ST. ALBERT, ALBERTA--(Marketwired - May 27, 2014) - Enterprise Group, Inc. ("Enterprise," or the "Company") (TSX:E) is pleased to announce that Hart Oilfield Rentals Ltd. ("Hart"), a recently acquired subsidiary of the Company, has renewed its Master Service Agreement ("MSA") with Canada's largest natural gas producer. This MSA has a value of $19.2 million and a term of two years, an increase relative to prior single year agreements. The MSA confirms the commitment for a steady supply of equipment and labour created by the producer's aggressive drill program.
This MSA is effective immediately, and will utilize all of Hart's existing equipment lines. These lines include Hart's patented combo units, which provide a full range of equipment and service offerings to their customers. The MSA also includes a provision for transportation and the set-up of the units, in addition to labour utilization. This service component of the MSA reflects Hart's competitive advantage in the industry. While scope of the MSA spans various geographies, the majority of work will take place within the very active Valleyview, Pouce Coupe, Grande Prairie, and Rocky Mountain House locations, which will serve the Clearwater, Duvernay, Bighorn CutBank Ridge, Horn River, and Peace River producing regions.
Hart's ability to fulfill the demands of this MSA is a result of Enterprise's capital expenditure program for 2014, which will utilize proceeds from the $27.6 million financing the Company completed in March of 2014. $10.0 million of the Company's capital program has been devoted towards equipment purchases for Hart. The Company anticipates that these purchases will be complete by October of 2014. The majority of these purchases are innovative equipment that includes two custom designed 'hook trucks,' which will facilitate rapid and efficient movement of Hart's combo units via patented hook technology.
"The acquisition of Hart has allowed Enterprise to establish a position as a rapidly emerging player within the oilfield service industry," stated Leonard Jaroszuk, the Company's President and Chief Executive Officer. "While Hart's contribution to our business was clearly evident within our recent first quarter results, its true value will be demonstrated by contracts like this one. Our confidence is further bolstered by Hart's ability to leverage its existing relationship with this client, Canada's largest natural gas producer, a company poised to execute a robust drilling program over the next five years. This contract is a strong signal that Enterprise will play a role in the execution of that program, and I expect that several segments of our business will benefit as a result."