CALGARY, Oct. 26, 2011 /CNW/ - IROC Energy Services Corp. ("IROC" or the
"Corporation") (TSXV: "ISC") is pleased to announce the deployment of
the three new coil tubing units budgeted in our 2011 capital program,
an operational update describing current conditions, progress on our
2011 capital expenditures and certain components of the 2012 capital
budget.
Helix Coil Services
Helix has taken delivery of the three coiled tubing units announced in
our 2011 capital budget. All of the units have a 2"capacity which
places them in the intermediate size range for coil tubing. Customer
demand for this size of equipment is expected to remain strong through
the winter season. Two of the units were deployed during the third
quarter. The third unit, which was delivered in October, has already
been placed into active service and deployed in the field. These three
units represent our entrance into the coil tubing business.
Eagle Well Servicing
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Three months ended
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September 30,
2011
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June 30,
2011
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March 31,
2011
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December 31,
2010
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Eagle Well Servicing:
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Number of service rigs (end of period)
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38
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36
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36
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35
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Service rig utilization
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72%
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42%
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78%
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66%
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Three months ended
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September 30,
2010
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June 30,
2010
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March 31,
2010
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December 31,
2009
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Eagle Well Servicing:
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Number of service rigs (end of period)
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35
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35
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36
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36
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Service rig utilization
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57%
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33%
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55%
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49%
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As at September 30, 2011, Eagle had a fleet of 38 service rigs.
Utilization, as measured by IROC's internal methodology, during the
quarter was 72%. Eagle's service rig fleet and equipment is amongst
the newest in the industry. Since September, the Corporation has
deployed one additional rig, for a total service rig fleet of 39 rigs
currently crewed and operated. In addition, 3 new service rigs are
currently being built, with expected delivery in 2011. As part of these
deliveries, Eagle's first 2 slant rigs are being delivered in November
allowing the company to address opportunities in the heavy oil and SAGD
markets. Management expects that our full 2011 capital expenditure
budget of $27.6 million will be expended by yearend.
Additionally, we have budgeted $12.5 million and secured five new build
slots for our 2012 capital program. The five additional rigs are
expected to be deployed between December 2011 and June 2012, meaning
that Eagle Well Servicing expects to have 43 rigs operational by year
end and 47 rigs operational by the end of the second quarter of 2012.
Orders for the 2012 service rigs were placed to ensure increasing lead
times for delivery of certain service rig components do not delay
delivery of the new rigs from our anticipated time schedule. Our full
2012 capital budget is expected to be released prior to yearend.
The trend toward increased oil related activity continues to provide
benefit for our service rig division. Current activity levels are
estimated to be approaching 80% levered to oil, with completion, work
over and abandonment activity all providing continued strong demand for
our services in the foreseeable future.
Eagle Well Servicing has been able to fully crew its assets through the
third quarter of 2011, despite a very tight labour market across the
service industry.
Aero Rental Services
With the increase in drilling and field service activity in the last 12
months, IROC's rental services division remains strong and continues to
grow. The increase in horizontal and SAGD drilling activity in Western
Canada has been the main driver of growth in Aero's business. This has
been complemented by increased fracturing and coil tubing related
business which was an area Aero targeted for growth when Aero acquired
the rental assets of Trust Energy Services in the third quarter of
2010.
Aero continues to increase its capital assets through targeted equipment
purchases aimed at meeting current or anticipated customer demand.
Canada Tech
During July IROC sold the operating assets and business of Canada for
$4.8 million with IROC retaining an additional $1.2 million in working
capital. While Canada Tech remained a viable operation with over $10
million in sales last year, the division was underperforming in
relation to our other businesses and a decision was made to sell the
division and deploy the capital into the other more rapidly growing
areas of our business.
Updated Corporate Presentation
An Updated Corporate Presentation has been posted to the Corporation's
website at www.iroccorp.com.
About IROC Energy Services Corporation
IROC Energy Services Corp. is an Alberta oilfield services company that,
through the IROC Energy Services Partnership, provides a diverse range
of products, services and equipment to the oil and gas industry that
are among the newest and most innovative in the WCSB. IROC Energy
Services Partnership operates under the business names of Eagle Well
Servicing, Aero Rental Services and Helix Coil Services. IROC combines
cutting-edge technology with depth of experience to deliver a product
and services offering in the following core areas: well servicing &
equipment, rental services and coil tubing services. For more
information on IROC Energy Services Corp., visit our website at www.iroccorp.com.
Cautionary Statement Regarding Forward Looking Information and
Statements
Certain information contained in this news release, including
information related to the Corporation's level of service rig
utilization, future capital expenditures, anticipated equipment counts
and information or statements that contain words such as "forecasted",
"could", "should", "can", "anticipate", "expect", "believe", "will",
"may", "likely", "estimate", "predict", "potential", "continue",
"maintain", "retain", "grow", and similar expressions and statements
relating to matters that are not historical facts, constitute
"forward-looking information" within the meaning of applicable Canadian
securities legislation. This information or these statements are based
on certain assumptions and analysis made by the Corporation in light of
its experience and its perception of historical trends, current
conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances, and the statements
contained in this news release speak only as of the date hereof.
Whether actual results, performance or achievements will conform to the
Corporation's expectations and predictions is subject to a number of
known and unknown risks and uncertainties which could cause actual
results to differ materially from the Corporation's expectations. Such
risks and uncertainties include, but are not limited to: fluctuations
in the price and demand for oil and natural gas; fluctuations in the
level of oil and natural gas exploration and development activities;
fluctuations in the demand for well servicing and ancillary oilfield
services; capital market liquidity available to fund oil and gas
exploration and development programs; the effects of seasonal and
weather conditions on operations and facilities; the highly
competitive operating environment inherent in well servicing and
ancillary oilfield services; general economic, market or business
conditions; changes in laws or regulations; the availability of
qualified operational and management personnel; currency exchange and
interest rate fluctuations; uncertainties associated with regulatory
approvals; uncertainty of government policy changes; uncertainties
associated with credit facilities and counterparty credit risk; changes
in income tax laws or changes in tax laws, crown royalty rates and
incentive programs relating to the oil and gas industry; risks
associated with government regulations and environmental health and
safety matters; and other unforeseen conditions which could impact the
use of equipment and services supplied by IROC.
Consequently, all of the forward-looking information and statements made
in this news release are qualified by this cautionary statement and
there can be no assurance that the actual results will be realized.
Except as may be required by law, the Corporation assumes no obligation
to update publicly any such forward-looking information and statements,
whether as a result of new information, future events, or otherwise.
Other
This press release is not for dissemination in United States or to any
United States news services. The Common Shares of IROC have not and
will not be registered on the United States Securities Act of 1933, as amended (the "United States Securities Act") or any state securities laws and are not offered or sold in the
United States or to any US person except in certain transactions exempt
from the registration requirements of the United States Securities Act and applicable state securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
