Pure Energy Services Ltd.

Pure Energy Services Ltd.

January 31, 2011 08:30 ET

Pure Energy Announces 2011 Capital Expenditure Program

CALGARY, ALBERTA--(Marketwire - Jan. 31, 2011) - Pure Energy Services Ltd. ("Pure" or the "Company") (TSX:PSV) announced today that its Board of Directors has approved a capital expenditure budget for 2011 of approximately $38 million, of which $4 million has been carried over from previously announced capital expenditures for 2010 and 2011. The budget will be deployed in the Company's Well Testing and Cased Hole Wireline operations in Canada and the USA.

The budget includes the following (Canada and USA combined): approximately $16 million for Well Testing operations and approximately $14 million for Cased Hole Wireline operations for revenue generating equipment and/or equipment that will reduce operating expenses and the remaining $8 million for the refurbishment of existing equipment, facility expansions and other infrastructure.

The $16 million budgeted for Pure's Well Testing operations includes the addition of 14 high pressure testing packages (two of which were included in previously announced capital expenditures) and the purchase of ancillary equipment such as high pressure pipe, sand traps and line heaters. The testing packages (which will be used primarily for fracturing flowback work) can be utilized in the high activity areas of northern Alberta and northern British Columbia and the Marcellus shales in Pennsylvania. Currently, 12 packages are planned to be used in Canada and two packages in the USA.

The $14 million budgeted for Pure's Cased Hole Wireline operations include funds for the acquisition of horizontal well conveyance, logging, fiber optic sensing and high pressure ancillary equipment. The ancillary equipment expected to be purchased for both the Well Testing and Cased Hole Wireline operations will, in large part, replace equipment currently rented by the Company and is expected to improve operating margins in both operating groups. 

Approximately 40% of the capital expenditures are currently planned for the second half of 2011, which provides the Company with flexibility to react to industry conditions.

As at December 31, 2010 (and prior to the above described capital expenditures), Pure's equipment fleet was comprised of the following:

    Well Testing Packages       Wireline Units
    Canada   USA       Canada   USA
Operating                    65                    42                        57                    11
Parked                      3                      1                        13                      6
Total                    68                    43                        70                    17

Pure is an oilfield services company that provides completion and drilling related services to oil and gas exploration and development entities in the Western Canadian Sedimentary Basin and, through its wholly-owned subsidiary, Pure Energy Services (USA), Inc., in the Rocky Mountain region, North Dakota and the Appalachian Basin of the USA.

Forward-looking Statements

Certain information contained in this news release may constitute forward-looking statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward-looking statements and information concerning management's assessment of future plans and operations of Pure, the 2011 capital expenditures budget, anticipated 2011 capital expenditures and the timing thereof and expectations regarding demand for the Company's services. These forward-looking statements and information are based on certain key expectations and assumptions made by Pure. Although Pure believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information as Pure cannot give any assurance that they will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties, certain of which are beyond the Company's control, including without limitation the impact of general economic conditions; industry conditions; commodity prices; fluctuation of exchange rates; health, safety and environmental risks; competition; availability of equipment and qualified personnel and management; dependence on major customers; uncertainties in weather and temperature affecting the duration of service period and the activities that can be completed; changes in legislation, including without limitation tax laws, royalties and environmental legislation; and timely and cost effective access to sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Pure's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be access through the SEDAR website (www.sedar.com) and at the Company's website (www.pure-energy.ca). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Pure does not undertake any obligation to update publicly or revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Requests for shareholder information should be directed to Kevin Delaney or Chris Martin.

Contact Information

  • Pure Energy Services Ltd.
    Kevin Delaney
    (403) 262-4000
    (403) 262-4005 (FAX)
    Pure Energy Services Ltd.
    Chris Martin
    Chief Financial Officer
    (403) 262-4000
    (403) 262-4005 (FAX)
    Pure Energy Services Ltd.
    10th Floor, 333 - 11th Avenue S.W.
    Calgary, AB
    T2R 1L9