CALGARY, Dec. 7, 2017 /CNW/ - Western Energy Services Corp. ("Western") (TSX: WRG) is pleased to announce its 2018 capital expenditure budget of approximately $20 million, including capital spending carried forward from 2017 of approximately $2 million. The 2018 capital expenditure budget is expected to be comprised of $12 million of maintenance capital and $8 million of expansion capital.
Maintenance capital of $12 million includes $9 million in the contract drilling segment and $3 million in the production services segment. Western continually monitors the activity of its fleet and will adjust the planned 2018 maintenance capital as warranted.
Expansion capital of $8 million is driven by specific customer requirements, which include upgrades for Western's contract drilling fleet and additional oilfield rental equipment for Western's rental division, Aero Rental Services. Western remains committed to ensuring that funds will only be allocated to projects where capital can generate appropriate returns.
Western expects that its 2018 capital budget will contribute to the preservation of its balance sheet. The planned spending further demonstrates Western's commitment to maintaining its premier drilling and well servicing rig fleets, while responsibly allocating expansion capital to maximize stakeholder returns.
Western is an oilfield service company which provides contract drilling services in Canada through its Horizon Drilling division and in the United States through its wholly-owned subsidiary, Stoneham Drilling Corporation. In Canada, Western also provides well servicing through its Eagle Well Servicing division and provides oilfield rental services through its Aero Rental Services division.
Forward Looking Statements and Information
This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "will" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward-looking statements and information relating to Western's planned capital expenditures and expectations of balance sheet preservation. These forward-looking statements and information are based on certain key expectations and assumptions made by Western. Although Western believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information as Western cannot give any assurance that they will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with general economic conditions, the demand for Western's services, volatility in market prices for oil and natural gas and the effect of this volatility on the demand for oilfield services generally, currency exchange rate risk, compliance with covenants and/or repayment obligations under the Credit Facilities and the indenture governing the Senior Notes, changes in legislation, dependence on, and concentration of, major customers, and the creditworthiness and performance by the Western's counterparties and customers.
Readers are cautioned that the foregoing list of risks and uncertainties is not exhaustive. Additional information on these and other risk factors that could affect Western's operations or financial results are included in Western's annual information form and may be accessed through the SEDAR website (www.sedar.com). The forward-looking statements and information contained in this press release are made as of the date hereof and Western does not undertake any obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
SOURCE Western Energy Services Corp.
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