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CALGARY, Dec. 1, 2014 /CNW/ - High Arctic Energy Services Inc. (TSX: HWO) ("High Arctic" or the "Company") is pleased to announce that it has signed a Drilling Services Agreement with InterOil Corporation for a second heli-portable drilling rig in Papua New Guinea ("PNG"). High Arctic has agreed to provide its Rig 116, along with a 100 person camp, for a firm contract term of two years. The two year term commences once the rig has been accepted at the first drilling location in PNG. The contract is projected to deliver annualized revenue of approximately US$30 million once the drilling operations commence. It is anticipated that the rig will begin operations in the third quarter of 2015.
Tim Braun, High Arctic's CEO, stated; "The execution of a two year contract for Rig 116 in Papua New Guinea fulfills the growth strategy identified earlier in the year and further strengthens High Arctic's market position in the country. We are pleased that we have expanded our relationship with InterOil and look forward to partnering with them to commercialize their resource fields in PNG."
Rig 116 is currently in Houston Texas undergoing upgrading in preparation for this work and will be mobilized to Papua New Guinea once the work is completed. The commissioning of Rig 115 has commenced following its upgrading and is expected to be shipped to PNG and ready to begin drilling operations under a previously announced contract with InterOil by the end of March, 2015. Both Rig 115 and Rig 116 will be supported from a common location near the InterOil resource fields, which will provide efficiencies in our service delivery offering.
This news release may contain forward-looking statements relating to expected future events and anticipated financial and operating results of the Company 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, but not limited to, market and general economic conditions, and the risks and uncertainties detailed in both the Company's Management Discussion and Analysis for the year ended December 31, 2013 and the Annual Information Form for the year ended December 31, 2013 found on SEDAR (www.sedar.com). Due to the potential impact of these factors, the Company 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
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's largest operation is in Papua New Guinea where it provides drilling and specialized well completion services and supplies rig matting, camps and drilling support equipment on a rental basis. The Canadian operation provides snubbing services, nitrogen supplies and equipment on a rental basis to a large number of oil and natural gas exploration and production companies operating in Western Canada.
SOURCE: High Arctic Energy Services Inc.
For further information: Ken Olson, Chief Financial Officer, Phone: 403 580 7836 ext 103, Email: [email protected]