Trican sells Russian fracking business, refocuses on USA, Canada

Trican also terminated operations Australia, suspended business in Colombia, Saudi Arabia

International service company Trican Well Service Ltd. has closed of the sale of its Russian pressure pumping business, saying it wants to focus on the North American market.

Photo: Trican Well Service.

The transaction involves the sale of all shares of Trican Well Service LLC, an indirect wholly-owned subsidiary of Calgary-based Trican that holds the Russian pressure pumping business, to RN Assets LLC – a subsidiary of Rosneft Oil Company – for a purchase price of US $150 million, or approximately CDN $196.7 million.

Trican said in a press release that it intends to apply the net proceeds from the transaction to reduce its outstanding debt.

“We are very pleased to have closed this transaction. We are very proud of the business Trican built in Russia and of the excellent employees who have worked very hard to make this business successful,” said CEO Dale Dusterhoft.

“We believe, however, that it is the right time for our company to exit the Russian pressure pumping business and focus on improving the profitability of our North American business. This transaction allows us to strengthen our balance sheet and to move forward in our plans to weather the current economic downturn.”

Trican CEO Dale Dusterhoft.

Trican announced on May 12 that it had been in negotiations for the sale of its Russia and Kazakhstan pressure pumping businesses since receiving an unsolicited offer earlier in the year.

Trican says that Rosneft has obtained approval of the Russia Federal Antimonopoly Service for the transaction. Closing of the transaction is scheduled for August 20 and is subject to certain conditions precedent and the preparation and delivery of customary closing documentation.

Pursuant to the terms agreed, Trican will provide certain transitional services following closing of the transaction on terms that are customary for transactions of this nature.

Trican says it will continue to offer well completion solutions products and services in Russia following the closing of the transaction.

Trican and Rosneft are also continuing to negotiate for the sale of Trican’s Kazakhstan pressure pumping business. If the parties reach agreement on the terms of the sale of the Kazakhstan business, Trican expects that such sale would close in the fourth quarter of 2015.

The sale would be subject to approval by the Kazakhstan Antimonopoly Body, and final corporate approvals by Trican and Rosneft.

Trican recently terminated its operations in Australia and suspended operations in Colombia and Saudi Arabia.

Trican will continue to operate in Canada, the United States, and Norway.