/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
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RED DEER, AB, June 4 /CNW/ - High Arctic Energy Services Inc. (TSX: HWO)
("High Arctic" or "the Company") today has been awarded its fourth drilling
services contract (the "Contract") with a subsidiary of Oil Search Limited
(ASX: OSH) ("OSL") in Papua New Guinea. The Contract is for Rig 104, which is
a state-of-the art heli-portable drilling rig.
Rig 104 is currently under construction by OSL in China. Under the
Contract, High Arctic is providing project management services in China with
respect to the construction, commissioning and mobilization of the rig to
Papua New Guinea, with an anticipated first spud date in the fourth quarter of
The initial term of the Contract is for two years from completion of
mobilization, with two successive one-year option terms. Revenues are
estimated to be over US$25 million per annum. As a condition of the contract,
High Arctic and OSL will enter into a lease agreement under which High Arctic
will lease the rig and assume full management responsibility. This latest
award follows the previously announced contracts with OSL in February and
August 2007 for the management and operation of Rigs 101 and 103 respectively,
as well as a contract for a Hydraulic Workover Rig announced in March 2008.
The annualized revenue for all contracts is estimated at US$80-million.
"Papua New Guinea is one of the world's premier exploitation areas and we
are very proud to be exceeding our expectations through the Rig 104 contract,"
said Jed Wood, President and Chief Executive Officer of High Arctic. "Beyond
the significant revenue already being generated with OSL, the latest contract
award further demonstrates our ability to operate in the international arena.
As the primary drilling contractor in Papua New Guinea, High Arctic is
well-positioned to benefit from increased exploration and production activity
in this exciting region, particularly in light of the recent Liquefied Natural
Gas and exploration announcements by a consortium of major integrated oil
OSL is the fourth-largest listed exploration and production company on
the Australian Stock Exchange. It is the largest oil and gas exploration and
production company operating in Papua New Guinea, with production currently
averaging 54,000 bbls/per day. OSL has recently announced a record exploration
and production investment program that will require a significant increase in
production support and drilling related services.
This news release may contain forward-looking statements relating to
expected future events and 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 market and general economic conditions and the
risks and uncertainties detailed in the Company's Management Discussion and
Analysis for the year ended December 31, 2007 found on SEDAR (www.sedar.com)
and in the Company's Annual Information Form for the year ended December 31,
2007 that is also filed on SEDAR. 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
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 in Alberta, British Columbia and the Northwest Territories.
International operations are currently active in Mexico, the Middle East,
Northern Africa 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: Morley Myden, Chief Financial Officer, High
Arctic Energy Services Inc., Tel: (403) 340-9825, firstname.lastname@example.org