Mullen buys drilling fleet

ALDERSYDE, Alta, — The Mullen Group has closed its acquisition of Schmidt Drilling, a private business based in Ponoka, Alta.
The enterprise value of approximately $27.5 million was satisfied by the assumption of debt, the issuance of 250,000 trust units and cash, which was accessed from Mullen’s existing bank facilities.

Schmidt owns and operates five truck mounted drilling units and a fleet of support trucks and trailers. Its business is focused on servicing the oil sands core drilling market. It also provides conventional oil and gas drilling and coal bed methane drilling services.

“Based upon past performance and existing drilling commitments, we expect Schmidt Drilling to increase Mullen’s consolidated revenues in 2006 by approximately $20.0 million. Our analysis indicates that Schmidt Drilling should generate operating margins consistent with other drilling contractors operating in western Canada,” said Stephen H. Lockwood, president and Co-CEO. “Schmidt Drilling’s operations are leveraged to the oil sands which has been a strategic focus of Mullen for a number of years. This acquisition evidences our continued commitment to growth through the acquisition of profitable and well run companies leveraged to the energy industry.”