Greetings. Welcome to NESR's financial results conference call for the fourth quarter of 2025. Please be aware that this conference is being recorded. I will now hand it over to Blake Gendron, Vice President of Investor Relations. Thank you. You may begin.

Thank you, Sherry. Hello, and welcome to NESR's Fourth Quarter 2025 Earnings Call. With me today are Sherif Foda, Chairman and Chief Executive Officer of NESR, and Stefan Angeli, Chief Financial Officer. On today's call, we will comment on our fourth quarter results and overall performance. After our prepared remarks, we will open up the call to questions. Before we begin, I'd like to remind our participants that some of the statements we'll be making today are forward-looking. These matters involve risks and uncertainties that could cause our results to differ materially from those projected in these statements. I, therefore, refer you to our latest earnings release filed earlier today and other SEC filings. Our comments today may also include non-GAAP financial measures. Additional details on reconciliations to the most directly comparable GAAP financial measures can be found in our press release, which is on our website. Finally, feel free to contact us after the call with any additional questions you may have. Our Investor Relations contact information is available on our website. Now I'll hand the call over to Sherif.

Thanks, Blake. Ladies and gentlemen, good morning, and thank you for participating in this conference call. I'm pleased to report that we ended a tremendous '25 with even stronger-than-expected results in the fourth quarter. Most importantly, we safely and efficiently kicked off the largest unconventional frac program in sector history, effectively managed our costs and achieved yet another record high for revenue and free cash flow. These results are a testament to our hard-working teams in the field, their dedication and commitment. Thanks to our customers for their trust and unwavering support in the entire region. Reaching this stage of company growth was NESR's original national champion vision, and we now have our sights set on even greater heights. On today's call, I'll start with an update on the Middle East macro and activity tied to key megatrends related to global energy, technology, and geopolitics. Alongside the macro, I'll go into NESR's specific drivers by country to outline key takeaways from an extremely busy industry conference season to start the year. This will hopefully clarify the ample growth runway that we have beyond our original $2 billion target. First, the macro. As previously discussed, overall, we see a baseline of steady activity growth across the MENA region, driven by oil capacity expansion and strategic domestic gas development. Additionally, what changed is the increased appetite of the IOC to enter into various MOU and exploration awards that are unprecedented in some countries like Iraq, Algeria, Libya, Kuwait, and even Syria. Countries like Kuwait continue to lead with robust investment programs, but perhaps the most notable aspect of the current cycle is that every single one of our anchor countries is either growing steadily or is stable at all-time high. Considering the negative consensus view around global growth and commodity prices, these trends are a stark reminder that there is truly a solid floor of activity on which the MENA service sector can continue to build with any upside to the macro or commodity outlook. There is no other region in the world like this one for persistent upstream growth, capacity expansion, and strategic gas development. MENA trends are largely decoupled from oil and gas prices, and NESR is taking full advantage of it. Talking about Kuwait in more detail. We recently conducted our Board meeting following the impressively successful COGS Oil and Gas Show in Kuwait City. Our goal was to demonstrate our commitment to the highest level in the country, show our Board firsthand the super cycle that is now entering its second year, in addition to the unique opportunities for NESR. As you recall, we started in Kuwait from nothing just a few years ago, and it will soon become our second largest country behind Saudi. During COGS, country leadership reiterated their commitment of $8 billion to $10 billion per year in upstream spending through 2030 to expand oil capacity by an additional 1 million barrels to a total of 4 million barrels per day by 2035. Not only does this lock in continued growth for years to come, but also implies an even higher activity trajectory than previously anticipated. Additionally, for the first time, as publicly announced, His Highness, the Prime Minister, presided over several agreements and MOUs signed during COGS with IOC, the likes of Total, BP, Shell, and several other international companies. The program encompassed both oil and gas, spanning land and offshore, and will truly launch an activity renaissance in a country that has already achieved an impressive level of growth over the past year. For NESR, there is a huge upside in Kuwait with all of our recent in-country investment, high-level engagement with customer leadership, and with a proven track record of operational scale and open technology development. The evolution of NESR in Kuwait over the coming years will dovetail perfectly with the transformation of the Kuwait energy sector. We previously announced our Ahmadi Innovation Valley or AIV initiative, which will give NESR first-ever access to technology development in Kuwait. This project will supplement and enhance our core services, which are growing on the back of recent contract wins and upcoming tenders, and will also drive new frontiers in the areas of decarbonization, water, and critical minerals. Considering all of the plans and partnerships and ambitions announced at COGS, our leadership in AIV could not be more perfectly timed. In Abu Dhabi, activity continues to march above all-time high. As publicly announced, in late '25, ADNOC approved a sweeping $150 billion oil and gas investment plan for the '26-2030 time frame, which should keep the growth trajectory intact for years to come. North Africa remains a key growth pillar led by a surge of activity in Libya, which headlined its recent summit in AAA with dual announcements with ConocoPhillips and Total. This collaboration captured $20 billion in investments over 25 years, an unprecedented commitment not just in terms of magnitude, but also longevity as country leadership has truly embraced foreign investment into its world-renowned resource base. Additional blockbuster bids from Libya last week include the new exploration block awards to Chevron, Repsol, MOL, among others. While activity over the past year has already increased political cohesion in Libya, its highly successful bid round provides a roadmap to increase oil capacity from 1.4 million barrels per day today to 1.6 million by year-end and 2 million by 2030. Libya is yet another core NESR country that is planning over the multiyear horizon. Based on our recent meetings with the Libya NOC and country leadership, NESR will play a key role in this visionary capacity expansion. Elsewhere in the region, we see stable, good activity levels in Algeria, Oman, Iraq, and Egypt. We see some strategic discussions that could supercharge the NESR story primarily through new contract wins and an improving oil outlook over the medium term. Unsurprisingly, we've been as busy with recent tendering as we've been on the industry conference circuit, and no doubt, there is a connection between the two. Adding up the budgetary commitment from our four largest GCC countries implies nearly $300 billion in general upstream spending through 2030. While not all of that budget is pure services, it's worth noting that the budget only captured a portion of our anchor countries and does not include the wave of IOC spending that is coming with the shifting geopolitical landscape. Beyond Jafurah, there is still a multibillion opportunity for NESR, results from which could be announced soon. We are very excited and optimistic about NESR's position in these tenders, and our nimble operating model has proven effective in the face of fierce tender competition. These potential awards will keep NESR's growth engine running far beyond the timeframe that most investors view our stock or sector. To conclude and before passing on to Stefan, I'd like to discuss what is the most anticipated topic of this call, which, of course, is the start-up of the Jafurah frac project. As previously discussed, we initiated operation on time in early November and have worked seamlessly with our highly supportive Aramco partners to ramp operations safely and effectively. HSE and service quality remain our top priority in everything we do and especially in ramping a project of such massive scale at Jafurah. All of our careful organization and planning of supply chain, logistics efforts, which go all the way back to our initial frac in 2019, are paying off, and we are delivering stages as planned. Cost control across both procurement and operation is evident in the fourth quarter result, and there is much more optimization to achieve. Our entire process from securing suppliers, hiring crews, moving materials, implementing the best technology from the U.S. shale, maintaining best-in-class uptime, and pumping hours is on plan, even as we triple and aim to quadruple the footprint. Aramco is truly on another leadership level for world-class unconventional development, and we look forward to updating the market on future achievements in the quarters to come. With that, let me pass the call to Stefan to discuss our equally exciting results on the finance front.

Thank you, Sherif. Good morning to those joining us from the United States, and good afternoon, or good evening to our participants across the Middle East, North Africa, Asia, and Europe. We appreciate you taking the time to be with us today. I'm extremely pleased to provide an update on our financial results for the fourth quarter and full year ended December 31, 2025, and to share our perspectives on the outlook for 2026. Let's start with our fourth quarter 2025 performance. Our fourth quarter revenue was $398.3 million, an all-time high, representing an increase of 34.9% sequentially and 15.9% year-over-year. Sequential growth was driven primarily by the mobilization of the new Jafurah contract beginning November 1, along with strong activity increases in North Africa. On a year-over-year basis, revenue growth was supported by higher activity levels in Saudi Arabia, Kuwait, Iraq, Egypt, and Libya. Adjusted EBITDA for the fourth quarter of 2025 was $84.4 million, representing a margin of 21.2%, broadly in line with the third quarter levels despite higher revenues generated from competitively priced contract wins. Margins remained stable due to strong cost discipline, improved operational execution across our portfolio, and the continued benefit of our lean overhead structure. Adjusted EBITDA for the fourth quarter includes $24.1 million of total charges and credits impacting adjusted EBITDA, primarily related to four items: one, $7.1 million of current expected credit loss provisions, primarily in Oman, which the company still feels confident that it will collect; two, $8.1 million of impairment charges related to two small legacy technology investments impacted by global changes in market focus on ESG in the last year; three, $4.7 million of contract mobilization-related restructuring costs, all related to our recent contract win and the deployment of that contract in Oman; four, $3.7 million of other write-offs with $3.1 million related to property, plant, and equipment, particularly a provision recorded for a construction in-process prepayment in Saudi Arabia following a vendor bankruptcy. To reemphasize, these adjustments are predominantly one-time items, and we fully expect going forward charges and credits to be minimal. We do not expect any material contract mobilization-related restructuring costs in 2026. Interest expense for the fourth quarter of 2025 was $7.5 million, while income tax expense was $7.2 million. Adjusted diluted earnings per share for the fourth quarter of 2025 was $0.32. Full-year 2025 revenue totaled $1.324 billion, up 1.7% year-over-year. Growth was supported by higher activity levels across Kuwait, Iraq, Abu Dhabi, Libya, Egypt, and Algeria, partially offset by lower rig counts and contract transitions in Saudi Arabia. Full year 2025 adjusted EBITDA was $281.4 million with margins of 21.3%, down approximately 250 basis points year-over-year, driven by country and segment mix in addition to certain contract transitions. Full year '25 interest expense was $32.5 million, down $7.4 million year-over-year, reflecting lower average debt levels. Full year '25 income tax expense was $9.3 million or $18.4 million as adjusted for a one-time tax provision release in Q3 '25. Adjusted diluted earnings per share for the full year of '25 was $0.81. Turning to cash flow and liquidity, which continues to be one of the clearest strengths of our model. Fourth quarter operating cash flow and free cash flow were exceptionally strong, driven by record fourth quarter collections and our lowest year-end DSO ever, reflecting disciplined working capital management across the organization. In line with our countercyclical investment strategy, we proactively deployed capital toward recent contract awards, accelerating operational ramp-up and rapidly positioning the business for the next phase of growth. For full year '25, cash flow from operations totaled $264.2 million, and free cash flow was $120.8 million, representing approximately 43% conversion from adjusted EBITDA, a level that underscores the quality of our earnings and the scalability of our platform. Total '25 capital expenditures, including both cash and vendor financed amounts, were $150.9 million, fully aligned with our previously communicated plans. Importantly, for the third consecutive year, the majority of our free cash flow was directed toward reducing bank debt, further strengthening our balance sheet and positioning the company for its next phase of growth. As of December 31, '25, gross debt totaled $310 million and net debt was $185.3 million. Our net debt-to-adjusted EBITDA ratio stood at 0.66, well below our target threshold of 1x. On a trailing 12-month basis, return on capital employed or ROCE, was 10.2%, reflecting continued disciplined execution of our growth investment strategy and improving capital efficiency. Now looking ahead. For the first quarter of 2026, we expect more muted seasonality than previous years due to the continued ramp of recent contract awards and resilient growth in places like Kuwait and North Africa, mainly offsetting the impact of Ramadan falling completely in the first quarter. Similarly, margins are always the weakest in the first quarter and then are expected to increase sequentially through the balance of the year on robust top-line growth and operating leverage. Overall, this year should be our best growth year ever, exceeding any previous indication. As we highlighted last quarter, we continue to see a path to exiting '26 at an annualized revenue run rate of approximately $2 billion, underpinned by our growing contract portfolio and consistent operational delivery. Full year '26 EBITDA margins are expected to remain broadly consistent with '25, supported by disciplined execution and cost control. As mentioned, we expect gradual sequential improvement in margins over the course of the year. For Q1 '26, interest expense is expected to be approximately $7.5 million, with full year '26 interest expense in the $22 million range. We continue to expect full year effective tax rate in the 22.5% range, consistent with prior levels. For the full year '26, we expect capital expenditures of approximately $165 million, consistent with the expanding growth outlook we've outlined and supported by a strong pipeline of recently awarded contracts. While our customers appreciate our standout countercyclical growth investment, it's worth noting to our shareholders that our CapEx as a percentage of revenue will be down on a year-over-year basis. We expect cash flow from operations in '26 to remain strong. As a result, free cash flow for the full year '26 is projected to comprise approximately 35% to 40% conversion from adjusted EBITDA, representing sector-leading free cash flow growth. Now on the housekeeping topics. As you can see, the company has entered a new phase of growth. Our contract base is strong. Our balance sheet is solid. Leverage remains low, and cash flow generation continues to be robust. As we highlighted on our previous call, we expect to provide an update on our formal capital allocation and shareholder return framework during our next earnings call. The outlook across the Middle East and North Africa remains constructive. We expect the region to lead the next wave of activity growth, underpinned by continued investment in oil capacity and accelerating gas development across our core markets. NESR remains disciplined and focused on driving profitable growth, strengthening operational execution, expanding our technology capabilities, reducing leverage, and optimizing working capital, all of which position the company to deliver sustainable long-term value. On behalf of management, I want to sincerely thank our employees for their commitment and exceptional performance in delivering these results and advancing our strategic priorities. I also extend our appreciation to our shareholders and banking partners for their ongoing confidence in our strategy and execution. NESR is entering 2026 from a position of strength, supported by strong operational momentum, a growing contract base, and significant market opportunities ahead. Now I'll turn the call back to Sherif.

Thanks, Stefan. Let me conclude. The fourth quarter represents a significant milestone for the company not just in terms of hitting ambitious growth targets but also in proving that we can do so profitably and with strong cash flow generation. For NESR, growth, returns, and cash flow are not an either/or but rather an all-of-the-above feature of our strategic model that investors are increasingly recognizing. This is why earlier this year, we updated and rolled out our internal strategy to double the size of the company over the next couple of years. Jafurah and our existing business are not a ceiling but rather a foundation upon which to win more, commercialize new technologies, and evaluate strategic opportunities to enhance our regional position in MENA. This strategic flexibility starts with the unmatched quality of the MENA region and our customers. The Middle East represents the lowest cost hydrocarbon production, and its reestablishment as the swing producer in oil, combined with secular growth tailwinds in gas and the renewed entry of IOC, gives the current cycle multiyear durability. In our view, the first step to maximizing shareholder value is to align our strategy and countercyclical investment with this multiyear view of our NOC and IOC customers. We appreciate our long-term shareholders for their patience in letting this story play out, and we welcome all of the newcomers that recognize the multiyear runway in front of us. With that, we are ready to take your questions. Sherry, please open the floor for your questions.

Our first question is from David Anderson with Barclays.

Nice to hear another good quarter here, Sherif. I really want to ask you about Jafurah and kind of where we are today. Obviously, this is sort of setting the stage going forward. But in terms of Jafurah, I think you've talked about getting to about 500,000 horsepower of pressure pumping equipment there. Where are we today in that? And can you walk us through kind of how you get to a full steady state of getting to that $2 billion a year run rate? What needs to get there? Where are we today in terms of the ramp-up at Jafurah?

Thanks, Dave. As we mentioned, we started on November 1st on schedule with our first, second, and third fleets. We are closely coordinating with our customer regarding the potential for one or two additional fleets based on their program needs. We are proactive in acquiring equipment ahead of demand. So, if Aramco decides to expand the number of fleets or stages, we will be prepared. To answer your question more directly, I anticipate that by Q2 we will achieve a steady state, and we might add another fleet in Q3 or Q4. The run rate for our stages per quota should become evident in Q3.

I was curious about some of the supply chain concerns you see. It seems you've addressed the importance of staying ahead of customer needs. Initially, one of the keys to unlocking Jafurah was addressing these supply chain issues. What specific areas are you currently focused on, and how do you manage those challenges?

Okay. I mean, obviously, without giving away some of the competitive stuff, right? But we planned it from the very early beginning to ensure that we have local sand, adequate supplies of trees, plugs, etc. So all this we aligned with partners, with people here from the U.S., and we ensured that we play what we call frac on paper that all this is ready on time and without any block, if you like, on logistics or anything to be delivered on time. So all this is basically solved. And that's why I keep saying it's just we are at Aramco, our client, whenever they ask for additional stuff, we just require a couple of weeks to be ready. And that's how ready we are with all our partners. Obviously, with the cost control, everybody plays ball with that strategy that this is the new paradigm. There are a lot of stages to be executed and everybody is aligned with us. So I think I'm trying not to give away any of the competitive advantage that I can. But we solved all the issues of any kind of blockade from tariff, supply chain, logistics, whatever. And that's why we feel very confident that we will be able to deliver the stages that Aramco wants with the same profitability that we have in Q4.

It sounds like staying in front of the customer is really crucial here, kind of one of the steps. If I could just squeeze in one last question. You talked about your sights are on much higher activity levels. You talked about moving beyond the $2 billion target. Could you just expand a little bit more on that? Maybe kind of the key areas where you think are going to feed into that greater than $2 billion number? You mentioned a number of tenders coming out in Saudi. I'm sure that's part of it. I know Kuwait. But if you could just sort of expand a little bit more on kind of your medium-term targets and your medium-term outlook, please?

So obviously, if I go back to people that are following the story from the beginning, we had originally said our target is to become $2 billion revenue, and we're very happy with that. Obviously, now it's done. So you cannot have a target that is like next – very simple to achieve. So we looked at all the backlog, the contracts, where we want to be, the investment profile, and we see very easily we can double the company from where it is today in a couple of years. With the contracts that we have tendering, today we tender almost $2 billion to $3 billion of tenders across the region. Most of them are submitted, and now we are waiting for the results from the customer. The majority of it is, I would say, outside Saudi, the lion's share. So all this – when you don't have the business, then it becomes additional to us. If you have the contract and you are continuing, that's basically what we call must-have, which is basically you continue to have the same backlog that you have. The additional work, which is the majority of the tenders that we bid for, we are waiting on the results. And as I said, I am extremely optimistic that we're going to win more than our fair share, and that's going to ensure that we're going to reach double the size of the company in a couple of years.

Our next question is from Saurabh Pant with Bank of America.

Just a quick follow-up, Sherif, if you don't mind on Jafurah, like Dave was asking. I think in your prepared remarks, you were talking about much more optimization to be achieved. I know you can't disclose everything that you're doing. But to the extent you can, Sherif, just maybe talk to what you are doing as the project ramps up, where those incremental efficiencies optimization are going to come from? And how should we think about just the margin profile on Jafurah as it fully ramps up, normalizes relative to the rest of your business? Just some color on that?

Thanks. The Permian and U.S. shale provide a clear example of how cost initiatives and technological advancements have evolved. We have a lot of that in place, but we know there's more work to be done. I want to share insights while maintaining our competitive advantage. We believe we can increase the number of stages completed each day and optimize various processes like rig setup, perforation, and transitions between stages. Achieving a 20% efficiency gain would significantly impact our margins. Our goal is to establish a smooth operation at Jafurah, leveraging the extensive infrastructure we have. We're developing a new base in SPARK, which will incorporate advanced technologies, including AI for maintenance and reliability enhancements. With plans to complete 80,000 to 100,000 stages over five years and hosting all our partners in our state-of-the-art facility at Jafurah, we can enhance reliability and efficiency, ultimately lowering costs which will reflect positively on margins. We are at the start of this journey, and we expect our facility to be ready by Q3. As we get our full fleets operational, we will be able to maintain a steady operation, leading to improved margins over time.

Interesting. Okay. No, it's really fair. And then the second one for me, Sherif, is on the Kuwait side of things. I know you talked about that in your prepared remarks and COGS; it looks like it was a great success for the industry as a whole. The $8 billion to $10 billion upstream spending that you mentioned, obviously, is the official target. How critical is that? I know this was a country that was pretty small for you. You just entered the country, but now it's set to become the second largest. How quickly can Kuwait ramp up for NESR in particular? And then the tenders we are talking about, what's the line of sight to those being awarded? And how quickly can that move the needle for NESR?

The spending has already taken place. The leadership in KPC and KOC is moving forward with it, and there's no more waiting. We currently have over 200 rigs operating in Kuwait, and the activity is ongoing. What's exciting for us is our potential for growth; we have the opportunity to easily double our business size in Kuwait. The key factor is securing contracts because we cannot operate without them. We've already won a few contracts and are awaiting the results of some tenders we've submitted. We are also in the process of submitting two more tenders. All of these contracts will be awarded this year, with some expected by the end of Q1 and others in Q2 and Q3. We will know all the details by 2026, and these contracts will last between 5 to 7 years. Once we have the contracts, we can mobilize quickly since we prepare our equipment in advance, allowing us to respond faster than the usual 6 to 8 months.

Our next question is from Josh Silverstein with UBS.

It's clear there's a lot of growth potential for NESR across the region. Can you talk about what level of investments you might need to make to support these higher activity levels? You mentioned what the CapEx would be this year, but does this have to keep ramping going forward? Are there new technologies you have to develop? And maybe how do acquisitions play into the strategy?

So look, I mean, CapEx, as we planned it, is we have, as Stefan mentioned, detailed, $150 million, $180 million CapEx timeframe. So that's what we plan. I think we're going to be within that range over the next couple of years, right? So if we win much more than what we even think we're going to win, we might get this to $200 million, let's say, right? So we are very confident that the growth story, we can fuel it by taking full advantage of what's happening in the world. As we did with the frac, you can buy equipment at a much lower price, you can ship the stuff. We can capitalize on our local presence and make sure that we have the lowest cost equipment and supplies.

Got it. And then I know you provide some additional balance sheet details in the next quarter, but clearly, net debt continues to be brought down and now below $200 million. What's the right level of leverage for the company? And as you're potentially thinking about maybe a shift in some free cash flow allocation to shareholder returns, thoughts on preference of buybacks versus dividends?

So our stated goal is 1. So I would say from our perspective, having 1 or less is probably the right leverage. Right now, we're way below the 1, right? We said last quarter we're doing a plan right now to work out what the best returns are for shareholders, and we'll announce it next quarter. But everything is on the table, right, dividends, stock buybacks, etc., etc. But we'll announce this formally next quarter in the earnings call.

Our next question is from Derek Podhaizer with Piper Sandler.

Appreciate all the details on Jafurah, obviously, very exciting. But maybe, Sherif, if you could take some time to provide some color just around the state of the union in Saudi, maybe outside of Jafurah, just more of your legacy business, maybe some of the growth drivers there or the return to work that we've been hearing from a lot of your peers over the last couple of weeks? Just maybe some thoughts and color around how we can think about the shape of 2026 in Saudi ex-Jafurah?

I believe the insights from our peers and partners are accurate. Saudi Arabia is increasing its activities, and whatever the low point was in Q4 '25, Aramco is now adding rigs. I've heard this from various rig contractors. There is considerable bidding, and activity is on the rise. We expect to capture our share of this market. Aramco is likely to provide further information, perhaps during their earnings announcement. Ultimately, the number of rigs is increasing, with estimates ranging from 40 to 60 rigs in 2026. Our clients will determine how and when to proceed with these additions. Rig availability is not a concern, as the activation will depend on Aramco's timing. Additionally, there is a significant tender backlog related to what we call lump sum turnkey projects that Aramco is handling, contributing to the growth story, especially with a larger scope anticipated in the 2026 cycle. Companies are aware that in Saudi Arabia, being part of multi-service, multi-contract, and multi-segment operations is crucial. For instance, if your market share in cementing is 10%, and another 5 rigs are added, you would expect to maintain a 10% share on those additional rigs. Your actual share may vary based on quality and pricing, but that's the general expectation. We are projecting the same market growth that will align with any increase in rig count.

Great. Very helpful. I appreciate that. And then maybe, Stefan, it might be for you, but just hoping to put a finer point on the Q1 guidance and maybe the margin progression through the year. You talked about more muted seasonality. First quarter margins would represent a bottom and then work higher for the remainder of the year. It sounded like equally similar year-over-year. But if you could help put some guardrails around that, how we should think about the sequential contraction and then how we should think about the progression upwards as we move through the year?

We do not provide formal guidance, but we have shared quite a bit of direction today. The decrease in revenue from Q4 to Q1 due to normal seasonality will be smaller than usual, perhaps less than what our competitors have indicated. That's our position regarding Q1. Additionally, we expect our full-year margins for 2026 to be similar to those in 2025, starting lower in Q1 and gradually increasing by the end of the year. If we finished the last year at 21.3%, we anticipate it might be a percentage point lower at the beginning and a percentage point higher at the end.

Our next question is from Sherif Elmaghrabi with BTIG.

I think we've talked a lot about Saudi and Kuwait. So maybe a couple of questions on the rest of the market. There was not even $5 million of mobilization costs in Oman. Historically, that's one of your core countries. So I'm wondering if you're moving equipment out of the country and how you see opportunities there versus some of its neighbors?

You're discussing the structure costs. Without getting into the specifics of the contract we won, which we didn't previously have, there were some legacy issues from the prior owner or contract holder related to the regulations in Oman. These required us to accept those conditions and resulted in many unusable items. We decided to take a one-time write-off for all of that. So, that's the bulk of the expense. Additionally, we had to source all the equipment from outside since this was a scope of business we hadn't previously engaged in in Oman. The original company we acquired, Gulf Energy in Oman, didn't have this contract either. Looking back at the company, which started in 2006, this is entirely new for us. So this is a one-time situation, and that's all there is to it.

Got it. And then you also mentioned Syria, which was different. Any markets outside of NESR's existing footprint that we could see the company tender into this year or even over the next few years?

Yes, we are closely monitoring the situation in Syria, especially after the announcement involving Chevron, other companies, and the Saudis. We have been invited to participate, and we take pride in being a leader in the region. We have more than 75 Syrian employees working across different countries and are currently engaged in discussions with local leadership. As soon as we establish secure payment arrangements and logistics, we plan to initiate revitalization efforts for resources that once produced 500,000 to 600,000 barrels per day but are currently below 100,000. Starting operations in a country with prior production typically involves fixing wells and addressing issues like damaged wellheads. While we haven't included this in our forecast yet, we believe it could be very beneficial. We understand the region well, and with sanctions lifted, we aim to join our peers in entering Syria. Regarding Libya, there’s much excitement as they recently signed a $25 billion commitment with Total, and a recent bid round attracted several prominent international oil companies, all signing new agreements, which promises significant activity there. I was in Libya for a week interacting with government officials, including the Minister and the NOC Chairman, and there’s a large plan in motion where we play an integral role. We are already establishing a frac fleet there and have plans to triple the size of our operations in Libya. Our goal is to reach 2 million barrels per day, and as each project expands capacity, it prepares us for future production. Unlike some other countries, Libya is not bound by OPEC quotas and is therefore positioned to aggressively pursue that production target.

Our next question is from Tate Sullivan with Maxim Group.

Just a bigger picture question for Saudi Arabia. The Capital Market Authority recently eased restrictions on foreign investment. What are the pros and cons of this change for your business, please?

Well, absolutely nothing. I would say we are not on the Saudi Tadawul today. So the people that traded our stock, they trade on the NASDAQ, obviously. It opens up for a lot of the Saudi companies that you have a lot of foreigners that would love to buy into the market there. The market is extremely versatile in Saudi. A lot of people want to participate on Tadawul. You see BlackRock is always there. You see their FII. They're going to have an FII in Miami in March. It is just a very open culture and structure with a lot of investment outside. So for us, I would say there is no difference. But we are extremely happy with our position in Saudi, and I think it will be more and stronger.

And then last one for me is you did in your prepared remarks, I heard you mention critical minerals and a lot of news out of Saudi Arabia in the area about developing critical minerals. Do you have opportunities in that sector? Can you expand from OFS to that sector? Can you comment on that a bit?

Thanks. We are already involved in it. Our decarbonization and application initiative is progressing. During the Future Minerals Forum in January, we were proud to have our NESR lithium showcased. We were the first to display lithium in that context and are pleased to be part of the pilot program. Currently, we are conducting two pilots with Aramco and have plans to expand into bromine, magnesium, and other areas. There’s a lot of activity between Aramco and Maaden, the major mineral company in Saudi Arabia, which has been publicly announced. We are excited to be part of this journey, which has been a key focus for our company over the past four years. Personally, I am very enthusiastic about it. Although ESG concerns are taking a bit of a backseat, the mineral aspect is incredibly promising. Saudi Arabia has announced substantial ambitions in lithium and critical minerals, utilizing resources from aquifers and produced water. We are engaged in both aspects, particularly with our water strategy focused on produced water. Imagine the potential of extracting not only water but all the minerals from produced water; it reduces the energy costs associated with water production, effectively achieving multiple benefits at once. I am truly excited about this venture. We are proud to be first movers in this industry, and I believe it will play a significant role in our future business.

Our next question is from Jeff Robertson with Water Tower Research.

Sherif, can you share any color on the margin profile of the pipeline tender that you referenced? I think you said you have about $2 billion to $3 billion worth of tenders outstanding?

We don't obviously say that. I would say the best example is the company will remain with the same margin level that it is today.

Is most of those awards anticipated for 2027, 2028, and beyond? Or do you expect to see a significant impact in 2026?

All the awards will be in 2026, and everything will be granted this year. Most of the pipelines have had their prices submitted, and we are waiting for customers to announce the results. Customers in the Middle East are extremely professional and thorough in their evaluation process. They assess the technical aspects and assign scores based on performance, taking into account the capabilities of each company. If a competitor offers an unrealistic low price, that is taken into consideration. The customers will award multiple contracts, meaning there will be several winners. For instance, in a cementing contract in the UAE, they might select four or five winners from 15 bidders. The awards are based on price, in-country value, and technical quality. The top bidder might receive 25%, the second 20%, the third 15%, and so on, while the rest do not receive any business in that segment for five years. Local presence significantly impacts this process, as does the commitment to a long-term approach rather than a quick, opportunistic strategy. Most contracts will likely be awarded in the first and second quarters, with some in the third and fourth quarters, meaning that some of the business impact will be seen in the second half of the year. If contracts are awarded in the third or fourth quarters, their effects will be felt in the fourth quarter or the first quarter of 2027. This is why I believe we have clear multiyear growth potential. I am confident we can double the company by 2027, provided we win these contracts and start them, enabling us to operate at a much higher run rate than we previously anticipated.

In light of your comments about spending across the region to support production capacity goals, do you see the pipeline or maybe the tender volume increasing from where it is today over the next several years?

Yes. I would say '25, '26 would be one of the highest tender values ever in the Middle East. Again, the way most of the clients, and I repeat, the NOCs are very smart clients. So the way they do it is they want to secure their capacity, and they know they take advantage of what's happening. So '25 was soft in the U.S. They tendered a lot of stuff. They know that they're going to get a much better price and they lock this for 5 years. Most of the contracts that we got in '25 are for 5 years, so they are into 2030. The contracts that we bid and we are going to get awarded or and the others as well in '26 will be for 5 to 7 years. So meaning that we see where we're going to be until 2030, 2031. There is no doubt there. The backlog is there. If you get the backlog properly, you get that. Again, the clients are very smart. Why wouldn't you bid when you know that the service industry is soft? You get a better price, you get the capacity that you want, and you get the work that you need, right? You don't bid when the whole market is in the upside mode. I think the Middle East is taking full advantage, and they're smart about it. We're very happy to be there. I think all the peers as well, the same. The pipeline will be solid until, I would say, 2031, 2032.

This will now conclude our question-and-answer session. I would like to turn the floor back over to Sherif for closing remarks.

Thank you very much. Thanks for everybody for listening. Very excited time. As Stefan said, '26 will be the best year ever from a growth and from numbers. So we're extremely, extremely happy to be there. Thank you so much for listening. Thank you.

Thank you. This does conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.