Desalination Dilemmas: Contradictory Signals in Eos Strategy, Regulatory Support, and Long-Term Opportunities

Strong Financial Performance in Q2 2025:
- TETRA Technologies reported record adjusted EBITDA of $68.1 million for the first 6 months of 2025, exceeding the upper range of guidance.
- This performance was driven by a record level of deepwater activity, including 25 deepwater jobs in Q1 and the completion of the 3-well Neptune project in Q2.

Deepwater Activity and Market Position:
- The company experienced an 11% sequential increase in revenue due to record deepwater activity, including a 25K completions award in the Gulf of America.
- This was attributed to TETRA's solid deepwater market positions and continuing strong performance in the industrial chemicals business.

Automation Technology and U.S. Onshore Operations:
- TETRA's automated technology fleet was fully utilized, supporting a decrease in U.S. land activity by 10% year-on-year, with a focus on produced water recycling and treatment.
- The company maintained its market share due to the automated technology's ability to reduce manpower and improve safety.

Electrolyte and Bromine Project Progress:
- Energy storage power capacity is expected to surpass 45 gigawatts by 2025, highlighting potential for zinc-based energy storage systems.
- TETRA received a 2-gigawatt hour annual capacity order from Eos, with preparations underway to meet increased demand by 2026.

Desalination and Water Management Initiatives:
- TETRA achieved its first revenue from Permian Basin produced water desalination, marking a significant milestone in the Oasis TDS technology pilot.
- The company is designing a 25K barrel per day desalination plant, with the aim of supporting produced water recycling and reuse due to growing regulatory support and industry demand.