


TETRA TECHNOLOGIES, INC.


By:
						Jim Funke, Vice President – Chemicals


ARKANSAS LITHIUM CORP.


By:
						Robert Mintak, Director


STANDARD LITHIUM LTD.


By:
						Robert Mintak, Chief Executive Officer

Exhibit 31.1

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Brady M. Murphy, certify that:

1.I have reviewed this report on Form 10-Q for the fiscal quarter ended September 30, 2023, of TETRA Technologies, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.


Date:	October 30, 2023	/s/Brady M. Murphy
		Brady M. Murphy
		President and
		Chief Executive Officer

Exhibit 31.2

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Elijio V. Serrano, certify that:

1.I have reviewed this report on Form 10-Q for the fiscal quarter ended September 30, 2023, of TETRA Technologies, Inc.;

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.


Date:	October 30, 2023	/s/Elijio V. Serrano
		Elijio V. Serrano
		Senior Vice President and Chief Financial Officer

Exhibit 32.1

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Brady M. Murphy, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated:	October 30, 2023	/s/Brady M. Murphy
		Brady M. Murphy
		President and Chief Executive Officer
		TETRA Technologies, Inc.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Elijio V. Serrano, Senior Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated:	October 30, 2023	/s/Elijio V. Serrano
		Elijio V. Serrano
		Senior Vice President and Chief Financial Officer
		TETRA Technologies, Inc.

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2023	Oct. 27, 2023
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	1-13455
Entity Registrant Name	TETRA Technologies, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	74-2148293
Entity Address, Address Line One	24955 Interstate 45 North
Entity Address, City or Town	The Woodlands,
Entity Address, Postal Zip Code	77380
Entity Address, State or Province	TX
City Area Code	281
Local Phone Number	367-1983
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Common Stock Shares Outstanding		130,079,173
Entity Central Index Key	0000844965
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock
Trading Symbol	TTI
Security Exchange Name	NYSE
Series A Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Preferred Share Purchase Right
Trading Symbol	N/A
Security Exchange Name	NYSE

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenues from external customers	$ 151,464	$ 135,012	$ 473,136	$ 405,765
Cost of Goods and Services Sold [Abstract]
Depreciation, amortization, and accretion	8,578	8,634	25,705	24,061
Impairment and other charges	0	0	777	2,262
Insurance recoveries associated with damaged equipment	0	0	2,850	3,750
Total cost of revenues	113,540	105,539	349,734	315,765
Gross profit	37,924	29,473	123,402	90,000
Exploration and pre-development costs	3,775	936	6,836	3,500
General and administrative expense	23,838	23,833	73,254	68,096
Interest expense, net	5,636	3,999	16,672	10,933
Other income, net	(2,041)	(1,410)	(8,690)	(4,858)
Income before taxes and discontinued operations	6,716	2,115	35,330	12,329
Provision for income taxes	1,248	2,178	5,612	2,899
Income (loss) before discontinued operations	5,468	(63)	29,718	9,430
Income (loss) from discontinued operations, net of taxes	(48)	319	(68)	270
Net income	5,420	256	29,650	9,700
Loss attributable to noncontrolling interests	0	22	25	43
Net income attributable to TETRA stockholders	$ 5,420	$ 278	$ 29,675	$ 9,743
Basic net income per common share:
Income from continuing operations	$ 0.04	$ (0.00)	$ 0.23	$ 0.08
Net income attributable to TETRA stockholders	$ 0.04	$ 0.00	$ 0.23	$ 0.08
Weighted average basic shares outstanding (in shares)	129,777	128,407	129,395	127,890
Diluted net income per common share:
Income (loss) from continuing operations (in dollars per share)	$ 0.04	$ (0.00)	$ 0.23	$ 0.08
Net income attributable to TETRA stockholders (in dollars per share)	$ 0.04	$ 0.00	$ 0.23	$ 0.08
Weighted average diluted shares outstanding (in shares)	132,089	128,407	130,835	129,704
Product sales
Revenues from external customers	$ 68,967	$ 55,494	$ 230,719	$ 195,850
Cost of Goods and Services Sold [Abstract]
Cost of product sales	41,410	36,571	139,678	130,916
Services
Revenues from external customers	82,497	79,518	242,417	209,915
Cost of Goods and Services Sold [Abstract]
Cost of product sales	$ 63,552	$ 60,334	$ 186,424	$ 162,276

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 5,420	$ 256	$ 29,650	$ 9,700
Foreign currency translation adjustment from continuing operations, net of taxes of $0 in 2023 and 2022	(2,750)	(3,873)	(284)	(7,095)
Unrealized gain (loss) on investment in CarbonFree	146	(306)	474	(306)
Comprehensive income (loss)	2,816	(3,923)	29,840	2,299
Less: Comprehensive loss attributable to noncontrolling interests	0	22	25	43
Comprehensive income (loss) attributable to TETRA stockholders	$ 2,816	$ (3,901)	$ 29,865	$ 2,342

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Foreign currency translation adjustment, tax	$ 0	$ 0	$ 0	$ 0

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 33,826	$ 13,592
Trade accounts receivable, net of allowances of $508 in 2023 and $538 in 2022	122,900	129,631
Inventories	92,128	72,113
Prepaid expenses and other current assets	21,575	23,112
Total current assets	270,429	238,448
Property, plant, and equipment:
Land and building	23,308	25,723
Machinery and equipment	309,082	318,693
Automobiles and trucks	10,379	11,832
Chemical plants	63,912	63,528
Construction in progress	4,461	7,660
Total property, plant, and equipment	411,142	427,436
Less accumulated depreciation	(305,063)	(325,856)
Net property, plant, and equipment	106,079	101,580
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization of $49,904 in 2023 and $46,996 in 2022	30,132	32,955
Operating lease right-of-use assets	34,227	33,818
Investments	16,405	14,286
Other assets	15,147	13,279
Total other assets	95,911	94,338
Total assets	472,419	434,366
Current liabilities:
Trade accounts payable	50,322	49,121
Current portion of long-term debt	1,911	3
Compensation and employee benefits	31,090	30,958
Operating lease liabilities, current portion	8,745	7,795
Accrued taxes	10,777	9,913
Accrued liabilities and other	23,281	25,557
Current liabilities associated with discontinued operations	414	920
Total current liabilities	126,540	124,267
Long-term debt, net	156,748	156,455
Operating lease liabilities	28,013	28,108
Asset retirement obligations	14,132	13,671
Deferred income taxes	1,890	2,038
Other liabilities	3,959	3,430
Total long-term liabilities	204,742	203,702
Commitments and contingencies (Note 7)
Equity:
Common stock, par value 0.01 per share; 250,000,000 shares authorized at September 30, 2023 and December 31, 2022; 133,217,848 shares issued at September 30, 2023 and 131,800,975 shares issued at December 31, 2022	1,332	1,318
Additional paid-in capital	482,709	477,820
Treasury stock, at cost; 3,138,675 shares held at September 30, 2023 and December 31, 2022	(19,957)	(19,957)
Accumulated other comprehensive loss	(48,873)	(49,063)
Retained deficit	(272,818)	(302,493)
Total TETRA stockholders’ equity	142,393	107,625
Noncontrolling interests	(1,256)	(1,228)
Total equity	141,137	106,397
Total liabilities and equity	$ 472,419	$ 434,366

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Trade accounts receivable, allowances for doubtful accounts	$ 508	$ 538
Patents, trademarks, and other intangible assets, accumulated amortization	$ 49,904	$ 46,996
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	133,217,848	131,800,975
Treasury stock, shares held	3,138,675	3,138,675

Consolidated Statement of Equity Statement - USD ($)
$ in Thousands

Total

Common Stock Par Value

Additional Paid-In Capital

Treasury Stock

Accumulated Other Comprehensive Income (Loss)

Unrealized Gain (Loss) on Investment

Retained Deficit

Noncontrolling Interest

Balance at beginning of period at Dec. 31, 2021

$ 98,563

$ 1,301

$ 475,624

$ (19,957)

$ (46,932)

$ 0

$ (310,332)

$ (1,141)

Net income, retained deficit

7,720

Net income

7,719

(1)

Translation adjustment, net of taxes

192

Comprehensive loss

7,911

Equity compensation expense

1,104

Other

(676)

(673)

(10)

Balance at end of period at Mar. 31, 2022

106,902

1,308

476,055

(19,957)

(46,740)

(302,612)

(1,152)

Balance at beginning of period at Dec. 31, 2021

98,563

1,301

475,624

(19,957)

(46,932)

(310,332)

(1,141)

Net income, retained deficit

9,743

Net income

9,700

Other comprehensive income (loss)

(306)

Comprehensive loss

2,299

Balance at end of period at Sep. 30, 2022

101,756

1,318

476,530

(19,957)

(54,027)

(306)

(300,589)

(1,213)

Balance at beginning of period at Mar. 31, 2022

106,902

1,308

476,055

(19,957)

(46,740)

(302,612)

(1,152)

Net income, retained deficit

1,745

Net income

1,725

(20)

Translation adjustment, net of taxes

(3,414)

Comprehensive loss

(1,689)

Equity compensation expense

1,159

Other

(836)

(833)

(9)

Balance at end of period at Jun. 30, 2022

105,536

1,314

476,381

(19,957)

(50,154)

(300,867)

(1,181)

Net income, retained deficit

278

Net income

256

(22)

Translation adjustment, net of taxes

(3,873)

Other comprehensive income (loss)

(306)

Comprehensive loss

(3,923)

Equity compensation expense

1,098

Other

(955)

(949)

(10)

Balance at end of period at Sep. 30, 2022

101,756

1,318

476,530

(19,957)

(54,027)

(306)

(300,589)

(1,213)

Balance at beginning of period at Dec. 31, 2022

106,397

1,318

477,820

(19,957)

(48,991)

(72)

(302,493)

(1,228)

Net income, retained deficit

6,040

Net income

6,033

(7)

Translation adjustment, net of taxes

1,421

Other comprehensive income (loss)

121

Comprehensive loss

7,575

Equity compensation expense

^[1]

3,514

Other

(1,333)

(1,341)

Balance at end of period at Mar. 31, 2023

116,153

1,325

479,993

(19,957)

(47,570)

(296,453)

(1,234)

Balance at beginning of period at Dec. 31, 2022

106,397

1,318

477,820

(19,957)

(48,991)

(72)

(302,493)

(1,228)

Net income, retained deficit

29,675

Net income

29,650

Other comprehensive income (loss)

474

Comprehensive loss

29,840

Balance at end of period at Sep. 30, 2023

141,137

1,332

482,709

(19,957)

(49,275)

402

(272,818)

(1,256)

Balance at beginning of period at Mar. 31, 2023

116,153

1,325

479,993

(19,957)

(47,570)

(296,453)

(1,234)

Net income, retained deficit

18,215

Net income

18,197

(18)

Translation adjustment, net of taxes

1,045

Other comprehensive income (loss)

207

Comprehensive loss

19,449

Equity compensation expense

1,507

Other

(52)

(2)

Balance at end of period at Jun. 30, 2023

137,057

1,327

481,448

(19,957)

(46,525)

256

(278,238)

(1,254)

Net income, retained deficit

5,420

Net income

5,420

Translation adjustment, net of taxes

(2,750)

Other comprehensive income (loss)

146

Comprehensive loss

2,816

Equity compensation expense

1,396

Other

(132)

(135)

(2)

Balance at end of period at Sep. 30, 2023

$ 141,137

$ 1,332

$ 482,709

$ (19,957)

$ (49,275)

$ 402

$ (272,818)

$ (1,256)

[1]	Equity-based compensation for the three months ended March 31, 2023 includes $2.3 million for a portion of short-term incentive compensation that was settled through grants of restricted stock units rather than cash.

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Operating activities:
Net income	$ 29,650	$ 9,700
Reconciliation of net income to net cash provided by operating activities:
Depreciation, amortization, and accretion	25,705	24,061
Impairment and other charges	777	2,262
Loss on investments	157	159
Equity-based compensation expense	4,199	3,361
Provision for credit losses	190	31
Amortization and expense of financing costs	2,707	2,378
Insurance recoveries associated with damaged equipment	(2,850)	(3,750)
Gain on sale of assets	(432)	(980)
Provision (benefit) for deferred taxes	(805)	(66)
Other non-cash credits	(916)	(359)
Changes in operating assets and liabilities:
Accounts receivable	7,600	(16,661)
Inventories	(19,990)	(5,707)
Prepaid expenses and other current assets	1,313	(3,782)
Trade accounts payable and accrued expenses	2,893	17,069
Other	1,133	(1,768)
Net cash provided by (used in) operating activities	51,331	25,948
Investing activities:
Purchases of property, plant, and equipment, net	(30,240)	(32,678)
Proceeds from sale of property, plant, and equipment	658	1,489
Proceeds from insurance recoveries associated with damaged equipment	2,850	3,750
Purchase of investments	(350)	0
Other investing activities	(1,836)	(841)
Net cash used in investing activities	(28,918)	(28,280)
Financing activities:
Proceeds from credit agreements and long-term debt	97,384	1,695
Principal payments on credit agreements and long-term debt	(98,441)	(3,292)
Payments on financing lease obligations	(837)	(1,174)
Net cash used in financing activities	(1,894)	(2,771)
Effect of exchange rate changes on cash	(285)	(1,201)
Increase (decrease) in cash and cash equivalents	20,234	(6,304)
Cash and cash equivalents at beginning of period	13,592	31,551
Cash and cash equivalents at beginning of period	$ 33,826	$ 25,247

Consolidated Statement of Equity (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Translation adjustment, tax	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
Share-based Payment Arrangement, Expense			$ 2,300

Organization, Basis of Presentation, and Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Organization, Basis of Presentation, and Significant Accounting Policies

ORGANIZATION, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization

Presentation

Tax Benefits Preservation Plan

such person or group acquires additional shares representing 2% of the Company’s then outstanding shares of Common Stock) without prior approval from the Board of Directors.

Mineral Resources Arrangement

Significant Accounting Policies

Use of Estimates

Reclassifications

Foreign Currency Translation

Fair Value Measurements

Supplemental Cash Flow Information

Supplemental cash flow information is as follows:


	Nine Months Ended September 30,
	2023		2022
	(in thousands)
Interest paid	$	14,282	$	11,578
Income taxes paid	$	3,918	$	2,525

	September 30, 2023		December 31, 2022
	(in thousands)
Accrued capital expenditures	$	1,271	$	4,901

New Accounting Pronouncements

Standards adopted during 2023

Discontinued Operations

9 Months Ended

Sep. 30, 2023

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

DISCONTINUED OPERATIONSOn March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division, consisting of our Offshore Services and Maritech segments. Our former Offshore Division is reported as discontinued operations for all periods presented. Our consolidated balance sheets and consolidated statements of operations report discontinued operations separate from continuing operations. Our consolidated statements of comprehensive income, statements of equity and statements of cash flows combine continuing and discontinued operations. Our loss from discontinued operations for the three and nine months ended September 30, 2023 consists primarily of general and administrative expense associated with our former Offshore Division. A summary of additional financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands, unaudited)


	Three Months Ended September 30, 2022
	Offshore Services
Major classes of line items constituting income from discontinued operations




General and administrative expense	$	510


Pretax loss from discontinued operations	(510)
Pretax gain on disposal of discontinued operations	829
Total pretax income from discontinued operations	319



Income from discontinued operations attributable to TETRA stockholders	$	319


	Nine Months Ended September 30, 2022
	Offshore Services		Maritech		Total
Major classes of line items constituting income from discontinued operations

Cost of revenues	$	54	$	—	$	54


General and administrative expense	533		—		533

Other income, net	—		(28)		(28)
Pretax income (loss) from discontinued operations	(587)		28		(559)
Pretax gain on disposal of discontinued operations					829
Total pretax income from discontinued operations					270



Income from discontinued operations attributable to TETRA stockholders					$	270

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)


	September 30, 2023
	Offshore Services		Maritech		Total
	(unaudited)









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	—		95		95


Total liabilities associated with discontinued operations	$	319	$	95	$	414


	December 31, 2022
	Offshore Services		Maritech		Total









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	506		95		601


Total liabilities associated with discontinued operations	$	825	$	95	$	920

Revenue from Contracts with Customers

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

REVENUE FROM CONTRACTS WITH CUSTOMERSOur contract asset balances, primarily associated with contractual invoicing milestones and/or customer documentation requirements, were $30.7 million and $33.1 million as of September 30, 2023 and December 31, 2022, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in thousands)
Completion Fluids & Products
United States	$	36,484	$	30,261	$	115,167	$	103,449
International	36,726		28,902		125,307		103,706
	73,210		59,163		240,474		207,155
Water & Flowback Services
United States	67,877		67,641		204,446		182,059
International	10,377		8,208		28,216		16,551
	78,254		75,849		232,662		198,610




Total Revenue
United States	104,361		97,902		319,613		285,508
International	47,103		37,110		153,523		120,257
	$	151,464	$	135,012	$	473,136	$	405,765

Inventories

9 Months Ended

Sep. 30, 2023

Inventory Disclosure [Abstract]

Inventories

INVENTORIES

Components of inventories as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023		December 31, 2022
	(in thousands)
Finished goods	$	79,689	$	60,481
Raw materials	4,313		3,734
Parts and supplies	6,622		6,432
Work in progress	1,504		1,466
Total inventories	$	92,128	$	72,113

Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling

Investments

9 Months Ended

Sep. 30, 2023

Investments in and Advances to Affiliates [Abstract]

Investments

INVESTMENTS

Our investments as of September 30, 2023 and December 31, 2022 consist of the following:


	September 30, 2023		December 31, 2022
	(in thousands)
Investment in CSI Compressco	$	7,228	$	6,967
Investment in CarbonFree	6,563		6,139
Investment in Standard Lithium	2,264		1,180
Other investments	350		—
Total Investments	$	16,405	$	14,286

See Note 8 - “Fair Value Measurements” for further information.

Long-Term Debt and Other Borrowings

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Debt Disclosure

LONG-TERM DEBT AND OTHER BORROWINGS

Consolidated long-term debt as of September 30, 2023 and December 31, 2022 consists of the following:


	Scheduled Maturity	September 30, 2023		December 31, 2022

		(in thousands)
Term Credit Agreement(1)	September 10, 2025	$	156,748	$	154,570
Asset-Based Credit Agreement(2)	May 31, 2025	—		1,885
Argentina Credit Agreement	October 19, 2023	1,900		—
Swedish Credit Facility	December 31, 2023	11		3
Total debt		158,659		156,458
Less current portion		(1,911)		(3)
Total long-term debt		$	156,748	$	156,455

Term Credit Agreement

ABL Credit Agreement

Argentina Credit Agreement

Swedish Credit Facility

Finland Credit Agreement

Covenants

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	COMMITMENTS AND CONTINGENCIES Litigation We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity. There have been no other material developments in our legal proceedings during the quarter ended September 30, 2023. For additional discussion of our legal proceedings, please see our 2022 Annual Report and Quarterly Report on Form 10-Q for the quarter ended June 30, 2023. Product Purchase Obligations In the normal course of our Completion Fluids & Products Division operations, we enter into supply agreements with certain manufacturers of various raw materials and finished products. Some of these agreements have terms and conditions that specify a minimum or maximum level of purchases over the term of the agreement. Other agreements require us to purchase the entire output of the raw material or finished product produced by the manufacturer. Our purchase obligations under these agreements apply only with regard to raw materials and finished products that meet specifications set forth in the agreements. We recognize a liability for the purchase of such products at the time we receive them. As of September 30, 2023, the aggregate amount of the fixed and determinable portion of the purchase obligation pursuant to our Completion Fluids & Products Division’s supply agreements was approximately $74.9 million, including $4.0 million for the remainder of 2023, $24.0 million in 2024, $21.9 million in 2025, $15.6 million in 2026, $7.1 million in 2027, and $2.3 million thereafter, extending through 2028

Fair Value Measurements

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

Financial Instruments

Investments


	Nine Months Ended September 30, 2023
	(in thousands)
Balance at beginning of period	$	6,139
Change in fair value of embedded option	(50)
Change in fair value of convertible note, excluding embedded option	474
Balance at end of period	$	6,563

Recurring fair value measurements by valuation hierarchy as of September 30, 2023 and December 31, 2022 are as follows:


			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	September 30, 2023		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	7,228	$	7,228	$	—	$	—
Investment in CarbonFree	6,563		—		—		6,563
Investment in Standard Lithium	2,264		2,264		—		—
Other investments	350		—		—		350

Total investments	$	16,405


			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	December 31, 2022		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	6,967	$	6,967	$	—	$	—
Investment in CarbonFree	6,139		—		—		6,139
Investment in Standard Lithium	1,180		1,180		—		—

Investments	$	14,286

Impairments

Other

Net Income per Share

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Net Income Per Share

NET INCOME PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income per common and common equivalent share:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
	(in thousands)
Number of weighted average common shares outstanding	129,777	128,407	129,395	127,890
Assumed vesting of equity awards	2,312	—	1,440	1,814
Average diluted shares outstanding	132,089	128,407	130,835	129,704

Industry Segments

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Industry Segments

INDUSTRY SEGMENTS

We manage our operations through two segments: Completion Fluids & Products Division and Water & Flowback Services Division.

Summarized financial information concerning the business segments is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	68,532	$	55,354	$	228,415	$	195,469
Water & Flowback Services Division	435		140		2,304		381
Consolidated	$	68,967	$	55,494	$	230,719	$	195,850

Services
Completion Fluids & Products Division	$	4,678	$	3,809	$	12,059	$	11,686
Water & Flowback Services Division	77,819		75,709		230,358		198,229
Consolidated	$	82,497	$	79,518	$	242,417	$	209,915

Total revenues
Completion Fluids & Products Division	$	73,210	$	59,163	$	240,474	$	207,155
Water & Flowback Services Division	78,254		75,849		232,662		198,610
Consolidated	$	151,464	$	135,012	$	473,136	$	405,765

Income (loss) before taxes and discontinued operations
Completion Fluids & Products Division	$	16,932	$	12,357	$	67,330	$	46,910
Water & Flowback Services Division	8,475		6,482		22,869		10,808
Interdivision Eliminations	—		3		—		9
Corporate Overhead(1)	(18,691)		(16,727)		(54,869)		(45,398)
Consolidated	$	6,716	$	2,115	$	35,330	$	12,329

(1) Amounts reflected include the following general corporate expenses:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
General and administrative expense	$	13,552	$	11,968	$	37,206	$	33,856
Depreciation and amortization	101		165		303		528
Impairments and other charges	—		—		777		—
Interest expense	5,755		4,437		17,029		11,978

Other general corporate (income) expense, net	(717)		157		(446)		(964)
Total	$	18,691	$	16,727	$	54,869	$	45,398

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net income, retained deficit	$ 5,420	$ 278	$ 29,675	$ 9,743

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Organization, Basis of Presentation, and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Principles of consolidation policy	Presentation Our unaudited consolidated financial statements include the accounts of our wholly owned or controlled subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended September 30, 2023 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2023. We have reflected the operations of our former Compression Division and Offshore Division as discontinued operations for all periods presented. See Note 2 - “Discontinued Operations” for further information. Unless otherwise noted, amounts and disclosures throughout these Notes to Consolidated Financial Statements relate solely to continuing operations and exclude all discontinued operations. The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission (“SEC”) and do not include all information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2022 and notes thereto included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2023 (the “2022 Annual Report”).
Tax Benefits Preservation Plan	Tax Benefits Preservation Plan On February 28, 2023, the Board of Directors adopted a Tax Benefits Preservation Plan (the “Tax Plan”) designed to protect the availability of the Company’s net operating loss carryforwards (“NOLs”) and other tax attributes (collectively, the “Tax Attributes”), which may be utilized in certain circumstances to reduce the Company’s future income tax obligations. The Tax Plan is intended to reduce the likelihood that any changes in the Company’s investor base would limit the Company’s future use of its Tax Attributes as a result of the Company experiencing an “ownership change” 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 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). In adopting the Tax Plan, the Board of Directors declared a dividend of one Series A Junior Participating Preferred Stock purchase right (the “Rights”) for each outstanding share of Common Stock pursuant to the terms of the Tax Plan. Initially, each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”) at a price of $20.00 per one one-thousandth of a share of Preferred Stock (the “Purchase Price”), subject to adjustment. The Rights will cause substantial dilution to a person or group that acquires 4.99% or more of the Common Stock (or to a person or group that already owns 4.99% or more of the Company’s Common Stock if such person or group acquires additional shares representing 2% of the Company’s then outstanding shares of Common Stock) without prior approval from the Board of Directors. The Rights will expire at the earliest of: (i) the close of business on February 28, 2026 (the “Final Expiration Date”); (ii) the time at which the Rights are redeemed pursuant to the Tax Plan, (iii) the time at which the Rights are exchanged pursuant to the Tax Plan; (iv) the closing of any merger or other acquisition transaction involving the Company pursuant to an agreement as described in the penultimate paragraph of Section 1.3 of the Tax Plan; (v) the close of business on the effective date of the repeal of Section 382 of the Code if the Board determines that the Tax Plan is no longer necessary or desirable for the preservation of the Tax Attributes; or (vi) the close of business on the first day of a taxable year of the Company following a Board determination that no Tax Attributes may be carried forward or otherwise utilized. The Tax Plan adopted by the Board of Directors is similar to plans adopted by other publicly held companies with significant NOLs or other substantial tax benefits and is not designed to prevent any action that the Board of Directors determines to be in the best interest of the Company and its stockholders. At the Company’s 2023 annual meeting of stockholders held on May 24, 2023, the Company’s stockholders ratified the adoption of the Tax Plan. The Rights are in all respects subject to and governed by the provisions of the Tax Plan. The foregoing summary provides only a general description of the Tax Plan and does not purport to be complete. The Tax Plan, which specifies the terms of the Rights and includes as Exhibit A the Form of Certificate of Designation of Series A Junior Participating Preferred Stock of the Company and as Exhibit B the Form of Right Certificate, is attached to the Company’s Current Report on Form 8-K, which was filed with the SEC on March 1, 2023, as Exhibit 4.1 and is incorporated herein by reference. The foregoing summary should be read together with the entire Tax Plan and is qualified in its entirety by reference to the Tax Plan.
Use of estimates policy	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.
Reclassifications	Reclassifications Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of reclassifications was not significant to the prior year's overall presentation.
Foreign currency translation policy	Foreign Currency Translation We have designated the Euro, the British pound, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Canada, Brazil, and certain of our operations in Mexico, respectively. The United States dollar is the designated functional currency for all of our other non-U.S. operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the United States dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) losses are included in other (income) expense, net and totaled less than $0.1 million and $0.3 million during the three and nine months ended September 30, 2023, respectively, and $(1.1) million and $(2.7) million during the three and nine months ended September 30, 2022, respectively.
Fair value measurements	Fair Value Measurements We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain investments. See Note 8 - “Fair Value Measurements” for further discussion. Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, including the impairment of long-lived assets (a Level 3 fair value measurement).
New accounting pronouncements	New Accounting Pronouncements Standards adopted during 2023 In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the previously-used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. On January 1, 2023, we adopted ASU 2016-13. The adoption of this standard did not have a material impact on our consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. In December 2022, the FASB issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.” During the three months ended June 30, 2023, our asset-based credit agreement and term credit agreement were amended to replace LIBOR and Eurodollar rates with the secured overnight financing rate (“SOFR”). There were no significant costs associated with the amendments and the amendments did not have a significant impact on our consolidated financial statements.

Organization, Basis of Presentation, and Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Schedule of Cash Flow, Supplemental Disclosures

Supplemental cash flow information is as follows:


	Nine Months Ended September 30,
	2023		2022
	(in thousands)
Interest paid	$	14,282	$	11,578
Income taxes paid	$	3,918	$	2,525

	September 30, 2023		December 31, 2022
	(in thousands)
Accrued capital expenditures	$	1,271	$	4,901

Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2023

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations

A summary of additional financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands, unaudited)


	Three Months Ended September 30, 2022
	Offshore Services
Major classes of line items constituting income from discontinued operations




General and administrative expense	$	510


Pretax loss from discontinued operations	(510)
Pretax gain on disposal of discontinued operations	829
Total pretax income from discontinued operations	319



Income from discontinued operations attributable to TETRA stockholders	$	319


	Nine Months Ended September 30, 2022
	Offshore Services		Maritech		Total
Major classes of line items constituting income from discontinued operations

Cost of revenues	$	54	$	—	$	54


General and administrative expense	533		—		533

Other income, net	—		(28)		(28)
Pretax income (loss) from discontinued operations	(587)		28		(559)
Pretax gain on disposal of discontinued operations					829
Total pretax income from discontinued operations					270



Income from discontinued operations attributable to TETRA stockholders					$	270

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)


	September 30, 2023
	Offshore Services		Maritech		Total
	(unaudited)









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	—		95		95


Total liabilities associated with discontinued operations	$	319	$	95	$	414


	December 31, 2022
	Offshore Services		Maritech		Total









Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	319	$	—	$	319

Accrued liabilities and other	506		95		601


Total liabilities associated with discontinued operations	$	825	$	95	$	920

Revenue from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in thousands)
Completion Fluids & Products
United States	$	36,484	$	30,261	$	115,167	$	103,449
International	36,726		28,902		125,307		103,706
	73,210		59,163		240,474		207,155
Water & Flowback Services
United States	67,877		67,641		204,446		182,059
International	10,377		8,208		28,216		16,551
	78,254		75,849		232,662		198,610




Total Revenue
United States	104,361		97,902		319,613		285,508
International	47,103		37,110		153,523		120,257
	$	151,464	$	135,012	$	473,136	$	405,765

Inventories (Tables)

9 Months Ended

Sep. 30, 2023

Inventory Disclosure [Abstract]

Schedule of Inventory

Components of inventories as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023		December 31, 2022
	(in thousands)
Finished goods	$	79,689	$	60,481
Raw materials	4,313		3,734
Parts and supplies	6,622		6,432
Work in progress	1,504		1,466
Total inventories	$	92,128	$	72,113

Investments (Tables)

9 Months Ended

Sep. 30, 2023

Investments in and Advances to Affiliates [Abstract]

Summary of Investments

Our investments as of September 30, 2023 and December 31, 2022 consist of the following:


	September 30, 2023		December 31, 2022
	(in thousands)
Investment in CSI Compressco	$	7,228	$	6,967
Investment in CarbonFree	6,563		6,139
Investment in Standard Lithium	2,264		1,180
Other investments	350		—
Total Investments	$	16,405	$	14,286

Long-Term Debt and Other Borrowings (Table)

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Long-Term Debt Table

Consolidated long-term debt as of September 30, 2023 and December 31, 2022 consists of the following:


	Scheduled Maturity	September 30, 2023		December 31, 2022

		(in thousands)
Term Credit Agreement(1)	September 10, 2025	$	156,748	$	154,570
Asset-Based Credit Agreement(2)	May 31, 2025	—		1,885
Argentina Credit Agreement	October 19, 2023	1,900		—
Swedish Credit Facility	December 31, 2023	11		3
Total debt		158,659		156,458
Less current portion		(1,911)		(3)
Total long-term debt		$	156,748	$	156,455

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value Measurements, Recurring and Nonrecurring

Recurring fair value measurements by valuation hierarchy as of September 30, 2023 and December 31, 2022 are as follows:


			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	September 30, 2023		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	7,228	$	7,228	$	—	$	—
Investment in CarbonFree	6,563		—		—		6,563
Investment in Standard Lithium	2,264		2,264		—		—
Other investments	350		—		—		350

Total investments	$	16,405


			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	December 31, 2022		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Investment in CSI Compressco	$	6,967	$	6,967	$	—	$	—
Investment in CarbonFree	6,139		—		—		6,139
Investment in Standard Lithium	1,180		1,180		—		—

Investments	$	14,286

Investment

The change in our investment in CarbonFree for the nine-month period ended September 30, 2023 is as follows:


	Nine Months Ended September 30, 2023
	(in thousands)
Balance at beginning of period	$	6,139
Change in fair value of embedded option	(50)
Change in fair value of convertible note, excluding embedded option	474
Balance at end of period	$	6,563

Net Income per Share (Tables)

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Schedule of Weighted Average Number of Share

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income per common and common equivalent share:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
	(in thousands)
Number of weighted average common shares outstanding	129,777	128,407	129,395	127,890
Assumed vesting of equity awards	2,312	—	1,440	1,814
Average diluted shares outstanding	132,089	128,407	130,835	129,704

Industry Segments (Tables)

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment Reporting Table

Summarized financial information concerning the business segments is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	68,532	$	55,354	$	228,415	$	195,469
Water & Flowback Services Division	435		140		2,304		381
Consolidated	$	68,967	$	55,494	$	230,719	$	195,850

Services
Completion Fluids & Products Division	$	4,678	$	3,809	$	12,059	$	11,686
Water & Flowback Services Division	77,819		75,709		230,358		198,229
Consolidated	$	82,497	$	79,518	$	242,417	$	209,915

Total revenues
Completion Fluids & Products Division	$	73,210	$	59,163	$	240,474	$	207,155
Water & Flowback Services Division	78,254		75,849		232,662		198,610
Consolidated	$	151,464	$	135,012	$	473,136	$	405,765

Income (loss) before taxes and discontinued operations
Completion Fluids & Products Division	$	16,932	$	12,357	$	67,330	$	46,910
Water & Flowback Services Division	8,475		6,482		22,869		10,808
Interdivision Eliminations	—		3		—		9
Corporate Overhead(1)	(18,691)		(16,727)		(54,869)		(45,398)
Consolidated	$	6,716	$	2,115	$	35,330	$	12,329

(1) Amounts reflected include the following general corporate expenses:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

	(in thousands)
General and administrative expense	$	13,552	$	11,968	$	37,206	$	33,856
Depreciation and amortization	101		165		303		528
Impairments and other charges	—		—		777		—
Interest expense	5,755		4,437		17,029		11,978

Other general corporate (income) expense, net	(717)		157		(446)		(964)
Total	$	18,691	$	16,727	$	54,869	$	45,398

Organization, Basis of Presentation, and Significant Accounting Policies - Additional Information (Details) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($) a $ / shares	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) a segment $ / shares	Sep. 30, 2022 USD ($)	Jun. 30, 2023 a	Feb. 28, 2023 $ / shares	Dec. 31, 2022 $ / shares
Dividends Payable [Line Items]
Number of Operating Segments \| segment			2
Foreign currency exchange (gains) and losses \| $	$ 100	$ (1,100)	$ 300	$ (2,700)
Preferred stock, dividend declared						1
Common stock, par value (in dollars per share)	$ 0.01		$ 0.01				$ 0.01
Number of shares owned						0.0499
Exploration and pre-development costs \| $	$ 3,775	$ 936	$ 6,836	$ 3,500
Gross brine lease acres \| a	40,000		40,000
Southwest Arkansas \| Saltwerx
Dividends Payable [Line Items]
Gross brine lease acres \| a					6,138
Common Stock
Dividends Payable [Line Items]
Shares outstanding						0.02
Preferred Stock
Dividends Payable [Line Items]
Preferred stock, par value(in dollars per share)						$ 0.01
Conversion price						$ 20.00

Organization, Basis of Presentation, and Significant Accounting Policies - Supplemental Cash Flows (Details) - USD ($) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Accounting Policies [Abstract]
Interest paid	$ 14,282	$ 11,578
Income taxes paid	3,918	$ 2,525
Capital Expenditures Incurred but Not yet Paid	$ 1,271		$ 4,901

Discontinued Operations - Loss from Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
General and administrative expense				$ 533
Pretax loss from discontinued operations				(559)
Pretax gain on disposal of discontinued operations				829
Total pretax income from discontinued operations				270
Income (loss) from discontinued operations, net of taxes	$ (48)	$ 319	$ (68)	270
Income from discontinued operations attributable to TETRA stockholders				270
Cost of revenues				54
Other income, net				(28)
Offshore Services
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
General and administrative expense		510		533
Pretax loss from discontinued operations		(510)		(587)
Pretax gain on disposal of discontinued operations		829
Total pretax income from discontinued operations		319
Income (loss) from discontinued operations, net of taxes		$ 319
Cost of revenues				54
Other income, net				0
Maritech
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
General and administrative expense				0
Pretax loss from discontinued operations				28
Cost of revenues				0
Other income, net				$ (28)

Discontinued Operations - Presented Separately in the Statement of Financial Position (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Trade payables	$ 319	$ 319
Accrued liabilities and other	95	601
Total liabilities associated with discontinued operations	414	920
Offshore Services
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Trade payables	319	319
Accrued liabilities and other	0	506
Total liabilities associated with discontinued operations	319	825
Maritech
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Trade payables	0	0
Accrued liabilities and other	95	95
Total liabilities associated with discontinued operations	$ 95	$ 95

Revenue from Contracts with Customers - Additional Information (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) segment	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Contract with customer, asset balances	$ 30,700		$ 30,700		$ 33,100
Purchase order	4,000		4,000		$ 3,700
Deferred revenue, revenue recognized	1,200	$ 2,600	1,600	$ 1,700
Income recognized	2,041	1,410	$ 8,690	4,858
Number of Reportable Segments \| segment			2
Standard Lithium Ltd.
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Income recognized	$ 700	$ 900	$ 2,400	$ 2,400

Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Disaggregation of Revenue [Line Items]
Revenues from external customers	$ 151,464	$ 135,012	$ 473,136	$ 405,765
United States
Disaggregation of Revenue [Line Items]
Revenues from external customers	104,361	97,902	319,613	285,508
International
Disaggregation of Revenue [Line Items]
Revenues from external customers	47,103	37,110	153,523	120,257
Completion Fluids & Products Division
Disaggregation of Revenue [Line Items]
Revenues from external customers	73,210	59,163	240,474	207,155
Completion Fluids & Products Division \| United States
Disaggregation of Revenue [Line Items]
Revenues from external customers	36,484	30,261	115,167	103,449
Completion Fluids & Products Division \| International
Disaggregation of Revenue [Line Items]
Revenues from external customers	36,726	28,902	125,307	103,706
Water & Flowback Services Division
Disaggregation of Revenue [Line Items]
Revenues from external customers	78,254	75,849	232,662	198,610
Water & Flowback Services Division \| United States
Disaggregation of Revenue [Line Items]
Revenues from external customers	67,877	67,641	204,446	182,059
Water & Flowback Services Division \| International
Disaggregation of Revenue [Line Items]
Revenues from external customers	$ 10,377	$ 8,208	$ 28,216	$ 16,551

Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Finished goods	$ 79,689	$ 60,481
Raw materials	4,313	3,734
Parts and supplies	6,622	6,432
Work in progress	1,504	1,466
Total inventories	$ 92,128	$ 72,113

Investments in and Advances to Affiliates (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021
Investments in and Advances to Affiliates [Line Items]
Investments	$ 16,405	$ 14,286
Total investments	$ 16,405	14,286
CSI Compressco
Investments in and Advances to Affiliates [Line Items]
Ownership percentage	3.70%
Total investments	$ 7,228	6,967
CarbonFree
Investments in and Advances to Affiliates [Line Items]
Investments			$ 5,000
Total investments	6,563	6,139
Standard Lithium
Investments in and Advances to Affiliates [Line Items]
Total investments	2,264	1,180
Other Investments
Investments in and Advances to Affiliates [Line Items]
Investments	350	$ 0
Total investments	$ 350

Long-Term Debt and Other Borrowings - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Total long-term debt	$ 156,748	$ 156,455
Parent Company
Debt Instrument [Line Items]
Long-term debt	158,659	156,458
Less current portion	(1,911)	(3)
Total long-term debt	156,748	156,455
Revolving Credit Facility \| Secured Debt
Debt Instrument [Line Items]
Long-term debt	11	3
Revolving Credit Facility \| Line of Credit \| Argentina Credit Agreement
Debt Instrument [Line Items]
Long-term debt	1,900	0
Asset-Based Credit Agreement \| Secured Debt
Debt Instrument [Line Items]
Long-term debt	0	1,885
Unamortized deferred finance costs		1,100
Deferred financing costs	700
Term Loan \| Secured Debt
Debt Instrument [Line Items]
Long-term debt	156,748	154,570
Unamortized deferred finance costs	3,800	5,100
Unamortized discount (premium), net	$ 2,500	$ 3,400

Long-Term Debt and Other Borrowings - Additional Information (Details)	9 Months Ended
	Sep. 30, 2023 USD ($)	Feb. 28, 2023	Dec. 31, 2022 USD ($)
Debt Instrument [Line Items]
Preferred Stock, Convertible, Conversion Ratio		0.001
Parent Company
Debt Instrument [Line Items]
Long-term debt	$ 158,659,000		$ 156,458,000
Parent Company \| Letter of Credit \| Asset-Based Lending Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	20,000,000
Line of Credit \| Revolving Credit Facility \| ABL Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	80,000,000
Accordion feature	20,000,000
Line of Credit \| Revolving Credit Facility \| Argentina Credit Agreement
Debt Instrument [Line Items]
Bank line of credit, net availability	$ 100,000
Interest rate	2.50%
Long-term debt	$ 1,900,000		0
Line of Credit \| Letter of Credit \| Sub-Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	15,000,000
Line of Credit \| Parent Company \| ABL Credit Agreement
Debt Instrument [Line Items]
Bank line of credit, letters of credit and guarantees	11,500,000
Debt instrument, face amount	$ 68,500,000
Secured Debt \| Variable Rate Component One
Debt Instrument [Line Items]
Prepay excess cash flow, threshold	0.50
Secured Debt \| Swedish Credit Facility
Debt Instrument [Line Items]
Bank line of credit, net availability	$ 4,600,000
Interest rate	2.95%
Secured Debt \| Letter of Credit
Debt Instrument [Line Items]
Credit outstanding	$ 1,400,000
Secured Debt \| Term Credit Agreement
Debt Instrument [Line Items]
Credit outstanding	$ 156,700,000
Interest rate	11.68%
Minimum business days from filing	5 days
Secured Debt \| Term Credit Agreement \| Variable Rate Component One
Debt Instrument [Line Items]
Leverage ratio	2.00
Secured Debt \| Term Credit Agreement \| Variable Rate Component Two
Debt Instrument [Line Items]
Prepay excess cash flow, threshold	0.25
Leverage ratio	1.50
Secured Debt \| Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt	$ 11,000		3,000
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement
Debt Instrument [Line Items]
Debt Instrument, Collateral, Percentage Of Equity Interest Issued By Certain Foreign Subsidiaries	65.00%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Minimum
Debt Instrument [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.375%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Maximum
Debt Instrument [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.50%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Fed Funds Effective Rate Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	0.50%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	0.10%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Risk Free Interest Rate
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	0.10%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Daily Simple Risk Free Rate For Sterling
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	0.0326%
Secured Debt \| Revolving Credit Facility \| Asset-Based Lending Credit Agreement \| Secured Overnight Financing Rate (SOFR) Adjusted For Required Bank Reserves
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	1.00%
Secured Debt \| Asset-Based Credit Agreement
Debt Instrument [Line Items]
Credit outstanding	$ 0
Long-term debt	0		1,885,000
Secured Debt \| Term Loan
Debt Instrument [Line Items]
Long-term debt	$ 156,748,000		$ 154,570,000
Secured Debt \| Term Loan \| Term Credit Agreement
Debt Instrument [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	100.00%
Debt Instrument, Collateral, Percentage Of Equity Interest Issued By Certain Foreign Subsidiaries	65.00%
Secured Debt \| Term Loan \| Term Credit Agreement \| London Interbank Offered Rate (LIBOR) 1
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	6.25%
Secured Debt \| Term Loan \| Term Credit Agreement \| Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)	5.25%
Swingline Loan Sublimit \| Parent Company \| Asset-Based Lending Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 11,500,000

Commitment and Contingencies (Details) $ in Millions	Sep. 30, 2023 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Purchase obligation	$ 74.9
Purchase obligation, remainder of 2023	4.0
Purchase obligation, 2024	24.0
Purchase obligation, 2025	21.9
Purchase obligation, 2026	15.6
Purchase obligation, 2027	7.1
Purchase obligation, thereafter	$ 2.3

Fair Value Measurements - CarbonFree (Details) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Investments in and Advances to Affiliates, at Fair Value [Roll Forward]
Balance at beginning of period			$ 14,286		$ 14,286
Change in fair value of embedded option	$ 2,041			$ 1,410	8,690	$ 4,858
Other comprehensive income (loss)	146	$ 207	121	(306)	474	(306)
Balance at end of period	16,405				16,405
(Level 3) \| CarbonFree
Investments in and Advances to Affiliates, at Fair Value [Roll Forward]
Balance at beginning of period			6,139		6,139
Balance at end of period	6,563				6,563
Unrealized Gain (Loss) on Investment
Investments in and Advances to Affiliates, at Fair Value [Roll Forward]
Other comprehensive income (loss)	$ 146			$ (306)
CarbonFree
Investments in and Advances to Affiliates, at Fair Value [Roll Forward]
Balance at beginning of period						$ 5,000
Change in fair value of embedded option					(50)
CarbonFree \| Unrealized Gain (Loss) on Investment
Investments in and Advances to Affiliates, at Fair Value [Roll Forward]
Other comprehensive income (loss)			$ 121		$ 474

Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Dec. 31, 2021
Derivatives, Fair Value [Line Items]
Investments	$ 16,405			$ 16,405		$ 14,286
Impairment and other charges	$ 0	$ 800	$ 0	$ 777	$ 2,262
CSI Compressco
Derivatives, Fair Value [Line Items]
Ownership percentage	3.70%			3.70%
CarbonFree
Derivatives, Fair Value [Line Items]
Investments							$ 5,000

Fair Value Measurements - Market Risks and Derivative Hedge Contracts (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Derivatives, Fair Value [Line Items]
Total investments	$ 16,405	$ 14,286
CSI Compressco
Derivatives, Fair Value [Line Items]
Total investments	7,228	6,967
CarbonFree
Derivatives, Fair Value [Line Items]
Total investments	6,563	6,139
Standard Lithium
Derivatives, Fair Value [Line Items]
Total investments	2,264	1,180
Other Investments
Derivatives, Fair Value [Line Items]
Total investments	350
(Level 1) \| CSI Compressco
Derivatives, Fair Value [Line Items]
Total investments	7,228	6,967
(Level 1) \| CarbonFree
Derivatives, Fair Value [Line Items]
Total investments	0	0
(Level 1) \| Standard Lithium
Derivatives, Fair Value [Line Items]
Total investments	2,264	1,180
(Level 1) \| Other Investments
Derivatives, Fair Value [Line Items]
Total investments	0
(Level 2) \| CSI Compressco
Derivatives, Fair Value [Line Items]
Total investments	0	0
(Level 2) \| CarbonFree
Derivatives, Fair Value [Line Items]
Total investments	0	0
(Level 2) \| Standard Lithium
Derivatives, Fair Value [Line Items]
Total investments	0	0
(Level 2) \| Other Investments
Derivatives, Fair Value [Line Items]
Total investments	0
(Level 3) \| CSI Compressco
Derivatives, Fair Value [Line Items]
Total investments	0	0
(Level 3) \| CarbonFree
Derivatives, Fair Value [Line Items]
Total investments	6,563	6,139
(Level 3) \| Standard Lithium
Derivatives, Fair Value [Line Items]
Total investments	0	$ 0
(Level 3) \| Other Investments
Derivatives, Fair Value [Line Items]
Total investments	$ 350

Net Income per Share - Reconciliation of the Weighted Average Number of Common Shares Outstanding (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]
Number of weighted average common shares outstanding ( in shares)	129,777	128,407	129,395	127,890
Assumed exercise of equity awards and warrants (in shares)	2,312	0	1,440	1,814
Average diluted shares outstanding (in shares)	132,089	128,407	130,835	129,704

Net Income per Share - Additional Information (Details) shares in Thousands	3 Months Ended
	Sep. 30, 2022 shares
Earnings Per Share [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	1,500

Industry Segments - Additional Details (Details)	9 Months Ended
Industry Segments - Additional Details (Details)	Sep. 30, 2023 segment
Segment Reporting [Abstract]
Number of Reportable Segments	2

Industry Segments - Revenue, Income from Operations, and Assets by Reporting Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Industry Segments Details [Line Items]
Revenues from external customers	$ 151,464	$ 135,012	$ 473,136	$ 405,765
Income before taxes and discontinued operations	6,716	2,115	35,330	12,329
Intersegment Eliminations
Industry Segments Details [Line Items]
Income before taxes and discontinued operations	0	3	0	9
Corporate, Non-Segment
Industry Segments Details [Line Items]
Income before taxes and discontinued operations	(18,691)	(16,727)	(54,869)	(45,398)
Completion Fluids & Products Division
Industry Segments Details [Line Items]
Revenues from external customers	73,210	59,163	240,474	207,155
Completion Fluids & Products Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	73,210	59,163	240,474	207,155
Income before taxes and discontinued operations	16,932	12,357	67,330	46,910
Water & Flowback Services Division
Industry Segments Details [Line Items]
Revenues from external customers	78,254	75,849	232,662	198,610
Water & Flowback Services Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	78,254	75,849	232,662	198,610
Income before taxes and discontinued operations	8,475	6,482	22,869	10,808
Product sales
Industry Segments Details [Line Items]
Revenues from external customers	68,967	55,494	230,719	195,850
Product sales \| Completion Fluids & Products Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	68,532	55,354	228,415	195,469
Product sales \| Water & Flowback Services Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	435	140	2,304	381
Services
Industry Segments Details [Line Items]
Revenues from external customers	82,497	79,518	242,417	209,915
Services \| Completion Fluids & Products Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	4,678	3,809	12,059	11,686
Services \| Water & Flowback Services Division \| Operating Segments
Industry Segments Details [Line Items]
Revenues from external customers	$ 77,819	$ 75,709	$ 230,358	$ 198,229

Industry Segments - Corporate Expenses (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Segment Reporting Information [Line Items]
General and administrative expense	$ 23,838		$ 23,833	$ 73,254	$ 68,096
Depreciation, amortization, and accretion	8,578		8,634	25,705	24,061
Impairment and other charges	0	$ 800	0	777	2,262
Interest expense, net	5,636		3,999	16,672	10,933
Other general corporate (income) expense, net	(2,041)		(1,410)	(8,690)	(4,858)
Total	(5,468)		63	(29,718)	(9,430)
Corporate, Non-Segment
Segment Reporting Information [Line Items]
General and administrative expense	13,552		11,968	37,206	33,856
Depreciation, amortization, and accretion	101		165	303	528
Impairment and other charges	0		0	777	0
Interest expense, net	5,755		4,437	17,029	11,978
Other general corporate (income) expense, net	(717)		157	(446)	(964)
Total	$ 18,691		$ 16,727	$ 54,869	$ 45,398