Mr. Mike Maguire reports

HIGH ARCTIC ANNOUNCES AGREEMENT TO SELL NITROGEN ASSETS

High Arctic Energy Services Inc. has entered into an asset purchase agreement with a private Canadian energy service company to sell its Canadian nitrogen pumping assets for gross proceeds of $1.35-million in cash before transaction costs.

The nitrogen transaction results in the transfer of High Arctic's dedicated nitrogen assets and support employees to the buyer. High Arctic retains associated working capital and estimates a modest gain on sale over equipment net asset carrying value.

Mike Maguire, High Arctic chief executive officer, commented: "The nitrogen transaction builds on our strategy to free up capital employed in service lines where shareholder returns have proven substandard. Our nitrogen service line has a small market presence, and service industry consolidation carries merit for all stakeholders. We believe the nitrogen transaction sets our employees up for success as they transition to a larger team wherein their safety, service acumen and operational skill set them up for career success."

"Postclosing, High Arctic's investment in Canada is comprised of its 42-per-cent equity investment in Team Snubbing, its equipment rental business and certain industrial real estate holdings. The rentals business is primarily focused on pressure control equipment and marketed under the Haes Rental Services branding. The high-margin, low-operating-cost rentals business provides a platform to grow to scale and positions the corporation to utilize its substantive $130-million non-capital tax loss carryforwards.

"High Arctic's board of directors and management acknowledge the robust team of employees affected and thank them for their dedicated service and commitment to operational excellence at High Arctic."

The nitrogen transaction is subject to customary commercial closing conditions and is expected to close on July 21, 2023. The net proceeds will increase liquidity as the corporation furthers its recently announced intention to undertake a return of capital to shareholders and reorganize.

About High Arctic Energy Services Inc.

High Arctic is an energy service provider. High Arctic is a market leader in Papua New Guinea, providing drilling and specialized well completion services, and supplies rental equipment, including rig matting, camps, material handling and drilling support equipment. In Western Canada, High Arctic provides pressure control equipment on a rental basis to exploration and production companies.