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What changed in MAMMOTH ENERGY SERVICES, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of MAMMOTH ENERGY SERVICES, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+479 added−519 removedSource: 10-K (2025-03-07) vs 10-K (2024-03-01)

Top changes in MAMMOTH ENERGY SERVICES, INC.'s 2024 10-K

479 paragraphs added · 519 removed · 363 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

95 edited+34 added−35 removed176 unchanged
Biggest changeRisks Related to Our Business and the Industries We Serve • Failure by PREPA to pay the amounts owed to our infrastructure subsidiary Cobra for services performed would materially and adversely affect our financial condition, results of operations and cash flows. • Our customer base is concentrated and the loss of one or more of our significant customers, or their failure to pay the amounts they owe us, could cause our revenue to decline substantially. • We may experience losses in excess of our recorded reserves for receivables. • Our revolving credit facility and term credit facility impose restrictions on us that may affect our ability to successfully operate our business. • Volatility in the oil and natural gas markets has negatively impacted our business in the past, and could negatively impact our oilfield services business in the future. • Governmental laws, policies, regulations and subsidies, including initiatives to promote the use of renewable energy sources could create commodity volatility and negatively impact our oilfield services business. • A transition of the global energy sector from primarily a fossil fuel-based system to renewable energy sources could affect our customers ’ level of expenditures. • Shortages, delays in delivery and interruptions in supply of major components, replacement parts or, other equipment, supplies or materials may adversely affect our pressure pumping business and our drilling business. • Our business depends upon our ability to obtain specialized equipment and parts from third-party suppliers, and we may be vulnerable to delayed deliveries and future price increases. • Our failure to receive payment for contract change orders or adequately recover on claims brought by us against customers related to payment terms and costs could materially and adversely affect our business. • We may not accurately estimate the costs associated with infrastructure services provided under fixed price contracts, which could adversely affect our business, financial condition and cash flows. • We may be unable to obtain sufficient bonding capacity to support certain service offerings, and the need for performance and surety bonds could reduce availability under our credit facility. • The nature of our infrastructure services business exposes us to potential liability for warranty claims and faulty engineering, which may reduce our profitability. • Delays and reductions in government appropriations can negatively impact energy infrastructure engineering, design, construction, maintenance and repair projects and may impair the ability of our energy infrastructure customers to timely pay for products or services provided or result in their insolvency or bankruptcy. • Future performance of our natural sand proppant services business will depend on our ability to appropriately react to potential fluctuations in the demand for and supply of frac sand. • Increasing transportation and related costs could have a material adverse effect on our business. • Diminished access to water and inability to secure or maintain necessary permits may adversely affect operations of our frac sand processing plants. • Development of permanent infrastructure in the Canadian oil sands region or other locations where we locate our remote accommodations could negatively impact our remote accommodations business. • In the course of our business, we may become subject to lawsuits, indemnity or other claims, which could materially and adversely affect our business, results of operations and cash flows. 19 • We rely on a few key employees and skilled and qualified workers whose absence or loss could adversely affect our business. • Our operations may be limited or disrupted in certain parts of the continental U.S. and Canada during severe weather conditions. • Our operations require substantial capital and we may be unable to obtain needed capital or financing on satisfactory terms or at all, which could limit our ability to grow or conduct our business. • We may have difficulties in identifying and financing suitable, accretive acquisition opportunities and integrating businesses, assets and personnel. • Our liquidity needs could restrict our operations and make us more vulnerable to adverse economic conditions. • Our revolving credit facility and term credit facility provide for fluctuating interest rates, which may increase or decrease our interest expense. • Our operations are subject to hazards inherent in the oil and natural gas and energy infrastructure industries, which could expose us to substantial liability and cause us to lose customers and substantial revenue. • We are subject to extensive environmental, health and safety laws, trucking and other regulations that may subject us to increased costs and/or substantial liability. • Our operations in our natural sand proppant services business are dependent on our rights and ability to mine our properties and on our having renewed or received the required permits and approvals from governmental authorities and other third parties. • Changes in tax laws and regulations or adverse outcomes resulting from examination of our tax returns may adversely affect our business, results of operations, financial condition and cash flow. • Cyber incidents or intrusions may result in information theft or other loss, data corruption, operational disruption and/or financial loss.
Biggest changeIn the event that PREPA does not pay the remaining amount owed to us under the Settlement Agreement, our financial condition, results of operations and cash flows may be materially and adversely affected. • Our revolving credit facility impose restrictions on us that may affect our ability to successfully operate our business. • A portion of our business depends on the oil and natural gas industry and particularly on the level of exploration and production activity within the United States and Canada, and continued volatility in the oil and natural gas markets have impacted, and are likely to continue to impact, our oilfield services and, as a result, our business, financial condition, results of operations, cash flows and stock price. • The cyclicality of the oil and natural gas industry may cause our operating results to fluctuate. • If oil prices or natural gas prices decline, the demand for our oil and natural gas services could be adversely affected. • Advancements in oilfield service technologies could have a material adverse effect on our business, financial condition, results of operations and cash flows. • Our failure to receive payment for contract change orders or adequately recover on claims brought by us against customers related to payment terms and costs could materially and adversely affect our financial position, results of operations and cash flows. • We may not accurately estimate the costs associated with infrastructure services provided under fixed price contracts, which could have an adverse effect on our financial condition, results of operations and cash flows. • We may be unable to obtain sufficient bonding capacity to support certain service offerings, and the need for performance and surety bonds could reduce availability under our revolving credit facility. • An increase in the prices of certain materials used in our businesses could adversely affect our business, financial condition, results of operation and cash flows. • Increasing transportation and related costs could have a material adverse effect on our business. • Diminished access to water and inability to secure or maintain necessary permits may adversely affect operations of our frac sand processing plants. • In the course of our business, we may become subject to lawsuits, indemnity or other claims, which could materially and adversely affect our business, results of operations and cash flows. • We rely on a few key employees whose absence or loss could adversely affect our business. • Our operations may be limited or disrupted in certain parts of the continental U.S. and Canada during severe weather conditions, which could have a material adverse effect on our financial condition and results of operations. • Concerns over general economic, business or industry conditions may have a material adverse effect on our results of operations, liquidity and financial condition. • Our operations require substantial capital and we may be unable to obtain needed capital or financing on satisfactory terms or at all, which could limit our ability to grow or conduct our business. • The growth of our business through acquisitions may expose us to various risks, including those relating to difficulties in identifying suitable, accretive acquisition opportunities and integrating businesses, assets and personnel, as well as difficulties in obtaining financing for targeted acquisitions and the potential for increased leverage or debt service requirements. • We may have difficulty managing growth in our business, which could adversely affect our financial condition and results of operations. • If our intended expansion of our business is not successful, our financial condition, profitability and results of operations could be adversely affected, and we may not achieve increases in revenue and profitability that we hope to realize. 19 • Our operations are subject to hazards inherent in the oil and natural gas and energy infrastructure industries, which could expose us to substantial liability and cause us to lose customers and substantial revenue. • We are subject to extensive environmental, health and safety laws and regulations that may subject us to substantial liability or require us to take actions that will adversely affect our results of operations. • Our operations in our natural sand proppant services business are dependent on our rights and ability to mine our properties and on our having renewed or received the required permits and approvals from governmental authorities and other third parties. • Changes in tax laws and regulations or adverse outcomes resulting from examination of our tax returns may adversely affect our business, results of operations, financial condition and cash flow. • We are subject to cyber security risks.
We currently operate infrastructure facilities and service centers to support our infrastructure operations in the northeastern, southwestern, midwestern and western portions of the United States. We believe our geographic positioning within active oil and natural gas liquids resource plays will benefit us strategically as activity increases in these unconventional resource plays. • Experienced management and operating team.
We believe our geographic positioning within active oil and natural gas liquids resource plays will benefit us strategically as activity increases in these unconventional resource plays. We currently operate infrastructure facilities and service centers to support our infrastructure operations in the northeastern, southwestern, midwestern and western portions of the United States. • Experienced management and operating team.
In addition, on June 28, 2016, the EPA published a final rule prohibiting the discharge of wastewater from onshore unconventional oil and gas extraction facilities to publicly owned wastewater treatment plants, which regulations are discussed in more detail below under the caption “— 13 Regulation of Hydraulic Fracturing.” Costs may be associated with the treatment of wastewater or developing and implementing storm water pollution prevention plans, as well as for monitoring and sampling the storm water runoff from certain of our facilities.
In addition, on June 28, 2016, the EPA published a final rule prohibiting the discharge of wastewater from onshore unconventional oil and gas extraction facilities to publicly owned wastewater treatment plants, which regulations are discussed in more detail below under the caption “—Regulation of Hydraulic Fracturing.” Costs may be associated with the treatment of wastewater or developing and implementing storm water pollution prevention plans, as well as for monitoring and sampling the storm water runoff from certain of our facilities.
Depth 4 and complexity of the well and drill site conditions are the principal factors in determining the specifications of the rig selected for a particular job. Power requirements for drilling jobs may vary considerably, but most of our mechanical drilling rigs employ six engines to generate between 800 and 1,200 horsepower, depending on well depth and rig design.
Depth and complexity of the well and drill site conditions are the principal factors in determining the specifications of the rig selected for a particular job. Power requirements for drilling jobs may vary considerably, but most of our mechanical drilling rigs employ six engines to generate between 800 and 1,200 horsepower, depending on well depth and rig design.
These regulatory authorities exercise broad powers, governing activities such as the authorization to engage in motor carrier 11 operations, driver licensing and insurance requirements, financial reporting and review of certain mergers, consolidations and acquisitions, and transportation of hazardous materials (HAZMAT). Our trucking operations are subject to possible regulatory and legislative changes that may increase our costs.
These regulatory authorities exercise broad powers, governing activities such as the authorization to engage in motor carrier operations, driver licensing and insurance requirements, financial reporting and review of certain mergers, consolidations and acquisitions, and transportation of hazardous materials (HAZMAT). Our trucking operations are subject to possible regulatory and legislative changes that may increase our costs.
Additionally, on December 2, 2023, the EPA announced a final rule that would expand and strengthen emission reduction requirements for both new and existing sources in the oil and natural gas industry by requiring increased monitoring 15 of fugitive emissions, imposing new requirements for pneumatic controllers and tank batteries and prohibiting venting of natural gas in certain situations.
Additionally, on December 2, 2023, the EPA announced a final rule that would expand and strengthen emission reduction requirements for both new and existing sources in the oil and natural gas industry by requiring increased monitoring of fugitive emissions, imposing new requirements for pneumatic controllers and tank batteries and prohibiting venting of natural gas in certain situations.
An unfavorable ruling in any such case could significantly impact our operations and could have an adverse impact on our financial condition. 14 Moreover, climate change may cause more extreme weather conditions such as more intense hurricanes, thunderstorms, tornadoes and snow or ice storms, as well as rising sea levels and increased volatility in seasonal temperatures.
An unfavorable ruling in any such case could significantly impact our operations and could have an adverse impact on our financial condition. Moreover, climate change may cause more extreme weather conditions such as more intense hurricanes, thunderstorms, tornadoes and snow or ice storms, as well as rising sea levels and increased volatility in seasonal temperatures.
However, in April 2019, the EPA concluded that revisions to the federal regulations for the management of oil and gas waste are not necessary at this time. Any such changes in the laws and regulations could have a material adverse effect on our capital expenditures and operating expenses.
However, in April 2019, the EPA concluded that revisions to the federal regulations for the management of oil and gas waste are not necessary at this time. Any 12 such changes in the laws and regulations could have a material adverse effect on our capital expenditures and operating expenses.
Our SWA policy empowers our employees to stop work whenever they identify unsafe work conditions. When SWA is employed, operations cease until the risk is addressed and both 18 the employee and management agree that it is safe to resume work. See also “Safety and Remediation Program” below for additional information.
Our SWA policy empowers our employees to stop work whenever they identify unsafe work conditions. When SWA is employed, operations cease until the risk is addressed and both the employee and management agree that it is safe to resume work. See also “Safety and Remediation Program” below for additional information.
We offer a broad range of services on electric transmission and distribution, or T&D, networks and substation facilities, which include engineering, design, construction, upgrade, maintenance and repair of high voltage transmission lines, substations and lower voltage overhead and underground distribution systems. Our commercial services include the installation, maintenance and repair of commercial wiring.
We offer a broad range of services on electric transmission and distribution, or T&D, networks and substation facilities, which include engineering, design, construction, upgrade, maintenance and repair of 2 high voltage transmission lines, substations and lower voltage overhead and underground distribution systems. Our commercial services include the installation, maintenance and repair of commercial wiring.
“ Risk Factors ” for a description of certain risks associated with our insurance policies. 10 Safety and Remediation Program In the energy services industry, an important competitive factor in establishing and maintaining long-term customer relationships is having an experienced and skilled workforce.
“ Risk Factors ” for a description of certain risks associated with our insurance policies. Safety and Remediation Program In the energy services industry, an important competitive factor in establishing and maintaining long-term customer relationships is having an experienced and skilled workforce.
The rule requires public disclosure of chemicals used in hydraulic fracturing, implementation of a casing and cementing program, management of recovered fluids, and submission to the BLM of detailed information about the proposed operation, including wellbore geology, the location of faults and fractures, and the depths of all usable water.
The rule requires public disclosure of chemicals used in hydraulic fracturing, 15 implementation of a casing and cementing program, management of recovered fluids, and submission to the BLM of detailed information about the proposed operation, including wellbore geology, the location of faults and fractures, and the depths of all usable water.
Noncompliance with these requirements may result in substantial administrative, civil and criminal penalties, as well as injunctive obligations. Air Emissions . The federal Clean Air Act, as amended, and comparable state laws and regulations, regulate emissions of various air pollutants through the issuance of permits and the imposition of other requirements.
Noncompliance with these requirements may result in substantial administrative, civil and criminal penalties, as well as injunctive obligations. 13 Air Emissions . The federal Clean Air Act, as amended, and comparable state laws and regulations, regulate emissions of various air pollutants through the issuance of permits and the imposition of other requirements.
Further, as part of our safety program and remediation procedures, we check treating iron for any defects on a periodic basis to avoid iron failure during hydraulic fracturing operations, marking such treating iron to reflect the most recent testing date.
Further, as part of our safety program and remediation procedures, we check treating iron for any defects on a periodic basis to avoid iron failure during hydraulic fracturing operations, marking such treating iron to reflect the 10 most recent testing date.
As of December 31, 2023, we had a fleet of 13 crude oil hauling trucks. 6 Our Industries Oil and Natural Gas Industry The oil and natural gas industry has traditionally been volatile and is influenced by a combination of long-term, short-term and cyclical trends, including the domestic and international supply and demand for oil and natural gas, current and expected future prices for oil and natural gas and the perceived stability and sustainability of those prices, production depletion rates and the resultant levels of cash flows generated and allocated by exploration and production companies to their drilling, completion and related services and products budgets.
As of December 31, 2024, we had a fleet of 13 crude oil hauling trucks. 6 Our Industries Oil and Natural Gas Industry The oil and natural gas industry has traditionally been volatile and is influenced by a combination of long-term, short-term and cyclical trends, including the domestic and international supply and demand for oil and natural gas, current and expected future prices for oil and natural gas and the perceived stability and sustainability of those prices, production depletion rates and the resultant levels of cash flows generated and allocated by exploration and production companies to their drilling, completion and related services and products budgets.
Such legislative or regulatory changes could cause us or our customers to incur substantial compliance costs, and compliance or the consequences of any failure to comply by us could have a material adverse 16 effect on our financial condition and results of operations.
Such legislative or regulatory changes could cause us or our customers to incur substantial compliance costs, and compliance or the consequences of any failure to comply by us could have a material adverse effect on our financial condition and results of operations.
We provide our well completion, natural sand proppant, drilling and other services to a diversified range of both public and private independent oil and natural gas producers and our infrastructure services to private utilities, public investor owned utilities, or IOUs, and cooperatives, or Co-Ops.
We provide our well completion, natural sand proppant and other services to a diversified range of both public and private independent oil and natural gas producers and our infrastructure services to private utilities, public investor owned utilities, or IOUs, and cooperatives, or Co-Ops.
Interstate motor carrier operations are subject to safety requirements prescribed by the Federal Motor Carrier Safety Administration, or FMCSA, a unit within the United States Department of Transportation. To a large degree, intrastate motor carrier operations are subject to state safety regulations that mirror federal regulations.
Interstate motor carrier operations are subject to safety requirements prescribed by the Federal Motor Carrier Safety Administration, or FMCSA, a unit within the United States Department of Transportation. To a large degree, intrastate motor 11 carrier operations are subject to state safety regulations that mirror federal regulations.
We continue to maintain our equipment and monitor market conditions to determine if and when we will recommence these services. 5 Flowback . Our flowback services consisted of production testing, solids control, hydrostatic testing and torque services.
We continue to maintain our equipment and monitor market conditions to determine if and when we will recommence these services. Flowback . Our flowback services consisted of production testing, solids control, hydrostatic testing and torque services.
See also “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview of Our Industries—Oil and Natural Gas Industry” for additional information. Sand Hauling . Our sand hauling services provide last-mile trucking and logistics services for proppant used in completion activities in the Utica Shale and SCOOP/STACK. As of December 31, 2023, we owned a fleet of 39 trucks.
See also “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview of Our Industries—Oil and Natural Gas Industry” for additional information. Sand Hauling . Our sand hauling services provide last-mile trucking and logistics services for proppant used in completion activities in the Utica Shale and SCOOP/STACK. As of December 31, 2024, we owned a fleet of 39 trucks.
Ceasing or suppressing production during the completion phase of an unconventional well could result in formation damage impacting the overall recovery of reserves. Our pressure control services helped operators minimize the risk of such damage during completion activities. As of December 31, 2023, we had a total of four nitrogen pumping units and five fluid pumping units.
Ceasing or suppressing production during the completion phase of an unconventional well could result in formation damage impacting the overall recovery of reserves. Our pressure control services helped operators minimize the risk of such damage during completion activities. As of December 31, 2024, we had a total of four nitrogen pumping units and five fluid pumping units.
As of December 31, 2023, we had a total of four nitrogen pumping units capable of pumping at a rate of up to 3,000 standard cubic feet per minute with pressures up to 10,000 psi. Pumping at these rates and pressures is typically required for the unconventional oil and natural gas resource plays we serve. • Fluid Pumping Services.
As of December 31, 2024, we had a total of four nitrogen pumping units capable of pumping at a rate of up to 3,000 standard cubic feet per minute with pressures up to 10,000 psi. Pumping at these rates and pressures is typically required for the unconventional oil and natural gas resource plays we serve. • Fluid Pumping Services.
The Department of Transportation periodically conducts compliance reviews and may revoke registration privileges based on certain safety performance criteria which could result in a suspension of operations. The rating scale consists of “satisfactory,” “conditional” and “unsatisfactory” ratings. As of December 31, 2023, all of our trucking operations have “satisfactory” ratings with the Department of Transportation.
The Department of Transportation periodically conducts compliance reviews and may revoke registration privileges based on certain safety performance criteria which could result in a suspension of operations. The rating scale consists of “satisfactory,” “conditional” and “unsatisfactory” ratings. As of December 31, 2024, all of our trucking operations have “satisfactory” ratings with the Department of Transportation.
As part of our contract drilling services, we provided both vertical and horizontal drilling services to customers in the Permian Basin of West Texas. As of December 31, 2023, we owned 11 land drilling rigs, ranging from 800 to 1,600 horsepower, seven of which are specifically designed for drilling horizontal and directional wells.
As part of our contract drilling services, we provided both vertical and horizontal drilling services to customers in the Permian Basin of West Texas. As of December 31, 2024, we owned 11 land drilling rigs, ranging from 800 to 1,600 horsepower, seven of which are specifically designed for drilling horizontal and directional wells.
During 2019, we expanded our trucking operations to include brokering and hauling of general freight throughout the United States. As of December 31, 2023, we had a fleet of six trucks. Crude Oil Hauling . We provided crude transportation services in the Permian Basin and mid-continent region.
During 2019, we expanded our trucking operations to include brokering and hauling of general freight throughout the United States. As of December 31, 2024, we had a fleet of six trucks. Crude Oil Hauling . We provided crude transportation services in the Permian Basin and mid-continent region.
We provided flowback services in the Appalachian Basin, the Eagle Ford Shale, the Haynesville Shale and mid-continent markets. As of December 31, 2023, we owned 20 solids control packages, four hydrostatic testing packages and seven torque service packages. Cementing and Acidizing . We provided cementing and acidizing services in the Permian Basin.
We provided flowback services in the Appalachian Basin, the Eagle Ford Shale, the Haynesville Shale and mid-continent markets. As of December 31, 2024, we owned 20 solids control packages, four hydrostatic testing packages and seven torque service packages. Cementing and Acidizing . We provided cementing and acidizing services in the Permian Basin.
Fluid pumping services consist of maintaining well pressure, pumping down wireline tools, assisting coiled tubing units and the removal of fluids and solids from the wellbore for clean-out operations. As of December 31, 2023, we had five fluid pumping units.
Fluid pumping services consist of maintaining well pressure, pumping down wireline tools, assisting coiled tubing units and the removal of fluids and solids from the wellbore for clean-out operations. As of December 31, 2024, we had five fluid pumping units.
As of December 31, 2023, we owned two coiled tubing units capable of running 23,500 feet of two and three eighths inch coil rated at 15,000 psi, one coiled tubing unit capable of running 24,500 feet of two inch coil rated at 15,000 psi, two coiled tubing units capable of running 22,500 feet of two inch coil rated at 10,000 psi and one coiled tubing unit capable of running 20,500 feet of two and three eighths inch coil rated at 15,000 psi.
As of December 31, 2024, we owned two coiled tubing units capable of running 23,500 feet of two and three eighths inch coil rated at 15,000 psi, one coiled tubing unit capable of running 24,500 feet of two inch coil rated at 15,000 psi, two coiled tubing units capable of running 22,500 feet of two inch coil rated at 10,000 psi and one coiled tubing unit capable of running 20,500 feet of two and three eighths inch coil rated at 15,000 psi.
Since we commenced operations in this line of business, a substantial portion of our infrastructure revenue has been generated from storm restoration work, primarily from the Puerto Rico Electric Power Authority, or PREPA, due to damage caused by Hurricane Maria.
Settlement Agreement with PREPA Since we commenced operations in this line of business, a substantial portion of our infrastructure revenue has been generated from storm restoration work, primarily from the Puerto Rico Electric Power Authority, or PREPA, due to damage caused by Hurricane Maria.
Our primary business objective is to grow our operations and create value for stockholders through organic growth opportunities and accretive acquisitions. Our suite of services includes well completion services, infrastructure services, natural sand proppant services, drilling services and other services. Our well completion services division provides hydraulic fracturing, sand hauling and water transfer services.
Our primary business objective is to grow our operations and create value for stockholders through organic growth opportunities and accretive acquisitions. Our suite of services includes well completion services, infrastructure services, natural sand proppant services and other services. Our well completion services division provides hydraulic fracturing and sand hauling services.
Our Services Our revenues, operating income (loss) and identifiable assets are primarily attributable to four reportable segments: well completion services, infrastructure services, natural sand proppant services and drilling services. 1 Well Completion Services Pressure Pumping . We provide pressure pumping services, also known as hydraulic fracturing, to exploration and production companies.
Our Services Our revenues, operating income (loss) and identifiable assets are primarily attributable to three reportable segments: well completion services, infrastructure services and natural sand proppant services. 1 Well Completion Services Pressure Pumping . We provide pressure pumping services, also known as hydraulic fracturing, to exploration and production companies.
As of December 31, 2023, we owned four MWD kits and one EM kit used in vertical, horizontal and directional drilling applications, 89 mud motors, nine air motors and an inventory of related parts and equipment. Currently, we perform our directional drilling services in the Utica Shale, Anadarko Basin, Arkoma Basin, Powder River Basin and Permian Basin. Contract Drilling .
As of December 31, 2024, we owned four MWD kits and one EM kit used in vertical, horizontal and directional drilling applications, 89 mud motors, nine air motors and an inventory of related parts and equipment. Currently, we perform our directional drilling services in the Utica Shale, Anadarko Basin, Arkoma Basin, Powder River Basin and Permian Basin. Aviation Services.
We also promote diversity, inclusion and equal employment opportunities by evaluating and promoting employees based on skills and performance alone, while also seeking to attract and retain a diverse workforce and continuing to cultivate an inclusive and respectful work environment. One of six of our current board members and director nominees is ethnically diverse.
We also promote diversity, inclusion and equal employment opportunities by evaluating and promoting employees based on skills and performance alone, while also seeking to attract and retain a diverse workforce and continuing to cultivate an inclusive and respectful work environment. One of five of our current board members is ethnically diverse.
Our operational division heads have an extensive track record in the oilfield and infrastructure service businesses with an average of over 31 years of oilfield services experience and over 26 years of infrastructure services experience. In addition, our field managers have expertise in the areas in which they operate and understand the challenges that our customers face.
Our operational division heads have an extensive track record in the oilfield and infrastructure service businesses with an average of over 32 years of oilfield services experience and over 27 years of infrastructure services experience. In addition, our field managers have expertise in the areas in which they operate and understand the challenges that our customers face.
Employees, Safety and Diversity As of December 31, 2023, we had 733 full time employees. The number of employees fluctuates depending on the current and expected demand for our services. None of our employees are represented by labor unions or covered by any collective bargaining agreements.
Employees, Safety and Diversity As of December 31, 2024, we had 639 full time employees. The number of employees fluctuates depending on the current and expected demand for our services. None of our employees are represented by labor unions or covered by any collective bargaining agreements.
Our operational division heads have an extensive track record in the oilfield service and infrastructure businesses with an average of over 31 years of oilfield services experience and over 26 years of infrastructure services experience. They bring valuable expertise and long-term customer relationships to our business.
Our operational division heads have an extensive track record in the oilfield service and infrastructure businesses with an average of over 32 years of oilfield services experience and over 27 years of infrastructure services experience. They bring valuable expertise and long-term customer relationships to our business.
We work for multiple utilities primarily across the northeastern, southwestern, midwestern and western portions of the United States. We believe that we are well-positioned to compete for new projects due to the experience of our infrastructure management team, combined with our vertically integrated service offerings.
We work for multiple private utilities, public IOUs and Co-Ops primarily across the northeastern, southwestern, midwestern and western portions of the United States. We believe that we are well-positioned to compete for new projects due to the experience of our infrastructure management team, combined with our vertically integrated service offerings.
Our top five customers accounted for approximately 35%, 36% and 35%, respectively, of our revenue for the years ended December 31, 2023, 2022 and 2021.
Our top five customers accounted for approximately 34%, 35% and 36%, respectively, of our revenue for the years ended December 31, 2024, 2023 and 2022.
To complement our organic growth and subject to our liquidity needs, we intend to pursue selected, accretive acquisitions of businesses and assets, primarily related to our infrastructure 9 services, completion and production services and industrial based companies, that can meet our targeted returns on invested capital and enhance our portfolio of products and services, market positioning and/or geographic presence.
To complement our organic growth, we intend to pursue selected, accretive acquisitions of businesses and assets, primarily related to our infrastructure services and industrial based companies that can meet our targeted returns on invested capital and enhance our portfolio of products and services, market positioning and/or geographic presence.
As of December 31, 2023, our pressure pumping business included six high-pressure fleets consisting of an aggregate 128 high-pressure fracturing units with pump nameplate capacity of 310,000 horsepower. One of our six pressure pumping fleets was staffed and providing services in the northeast region as of December 31, 2023.
As of December 31, 2024, our pressure pumping business included six high-pressure fleets consisting of an aggregate 128 high-pressure fracturing units with pump nameplate capacity of 310,000 horsepower. Two of our six pressure pumping fleets were staffed and providing services in the northeast region as of December 31, 2024.
However, to the extent the EPA and the Corps broadly interpret their jurisdiction and expand the range of properties subject to the Clean Water Act’s jurisdiction, certain energy companies could face increased costs and delays with respect to obtaining permits for dredge and fill activities in wetland areas.
However, to the extent the EPA and the Corps broadly interpret their jurisdiction and expand the range of properties subject to the Clean Water Act’s jurisdiction, certain energy companies could face increased costs and delays with respect to obtaining permits for dredge and fill activities in wetland areas. The appointment of a new EPA administrator may mitigate enforcement.
In response to market conditions, we temporarily shut down our cementing and acidizing operations and flowback operations beginning in July 2019, our contract drilling operations beginning in December 2019, our rig hauling operations beginning in April 2020, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
In response to market conditions and reduced demand, we idled our cementing and acidizing operations and flowback operations beginning in July 2019, our contract drilling operations beginning in December 2019, our rig hauling operations beginning in April 2020, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
As of December 31, 2023, we had a capacity of 878 rooms, 612 of which are at Sand Tiger Lodge, our camp in northern Alberta, Canada, and 266 of which are available to be leased as rental equipment to a third party. On average, 178 rooms were utilized per night during the year ended December 31, 2023. Equipment Manufacturing.
As of December 31, 2024, we had a capacity of 764 rooms, 612 of which are at Sand Tiger Lodge, our camp in northern Alberta, Canada, and 152 of which are available to be leased as rental equipment to a third party. On average, 216 rooms were utilized per night during the year ended December 31, 2024. Equipment Manufacturing.
Cementing services involve preparing and pumping cement into place in a wellbore to support and protect well casings and help achieve zonal isolation. Acidizing services involve pumping acid into a wellbore to improve productivity or injectivity. As of December 31, 2023, we owned four acidizing pumps. Coil Tubing .
Cementing services involve preparing and pumping cement into place in a wellbore to support and protect well casings and help achieve zonal isolation. Acidizing services involve pumping acid into a wellbore to improve productivity or injectivity. As of December 31, 2024, we owned four acidizing pumps. 5 Contract Drilling .
Our major competitors in well completion services include Halliburton Company, Universal Pressure Pumping, Inc., NexTier Oilfield Solutions, Inc., RPC Incorporated, Liberty Oilfield Services, Inc. and ProFrac Holding Corp. Our major competitors for our infrastructure services business include MYR Group, Inc., Quanta Services, Inc., MasTec, Inc. and EMCOR Group, Inc.
Our major competitors in well completion services include Halliburton Company, Evolution Well Services, NexTier Oilfield Solutions, Inc., Liberty Oilfield Services, Inc. and ProFrac Holding Corp. Our major competitors for our infrastructure services business include MYR Group, Inc., Quanta Services, Inc., MasTec, Inc. and EMCOR Group, Inc.
We believe this approach will help facilitate the strategic expansion of our customer base, geographic presence and service offerings. We also believe that our industry contacts and those of Wexford Capital LP (“Wexford”), our largest stockholder, may help us identify acquisition opportunities. We may use our common stock as consideration for accretive acquisitions.
We believe this approach will help facilitate the strategic expansion of our customer base, geographic presence and service offerings. We also believe that our industry contacts and those of Wexford Capital LP (“Wexford”), our largest stockholder, may help us identify acquisition opportunities.
On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act into law. This is expected to bring new opportunities in the infrastructure industry, including new fiber-related projects.
On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act into law. This has brought new opportunities in the infrastructure industry, including new fiber-related projects.
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services. These factors have continued into the first quarter of 2024.
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services.
Demand for our natural sand proppant was adversely impacted in the second quarter of 2023 by the wildfires in Canada, which hindered our ability to transport sand. Notwithstanding the foregoing, our sand business remained resilient during the second quarter of 2023.
Demand for our natural sand proppant was adversely impacted in the second quarter of 2023 by the wildfires in Canada, which hindered our ability to transport sand.
It is wound or coiled on a truck-mounted reel for onshore applications. Due to its small diameter in certain iterations, coiled tubing can be inserted into existing production tubing and used to perform a variety of services to enhance the flow of oil or natural gas without using a larger, more costly workover rig.
Due to its small diameter in certain iterations, coiled tubing can be inserted into existing production tubing and used to perform a variety of services to enhance the flow of oil or natural gas without using a larger, more costly workover rig.
Similar protections are offered to migratory birds under the Migratory Bird Treaty Act. Federal agencies are required to insure that any action authorized, funded or carried out by them is not likely to jeopardize the continued existence of listed species or modify their critical habitat.
Federal agencies are required to insure that any action authorized, funded or carried out by them is not likely to jeopardize the continued existence of listed species or modify their critical habitat.
Further, as of December 31, 2023, over 11% of our employees were women and 22 of 97 employees holding managerial and other key positions within the organization are women. Also, over 11% of our employees self-identify as ethnic minorities as of December 31, 2023. Further, we invest in the learning and development of our employees.
Further, as of December 31, 2024, over 9% of our employees were women and 24 of 117 employees holding managerial and other key positions within the organization are women. Also, over 13% of our employees self-identify as ethnic minorities as of December 31, 2024. Further, we invest in the learning and development of our employees.
Our Business Strategy We intend to achieve our primary business objective by the successful execution of our business plan to strategically deploy our equipment and personnel to provide well completion services, natural sand proppant services and other energy services in unconventional resource plays, including the Utica Shale in Ohio, the SCOOP/STACK in Oklahoma and the Marcellus Shale in West Virginia.
We believe that our fleet of quality equipment will allow us to provide a high level of service to our customers. 8 Our Business Strategy We intend to achieve our primary business objective by the successful execution of our business plan to strategically deploy our equipment and personnel to provide well completion services, natural sand proppant services and other energy services in unconventional resource plays, including the Utica Shale in Ohio, the SCOOP/STACK in Oklahoma and the Marcellus Shale in West Virginia.
We are seeking to leverage this experience and our service offerings to grow our customer base and increase our revenues in the continental United States over the coming years. Natural Sand Proppant Services In our natural sand proppant business, we mine, process and sell sand.
We are seeking to leverage this experience and our service offerings to grow our customer base and increase our revenues in the continental United States over the coming years.
We do not believe that compliance with these laws will have a material adverse effect on us. 17 Regulation of Infrastructure Services In our infrastructure business, our operations are subject to various federal, state and local laws and regulations including: • licensing, permitting and inspection requirements applicable to contractors, electricians and engineers; • regulations governing environmental and conservation matters; • regulations relating to worker safety; • permitting and inspection requirements applicable to construction projects; • wage and hour regulations; • building and electrical codes; and • special bidding, procurement and other requirements on government projects.
Regulation of Infrastructure Services In our infrastructure business, our operations are subject to various federal, state and local laws and regulations including: • licensing, permitting and inspection requirements applicable to contractors, electricians and engineers; • regulations governing environmental and conservation matters; • regulations relating to worker safety; • permitting and inspection requirements applicable to construction projects; • wage and hour regulations; • building and electrical codes; and • special bidding, procurement and other requirements on government projects.
Our operational division heads have long-term relationships with our largest customers. We intend to leverage these relationships and our operational management team’s expertise to deliver innovative, client focused and services to our customers. • Expand through selected, accretive acquisitions.
We seek to manage the services we provide as closely as possible to the needs of our customer base. Our operational division heads have long-term relationships with our largest customers. We intend to leverage these relationships and our operational management team’s expertise to deliver innovative, client focused and services to our customers. • Expand through selected, accretive acquisitions.
In the past, we have also bought processed sand from suppliers on the spot market for resale. Natural sand proppant, also known as frac sand, is the most widely used type of proppant due to its broad applicability in unconventional oil and natural gas wells and its cost advantage relative to other proppants.
Natural sand proppant, also known as frac sand, is the most widely used type of proppant due to its broad applicability in unconventional oil and natural gas wells and its cost advantage relative to other proppants.
As discussed above, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities and adversely impacted demand for our sand proppant services in the second half of 2023. We are beginning to see an uptick in orders for our sand in the first quarter of 2024.
As discussed above, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities and adversely impacted demand for our sand proppant services in the second half of 2023. Activity remained suppressed throughout 2024.
Due to market conditions, we temporarily shut down our flowback, cementing and acidizing operations beginning in July 2019, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
Due to market conditions, we idled our flowback, cementing and acidizing operations beginning in July 2019, our contract land drilling operations beginning in December 2019, our rig moving services beginning in April 2020, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
Natural frac sand may be used as proppant in all but the highest pressure and temperature environments and is being employed in nearly all major U.S. unconventional oil and natural gas producing basins, including those in which we operate. 3 At our Barron County and Jackson County, Wisconsin plants, we mine and process sand into premium monocrystalline sand, a specialized mineral that is used as frac sand.
Natural frac sand may be used as proppant in all but the highest pressure and temperature environments and is being employed in nearly all major U.S. unconventional oil and natural gas producing basins, including those in which we operate.
We believe that the following strengths position us well to capitalize on activity in unconventional resource plays and achieve our primary business objective: • Strategic geographic positioning.
Our Strengths Our primary business objective is to grow our operations and create value for our stockholders through organic growth opportunities and accretive acquisitions. We believe that the following strengths position us well to capitalize on activity in unconventional resource plays and achieve our primary business objective: • Strategic geographic positioning.
Our oilfield service fleet is predominantly comprised of equipment designed to optimize recovery from unconventional wells and our infrastructure service fleet is predominantly comprised of equipment designed to construct and repair electric transmission and distribution lines. We believe that our fleet of quality equipment will allow us to provide a high level of service to our customers.
Our oilfield service fleet is predominantly comprised of equipment designed to optimize recovery from unconventional wells and our infrastructure service fleet is predominantly comprised of equipment designed to construct and repair electric transmission and distribution lines.
Other Regulation of the Oil and Natural Gas Industry The oil and natural gas industry is extensively regulated by numerous federal, state and local authorities. Legislation affecting the oil and natural gas industry is under constant review for amendment or expansion, frequently increasing the regulatory burden.
Legislation affecting the oil and natural gas industry is under constant review for amendment or expansion, frequently increasing the regulatory burden.
Moreover, the EPA or state or local governments may adopt more stringent requirements for the handling of non-hazardous wastes or categorize some non-hazardous wastes as hazardous for future regulation.
Administrative, civil and criminal penalties can be imposed for failure to comply with waste handling requirements. Moreover, the EPA or state or local governments may adopt more stringent requirements for the handling of non-hazardous wastes or categorize some non-hazardous wastes as hazardous for future regulation.
In addition, its crush resistant properties enable Northern White frac sand to be used in deeper drilling applications than the frac sand produced from many native mineral deposits. 7 We believe that the coarseness, conductivity, sphericity, acid-solubility, and crush-resistant properties of our Northern White sand reserves and our facilities’ connectivity to rail and other transportation infrastructure afford us a cost advantage over many of our competitors and make us one of a select group of sand producers capable of delivering high volumes of frac sand that is optimal for oil and natural gas production to all major unconventional resource basins currently producing throughout North America.
We believe that the coarseness, conductivity, sphericity, acid-solubility, and crush-resistant properties of our Northern White sand reserves and our facilities’ connectivity to rail and other transportation infrastructure afford us a cost advantage over many of our competitors and make us one of a select group of sand producers capable of delivering high volumes of frac sand that is optimal for oil and natural gas production to all major unconventional resource basins currently producing throughout North America. 7 Energy Infrastructure Industry The energy infrastructure industry involves the construction and maintenance of the electrical power grid, including power generation, high voltage transmission lines, substations and low voltage distribution lines, all of which connect power generation facilities to end users.
We also offered coil tubing services, pressure control services, flowback services, crude oil hauling services, cementing services and acidizing services during certain of the periods discussed in this report.
We also offered coil tubing services, pressure control services, flowback services, crude oil hauling services, cementing services and acidizing services.
Our failure to comply with applicable regulations could result in substantial fines or revocation of our operating licenses, as well as give rise to termination or cancellation rights under our contracts or disqualify us from future bidding opportunities.
Our failure to comply with applicable regulations could result in substantial fines or revocation of our operating licenses, as well as give rise to termination or cancellation rights under our contracts or disqualify us from future bidding opportunities. 17 OSHA Matters We are also subject to the requirements of the federal Occupational Safety and Health Act, or OSHA, and comparable state statutes that regulate the protection of the health and safety of workers.
Risks Inherent to Our Common Stock • Our largest stockholder controls a significant percentage of our common stock, and its interests may conflict with those of our other stockholders. • A significant reduction by our largest stockholder, Wexford of its ownership interests in us could adversely affect us. • Sales of shares of our common stock by our largest stockholders or sales of substantial amounts of our common stock by other stockholders could adversely affect the market price of our common stock. • The corporate opportunity provisions in our certificate of incorporation could enable Wexford or other affiliates of ours to benefit from corporate opportunities that might otherwise be available to us. • We have engaged and expect to continue to engage in transactions with our affiliates, the terms of which and the resolution of any conflicts thereunder may not always be in our or our stockholders’ best interests. • If our operating results do not meet expectations of securities and financial analysts, the price of our common stock could decline. • We may issue preferred stock adversely affecting the voting power or value of our common stock. • Provisions in our certificate of incorporation and bylaws and Delaware law make it more difficult to effect a change in control of the company, which could adversely affect the price of our common stock. • The exclusive forum provisions of our certificate of incorporation could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees. • The declaration of dividends on our common stock is within the discretion of our board of directors, and there is no guarantee that we will pay any dividends in the future or at levels anticipated by our stockholders. • Our ability to repurchase stock may be limited and no assurance can be given that we will be able to effectuate our stock repurchase program in the future at indicated levels or at all.
Sales of these shares of common stock or sales of substantial amounts of our common stock by other stockholders, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock. • If securities or industry analysts do not publish research or reports about our business, if they adversely revise their recommendations regarding our stock or if our operating results do not meet their expectations, the price of our stock could decline. • We may issue preferred stock whose terms could adversely affect the voting power or value of our common stock. • Provisions in our certificate of incorporation and bylaws and Delaware law make it more difficult to effect a change in control of the company, which could adversely affect the price of our common stock. • Our certificate of incorporation designates courts in the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees. • The declaration of dividends on our common stock is within the discretion of our board of directors based upon a review of relevant considerations, and there is no guarantee that we will pay any dividends in the future or at levels anticipated by our stockholders. • Our ability to repurchase stock may be limited and no assurance can be given that we will be able to effectuate our stock repurchase program in the future at indicated levels or at all. 20
Demand for our services is driven by the repair and construction of transmission lines, fiber lines, substations and distribution networks and is determined by the level of expenditures of utility companies. While expansion of the electrical grid is occurring, the majority of capital expenditures spent in recent years has surrounded the repair and maintenance of existing networks.
While expansion of the electrical grid is occurring, the majority of capital expenditures spent in recent years has surrounded the repair and maintenance of existing networks.
PREPA is currently subject to bankruptcy proceedings pending in the U.S. District Court for the District of Puerto Rico. As a result, PREPA’s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
Due to PREPA’s bankruptcy proceedings, PREPA’s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
We believe that the age of the existing infrastructure across the United States and the spending trends in North America will benefit our operations and our ability to achieve our business objectives.
We believe that the age of the existing infrastructure across the United States and the spending trends in North America will benefit our operations and our ability to achieve our business objectives. Funding for projects in the infrastructure space remains strong with added opportunities since the Infrastructure Investment and Jobs Act was signed into law on November 15, 2021.
During 2023, oil prices fluctuated between a low of $66.74 on March 17, 2023, and a high of $93.68 on September 27, 2023, and averaged $77.61 per barrel for the year. We saw a decline in commodity pricing during 2023, resulting in lower utilization and margins for our oilfield services divisions. • Maintain a conservative balance sheet.
During 2024, natural gas prices fluctuated between a low of $1.58 on February 15, 2024, and a high of $3.95 on December 24, 2024, and averaged $2.41 per MMBtu for the year. We saw a decline in commodity pricing during 2024, resulting in lower utilization and margins for our oilfield services divisions. • Maintain a conservative balance sheet.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, operations and financial results. Please refer to Item 1A “Risk Factors” of this Form 10-K below for additional discussion of the risks summarized in this Risk Factors Summary.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, operations and financial results.
In addition to these service divisions, we also provide aviation services, equipment rentals, remote accommodations and equipment manufacturing. We believe that the services we offer play a critical role in increasing the ultimate recovery and present value of production streams from unconventional resources as well as in maintaining and improving electrical infrastructure.
We believe that the services we offer play a critical role in increasing the ultimate recovery and present value of production streams from unconventional resources as well as in maintaining and improving electrical infrastructure. Our complementary suite of services provides us with the opportunity to cross-sell our services and expand our customer base and geographic positioning.
Our infrastructure services division provides engineering, design, construction, upgrade, maintenance and repair services to the electrical infrastructure industry. Our natural sand proppant services division mines, processes and sells natural sand proppant used for hydraulic fracturing. Our drilling services division currently provides rental equipment, such as mud motors and operational tools, for both vertical and horizontal drilling.
Our infrastructure services division provides engineering, design, construction, upgrade, maintenance and repair services to the electrical infrastructure industry. Our natural sand proppant services division mines, processes and sells natural sand proppant used for hydraulic fracturing. In addition to these service divisions, we also provide directional drilling services, aviation services, equipment rentals, remote accommodations and equipment manufacturing.
Although certain petroleum production wastes are exempt from regulation as hazardous wastes under RCRA, such wastes may constitute “solid wastes” that are subject to the less stringent requirements of non-hazardous waste provisions. 12 Administrative, civil and criminal penalties can be imposed for failure to comply with waste handling requirements.
With federal approval, the individual states administer some or all of the provisions of RCRA, sometimes in conjunction with their own, more stringent requirements. Although certain petroleum production wastes are exempt from regulation as hazardous wastes under RCRA, such wastes may constitute “solid wastes” that are subject to the less stringent requirements of non-hazardous waste provisions.
MSHA representatives perform at least two annual inspections of our production facilities to ensure employee and general site safety. To date, these inspections have not resulted in any citations for material violations of MSHA standards, and we believe we are in material compliance with MSHA requirements.
MSHA representatives perform at least two annual inspections of our production facilities to ensure employee and general site safety.
Most drilling rigs capable of drilling in deep formations drill to measured depths greater than 10,000 to 18,000 feet. Generally, land rigs operate with four crews of five people and two tool pushers, or rig managers, rotating on a weekly or bi-weekly schedule. We believe that our drilling rigs and other related equipment are in good operating condition.
Most drilling rigs capable of drilling in deep formations drill to measured depths greater than 10,000 to 18,000 feet. We believe that our drilling rigs and other related equipment are in good operating condition. Our employees perform periodic maintenance and minor repair work on our drilling rigs. Rig Moving . We provided rig moving services in the Permian Basin.
Our complementary suite of services provides us with the opportunity to cross-sell our services and expand our customer base and geographic positioning. The growth of our industrial businesses is ongoing. We offer infrastructure engineering services focused on the transmission and distribution industry and also have equipment manufacturing operations and offer fiber optic services.
We continue to focus on growing our industrial business. We offer infrastructure engineering services focused on the transmission and distribution industry and also have equipment manufacturing operations and offer fiber optic services.
We also provide storm repair and restoration services in response to storms and other disasters. We provide infrastructure services primarily in the northeast, southwest, midwest and western portions of the United States. We currently have agreements in place with private utilities, public IOUs and Co-Ops.
We also provide storm repair and restoration services in response to storms and other disasters. We provide infrastructure services primarily in the northeast, southwest, midwest and western portions of the United States. Our average crew count declined slightly from approximately 83 crews throughout 2023 to approximately 79 crews throughout 2024.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeNew technologies, services or standards could render some of our services, equipment and other assets obsolete, which could have a material adverse impact on our business, cash flows, results of operations and financial condition.
Biggest changeAny such penalties, fines or sanctions could have a material adverse effect on our proppant production and sales business and our overall financial condition, results of operations and cash flows. 37 Increasing trucking regulations may increase our costs and negatively impact our results of operations.
If we are unable to continue comply with Section 404 or if the costs related to compliance are significant, our profitability, stock price, results of operations and financial condition could be materially adversely affected.
If we are unable to continue to comply with Section 404 or if the costs related to compliance are significant, our profitability, stock price, results of operations and financial condition could be materially adversely affected.
Further, construction and upgrade projects are subject to risks of delay or significant cost overruns inherent in any large construction project from numerous factors, including the following: • shortages of equipment, materials or skilled labor; • unscheduled delays in the delivery of ordered materials and equipment or shipyard construction; • failure of equipment to meet quality and/or performance standards; • financial or operating difficulties of equipment vendors; • unanticipated actual or purported change orders; • inability by us or our customers to obtain required permits or approvals, or to meet applicable regulatory standards in our areas of operations; • unanticipated cost increases between order and delivery; • adverse weather conditions and other events of force majeure; • design or engineering changes; and • work stoppages and other labor disputes.
Further, construction and upgrade projects are subject to risks of delay or significant cost overruns inherent in any large construction project from numerous factors, including the following: • shortages of equipment, materials or skilled labor; • unscheduled delays in the delivery of ordered materials and equipment or shipyard construction; • failure of equipment to meet quality and/or performance standards; • financial or operating difficulties of equipment vendors; 25 • unanticipated actual or purported change orders; • inability by us or our customers to obtain required permits or approvals, or to meet applicable regulatory standards in our areas of operations; • unanticipated cost increases between order and delivery; • adverse weather conditions and other events of force majeure; • design or engineering changes; and • work stoppages and other labor disputes.
In addition, our certificate of incorporation provides that if any action specified above (each is referred to herein as a covered proceeding), is filed in a court other than the specified Delaware courts without the approval of our board of directors (each is referred to herein as a foreign action), the claiming party will be deemed to have consented to (i) the personal jurisdiction of the specified Delaware courts in connection with any action brought in any such courts to enforce the exclusive forum provision described above and (ii) having service of process made upon such claiming party in any such enforcement action by service upon such claiming party’s counsel in the foreign action as agent for such claiming party.
In addition, our certificate of incorporation provides that if any action specified above (each is referred to herein as a covered proceeding), is filed in a court other than the specified Delaware courts without the approval of our board of directors (each is referred to herein as a foreign action), the claiming party will be deemed to have consented to (i) the personal 42 jurisdiction of the specified Delaware courts in connection with any action brought in any such courts to enforce the exclusive forum provision described above and (ii) having service of process made upon such claiming party in any such enforcement action by service upon such claiming party’s counsel in the foreign action as agent for such claiming party.
If the estimates of the 29 quality of our sand reserves, including the volumes of the various specifications of those reserves, prove to be inaccurate, we may incur significantly higher excavation costs without corresponding increases in revenues, we may not be able to meet our contractual obligations, or our facilities may have a shorter than expected reserve life, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.
If the estimates of the quality of our sand reserves, including the volumes of the various specifications of those reserves, prove to be inaccurate, we may incur significantly higher excavation costs without corresponding increases in revenues, we may not be able to meet our contractual obligations, or our facilities may have a shorter than expected reserve life, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Our certificate of incorporation provides that, subject to limited exceptions, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for: 43 • Any derivative action or proceeding brought on our behalf; • Any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; • Any action asserting a claim against us arising pursuant to any provision of the Delaware General Corporation Law; or • Any other action asserting a claim against us that is governed by the internal affairs doctrine.
Our certificate of incorporation provides that, subject to limited exceptions, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for: • Any derivative action or proceeding brought on our behalf; • Any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; • Any action asserting a claim against us arising pursuant to any provision of the Delaware General Corporation Law; or • Any other action asserting a claim against us that is governed by the internal affairs doctrine.
In some cases, we may be required to bear the cost of a ready workforce and equipment that is larger than necessary, which could impact our cash flow, expenses and profitability. If an expected contract award or the related work release is delayed or not received, we could incur substantial costs without receipt of any corresponding revenues.
In some cases, we may be required to bear the cost of a ready workforce and equipment that is larger than necessary, which could impact our cash flow, expenses and profitability. If an expected contract award or the related work release is delayed or not received, we could incur substantial costs without receipt 27 of any corresponding revenues.
Moreover, construction projects for which our services are contracted may require significant expenditures by us prior to receipt of relevant payments from the customer. Finally, the winding down or 28 completion of work on significant projects that were active in previous periods will reduce our revenue and earnings if such significant projects have not been replaced in the current period.
Moreover, construction projects for which our services are contracted may require significant expenditures by us prior to receipt of relevant payments from the customer. Finally, the winding down or completion of work on significant projects that were active in previous periods will reduce our revenue and earnings if such significant projects have not been replaced in the current period.
Further, future weakness in commodity prices could impact our business going forward, and we could encounter difficulties such as an inability to access needed capital on attractive terms or at all, recognizing asset impairment charges, an inability to meet financial ratios contained in our debt agreements, a need to reduce our capital spending and other similar impacts.
Further, future weakness in commodity prices could impact our business going forward, and we could 23 encounter difficulties such as an inability to access needed capital on attractive terms or at all, recognizing asset impairment charges, an inability to meet financial ratios contained in our debt agreements, a need to reduce our capital spending and other similar impacts.
If these assumptions prove to be inaccurate, some or all of our reserves may not be economically mineable, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In addition, our current customer contracts require us to deliver frac sand that meets certain specifications.
If these assumptions prove to be inaccurate, some or all of our reserves may not be economically mineable, 28 which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In addition, our current customer contracts require us to deliver frac sand that meets certain specifications.
We may be unable to generate sufficient cash from operations and other capital resources to meet our operating needs and/or maintain planned or future levels of capital expenditures which, among other things, may prevent us from acquiring new equipment, properly maintaining our existing equipment or restarting idled businesses or expanding existing operations as demand may warrant.
We may be unable to generate sufficient cash from operations and other capital resources to meet our operating needs and/or maintain planned or future levels of capital expenditures which, among other things, may prevent us from acquiring new equipment, properly maintaining our existing equipment or restarting idled businesses or expanding existing 33 operations as demand may warrant.
For example, shareholder activism has recently been increasing in our industry, and shareholders may attempt to effect changes to our business or governance to deal with climate change-related issues, whether by shareholder proposals, public campaigns, proxy solicitations or otherwise, which may result in significant management distraction and potentially significant expense.
For example, shareholder activism has recently been increasing in our industry, and shareholders may attempt to effect changes to our business or governance to deal with climate change-related issues, whether by shareholder proposals, public campaigns, proxy solicitations or otherwise, which 24 may result in significant management distraction and potentially significant expense.
Future hydraulic fracturing-related legislation or regulations could restrict the ability of our customers to utilize, or increase the cost associated with, hydraulic fracturing, which could reduce demand for our proppants and adversely affect our business, financial condition, results of operations and cash flows. For additional information regarding the regulation of hydraulic fracturing, see Item 1.
Future hydraulic fracturing-related legislation or regulations could restrict the ability of our customers to utilize, or increase the cost associated with, hydraulic fracturing, which could reduce demand for our proppants and adversely affect our business, financial condition, 29 results of operations and cash flows. For additional information regarding the regulation of hydraulic fracturing, see Item 1.
The principal competitive factors in our markets are price, product and service quality and availability, responsiveness, experience, 36 technology, equipment quality and reputation for safety. We compete with large national and multi-national companies that have longer operating histories, greater financial, technical and other resources and greater name recognition than we do.
The principal competitive factors in our markets are price, product and service quality and availability, responsiveness, experience, technology, equipment quality and reputation for safety. We compete with large national and multi-national companies that have longer operating histories, greater financial, technical and other resources and greater name recognition than we do.
Liabilities for which we are not insured, or which exceed the policy limits of our applicable insurance, could have a material adverse effect on our business activities, financial condition and results of operations. We may be subject to claims for personal injury and property damage, which could materially adversely affect our financial condition and results of operations.
Liabilities for which we are not insured, or which exceed the policy limits of our applicable insurance, could have a material adverse effect on our business activities, financial condition and results of operations. 38 We may be subject to claims for personal injury and property damage, which could materially adversely affect our financial condition and results of operations.
We also handle, transport and store these substances. The handling, transportation, storage and disposal of these fluids are regulated by a number of laws, including: the Resource Conservation and Recovery Act; the Comprehensive 37 Environmental Response, Compensation, and Liability Act; the Clean Water Act; the Safe Drinking Water Act; and other federal and state laws and regulations promulgated thereunder.
We also handle, transport and store these substances. The handling, transportation, storage and disposal of these fluids are regulated by a number of laws, including: the Resource Conservation and Recovery Act; the Comprehensive Environmental Response, Compensation, and Liability Act; the Clean Water Act; the Safe Drinking Water Act; and other federal and state laws and regulations promulgated thereunder.
Further, any disruptions or continuing volatility in the global financial markets and rising interest rates due to efforts to curb persistent inflation may lead to a contraction in credit availability and an 34 increase in our cost of capital, which will adversely impact our ability to finance our operations.
Further, any disruptions or continuing volatility in the global financial markets and rising interest rates due to efforts to curb persistent inflation may lead to a contraction in credit availability and an increase in our cost of capital, which will adversely impact our ability to finance our operations.
As a result, some local water districts have begun restricting the use of water subject to their jurisdiction for hydraulic fracturing to protect local water supply. For example, in 2021, the Texas Legislature directed the Texas Railroad Commission to adopt rules encouraging fluid oil and gas waste recycling.
As a result, some local water districts have begun restricting the use of water subject to their jurisdiction for hydraulic fracturing to protect local water supply. For example, in 2021, the Texas Legislature directed the 30 Texas Railroad Commission to adopt rules encouraging fluid oil and gas waste recycling.
We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for income taxes. We do not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon 39 challenge by a tax authority.
We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for income taxes. We do not recognize the benefit of income tax positions we believe are more likely than not to be disallowed upon challenge by a tax authority.
These variations, along with other risks inherent in performing fixed price contracts, could cause actual project revenue 27 and profits to differ from original estimates, which could result in lower margins than anticipated, or losses, which could reduce our profitability, cash flows and liquidity.
These variations, along with other risks inherent in performing fixed price contracts, could cause actual project revenue and profits to differ from original estimates, which could result in lower margins than anticipated, or losses, which could reduce our profitability, cash flows and liquidity.
We may also be subject to litigation in the normal course of business involving allegations of violations of the Fair Labor Standards Act and state wage and hour laws. 32 Claimants may seek large damage awards and defending claims can involve significant costs.
We may also be subject to litigation in the normal course of business involving allegations of violations of the Fair Labor Standards Act and state wage and hour laws. Claimants may seek large damage awards and defending claims can involve significant costs.
Our business may suffer a material adverse effect in the event we have title deficiencies. 38 In some instances, we have received access rights or easements from third parties, which allow for a more efficient operation than would exist without the access or easement.
Our business may suffer a material adverse effect in the event we have title deficiencies. In some instances, we have received access rights or easements from third parties, which allow for a more efficient operation than would exist without the access or easement.
A variety of factors could negatively affect these costs, such as lower than anticipated productivity, conditions at work sites differing materially from those anticipated at the time we bid on the contract and higher than expected costs of materials and labor.
A variety of factors could negatively affect these costs, such as lower than anticipated productivity, conditions at work sites 26 differing materially from those anticipated at the time we bid on the contract and higher than expected costs of materials and labor.
We may be unable to obtain sufficient bonding capacity to support certain service offerings, and the need for performance and surety bonds could reduce availability under our credit facility. Some of our infrastructure services contracts require performance and payment bonds.
We may be unable to obtain sufficient bonding capacity to support certain service offerings, and the need for performance and surety bonds could reduce availability under our revolving credit facility. Some of our infrastructure services contracts require performance and payment bonds.
In addition, even if we are able to successfully renew or obtain performance or payment bonds, we may be required to post letters of credit in connection with the bonds, which would reduce availability under our credit facility.
In addition, even if we are able to successfully renew or obtain performance or payment bonds, we may be required to post letters of credit in connection with the bonds, which would reduce availability under our revolving credit facility.
These actions and proceedings may seek, among other things, compensation for alleged personal injury, workers’ compensation, employment discrimination and other employment-related damages, breach of contract, indemnity claims, property damage and violation of federal or state securities laws.
These actions and proceedings may seek, among other things, compensation for alleged personal injury, workers’ compensation, employment discrimination and other employment-related damages, breach of contract, indemnity claims, 31 property damage and violation of federal or state securities laws.
The failure to continue to upgrade our technical, administrative, operating and financial control systems or the occurrences of unexpected expansion difficulties, including the failure to recruit and retain experienced managers, engineers and other professionals in the energy services industry, could have a material adverse effect on our business, financial condition, results of operations and our ability to successfully or timely execute our business plan. 35 If our intended expansion of our business is not successful, our financial condition, profitability and results of operations could be adversely affected, and we may not achieve increases in revenue and profitability that we hope to realize.
The failure to continue to upgrade our technical, administrative, operating and financial control systems or the occurrences of unexpected expansion difficulties, including the failure to recruit and retain experienced managers, engineers and other professionals in the energy services industry, could have a material adverse effect on our business, financial condition, results of operations and our ability to successfully or timely execute our business plan. 34 If our intended expansion of our business is not successful, our financial condition, profitability and results of operations could be adversely affected, and we may not achieve increases in revenue and profitability that we hope to realize.
The occurrence of any of these events could have a material adverse effect on our business, cash flows, results of operations and financial position. 26 Advancements in oilfield service technologies could have a material adverse effect on our business, financial condition, results of operations and cash flows.
The occurrence of any of these events could have a material adverse effect on our business, cash flows, results of operations and financial position. Advancements in oilfield service technologies could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Many factors over which we have no control affect the supply of and demand for, and our customers’ willingness to explore, develop and produce oil and natural gas, and therefore, influence prices for our products and services, including: • the domestic and foreign supply of and demand for oil and natural gas; • the level of prices, and expectations about future prices, of oil and natural gas; • the level of global oil and natural gas exploration and production; • the cost of exploring for, developing, producing and delivering oil and natural gas; • the expected decline rates of current production; • the price and quantity of foreign imports; • political and economic conditions in oil producing countries, including the Middle East, Africa, South America and Russia, including the impact of the ongoing war in Ukraine and the recent Israel-Hamas war on the global energy and capital markets and global stability; 23 • the ability of members of the Organization of Petroleum Exporting Countries to agree to and maintain oil price and production controls; • speculative trading in crude oil and natural gas derivative contracts; • the level of consumer product demand; • the discovery rates of new oil and natural gas reserves; • contractions in the credit market; • the strength or weakness of the U.S. dollar; • available pipeline and other transportation capacity; • the levels of oil and natural gas storage; • weather conditions and other natural disasters; • political instability in oil and natural gas producing countries; • domestic and foreign tax policy; • domestic and foreign governmental approvals and regulatory requirements and conditions; • the continued threat of terrorism and the impact of military and other action, including military action in the Middle East; • technical advances affecting energy consumption; • the proximity and capacity of oil and natural gas pipelines and other transportation facilities; • the price and availability of alternative fuels; • the ability of oil and natural gas producers to raise equity capital and debt financing; • global or national health concerns, including the outbreak of pandemic or contagious diseases; • merger and divestiture activity among oil and natural gas producers; • governmental laws, policies, regulations, subsidies, and other actions, including initiatives to promote the use of renewable energy sources; and • overall domestic and global economic conditions.
Many factors over which we have no control affect the supply of and demand for, and our customers’ willingness to explore, develop and produce oil and natural gas, and therefore, influence prices for our products and services, including: • the domestic and foreign supply of and demand for oil and natural gas; • the level of prices, and expectations about future prices, of oil and natural gas; • the level of global oil and natural gas exploration and production; • the cost of exploring for, developing, producing and delivering oil and natural gas; • the expected decline rates of current production; • the price and quantity of foreign imports; • political and economic conditions in oil producing countries, including the Middle East, Africa, South America and Russia, including the impact of the war in Ukraine and the instability in the Middle East on the global energy and capital markets and global stability; • the ability of members of the Organization of Petroleum Exporting Countries to agree to and maintain oil price and production controls; • speculative trading in crude oil and natural gas derivative contracts; • the level of consumer product demand; • the discovery rates of new oil and natural gas reserves; • contractions in the credit market; • the strength or weakness of the U.S. dollar; • available pipeline and other transportation capacity; • the levels of oil and natural gas storage; • weather conditions and other natural disasters; • political instability in oil and natural gas producing countries; • domestic and foreign tax policy; • domestic and foreign tariffs; • domestic and foreign governmental approvals and regulatory requirements and conditions; • the continued threat of terrorism and the impact of military and other action, including military action in the Middle East; • technical advances affecting energy consumption; • the proximity and capacity of oil and natural gas pipelines and other transportation facilities; • the price and availability of alternative fuels; • the ability of oil and natural gas producers to raise equity capital and debt financing; • global or national health concerns, including the outbreak of pandemic or contagious diseases; • merger and divestiture activity among oil and natural gas producers; • governmental laws, policies, regulations, subsidies, and other actions, including initiatives to promote the use of renewable energy sources; and • overall domestic and global economic conditions.
As cyber incidents continue to evolve, we may be required to expend additional resources to continue to modify or enhance our 40 protective measures or to investigate and remediate any vulnerability to cyber incidents.
As cyber incidents continue to evolve, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerability to cyber incidents.
Our revolving credit facility and term credit facility limit, our ability to take various actions, such as: • incurring additional indebtedness; • paying dividends; • creating certain additional liens on our assets; • entering into sale and leaseback transactions; • making investments; • entering into transactions with affiliates; • making material changes to the type of business we conduct or our business structure; • making guarantees; • entering into hedges; • disposing of assets in excess of certain permitted amounts; • merging or consolidating with other entities; and • selling all or substantially all of our assets.
Our revolving credit facility limits our ability to take various actions, such as: • incurring additional indebtedness; • paying dividends; • creating certain additional liens on our assets; • entering into sale and leaseback transactions; • making investments; • entering into transactions with affiliates; • making material changes to the type of business we conduct or our business structure; • making guarantees; • entering into hedges; • disposing of assets in excess of certain permitted amounts; • merging or consolidating with other entities; and • selling all or substantially all of our assets.
For example, the Oklahoma Corporations Commission has implemented a variety of measures, including the adoption of the National Academy of Science’s “traffic light system,” pursuant to which the agency reviews new disposal well applications and may restrict operations at existing wells.
For example, the Oklahoma Corporation Commission has implemented a variety of measures, including the adoption of the National Academy of Science’s “traffic light system,” pursuant to which the agency reviews new disposal well applications and may restrict operations at existing wells.
These provisions create the possibility that a corporate opportunity that would otherwise be available to us may be used for the benefit of one of our affiliates. We have engaged in transactions with our affiliates and expect to do so in the future.
These provisions create the possibility that a corporate opportunity that would otherwise be available to us may be used for the benefit of one of our affiliates. We have engaged and expect to continue to engage in transactions with our affiliates and expect to do so in the future.
Repercussions of severe weather conditions may include: • curtailment of services; • weather-related damage to equipment resulting in suspension of operations; • weather-related damage to our facilities; 33 • inability to deliver equipment and materials to jobsites in accordance with contract schedules; and • loss of productivity.
Repercussions of severe weather conditions may include: • curtailment of services; 32 • weather-related damage to equipment resulting in suspension of operations; • weather-related damage to our facilities; • inability to deliver equipment and materials to jobsites in accordance with contract schedules; and • loss of productivity.
When a major customer discontinues the use our services, our revenue will decline and our operating results and financial condition will be harmed unless such loss is offset by new business. Our top five customers accounted for approximately 35%, 36% and 35%, respectively, of our revenue for the years ended December 31, 2023, 2022 and 2021.
When a major customer discontinues the use our services, our revenue will decline and our operating results and financial condition will be harmed unless such loss is offset by new business. Our top five customers accounted for approximately 34%, 35% and 36%, respectively, of our revenue for the years ended December 31, 2024, 2023 and 2022.
Industry conditions are dynamic and the weakening of commodity prices from current levels may result in a material adverse impact on certain of our customers’ liquidity and financial position resulting in spending reductions, delays in the collection of amounts owing to us and similar impacts.
Industry conditions are dynamic and the weakening of commodity prices may result in a material adverse impact on certain of our customers’ liquidity and financial position resulting in spending reductions, delays in the collection of amounts owing to us and similar impacts.
Investor and regulatory focus on environmental, social and governance (“ESG”) matters continues to increase. In addition to climate change, there is increasing attention on topics such as diversity and inclusion, human rights, and human and natural capital, in companies’ own operations as well as their supply chains.
Investor and regulatory focus on environmental, social and governance (“ESG”) matters continues to increase. In addition to climate change, there remains attention on topics such as diversity and inclusion, human rights, and human and natural capital, in companies’ own operations as well as their supply chains.
A portion of our continental United States-based infrastructure services revenue is derived from project-based work that is awarded through a competitive bid process. It is generally very difficult to predict the timing and geographic distribution of the projects that we will be awarded.
A portion of our infrastructure services revenue is derived from project-based work that is awarded through a competitive bid process. It is generally very difficult to predict the timing and geographic distribution of the projects that we will be awarded.
The one-year contract, as amended, provided for payments of up to $945 million (the “first contract”). On May 26, 2018, Cobra and PREPA entered into a second one-year, 20 $900 million master services agreement to provide additional repair services and begin the initial phase of reconstruction of the electrical power system in Puerto Rico (the “second contract”).
The one-year contract, as amended, provided for payments of up to $945 million. On May 26, 2018, Cobra and PREPA entered into a second one-year, $900 million master services agreement to provide additional repair services and begin the initial phase of reconstruction of the electrical power system in Puerto Rico.
If existing environmental requirements or enforcement policies change and become more stringent, we may be required to make significant unanticipated capital and operating expenditures. For a detailed description of environmental laws and regulations applicable to us and their impact on our operations, see “Item 1. Business—Regulations” above.
If existing environmental requirements or enforcement policies change and become more stringent, we may be required to make significant unanticipated capital and operating expenditures. For a detailed description of environmental laws and regulations applicable to us and their impact on our operations, see Item 1. “Business—Regulations” above.
For the years ended December 31, 2023 and 2022, we generated approximately 48% and 45%, respectively, of our revenue from our operations in Ohio, Wisconsin, Minnesota, North Dakota, Pennsylvania, West Virginia and Canada where weather conditions may be severe, particularly during winter and spring months.
For the years ended December 31, 2024 and 2023, we generated approximately 35% and 48%, respectively, of our revenue from our operations in Ohio, Wisconsin, Minnesota, North Dakota, Pennsylvania, West Virginia and Canada where weather conditions may be severe, particularly during winter and spring months.
In this regard, due to market conditions, we have temporarily shut down certain of our service offerings, including contract land drilling, flowback, cementing, acidizing and crude oil hauling operations as well as certain of our facilities, such as our sand processing plant in Pierce County, Wisconsin.
In this regard, due to market conditions, we have idled certain of our service offerings, including contract land drilling, flowback, cementing, acidizing and crude oil hauling operations as well as certain of our facilities, such as our sand processing plant in Pierce County, Wisconsin.
We fund our capital expenditures primarily with cash generated by operations and borrowings under our revolving credit facility and term loan facility.
We fund our capital expenditures primarily with cash generated by operations and borrowings under our revolving credit facility.
Changes in currency exchange rates could adversely affect our combined results of operations or financial position. We also maintain cash balances denominated in the Canadian dollar. At December 31, 2023, we had $2.4 million of cash in Canadian dollars, in Canadian accounts.
Changes in currency exchange rates could adversely affect our combined results of operations or financial position. We also maintain cash balances denominated in the Canadian dollar. At December 31, 2024, we had $4.0 million of cash in Canadian dollars, in Canadian accounts.
Other significant factors that are likely to continue to affect commodity prices in current and future periods include, but are not limited to, the effect of U.S. energy, monetary and trade policies, U.S. and global political developments, conditions in the U.S. oil and gas industry, actions of OPEC+ members, the impact of the ongoing war in Ukraine and the recent Israel-Hamas war on the global energy and capital markets and global stability and other factors.
Other significant factors that are likely to continue to affect commodity prices in current and future periods include, but are not limited to, the effect of U.S. energy, monetary and trade policies, U.S. and global political developments, conditions in the U.S. oil and gas industry, actions of OPEC+ members, the impact of the ongoing war in Ukraine and the instability in the Middle East on the global energy and capital markets and global stability and other factors.
As described elsewhere in this report, including in the notes to our consolidated financial statements, these transactions include, among others, a joint venture, agreements to provide our services and frac sand products to our affiliates and agreements pursuant to which our affiliates provide us with facilities.
As described elsewhere in this report, including in the notes to our consolidated financial statements, these transactions include, among others, a joint venture and agreements pursuant to which our affiliates provide us with facilities.
Commitments and Contingencies to our consolidated financial statements elsewhere in this annual report. We rely on a few key employees whose absence or loss could adversely affect our business. Many key responsibilities within our business have been assigned to a small number of employees. The loss of their services could adversely affect our business.
“Commitments and Contingencies” to our consolidated financial statements included elsewhere in this annual report. We rely on a few key employees whose absence or loss could adversely affect our business. Many key responsibilities within our business have been assigned to a small number of employees. The loss of their services could adversely affect our business.
However, the broader consequences of the Russian-Ukrainian conflict, and the Israel-Hamas war may increase volatility in the price and demand for oil and natural gas, which would adversely impact the oilfield services industry, increase exposure to cyberattacks, cause disruptions in global supply chains, increase foreign currency fluctuations, cause constraints or disruption in the capital markets and limit sources of liquidity.
However, the broader consequences of the Russian-Ukrainian conflict, and the instability in the Middle East may increase volatility in the price and demand for oil and natural gas, which would adversely impact the oilfield services industry, increase exposure to cyberattacks, cause disruptions in global supply chains, increase foreign currency fluctuations, cause constraints or disruption in the capital markets and limit sources of liquidity.
As a component of our business strategy, we have pursued and, subject to our liquidity needs, intend to continue to pursue selected, accretive acquisitions of complementary assets, businesses and technologies.
As a component of our business strategy, we have pursued and intend to continue to pursue selected, accretive acquisitions of complementary assets, businesses and technologies.
The corporate opportunity provisions in our certificate of incorporation could enable Wexford or other affiliates of ours to benefit from corporate opportunities that might otherwise be available to us. 41 Subject to the limitations of applicable law, our certificate of incorporation, among other things: • permits us to enter into transactions with entities in which one or more of our officers or directors are financially or otherwise interested; • permits any of our stockholders, officers or directors to conduct business that competes with us and to make investments in any kind of property in which we may make investments; and • provides that if any director or officer of one of our affiliates who is also one of our officers or directors becomes aware of a potential business opportunity, transaction or other matter (other than one expressly offered to that director or officer in writing solely in his or her capacity as our director or officer), that director or officer will have no duty to communicate or offer that opportunity to us, and will be permitted to communicate or offer that opportunity to such affiliates and that director or officer will not be deemed to have (i) acted in a manner inconsistent with his or her fiduciary or other duties to us regarding the opportunity or (ii) acted in bad faith or in a manner inconsistent with our best interests.
Subject to the limitations of applicable law, our certificate of incorporation, among other things: • permits us to enter into transactions with entities in which one or more of our officers or directors are financially or otherwise interested; • permits any of our stockholders, officers or directors to conduct business that competes with us and to make investments in any kind of property in which we may make investments; and • provides that if any director or officer of one of our affiliates who is also one of our officers or directors becomes aware of a potential business opportunity, transaction or other matter (other than one expressly offered to that director or officer in writing solely in his or her capacity as our director or officer), that director or officer will have no duty to communicate or offer that opportunity to us, and will be permitted to communicate or offer that 40 opportunity to such affiliates and that director or officer will not be deemed to have (i) acted in a manner inconsistent with his or her fiduciary or other duties to us regarding the opportunity or (ii) acted in bad faith or in a manner inconsistent with our best interests.
If we are successful in being awarded government contracts, significant costs could be incurred by us before any revenues were realized from these contracts. Government agencies may review a contractor’s performance, cost structure and compliance with applicable laws, regulations and standards.
Most government contracts are awarded through a regulated competitive bidding process. If we are successful in being awarded government contracts, significant costs could be incurred by us before any revenues were realized from these contracts. Government agencies may review a contractor’s performance, cost structure and compliance with applicable laws, regulations and standards.
At times during the business cycle, there is a high demand for hydraulic fracturing and other oilfield services and extended lead times to obtain equipment needed to provide these services. Further, there are a limited number of suppliers that manufacture the equipment we use.
We purchase specialized equipment and parts from third party suppliers. At times during the business cycle, there is a high demand for hydraulic fracturing and other oilfield services and extended lead times to obtain equipment needed to provide these services. Further, there are a limited number of suppliers that manufacture the equipment we use.
Our operations require substantial capital and we may be unable to obtain needed capital or financing on satisfactory terms or at all, which could limit our ability to grow. Our capital budget for 2024 is estimated to be $15 million, depending upon industry conditions and our financial results.
Our operations require substantial capital and we may be unable to obtain needed capital or financing on satisfactory terms or at all, which could limit our ability to grow or conduct our business. Our capital budget for 2025 is estimated to be $12 million, depending upon industry conditions and our financial results.
Our revolving credit facility and term credit facility provide for fluctuating interest rates, which may increase or decrease our interest expense. Our revolving credit facility and term credit facility provide for fluctuating interest rates, primarily based on rates set by the U.S. Federal Reserve.
Our revolving credit facility provides for fluctuating interest rates, which may increase or decrease our interest expense. Our revolving credit facility provides for fluctuating interest rates, primarily based on rates set by the U.S. Federal Reserve.
However, in the event PREPA (i) does not have or does not obtain the funds necessary to satisfy its obligations to Cobra under the contracts, (ii) obtains the necessary funds but refuses to pay the amounts owed to us or (iii) otherwise does not pay amounts owed to us for services performed, the receivable may not be collected and our financial condition, results of operations and cash flows would be materially and adversely affected.
In the event PREPA (i) does not have or does not obtain the funds necessary to satisfy its obligations to Cobra under the Settlement Agreement, (ii) obtains the necessary funds but refuses to pay the amounts owed to us or (iii) otherwise does not pay amounts owed to us under the Settlement Agreement, the receivable may not be collected and our financial condition, results of operations and cash flows may be materially and adversely affected.
We cannot predict the impact of the ongoing war in Ukraine and the recent Israel-Hamas war on the global economy, energy markets, geopolitical stability, industries in which we operate and our business. All of our infrastructure, well completion, natural sand proppant, drilling and other services are concentrated in North America.
We cannot predict the impact of the ongoing war in Ukraine and the instability in the Middle East on the global economy, energy markets, geopolitical stability, industries in which we operate and our business. All of our infrastructure, well completion, natural sand proppant, and other services are concentrated in North America.
No assurance can be given that we will effectuate stock buybacks in the future, which could materially and adversely affect the market price of our common stock. We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2023 or to date.
No assurance can be given that we will effectuate stock buybacks in the future, which could materially and adversely affect the market price of our common stock. We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2024 or to date. Item 1B. Unresolved Staff Comments None.
Our customer base is concentrated and the loss of one or more of our significant customers, or their failure to pay the amounts they owe us, could cause our revenue to decline substantially.
Risks Related to Our Business and the Industries We Serve Our customer base is concentrated and the loss of one or more of our significant customers, or their failure to pay the amounts they owe us, could cause our revenue to decline substantially.
Sales of these shares of common stock or sales of substantial amounts of our common stock by other 42 stockholders, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock. As of December 31, 2023, Wexford beneficially owned 47.1% shares of our common stock.
Sales of these shares of common stock or sales of substantial amounts of our common stock by other stockholders, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock. As of December 31, 2024, Wexford beneficially owned 45.9% shares of our common stock.
Any nonperformance by our counterparties, including their failure to pay the amounts they owe us on a timely basis or at all, either as a result of changes in financial and economic conditions or otherwise, could have a material adverse impact on our operating results and could adversely affect our liquidity. 21 We may experience losses in excess of our recorded reserves for receivables.
Any nonperformance by our counterparties, including their failure to pay the amounts they owe us on a timely basis or at all, either as a result of changes in financial and economic conditions or otherwise, could have a material adverse impact on our operating results and could adversely affect our liquidity.
Business — Regulation of Hydraulic Fracturing included elsewhere in this annual report. 30 We face distribution and logistics challenges in our business.
“Business — Regulation of Hydraulic Fracturing” included elsewhere in this annual report. We face distribution and logistics challenges in our business.
Further, as noted above, our contracts with PREPA have concluded and we have not obtained, and there can be no assurance that we will be able to obtain, one or more contracts with other customers to replace the level of services that we provided to PREPA.
Further, as noted above, our contracts with PREPA have concluded and we have not obtained, and there can be no assurance that we will be able to obtain, one or more contracts with other customers to replace the level of services that we provided to PREPA. Opportunities associated with government contracts could lead to increased governmental regulation applicable to us.
The market price for our common stock has fluctuated significantly, ranging from a high of $8.74 per share to a low of $3.41 per share during 2023. In addition, in the absence of an active public trading market, investors may be unable to liquidate their investment in us.
The market price for our common stock has fluctuated significantly, ranging from a high of $4.94 per share to a low of $2.50 per share during 2024. In addition, in the absence of an active public trading market, investors may be unable to liquidate their investment in us.
Our operations include hazards inherent in the oil and natural gas and energy infrastructure industries, such as equipment defects, vehicle accidents, fires, explosions, blowouts, surface cratering, uncontrollable flows of gas or well fluids, pipe or pipeline failures, abnormally pressured formations and various environmental hazards such as oil spills and releases of, and exposure to, hazardous substances.
Our operations are subject to hazards inherent in the oil and natural gas and energy infrastructure industries, which could expose us to substantial liability and cause us to lose customers and substantial revenue. 35 Our operations include hazards inherent in the oil and natural gas and energy infrastructure industries, such as equipment defects, vehicle accidents, fires, explosions, blowouts, surface cratering, uncontrollable flows of gas or well fluids, pipe or pipeline failures, abnormally pressured formations and various environmental hazards such as oil spills and releases of, and exposure to, hazardous substances.
As a result, Wexford can exercise significant influence over matters requiring stockholder approval, including the election of directors, changes to our organizational documents and significant corporate transactions. Further, individuals who serve as our directors are affiliates of Wexford.
Wexford, through its affiliates, beneficially owns approximately 45.9% of our outstanding common stock. As a result, Wexford can exercise significant influence over matters requiring stockholder approval, including the election of directors, changes to our organizational documents and significant corporate transactions. Further, individuals who serve as our directors are affiliates of Wexford.
Increasing trucking regulations may increase our costs and negatively impact our results of operations. In connection with our business operations, including the transportation and relocation of our energy service equipment, shipment of frac sand and general freight hauling, we operate trucks and other heavy equipment.
In connection with our business operations, including the transportation and relocation of our energy service equipment, shipment of frac sand and general freight hauling, we operate trucks and other heavy equipment.
Increased regulation by state and federal governments related to cybersecurity protections and disclosures may require additional resources for compliance, and any inability, or perceived inability, to adequately address new requirements could subject us to regulatory enforcement, private litigation, public criticism, disrupt our operations, cause us to lose customers, result in additional costs and legal liability, damage our reputation or otherwise harm our business.
Increased regulation by state and federal governments related to cybersecurity protections and disclosures may require additional resources for compliance, and any inability, or perceived inability, to adequately address new requirements could subject us to regulatory enforcement, private litigation, public criticism, disrupt our operations, cause us to lose customers, result in additional costs and legal liability, damage our reputation or otherwise harm our business. 39 Risks Inherent to Our Common Stock Our largest stockholder controls a significant percentage of our common stock, and its interests may conflict with those of our other stockholders.
If securities or industry analysts do not publish research or reports about our business, if they adversely revise their recommendations regarding our stock or if our operating results do not meet their expectations, the price of our stock could decline.
If securities or industry analysts do not publish research or reports about our business, if they adversely revise their recommendations regarding our stock or if our operating results do not meet their expectations, the price of our stock could decline. 41 The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business.
Increasing attention to global climate change has resulted in increased investor attention and an increased risk of public and private litigation, which could increase our costs or otherwise adversely affect us.
However, President Trump has indicated his support for rescission of these climate-related disclosure rules. Increasing attention to global climate change has resulted in increased investor attention and an increased risk of public and private litigation, which could increase our costs or otherwise adversely affect us.
In the event that PREPA does not pay amounts owed to us for services performed, our financial condition, results of operations and cash flows would be materially and adversely affected. On October 19, 2017, one of our subsidiaries, Cobra, and PREPA entered into an emergency master services agreement for repairs to PREPA’s electrical grid as a result of Hurricane Maria.
In the event that PREPA does not pay the remaining amount owed to us under the Settlement Agreement, our financial condition, results of operations and cash flows may be materially and adversely affected. On October 19, 2017, Cobra Acquisitions LLC, or Cobra, and PREPA entered into an emergency master services agreement for repairs to PREPA’s electrical grid.
Inflation in the U.S. has been rising at its fastest rate in over 40 years, creating inflationary pressure on the cost of services, equipment and other goods in our industries and other sectors and contributing to labor and materials shortages across the supply-chain.
During the last two years, inflation in the U.S. reached some of the highest levels in over 40 years, creating inflationary pressure on the cost of services, equipment and other goods in our industries and other sectors and contributing to labor and materials shortages across the supply-chain.
Prices for oil and natural gas historically have been extremely volatile and are expected to continue to be volatile in the years to come. During 2023, West Texas Intermediate posted prices ranged from $66.74 to $93.68 per barrel and the New York Mercantile Exchange natural 24 gas futures prices ranged from $1.99 to $4.48 per MMBtu.
Prices for oil and natural gas historically have been extremely volatile and are expected to continue to be volatile in the years to come. During 2024, West Texas Intermediate posted prices ranged from $65.75 to $86.91 per barrel and the New York Mercantile Exchange natural gas futures prices ranged from $1.58 to $3.95 per MMBtu.
We contract with truck and rail services to move frac sand from our production facilities to transload sites and our customers, and increased costs under these contracts could adversely affect our results of operations. In addition, we bear the risk of non-delivery under our contracts.
The relatively high transportation expenses and related costs tend to favor frac sand producers located in close proximity to their customers. We contract with truck and rail services to move frac sand from our production facilities to transload sites and our customers, and increased costs under these contracts could adversely affect our results of operations.
In October 2023, the Commission announced draft amendments to its water protection rules to, among other things, encourage waste recycling. Our inability, or 31 customers’ inability, to obtain water to use in our operations from local sources or to effectively utilize flowback water could have an adverse effect on our business, financial condition, results of operations and cash flows.
Our inability, or customers’ inability, to obtain water to use in our operations from local sources or to effectively utilize flowback water could have an adverse effect on our business, financial condition, results of operations and cash flows.
Legislation or regulatory initiatives intended to address seismic activity could restrict our drilling and production activities, as well as our ability to dispose of produced water gathered from such activities, which could have a material adverse effect on our business.
Any changes in laws requiring us to use equipment that runs on alternative fuels could require a significant investment, which could have a material adverse effect on our results of operations, cash flows and liquidity. 36 Legislation or regulatory initiatives intended to address seismic activity could restrict our drilling and production activities, as well as our ability to dispose of produced water gathered from such activities, which could have a material adverse effect on our business.
We evaluate the collectability of our receivables based on consideration of a customer’s ability to make required payments, payment history, economic events and other factors. Recorded reserves represent our estimate of current expected credit losses on existing receivables and are determined based on historical customer reviews, current financial conditions and reasonable and supportable forecasts.
Recorded reserves represent our estimate of current expected credit losses on existing receivables and are determined based on historical customer reviews, current financial conditions and reasonable and supportable forecasts.
We cannot predict the extent of these wars’ effect on our business and results of operations as well as on the global economy, energy markets and industries in which we operate. The outcomes of investigations and litigation relating to our contracts with PREPA may have a material adverse effect on our business, financial condition, results of operations and cash flows.
We cannot predict the extent of these wars’ effect on our business and results of operations as well as on the global economy, energy markets and industries in which we operate. Cobra, one of our infrastructure services subsidiaries, was party to service contracts with PREPA.
The oilfield services industry is characterized by rapid and significant technological advancements and introductions of new products and services using new technologies. As new horizontal and directional drilling, pressure pumping, pressure control and well service technologies develop, we may be placed at a competitive disadvantage, and competitive pressure may force us to implement new technologies at a substantial cost.
The oilfield services industry is characterized by rapid and significant technological advancements and introductions of new products and services using new technologies. As competitors and others use or develop new technologies or technologies comparable to ours in the future, we may lose market share or be placed at a competitive disadvantage.
Item 1A. Risk Factors Risks Related to Our Business and the Industries We Serve Cobra, one of our infrastructure services subsidiaries, was party to service contracts with PREPA. Due to PREPA’s bankruptcy proceedings, PREPA ’ s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
Due to PREPA’s bankruptcy proceedings, PREPA ’ s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
Any of our production facilities or our suppliers’ mines could be subject to a temporary or extended shut down as a result of an alleged MSHA violation. Any such penalties, fines or sanctions could have a material adverse effect on our proppant production and sales business and our overall financial condition, results of operations and cash flows.
Any of our production facilities or our suppliers’ mines could be subject to a temporary or extended shut down as a result of an alleged MSHA violation.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program is integrated into our overall enterprise risk management program, using common methodologies, reporting channels and governance processes that apply to other risks managed by our organization, including operational, financial and strategic risks, as well as applicable legal and regulatory risks.
Biggest changeOur cybersecurity risk management program is integrated into our overall enterprise risk management program, using common methodologies, reporting channels and governance processes that apply to other risks managed by our organization, including operational, financial and strategic risks, as well as applicable legal and regulatory risks. 43 MAMMOTH ENERGY SERVICES, INC.
Laws and regulations governing cybersecurity, data privacy, and the unauthorized disclosure of confidential or protected information pose increasingly complex compliance challenges, and failure to comply with these laws could result in penalties and legal liability. Our insurance coverage for cyberattacks may not be sufficient to cover all the losses we may experience as a result of such cyberattacks. 45
Laws and regulations governing cybersecurity, data privacy, and the unauthorized disclosure of confidential or protected information pose increasingly complex compliance challenges, and failure to comply with these laws could result in penalties and legal liability. Our insurance coverage for cyberattacks may not be sufficient to cover all the losses we may experience as a result of such cyberattacks.
Our internal cybersecurity governance program is led by Mammoth’s Director of Information Technology, with support from the internal information technology department, who reports to our Chief Financial Officer. Our Director of Information Technology has over six years of technological leadership experience along with an extensive background in computer support and application support.
Our internal cybersecurity governance program is led by Mammoth’s Director of Information Technology, with support from the internal information technology department, who reports to our Chief Financial Officer. Our Director of Information Technology has over seven years of technological leadership experience along with an extensive background in computer support and application support.
Risks from cybersecurity threats, incidents or intrusions have not thus far materially affected, and are not currently anticipated to materially affect, our Company, including our business strategy, results of operations or financial condition. See, however, Item 1.A, Risk Factors—“We are subject to cyber security risks.
Risks from cybersecurity threats, incidents or intrusions have not thus far materially affected, and are not currently anticipated to materially affect, our Company, including our business strategy, results of operations or financial condition. See, however, Item 1A. “Risk Factors--We are subject to cyber security risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeBoyd, there were no material changes in mineral (frac sand) resources/mineral (frac sand) reserves, material assumptions or other technical information from those reported in the February 2022 technical report. As a result, we are relying on the February 2022 technical report, as updated by John T. Boyd for immaterial changes in our reserves/resources as of December 31, 2023.
Biggest changeAs a result, we are relying on the February 2022 technical report, as updated by John T. Boyd for immaterial changes in our reserves/resources as of December 31, 2024. Portions of the following information are based on assumptions, qualifications and procedures that are summarized here and are described in more detail in the technical report.
The facility has a 100 ton per hour natural gas fired fluid bed dryer as well as six high-capacity screeners that are capable of producing 0.9 million tons per year. As a result of adverse market conditions, production at our Muskie facility has been temporarily idled since September 2018.
The facility has a 100 ton per hour natural gas fired fluid bed dryer as well as six high-capacity screeners that are capable of producing 0.9 million tons per year. As a result of adverse market conditions, production at our Muskie facility has been idled since September 2018.
Further, as we do not own any mineral rights for the Muskie properties, but, rather, own only the surface rights to the processing plants, we do not (and do not expect to ever) report any reserves attributable to our Muskie property. John T.
Further, as we do not own any mineral rights for the Muskie property, but, rather, own only the surface rights to the processing plants, we do not (and do not expect to ever) report any reserves attributable to our Muskie property. John T.
All of our frac sand facilities are located in Wisconsin, with our Taylor facilities located in Jackson County, our Piranha facilities located in Barron County and our Muskie facilities located in Pierce County. 46 Our frac sand facilities consist of three dry plants with a total permitted capacity of 5.7 million tons of sand per year, and two wet plants, with a total permitted capacity of 8.7 million tons of sand per year, that supply two of the dry plants with Northern White silica sand, which we believe is some of the highest quality raw frac sand available.
All of our frac sand facilities are located in Wisconsin, with our Taylor facilities located in Jackson County, our Piranha facilities located in Barron County and our Muskie facilities located in Pierce County. 45 Our frac sand facilities consist of three dry plants with a total permitted capacity of 5.7 million tons of sand per year, and two wet plants, with a total permitted capacity of 8.7 million tons of sand per year, that supply two of the dry plants with Northern White silica sand, which we believe is some of the highest quality raw frac sand available.
Boyd has determined that all reportable mineral resources for the Taylor and Piranha mines are categorized as proven reserves as the areas are well explored and exhibit acceptable drill hole data spacing to be classified as measured resources. We categorize our sand properties in accordance with the SEC definition in Item 1300 of Regulation S-K.
Boyd has determined that all reportable mineral resources for the Taylor and Piranha mines are categorized as proven reserves as the areas are well explored and exhibit acceptable drill hole data spacing to be classified as measured resources. We categorize our sand properties in accordance with the SEC definition in subpart 1300 of Regulation S-K.
Approximately 148 acres of frac sand resources remain on this 49 property. We own in fee numerous land parcels which comprise the processing plant site, mineral resource areas and rail loadout facility. Our rail loadout facility, located in Trempealeau County, Wisconsin, is approximately two miles southwest of the mine and processing facility. Our Taylor operation commenced mining operations in 2012.
Approximately 148 acres of frac sand resources remain on this 48 property. We own in fee numerous land parcels which comprise the processing plant site, mineral resource areas and rail loadout facility. Our rail loadout facility, located in Trempealeau County, Wisconsin, is approximately two miles southwest of the mine and processing facility. Our Taylor operation commenced mining operations in 2012.
A third-party contractor then “bumps” the sand using explosives on the mine face, 47 which causes the sand to fall into the pit, where it is then carried by truck or conveyor to the wet plant operations. At our wet plants, the mined sand goes through a series of processes designed to separate the sand from unusable materials.
A third-party contractor then “bumps” the sand using explosives on the mine face, 46 which causes the sand to fall into the pit, where it is then carried by truck or conveyor to the wet plant operations. At our wet plants, the mined sand goes through a series of processes designed to separate the sand from unusable materials.
Our Piranha wet plant, which is adjacent to the mine, can process up to 4.7 million tons of wet sand per year and is located two miles from our Piranha dry plant, to which we have year-round trucking access. As of December 31, 2023, the dry plant facility had a rated production capacity of 2.6 million tons per year.
Our Piranha wet plant, which is adjacent to the mine, can process up to 4.7 million tons of wet sand per year and is located two miles from our Piranha dry plant, to which we have year-round trucking access. As of December 31, 2024, the dry plant facility had a rated production capacity of 2.6 million tons per year.
Boyd updates our reserve estimates annually, making necessary adjustments for operations at each location during the year and 48 additions or surveying, drill core analysis and other tests to confirm the quantity and quality of the reserves.
Boyd updates our reserve estimates annually, making necessary adjustments for operations at each location during the year and 47 additions or surveying, drill core analysis and other tests to confirm the quantity and quality of the reserves.
Our finished product is loaded directly into railcars. Our Piranha facility is capable of storing up to 400 railcars. We estimate an overall product yield (after mining and processing losses) of approximately 71% for the Piranha mine. John T.
Our finished product is loaded directly into railcars. Our Piranha facility is capable of storing up to 400 railcars. We estimate an overall product yield (after mining and processing losses) of approximately 79% for the Piranha mine. John T.
The following table presents a summary of our mineral reserves for the Piranha mine as of December 31, 2023, together with a comparison to the reserves as of the end of the preceding fiscal year and an explanation of any material changes.
The following table presents a summary of our mineral reserves for the Piranha mine as of December 31, 2024, together with a comparison to the reserves as of the end of the preceding fiscal year and an explanation of any material changes.
As of December 31, 2023, the dry plant had a rated production capacity of 2.2 million tons per year. Our current air permit allows us to produce up to 2.2 million tons per year of finished product.
As of December 31, 2024, the dry plant had a rated production capacity of 2.2 million tons per year. Our current air permit allows us to produce up to 2.2 million tons per year of finished product.
Boyd utilized post December 31, 2017 production data we provided, along with the John T. Boyd January 2019 Report amending the resource tons as of December 31, 2017, to reconcile the amended estimate from the December 31, 2017 estimate to December 31, 2023.
Boyd utilized post December 31, 2017 production data we provided, along with the John T. Boyd January 2019 Report amending the resource tons as of December 31, 2017, to reconcile the amended estimate from the December 31, 2017 estimate to December 31, 2024.
Boyd has determined that all reportable mineral resources for the Piranha mine are categorized as proven reserves as the area is well explored and exhibit acceptable drill hole data spacing to be classified as a measured resource. The decrease from 2022 to 2023 is primarily attributed to depletion by mining 0.7 million tons of sand. Muskie.
Boyd has determined that all reportable mineral resources for the Piranha mine are categorized as proven reserves as the area is well explored and exhibit acceptable drill hole data spacing to be classified as a measured resource. The decrease from 2023 to 2024 is primarily attributed to depletion by mining 0.1 million tons of sand. Muskie.
The site contains a mine with 23.2 million tons of proven recoverable proppant sand reserves as of December 31, 2023, based on estimates prepared by John T. Boyd. Our Taylor wet plant can currently process up to 2.6 million tons of wet frac sand per year. Our Taylor dry plant is adjacent to our Taylor wet plant and wash facilities.
The site contains a mine with 22.6 million tons of proven recoverable proppant sand reserves as of December 31, 2024, based on estimates prepared by John T. Boyd. Our Taylor wet plant can currently process up to 2.6 million tons of wet frac sand per year. Our Taylor dry plant is adjacent to our Taylor wet plant and wash facilities.
Our Muskie facilities are located in Plum City, Wisconsin and encompass a total of approximately 40 acres. Although this plant is currently idled, our Muskie wet plant can process up to 1.3 million tons of wet sand per year.
Our Muskie facility is located in Plum City, Wisconsin and encompass a total of approximately 40 acres. Although this plant is currently idled, our Muskie wet plant can process up to 1.3 million tons of wet sand per year.
For information regarding our transloading facilities and shipping capabilities, see “Item 1. Business-Our Services-Natural Sand Proppant Services.” Our Wisconsin dry plants are enclosed facilities capable of running year-round, regardless of the weather. Under normal market conditions, we typically operate our plants with work crews of ten to 15 employees.
For information regarding our transloading facilities and shipping capabilities, see Item 1. “Business-Our Services-Natural Sand Proppant Services.” Our Wisconsin dry plants are enclosed facilities capable of running year-round, regardless of the weather. Under normal market conditions, we typically operate our plants with work crews of ten to 15 employees.
Boyd utilized post March 31, 2017 production data we provided, in conjunction with other data, to reconcile the estimate from the March 31, 2017 volumetric estimate to December 31, 2023.
Boyd utilized post March 31, 2017 production data we provided, in conjunction with other data, to reconcile the estimate from the March 31, 2017 volumetric estimate to December 31, 2024.
The decrease from 2022 to 2023 is primarily attributed to depletion by mining 0.6 million tons of sand. Piranha. Our Piranha operation is located approximately five miles northwest of the town of New Auburn, in Baron County, Wisconsin and encompasses a total of approximately 608 acres.
The decrease from 2023 to 2024 is primarily attributed to depletion by mining 0.5 million tons of sand. Piranha. Our Piranha operation is located approximately five miles northwest of the town of New Auburn, in Baron County, Wisconsin and encompasses a total of approximately 608 acres.
The total net book value of the Muskie operation’s real property and fixed assets as of December 31, 2023, was $5.2 million. Headquarters Our corporate headquarters are located at 14201 Caliber Drive, Suite 300, Oklahoma City, Oklahoma 73134.
The total net book value of the Muskie operation’s real property and fixed assets as of December 31, 2024, was $4.5 million. Headquarters Our corporate headquarters are located at 14201 Caliber Drive, Suite 300, Oklahoma City, Oklahoma 73134.
We acquired the Taylor operation in June 2017 when we acquired Sturgeon Acquisitions, LLC. The total net book value of the Taylor operation’s real property and fixed assets as of December 31, 2023, was $24.2 million.
We acquired the Taylor operation in June 2017 when we acquired Sturgeon Acquisitions, LLC. The total net book value of the Taylor operation’s real property and fixed assets as of December 31, 2024, was $22.2 million.
During the year ended December 31, 2023, our Taylor facility produced 0.6 million tons of finished sand product. Our finished product is transported via truck to our transloading facility with rail access. We estimate an overall product yield (after mining and processing losses) of approximately 66% for the Taylor mine. John T.
During the year ended December 31, 2024, our Taylor facility produced 0.5 million tons of finished sand product. Our finished product is transported via truck to our transloading facility with rail access. We estimate an overall product yield (after mining and processing losses) of approximately 73% for the Taylor mine. John T.
Boyd reviewed our financial cost and revenue per ton data at the time of the proven reserve determination. Our 2023 average monthly sales prices ranged from approximately $20 to $32 per ton free on board mine. Based on its review of our cost structure and its extensive experience with similar operations, John T.
Boyd reviewed our financial cost and revenue per ton data at the time of the proven reserve determination. Our 2024 average monthly sales prices ranged from approximately $19 to $26 per ton free on board mine. Based on its review of our cost structure and its extensive experience with similar operations, John T.
Our Piranha facility includes a 150 ton per hour natural 51 gas fired fluid bed dryer and a 200 ton per hour natural gas fluid bed dryer as well as seven high-capacity screeners capable of producing 2.6 million tons of frac sand per year. During the year ended December 31, 2023, our Piranha facility produced 0.7 million tons of sand.
Our Piranha facility includes a 150 ton per hour natural 50 gas fired fluid bed dryer and a 200 ton per hour natural gas fluid bed dryer as well as seven high-capacity screeners capable of producing 2.6 million tons of frac sand per year. During the year ended December 31, 2024, our Piranha facility produced 0.1 million tons of sand.
The total net book value of the Piranha operation’s real property and fixed assets as of December 31, 2023 was $13.4 million. The site contains 36.7 million tons of proven recoverable proppant sand reserves as of December 31, 2023, based on estimates prepared by John T. Boyd.
The total net book value of the Piranha operation’s real property and fixed assets as of December 31, 2024 was $12.3 million. The site contains 36.7 million tons of proven recoverable proppant sand reserves as of December 31, 2024, based on estimates prepared by John T. Boyd.
We currently own 12 properties, four located in Wisconsin, four located in Ohio, three located in Texas and one located in Oklahoma, which are used for field offices, yards, production plants or housing. In addition to our headquarters, we also lease 24 properties that are used for field offices, yards or transloading facilities for frac sand.
We currently own 9 properties, four located in Wisconsin, four located in Ohio and one located in Texas, which are used for field offices, yards, production plants or housing. In addition to our headquarters, we also lease 27 properties that are used for field offices, yards or transloading facilities for frac sand.
Piranha Mine – Summary of Reserves (1)(2) (Thousands of Tons) Amount as of Reserves Category December 31, 2023 December 31, 2022 Change % Change Proven 36,706 37,351 (645) (2) % 1. Pricing data based on the weighted average projected sales price for sand of $18.59 per ton. 2. John T.
Piranha Mine – Summary of Reserves (1)(2) (Thousands of Tons) Amount as of Reserves Category December 31, 2024 December 31, 2023 Change % Change Proven 36,650 36,706 (56) — % 1. Pricing data based on the weighted average projected sales price for sand of $18.59 per ton. 2. John T.
The following table presents a summary of our mineral reserves for the Taylor mine as of December 31, 2023, together with a comparison to the reserves as of the end of the preceding fiscal year and an explanation of any material changes. 50 Taylor Mine – Summary of Reserves (1)(2) (Thousands of Tons) Amount as of Reserves Category December 31, 2023 December 31, 2022 Change % Change Proven 23,191 23,822 (631) (3) % 1.
The following table presents a summary of our mineral reserves for the Taylor mine as of December 31, 2024, together with a comparison to the reserves as of the end of the preceding fiscal year and an explanation of any material changes. 49 Taylor Mine – Summary of Reserves (1)(2) (Thousands of Tons) Amount as of Reserves Category December 31, 2024 December 31, 2023 Change % Change Proven 22,633 23,191 (558) (2) % 1.
You are specifically cautioned not to assume that any part or all of the mineral deposits (including any mineral resources) in these categories will ever be converted into mineral reserves, as defined by the SEC. You are further cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value.
You are specifically cautioned not to assume that any part or all of the mineral deposits (including any mineral resources) in these categories will ever be converted into mineral reserves, as defined by the SEC.
The following table presents our estimated frac sand reserves for the Taylor and Piranha mines as of December 31, 2023 (amounts in thousands): Mine Reserves Category Total Reserves (1)(2) Taylor Proven 23,191 Piranha Proven 36,706 Total 59,897 1.
The following table presents our estimated frac sand reserves for the Taylor and Piranha mines as of December 31, 2024 (amounts in thousands): Mine Reserves Category Total Reserves (1)(2) Taylor Proven 22,633 Piranha Proven 36,650 Total 59,283 1.
Our natural sand proppant business mines, processes and sells high quality Northern White silica, a key input for the hydraulic fracturing of oil and gas wells, which we refer to as frac sand.
Reference should be made to the full text of the technical report summary, incorporated herein by reference and made a part of this annual report. Our natural sand proppant business mines, processes and sells high quality Northern White silica, a key input for the hydraulic fracturing of oil and gas wells, which we refer to as frac sand.
The following table provides information regarding our aggregate sand mined for December 31, 2023, 2022 and 2021: Total Sand Mined (Thousands of Tons) As of December 31, 2023 2022 2021 Plant Location Taylor in Jackson County, Wisconsin 608 630 567 Piranha in Barron County, Wisconsin 696 766 320 Total 1,304 1,396 887 Mineral Resources and Reserves The quantity and nature of our mineral resources and reserves are estimated by John T.
The following table provides information regarding our aggregate sand mined for December 31, 2024, 2023 and 2022: Total Sand Mined (Thousands of Tons) As of December 31, 2024 2023 2022 Plant Location Taylor in Jackson County, Wisconsin 492 608 630 Piranha in Barron County, Wisconsin (a) 53 696 766 Total 545 1,304 1,396 a.
Boyd, while we internally track depletion rate on an interim basis. Estimates of frac sand reserves for the Taylor mine and Piranha mine were derived contemporaneously with estimates of frac sand resources.
Decline in 2024 due to lower sales volumes. Mineral Resources and Reserves The quantity and nature of our mineral resources and reserves are estimated by John T. Boyd, while we internally track depletion rate on an interim basis. Estimates of frac sand reserves for the Taylor mine and Piranha mine were derived contemporaneously with estimates of frac sand resources.
The information that follows is derived, in part, from the technical report summary prepared by John T. Boyd Company in February 2022, our third-party mining and geological consultant and an external qualified person, (“John T. Boyd”), in compliance with Item 601(b)(96) and subpart 1300 of Regulation S-K. As of December 31, 2023, in the opinion of John T.
You are further cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. 44 The information that follows is derived, in part, from the technical report summary prepared by John T. Boyd Company in February 2022, our third-party mining and geological consultant and an external qualified person, (“John T.
Removed
Portions of the following information are based on assumptions, qualifications and procedures that are summarized here and are described in more detail in the technical report. Reference should be made to the full text of the technical report summary, incorporated herein by reference and made a part of this annual report.
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Boyd”), in compliance with Item 601(b)(96) and subpart 1300 of Regulation S-K. As of December 31, 2024, in the opinion of John T. Boyd, there were no material changes in mineral (frac sand) resources/mineral (frac sand) reserves, material assumptions or other technical information from those reported in the February 2022 technical report.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn the event that PREPA does not pay amounts owed to us for services performed, our financial condition, results of operations and cash flows would be materially and adversely affected. ” and “— The outcomes of investigations and litigation relating to our contracts with PREPA may have a material adverse effect on our financial condition, results of operations and cash flows .” In addition, due to the nature of our business, we are, from time to time, also involved in routine litigation or subject to disputes or claims related to our business activities, including workers’ compensation claims and employment related disputes. 52 Except as described in Note 20, Item 1A referenced above and elsewhere in this annual report, in the opinion of our management, none of the pending litigation, disputes or claims against us, if decided adversely, will have a material adverse effect on our business, financial condition, results of operations or cash flows.
Biggest changeIn addition, due to the nature of our business, we are, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities, including workers’ compensation claims and employment related disputes. Except as described in Note 20.
Item 3. Legal Proceedings We are a party to, or the subject of, certain investigations and legal proceedings discussed elsewhere in this annual report. For a description of such investigations and legal proceedings, see Note 20. Commitments and Contingencies to our consolidated financial statements included elsewhere in this annual report and Item 1A.
Item 3. Legal Proceedings We are a party to, or the subject of, certain investigations and legal proceedings discussed elsewhere in this annual report. For a description of such investigations and legal proceedings, see Note 20. “Commitments and Contingencies” to our consolidated financial statements included elsewhere in this annual report.
Removed
“Risk Factors—Risks Related to Our Business and the Industries We Serve— Cobra, one of our infrastructure services subsidiaries, was party to service contracts with PREPA. Due to PREPA’s bankruptcy proceedings, PREPA ’ s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
Added
“Commitments and Contingencies” to our consolidated financial statements included elsewhere in this annual report, and in Item 1A.
Added
“Risk Factors”, in the opinion of our management, none of the pending litigation, disputes or claims against us, if decided adversely, will have a material adverse effect on our business, financial condition, results of operations or cash flows. 51 MAMMOTH ENERGY SERVICES, INC.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeInformation concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 to this Report. 53 PART II. OTHER INFORMATION
Biggest changeInformation concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 to this Report. 52 PART II. OTHER INFORMATION

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders of Record Our common stock is traded on the Nasdaq Global Select Market under the symbol “TUSK.” As of the close of business on February 28, 2024, there were 83 holders of record of our common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders of Record Our common stock is traded on the Nasdaq Global Select Market under the symbol “TUSK.” As of the close of business on March 5, 2025, there were 97 holders of record of our common stock.
Based on its evaluation of these factors, the board of directors may determine not to declare a dividend, or declare dividends at rates that are less than currently anticipated. Item 6. [Reserved] 54
Based on its evaluation of these factors, the board of directors may determine not to declare a dividend, or declare dividends at rates that are less than currently anticipated. Item 6. [Reserved] 53
We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2023 or to date. See also Item 1.A.
We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2024 or to date. See also Item 1A.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeConsolidated Years Ended December 31, Reconciliation of net loss to Adjusted EBITDA: 2023 2022 2021 Net loss $ (3,163) $ (619) $ (101,430) Depreciation, depletion, amortization and accretion 45,110 64,271 78,475 Gains on disposal of assets, net (6,041) (3,908) (5,147) Impairment of goodwill 1,810 — 891 Impairment of other long-lived assets — — 1,212 Public offering costs — — 91 Stock based compensation 1,345 923 1,191 Interest expense and financing charges, net 16,196 11,506 6,406 Other income, net (42,015) (40,912) (5,154) Provision (benefit) for income taxes 12,297 13,607 (22,863) Interest on trade accounts receivable 45,440 41,276 34,709 Adjusted EBITDA $ 70,979 $ 86,144 $ (11,619) 63 Well Completion Services Years Ended December 31, Reconciliation of net (loss) income to Adjusted EBITDA: 2023 2022 2021 Net (loss) income $ (3,782) $ 10,194 $ (58,051) Depreciation, depletion, amortization and accretion 16,794 22,103 26,377 Gains on disposal of assets, net (2,091) (615) (770) Public offering costs — — 31 Stock based compensation 508 380 333 Interest expense and financing charges, net 4,502 1,940 1,107 Other expense (income), net 2 (343) 1,843 Interest on trade accounts receivable — — (1,841) Adjusted EBITDA $ 15,933 $ 33,659 $ (30,971) Infrastructure Services Years Ended December 31, Reconciliation of net income (loss) to Adjusted EBITDA: 2023 2022 2021 Net income (loss) $ 8,237 $ 4,933 $ (36,711) Depreciation, depletion, amortization and accretion 8,390 16,171 21,880 Gains on disposal of assets, net (510) (795) (286) Impairment of goodwill — — 891 Impairment of other long-lived assets — — 665 Public offering costs — — 39 Stock based compensation 538 349 500 Interest expense and financing charges, net 9,753 7,390 3,925 Other income, net (39,252) (40,470) (6,499) Provision for income taxes 11,214 13,427 712 Interest on trade accounts receivable 45,440 41,276 36,551 Adjusted EBITDA $ 43,810 $ 42,281 $ 21,667 Natural Sand Proppant Services Years Ended December 31, Reconciliation of net income (loss) to Adjusted EBITDA: 2023 2022 2021 Net income (loss) $ 906 $ (1,945) $ (6,328) Depreciation, depletion, amortization and accretion 7,737 8,732 9,005 Gains on disposal of assets, net (13) (89) (30) Public offering costs — — 12 Stock based compensation 187 119 202 Interest expense and financing charges, net 540 753 474 Other income, net (18) (14) (844) Interest on trade accounts receivable — — (1) Adjusted EBITDA $ 9,339 $ 7,556 $ 2,490 64 Drilling Services Years Ended December 31, Reconciliation of net loss to Adjusted EBITDA: 2023 2022 2021 Net loss $ (4,134) $ (6,071) $ (9,183) Depreciation, depletion, amortization and accretion 4,514 5,811 6,784 Gains on disposal of assets, net (1,577) — (205) Public offering costs — — 1 Stock based compensation 23 11 66 Interest expense and financing charges, net 489 435 237 Other (income) expense, net (33) — 25 Adjusted EBITDA $ (718) $ 186 $ (2,275) Other Services (a) Years Ended December 31, Reconciliation of net (loss) income to Adjusted EBITDA: 2023 2022 2021 Net (loss) income $ (4,390) $ (7,730) $ 8,843 Depreciation, depletion, amortization and accretion 7,675 11,454 14,429 Gains on disposal of assets, net (1,850) (2,409) (3,856) Impairment of goodwill 1,810 — — Impairment of other long-lived assets — — 547 Public offering costs — — 8 Stock based compensation 89 64 90 Interest expense and financing charges, net 912 988 663 Other (income) expense, net (2,714) (85) 321 Provision (benefit) for income taxes 1,083 180 (23,575) Interest on trade accounts receivable — — — Adjusted EBITDA $ 2,615 $ 2,462 $ (2,530) a.
Biggest changeConsolidated Years Ended December 31, Reconciliation of net loss to Adjusted EBITDA: 2024 2023 2022 Net loss $ (207,326) $ (3,163) $ (619) Depreciation, depletion, amortization and accretion 25,079 45,110 64,271 Gains on disposal of assets, net (4,014) (6,041) (3,908) Impairment of goodwill — 1,810 — Stock based compensation 875 1,345 923 Interest expense and financing charges, net 25,204 16,196 11,506 Other expense (income), net 64,621 (42,015) (40,912) (Benefit) provision for income taxes (11,204) 12,297 13,607 Interest on trade accounts receivable (60,686) 45,440 41,276 Adjusted EBITDA $ (167,451) $ 70,979 $ 86,144 62 Well Completion Services Years Ended December 31, Reconciliation of net (loss) income to Adjusted EBITDA: 2024 2023 2022 Net (loss) income $ (21,886) $ (2,043) $ 12,870 Depreciation, depletion, amortization and accretion 10,889 15,374 20,129 Loss (gains) on disposal of assets, net 52 (2,023) (618) Stock based compensation 180 496 369 Interest expense and financing charges, net 1,628 4,133 1,625 Other expense (income), net 2 2 (343) Adjusted EBITDA $ (9,135) $ 15,939 $ 34,032 Infrastructure Services Years Ended December 31, Reconciliation of net (loss) income to Adjusted EBITDA: 2024 2023 2022 Net (loss) income $ (166,089) $ 8,237 $ 4,933 Depreciation, depletion, amortization and accretion 2,774 8,390 16,171 Gains on disposal of assets, net (1,304) (510) (795) Stock based compensation 462 538 349 Interest expense and financing charges, net 21,590 9,753 7,390 Other expense (income), net 64,535 (39,252) (40,470) (Benefit) provision for income taxes (14,785) 11,214 13,427 Interest on trade accounts receivable (60,686) 45,440 41,276 Adjusted EBITDA $ (153,503) $ 43,810 $ 42,281 Natural Sand Proppant Services Years Ended December 31, Reconciliation of net (loss) income to Adjusted EBITDA: 2024 2023 2022 Net (loss) income $ (8,496) $ 1,824 $ (886) Depreciation, depletion, amortization and accretion 5,228 7,737 8,714 Loss (gains) on disposal of assets, net 1 (13) (89) Stock based compensation 145 186 118 Interest expense and financing charges, net 186 317 575 Other expense (income), net 8 (18) (14) Adjusted EBITDA $ (2,928) $ 10,033 $ 8,418 63 Other Services (a) Years Ended December 31, Reconciliation of net loss to Adjusted EBITDA: 2024 2023 2022 Net loss $ (10,855) $ (11,181) $ (17,536) Depreciation, depletion, amortization and accretion 6,188 13,609 19,257 Gains on disposal of assets, net (2,763) (3,495) (2,406) Impairment of goodwill — 1,810 — Stock based compensation 88 125 87 Interest expense and financing charges, net 1,800 1,993 1,916 Other expense (income), net 76 (2,747) (85) Provision for income taxes 3,581 1,083 180 Adjusted EBITDA $ (1,885) $ 1,197 $ 1,413 a.
As a result of the sale of ARS, we performed an impairment assessment of our goodwill for the Aviation reporting unit. We determined that the carrying value of goodwill for our Aviation reporting unit exceeded the fair value, resulting in impairment expense of $1.8 million for the year ended December 31, 2023.
As a result of the sale of ARS, we performed an impairment assessment of our goodwill for the Aviation reporting unit in 2023. We determined that the carrying value of goodwill for our Aviation reporting unit exceeded the fair value, resulting in impairment expense of $1.8 million for the year ended December 31, 2023.
New Revolving Credit Facility and New Term Credit Facility On October 16, 2023, we entered into the new revolving credit facility and the new term credit facility (each as defined below), which refinanced in full our indebtedness outstanding under, and terminated, the amended and restated revolving credit facility, dated as of October 19, 2018, as amended (the “previous revolving credit facility”), with us and certain of our direct and indirect subsidiaries, as borrowers, the lenders party thereto from time to time, and PNC Bank, National Association, as a lender and as administrative agent for the lenders.
Revolving Credit Facility and Term Credit Facility On October 16, 2023, we entered into a revolving credit facility and a term credit facility (each as defined below), which refinanced in full our indebtedness outstanding under, and terminated, the amended and restated revolving credit facility, dated as of October 19, 2018, as amended (the “previous revolving credit facility”), with us and certain of our direct and indirect subsidiaries, as borrowers, the lenders party thereto from time to time, and PNC Bank, National Association, as a lender and as administrative agent for the lenders.
Also, as noted above in this report, in response to market conditions we have (i) temporarily shut down certain of our oilfield service offerings, including coil tubing, pressure control, flowback, crude oil hauling, cementing, acidizing and land drilling services, (ii) idled certain facilities, including our sand processing plant in Pierce County, Wisconsin and (iii) reduced our workforce across all of our operations.
Also, as noted above in this report, in response to market conditions and reduced demand, we have (i) temporarily shut down certain of our oilfield service offerings, including coil tubing, pressure control, flowback, crude oil hauling, cementing, acidizing and land drilling services, (ii) idled certain facilities, including our sand processing plant in Pierce County, Wisconsin and (iii) reduced our workforce across all of our operations.
We exclude the items listed above from net (loss) income in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within our industries depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired.
We exclude the items listed above from net loss in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within our industries depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired.
On June 1, 2022, we entered into another agreement with FNC whereby we sold additional assets from our infrastructure segment to FNC for aggregate proceeds of $4.6 million and entered into a 42-month lease agreement whereby we lease back the assets at a monthly rental rate of $0.1 million.
On June 1, 2022, we entered into another agreement with FNC whereby we sold additional assets from our infrastructure segment to FNC for 68 aggregate proceeds of $4.6 million and entered into a 42-month lease agreement whereby we lease back the assets at a monthly rental rate of $0.1 million.
Our primary business objective is to grow our operations and create value for stockholders through organic growth opportunities and accretive acquisitions. Our suite of services includes well completion services, infrastructure services, natural sand proppant services, drilling services and other services. Our well completion services division provides hydraulic fracturing, sand hauling and water transfer services.
Our primary business objective is to grow our operations and create value for stockholders through organic growth opportunities and accretive acquisitions. Our suite of services includes well completion services, infrastructure services, natural sand proppant services and other services. Our well completion services division provides hydraulic fracturing, sand hauling and water transfer services.
Our primary sources of liquidity have been cash on hand, borrowings under our revolving credit facility and term credit facility and cash flows from operations, as well as the net proceeds received by Cobra under the assignment agreement with SPCP Group relating to the PREPA receivable.
Our primary sources of liquidity have been cash on hand, borrowings under our revolving credit facility and term credit facility and cash flows from operations, as well as the net proceeds received 64 by Cobra under the assignment agreement with SPCP Group relating to the PREPA receivable.
Interest under the new revolving credit facility equals the Tranche Rate (as defined in the new revolving credit facility) plus (i) 1.75%, if the Average Excess Availability Percentage (as defined in the new revolving credit facility) is greater than 66 2/3%, (ii) 2.00% if the Average Excess Availability Percentage is greater than 33 1/3% and less than or equal to 66 2/3%, and (iii) 2.25% if the Average Excess Availability Percentage is less than or equal to 33 1/3%.
Interest under the revolving credit facility equals the Tranche Rate (as defined in the revolving credit facility) plus (i) 1.75%, if the Average Excess Availability Percentage (as defined in the revolving credit facility) is greater than 66 2/3%, (ii) 2.00% if the Average Excess Availability Percentage is greater than 33 1/3% and less than or equal to 66 2/3%, and (iii) 2.25% if the Average Excess Availability Percentage is less than or equal to 33 1/3%.
Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net (loss) income or cash flows from operating activities as determined in accordance with GAAP or as an indicator of our operating performance or liquidity.
Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net loss or cash flows from operating activities as determined in accordance with GAAP or as an indicator of our operating performance or liquidity.
If we seek additional capital for any of the above or other reasons, we may do so through borrowings under a revolving credit facility, joint venture partnerships, sale-leaseback transactions, asset sales, including potential sales of accounts receivable, offerings of debt or equity securities or other means.
If we seek additional capital for any of the above or other reasons, we may do so through borrowings under the revolving credit facility, joint venture partnerships, sale-leaseback transactions, asset sales, including potential sales of accounts receivable or other financing transactions, offerings of debt or equity securities or other means.
Capital expenditures primarily for upgrades to our pressure pumping fleet to reduce greenhouse gas emissions and maintenance for the years ended December 31, 2023, 2022 and 2021. b. Capital expenditures primarily for truck, tooling and other equipment purchases for new infrastructure crews for the years ended December 31, 2023, 2022 and 2021. c.
Capital expenditures primarily for upgrades to our pressure pumping fleet to reduce greenhouse gas emissions and maintenance for the years ended December 31, 2024, 2023 and 2022. b. Capital expenditures primarily for truck, tooling and other equipment purchases for new infrastructure crews for the years ended December 31, 2024, 2023 and 2022. c.
As additional information becomes available, we reassess potential liabilities related to pending claims and litigation and may revise previous estimates, which could materially affect our results of operations in a given period. 74
As additional information becomes available, we reassess potential liabilities related to pending claims and litigation and may revise previous estimates, which could materially affect our results of operations in a given period. 72
We define Adjusted EBITDA as net (loss) income before depreciation, depletion, amortization and accretion, gains on disposal of assets, net, impairment of goodwill, impairment of other long-lived assets, public offering costs, stock based compensation, interest expense and financing charges, net, other income, net (which is comprised of interest on trade accounts receivable and certain legal expenses) and provision (benefit) for income taxes, further adjusted to add back interest on trade accounts receivable.
We define Adjusted EBITDA as net loss before depreciation, depletion, amortization and accretion, gains on disposal of assets, net, impairment of goodwill, stock based compensation, interest expense and financing charges, net, other expense (income), net (which is comprised of interest on trade accounts receivable and certain legal expenses) and (benefit) provision for income taxes, further adjusted to add back interest on trade accounts receivable.
Net working capital (less cash and current portion of long-term debt) is a non-GAAP measure and, as of December 31, 2023, is calculated by subtracting total current liabilities of $182.6 million and cash and cash equivalents of $16.6 million from total current assets of $496.9 million.
As of December 31, 2023, net working capital (less cash and current portion of long-term debt) is calculated by subtracting total current liabilities of $182.6 million and cash and cash equivalents of $16.6 million from total current assets of $496.9 million.
Effect of Foreign Exchange Rate on Cash The effect of foreign exchange rate on cash was a nominal amount for the year ended December 31, 2023, ($0.2) million for the year ended December 31, 2022, and was a nominal amount for the year ended December 31, 2021.
Effect of Foreign Exchange Rate on Cash The effect of foreign exchange rate on cash was a ($0.1) million for the year ended December 31, 2024, a nominal amount for the year ended December 31, 2023, and ($0.2) million for the year ended December 31, 2022.
In particular, under the new term credit facility, we are required, among other things, to mandatorily remit to Wexford up to 50% of all amounts that constitute PREPA Claim Proceeds, as such term is defined in the new term credit facility, which will be used to reduce outstanding borrowings under the new term credit facility, as required under the terms thereof.
In particular, under the term credit facility, we were required, among other things, to mandatorily remit to Wexford up to 50% of all amounts that constitute PREPA Claim Proceeds, as such term is defined in the term credit facility, which were used to reduce outstanding borrowings under the term credit facility, as required under the terms thereof.
Interest under the new term credit facility equals the SOFR Interest Rate (as defined in the new term credit facility) plus 7.50%, as such margin may be increased pursuant to the terms of the new term credit facility; provided that we may elect to pay all or a portion of the accrued interest due with respect to any Interest Period (as defined in the new term credit facility) ending on or before April 16, 2025, in kind by adding such accrued interest to the principal amount of the outstanding loans thereunder.
Interest under the term credit facility equaled the SOFR Interest Rate (as defined in the term credit facility) plus 7.50%; provided that we may elect to pay all or a portion of the accrued interest due with respect to any Interest Period (as defined in the new term credit facility) ending on or before April 16, 2025, in kind by adding such accrued interest to the principal amount of the outstanding loans thereunder.
On October 16, 2023, we, as borrower, and certain of our direct and indirect subsidiaries, as guarantors, entered into a revolving credit agreement with the lenders party thereto and Fifth Third Bank, National Association, as a lender and as 68 administrative agent for the lenders (“Fifth Third”), as may be subsequently amended (the “new revolving credit facility”).
On October 16, 2023, we, as borrower, and certain of our direct and indirect subsidiaries, as guarantors, entered into a revolving credit agreement with the lenders party thereto and Fifth Third Bank, National Association, as a lender and as 66 administrative agent for the lenders (“Fifth Third Bank”), as may be subsequently amended (the “revolving credit facility”).
Management believes these measures provide meaningful information about the Company’s performance by excluding certain non-cash charges, such as impairment of goodwill and impairment of other long-lived assets, that may not be indicative of the Company’s ongoing operating results, from net loss.
Management believes these measures provide meaningful information about the Company’s performance by excluding certain non-cash charges, such as impairment of goodwill, that may not be indicative of the Company’s ongoing operating results, from net loss.
The year-over-year effect was driven primarily by a favorable (unfavorable) shift in the weakness (strength) of the Canadian dollar relative to the U.S. dollar for the cash held in Canadian accounts. Working Capital Our working capital totaled $314.4 million and $259.5 million, respectively, at December 31, 2023 and 2022.
The year-over-year effect was driven primarily by a favorable (unfavorable) shift in the weakness (strength) of the Canadian dollar relative to the U.S. dollar for the cash held in Canadian accounts. Working Capital Our working capital totaled $74.1 million and $314.4 million, respectively, at December 31, 2024 and 2023.
The change in operating cash flows from 2022 to 2023 was primarily due to increased receipts on accounts receivable, including the receipt of $22.2 million from PREPA, which was partially offset by an increase in payments on accounts payable and other liabilities as well as a decline in depreciation expense.
The change in operating cash flows from 2022 to 2023 was primarily due to increased receipts on accounts receivable, including the receipt of $22.2 million from PREPA, which was partially offset by an increase in payments on accounts payable and other liabilities.
As discussed above, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion 57 activities and adversely impacted demand for our sand proppant services in the second half of 2023.
As discussed above, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities and adversely impacted demand for our sand proppant services in the second half of 2023. Activity remained suppressed throughout 2024.
Gains on the disposal of assets is primarily related to the sale of a drilling rig, trucks, and field equipment for the years ended December 31, 2023 and trucks, land and buildings for the year ended December 31, 2022. Impairment of Goodwill .
Gains on the disposal of assets is primarily related to the sale of dormitories, trucks, and field equipment for the years ended December 31, 2024 and a drilling rig, trucks, and field equipment for the year ended December 31, 2023. Impairment of Goodwill .
In response to market conditions, we temporarily shut down our cementing and acidizing operations and flowback operations beginning in July 2019, our contract drilling operations beginning in December 2019, our rig hauling operations beginning in April 2020, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
In response to market conditions and reduced demand, we idled our cementing and acidizing operations and flowback operations beginning in July 2019, our contract drilling operations beginning in December 2019, our rig hauling operations beginning in April 2020, our coil tubing, pressure control and full service transportation operations beginning in July 2020 and our crude oil hauling operations beginning in July 2021.
For a discussion of the results of operations for the year ended December 31, 2022 as compared to the year ended December 31, 2021, please refer to “Part II, Item 7.
For a discussion of the results of operations for the year ended December 31, 2023 as compared to the year ended December 31, 2022, please refer to Part II, Item 7.
We did not recognize any impairment of goodwill in 2022. Operating Loss. We reported an operating loss of $16.7 million for 2023 compared to $16.4 million for 2022.
We did not recognize any impairment of goodwill in 2024. Operating Loss. We reported an operating loss of $128.7 million for 2024 compared to $16.7 million for 2023.
The increase as a percentage of revenue is primarily due to a decrease in utilization of our pressure pumping services, resulting in a higher ratio of fixed costs to variable costs. Infrastructure Services. Infrastructure services division cost of revenue, exclusive of depreciation and amortization expense, decreased $1.0 million from $91.6 million for 2022 to $90.6 million for 2023.
The increase as a percentage of revenue is primarily due to a decrease in utilization of our pressure pumping services, resulting in a higher ratio of fixed costs to variable costs. Infrastructure Services. Infrastructure services division cost of revenue, exclusive of depreciation and amortization expense, increased $1.5 million from $90.6 million for 2023 to $92.1 million for 2024.
We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2023 or to date. See also Item 1.A.
We have not repurchased any shares of our common stock under the stock repurchase program as of December 31, 2024 or to date. See also Item 1A.
Inspections LLC—January 2015 • Mammoth Equipment Leasing LLC—November 2016 • Bison Sand Logistics LLC—January 2018 • Aquahawk Energy LLC—June 2018 Infrastructure Services Segment • Cobra Acquisitions LLC, or Cobra—January 2017 • Lion Power Services LLC, formerly Cobra Energy LLC—January 2017 • Higher Power Electrical LLC—April 2017 • 5 Star Electric LLC—July 2017 • Python Equipment LLC—December 2018 • Aquawolf LLC—September 2019 • Falcon Fiber Solutions LLC—May 2021 55 Natural Sand Proppant Services Segment • Muskie Proppant LLC—September 2011 • Barracuda Logistics LLC—October 2014 • Piranha Proppant LLC—May 2017 • Sturgeon Acquisitions LLC—June 2017 • Taylor Frac, LLC—June 2017 • Taylor Real Estate Investments, LLC—June 2017 • South River Road, LLC—June 2017 Drilling Services Segment • Bison Drilling and Field Services, LLC—November 2010 • Panther Drilling Systems LLC—December 2012 Other • Great White Sand Tiger Lodging Ltd.—October 2007 • Redback Energy Services, LLC—October 2011 • Redback Coil Tubing, LLC—May 2012 • Bison Trucking—August 2013 • Anaconda Rentals LLC, formerly White Wing Tubular Services LLC—September 2014 • WTL Oil LLC, or WTL, formerly Silverback—June 2016 • Mammoth Energy Services Inc.—June 2016 • Mammoth Energy Partners, LLC—October 2016 • Mako Acquisitions LLC—March 2017 • Stingray Energy Services LLC, or Stingray Energy Services—June 2017 • Stingray Cementing LLC—June 2017 • Tiger Shark Logistics LLC—October 2017 • Cobra Aviation Services LLC—January 2018 • Black Mamba Energy LLC—March 2018 • Stingray Cementing and Acidizing LLC, formerly RTS Energy Services LLC—June 2018 • Ivory Freight Solutions LLC—July 2018 • IFX Transport LLC—December 2018 • Air Rescue Systems LLC (“ARS”)—December 2018 through July 13, 2023 • Leopard Aviation LLC—April 2019 • Anaconda Manufacturing LLC—September 2019 On July 13, 2023, the Company sold its equity interests in ARS.
Inspections LLC—January 2015 • Mammoth Equipment Leasing LLC—November 2016 Infrastructure Services Segment • Cobra Acquisitions LLC, or Cobra—January 2017 • Lion Power Services LLC, formerly Cobra Energy LLC—January 2017 • Higher Power Electrical LLC—April 2017 • 5 Star Electric LLC—July 2017 • Python Equipment LLC—December 2018 54 • Aquawolf LLC—September 2019 • Falcon Fiber Solutions LLC—May 2021 Natural Sand Proppant Services Segment • Muskie Proppant LLC—September 2011 • Piranha Proppant LLC—May 2017 • Sturgeon Acquisitions LLC—June 2017 • Taylor Frac, LLC—June 2017 • Taylor Real Estate Investments, LLC—June 2017 • South River Road, LLC—June 2017 Other • Great White Sand Tiger Lodging Ltd.—October 2007 • Bison Drilling and Field Services, LLC—November 2010 • Panther Drilling Systems LLC—December 2012 • Bison Trucking—August 2013 • Mammoth Energy Services Inc.—June 2016 • Mammoth Energy Partners, LLC—October 2016 • Mako Acquisitions LLC—March 2017 • Stingray Energy Services LLC, or Stingray Energy Services—June 2017 • Tiger Shark Logistics LLC—October 2017 • Cobra Aviation Services LLC—January 2018 • Dire Wolf Energy Services LLC—January 2018 • Black Mamba Energy LLC—March 2018 • Stingray Cementing and Acidizing LLC, formerly RTS Energy Services LLC—June 2018 • Air Rescue Systems LLC (“ARS”)—December 2018 through July 13, 2023 • Leopard Aviation LLC—April 2019 • Predator Aviation LLC—April 2019 • Anaconda Manufacturing LLC—September 2019 • Orca Energy Services LLC—December 2024 On July 13, 2023, the Company sold its equity interests in ARS.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022 (filed with the SEC on February 24, 2023), which is incorporated in this report by reference from such prior report on Form 10-K.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023 (filed with the SEC on March 1, 2024), which is incorporated in this report by reference from such prior report on Form 10-K.
The increased operating loss in 2023 was primarily due to reduced utilization across our well completions and natural sand proppant divisions, partially offset by a decline in depreciation, depletion, amortization and accretion expense. Interest Expense and financing charges, net .
The increased loss was coupled with reduced utilization across our well completions and natural sand proppant divisions, and partially offset by a decline in depreciation, depletion, amortization and accretion expense. Interest Expense and financing charges, net .
On average, 178 rooms were utilized per night during 2023, a 3% increase from an average of 172 rooms utilized per night in 2022. Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion expense) .
On average, 216 rooms were utilized per night during 2024, a 21% increase from an average of 178 rooms utilized per night in 2023. Cost of Revenue (exclusive of depreciation, depletion, amortization and accretion expense) .
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services. These factors have continued into the first quarter of 2024.
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services.
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion expense, decreased $30.8 million from $278.6 million, or 77% of total revenue, for 2022 to $247.8 million, or 80% of total revenue, for 2023. Cost of revenue by operating division was as follows: Well Completion Services .
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion expense, decreased $77.0 million from $247.8 million, or 80% of total revenue, for 2023 to $170.8 million, or 91% of total revenue, for 2024. Cost of revenue by operating division was as follows: Well Completion Services .
Demand for our natural sand proppant was adversely impacted in the second quarter of 2023 by the wildfires in Canada, which hindered our ability to transport sand. Notwithstanding the foregoing, our sand business remained resilient during the second quarter of 2023.
Demand for our natural sand proppant was adversely impacted in the second quarter of 2023 by the wildfires in Canada, which hindered our ability to transport sand.
Our revenues, operating (loss) income and identifiable assets are primarily attributable to four reportable segments: well completion services; infrastructure services; natural sand proppant services; and drilling services. Prior to 2023, we included Bison Trucking LLC, or Bison Trucking, in our drilling segment.
Our revenues, operating (loss) income and identifiable assets are primarily attributable to three reportable segments: well completion services; infrastructure services; and natural sand proppant services. Prior to 2024, we included Bison Drilling and Field Services, LLC, or Bison Drilling, and Panther Drilling Systems LLC, or Panther, in our drilling reportable segment.
See Note 7 to our consolidated financial statements for details regarding the facts and circumstances that led to this impairment and how the fair value of each reporting unit was estimated, including significant assumptions used and other details. Other Long-Lived Assets.
“Impairments” to our consolidated financial statements included elsewhere in this annual report for details regarding the facts and circumstances that led to this impairment and how the fair value of each reporting unit was estimated, including significant assumptions used and other details. Other Long-Lived Assets.
Infrastructure services division revenue decreased $1.0 million, or 1%, to $110.5 million for 2023 from $111.5 million for 2022 primarily due to a decline in average crew count from 91 crews during the year ended December 31, 2022 to an average of 83 crews during the year ended December 31, 2023.
Infrastructure services division revenue decreased marginally by $0.1 million to $110.4 million for 2024 from $110.5 million for 2023 primarily due to a decline in average crew count from 83 crews during the year ended December 31, 2023 to an average of 79 crews during the year ended December 31, 2024.
Activity for ARS through the date of sale is included in the accompanying results of operations. 2023 Financial Overview and Highlights • Net loss of $3.2 million, or $0.07 per diluted share, for the year ended December 31, 2023 as compared to net loss of $0.6 million, or $0.01 per diluted share, for the year ended December 31, 2022. • Adjusted EBITDA of $71.0 million for the year ended December 31, 2023 as compared to $86.1 million for the year ended December 31, 2022.
Activity for ARS through the date of sale is included in the accompanying results of operations. 2024 Financial Overview and Highlights • Net loss of $207.3 million, or $4.31 per diluted share, for the year ended December 31, 2024 as compared to net loss of $3.2 million, or $0.07 per diluted share, for the year ended December 31, 2023.
We believe that our cash on hand, operating cash flow and available borrowings under our credit facility and term loan facility will be sufficient to meet our short-term and long-term funding requirements, including funding our current operations, planned capital expenditures, debt service obligations and known contingencies.
We believe that our cash on hand, including the cash payments received to date under the Settlement Agreement with PREPA, operating cash flow and available borrowings under our currently undrawn credit facility will be sufficient to meet our short-term and long-term funding requirements, including funding our current operations, planned capital expenditures, debt service obligations and known contingencies.
Revenue for 2023 decreased $52.6 million, or 15%, to $309.5 million from $362.1 million for 2022. The decline in total revenue is primarily attributable to a decrease in utilization in our well completion services division as well as a decline in tons sold in our natural sand proppant services division.
Revenue for 2024 decreased $121.6 million, or 39%, to $187.9 million from $309.5 million for 2023. The decline in total revenue is primarily attributable to a decrease in utilization in our well completion services division as well as a decline in tons sold in our natural sand proppant services division.
On October 16, 2023, we, as borrower, and certain of our direct and indirect subsidiaries, as guarantors, also entered into a loan and security agreement with the lenders party thereto and Wexford Capital LP, an affiliate of the Company, as administrative agent for the lenders “Wexford”), as may be subsequently amended (the “new term credit facility”).
On October 16, 2023, we, as borrower, and certain of our direct and indirect subsidiaries, as guarantors, also entered into a loan and security agreement with the lenders party thereto and Wexford Capital LP, an affiliate of the Company (the “term credit facility”).
Liquidity and Cash Flows The following table sets forth our cash flows for the years indicated (in thousands): Years Ended December 31, 2023 2022 2021 Net cash provided by (used in) operating activities $ 31,386 $ 15,266 $ (18,865) Net cash (used in) provided by investing activities (8,786) (2,124) 5,507 Net cash (used in) provided by financing activities (15,586) (5,601) 8,428 Effect of foreign exchange rate on cash 2 (158) 7 Net change in cash $ 7,016 $ 7,383 $ (4,923) Operating Activities Net cash provided by (used in) operating activities was $31.4 million, $15.3 million and ($18.9) million, respectively, for the years ended December 31, 2023, 2022 and 2021.
Liquidity and Cash Flows The following table sets forth our cash flows for the years indicated (in thousands): Years Ended December 31, 2024 2023 2022 Net cash provided by operating activities $ 180,717 $ 31,386 $ 15,266 Net cash used in investing activities (10,432) (8,786) (2,124) Net cash used in financing activities (112,113) (15,586) (5,601) Effect of foreign exchange rate on cash (144) 2 (158) Net change in cash $ 58,028 $ 7,016 $ 7,383 Operating Activities Net cash provided by operating activities was $180.7 million, $31.4 million and $15.3 million, respectively, for the years ended December 31, 2024, 2023 and 2022.
Litigation and Contingencies As discussed in Note 20 of our consolidated financial statements, we are involved in various litigation matters arising in the ordinary course of business. Accruals for litigation and contingencies are based on our assessment, including advice of legal counsel, of the expected outcome of litigation or other dispute resolution proceedings and/or the expected resolution of contingencies.
“Commitments and Contingencies” to our consolidated financial statements included elsewhere in this annual report, we are involved in various litigation matters arising in the ordinary course of business. Accruals for litigation and contingencies are based on our assessment, including advice of legal counsel, of the expected outcome of litigation or other dispute resolution proceedings and/or the expected resolution of contingencies.
The new term credit facility was approved by the audit committee of our board of directors, consisting entirely of independent directors, as a transaction with a related party. The new term credit facility provides for term commitments in an aggregate amount equal to $45 million.
The term credit facility was approved by the audit committee of our board of directors, consisting entirely of independent directors, as a transaction with a related party. The term credit facility provided for term commitments in an aggregate amount equal to $45 million. Borrowings under the term credit facility were secured by our assets, inclusive of the subsidiary companies.
Our corporate related activities do not generate revenue. 65 Adjusted Net Loss and Adjusted Loss per Share Adjusted net loss and adjusted basic and diluted loss per share are supplemental non-GAAP financial measures that are used by management to evaluate our operating and financial performance.
Adjusted Net Loss and Adjusted Loss per Share Adjusted net loss and adjusted basic and diluted loss per share are supplemental non-GAAP financial measures that are used by management to evaluate our operating and financial performance.
Under the agreements, we have the option to purchase the assets at the end of the lease term. We recorded a liability for the proceeds received and will continue to depreciate the assets.
Under the agreements, we have the option to purchase the assets at the end of the lease term, which caused us to fail true sale treatment. As a result, we recorded a liability for the proceeds received and will continue to depreciate the assets.
Financing Activities Net cash (used in) provided by financing activities was ($15.6) million, ($5.6) million and $8.4 million, respectively, for the years ended December 31, 2023, 2022 and 2021.
Financing Activities Net cash used in financing activities was $112.1 million, $15.6 million and $5.6 million, respectively, for the years ended December 31, 2024, 2023 and 2022.
This could result in the recognition of future material impairment charges on the same, or additional, property and equipment if future cash flow estimates, based upon information then available to management, indicate that their carrying values are not recoverable.
This could result in the recognition of future material impairment charges if future cash flow estimates, based upon information then available to management, indicate that their carrying values are not recoverable. Litigation and Contingencies As discussed in Note 20.
Further, under the term loan and security agreement with Wexford, Mammoth is required, among other things, to mandatorily remit to Wexford up to 50% of all amounts that constitute PREPA Claim proceeds, to reduce outstanding borrowings under such term loan and security agreement. In connection with the Assignment Agreement, Wexford waived this requirement until the Assignment Agreement is terminated.
Further, under the term loan and security agreement with Wexford, Mammoth was required, among other things, to mandatorily remit to Wexford up to 50% of all amounts that constitute PREPA Claim proceeds, including the proceeds received by Cobra under the Assignment Agreement, to reduce outstanding borrowings under such term loan and security agreement.
The lenders, as applicable, (i) would not be required to lend any additional amounts to us under the new revolving credit facility, (ii) could elect to increase the interest rate by (x) 200 basis points in connection with an event of default under the new revolving credit facility or (y) 300 basis points with respect to an event of default under the new term credit facility, (iii) could elect to declare all outstanding borrowings, together with accrued and unpaid interest and fees, to be due and payable, (iv) may have the ability to require us to apply all of our available cash to repay outstanding borrowings, and (v) may foreclose on substantially all of our assets.
The lenders, as applicable, (i) would not be required to lend any additional amounts to the Company, (ii) could elect to increase the interest rate by 200 basis points, (iii) could elect to declare all outstanding borrowings, together with accrued and unpaid interest and fees, to be due and payable, (iv) may have the ability to require the Company to apply all of its available cash to repay outstanding borrowings, and (v) may 67 foreclose on substantially all of the Company’s assets.
Includes results for our aviation, equipment rentals, remote accommodations and equipment manufacturing and corporate related activities.
Includes results for our directional drilling, aviation, equipment rentals, remote accommodations and equipment manufacturing and corporate related activities. Our corporate related activities do not generate revenue.
Concurrent with the sale of assets, we entered into a 36-month lease agreement whereby we will lease back the assets at a monthly rental rate of $0.1 million.
Concurrent with the sale of assets, we entered into a 36-month lease agreement whereby we lease back the assets at a monthly rental rate of $0.1 million. On December 30, 2023, this lease was extended 12 months.
We also provide storm repair and restoration services in response to storms and other disasters. We provide infrastructure services primarily in the northeastern, southwestern, midwestern and western portions of the United States. We currently have agreements in place with private utilities, public IOUs and Co-Ops.
We also provide storm repair and restoration services in response to storms and other disasters. We provide infrastructure services primarily in the northeastern, southwestern, midwestern and western portions of the United States.
This was partially offset by an increase in storm restoration activity of $4.5 million during the year ended December 31, 2023 compared to the year ended December 31, 2022. Natural Sand Proppant Services. Natural sand proppant services division revenue decreased $12.3 million, or 24%, to $39.1 million for 2023, from $51.4 million for 2022.
This was offset by an increase in storm, transmission and engineering activity of $4.7 million during the year ended December 31, 2024 compared to the year ended December 31, 2023. Natural Sand Proppant Services. Natural sand proppant services division revenue decreased $20.0 million, or 51%, to $19.1 million for 2024, from $39.1 million for 2023.
See Note 2 to our consolidated financial statements for additional detail regarding our allowance for expected credit losses. Valuation of Long-Lived Assets Long-lived assets on our balance sheet include property, plant and equipment, goodwill and intangible assets. We test goodwill for impairment annually, or more frequently if events or changes in circumstances indicate that an impairment may 73 exist.
Valuation of Long-Lived Assets Long-lived assets on our balance sheet include property, plant and equipment, goodwill and intangible assets. We test goodwill for impairment annually, or more frequently if events or changes in circumstances indicate that an impairment may exist.
Cash (used in) provided by investing activities is primarily comprised of purchases of property and equipment and proceeds from the disposal of property and equipment and business divestitures. 67 The following table summarizes our capital expenditures by operating division for the periods indicated (in thousands): Years Ended December 31, 2023 2022 2021 Well completion services (a) $ 17,931 $ 11,421 $ 4,327 Infrastructure services (b) 716 885 627 Natural sand proppant services (c) 223 88 484 Drilling services (c) 110 95 23 Other (d) 312 401 382 Eliminations 103 (153) — Total capital expenditures $ 19,395 $ 12,737 $ 5,843 a.
Cash used in investing activities is primarily comprised of purchases of property and equipment and proceeds from the disposal of property and equipment and business divestitures. 65 The following table summarizes our capital expenditures by operating division for the periods indicated (in thousands): Years Ended December 31, 2024 2023 2022 Well completion services (a) $ 12,730 $ 17,921 $ 11,421 Infrastructure services (b) 2,815 716 885 Natural sand proppant services (c) — 223 88 Other (d) 913 432 496 Eliminations (e) 607 103 (153) Total capital expenditures $ 17,065 $ 19,395 $ 12,737 a.
See Note 14 to our consolidated financial statements for additional detail regarding our change in tax expense. Non-GAAP Financial Measures Adjusted EBITDA Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies.
Non-GAAP Financial Measures Adjusted EBITDA Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies.
A continued period of low oil and natural gas prices or continued reductions in capital expenditures by our customers would likely have an adverse impact on our utilization and the prices that we receive for our services.
The assumptions used in the impairment evaluation for goodwill and other long-lived assets are inherently uncertain and require management’s judgment. A continued period of low oil and natural gas prices or continued reductions in capital expenditures by our customers would likely have an adverse impact on our utilization and the prices that we receive for our services.
The decrease is primarily due to a decline in property and equipment depreciation expense as a result of lower capital expenditures and existing assets being fully depreciated or impaired. Gains on Disposal of Assets, Net. Gains on the disposal of assets increased $2.1 million, or 54%, to $6.0 million for 2023 from $3.9 million in 2022.
Depreciation, depletion, amortization and accretion decreased $20.0 million, or 44%, to $25.1 million for 2024 from $45.1 million in 2023. The decrease is primarily due to a decline in property and equipment depreciation expense as a result of lower capital expenditures and existing assets being fully depreciated. Gains on Disposal of Assets, Net.
During the years ended December 31, 2023, and 2021, we recorded goodwill impairment charges of $1.8 million and $0.9 million, respectively. We did not recognize any impairment of goodwill for the year ended December 31, 2022.
During the year ended December 31, 2023, we recorded a goodwill impairment charge of $1.8 million. We did not recognize any impairment of goodwill for the years ended December 31, 2024 and 2022. See Note 7.
Borrowings under the new revolving credit facility are secured by our assets, inclusive of the subsidiary companies, and are subject to a borrowing base calculation prepared monthly which includes a requirement to maintain certain reserves as specified in the new revolving credit facility. The new revolving credit facility also contains various affirmative and restrictive covenants.
The revolving credit facility provides for revolving commitments in an aggregate amount of up to $75 million. Borrowings under the revolving credit facility are secured by our assets, inclusive of the subsidiary companies, and are subject to a borrowing base calculation prepared monthly which includes a requirement to maintain certain reserves as specified in the revolving credit facility.
Years Ended December 31, 2023 2022 2021 (in thousands, except per share amounts) Net loss, as reported $ (3,163) $ (619) $ (101,430) Impairment of goodwill 1,810 — 891 Impairment of other long-lived assets — — 1,212 Adjusted net loss $ (1,353) $ (619) $ (99,327) Basic loss per share, as reported $ (0.07) $ (0.01) $ (2.18) Impairment of goodwill 0.04 — 0.02 Impairment of other long-lived assets — — 0.03 Adjusted basic loss per share $ (0.03) $ (0.01) $ (2.13) Diluted loss per share, as reported $ (0.07) $ (0.01) $ (2.18) Impairment of goodwill 0.04 — 0.02 Impairment of other long-lived assets — — 0.03 Adjusted diluted loss per share $ (0.03) $ (0.01) $ (2.13) Liquidity and Capital Resources We require capital to fund ongoing operations including maintenance expenditures on our existing fleet of equipment, organic growth initiatives, investments and acquisitions, and the litigation settlement obligations described in Note 20 “Commitments and Contingencies” of the Notes to the Consolidated Financial Statements and under “Capital Requirements and Sources of Liquidity” below.
Years Ended December 31, 2024 2023 2022 (in thousands, except per share amounts) Net loss, as reported $ (207,326) $ (3,163) $ (619) Impairment of goodwill — 1,810 — Adjusted net loss $ (207,326) $ (1,353) $ (619) Basic loss per share, as reported $ (4.31) $ (0.07) $ (0.01) Impairment of goodwill — 0.04 — Adjusted basic loss per share $ (4.31) $ (0.03) $ (0.01) Diluted loss per share, as reported $ (4.31) $ (0.07) $ (0.01) Impairment of goodwill — 0.04 — Adjusted diluted loss per share $ (4.31) $ (0.03) $ (0.01) Liquidity and Capital Resources We require capital to fund ongoing operations including maintenance expenditures on our existing fleet of equipment, organic growth initiatives, investments and acquisitions, and the litigation settlement obligations described in Note 20.
On May 26, 2018, Cobra and PREPA entered into a second one-year master services agreement, which provided for payments of up to $900 million, to provide additional repair services and begin the initial phase of reconstruction of the electrical power system in Puerto Rico (the “second contract”).
On May 26, 2018, Cobra and PREPA entered into a second one-year, $900 million master services agreement to provide additional repair services and begin the initial phase of reconstruction of the electrical power system in Puerto Rico. Our work under each of the contracts with PREPA ended on March 31, 2019.
During 2023, we recorded income tax expense of $12.3 million on pre-tax income of $9.1 million compared to income tax expense of $13.6 million on pre-tax income of $13.0 million for 2022. Our effective tax rate was 134.6% for 2023 compared to 104.8% for 2022.
During 2024, we recorded income tax benefit of $11.2 million on pre-tax loss of $218.5 million compared to income tax expense of $12.3 million on pre-tax income of $9.1 million for 2023. Our effective tax rate was 5.1% for 2024 compared to 134.6% for 2023.
Our unrestricted cash balances totaled $16.6 million and $17.3 million, respectively, at December 31, 2023 and 2022. Included in working capital are receivables due from PREPA totaling $402.3 million and $379.0 million and corresponding liabilities of $60.6 million and $47.6 million at December 31, 2023 and 2022, respectively.
Our unrestricted cash balances totaled $61.0 million and $16.6 million, respectively, at December 31, 2024 and 2023. Included in working capital are receivables due from PREPA totaling $20.0 million and $402.3 million and tax liabilities related to our work in Puerto Rico of $43.3 million and $60.6 million at December 31, 2024 and 2023, respectively.
During 2023, our capital expenditures totaled $19.4 million, including $17.9 million in our well completion segment primarily related to upgrades to our pressure pumping fleet, $0.7 million in our infrastructure segment primarily related to truck, tooling and equipment purchases for new crews, $0.2 million in our natural sand proppant services segment for equipment maintenance and $0.6 million for our other divisions primarily related to equipment additions for our remote accommodations and equipment rental businesses.
During the year ended December 31, 2024, our capital expenditures totaled $17.1 million, including $12.7 million in our well completion segment primarily related to upgrades to our pressure pumping fleet, $2.8 million in our infrastructure segment primarily related to truck, tooling and equipment purchases for new crews and $1.6 million for our other divisions primarily related to equipment additions for our remote accommodations and equipment rental businesses.
If such evaluations indicate that the future undiscounted cash flow from the assets is not sufficient to recover the carrying value of such assets, the assets are adjusted to their estimated fair values. During the year ended December 31, 2021, we recorded impairment charges of other long-lived assets totaling $1.2 million.
If such evaluations indicate that the future undiscounted cash flow from the assets is not sufficient to recover the carrying value of such assets, the assets are adjusted to their estimated fair values. We did not recognize any impairment of other long-lived assets for the years ended December 31, 2024, 2023 or 2022.
This note was secured by the seven pressure pumping units and bore interest at an imputed rate of approximately 15.0%. This equipment note was paid off on December 22, 2023.
Under this arrangement, we agreed to make monthly principal and interest payments totaling $0.3 million over the term of the agreement. This note was secured by the seven pressure pumping units and bore interest at an imputed rate of approximately 15.0%. This equipment note was paid off on December 22, 2023.
The net proceeds received by Cobra in connection with the Assignment Agreement were $46.1 million. Subsequent to December 31, 2023, PREPA paid $64.0 million with respect to the outstanding PREPA receivable.
In connection with the Assignment Agreement, Wexford waived this requirement. The net proceeds received by Cobra in connection with the Assignment Agreement were $46.1 million. During the three months ended March 31, 2024, PREPA paid $64.0 million with respect to the outstanding PREPA receivable.
If an event of default occurs under the new revolving credit facility or the new term credit facility, as applicable, and remains uncured, it could have a material adverse effect on our business, financial condition, liquidity and results of operations.
In connection with the payoff of the term credit facility, Wexford waived the 1% early termination penalty. If an event of default occurs under the revolving credit facility and remains uncured, it could have a material adverse effect on the Company’s business, financial condition, liquidity and results of operations.
Intersegment revenue, consisting primarily of revenue derived from our well completion segment, was a nominal amount for 2023 and $2.5 million, or 5% of total sand revenue, for 2022.
Intersegment revenue, consisting primarily of revenue derived from our well completion segment, was a nominal amount for each of 2024 and 2023, respectively.
Revenue derived from related parties was $1.0 million for 2023 compared to $1.1 million for 2022. Revenue by division was as follows: Well Completion Services . Well completion services division revenue decreased $39.4 million, or 23%, to $131.3 million for 2023 from $170.7 million for 2022.
Revenue derived from related parties was $1.5 million for 2024 compared to $1.0 million for 2023. Revenue by division was as follows: Well Completion Services . Well completion services division revenue decreased $93.4 million, or 73%, to $34.0 million for 2024 from $127.4 million for 2023.
The following is a breakout of SG&A expenses for the periods indicated (in thousands): Years Ended December 31, 2023 December 31, 2022 Cash expenses: Compensation and benefits $ 15,563 $ 13,729 Professional services 13,448 13,501 Other (a) 7,693 8,012 Total cash SG&A expense 36,704 35,242 Non-cash expenses: Change in provision for expected credit losses (591) 3,389 Stock based compensation 1,345 923 Total non-cash SG&A expense 754 4,312 Total SG&A expense $ 37,458 $ 39,554 a.
The following is a breakout of SG&A expenses for the periods indicated (in thousands): Years Ended December 31, 2024 December 31, 2023 Cash expenses: Compensation and benefits $ 14,448 $ 15,563 Professional services 12,298 13,448 Other (a) 7,146 7,693 Total cash SG&A expense 33,892 36,704 Non-cash expenses: Change in provision for expected credit losses (b) 90,054 (591) Stock based compensation 875 1,345 Total non-cash SG&A expense 90,929 754 Total SG&A expense $ 124,821 $ 37,458 a.
We rented an average of 241 pieces of equipment to customers during 2023, a decrease of 3% from an average of 249 pieces of equipment rented to customers during 2022. This was offset by an increase in utilization for remote accommodations business.
We rented an average of 210 pieces of equipment per month to customers during 2024, a decrease of 13% from an average of 241 pieces of equipment per month rented to customers during 2023. These declines were offset by an increase in utilization for our remote accommodations business.
As of February 28, 2024, we had cash on hand of $10.5 million, no outstanding borrowings under our new revolving credit facility and a borrowing base of $23.3 million, leaving an aggregate of $17.0 million of available borrowing capacity under this facility, after giving effect to $6.3 million of outstanding letters of credit.
As of March 5, 2025, we had unrestricted cash on hand of $64.8 million, no outstanding borrowings under our revolving credit facility and a borrowing base of $33.7 million, leaving an aggregate of $26.2 million of available borrowing capacity under this facility, after giving effect to $7.5 million of outstanding letters of credit.
Well completion services division cost of revenue, exclusive of depreciation and amortization expense, decreased $20.0 million, or 16%, from $128.7 million for 2022 to $108.7 million for 2023 primarily due to a decline in utilization.
Well completion services division cost of revenue, exclusive of depreciation and amortization expense, decreased $66.3 million, or 63%, from $105.1 million for 2023 to $38.8 million for 2024 primarily due to a decline in utilization.
As a percentage of revenue, cost of revenue, exclusive of depreciation and amortization expense of $8.4 million in 2023 and $16.2 million in 2022, was 82% for each of 2023 and 2022, respectively. Natural Sand Proppant Services.
As a percentage of revenue, cost of revenue, exclusive of depreciation and amortization expense of $2.8 million in 2024 and $8.4 million in 2023, was 83% and 82% for 2024 and 2023, respectively. The increase as a percentage of revenue is primarily due to an increase in contract labor costs as a percentage of revenue. Natural Sand Proppant Services.
As a percentage of revenue, our well completion services division cost of revenue, exclusive of depreciation and amortization expense of $16.8 million in 2023 and $22.1 million in 2022, was 83% and 75%, for 2023 and 2022, respectively.
As a percentage of revenue, our well completion services division cost of revenue, exclusive of depreciation and amortization expense of $10.9 million in 2024 and $15.4 million in 2023, was 114% and 82%, for 2024 and 2023, respectively.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

12 edited+4 added−8 removed6 unchanged
Biggest changeSpecifically, we had receivables due from PREPA totaling $402.3 million as of December 31, 2023. PREPA is currently subject to bankruptcy proceedings pending in the U.S. District Court for the District of Puerto Rico. As a result, PREPA’s ability to meet its payment obligations under the contracts is largely dependent upon funding from the FEMA or other sources.
Biggest changeThis risk may be further enhanced by the volatility in commodity prices, the reduction in demand for our services and challenging macroeconomic conditions. 73 Specifically, we had receivables due from PREPA totaling $20.0 million as of December 31, 2024. PREPA is currently subject to bankruptcy proceedings pending in the U.S. District Court for the District of Puerto Rico.
We do not enter into investments for trading or speculative purposes. Interest under the new revolving credit facility equals the Tranche Rate (as defined in the new revolving credit facility) plus an applicable margin, which can fluctuate based on multiple facts, including rates set by the U.S.
We do not enter into investments for trading or speculative purposes. Interest under our revolving credit facility equals the Tranche Rate (as defined in the revolving credit facility) plus an applicable margin, which can fluctuate based on multiple facts, including rates set by the U.S.
For the years ended December 31, 2023, 2022 and 2021, we generated approximately 48%, 45% and 48%, respectively, of our revenue from our operations in Ohio, Wisconsin, Minnesota, North Dakota, Pennsylvania, West Virginia and Canada where weather conditions may be severe.
For the years ended December 31, 2024, 2023 and 2022, we generated approximately 35%, 48% and 45%, respectively, of our revenue from our operations in Ohio, Wisconsin, Minnesota, North Dakota, Pennsylvania, West Virginia and Canada where weather conditions may be severe.
We also maintain cash balances denominated in the Canadian dollar. At December 31, 2023, we had $2.4 million of cash in Canadian accounts. A 10% increase in the strength of the Canadian dollar versus the U.S. dollar would have resulted in an increase in pre-tax income of approximately ($0.2) million as of December 31, 2023.
We also maintain cash balances denominated in the Canadian dollar. At December 31, 2024, we had $4.0 million of cash in Canadian accounts. A 10% increase in the strength of the Canadian dollar versus the U.S. dollar would have resulted in an increase in pre-tax income of approximately ($0.3) million as of December 31, 2024.
We are unable to predict the ultimate impact of the volatility in commodity prices, any changes in the near-term or long-term outlook for our industries or overall macroeconomic conditions on our business, financial condition, results of operations, cash flows and stock price. Interest Rate Risk We had a cash and cash equivalents balance of $16.6 million at December 31, 2023.
We are unable to predict the ultimate impact of the volatility in commodity prices, any changes in the near-term or long-term outlook for our industries or overall macroeconomic conditions on our business, financial condition, results of operations, cash flows and stock price. Interest Rate Risk We had a cash and cash equivalents balance of $61.0 million at December 31, 2024.
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services. These factors have continued into the first quarter of 2024.
Throughout 2023, pricing for crude oil and natural gas declined from levels seen in 2022, which slowed down completion activities for our customers, in particular, in the Utica and Marcellus Shale natural gas plays, and, as a result, reduced demand for our well completion services.
See Note 2. Summary of Significant Accounting Policies—Accounts Receivable and —Concentrations of Credit Risk and Significant Customers and Note 20. Commitments and Contingencies—Litigation of our consolidated financial statements contained elsewhere in this annual report for additional information. Seasonality We provide infrastructure services in the northeastern, southwestern, midwestern and western portions of the United States.
See Note 2. “Summary of Significant Accounting Policies—Accounts Receivable” and “—Concentrations of Credit Risk and Significant Customers” and Note 20. “Commitments and Contingencies—Litigation” to our consolidated financial statements included elsewhere in this annual report for additional information. Seasonality We provide infrastructure services in the northeastern, southwestern, midwestern and western portions of the United States.
The inability, delay or failure of our customers to meet their obligations to us due to customer liquidity issues or their insolvency or liquidation may adversely affect our business, financial condition, results of operations and cash flows. This risk may be further enhanced by the volatility in commodity prices, the reduction in demand for our services and challenging macroeconomic conditions.
The inability, delay or failure of our customers to meet their obligations to us due to customer liquidity issues or their insolvency or liquidation may adversely affect our business, financial condition, results of operations and cash flows.
Inflation Although the impact of inflation has been insignificant on our operations in prior years, inflation in the U.S. has been rising at its fastest rate in over 40 years, creating inflationary pressure on the cost of services, equipment and other goods in our industries and other sectors and contributing to labor and materials shortages across the supply-chain.
Inflation During the last two years, inflation in the U.S. reached some of the highest levels in over 40 years, creating inflationary pressure on the cost of services, equipment and other goods in our industries and other sectors and contributing to labor and materials shortages across the supply-chain.
Although the levels of activity in the U.S. oil and natural gas exploration and production, energy infrastructure and natural sand proppant industries continue to improve, they have historically been and continue to be volatile.
Positive trends that may contribute to increased activity will come from LNG export capacity coming online and general electricity and power demand enhancements. Although the levels of activity in the U.S. oil and natural gas exploration and production, energy infrastructure and natural sand proppant industries continue to improve, they have historically been and continue to be volatile.
We have not hedged our exposure to changes in foreign currency exchange rates and, as a result, could incur unanticipated translation gains and losses. 75 Customer Credit Risk We are also subject to credit risk due to concentration of our receivables from several significant customers. We generally do not require our customers to post collateral.
Customer Credit Risk We are also subject to credit risk due to concentration of our receivables from several significant customers. We generally do not require our customers to post collateral.
Conversely, a corresponding decrease in the strength of the Canadian dollar would have resulted in a comparable increase in pre-tax income.
Conversely, a corresponding decrease in the strength of the Canadian dollar would have resulted in a comparable increase in pre-tax income. We have not hedged our exposure to changes in foreign currency exchange rates and, as a result, could incur unanticipated translation gains and losses.
Removed
In March and April 2020, concurrent with the COVID-19 pandemic and quarantine orders in the U.S. and worldwide, oil prices dropped sharply to below zero dollars per barrel for the first time in history due to factors including significantly reduced demand and a shortage of storage facilities.
Added
Throughout 2024, we continued to experience persistent challenges in our well completion business and other oilfield services associated with lower U.S. onshore activity and sustained weakness in the natural gas basins in which we operate. We expect 2025 completions activity to be relatively steady, with the potential for upside compared to 2024 driven by incremental demand associated with natural gas.
Removed
In 2021, U.S. oil production stabilized as commodity prices increased and demand for crude oil rebounded. We saw improvements in the oilfield services industry and in both pricing and utilization of our well completion and drilling services during 2022.
Added
Federal Reserve, the supply and demand for credit and general economic conditions, plus an applicable margin. At December 31, 2024, we had no outstanding borrowings under our revolving credit facility. We do not currently hedge our interest rate exposure.
Removed
Despite this short-term softness, however, we are seeing indications that activity levels will begin to ramp back up in mid-2024, creating the opportunity to reactivate additional fleets, if appropriate.
Added
Although inflation has recently moderated and the Federal Reserve has begun lowering interest rates, there can be no assurance regarding the timing of any such interest rate cuts or their impact on inflation or any future price changes.
Removed
The ongoing war in Ukraine and the recent Israel-Hamas war, however, could continue to have an adverse impact on the global energy markets and volatility of commodity prices, which could further adversely impact demand for our well completion services.
Added
If the inflationary pressures on our operating costs and capital expenditures persist, our business, results of operations and financial condition may be adversely affected.
Removed
Federal Reserve (which increased its benchmark interest rate by an aggregate of 4.75 percentage points throughout 2022 and 2023, and may continue to increase interest rates), the supply and demand for credit and general economic conditions, plus an applicable margin.
Removed
Interest under our new term credit facility equals the SOFR Interest Rate (as defined in the new term credit facility) plus 7.50%. At December 31, 2023, we had no outstanding borrowings under the new credit facility and $45.0 million outstanding under our term loan with an interest rate of 12.9%.
Removed
Based on the outstanding borrowings under our term loan as of December 31, 2023, a 1% increase or decrease in the interest rate would have increased or decreased our interest expense by approximately $0.5 million per year. We do not currently hedge our interest rate exposure.
Removed
Throughout 2022 and 2023, the Federal Reserve increased its benchmark interest rates by an aggregate of 4.75 percentage points, and may continue increasing benchmark interest rates in the future. If the efforts to control inflation are not successful and inflationary pressures persist, our business, results of operations and financial condition may be adversely affected.

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