Nabors Industries Ltd. (NBR): PESTLE Analysis [Nov-2025 Updated]

You're looking at Nabors Industries Ltd. (NBR) in 2025, and the core takeaway is that the drilling market is splitting in two: one side is driven by macro-risk, the other by technology. Geopolitical instability and inflationary pressure on steel and labor are squeezing operating margins, but the premium day rates from their high-spec, digitally-enabled fleet are creating a crucial buffer. Sustained global crude oil price stability above $80/barrel is the financial floor for growth, but the real upside comes from technology-specifically, the adoption of proprietary automation software like SmartSLIDE that drives efficiency and meets client-driven emissions targets. It's a high-stakes trade-off where only the most efficient, ESG-compliant assets will defintely survive.

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Political factors

Geopolitical instability in the Middle East and Russia drives short-term oil price volatility.

You know that drilling is a capital-intensive, long-cycle business, so short-term oil price swings can really mess with your clients' spending plans, which means fewer contracts for Nabors Industries Ltd. (NBR). The ongoing conflicts in the Middle East and the Russia-Ukraine war are the primary drivers of this volatility right now.

For example, in November 2025, Brent crude was trading near $64 a barrel, while West Texas Intermediate (WTI) crude was below $60, reflecting a market balancing a potential supply surplus against geopolitical disruption. Attacks on Russian energy infrastructure, including drone strikes on at least 28 Russian refineries over a three-month period, have reduced Russia's refining capacity by up to 20%, which tightens global supply and pushes prices up. Conversely, a forecast from Goldman Sachs Research projects Brent crude will average about $76 per barrel in 2025, trading in a range of $70-$85, which is a manageable range for most exploration and production (E&P) companies. You need to watch the daily headlines, but the long-term trend for E&P capital expenditure remains positive due to the AI-driven demand for natural gas. That's your cushion.

US federal leasing policy changes affect onshore and offshore drilling permit timelines.

The political environment for US drilling has shifted significantly in 2025, largely due to the 'One Big Beautiful Bill Act' (OBBB) signed in July. This new law is a clear win for oilfield services companies like Nabors.

The most immediate change is the extension of the term for an approved Application for Permit to Drill (APD) on federal lands. It was three years, but now it's a single, non-renewable term of four years, effective September 30, 2025. A longer permit life gives your clients more certainty, making them more likely to commit to new drilling programs. Also, the Bureau of Land Management (BLM) must now make lands nominated by the industry available for leasing within 18 months, and the $5 per acre nomination fee has been eliminated.

Here is a quick summary of the key US leasing policy changes in 2025:

• APD term extended from 3 years to 4 years.
• BLM must offer nominated lands for lease within 18 months.
• Noncompetitive leasing for oil and gas has been restored.
• Nomination fee of $5 per acre has been eliminated.

For offshore work, the Department of the Interior has proposed up to 34 potential offshore lease sales over the next five years, covering around 1.27 billion acres in the Gulf of Mexico, Alaska, and the Pacific. This provides a clear, long-term pipeline of potential deepwater work. That's a huge boost to visibility.

Increased regulatory scrutiny on methane emissions from drilling operations.

Methane emissions are now a political hot potato, and the US government is putting a price on it. The Environmental Protection Agency (EPA) is implementing the Waste Emissions Charge (WEC), commonly called the 'methane fee,' which is a direct cost you need to factor into your models.

The fee for excessive methane produced in 2025 is set to be $1,200 per ton, rising to $1,500 per ton by 2026. This charge only applies to facilities that emit more than 25,000 tonnes of CO2 equivalent per year. The EPA estimates the total industry cost could reach $750 million in 2025. While Nabors is a drilling contractor and not the primary operator, its clients will demand rigs with advanced emissions-reducing technology-like Nabors' smart controls-to avoid this fee. If your rigs can help E&P clients stay below the threshold, you have a competitive advantage. The EPA projects the rule will reduce cumulative methane emissions by 1.2 million metric tons through 2035.

To be fair, the fee faces a high chance of being repealed or revised by Congress using the Congressional Review Act (CRA), but you defintely can't ignore it today.

US-China trade tensions impact global supply chain costs for rig components.

The renewed US-China trade tensions in 2025 are not just about tariffs on oil; they are fragmenting the global supply chain, which directly impacts the cost of your rig components and maintenance.

Trade disputes force companies to reconfigure logistics, leading to higher operational costs for the entire petroleum industry. The broader economic risk is significant: a severe escalation could spike US inflation to 5.8% in 2026, which would increase the cost of capital and labor for Nabors. You are already seeing the trade war's effect on energy flows, with US oil exports to China shrinking to just 1% of China's total imports, a sharp drop from the 217,000 barrels daily in 2024.

This political friction is a direct threat to your capital expenditure (CapEx) budget. The cost of steel, specialized electronics, and other rig components sourced globally will continue to see inflationary pressure. Container shipping volumes between US and Chinese ports have already fallen by 31% since tariffs escalated, a clear indicator of the disruption in global freight flows. Your action is clear: diversify your supply chain for critical rig parts now, or pay more later.

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Economic factors

Global Crude Oil Price Stability and US Rig Count

The core economic challenge for Nabors Industries Ltd. (NBR) in 2025 is the stark disconnect between the needed oil price for sustained drilling and the prevailing market forecasts. You need global crude oil prices to be stable above $80 per barrel to drive the capital expenditure (CapEx) growth that fuels the US rig count. The reality is much softer.

As of October 2025, the West Texas Intermediate (WTI) crude oil price is trading around $58.90 per barrel, and the U.S. Energy Information Administration (EIA) forecasts Brent crude to average approximately $66 per barrel for the full year 2025. That is well below the average break-even price of $61 per barrel for large US exploration and production (E&P) companies, and even further below the $66 per barrel needed by smaller producers. This price environment is forcing a contraction.

The market reaction is clear: the total active US rig count dropped to 547 rigs as of October 10, 2025, representing a 7% decline year-over-year. E&P clients are cutting back, with independent E&P companies planning to reduce their capital expenditures by around 4% in 2025. Nabors' own outlook for its Lower 48 average rig count in Q4 2025 is a stabilized range of 57 to 59 rigs, reflecting this cautious environment.

Inflationary Pressure on Operating Margins

Inflationary pressure on key drilling inputs is squeezing operating margins, even as dayrates for high-specification rigs remain sticky. This is a classic cost-price pinch. The primary driver of this cost inflation is the impact of US tariffs on imported steel and other consumables.

Drilling and completion costs for US Lower 48 tight oil wells are projected to rise by 4.5% year-over-year in Q4 2025. The most significant factor is the cost of Oil Country Tubular Goods (OCTG), which are expected to be 40% higher year-over-year in Q4 2025, adding approximately 4% to total well costs. Nabors' own US Drilling segment is feeling this directly.

Here's the quick math on the margin squeeze in the Lower 48:

The guided drop in daily adjusted gross margin from $13,902 in Q2 2025 to approximately $13,000 in the Q4 2025 outlook is a direct, quantifiable result of this cost inflation and repricing pressure in the oil-focused basins.

US Federal Reserve Interest Rate Policy

The US Federal Reserve's interest rate policy is one of the few positive economic levers for Nabors' E&P clients, as it directly impacts their cost of capital. You are seeing a shift to an easing cycle in the latter half of 2025.

The Federal Open Market Committee (FOMC) has been reducing the benchmark federal funds rate. Following a cut in September, the Fed lowered the target range again in October 2025 to 3.75% to 4%. This lower borrowing cost is critical for E&P firms that rely on debt financing for their capital programs. A lower cost of capital makes new drilling projects more economically viable, especially in a low-price environment.

For Nabors itself, a lower rate environment supports its aggressive debt reduction strategy. The company's net debt was reduced to approximately $1.67 billion in Q3 2025 following the sale of Quail Tools, and lower interest rates help reduce the carrying cost of the remaining debt load.

Stronger US Dollar (USD) and International Headwinds

A persistently strong US Dollar (USD) creates currency translation headwinds that can erode the reported value of Nabors' substantial international earnings. The International Drilling segment is the company's primary growth engine and profit center in 2025.

Nabors is heavily exposed to non-USD revenue, most notably through its joint venture with Saudi Aramco (SANAD), which accounted for approximately 31% of the company's consolidated operating revenues in 2024. While the International segment is operationally strong, a stronger USD means that when foreign currency earnings are translated back into USD for financial reporting, the reported revenue and Adjusted EBITDA figures are lower than they would be otherwise.

Despite this headwind, the international segment is performing exceptionally well, which underscores the demand for Nabors' high-specification rigs globally.

• Q3 2025 International Drilling Adjusted EBITDA: $127.6 million.
• Q4 2025 International Daily Adjusted Gross Margin Outlook: $18,100 - $18,200.
• Q4 2025 International Average Rig Count Outlook: approximately 91 rigs.

This international strength is defintely a necessary counterweight to the weakness and margin pressure seen in the US Lower 48 market.

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Social factors

The social landscape for Nabors Industries Ltd. is defined by a deep tension between the industry's traditional labor model and the accelerating demand for digital skills, all while facing intense scrutiny over safety and environmental impact from investors and local communities. Your strategic focus must be on transforming the workforce and proactively managing local opposition to protect your license to operate.

Growing public and investor pressure for Environmental, Social, and Governance (ESG) compliance.

Investor sentiment is defintely shifting, making ESG performance a critical driver of capital access and valuation for Nabors Industries Ltd. The company explicitly acknowledges that negative public perception of the fossil fuel industry and a focus on ESG could negatively affect its ability to raise capital and its stock price.

This pressure is translating into tangible investment: Nabors is actively investing in its Energy Transition portfolio, which includes venture opportunities in areas like geothermal, hydrogen, energy storage, and carbon capture. This is a necessary move to align with major institutional investors who are integrating ESG metrics into their decision-making process.

Here's the quick math on the capital risk:

• Nabors' long-term debt as of March 31, 2025, was approximately $2.685 billion.
• A higher cost of capital due to poor ESG perception directly impacts the servicing of this debt.
• The company's commitment to ESG is tied to its core business, leveraging its technology for energy efficiency and emissions reduction for customers.

Shift in talent acquisition toward digital and automation skills, away from traditional field labor.

The move toward advanced drilling automation is fundamentally changing the required skill set for Nabors' workforce. The company is actively repositioning its human capital strategy to focus on 'Talent, Technology, and Transition.'

Traditional field roles are being replaced or augmented by high-tech positions, which is why Nabors is recruiting for roles such as 'Robotics Development Engineer III' and 'Senior Full Stack Developer' in November 2025. This shift is necessary to support technologies like RigCLOUD® and advanced drilling automation capabilities.

The company must reskill its existing employees while competing for top-tier digital talent in a tight labor market. That's a tough recruiting challenge.

The focus areas for new talent acquisition include:

• Software Development and Data Science.
• Rig Automation and Controls Engineering.
• Energy Transition Technologies (e.g., geothermal, carbon capture).

Community opposition (NIMBY) to new drilling sites, especially in densely populated basins.

Nabors Industries Ltd.'s significant presence in the U.S. Lower 48, which averaged 61 rigs working in the first quarter of 2025, exposes it directly to 'Not In My Backyard' (NIMBY) opposition.

While Nabors itself is not always the direct target, the industry faces intense community pushback in key operational areas like the Permian Basin related to noise, flaring, and water use. For example, in Texas, objections to flaring permits due to constant noise are a documented issue as of September 2024, impacting local residents.

Furthermore, the high-volume water demands of drilling are creating 'water wars' in Texas, with local residents in June 2025 protesting proposals to extract groundwater for industrial use, a conflict that can delay or halt drilling permits.

Managing these local relationships is crucial, particularly since Nabors' U.S. Drilling segment generated $255.4 million in operating revenues in Q2 2025. Failure to address community concerns translates directly to operational delays and increased costs.

Demand for a definitely safer and more automated work environment to reduce incident rates.

The industry's inherent risks mean safety performance is a core social factor and a key metric for investors. Nabors is committed to a 'Journey to Excellence' and 'Mission Zero' to improve its safety culture.

Automation is the primary tool for reducing human exposure to risk. Nabors is deploying advanced rig systems like Red Zone Robotics (RZR and RZR-Lite) to improve safety, speed, and efficiency by removing personnel from high-risk areas.

The company's most recently reported Total Recordable Incident Rate (TRIR) was 0.41 in 2021, a significant improvement from 0.49 in 2020. This rate is substantially better than the 2023 private industry average TRIR of 2.4 cases per 100 full-time equivalent workers reported by the Bureau of Labor Statistics, highlighting the competitive advantage of their safety-focused automation strategy.

The table below summarizes the safety performance and automation drive:

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Technological factors

Adoption of Nabors' proprietary SmartSLIDE and SmartNAV drilling automation software increases efficiency

Nabors Industries is defintely leaning into automation, and the adoption of their proprietary drilling software is a major technological driver. You see this most clearly in the efficiency gains they deliver to clients, which directly translates to lower costs per well.

The SmartSLIDE® automated slide drilling and SmartNAV® directional guidance systems are core to this. A strategic collaboration announced in February 2025 with ProDirectional is expanding the reach of these tools, allowing ProDirectional to offer remote steering services to their customers who have an active license for Nabors' solutions. This is how you scale technology adoption quickly.

The proof is in the performance data from Q3 2025. On one operator's first deployment of a Nabors SmartRig®, the full suite of Performance Tools, including SmartNAV®, was used. The result? The four-well pad was delivered 25 days ahead of schedule, averaging 6.35 days ahead for each well. In another case, a well surpassed its best offset by 5 days, finishing 10.6 days ahead of schedule. That kind of time saving is a massive competitive advantage.

• SmartSLIDE®: Cuts costs per well through reduced slide hours.
• SmartNAV®: Delivers precise wellbore placement using real-time downhole data.
• SmartDRILL®: Executes optimal connections, eliminating manual variability risk.

Transition to higher-specification, digitally-enabled rigs (AC rigs) demanding premium day rates

The market is bifurcating; clients want the best, most efficient rigs, and they are willing to pay a premium for them. Nabors' strategy is to transition its fleet to higher-specification, digitally-enabled Alternating Current (AC) rigs, which command better day rates and margins. Here's the quick math: the Lower 48 daily adjusted gross margin for the U.S. Drilling segment in Q2 2025 was approximately $13,300, but the International Drilling segment's daily adjusted gross margin was higher at approximately $17,534, driven by the high-spec international fleet. That difference shows the value of high-spec assets.

As of December 31, 2024, Nabors' marketed U.S. fleet already consisted of 158 AC land rigs, showing a strong foundation. Internationally, the SANAD joint venture with Saudi Aramco is key. In Q2 2025, the joint venture deployed its 12th newbuild rig, with two more scheduled for the second half of 2025. These are high-spec PACE® series SmartRigs® that are setting milestones, like drilling three four-mile lateral wells in the Bakken formation. These rigs are working under multiyear contracts, securing future revenue at premium rates.

Development of alternative power sources (e.g., natural gas, grid power) to reduce diesel consumption

Reducing diesel consumption is both an environmental and a cost-saving imperative. Nabors has set a clear target to reduce its carbon intensity by 10% by the end of 2025. To get there, they are actively deploying alternative power technology, which is a major technological shift in the drilling industry.

A multi-million dollar agreement with e2Companies, announced in late 2024, is accelerating this. Nabors is purchasing mobile power utility stations (Virtual Utility®) that use natural gas-fired generators and lithium iron phosphate batteries to create on-site microgrids, replacing traditional diesel engines. Plus, Nabors has already outfitted 20 rigs in key basins like Texas, North Dakota, and Argentina to be compatible with highline power, meaning they can run directly off the electrical grid or a microgrid.

This shift isn't just about optics; it's about hard numbers. The R3Di® system, a core component of the Virtual Utility®, is verified to save approximately 40,000 tons of CO2 emissions per megawatt over its lifetime compared to conventional power systems. That's a powerful metric for clients focused on environmental, social, and governance (ESG) performance.

Increased use of data analytics and machine learning to predict equipment failure and optimize drilling paths

The future of drilling is digital, and data analytics is the engine. Nabors is leveraging its RigCLOUD® platform, which acts as the digital infrastructure to integrate various applications and deliver real-time operational insight. This is where machine learning (ML) comes in to predict issues before they cause costly downtime.

In Q1 2025, Nabors expanded its strategic alliance with Corva AI, integrating their AI-driven analytics directly into the RigCLOUD® platform. This alliance enhances real-time data processing and predictive insights, which is critical for optimizing drilling paths and predicting equipment failure. Predicting a pump failure even a few hours ahead can save hundreds of thousands of dollars in non-productive time (NPT).

The financial impact of this technological focus is visible in the Drilling Solutions segment, which houses these digital tools. The segment's Adjusted EBITDA surged to $76.5 million in Q2 2025, a significant jump from $40.9 million in Q1 2025 (though the Parker Wellbore acquisition contributed materially to this increase). This segment's gross margin was strong, topping 53% in Q2 2025. That kind of margin expansion shows the high value and low marginal cost of selling software and analytics. The technology is driving high-margin revenue growth.

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Legal factors

The legal landscape for Nabors Industries in 2025 is characterized by a tightening regulatory environment in its core US market and complex, high-stakes international contract management, particularly concerning its joint venture growth. The key challenge is translating broad environmental and safety compliance into quantifiable, non-disruptive operational costs.

Stricter US state-level regulations on fracking and water usage in key basins like the Permian.

New regulations from the Railroad Commission of Texas (RRC) effective June 1, 2025, significantly increase the legal and operational burden on Nabors Industries' clients in the Permian Basin, which indirectly affects rig demand and day rates. These new guidelines for saltwater disposal wells (SWDs) are a direct response to rising reservoir pressure, environmental risk, and induced seismicity concerns.

The RRC has doubled the required Area of Review (AOR) for new or amended SWD permits from a quarter-mile to a half-mile around injection sites, forcing operators to assess more older, unplugged wells. This due diligence requirement increases the time and cost for permitting. For oil producers-Nabors' customers-these stricter wastewater regulations are expected to increase operating costs by 20-30%. While Nabors is a drilling contractor, not a disposal operator, this cost pressure on their clients directly limits their ability to pay premium day rates, impacting the Lower 48 daily adjusted gross margin, which is forecasted at approximately $13,000 for Q4 2025.

Compliance costs associated with new international labor and safety standards in foreign markets.

While global standards like ISO 45001 (Occupational Health and Safety) are becoming more stringent, Nabors Industries' own 2025 filings indicate that they do not anticipate compliance with currently applicable environmental laws and regulations will significantly change their competitive position, capital spending, or earnings during 2025. This suggests a mature, embedded compliance program. Still, operational shifts in foreign markets carry measurable cost impacts.

For example, the International Drilling segment's Q4 2024 daily adjusted gross margin of $16,687 reflected incremental costs associated with rig start-ups and suspensions in key areas like Argentina and Saudi Arabia. These costs are often tied to local labor law compliance, training to meet host-nation safety mandates, and the expense of rig certifications. The company is actively mitigating these costs, targeting $40 million in cost synergies for 2025 from the integration of the Parker Wellbore acquisition, which includes a large casing running contractor in the Middle East. That's a clean offset.

Potential for increased litigation related to carbon capture and storage (CCS) site development.

Nabors Industries' focus on energy transition technologies, including drilling services for Carbon Capture and Storage (CCS), exposes them to a new, escalating category of legal risk. Litigation in this sector is rising sharply in 2025, primarily centered on property rights and environmental impact liability.

Key legal flashpoints include:

• Eminent Domain Challenges: In November 2025, a lawsuit was filed in Louisiana challenging state laws that grant CCS developers the right to take private land for CO2 pipeline projects, raising constitutional property rights issues.
• Project Approvals: Campaigners launched a judicial review in the UK in August 2025 against government approvals for a major CCS project, setting a precedent for environmental legal challenges.

The risk for Nabors is indirect but critical: if CCS projects face protracted legal delays, the demand for their specialized drilling services in this high-growth segment will slow, jeopardizing future revenue streams from their technology-focused Rig Technologies and Drilling Solutions segments.

Complex international contract law governing rig movements and cross-border operations.

Nabors Industries' global operating model, particularly its massive joint venture with Saudi Aramco, SANAD, is inherently exposed to the complexities of international contract and maritime law. The company's full-year 2025 capital expenditures are forecast at approximately $770 million to $780 million, with $360 million directed to the SANAD newbuild program alone-a huge capital commitment tied to international contracts.

The core legal risk is ensuring contract enforceability across multiple jurisdictions, especially when moving assets. There is no single international body of law governing the movement of drilling rigs, creating a 'hodgepodge' of potential applicable laws from the flag of the vessel, the flag of the rig, or the law of the destination nation.

To mitigate this, contracts for Nabors' International Drilling segment, which is deploying an additional three SANAD newbuild rigs in the second half of 2025, must explicitly define:

• Governing Law: Which country's legal framework applies to the contract.
• Jurisdiction/Arbitration: The agreed-upon forum for dispute resolution, often using the New York Convention to enforce arbitration awards.
• Cabotage Laws: Compliance with local laws that restrict foreign-flagged vessels or rigs from operating within a nation's territorial waters.

The company's accounting policy reflects this operational reality: costs incurred to relocate rigs and other drilling equipment to areas where a contract has not been secured are expensed as incurred. This means every rig move is a direct, non-capitalized cost that must be managed tightly against a complex legal backdrop.

Nabors Industries Ltd. (NBR) - PESTLE Analysis: Environmental factors

Increased focus on reducing the operational carbon footprint of the drilling fleet.

The pressure to decarbonize is real, and it's hitting the drilling sector hard. Nabors Industries Ltd. is responding by aggressively deploying technology to cut its operational carbon footprint (Scope 1 and 2 emissions), which totaled approximately 1,116,000,000 kg CO2e in 2024. That's a big number, so the focus is on intensity-reducing emissions per foot drilled-to show real progress to clients and investors.

The company's strategy centers on the Nabors Energy Transition Solutions (NETS) portfolio, which offers customers a way to reduce their own Scope 3 emissions. This includes proprietary engine management controls, energy storage systems, and dual-fuel offerings that allow rigs to operate on a blend of diesel and natural gas. Nabors Drilling USA already exceeded its Scope 1 greenhouse gas (GHG) emissions intensity reduction target set against a 2020 baseline. It's a technology race now, not just a price war.

Regulations mandating the reduction of freshwater use in drilling and completion activities.

Water scarcity is a growing operational risk, especially in the arid US shale basins where Nabors has a significant presence. New regulations are translating this environmental concern into a clear, measurable business mandate. For example, the Colorado Energy and Carbon Management Commission finalized new rules in March 2025 that mandate a reduction in freshwater use.

These rules establish a phased-in requirement for oil and gas development permitted after January 1, 2026, to use a minimum percentage of recycled produced water or an acceptable alternative in downhole operations. This pushes the cost and complexity of water management directly onto operators, and by extension, their drilling contractors. Nabors' focus on responsible water stewardship, including wastewater recycling and reuse where feasible, is a necessary defense against this regulatory trend.

Here's the quick math on the Colorado mandates:

Risk of forced asset write-downs due to accelerated energy transition scenarios.

The risk of stranded assets-equipment that becomes economically obsolete before the end of its physical life-is a major concern for drilling contractors. A sustained drop in oil prices, like the one that saw WTI crude trade at $58.29 per barrel and Brent crude at $62.67 per barrel in November 2025, amplifies this risk. If an accelerated energy transition scenario plays out, older, less-efficient rigs could be forced into early retirement, leading to non-cash impairment charges.

General industry analysis confirms that the transition to net zero will have serious impacts on impairments and asset write-downs for oil and gas companies. Nabors' own 2024 10-K, filed in February 2025, acknowledges that regulation of greenhouse gas (GHG) emissions and climate change could negatively affect the business. What this estimate hides is the potential for a sudden, market-driven devaluation of the older, Silicon-Controlled Rectifier (SCR) rig fleet, even if management does not anticipate compliance with current laws will significantly change earnings during 2025.

Opportunity to market high-efficiency rigs that meet client-driven emissions targets.

The flip side of the asset write-down risk is the opportunity to capture premium pricing for high-spec, low-emissions rigs. Major oil and gas companies are now demanding rigs that can help them meet their own Scope 1 and Scope 3 emissions reduction goals. Nabors' advanced fleet and technology solutions directly address this client-driven demand.

The high-specification PACE® series SmartRigs® are a prime example. These rigs are securing multiyear contracts and are expected to contribute materially to the International Drilling segment earnings during the second half of 2025 and beyond. The underlying value proposition is clear: more efficient drilling means less time on location and less fuel burned.

Key technological differentiators Nabors is marketing include:

• Corva-powered predictive drilling that uses data to reduce fuel use.
• Energy storage systems (ESS) that capture and reuse braking energy, cutting fuel consumption.
• The ability to use high-line power, which is a lower carbon alternative to diesel engines.

This is where the technology segment, Drilling Solutions, shines, with its adjusted EBITDA reaching $76.5 million in the second quarter of 2025. The high-efficiency rig isn't just a cost-saver; it's a revenue driver.

Next step: Operations and Sales must defintely quantify the average fuel reduction percentage for the PACE-X fleet by the end of Q4 2025 to better anchor the sales pitch.