11/08/2019 | Press release | Distributed by Public on 11/08/2019 10:15
Calgary Alberta, November 7, 2019 - High Arctic Energy Services Inc. (TSX: HWO) - 'High Arctic' or the 'Corporation' is pleased to announce its 2019 third quarter results.
Mr. J. Cameron Bailey, High Arctic's CEO stated: 'I'm very proud of the tremendous team we have at High Arctic and the dedication to providing an outstanding quality service with world class safety performance both in North America and Papua New Guinea.
Market conditions in Canada continue to be very challenging, with the average land rig count in the third quarter 37% below last year. By focusing on cross-selling each of our service lines, and increasing penetration in the United States, we were able to increase Production Services revenue by 9%. We expect High Arctic to continue to benefit from relatively consistent Well Servicing activity in the fourth quarter, notwithstanding average rig count in Canada remains significantly below levels experienced in 2018.
In PNG, the expected ramp up of drilling activities in the fourth quarter of 2019 is now pushed into the new year as Operators finalize the gas agreements with the government of PNG expected later in 2019. The expiry of Rig 116 take-or-pay contract in November of 2018 weighs heavily on year over year comparative financial results. Rigs 115 and 116 are available for immediate reactivation.
We made the difficult decision to reduce our support workforce by 10% over the quarter to adjust to more competitive market conditions and have focused on managing our capital expenditures which have been restricted to required repairs and maintenance in order to preserve strong financial position and operate within our cashflow.
I want to thank all of our employees for their efforts and devotion to deliver top quality operations, logistics and safety. For this reason, High Arctic has been able to work for some of the world's top oil and gas companies, increase market share and maintain high equipment utilization rates in tough market conditions.'
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