Risk Assessment and Management

Management’s Role in Risk Assessment and Management

Our senior-level management is responsible for identifying corporate risks, including climaterelated risks and opportunities, assessing the potential level of impact to the business, and discussing this risk assessment with the Board on at least a quarterly basis. We believe that climate risks are inherently business risks, and our assessment of these climaterelated transition and physical risks is integrated into our business risk assessment process.

Risks and opportunities are identified through discussions with stakeholders, including customers, investors, trade associations and industry groups; engagement with sustainability-related groups; and our own business risk assessments, as well as regular monitoring of legal, regulatory and policy changes with the potential to affect the industry as well as our Company specifically.

Risk Management

Risk assessment communications with the Board involve seniorlevel management’s preparation and presentation to the Board of a risk mapping exercise, which categorizes identified risks, including climate change-related risks, according to their probability and severity. The purpose of these regular risk assessments is to identify those risks that have the potential to significantly affect our business over the short, medium and longer term and to discuss appropriate mitigation and oversight measures, including prioritization of risk management and allocation of responsibility for the management of a particular risk.

Management of Sustainability Matters

Senior Vice President of Sustainability, Diversity and Culture

We continue to evaluate and evolve our Company in matters regarding sustainability, and recently expanded the role of our former Vice President of Diversity and ESG to a Senior Vice President of Sustainability, Diversity and Culture. This position continues to report directly to the CEO. Pursuant to the direction of the CEO and other members of the leadership team, and under the oversight of the Sustainability Committee of the Board, the Senior Vice President of Sustainability, Diversity and Culture provides direction and pursues a consistent approach across the business segments to sustainability-related initiatives and objectives.

The Senior Vice President of Sustainability, Diversity and Culture routinely meets with the Company’s leaders and other employees, including from the marketing and sales, technology, health, safety and environment, investor relations, legal, and operations departments to discuss the development and implementation of the Company’s sustainability initiatives, evaluate internal and external sustainability-related communications, and formulate advice, counsel and recommendations to senior leadership regarding sustainability efforts at the Company, including efforts around employee and community engagement.

The Senior Vice President of Sustainability, Diversity and Culture and other members of leadership routinely engage with the members of the Sustainability Committee of the Board to provide updates around sustainability-related policies and performance, including but not limited to, environmental risks and opportunities, social responsibility and impacts, employee, contractor and community health and safety, and activities related to stakeholder engagement and community investment.

Information Security and Cybersecurity Risks
We have implemented and maintain a cybersecurity program that is aligned with the National Institute of Standards and Technology (NIST) Framework and designed to protect our information and to assess, identify, and manage risks from cybersecurity threats that may result in material adverse effects on the confidentiality, integrity, and availability of our information systems.

The Company also monitors systems and practices regarding the use of artificial intelligence to enhance business objectives, while also ensuring proper governance and oversight. These efforts are led by the Chief Information Officer with input from key stakeholders across the business.

Our net expenses incurred from information security breaches over the last three years, relative to total revenue, were immaterial, and we had zero net expenses incurred from information security breach penalties and settlements over the last three years.

A description of our governance and risk management and strategy relating to cybersecurity issues can be found in Part I, Item 1C of our most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission.

Information Security and Cybersecurity Risks

We have implemented and maintain a cybersecurity program that is aligned with the National Institute of Standards and Technology (NIST) Framework and designed to protect our information and to assess, identify, and manage risks from cybersecurity threats that may result in material adverse effects on the confidentiality, integrity, and availability of our information systems.

Climate-Related Risks

We have categorized our key environmental and climate-related risks into the following areas: (i) Policy and Legal Risks, (ii) Market/ Technology Risks, (iii) Reputational Risks, and (iv) Physical Risks. The following is a summary of these climate-related transition and physical risks. For a more detailed discussion of these risks, please see the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Policy and Legal Risks

Policy and legal risks that we have identified include, but are not limited to, legislation, regulations or other measures relating to emissions, our products and services, and the oil and gas industry generally. We monitor and evaluate how to manage risk related to the actions and proposed actions of local, state, regional, national and international regulatory bodies on greenhouse gas emissions and climate change issues. Proposed actions include, but are not limited to, the imposition of cap-and-trade programs, carbon taxes, GHG reporting and tracking programs, attestation requirements and regulations that directly limit GHG emissions from certain sources, and prohibitions on, or increased regulation of, drilling and pressure pumping activities. Continued efforts by governments and nongovernmental organizations to reduce GHG emissions appear likely, and additional legislation, regulation or other measures that control or limit GHG emissions or otherwise seek to address climate change could adversely affect our business.

To address these risks, we work with our customers on mutually beneficial solutions to support their climate and emissionsrelated targets, scenarios and goals through our provision of loweremissions equipment, technology and software solutions that increase efficiency and reduce emissions in our and our customers’ operations. If we can enable lower-emissions operations by our customers, we can help to reduce our customers’ exposure to the adverse effects of potential climate-related regulation, and thus maintain demand for our services.

Please see “Minimizing Environmental Impact – Air Quality, Greenhouse Gas Emissions and Energy Usage” for additional detail regarding these efforts. In addition to the impact on our customers described above, climate-driven restrictions and increased regulations on our drilling and completion services operations could limit or delay our operational activities, increase our operating costs and result in additional regulatory burdens, which could make it more difficult to perform our services and increase our costs of compliance and doing business.

To address these risks, we continue to monitor and assess any new policies, legislation or regulations in the areas where we operate to determine the impact of GHG emissions and climate change on our operations and take appropriate actions, where necessary.

Market and Technology Risks

Market and technology risks that we have identified include the potential substitution of traditional oil and gas services and products with lower-emissions options, as well as potential costs to transition to lower-emissions technology. These risks are driven by market demand, as our customers attempt to satisfy their own climate targets, scenarios and goals and respond to regulatory and stakeholder requirements for lower-emissions operations.

Legacy oil and gas assets and technology may be made obsolete due to shifting market preferences, and we may need to continue to develop assets and technology to satisfy demand for lower-emissions operations and services. To the extent any existing assets and technology are made obsolete, we may face write-downs and early retirements of assets. We address this risk by developing new products, software and services and by creating mutually beneficial solutions with our customers to meet growing demand to increase efficiency and reduce emissions generated by their operations.

These developments may result in a need to increase our capital expenditures, reallocate capital and increase research and development expenditures. Another market risk we have identified is that fuel conservation measures, alternative fuel requirements and increasing consumer demand for alternatives to oil and natural gas could reduce demand for oil and natural gas. The increased competitiveness of alternative energy sources (such as wind, solar, tidal, and biofuels) could reduce demand for oil and natural gas, and therefore for our services.

Reputational Risks

Reputational risks that we have identified are primarily related to concerns about the oil and gas sector due to the increasing weight put on climate change issues by regulatory bodies, the investment community, and others. The lending and investment practices of institutional lenders and investors have been the subject of intensive lobbying efforts in recent years, oftentimes public in nature, not to provide funding for oil and natural gas producers. Limitation of investment in and financing for oil and natural gas could result in the restriction, delay, or cancellation of drilling and completion programs or development of production activities.

In addition, an increasing number of our customers consider sustainability factors in awarding work. If we are unable to successfully continue our sustainability enhancement efforts, we may lose customers, our stock price may be negatively impacted, our reputation may be negatively affected, and it may be more difficult for us to effectively compete.

If the reputation of our industry generally, or our Company specifically, is impacted by climate change concerns, this could result in a reduction in capital availability and/or an increased cost of capital, both for us and our customers, and may reduce demand for our services and have an adverse effect on our business. While we have a limited impact on the overall reputation of our industry, we seek to address our Company-level reputational risks through our continuing development of loweremissions equipment, technology and software solutions, as well as related marketing outreach efforts to promote our efforts.

Physical Risks

Increasing concentrations of GHGs in the Earth’s atmosphere could trigger significant physical effects from climate change, such as increased frequency and severity of storms, floods and other climatic events, which could have an adverse effect on our operations. Our facilities are primarily onshore in the United States and in other select countries that are generally not located in low-lying areas that are subject to physical risks for climate change such as flooding and rising sea levels. However, our operations are subject to other physical risks, including, for example, the potential risk of increased heat stress on our personnel and equipment should temperatures rise due to climate impacts.

To address this risk, our management system includes policies relating to safety, including procedures for hot weather work. Should temperatures rise, there is a potential for these procedures to be used more often, and increased stress to be put on our equipment, both of which may result in increases in our operating and capital expenses. If climate change leads to more extreme weather, we could also experience negative weather impacts to our facilities and jobsites.

Water used in our operations is purchased and controlled by our customers. However, if water shortages become acute in our areas of operation due to climate change or regulatory impacts, such shortages (and related restrictions on water use) could negatively impact our ability to perform services, and customers’ demand for our services, in such areas.

Management of Climate-Related Risks and Opportunities

We work to mitigate climaterelated and other risks, to the extent we are reasonably able to do so. Mitigation of risk can take many forms, but we primarily mitigate and address these transition risks by providing, and continuing to develop, lower-emissions equipment, technology and software solutions. We prioritize management of climate risks, as with other corporate risks, based on the likelihood of occurrence weighted against severity.

While we are subject to the climate-related risks listed above, we believe that we may benefit from certain climate-related opportunities. We believe we currently have a leadership position in equipment, technology and software solutions that puts us at a competitive advantage as customer demand shifts to lower-emissions operations and services.

For example, we have increased our usage of alternative fuel equipment (such as using rich-burn natural gas engines in place of traditional diesel-only equipment), are continuing our development of innovative, loweremissions technology (such as battery power hybrid energy management systems and technology enabling the use of utility electrical power in our operations) and are redesigning our own equipment to maximize efficiency (such as through the development of emission-reducing automation, remote operations and control systems).

We will continue to invest capital in sustainable solutions and other emission reducing equipment based on the needs of our customers. We are also pursuing opportunities related to renewable energy sources, such as electric fleets and other alternative power solutions. We utilize equipment that runs on a variety of fuels to improve efficiency and reduce environmental impact. Please see “Minimizing Environmental Impact – Air Quality, Greenhouse Gas Emissions and Energy Usage” above.

We plan to continue our development of alternative fuels and lower-emissions solutions. This strategy could result in increased capital expenditures or allocation of funds to research and development, as well as the formation of strategic partnerships with companies that can assist our customers in meeting their climate and sustainability-related goals.

Environmental Management System

Our internal policies and procedures, combined with our audit and training programs described above, also help us manage risks. For example, we have created a comprehensive Environmental Management System (EMS) including hundreds of proprietary environmental protection and safety-related policies, as discussed above in “Minmizing Environmental Impact – Environmental Management.”

Metrics, Scenarios and Targets

We consider a variety of metrics to assess our performance with regard to climate risks and opportunities. For example, we track our diesel fuel savings from the use of our alternative fuels technologies in order to demonstrate to customers and other stakeholders the fuel savings and emissions reduction that result from using our services.

We internally track the amount of research and development and capital expenditures spent on developing, building and deploying the technology and equipment behind our lower-emissions operations and services.

We continue to explore models for tracking and reporting of emissions from our operations and participate in discussions regarding best methods for tracking and reporting of GHG emissions with industry. We also continue to evaluate opportunities from time to time to provide our services outside of the United States, as diversification of geographical opportunities may help to insulate our business from the risks associated with operating solely in the United States.