Pure Energy Services Ltd.
TSX : PSV

Pure Energy Services Ltd.

March 08, 2007 18:52 ET

Pure Energy Services Ltd. Announces a U.S. Operations Update

CALGARY, ALBERTA--(CCNMatthews - March 8, 2007) - Pure Energy Services Ltd. ("Pure Energy") (TSX:PSV) is providing a U.S. operations update.

Fracturing

Management has received confirmation that Pure Energy Services (USA), Inc.'s ("Pure USA") fracturing sand supplier has commenced commercial operations and is currently processing fracturing sand for delivery. Management expects that Pure USA will receive the first deliveries of fracturing sand in Colorado prior to the end of March.

To date, the Fracturing division has completed 17 fracturing jobs for three customers in the Piceance Basin. Pure USA has, over the past 12 months, entered into discussions with a number of oil and natural gas exploration and development companies for the provision of fracturing services in the US Rocky Mountain region. Upon receipt of a consistent supply of fracturing sand, Management expect that Pure USA will enter into service supply agreements with some of these companies to achieve Management's strategy to have contracted approximately 65% of the utilization of the first two fracturing spreads.

The Fracturing division has received delivery of its second fracturing spread and is currently field testing the equipment. The second fracturing spread has been almost fully staffed and Management expects that it will commence operations once Pure USA receives a consistent supply of fracturing sand. Management anticipates that Pure USA's third fracturing spread will become operational in the 2007 third quarter.

Pure USA has entered into an agreement for the purchase of approximately 40 acres of property near Grand Junction, Colorado which will be used for sand storage and other operational facilities for Pure USA's operations in the Piceance Basin. Management expects that the closing of the purchase of this property will be completed prior to the end of March.

Management remains confident that the market for fracturing services remains strong in the US Rocky Mountain region and expects that customer acceptance and the utilization of both of the Fracturing division's fracturing spreads to increase upon receipt of a consistent supply of fracturing sand from its fracturing sand supplier. Management continues to expect that the contributions of the US Fracturing division to Pure Energy's 2007 financial results will meet expectations.

Logging and Perforating

The US Logging and Perforating division has reached agreement with a major independent exploration and development company to provide the majority of the logging and perforating services required in that company's operations in the South Piceance Basin. Management also anticipates that the expected increase in utilization of the fracturing spreads will have a positive impact on the utilization of the logging and perforating units through the provision of complementary logging and perforating services. Management will consider the transfer of additional logging and perforating units from the Canadian operations if sufficient demand for logging and perforating services in the US Rocky Mountain region exists.

Testing

The US Production Testing division has achieved high utilization of its units in Wyoming and Colorado during the last six months. Demand for services has increased to the point where a unit from the Canadian Production Testing division is currently being retrofitted to meet operational requirements for use in the US Rocky Mountain region. This unit will be permanently transferred to the US Production Testing division once the retrofitting is completed.

Outlook

Despite the delays encountered in the deliveries of both fracturing spreads and in the delivery of consistent supplies of fracturing sand, Management remains confident that Pure USA will be successful in establishing itself as a significant provider of production testing, logging and perforating and fracturing services in the US Rocky Mountain region. Management continues to expect that Pure USA will continue to grow its operations and will be a significant contributor to Pure Energy's 2007 financial results.

About Pure Energy

Pure Energy 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 ("WCSB") and, through its wholly-owned subsidiary, Pure Energy Services (USA), Inc., in the US Rocky Mountain region.

Pure Energy currently provides logging and perforating, production testing, multiline, drilling, drilling rental and pressure transient analysis services to customers in the WCSB, and also provides production testing, logging and perforating, and fracturing services to customers in the US Rocky Mountain region.

Forward Looking Information

Certain statements in this press release, including the delivery projections outlined herein, may constitute "forward-looking information" which involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Pure, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. When used in this press release, such information uses such words as "may", "would", "could", "will", "intend", "expect", "believe", "plan", "anticipate", "estimate", "confident" and other similar terminology. This information reflects Pure's current expectations regarding future events and operating performance and speaks only as of the date of this press release. Forward-looking information involves significant risks and uncertainties, should not be read as a guarantee of future performance or results, and will not necessarily be an accurate indication of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, including, but not limited to, the factors discussed below. Although the forward-looking information contained in this press release is based upon what management of Pure believes are reasonable assumptions, Pure cannot assure investors that actual results will be consistent with this forward-looking information. This forward-looking information is provided as of the date of this press release, and, subject to applicable securities laws, Pure assumes no obligation to update or revise such information to reflect new events or circumstances.

Pure's actual results could differ materially from those anticipated in the forward-looking information as a result of the following factors: general economic conditions in Canada and the United States; demand for oilfield services during drilling and completion of oil and natural gas wells; volatility in market prices for oil and natural gas and the effect of this volatility on the demand for oilfield services generally; competition; liabilities and risks, including environmental liabilities and risks, inherent in oil and natural gas operations; sourcing, pricing and availability of raw materials, consumables, component parts, equipment, suppliers, facilities, and skilled management, technical and field personnel; ability to integrate technological advances and match advances of competition; availability of capital; uncertainties in weather and temperature affecting the duration of the oilfield service periods and the activities that can be completed; changes in legislation and the regulatory environment, including uncertainties with respect to implementing the Kyoto Protocol; and the other factors considered under "Risk Factors" in Pure Energy's Annual Information Form dated March 8, 2007 which is available under the Pure Energy's profile at www.sedar.com.

Contact Information

  • Pure Energy Services Ltd.
    Kevin Delaney
    President and CEO
    Email: kdelaney@pure-energy.ca
    or
    Pure Energy Services Ltd.
    Michael Baldwin
    Chief Financial Officer
    Email: mbaldwin@pure-energy.ca
    or
    Pure Energy Services Ltd.
    #300, 1010 - 1st Street S.W.
    Calgary, Alberta T2R 1K4
    (403) 262-4000
    (403) 262-4005 (FAX)
    Website: www.pure-energy.ca