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CALGARY, Canada, April 04, 2019 (GLOBE NEWSWIRE) — High Arctic Energy Services Inc. (“High Arctic”) is pleased to announce it has entered into an agreement to acquire the assets of Precision Drilling‘s snubbing services equipment, entirely located in Canada (“Precision Snubbing”). The acquisition is expected to close on April 15, 2019, and will provide High Arctic with additional quality snubbing equipment and access to experienced personnel and crews.
The purchase price of a total of $8.25 million will be settled in cash from cash on hand.
The acquisition will provide High Arctic with twelve additional marketed snubbing units, seven of which have been active over the last twelve months, as well as certain patent rights related to the design and configuration of stand-alone snubbing units and spare equipment. This will provide additional capacity to further strategic diversification and growth in the United States. It will also increase High Arctic’s fleet size, scale and capability in Canada to meet the needs of customers through safe and efficient services designed to increase production and lower costs. Upon closing of the acquisition, High Arctic will own and operate the largest snubbing fleet in Canada consisting of a total of 29 snubbing units.
The acquisition will complement High Arctic’s Powerstroke acquisition announced in August 2018, which established an entry into the United States for High Arctic, enabling it to continue to expand its well service offering. The trend toward longer well bores and increased number of stages in each well bore has increased the demand for pressure control equipment required for well completions. Of High Arctic’s total fleet of snubbing units, five are currently being marketed in the United States and an additional three units will be deployed for well service and completion work in the Niobrara and the Bakken. High Arctic is examining other markets in the United States to expand its services.
Mr. J. Cameron Bailey, Chief Executive Officer commented: “We are very pleased with the acquisition of additional high-quality snubbing equipment and further industry consolidation in Canada. We recognize the long history of Precision Snubbing and are keen to position these assets and certain personnel into High Arctic’s quality service offering to customers. Our customers are demanding ever increasing quality of service, delivered with high safety standards while maintaining pricing discipline. The acquisition will improve our ability to balance client expectations and profitability. The acquisition reinforces and further enables our strategy to deploying underperforming equipment located in Canada to the United States where the equipment can earn a reasonable return through better day rates and utilization. We are particularly excited about our ability to continue to build upon the initial success we have had with offering our services in the United States and capitalize on our increased market share in Canada. We welcome our new well-trained experienced personnel who will be joining the High Arctic Team.”
This News Release contains forward-looking statements. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “seek”, “propose”, “estimate”, “expect”, and similar expressions are intended to identify forward-looking statements. Such statements reflect the Corporation’s current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the Corporation’s actual results, performance or achievements to vary from those described in this News Release. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this News Release as intended, planned, anticipated, believed, estimated or expected. Specific forward looking statements in this Press Release include, among others, statements pertaining to the following: the closing of the acquisition by High Arctic of Precision Snubbing; the potential expansion by High Arctic of its well service offerings; the marketing is snubbing units in the United States; and the effects thereof.
With respect to forward-looking statements contained in this News Release, the Corporation has made assumptions regarding, among other things, that the acquisition of Precision Snubbing will close as scheduled. The Corporation’s actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors set forth above and elsewhere in this News Release, along with the risk factors set out in the most recent Annual Information Form filed on SEDAR at www.sedar.com.
The forward-looking statements contained in this News Release are expressly qualified in their entirety by this cautionary statement. These statements are given only as of the date of this News Release. The Corporation does not assume any obligation to update these forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law.
About High Arctic
High Arctic is a publicly traded company listed on the Toronto Stock Exchange under the symbol “HWO”. The Corporation’s principal focus is to provide drilling and specialized well completion services, equipment rentals and other services to the oil and gas industry.
High Arctic is a market leader providing drilling and specialized well completion services and supplies rig matting, camps and drilling support equipment on a rental basis in Papua New Guinea. The Canadian and US operation provides well servicing, well abandonment, snubbing and nitrogen services and equipment on a rental basis to a large number of oil and natural gas exploration and production companies operating in Western Canada and the United States.
For further information contact:
J. Cameron Bailey
Chief Executive Officer
P: (587) 318-3826
Chief Financial Officer
P: (587) 318-2218