ST. ALBERT, ALBERTA--(Marketwired - May 27, 2014) - Enterprise Group, Inc. ("Enterprise," or the "Company") (TSX:E) is pleased to announce that Hart Oilfield Rentals Ltd. ("Hart"), a recently acquired subsidiary of the Company, has renewed its Master Service Agreement ("MSA") with Canada's largest natural gas producer. This MSA has a value of $19.2 million and a term of two years, an increase relative to prior single year agreements. The MSA confirms the commitment for a steady supply of equipment and labour created by the producer's aggressive drill program.
This MSA is effective immediately, and will utilize all of Hart's existing equipment lines. These lines include Hart's patented combo units, which provide a full range of equipment and service offerings to their customers. The MSA also includes a provision for transportation and the set-up of the units, in addition to labour utilization. This service component of the MSA reflects Hart's competitive advantage in the industry. While scope of the MSA spans various geographies, the majority of work will take place within the very active Valleyview, Pouce Coupe, Grande Prairie, and Rocky Mountain House locations, which will serve the Clearwater, Duvernay, Bighorn CutBank Ridge, Horn River, and Peace River producing regions.
Hart's ability to fulfill the demands of this MSA is a result of Enterprise's capital expenditure program for 2014, which will utilize proceeds from the $27.6 million financing the Company completed in March of 2014. $10.0 million of the Company's capital program has been devoted towards equipment purchases for Hart. The Company anticipates that these purchases will be complete by October of 2014. The majority of these purchases are innovative equipment that includes two custom designed 'hook trucks,' which will facilitate rapid and efficient movement of Hart's combo units via patented hook technology.
"The acquisition of Hart has allowed Enterprise to establish a position as a rapidly emerging player within the oilfield service industry," stated Leonard Jaroszuk, the Company's President and Chief Executive Officer. "While Hart's contribution to our business was clearly evident within our recent first quarter results, its true value will be demonstrated by contracts like this one. Our confidence is further bolstered by Hart's ability to leverage its existing relationship with this client, Canada's largest natural gas producer, a company poised to execute a robust drilling program over the next five years. This contract is a strong signal that Enterprise will play a role in the execution of that program, and I expect that several segments of our business will benefit as a result."
Hydro-Vac Fleet Update
Enterprise also announced that the Company had recently taken delivery of six new hydro-vac units, bringing its total fleet of owned units to 14. The Company has also confirmed delivery dates for an additional six units. These units will be 100% utilized, as the Company currently uses five to ten subcontractors on a regular basis in order to satisfy the significant demand for hydro-vac services. In order to satisfy this demand moving forward, the Company has also confirmed delivery dates for 12 additional hydro-vac units over the course of 2015.
About Enterprise Group, Inc.
Enterprise Group, Inc. is a consolidator of construction services companies operating in the energy, utility and transportation infrastructure industries. The Company's focus is primarily construction services and specialized equipment rental. The Company's strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. Enterprise acquired of Artic Therm International Ltd. in September 2012, Calgary Tunnelling & Horizontal Augering Ltd. in June 2013, and Hart Oilfield Rentals in January 2014.
Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.