Weekly OFS Newsletter – DECEMBER 11, 2017

 
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OILFIELD SERVICES UPDATE

Monday December 11, 2017
News items ended December 10, 2017


Mergers and Acquisitions

 

  • Calgary, Alberta based Dynacorp Energy Services and Houston, Texas based Energes Oilfield Solutions, LLC are merging to form EnerCorp Sand Solutions, an energy services provider of sand management products and technologies. The merger strengthens the combined company’s balance sheet and provides additional growth capital for continuous product development and strategic initiatives.
  • Husky Energy Inc. (TSX:HSE) sold its Ram River sour-gas plant in the Alberta Foothills and other unspecified assets to various unidentified buyers. Due to low commodity prices, the plant has a current utilization rate of only 30% of its 400 mmcf/d capacity. Husky also sold some legacy assets in Western Canada, representing 18,000 boe/d of its gas-weighted production.

 

Financing

  • Enbridge Inc. (TSX:ENB) closed its $1.5 billion private placement of common shares. Enbridge reached subscription agreements with three large institutional investors at a price of $44.84 per common share. The gross proceeds from the private placement will be used to reduce short term indebtedness pending investment in capital projects.
  • Kinder Morgan Canada (TSX:KML) announced a $200 million stock offering to fund its Trans-Mountain pipeline expansion to the Canadian west coast, as well as to expand its Base Line terminal project in Alberta. Kinder Morgan Canada is offering 8 million common shares at $25 per share, representing a 50.5% premium to its last closing price.

 

Other

  • The Alberta government released a new greenhouse gas reduction framework for large industrial emitters, defined as facilities that emit more than 100,000 tonnes of carbon dioxide annually. The framework replaces the Specified Gas Emitters Regulation (SGER) released in 2007. The new framework is aligned with the government’s objectives to reduce emissions by 20 megatonnes in 2020 and by 50 megatonnes by 2030.
  • The Bank of Canada kept interest rates fixed at 1.0% in December 2017 while hinting that further increases are likely in the near future.
  • Tidewater Midstream and Infrastructure Ltd. (TSX:TWM) and TransAlta Corp. (TSX:TA) entered into an agreement to construct a 120-km natural gas pipeline from the former’s Brazeau River Complex to the latter’s generating units at Sundance and Keephills. The $150 million pipeline will have an initial capacity of 130 mmcf/d by 2020, with the ability to expand by an additional 340 mmcf/d. TransAlta has the option to invest up to 50% in the pipeline.
  • Calgary based Rocky Mountain GTL Inc., a subsidiary of Expander Energy Inc. is constructing Alberta’s first commercial gas-to-liquids facility that produces a clean burning, zero sulphur synthetic diesel. The facility offers technology that provides an alternative to natural gas producers having difficulty finding a market as diesel fuel prices are relatively stronger. The Alberta Energy Regulator (AER) approved the project in July 2017 that is located 60 km east of Calgary.
  • The National Energy Board (NEB) declared that Trans-Mountain Pipeline ULC is not required to comply with two sections of the City of Burnaby’s bylaws in its Trans Mountain expansion project. This decision enables the company to begin working on its infrastructure site near the Westridge Marine Terminal and at the Burnaby Terminal, subject to other permits and authorizations as required.
  • Black Diamond Group (TSX:BDI) opened its Little Prairie Lodge in Chetwynd, British Columbia to provide temporary workforce accommodation to industrial activities in the region. The lodge has a capacity of 252 rooms and increases Black Diamond’s overall capacity in the Montney and Duvernay regions to over 2,500 rooms.