The following is a summary of the Aris Water Solutions, Inc. (ARIS) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Aris Water Solutions reported a strong financial performance in Q3 2024, with an adjusted EBITDA of $54.3 million, up 21% year-over-year and 9% sequentially.

• Adjusted operating margin was $0.45 per barrel, up 13% compared to the same quarter last year.

• Capital expenditures for the nine months were $83 million, with the full-year guidance maintained between $98 million and $105 million.

Business Progress:

• Aris saw produced water volumes grow 2% sequentially and 6% year-over-year. Recycled water volumes increased 25% sequentially and 16% year-over-year.

• The company expects stronger water demand moving into 2025, driven by operations in the Northern Delaware Basin.

• Plans to scale up desalination technologies in 2025 for treated produced water and explore mineral extraction potentials.

• Actively working on projects for beneficial reuse of water with partners like ConocoPhillips and ExxonMobil.

Opportunities:

• Sustained investments in operational efficiencies and cost reductions are projected to enhance future cash flows.

• Opportunities for beneficial reuse of treated produced water in industries outside oil and gas.

• Potential expansion in mineral extraction technology such as iodine, magnesium, ammonia, and lithium.

Risks:

• Possible variability in skim oil recoveries impacting quarterly financial results.

• The company is prone to market risks associated with commodity price volatility and regulatory changes.

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