Select Water Solutions, Inc.

What they do

Select develops and operates permanent water infrastructure including pipeline networks, fixed and mobile recycling and treatment facilities, water storage, saltwater disposal wells (SWDs) and landfills, supporting oil and gas well development and ongoing production. As of December 31, 2025 the network had 2.4 million barrels per day of fixed recycling capacity, 2.3 million barrels per day of permitted disposal capacity and 35 million barrels of produced water storage. It also provides last-mile water transfer, field automation, and oilfield chemicals manufactured in-basin, and operates through three segments: Water Infrastructure, Water Services and Chemical Technologies.

Revenue drivers

• Water Infrastructure — Permanent pipeline, recycling, treatment, storage, SWD and landfill assets monetized through long-term contracts with acreage/wellbore dedications, MVCs, AMIs and ROFRs, plus interruptible deals for spare capacity; generated record quarterly revenue of $102M in Q2 2026, up 26% year-over-year.
• Chemical Technologies — In-basin manufactured oilfield chemicals and surfactant technology; set a segment record of $96M revenue in Q2 2026, up 23% sequentially, with 20% margins in the quarter.
• Water Services — Last-mile water transfer, hauling, rentals and related field services; the Omni transaction divested trucking in the Bakken, Northeast and MidCon, rentals in the Bakken and one MidCon SWD, businesses that represented roughly 8% of segment revenue in the first half of 2025.

Recent performance

Q2 2026 consolidated revenue was $396M, up $30M or 8% sequentially from Q1 2026, with net income of $23M and Adjusted EBITDA of $93M. Water Infrastructure and Chemical Technologies both posted record quarterly revenue of $102M and $96M, respectively. Approximately 1.5 million barrels of produced water were recycled or disposed per day in Water Infrastructure, with segment gross margins before D&A of 58%. Full-year 2025 revenue was $1.41B with net income of $21.2M and operating cash flow of $214.7M; 2024 revenue was $1.45B with $30.6M net income.

Strategy

Select is scaling a recycling-first network centered in the Permian Basin, particularly the Northern Delaware, adding fixed recycling facilities and large-diameter bidirectional pipelines; after projects under construction or contract, it expects about 1.7 million barrels per day of active produced water recycling capacity and 26 million barrels of storage. In Q2 2026 it signed a definitive agreement with a large public operator covering conveyance of 14 SWDs and a new pipeline project backed by a 128-million-barrel minimum volume commitment over seven years in the Northern Delaware. It spent $25.4M on 2025 asset acquisitions in the Permian and Northeast and acquired the Omni Bakken platform (landfill, diesel/hydrocarbon recovery, Class II SWD, tank farm) while divesting lower-margin trucking and rental operations. It is also pursuing freshwater optionality for municipal and industrial offtake and critical minerals such as lithium and iodine from produced water.

Risks

• Customer concentration in contracts — Revenue growth depends on long-term dedications, MVCs and AMIs with a limited set of operators, and the Q2 2026 award of 14 SWDs and a 128-million-barrel commitment ties a meaningful expansion to one large public operator.
• Commodity and input cost exposure — Raw material costs rose to $73.0M in Q2 2026 from $58.8M a year earlier and management cited increases in oil-based raw material input costs pressuring Chemical Technologies margins.
• Capital intensity of infrastructure buildout — Select now expects 2026 net capital expenditures of $250-$290M to fund Permian pipeline and recycling projects, and returns depend on utilization and contracted volumes materializing.
• Regulatory and seismicity constraints — Produced water disposal faces growing concern about induced seismicity and pore space limitations in key regions, which could affect permitted disposal capacity or require more recycling infrastructure.

Outlook

Management said Q2 2026 was strong across all three segments and expects further Water Infrastructure growth in Q3, with the segment on track for the upper end of full-year guidance and year-over-year growth into 2027. Chemical Technologies results came in well above expectations on a 23% sequential revenue increase. Reflecting new infrastructure contract awards and opportunities, Select raised its 2026 net capital expenditure expectation to $250-$290M.