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RED DEER, AB, Sept. 18 /CNW/ - High Arctic Energy Services Inc.
(TSX: HWO) ("High Arctic") today provided updates on the status of its credit
facilities and its activities in Kuwait.
On July 5, 2007, High Arctic secured a commitment on a fully underwritten
basis for up to $155 million of financing from an existing lender comprised of
a senior secured revolving credit facility and second lien notes. The new
facility was to be used in part to repay an existing credit facility owed to a
syndicate represented by that lender. In addition, the parties signed a
commitment letter for a $20 million multi-draw bridge loan facility, which was
subsequently drawn down in full. As a result of changing conditions in the
credit markets, the commitment for the $155 million new facility will not be
completed on the original terms and conditions. High Arctic is in negotiations
to extend, and possibly amend, the existing credit facility and bridge loan
and also for a new credit facility. To assist with the negotiations, a
professional services firm has been engaged as a consultant to assist the
lender in assessing the financial position and future business prospects of
High Arctic. Currently, High Arctic owes approximately $123 million under the
existing credit facility and the bridge loan facility.
In August 2007, High Arctic commenced work on the first well under the
previously announced 5 year contract in Kuwait for the supply of hydraulic
workover and snubbing services. A second hydraulic workover rig has been
called out and is expected to commence operations around October 15. High
Arctic has received an addendum to double the maximum value of the 5 year
contract to US$68 million to reflect the anticipated work program.
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 six months ended June 30, 2007 and in the
Trust's Annual Information Form for the year ended December 31, 2006 and the
Trust's Information Circular dated May 29, 2007, 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. High Arctic's new underbalanced drilling technology
and equipment is recognized for its ability to improve oil and gas production
capabilities and is expected to develop greater acceptance in international
markets. Based in Red Deer, High Arctic has domestic operations in Alberta,
British Columbia and the Northwest Territories. International operations are
currently active in the Middle East, Asia, North Africa and Mexico.
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: Jed Wood, President and Chief Executive
Officer, High Arctic Energy Services Inc., Tel: (403) 340-9825,