Company: WBI
Filing Date: 2025-04-18
Form Type: DRS
Source: 0000950123-25-003575
Chunk: 149

Company: WaterBridge Infrastructure LLC
Filing Date: 2025-04-18
Form: DRS
Chunk 149
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 their ultimate well economics. We believe that produced water management costs comprise between 30% and 40% of E&P producer’s total LOE in the Delaware Basin and represent the largest component of total LOE. We believe that water management costs are likely to increase in the future due largely to producers having to transport volumes farther to access available pore space outside of the majority activity zones in the Delaware Basin.

### Overview of the Water Management Business
Water Supply

During the lifecycle of a typical horizontal well, supply water is first delivered to a wellsite either by pipeline or by truck. Supply water is typically fresh or brackish water sourced from rivers, ponds, lakes, and aquifers. Produced water can also be used as supply water; however, naturally occurring impurities and those added during the hydraulic fracturing process, must be removed prior to reuse. Once at the wellsite, supply water is mixed with additives and proppants before being injected, at high pressure, into the wellbore to hydraulically fracture a well.

Water Disposal

Following a well’s completion, the produced water, oil and natural gas must be separated and the produced water transported away from the well via pipeline or by truck for disposal or recycling. Disposal often occurs through injection into saltwater disposal wells at water handling facilities. These water handling facilities are commonly regulated by state environmental bodies as well as the EPA. Produced water may also be disposed of in evaporation and percolation pits or recycled for use as supply water in later hydraulic fracturing activities.

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Water Recycling

Recycling of produced water is an alternative to sourcing brackish water or groundwater for use in oil and gas operations. Recycled produced water is treated prior to reuse. This treatment typically involves the removal of residual hydrocarbons, reduction of free iron and other solids and removal of bacteria to meet customer specifications. Recycling of produced water volumes can be performed via recycling centers and treatment facilities. In the future, these recycling operations may include additional units in order to further upgrade the recycled water to be used in other commercial and industrial applications, potentially even for beneficial re-use.

The following diagram illustrates the breadth of our operations and how they interconnect with the drilling operations of our E&P customers.

#### Growth Trends of Produced Water
The Delaware Basin has experienced significant growth in oil and natural gas production activity over the last four years, with approximately 60% and 34% growth in wells brought online and active drilling rigs, respectively, according to Enver