Calfrac Well Services Ltd. has announced a 2011 capital budget of $280 million. The capital program will focus on further bolstering Calfrac's fracturing, coiled tubing and cementing capacity, infrastructure and logistical capabilities as it continues to expand its presence in the emerging North American unconventional oil and natural gas markets.
The Canadian division's 2011 capital budget totals $113 million, which includes the addition of approximately 91,000 hydraulic horsepower (HHP) to Calfrac's Canadian fleet. A portion of this capital is supported by a recently executed long-term agreement with one of the leading operators in the Cardium play. Upon completion of the 2011 capital program, total horsepower capacity in Canada will reach approximately 339,000 HHP.
The United States division's 2011 capital budget totals $129 million. This program includes the addition of approximately 74,000 HHP and support equipment to the company's U.S. pressure pumping fleet. The focus of this capital will be to further expand Calfrac's presence in the oil producing regions of the U.S. market. Upon completion of the 2011 capital program, Calfrac's U.S. division's total horsepower capacity will be approximately 405,000 HHP.
The Latin America division's 2011 capital budget totals $7 million, and includes the construction of additional equipment for the Colombian well service market. The entry into the Colombian market is consistent with Calfrac's geographic diversification strategy and signifies its assessment of the significant growth opportunities in the Colombian pressure pumping market.
In addition to the 2011 capital program outlined above, Calfrac expects that during the first six months of 2011 it will complete the remaining portion of its 2010 capital program with the anticipated expenditure of approximately $120 million, consisting primarily of capital associated with the construction of two large fracturing spreads to service two long-term minimum commitment contracts in the Marcellus Shale play and to supplement Calfrac's North American horsepower capacity.
About Calfrac Well Services Ltd.
Calfrac provides specialized oilfield services to exploration and production companies designed to increase the production of hydrocarbons from wells drilled throughout western Canada, the United States, Russia, Mexico, Colombia and Argentina.
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