IROC ENERGY SERVICES CORP. 
By CALGARY, Oct. 26, 2011, 2011 (Canada NewsWire via COMTEX) --
IROC Energy Services Corp. ("IROC" or the "Corporation") (TSXV: "ISC") is pleased to announce the deployment of the three new coil tubing units budgeted in our 2011 capital program, an operational update describing current conditions, progress on our 2011 capital expenditures and certain components of the 2012 capital budget.
Helix Coil Services
Helix has taken delivery of the three coiled tubing units announced in our 2011 capital budget. All of the units have a 2"capacity which places them in the intermediate size range for coil tubing. Customer demand for this size of equipment is expected to remain strong through the winter season. Two of the units were deployed during the third quarter. The third unit, which was delivered in October, has already been placed into active service and deployed in the field. These three units represent our entrance into the coil tubing business.
Eagle Well Servicing
Three months ended
September 30, June 30, March 31, December 31,
2011 2011 2011 2010
Eagle Well Servicing:
Number of service rigs 38 36 36 35
(end of period)
Service rig utilization 72% 42% 78% 66%
Three months ended
September 30, June 30, March 31, December 31,
2010 2010 2010 2009
Eagle Well Servicing:
Number of service rigs 35 35 36 36
(end of period)
Service rig utilization 57% 33% 55% 49%
As at September 30, 2011, Eagle had a fleet of 38 service rigs. Utilization, as measured by IROC's internal methodology, during the quarter was 72%. Eagle's service rig fleet and equipment is amongst the newest in the industry. Since September, the Corporation has deployed one additional rig, for a total service rig fleet of 39 rigs currently crewed and operated. In addition, 3 new service rigs are currently being built, with expected delivery in 2011. As part of these deliveries, Eagle's first 2 slant rigs are being delivered in November allowing the company to address opportunities in the heavy oil and SAGD markets. Management expects that our full 2011 capital expenditure budget of $27.6 million will be expended by yearend.
Additionally, we have budgeted $12.5 million and secured five new build slots for our 2012 capital program. The five additional rigs are expected to be deployed between December 2011 and June 2012, meaning that Eagle Well Servicing expects to have 43 rigs operational by year end and 47 rigs operational by the end of the second quarter of 2012. Orders for the 2012 service rigs were placed to ensure increasing lead times for delivery of certain service rig components do not delay delivery of the new rigs from our anticipated time schedule. Our full 2012 capital budget is expected to be released prior to yearend.
The trend toward increased oil related activity continues to provide benefit for our service rig division. Current activity levels are estimated to be approaching 80% levered to oil, with completion, work over and abandonment activity all providing continued strong demand for our services in the foreseeable future.
Eagle Well Servicing has been able to fully crew its assets through the third quarter of 2011, despite a very tight labour market across the service industry.
Aero Rental Services
With the increase in drilling and field service activity in the last 12 months, IROC's rental services division remains strong and continues to grow. The increase in horizontal and SAGD drilling activity in Western Canada has been the main driver of growth in Aero's business. This has been complemented by increased fracturing and coil tubing related business which was an area Aero targeted for growth when Aero acquired the rental assets of Trust Energy Services in the third quarter of 2010.
Aero continues to increase its capital assets through targeted equipment purchases aimed at meeting current or anticipated customer demand.
Canada Tech
During July IROC sold the operating assets and business of Canada for $4.8 million with IROC retaining an additional $1.2 million in working capital. While Canada Tech remained a viable operation with over $10 million in sales last year, the division was underperforming in relation to our other businesses and a decision was made to sell the division and deploy the capital into the other more rapidly growing areas of our business.
Updated Corporate Presentation
An Updated Corporate Presentation has been posted to the Corporation's website at www.iroccorp.com.
About IROC Energy Services Corporation
IROC Energy Services Corp. is an Alberta oilfield services company that, through the IROC Energy Services Partnership, provides a diverse range of products, services and equipment to the oil and gas industry that are among the newest and most innovative in the WCSB. IROC Energy Services Partnership operates under the business names of Eagle Well Servicing, Aero Rental Services and Helix Coil Services. IROC combines cutting-edge technology with depth of experience to deliver a product and services offering in the following core areas: well servicing & equipment, rental services and coil tubing services. For more information on IROC Energy Services Corp., visit our website at www.iroccorp.com.
Cautionary Statement Regarding Forward Looking Information and Statements
Certain information contained in this news release, including information related to the Corporation's level of service rig utilization, future capital expenditures, anticipated equipment counts and information or statements that contain words such as "forecasted", "could", "should", "can", "anticipate", "expect", "believe", "will", "may", "likely", "estimate", "predict", "potential", "continue", "maintain", "retain", "grow", and similar expressions and statements relating to matters that are not historical facts, constitute "forward-looking information" within the meaning of applicable Canadian securities legislation. This information or these statements are based on certain assumptions and analysis made by the Corporation in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances, and the statements contained in this news release speak only as of the date hereof.
Whether actual results, performance or achievements will conform to the Corporation's expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results to differ materially from the Corporation's expectations. Such risks and uncertainties include, but are not limited to: fluctuations in the price and demand for oil and natural gas; fluctuations in the level of oil and natural gas exploration and development activities; fluctuations in the demand for well servicing and ancillary oilfield services; capital market liquidity available to fund oil and gas exploration and development programs; the effects of seasonal and weather conditions on operations and facilities; the highly competitive operating environment inherent in well servicing and ancillary oilfield services; general economic, market or business conditions; changes in laws or regulations; the availability of qualified operational and management personnel; currency exchange and interest rate fluctuations; uncertainties associated with regulatory approvals; uncertainty of government policy changes; uncertainties associated with credit facilities and counterparty credit risk; changes in income tax laws or changes in tax laws, crown royalty rates and incentive programs relating to the oil and gas industry; risks associated with government regulations and environmental health and safety matters; and other unforeseen conditions which could impact the use of equipment and services supplied by IROC.
Consequently, all of the forward-looking information and statements made in this news release are qualified by this cautionary statement and there can be no assurance that the actual results will be realized. Except as may be required by law, the Corporation assumes no obligation to update publicly any such forward-looking information and statements, whether as a result of new information, future events, or otherwise.
Other
This press release is not for dissemination in United States or to any United States news services. The Common Shares of IROC have not and will not be registered on the United States Securities Act of 1933, as amended (the "United States Securities Act") or any state securities laws and are not offered or sold in the United States or to any US person except in certain transactions exempt from the registration requirements of the United States Securities Act and applicable state securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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SOURCE: IROC Energy Services Corp.
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