Whitehorn OFS Newsletter – November 27, 2017

 
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OILFIELD SERVICES UPDATE

Monday November 27, 2017
News items ended November 26, 2017


Mergers and Acquisitions

 

  • Civeo Corp. (NYSE:CVEO) announced the $367 million acquisition of Noralta Lodge Ltd., a Nisku, AB based accommodations provider to the Canadian oil sands region. The acquisition strengthens Civeo’s workforce accommodations offering with complimentary locations and is expected to generate annual synergies of $10 million by 2019. The acquisition comprises $210 million in cash, with the remaining in common shares and non-voting convertible preferred equity.
  • MATRRIX Energy Technologies Inc. closed its previously announced $9 million acquisition of Stampede Drilling Ltd., a Saskatchewan based drilling rig contractor. MATRRIX acquired all of Stampede’s outstanding Class A and B common shares for $7 million, while assuming $2 million of debt.
  • Red Deer, AB based Predator Drilling LLC, a subsidiary of Predator Drilling Inc. announced the acquisition of Midland, TX based J.B. Hunt Gas and Oil Drilling in an all equity transaction. The acquisition includes six single drilling rigs, equipped with automation and safety systems. The acquisition will help enhance and elevate Predator’s market share in the drilling industry.

 

Financing

  • MATRRIX Energy Technologies Inc. closed its previously announced private placement of its common shares on a best efforts basis for an aggregate consideration of $20 million. MATRRIX issued 64.52 millionshares priced at $0.31. MATRRIX intends to use the proceeds for debt repayment, capital expansion and for working capital purposes.
  • Precision Drilling Corp. (TSX:PD) closed its previously announced offering of USD $400 million in senior notes at 7.125% due in 2026. Net proceeds from the offering, along with cash on hand will be used to repurchase its USD$372 million senior notes due in 2020 and USD $70 million senior notes due in 2021.

 

Other

  • The Canadian Association of Oilwell Drilling Contractors (CAODC) is forecasting the number of wells drilled in 2018 at 6,138, an increase of 107 or 1.8% from 2017 levels (6,031). Projected operating days in 2018 are 70,587 compared to 2017’s 69,353, an increase of 1,234. The rig fleet is predicted to decrease from 634 drilling rigs in 2017 to 615 in 2018.
  • The continued shutdown of TransCanada Corp.’s (TSX:TRP) Keystone pipeline after a site spill in South Dakota has caused Canadian heavy crude differentials to widen. The shutdown has increased concerns regarding a supply glut of crude building up in Alberta. TransCanada has not provided a date on when shipments will resume on its 590,000 bbl/d pipeline.