NATURAL GAS SERVICES GROUP INC

6. Rental Equipment

The following table summarizes our rental equipment and accumulated depreciation as of the dates presented:

We evaluated our rental equipment for potential impairment as of December 31, 2025 and 2024 and determined that none were present. We capitalized interest totaling approximately $2.5 million, $4.7 million and $5.5 million in connection with the acquisition and assembly of compressor units for the years ended December 31, 2025 and 2024 and 2023, respectively. Depreciation expense for rental equipment was $32.7 million, $28.2 million and $24.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Retirement of Rental Equipment

We routinely review our rental fleet for retirement or obsolescence as well as an assessment to determine which units are not of the type, configuration, make or model that our customers are demanding or that are not cost efficient to refurbish, maintain and/or operate. As a result of these reviews, we recorded charges for the retirement of rental equipment of $0.7 million, less than $0.1 million and $0.5 million during the years ended December 31, 2025, 2024 and 2023, respectively.

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Rental Activity

Future minimum rent payments for the periods presented due as of December 31, 2025 from our customers for contractual arrangements, not on a month-to-month basis, were as follows:

7. Property and Equipment

The following table summarizes our property and non-rental equipment as of the dates presented:

(1) Includes $2.6 million recognized as an impairment in 2025 as discussed below.

In connection with our efforts to plan for an eventual sale of our former corporate headquarters facility including a building and land in Midland, Texas (the “Former Headquarters Property”), we undertook certain actions in the fourth quarter of 2025 to begin building-out a new leased office facility in Midland, Texas. While the Former Headquarters Property remained in use as of December 31, 2025, these actions triggered a review for impairment of the Former Headquarters Property consistent with our plans to relocate to the new leased facility in 2026. In our evaluation for the impairment, the cash flows that we considered were those that we expect to receive from a sale of the Former Headquarters Property, less costs to sell, or fair value. As the carrying value of the Former Headquarters Property exceeded the fair value less costs to sell, we recognized an impairment of $2.6 million in the fourth quarter of 2025. Subsequently, we entered into an exclusive listing agreement in February 2026 for the sale of the Former Headquarters Property (see Note 19).

Depreciation expense for property and equipment was $3.9 million, $2.4 million and $2.4 million for the years ended December 31, 2025, 2024 and 2023, respectively.

During 2025, we reclassified certain items of property and equipment attributable to our former Midland Facility with a carrying value of $2.2 million to assets held for sale (see Note 5).