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RED DEER, AB, Sept. 28 /CNW/ - High Arctic Energy Services Inc. (TSX: HWO) ("High Arctic" or the "Corporation") today announced that it has completed the previously announced sale of its interest in the Optimal Pressure Drilling Services joint venture. The entire net proceeds of US$21.6 million have been applied against the Corporation's senior credit facilities.
The outstanding balance on the senior credit facilities has now been reduced to approximately $67.9 million. That balance compares to an outstanding balance of $126.1 million at March 31, 2008, demonstrating the emphasis placed on debt reduction over the past 18 months. Even so, the current debt levels remain too high in the face of the downturn in the Canadian oil and gas activity levels and the Corporation is working on a plan to further reduce its overall debt.
The Corporation continues to negotiate the terms and conditions of any extension of the senior credit facilities that matured on June 12, 2009. The completion of the Optimal sale was one key component as part of the plan to reduce debt to sustainable levels. As previously announced, the Corporation must also restructure the $27.9 million of outstanding convertible debentures, including settling the unpaid interest of $1.4 million that was due on June 30, 2009. High Arctic will continue to report any new developments as they occur in accordance with the requirements of applicable securities law.
This news release may contain forward-looking statements relating to expected future events and financial and operating results of the Corporation that involve risks and uncertainties. Actual results may differ materially from management expectations, as projected in such forward-looking statements for a variety of reasons, including market and general economic conditions and the risks and uncertainties detailed in both the Corporation's Management Discussion and Analysis and Annual Information Form for the year ended December 31, 2008 found on SEDAR (www.sedar.com). Due to the potential impact of these factors, the Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.
About High Arctic
The Corporation, through its subsidiaries, is a provider of specialized oilfield equipment and services, including drilling, completion and workover operations. Based in Red Deer, Alberta, High Arctic has domestic operations throughout Western Canada. International operations are currently active in Papua New Guinea.
SOURCE High Arctic Energy Services Inc.
For further information: For further information: Dennis Sykora, Chief Restructuring Officer, (403) 340-9825, firstname.lastname@example.org