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Under the terms of the contract, Key will initially provide three well service rigs outfitted with its proprietary KeyView(R) system and will install two KeyView systems on PEMEX-owned well service rigs. The contract grants PEMEX the option to call for additional rigs and KeyView systems in the future, although these incremental services are not included in the $45.8 million award. The Company anticipates that it will commence operations in Mexico during the second quarter.
The current project will cover PEMEX's North Region assets and will initially focus on oil wells in the Poza Rica, Altamira and Cerro Azul assets. Depending on the success of the initial project, potential expansion opportunities into the Veracruz and Reynosa fields in the north plus the entire PEMEX Southern Region out of Villa Hermosa, Tabasco, may be possible.
Dick Alario, Key's Chairman and CEO, stated, "We are very excited to have the opportunity to work with PEMEX and especially enthused that the contract was awarded to us via a direct assignment signifying that Key Energy Services is the only company capable of providing these well enhancement solutions using our KeyView technology. Our objective is for this project to enhance Key's position for future opportunities with PEMEX."
Mr. Alario continued, "We are in discussions with other international operators about our proprietary technology products and believe that our technology, combined with our workover expertise, is of great value to international operators like PEMEX."
Key Energy Services, Inc. is the world's largest rig-based well service company. The Company provides oilfield services including well servicing, pressure pumping, fishing, electric wireline and rental tools and other oilfield services. The Company has operations in all major onshore oil and gas producing regions of the continental United States and internationally in Argentina.
Certain statements contained in this news release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about the Company, the Company's industry, management's beliefs and certain assumptions made by management. Whenever possible, the Company has identified these "forward-looking statements" by words such as "expects," "believes," "anticipates" and similar phrases. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict, including, but not limited to: uncertainties affecting the value of the contract with PEMEX, including whether the Company is awarded any bids to provide incremental services; uncertainties surrounding the Company's ability to protect its patented technology; risks affecting the ability of the Company to maintain or improve operations, including the ability to maintain price increases; possible over supply of new rigs coming into the market and weather risks; risks associated with technology investments and the receptiveness of customers to the new technology investments; risks that the Company will be unable to achieve budgeted financial targets and risks affecting activity levels for rig hours including the risk that commodity prices decline or the risk that capital budgets from the Company's customers decrease; risks that the Company will not be able to successfully market proprietary technology products to other international operators; and risks that the uncertainties surrounding the Company's financial statements will affect operations. Because such statements involve risks and uncertainties, the actual results and performance of the Company may differ materially from the results expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Unless otherwise required by law, the Company also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made here; however, readers should review carefully reports or documents the Company files periodically with the Securities and Exchange Commission.
Source: Key Energy Services, Inc.
CONTACT: John Daniel of Key Energy Services, Inc., +1-713-651-4300
Web site: http://www.keyenergy.com/
Copyright © 2006 PR Newswire Association LLC. All rights reserved.
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