Income Taxes |
6 Months Ended |
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Jun. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | NOTE 11 — Income Taxes The Company recognized income tax expense of less than $0.1 million for the three and six months ended June 30, 2026, resulting in an effective tax rate (“ETR”) of 0%, compared to a deferred income tax benefit of $1.6 million and $1.2 million based on an annualized ETR of 2.0% for the three and six months ended June 30, 2025. The 0% ETR for the current quarter reflects the Company’s net loss position, for which a full valuation allowance has been established against deferred tax assets, as the Company has determined it is more likely than not that such assets will not be realized. Accordingly, no tax benefit has been recognized on current-period losses. The decrease in the ETR compared to the prior year period is primarily attributable to the establishment of a full valuation allowance on deferred tax assets after the Company moved out of a deferred tax liability and into an overall deferred tax asset position due to non-deductible book impairments during 2025. Tax Receivable Agreement In March 2025, due to the Company’s decision to pause new purchase commitments for Project Permian’s long-lead equipment and commencement of a value engineering exercise to determine project cost reductions and better understand Project Permian’s expected economic feasibility, the Company determined it was not more likely than not that its deferred tax assets subject to the Tax Receivable Agreement (“TRA”) would be realized and therefore reduced the TRA liability to zero as payments under the TRA were not considered probable. Accordingly, in March 2025, the Company recognized a $21.3 million reduction in the Tax Receivable Agreement liability, which is recorded in Change in Tax Receivable Agreement liability in the condensed consolidated statements of operations for the six months ended June 30, 2025. On May 12, 2025, pursuant to its rights under the TRA, the Company delivered to the agent of the TRA holders notice of the Company’s intent to terminate the TRA (the “Early Termination Notice”). No early termination payment was payable to any TRA holder. The Early Termination Notice became final and binding on June 12, 2025.
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