Trican Well Service Ltd.
TSX : TCW

Trican Well Service Ltd.

November 08, 2010 20:12 ET

Trican Announces 2011 Capital Budget

CALGARY, ALBERTA--(Marketwire - Nov. 8, 2010) - Trican Well Service Ltd. (TSX:TCW) is pleased to announce our 2011 Capital Budget.

Trican's Board of Directors has approved the 2011 Capital Budget of $373 million. This capital budget largely focuses on expansion capital targeting key growth areas for Trican in our Canadian and US geographic regions and also includes expenditures required to maintain our current operating capabilities.

The Canadian Operations' 2011 capital budget totals $128 million comprising $104 million in expansion capital and $24 million in infrastructure and maintenance capital. The expansion capital includes the addition of 62,500 fracturing horsepower (HP), 4 nitrogen pumpers, 5 twin cement pumpers and 2 acid pumpers. The expansion capital is required to support expected customer demand in the Western Canadian Sedimentary Basin (WCSB), particularly in oil and liquids rich plays. The additional horsepower will be specifically designed for use in unconventional oil and gas plays and will increase the Canadian Operations horsepower capacity to approximately 328,000 HP.

The Russian Operations' 2011 capital budget totals $9 million entirely comprising infrastructure and maintenance capital. This budget includes the expansion of our Russian research and development capabilities which is expected to further establish our strong technical capabilities in the Russian market.

The US Operations' 2011 capital budget totals $236 million comprising $197 million in expansion capital and $39 million in infrastructure and maintenance capital. The 2011 capital budget includes the addition of 197,500 HP and 10 twin cement pumpers. The expansion capital is required to support expected customer demand and geographic expansion targeting oil and liquids rich plays in the US market. The additional horsepower will be specifically designed for use in unconventional oil and gas plays and will increase the US Operations horsepower capacity to approximately 548,000 HP.

Trican's 2011 Capital Budget is a continuation of the aggressive expansion initiated during 2010. The growth is primarily focused on the US and Canadian markets as these markets are currently experiencing strong customer demand particularly in oil and liquids rich plays. We expect the strong customer demand in these two markets to continue in 2011. Trican is in a solid financial position with a strong balance sheet and significant cash flow generating capabilities. We anticipate funding this capital budget with existing cash and available debt combined with cash flow from operations.

Forward-Looking Statements

This document contains statements that constitute forward-looking statements within the meaning of applicable securities legislation. These forward-looking statements are identified by the use of terms and phrases such as "will," "expected", "anticipate, "opportunity," and other similar terms and phrases. These statements speak only as of the date of this document and we do not undertake to publicly update these forward-looking statements except in accordance with applicable securities laws. These forward-looking statements include, among others:

- the expectation that the expansion capital is required to support customer demand in the WCSB and in the U.S. market;

- the expectation that the expansion of our Russian research and development capabilities will further establish our strong technical capabilities in the Russian market;

- the expectation that strong customer demand in Canada and the U.S. will continue in 2011;

- the expectation that the capital budget will be funded with existing cash and available debt combined with cash flow from operations.

Forward-looking statements are based on current expectations, estimates, projections and assumptions, which we believe are reasonable but which may prove to be incorrect and therefore such forward-looking statements should not be unduly relied upon. In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: industry activity; the general stability of the economic and political environment; effect of market conditions on demand for the Company's products and services; the ability to obtain qualified staff, equipment and services in a timely and cost efficient manner; the ability to operate its business in a safe, efficient and effective manner; the performance and characteristics of various business segments; the effect of current plans; the timing and costs of capital expenditures; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Company operates; and the ability of the Company to successfully market its products and services.

Forward-looking statements are subject to a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks and uncertainties include: fluctuating prices for crude oil and natural gas; changes in drilling activity; general global economic, political and business conditions; weather conditions; regulatory changes; the successful exploitation and integration of technology; customer acceptance of technology; success in obtaining issued patents; the potential development of competing technologies by market competitors; and availability of products, qualified personnel, manufacturing capacity and raw materials. In addition, actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors set forth under the section entitled "Risk Factors" in the Annual Information Form of the Company dated March 26, 2010 which is available on SEDAR at www.sedar.com and on our website at www.trican.ca.

Headquartered in Calgary, Alberta, Trican has operations in Canada, Russia, the US and North Africa. Trican provides a comprehensive array of specialized products, equipment and services that are used during the exploration and development of oil and gas reserves.

Requests for shareholder information should be directed to the contacts below.

Contact Information

  • Trican Well Service Ltd.
    Dale Dusterhoft
    Chief Executive Officer
    (403) 266-0202
    ddusterhoft@trican.ca
    or
    Trican Well Service Ltd.
    Michael Baldwin
    Vice President, Finance and Chief Financial Officer
    (403) 266-0202
    mbaldwin@trican.ca
    or
    Trican Well Service Ltd.
    2900, 645 - 7th Avenue S.W.
    Calgary, Alberta T2P 4G8
    (403) 237-7716 (FAX)
    www.trican.ca