CALGARY, Jan. 22 /CNW/ - Petrowest Energy Services Trust ("Petrowest")
(TSX - "PRW.UN") announced today that Petrowest is suspending cash
distributions as of January 2008.
Given the decreased upstream oil and gas activity levels and pricing
pressures currently being experienced, Petrowest believes greater unitholder
value can be created by retaining the cash and continuing to pay down debt
levels and providing the flexibility to capitalize on future opportunities as
they occur when industry fundamentals improve. At the previous monthly
distribution level of $0.03 per unit, on an annualized basis, approximately
$11.4 million will be retained.
Petrowest has analyzed restructuring alternatives and believes that there
is value from both a tax deductibility of distributions and potential industry
consolidation perspective in retaining the Trust structure through to 2011.
This issue, however, will continue to be reviewed on an ongoing basis.
Management expects industry activity will return to higher levels in late 2008
or early 2009 and that Petrowest will be in a position to re-examine its
Petrowest is a leading provider of pre-drilling and post-completion
energy and civil infrastructure services to the northern region of the western
Canadian sedimentary basin. Petrowest is an unincorporated, open-ended,
limited purpose, mutual fund trust established under the laws of Alberta.
This news release contains forward-looking statements that involve
substantial known and unknown risks and uncertainties. These forward-looking
statements are identified by their use of terms and phrases such as
"anticipate," "achievable," "believe," "expect," "estimate," "plan," "intend,"
"project," "may," "should", "could", "predict", "may," "will," or similar
words suggesting future outcomes or language suggesting an outlook.
Forward-looking statements and information are based on Petrowest's current
beliefs as well as assumptions made by and information currently available to
Petrowest concerning anticipated business performance and other risk factors
as described in Petrowest's Annual Information Form. Although management of
Petrowest considers these assumptions to be reasonable based on information
currently available to it, they may prove to be incorrect.
Forward-looking statements are subject to many external variables that
are beyond Petrowest's control, such as fluctuating prices for crude oil and
natural gas, changes in drilling activity, and general local and global
economic, political, business and weather conditions. If any of these, or
other uncertainties, materialize the actual results of Petrowest may vary
materially from those expected.
For further information:
For further information: Kenneth N. Drysdale, President and Chief
Executive Officer at (780) 830-0881; or Lloyd Wiggins, Chief Financial
Officer, at (403) 237-0881 or firstname.lastname@example.org