The Sub Tank is almost in plain sight, at the top right corner of the large open area near the start of the stage. Use the dragonfly platform or vertical dash to get it.
It's in plain sight on an overhang as you emerge from the underground segment of the stage. Get the Leg Upgrade later in the stage. Backtrack all the way back to the last ladder you climbed, get on the platform to the right of the overhang, jump to the left, perform a vertical air dash, and stick to the left to get the Sub Tank. It is possible to reach the platform by simply dash jumping off the wall beneath the overhang, however it is extremely difficult.
There is however another sneakier way to reach the capsule without the Leg Upgrade. It involves exploiting a glitch where changing to Zero in mid-air extends how far you can travel without dropping too much. Go to the highest elevated platform to the right. Try to make sure their are no enemies in the way back to the left. Dash jump to the left. Travel as far to the left as X can go, then, just as he starts to descend, pause the game. Switch to Zero. Hold left as you unpause. Travel to the left briefly as Zero, perhaps half a second, then pause again. Switch back to X. Hold left again as you unpause. X should make the distance all the way to the overhang, and you can wall jump up to reach the Sub Tank. You only have one shot at this, since you can only switch to Zero once. You will have to get the Leg Upgrade later in the stage if you fail.
The Sub Tank is almost in plain sight. As you proceed the tunnel area, climb up the open ceiling on the right wall a little before the Bit/Byte room to get the Sub Tank.
Unlock Ride Armors. At the last area of the stage, just after the Bit/Byte room, climb up the far right wall. Get on the Ride Armor Platform, select it, go back down to crash through the floor, proceed to the left, and get the Sub Tank. Note that to make it there with the Frog Ride Armor, you will have to dash jump to get a high enough jump over a platform, although there is no real reason to use Frog over Chimera.