2022-08-02 | TSX:HWO | Press release
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CALGARY, Alberta, Aug. 02, 2022 (GLOBE NEWSWIRE) — High Arctic Energy Services Inc. (TSX: HWO) “High Arctic” or the “Corporation” is pleased to announce that it has agreed terms with its major client in Papua New Guinea (“PNG”) for a three-year contract renewal covering the services of the 103 heliportable drilling rig and the High Arctic contracts related to the provision of personnel, camp accommodations and rental equipment to support drilling operations come into effect on August 1, 2022 and include options to extend the contracts under the same terms and conditions to the beyond July 31, 2025.
At the end of 2021, High Arctic’s main client PNG merged with one of the largest energy exploration and production companies operating in Asia-Pacific, to create a regional champion in quality, size and depth. ‘ladder. Both companies have a long history in PNG. The resulting company holds significant interests in both LNG projects as well as operating all of PNG’s producing oilfields and several gas fields supplying the existing PNG-LNG export facility.
Mike Maguire, CEO of High Arctic, said, “High Arctic has worked continuously with this primary client since arriving in Papua New Guinea in 2007. Together we have forged a strong partnership that has set the benchmark for safe and efficient operations in remote areas and logistically challenging PNG environment. We are proud to have continued our strong symbiotic relationship in supporting their field operations through the challenges posed by Covid-19 and the recent ownership transition. We are delighted to work closely with the new management team and are proud to remain their drilling services company of choice in PNG.”
Key technical personnel have begun deployment and work is underway to prepare the 103 drilling rig and its leapfrog unit for the resumption of drilling in early Q4 2022. The terms of the contract renewals are substantially similar to those contained in previous contracts. This fundamental contract is flexible and scalable to align with the business which positions High Arctic to respond quickly to future additional drilling opportunities.
This contract announcement follows recent positive developments that highlight the huge potential for LNG production expansion in PNG. On July 20, 2022, TotalEnergies, operator of the Papua-LNG joint venture, announced the start of FEED upstream studies in PNG aiming for a final investment decision on the project of two Papua-LNG trains by the end of 2023, and the start of production in 2027. Earlier this year, ExxonMobil, operator of the PNG-LNG joint venture, announced the signing of a gas agreement for the development of the P’nyang gas field in the western province of PNG, which should cause another train to be added to the world-class PNG-LNG export facility.
Mike Maguire, CEO of High Arctic, said, “Papua New Guinea is key to High Arctic’s long-term business strategy. Significant LNG investments have been made in PNG by major oil and gas companies. High Arctic is well positioned to support future investment given the high barriers to entry due to the technical expertise required to operate heli-borne drilling rigs in remote locations. High Arctic’s contract drilling services history in PNG includes our major long-term client and the two large multinational companies operating the two LNG project joint ventures, among others. We are currently providing services to both our major customer and operator PNG-LNG, and we are happy to resume consistent drilling operations.”
All rigs in High Arctic’s custody have been serviced during the Covid-19 induced PNG drilling suspension and are in good condition for rapid redeployment into service. These include our major customer’s other 104 heliportable drilling rig, High Arctic’s 115 and 116 multi-purpose heliportable drilling rigs and our large capacity Rig 102 heliportable hydraulic workover unit.
This press release contains forward-looking statements. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “seek”, “propose”, “estimate&CloseCurlyDoubleQuote ;, “expect”, and similar expressions are intended to identify forward-looking statements. Such statements reflect the Company’s current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of the Company to differ from those described in this press release.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may differ materially from those described in this press release as anticipated, planned, anticipated, believed, estimated or expected. Specific forward-looking statements contained in this press release include, but are not limited to, statements relating to the following: for the resumption of drilling early in the fourth quarter of 2022, tremendous potential for LNG production expansion in PNG, a final investment decision on the Papua-LNG project by the end of 2023, the addition of another train at the world-class PNG-LNG export facility, the rapid redeployment of the -forms under the control of High Arctic and the return to consistent drilling operations.
The Company’s actual results could differ materially from those anticipated in these forward-looking statements due to the risk factors set forth above and elsewhere in this press release.
The forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. These statements speak only as of the date of this press release. The Company undertakes no obligation to update these forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law.
About the High Arctic
High Arctic is an energy service provider. High Arctic is a market leader in Papua New Guinea, providing specialist well drilling and completion services and providing rental equipment including drill mats, camps, handling and support equipment to the drilling. In Western Canada, High Arctic provides nitrogen services and rental pressure control equipment to a number of exploration and production companies.
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High Arctic Energy Services Inc.