Mr. Ken Olson reports
HIGH ARCTIC ANNOUNCES NEW CONTRACTS FOR MATS AND ROLLING STOCK IN PNG
High Arctic Energy Services Inc. has been awarded two new contracts from a customer for the supply of mats, and additional rolling stock to support the drilling operations of rigs 115 and 116. The matting contract is for the provision of a minimum of 2,000 mats on a firm two-year term, with the first 1,000 commencing with the completion of rig 115's mobilization. The rolling stock contract is for the provision of cranes and tele-handlers on a firm two year-term, and will commence with the arrival of equipment into Papua New Guinea. The combined annual revenue for these latest contracts will range between $4-million (U.S.) to in excess of $7-million (U.S.) on an annualized basis, dependent upon the total number of mats deployed. The mats will be drawn from High Arctic's existing inventory in Papua New Guinea. The rolling stock will be new equipment designed to handle the requirements of rigs 115 and 116.
High Arctic is also pleased to announce that rig 115 has recently arrived in Papua New Guinea and is currently being mobilized to the first drilling location in Papua New Guinea. The rig is on a reduced moving rate during the mobilization period, which began mid-March, and will go on full operating rate once it is ready to spud the first well. The two-year contract term, with anticipated annualized revenue of $30-million (U.S.), will begin on spud, which is targeted to occur mid-May.
Tim Braun, High Arctic's chief executive officer, stated: "We are excited to have our drilling team in place and to be nearing the commencement of drilling operations with rig 115. The execution of these contracts reinforces our optimism for the Papua New Guinea market amidst the downturn of global commodity prices."
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