oilfield services quarterly update q1 2019€¦ · on april 30, 2019, bill 12 was proclaimed...

QUARTERLY UPDATE Q1 2019

OILFIELD SERVICES

OIL AND GAS POLITICAL CLIMATE

BILL 12

A controversial piece of legislation, Bill 12 was passed but not proclaimed by the previous Alberta NDPgovernment as potential leverage in negotiating with B.C. over its opposition to pipe lines. Bill 12 providesthe Alberta government new authority to require companies to obtain a license before exporting oil or gasfrom Alberta via pipeline, rail or truck or face substantial financial penalties.

On April 30, 2019, Bill 12 was proclaimed immediately following the swearing in of Alberta Premier Kenney’scabinet. B.C.’s Attorney General David Eby promised to file a court challenge against this legislation, claimingit is unconstitutional to restrict the flow of refined products between provinces. B.C.’s Green Party LeaderAndrew Weaver also noted potential issues with NAFTA.

As of May 1, 2019, Alberta Premier Kenney has not said whether or not the measures in the bill will beenforced. It remains to be seen how effective this will be as a legal manoeuvre or a political tactic.

BILL C-69

On May 1, 2019, federal Environment Minister Catherine McKenna added in-situ facilities to the list ofprojects that would be subject to federal environmental reviews under proposed Bill C-69. These projectswould be exempt from review if Alberta continues to limit annual provincial oilsands related emissions to100 megatonnes.

NEW LEADERSHIP IN ALBERTA – THE UCP’S PLATFORM

The UCP published a 114-page document outlining the party’s plan once elected. Highlights impacting theenergy sector include:

• Cutting the carbon tax completely• Introducing a law that will guarantee the royalty regime in place when a well is drilled will remain in

place for that well in perpetuity• Reclassifying service rigs as off-road vehicles• Appointing new directors to the board of the Alberta Energy Regulator (AER)• Replacing rural road permits with an annual provincial permit• Reducing the corporate tax from 12% to 8%• Implementing the new Technology Innovation and Emissions Reductions (TIER) Fund• Implementing the “Red Tape Reduction Action Plan” which will reduce red tape by one-third and in turn

reduce costs and speed up approval processes

Additional action to watch out for:

• Efforts to counter the attempts by foreign-funded activist groups to stall the development of Canadianenergy infrastructure.

Sources:UCP Platform: Getting Alberta Back to Work - https://www.albertastrongandfree.ca/policy/Edmonton Journal: 'This law is unconstitutional': B.C. to take Alberta to court after Kenney proclaims 'turn off the taps' legislation

INDUSTRY OVERVIEWM&A TRANSACTIONS & PERFORMANCE

15.7B

29.1B 24.4B 22.7B

7.6B

32.0B

10.8B

23.6B

5.0B

40.0B

27.3B

8.1B

49

90

83 80

51

118 101

76 64

107

60 47

-

20

40

60

80

100

120

140

-

5

10

15

20

25

30

35

40

45

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2016 2017 2018 2019

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Transaction value Transaction volume

SHARE BUYBACK ANNOUCEMENTS / COMPLETIONS

Crescent Point Energy Corp. (Crescent Point) announced on January 23, 2019 the Toronto Stock Exchange(TSX) accepted Crescent Point’s notice to implement a normal course issuer bid to purchase, for cancellation,up to 38,424,678 common shares, or 7% of the company's public float, as at January 14, 2019. The normalcourse issuer bid is scheduled to commence on January 25, 2019 and is due to expire on January 24, 2020.

Enerplus Corporation (Enerplus) announced on February 22, 2019 that during 2018 Enerplus repurchased5,925,084 shares at an average share price of $13.33 and a cost of $79.0 million. Subsequent to 2018 and upto February 20, 2019, Enerplus spent $6.7 million repurchasing 586,953 common shares at an average price of$11.40.

Encana Corporation (Encana) announced on February 27, 2019 that the TSX accepted their normal courseissuer bid in which Encana can purchase up to 149,425,839 common shares during the 12-month periodcommencing March 4, 2019 ending March 3, 2020.

Source: Capital IQ. Data as of March 31, 2019. Note: oilfield services transactions include companies with head offices in other countries.

AMERICAN E&P TRANSACTIONS

CANADIAN E&P TRANSACTIONS

3.4B 3.2B5.2B

21.9B

2.2B3.9B

1.4B0.3B

4.8B

1.7B 1.0B 0.2B

36

28 27 32

37

24

30

21

32

29

32

21

-

5

10

15

20

25

30

35

40

-

5

10

15

20

25

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2016 2017 2018 2019

Tran

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Tran

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INDUSTRY OVERVIEWM&A TRANSACTIONS & PERFORMANCE

61

194

512

1,196

237

25

518

22

173

1,048

1,288

342

5

9 10

8 5

3

5

6

4

10

8

8

-

2

4

6

8

10

12

-

200

400

600

800

1,000

1,200

1,400

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2016 2017 2018 2019

Tran

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Tran

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Mill

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s)


Source: Capital IQ. Data as of March 31, 2019. Note: oilfield services transactions include companies with head offices in other countries.

CANADIAN OILFIELD SERVICES TRANSACTIONS

Top Transactions of Q1-2019:1. Shawcor Ltd. acquired ZCL Composites Inc. in January for approximately $312 million.2. PVT Group acquired Rockwater Energy Solutions Canada in March for an undisclosed amount.3. Aureus Energy Services Inc. acquired Amperage Energy Inc. in February for an undisclosed amount.

Observations:1. TPG Capital LLC entered into a definitive agreement on March 11, 2019 to acquire Goodnight

Midstream LLC for $1.25 billion.2. Tenaris S.A. entered into a definitive agreement on March 22, 2019 to acquire IPSCO Tubulars Inc. for

$1.72 billion representing a 7.7 x EV/EBITDA multiple.

10,437

1,296

9,126

588 1,… 3,6644,264 3,533

25,562

94,240

2,1553,721

11

34

24

19

11

35

25 27

18 24

27 28

-

5

10

15

20

25

30

35

40

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2016 2017 2018 2019

Tran

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Tran

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AMERICAN OILFIELD SERVICES TRANSACTIONS

MNP INSIGHTSALBERTA PRODUCTION CURTAILMENT

$0

$10

$20

$30

$40

$50

$60

$70

$80

$U

S/b

bl

WTI VERSUS WCS

WCS WTI Spread

On December 2, 2018, the government of Alberta announced a mandatory production curtailment to reduceAlberta’s oil production by 8.7%, starting January 1, 2019.

The announcement came in response to the growing differential between the Western Canadian Select (WCS)pricing Alberta producers receive compared to West Texas Intermediate (WTI) pricing received by U.S.producers.

At the time of announcement, Alberta was producing 190,000 barrels a day more than could be shipped usingexisting pipeline and rail capacity.

OVERVIEW

• The AER is administering the reduction using the existing Responsible Energy Development Act.• The initial curtailment of 325,000 barrels per day (8.7%) is expected to drop over the course of 2019. The

government will review the amount every month and adjust as needed.• Curtailment includes an exemption for the first 10,000 barrels of oil produced by any producer.• On January 30, 2019 the Alberta government announced they would reduce the curtailment by 75,000

barrels per day.

Source: Alberta Government website (https://www.alberta.ca/release.cfm?xID=621526E3935AA-08A2-6F45-72145AEBDF115BDF)

Q1 Activity

December Curtailment Decision

https://www.alberta.ca/release.cfm?xID=621526E3935AA-08A2-6F45-72145AEBDF115BDF

SELECT RECENT M&A TRANSACTIONSINDUSTRY OVERVIEW

Source: Capital IQ and company websitesNote: In $CAD unless otherwise stated

Closed Feb 13, 2019

TEV Undisclosed

TEV/EBITDA Undisclosed

TEV/Revenue Undisclosed

Acquired

Closed Apr 4, 2019

TEV Undisclosed



Acquired

Acquired

Closed Apr 2, 2019

TEV $312 M

TEV/EBITDA 12.5 X

TEV/Revenue 1.7 X

• On February 13, 2019 Aureus Energy Services Inc.(“Aureus”) has acquired all of the outstandingshares of Amperage Energy Inc.

• Jason Tocheniuk, Founder and CEO of Aureuscommented “I am extremely pleased that bycombining Aureus and Amperage, we are able toprovide our customers with a comprehensiveservice offering across the full life cycle of waterand industrial fluids.”

• Tally Energy Services acquired Epic Lift Systemswhich provides plunger lift, gas lift andcomplementary compression solutions, servinghundreds of customers from 16 locations across theU.S.

• “Our mission is to make better wells by deliveringaccurate wellbore placement, effective stimulation,and production optimization of the reservoir. Epicwill be the cornerstone of the production aspect ofour strategy.” said Chris Dorros, CEO of Tally EnergyServices.

• On January 20, 2019 Shawcor entered into anarrangement agreement to acquire all of the issuedand outstanding shares of ZCL Composites Inc.(“ZCL”) (TSX: ZCL) for $10.00 per share in cash . Theprice per share implies an aggregate fully dilutedequity value for ZCL of approximately $312 million.

SELECT RECENT M&A TRANSACTIONSINDUSTRY OVERVIEW

Source: Capital IQ and company websitesNote: In $CAD unless otherwise stated

Acquired

Closed Mar 25, 2019

TEV Undisclosed



Closed Apr 16, 2019

TEV $8.25 M



• The acquisition provides High Arctic Energy ServicesInc. (“High Arctic”) with twelve additional marketedsnubbing units, seven of which have been active overthe last twelve months, as well as certain patent rightsrelated to the design and configuration of stand-alonesnubbing units and spare equipment.

• High Arctic operates the largest snubbing fleet inCanada consisting of a total of 29 snubbing units. OfHigh Arctic’s total fleet of snubbing units, five arecurrently being marketed in the United States and anadditional three units will be deployed for well serviceand completion work in the Niobrara and the Bakken.

Acquired certain assets from

• PVT Group completed the acquisition of RockwaterEnergy Solutions Canada Inc. (“Rockwater”) on March25, 2019.

• Rockwater provides fluids logistics services to oil andgas industry through tank trucks, vacuum trucks, hydrovac trucks, hot oilers, winch trucks, and pressuretrucks. Additionally, it offers water transfer,containment, and other rental services throughoutWestern Canada. The company is based in DawsonCreek, Canada.

MACRO ECONOMIC INDICATORS INDUSTRY OVERVIEW

0

200

400

600

800

1,000

1,200

Tota

l Rig

s

TOTAL RIG COUNT: CANADA VS. UNITED STATES

Canada United States

Source: Government of Alberta, B.C. and Saskatchewan; Data as of March 31, 2019.

Q1 Activity

$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000

0

500

1,000

1,500

2,000

2,500

2013 2014 2015 2016 2017 2018 2019 Q1

Avg

$/H

a

In 0

00

s H

ecta

res

Sold

OIL & GAS LAND SALES - ALBERTA, B.C. AND SASKATCHEWAN

British Columbia Saskatchewan Alberta

AB Avg$/Ha SK Avg$/Ha BC Avg$/Ha

MACRO ECONOMIC INDICATORS INDUSTRY OVERVIEW

1.50 1.78 6.99

19.93

-3.46 4.46

1.00

13.38

-

5.77

10.33

0.95

6.89

1.08

5.18

3.75

3.73

1.00

28.39

15.14

12.95

12.11

5.78

0.94

1.25

9.25

8.19

329

203 233

235

163

28

-

50

100

150

200

250

300

350

2014 2015 2016 2017 2018 2019

-

10

20

30

40

50

60

Tran

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$C

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Cenovus Energy Inc. Canadian Natural Resources Limited Suncor Energy Inc. Husky Energy Inc.

All other players Encana Corporation Transaction volume

433498 469

946

0

200 150

600

5891,875

360

2,015

1,954

312

57

429 150

62

52

65 69

34

4

-

10

20

30

40

50

60

70

80

2014 2015 2016 2017 2018 2019

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Tran

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Vo

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um

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of

tran

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Tran

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$C

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Precision Drilling Corporation Shawcor Ltd. CES Energy Solutions Corp. Trinidad Drilling Ltd.

All other players Mullen Group Ltd. Transaction volume

Source: CAPIQ. Data as of March 31, 2019.Note: data does not contain share buy-backs.

• In Q1 2019, North American Construction Group announced a $55 million boughtdeal offering of 5% Convertible Unsecured Subordinated Debentures convertible at$26.26 per share.

• Total capital raised of $57 million capital raised in Q1 2019 vs $116 million in Q12018.

OFS Capital Raised

• Husky was the only major player raising capital in Q1 2019.

• Total capital raised of $24.7 billion in 2018 vs. $50.1 billion in 2017.E&P Capital Raised

CANADIAN OILFIELD SERVICES - PRIVATE PLACEMENTS, PUBLIC OFFERINGS AND SHELF REGISTRATIONS

CANADIAN E&P – PRIVATE PLACEMENTS, PUBLIC OFFERINGS AND SHELF REGISTRATION

INDUSTRY OVERVIEWINDUSTRY INSIGHTS

Daryl Medd, President, Rangeland Truck & Crane Ltd.What was the most positive change in the last 12 months for your business?We are mostly, but not exclusively, an oil and gas services company. The most positive changemust be the result of the Alberta election. It’s the hope that kept us motivated to work throughthe difficulties of the past four years. Of course, the language has changed now that thecampaign is over, but we’ve turned a corner and there’s more optimism on this road.

What was the most negative change in the last 12 months for your business?The most negative change has been the increased carbon tax. It’s a direct cost that we can’t passthrough to our customers given the price pressure on our industry segment. We cite that first,because there’s been no change in the pipeline delays. We know we produce oil and gas to thehighest environmental standards in the world,and with the highest regard for social responsibilityand human rights. It’s frustrating to be on the bench while less conscientious countries competeto supply increasing world demand and enjoy increasing energy prices.

What is your outlook for the next 12 months?The next 12 months will be interesting. I think we’ll see optimism continue to improve, but nopivotal changes in economic conditions for about a year. We’ve been in a fight for our industryand didn’t see the ground we were losing. We’ll see our politicians begin to defend againstfurther loss, but we won’t regain our deserved reputation for decades. Much of the positiveimage oil and gas deserves can only be earned back by the industry, not won in a fight bypoliticians. As providers to the industry we’ll have to ensure that our clients, vendors and allother observers witness our sincere efforts to be environmentally responsible. It’s part of ournational culture and identity, and we’re proud to carry it into our workplaces. We do it notbecause of regulatory requirement, but because we truly believe in it. Going forward, we will beless humble while sharing that story with Canadians and the world.

While our domestic industry rebuilds, our business will have to continue diversifyinggeographically to capture the best opportunities. We’ll continue to pursue as many new U.S.customers as we can and earn American dollars. This could include setting up a U.S. corporationand offices.

Richard Hansen, President, Sky Eye MeasurementWhat was the most positive change in the last 12 months for your business?The most positive change for Sky Eye in the last 12 months is our ability to find new markets inthe U.S. and Mexico. This has enabled us to double our staff last year in both Edmonton andCalgary, keeping our talented people employed in Alberta. This has allowed us to share ourinnovative products and expertise throughout North America.

What was the most negative change in the last 12 months for your business?The most negative change for Sky Eye in the last 12 months has been our decline in domesticsales. We are now starting to see a positive change in industry hopefully this will continue intothe fall of 2019.

What is your outlook for the next 12 months?Our outlook for the next 12 months is very positive. We plan to grow our brand throughout U.S.and Mexico while maintaining an approach to increasing work in Canada.

INDUSTRY OVERVIEWINDUSTRY INSIGHTS

Ashley Raabis, Vice President Corporate SalesWhat was the most positive change in the last 12 months for your business?With less volume of work, it has allowed us some time to internally reflect, evaluate and reset asa company. We were able to refocus on our core values and our people which have enabled us tosurvive the very difficult challenges of the past three years. Being nimble, we have been able toincrease our market share in the oil and gas sector while also aggressively pursuing opportunitiesin other markets to fill the gaps, which has and will continue to help us grow as a companymoving forward.

What was the most negative change in the last 12 months for your business?The biggest negative is that we are still in a war of attrition environment – companies in theenergy sector are still in survival mode. The volume of work across Western Canada is still lowwith a majority of activity being in the Montney/Duvernay plays. More and more companies havebeen forced to try and win work in this relatively small regional area. This has increased thepressure on all companies in their fight for survival as there is nowhere else to hunt for work atthis time.

What is your outlook for the next 12 months?We are cautiously optimistic. The consensus with our industry peers is that the volume and rateof opportunities has stabilized somewhat and is no longer decreasing. We are hopeful that withsome changes in government and new policies being put in place, that Western Canada will beviewed as positive place to do business again. Once the investment starts to return we will feel alot more positive about the health of our industry and with that, confident that we are in aposition to grow and expand with the new and increasing demand.

Terry Bendera, President, Prostar EnergyWhat was the most positive change in the last 12 months for your business?We have seen signals from the energy sector that the future is ready for innovation. Rather thanreplacing petroleum products, the future is in being more responsible. Taking proactive stepstowards being responsible starts with subject matter experts, not with governments or withgroups with financial motivations. So the positivity we see at Prostar is that through our data andanalytics we can prove that we are safer, more environmentally responsible and can achieveimproved production. This has always been thought to be a one or the other conversation.

What was the most negative change in the last 12 months for your business?I would say now that we are stabilizing at above USD$60 per barrel (WTI), we in the service arenaare still being held captive by low rates. The slow rise back from low utilization is one of thereasons, but others are also evident; while energy companies announce record profits, the lengthof the downturn, and uncertainty around governments has resulted in a slow return toreasonable pricing.

What is your outlook for the next 12 months?With the uncertainty surrounding governments, lack of pipelines and no direct plan to get ourvaluable product to tidewater, it’s proving to be a very challenging market. I believe this year isabout a correction to the market place, righting the ship and in saying that, a return to greatness!Canada will flourish as a result by having financial independence to provide world class healthcare and education all while enjoying the quality of life that puts Canada at the top. We will dothis while providing the most environmentally responsible energy source and reducing dirtyenergy. Lets put the future back in the hands of responsible subject matter experts!

PUBLIC COMPARABLE ANALYSISPERFORMANCE ANALYSIS

16.20x

6.35x

8.32x

13.71x

7.50x

9.62x

11.24x

5.0x

7.0x

9.0x

11.0x

13.0x

15.0x

17.0x

19.0x

21.0x

Oil and Gas Drilling Oil and Gas Field Services Oil and Gas Machinery and Equipment

Oil and Gas Storage and Transportation Integrated Oilfield Services Camp Accomodations

Oil and Gas Software Solutions

44.28%

-20.64%

13.55%

-17.77%

-34.80%

-34.18%

-14.30%

-60%

-40%

-20%

0%

20%

40%

60%

Oil and Gas Drilling Oil and Gas Field Services Oil and Gas Machinery and EquipmentOil and Gas Storage and Transportation Integrated Oilfield Services Camp AccomodationsOil and Gas Software Solutions

Source: Capital IQ. Data as of March 31, 2019.

OILFIELD SERVICE GROUP SHARE PRICES

OILFIELD SERVICE GROUP TEV/EBITDA

PUBLIC COMPARABLE ANALYSISGROWTH, MARGINS & MULTIPLES

8.6x

9.1x

12.2x

7.0x

13.2x

12.0x

10.5x

0.0x 5.0x 10.0x 15.0x

Drilling

Field Services

Machinery and Equipment

Integrated Oilfield Services

Storage and Transportation

Camp Accomodation

Software Solutions

7.0x

3.9x

8.8x

4.2x

11.3x

8.0x

5.7x

0.0x 5.0x 10.0x 15.0x

Drilling

Field Services




Camp Accomodation

Software Solutions

16%

12%

13%

9%

33%

19%

43%

0% 10% 20% 30% 40% 50%

Drilling

Field Services




Camp Accomodation

Software Solutions

15%

11%

12%

11%

30%

16%

24%

0% 10% 20% 30% 40%

Drilling

Field Services




Camp Accomodation

Software Solutions

4%

-7%

13%

-1%

6%

9%

0%

-10% -5% 0% 5% 10% 15%

Drilling

Field Services




Camp Accomodation

Software Solutions

17%

27%

23%

-1%

18%

22%

-8%

-10% 0% 10% 20% 30%

Drilling

Field Services




Camp Accomodation

Software Solutions

Source: Capital IQ. Data as of March 31, 2019.Above noted oilfield service peer groups are market capitalization weighted indexes, including the constituents listed on page 15.LTM refers to last twelve months. NTM refers to next twelve months. Figures above are based on median peer group metrics.

LTM REVENUE GROWTH NTM REVENUE GROWTH

LTM EBITDA MARGIN

LTM EV/EBITDA NTM EV/EBITDA

NTM EBITDA MARGIN

18% 3%

17%

10.4x 7.0x

21%

PUBLIC COMPARABLE ANALYSISPERFORMANCE ANALYSIS

Company

Market

Capitalization

Enterprise

Value Revenue

Revenue

Growth EBITDA

EBITDA

Margin

Revenue

Growth

EBITDA

Margin

NTM

EV/EBITDA

LTM

EV/EBITDA

LTM

EV/REV

Oil and Gas Drilling

Precision Drilling Corporation $1,050 $2,715 $1,541 16.6% $356 23.1% 3.6% 25.3% 7.3x 9.0x 2.1x

Ensign Energy Services Inc. $949 $1,656 $1,156 15.6% $255 22.0% 50.8% 23.5% 7.0x 8.2x 1.7x

Trinidad Drilling Ltd. $487 $1,003 $596 30.4% $123 20.6% (100.0%) N/A 6.4x 8.3x 2.0x

AKITA Drilling Ltd. $134 $133 $118 66.2% $18 15.0% 97.7% 17.5% 13.3x NM 1.9x

PHX Energy Services Corp. $113 $129 $317 31.6% $35 11.0% 6.7% 13.7% 4.8x 11.3x 0.5x

Western Energy Services Corp. $97 $315 $236 (0.7%) $30 12.9% (5.8%) 13.8% 7.3x 9.3x 1.3x

Cathedral Energy Services Ltd. $75 $73 $161 9.3% ($2) (1.0%) (8.6%) 4.8% 3.3x 7.0x 0.5x

Median $134 $315 $317 16.6% $35 15.0% 3.6% 15.7% 7.0x 8.6x 1.7x

Mean $415 $861 $589 24.1% $116 14.8% 6.3% 16.4% 7.1x 8.9x 1.4x

Oil and Gas Field Services

Mullen Group Ltd. $1,527 $1,932 $1,261 10.7% $193 15.3% 3.7% 15.5% 9.7x 11.7x 1.7x

Calfrac Well Services Ltd. $848 $1,742 $2,256 47.7% $305 13.5% (12.3%) 11.9% 6.0x 9.7x 1.1x

STEP Energy Services Ltd. $590 $567 $782 41.3% $110 14.1% (6.6%) 10.9% 2.5x 4.8x 1.0x

Macro Enterprises Inc. $71 $57 $191 83.7% $21 11.1% 61.2% 13.1% 3.9x 14.5x 0.6x

Essential Energy Services Ltd. $74 $92 $190 8.0% $21 11.1% (13.9%) 8.9% 3.9x 6.5x 0.5x

Aveda Transportation and Energy Services Inc. $30 $103 $219 114.1% $17 7.8% N/A N/A 4.9x 8.5x 0.6x

Vertex Resource Group Ltd. $42 $104 $150 27.0% $20 13.6% N/A 14.1% 0.0x 6.7x 0.9x

MATRRIX Energy Technologies Inc. $45 $42 $21 119.1% $1 6.8% N/A N/A 0.0x NM 7.4x

ENTREC Corporation $20 $172 $173 16.4% $14 8.1% N/A N/A 10.2x 15.8x 1.2x

ClearStream Energy Services Inc. $8 $231 $378 5.9% $7 1.8% N/A N/A 0.0x 21.2x 0.6x

Dalmac Energy Inc. $2 $14 $19 (7.9%) $2 9.6% N/A N/A 0.0x 4.5x 0.7x

Median $45 $104 $191 27.0% $20 11.1% (6.6%) 12.5% 3.9x 9.1x 0.9x

Mean $296 $460 $513 42.4% $65 10.2% 6.4% 12.4% 3.7x 10.4x 1.5x

Oil and Gas Machinery and Equipment

Enerflex Ltd. $1,360 $1,594 $1,703 9.7% $207 12.2% 28.3% 14.0% 6.4x 7.6x 1.0x

CES Energy Solutions Corp. $1,577 $1,999 $1,271 23.4% $138 10.9% 3.1% 12.8% 10.4x 15.4x 1.9x

Total Energy Services Inc. $636 $947 $852 40.9% $115 13.5% 3.9% 13.1% 7.4x 12.2x 1.6x

McCoy Global Inc. $37 $27 $49 22.6% $1 2.3% 22.3% 8.3% 10.2x NM 0.7x

Median $998 $1,271 $1,061 23.0% $127 11.5% 13.1% 12.9% 8.8x 12.2x 1.3x

Mean $902 $1,142 $969 24.1% $115 9.7% 14.4% 12.0% 8.6x 11.8x 1.3x


Secure Energy Services Inc. $1,204 $1,504 $2,937 26.2% $173 5.9% (1.2%) 7.0% 8.0x 11.1x 0.6x

Trican Well Service Ltd. $1,005 $1,099 $901 (3.2%) $93 10.4% (18.5%) 5.4% 4.9x 7.0x 1.2x

High Arctic Energy Services Inc $200 $177 $203 (3.3%) $49 24.3% (1.4%) 17.4% 3.6x 3.1x 0.8x

Strad Energy Services Ltd. $89 $98 $120 2.0% $26 22.0% 15.2% 26.2% 3.3x 4.0x 0.8x

CWC Energy Services Corp. $102 $152 $145 29.0% $18 12.2% (19.2%) 9.4% 5.8x 9.8x 1.4x

Hyduke Energy Services Inc. $15 $19 $30 (17.5%) ($9) (29.6%) N/A N/A 0.0x NM 0.5x

Median $151 $164 $174 (0.6%) $38 11.3% (1.4%) 9.4% 4.2x 7.0x 0.8x

Mean $436 $508 $723 5.5% $58 7.5% (5.0%) 13.1% 4.3x 7.0x 0.9x

Oil and Gas Storage and Transportation

Enbridge Inc. $68,681 $153,161 $46,378 4.5% $11,694 25.2% 5.2% 26.7% 12.3x 14.5x 3.5x

TransCanada Corporation $47,203 $95,139 $13,679 1.7% $8,766 64.1% 8.6% 62.8% 12.0x 12.9x 7.1x

Pembina Pipeline Corporation $20,236 $29,957 $7,351 36.1% $2,450 33.3% 11.7% 35.2% 11.4x 18.3x 5.5x

Inter Pipeline Ltd. $8,540 $13,949 $2,593 14.7% $1,250 48.2% (2.8%) 47.8% 11.5x 12.2x 6.2x

Keyera Corp. $6,870 $8,392 $4,465 30.8% $876 19.6% 6.7% 17.1% 11.1x 13.5x 2.5x

Gibson Energy Inc. $2,379 $3,555 $6,847 21.0% $397 5.8% 5.9% 5.9% 10.6x 14.1x 0.6x

Kinder Morgan Canada Limited $1,921 $4,391 $384 6.9% $193 50.4% (9.9%) 60.7% 9.1x 12.3x 6.4x

Tidewater Midstream and Infrastructure Ltd. $457 $587 $324 46.5% $86 26.4% 3.3% 29.9% 7.1x 10.8x 2.6x

Median $7,705 $11,170 $5,656 17.8% $1,063 29.9% 5.5% 32.6% 11.3x 13.2x 4.5x

Mean $19,536 $38,641 $10,253 20.3% $3,214 34.1% 3.6% 35.8% 10.6x 13.6x 4.3x

Camp Accomodations

Civeo Corporation $650 $988 $637 22.1% $102 16.0% 1.1% 20.0% 11.1x 12.0x 2.0x

Horizon North Logistics Inc. $304 $378 $394 21.6% $34 8.7% 23.7% 12.6% 8.0x 13.1x 1.2x

Black Diamond Group Limited $128 $243 $166 8.2% $28 16.8% 9.2% 19.5% 7.0x 9.3x 1.6x

Median $304 $378 $394 21.6% $34 16.0% 9.2% 19.5% 8.0x 12.0x 1.6x

Mean $361 $536 $399 17.3% $55 13.8% 11.3% 17.4% 8.7x 11.5x 1.6x

Oil and Gas Software Solutions

Pason Systems Inc. $1,469 $1,315 $306 24.7% $130 42.4% 2.2% 46.9% 11.4x 16.7x 5.4x

Computer Modelling Group Ltd. $745 $692 $73 (1.7%) $30 40.7% (0.4%) 42.6% 20.6x 22.8x 9.3x

ION Geophysical Corporation $484 $620 $246 (8.9%) $58 23.8% (0.0%) 35.6% 5.7x 8.7x 2.4x

Dawson Geophysical Company $189 $150 $210 (1.5%) $7 3.2% 0.1% 1.1% 5.0x 64.7x 0.7x

Pulse Seismic Inc. $158 $131 $10 (76.6%) $5 46.0% 233.7% 70.6% 7.7x 3.6x 3.0x

Critical Control Energy Services Corp. $7 $19 $27 (7.7%) $1 3.7% N/A N/A 0.0x 10.5x 0.6x

Divestco Inc. $5 $14 $9 (45.5%) ($3) (34.6%) N/A N/A 0.0x 3.1x 0.8x

Median $189 $150 $73 (7.7%) $7 23.8% 0.1% 42.6% 5.7x 10.5x 2.4x

Mean $437 $420 $126 (16.7%) $32 17.9% 47.1% 39.4% 7.2x 18.6x 3.2x

(Figures In $CAD Millions, except percentages and ratios)

LTM Operating Figures NTM Consensus Estimates Valuation

We have selected a group of publicly traded oil and gas entities for this high-level analysis.

Source: Capital IQ. Data as of March 31, 2019.LTM refers to last twelve months. NTM refers to next twelve months.

MNPCF – LEADERSHIP TEAM

DUE DILIGENCE LEADERSHIP

TRANSACTION LEADERSHIP

Aleem BandaliManaging Director

[email protected]

Dale AntonsenManaging Director

[email protected]

John CaggianielloManaging Director

[email protected] 416.513.4177

Brett FranklinPresident

[email protected]

Mike ReynoldsManaging Director

[email protected]

Johnny EarlManaging Director

[email protected] 604.637.1514

Dan PorterManaging Director

[email protected]

Stephen ShawManaging Director

[email protected]

Jason BurgessManaging Director

[email protected]

Mark RegehrManaging Director

[email protected]

Craig MaloneyManaging Director

[email protected]

Patrick KhouzamManaging Director

[email protected]

MNPCF – RECENTLY CLOSED DEALS

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oilfield services quarterly update q1 2019€¦ · on april 30, 2019, bill 12 was proclaimed...

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