Company: WBI
Filing Date: 2025-06-02
Form Type: DRS/A
Source: 0000950123-25-005943
Chunk: 19

Company: WaterBridge Infrastructure LLC
Filing Date: 2025-06-02
Form: DRS/A
Chunk 19
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. The Permian Basin, and specifically the Delaware Basin, has consistently attracted substantial drilling activity, even amidst varying commodity prices and macroeconomic conditions. As of March 31, 2025, there were 265 drilling rigs in the Permian Basin, representing 54% of all rigs running in the United States, with 163 rigs running in the Delaware Basin alone, according to Enverus. The region has seen significant advancements in drilling efficiency, largely due to pad development and technological innovations, which have increased the number of wells turned-in-line (“TIL”) per rig. This efficiency is crucial as it allows for the maximization of production and well economics, further driving the demand for effective water management solutions. Water management is a critical component of upstream oil and natural gas operations, particularly in unconventional basins like the Permian. The process involves the supply of water for hydraulic fracturing, the separation and disposal of produced water, and increasingly, the recycling of produced water for reuse. Water management costs represent a significant portion of upstream producers’ lease operating expenses (“LOE”), particularly in the Delaware Basin, where they can account for 30 to 40% of total LOE. As producers continue to extend lateral lengths and increase production, the demand for efficient water management solutions is expected to grow, underscoring the importance of our operations in supporting the industry’s evolving needs. 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 Enverus. We believe that this growth in production activity will require increased produced water handling capacity,

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as the amount of produced water from wells in the Delaware Basin significantly exceeds the amount of the related oil and natural gas production. Specifically, for every barrel of oil produced in the Delaware Basin in 2024, approximately 3.7 barrels of associated water were produced, according to Enverus. Produced water volumes have increased as oil and natural gas production has increased in the Delaware Basin over the last several years. From 2014 to 2024, produced water in the Delaware Basin grew from approximately 1.7 million bpd to approximately 11.8 million bpd, a CAGR of more than 20%. Historical and forecasted Delaware Basin produced water volumes as of September 30, 2023, including the anticipated incremental increase in produced water volumes that could be recycled or handled in existing or