/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW/
RED DEER, AB, April 27 /CNW/ - High Arctic Energy Services Inc. (TSX:
HWO) ("High Arctic" or the "Corporation") today announced that it has signed a
non-binding expression of interest to sell its interest in Optimal Pressure
Drilling Services to the Schlumberger group ("Schlumberger"). The proposed
purchase price is US$21.8 million and the parties have targeted May 31, 2009
as an anticipated closing date. High Arctic's remaining cash call commitment
of US$4.7 million would also be extinguished as part of the sale. Any sale is
conditional on obtaining any necessary regulatory and lender approvals and
other customary approvals and conditions, and is subject to execution of
definitive purchase and sale agreements.
Optimal Pressure Drilling Services is a joint venture owned 51% by the
Corporation and 49% by Schlumberger. It was formed in 2007 for the purpose of
providing underbalanced drilling services and managed pressure drilling
services primarily to support the drilling operations of the Schlumberger
group. It began business operations on January 1, 2008.
As part of the formation of the joint venture agreement, High Arctic and
Schlumberger entered into an agreement that allows the Corporation to sell its
interest to Schlumberger or Schlumberger to purchase the interest of the
Corporation based on a certain premium to the fair market value of the
entities comprising the joint venture at the time of exercise.
High Arctic's share of revenue from Optimal Pressure Drilling Services
was $8.1 million for 2008 and the loss for 2008 was $4.8 million, excluding
the impact of a foreign exchange loss primarily related to a loan owing to
High Arctic. High Arctic is interested in selling rather than funding any
further operating losses and committing capital to expand into additional
countries. Any proceeds of sale will be applied against debt.
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 the Corporation's Management
Discussion and Analysis for the year ended December 31, 2008 and in High
Arctic's Annual Information Form for the year ended December 31, 2008, all
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 global provider of
specialized oilfield equipment and services, including drilling, completion
and workover operations. Based in Red Deer, High Arctic has domestic
operations primarily in Alberta, British Columbia and the Northwest
Territories. International operations are currently active in Mexico, the
Middle East and Asia.
The TSX has not reviewed and does not accept responsibility for the
adequacy or accuracy of this news release.
For further information:
For further information: Dennis Sykora, Chief Restructuring Officer and
General Counsel, (403) 340-9825