Protecting the Environment

Sustainability has always been at the core of our operations.

Protecting the environment

Sustainability has always been at the core of our operations because we believe our technology not only equips customers to reduce operational and environmental risk, but also empowers them to be efficient, thereby reducing their overall carbon footprint.

As the market becomes increasingly focused on the energy transition, we are aligning our capabilities and dedicating R&D resources to further develop differentiating technologies.

As we have consistently done over the last several decades, we are committed to bringing higher levels of innovation in sync with the needs of our customers.

It is ingrained in our culture of the Power of e™ and exemplified by our Green by Design™ solutions that link a focus on sustainability across our entire product portfolio.

These technologies are helping our customers to reach their carbon reduction targets, while lowering their capital and operating expenses.

Power of e™ — The Dril-Quip Story

The Power of e™ can mean many things . . .

• evolutionary
• empowering
• enabling
• exceptional
• effective
• efficient

Our e-Series products are industry game-changers. When used in combination, they:

• Eliminate significant hardware
• Effectively and efficiently eliminate up to two weeks of rig time
• Collectively provide savings of up to $5 million per well
• Lower carbon emissions by reducing manufacturing, transportation and operating days

It's a testament to our commitment to driving environmental sustainability and why we will be able to meaningfully contribute to UN SDG 7 "Affordable and Clean Energy." And, it is why Dril-Quip products are Green By Design™.

Our Trees Are Greener™

Our Green By Design™ products were deliberately engineered to eliminate hardware and materials, reduce installation time, and minimize transportation, which helps our customers lower their carbon footprint.

An excellent example of how we put our Green By Design™ approach into practice is our revolutionary VXTe™ Vertical Subsea Tree System. The VXTe™ is a game-changing technology that completely rethinks the entire well completion sequence, saving our customers significant time and money and reducing operational and HSE risks.

Dril-Quip^® VXTe™ System:

• Dramatically improves subsea well break-even economics, resulting in millions of dollars of savings per well
• Reduces the carbon footprint by more than 1,000 metric tons by removing the 40 tons of hardware required in conventional vertical tree installations
• Improves workplace safety by reducing more than 30,000 HSE touchpoints

At Dril-Quip, health and safety come first.

Dril-Quip's success is built upon the health, safety and well-being of our employees, stakeholders, and global community. In alignment with our Goal Zero initiative, we strive to improve our HSE policies to minimize safety risks and hazards.

Goal ZERO Initiative

Goal ZERO is our global health, safety, and environmental initiative, which is designed to ensure a robust and protected work environment for our valued teammates.

Dril-Quip made great progress on our vision of Goal ZERO in 2021. A full 42% of our training programs is focused on safety awareness and on-the-job safety, which stands as a further testament to our commitment to our employees.

In 2021, our average health, safety, and emergency training hours exceeded 20,000. The majority of our direct operations are ISO 14001- and ISO 45001-certified.

All ISO Certification audits ended with ZERO major findings.

Our Goal Zero initiative was founded in 2019 and addresses:

Leadership, People, Processes, Technology, and Risk Management

Even before Goal ZERO, we were fully committed to ensuring a healthy, safe, and enjoyable working experience for all Dril-Quip teammates.

Since 2015, we have steadily tracked our progress and are pleased to report a year-over-year reduction for almost all incident and fatality rates across several key performance indicators (KPIs).

Since 2015, we achieved a 72% reduction in the total recordable incident rate (TRIR) and our Near-Miss Frequency Rates (NMFR) are down 78%.

Biodiversity

Dril-Quip understands the importance of biodiversity conservation and we support it by imbedding strong business controls to enhance our business execution. We are committed to the highest standards for the health and safety of our employees, customers, and contractors, as well as to the protection of the environment in the communities in which we operate.

Successful implementation for our company is dependent on maintaining the variety of life on earth and keeping the diversity of our ecosystem in balance for future generations. Sustaining the balance in alignment with the United Nations (UN) Convention on Biological Diversity is something we are committed to doing and we will demonstrate this in our business execution.

We regularly perform Environmental Site Assessments that examine the environmental and ecosystems risks of our operational practices as part of our environmental management. Assessments and due diligence of potential and current sites that focus on risk mitigation of impacts to the community, land, natural resources, ecosystems, and biodiversity are included, and our management program is audited annually by external accredited organizations such as DNV in order to maintain ISO 14001-certification status. An example of this is how we operate in Ecuador, which is no different than any other country or area where we operate. The Amazon rainforest in Ecuador covers the eastern portion of the country. It includes six Ecuadorian provinces: Napo, Orellana, Pastaza, Sucumbíos, Morona Santiago, and Zamora-Chinchipe. In all operating areas, we work to manage our operations with biodiversity in mind because it helps us minimize any adverse impact our activities have on the environment.

As part of our commitment, we track and measure any type of spill or release from our operations, including those on land or in air or water.

We have recorded no hydrocarbon spills in the past five years.

Our success has been achieved by enabling and empowering our people to help us eliminate environmental incidents as we work to achieve ZERO incidents.

Environmental management

Driven by our policy, we have successfully implemented a system to identify and mitigate our risks in the countries in which we operate. Enhancing our management system with certifications enables us to effectively manage our risks. We have obtained API Q1 and Q2, ISO 9001, ISO 14001, and ISO 45001 certifications for 100% of our major property locations.

Dril-Quip’s Environmental Management System (EMS), centered around the ISO 14001 principles, is the foundation for how we operate, and it includes sound environmental practices designed for protecting our planet. Environmental risks are mitigated from our activities by incorporating best practices and procedures designed to enhance our global performance. By design, our policies, procedures, and engineering controls act to reasonably control our impact to the environment caused by our processes, people, contractors, and suppliers at our worksites.

Our EMS, coupled with our skillful people, has allowed us to successfully record ZERO industry-recognized spills of 55 gallons or greater over the last five years. This includes our engineered products used offshore such as our VXTe™ Vertical Subsea Tree System, which effectively helps our customers mitigate potential fluid loss by eliminating the need to remove the BOP stack after drilling is complete. This technology reduces the potential for environmental release in deep-water applications.

By empowering our people, sharing our best practices, implementing lessons learned, and enhancing our controls, we have successfully reduced our soil contaminations at our major property locations from nine in 2015 to ZERO in 2020.

Water and waste management and recycling initiatives

Reducing our waste and promoting recycling is not only good for the environment, but also a sound business decision.

Our management system helps us develop annual objectives and targets to reduce our waste and increase our recycling which helps us show our commitment to the environment and reduce our operating costs.

Empowering our people to effectively identify waste streams for opportunities to recycle and engineering our products with environmental considerations in mind, have enabled us to increase our recycling and reduce our environmental waste.

Measuring our performance each year so we can set clear achievable objectives helps us create an atmosphere of continual improvement.

Our initiatives have been demonstrating strong results since 2015, realized in the reduction in waste, an improvement in our recycling initiatives, and a decrease in water usage.

Water Usage Reduction and Recycling (as of 2021)

Waste (as of 2021)

Using our performance management system to drive our strategies, we are making better choices for our employees and communities and doing our part to reduce our impact to the environment.

We are committed to reducing our waste and making sound business decisions to reduce impacts to air, land, and water.

Our initiatives have been demonstrating strong results over the last five years, realized in the reduction in waste, an improvement in our recycling initiatives and a decrease in water usage.

Regulatory compliance

Maintaining regulatory compliance in the countries where we operate is a key part in our quest for environmental stewardship and we believe our management system and our employees' professional competencies drives this success.

As a part of our performance management system, we track the number of regulatory violations globally and are transparent in our reporting.

Dril-Quip has had minimal violations to date, and none have caused disruptions to our business execution. Each one has been investigated and preventive actions have been put in place. By working with country regulatory agencies, we have improved our system through collaborative efforts.