Welcome to Best Energy Services
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We are an energy production equipment and services company engaged in well servicing, workover and related complementary activities. We own a total of 25 well service and workover rigs, and we conduct our well services primarily in the Mid-Continent regions of the United States.
Until such operations were discontinued in 2009, we also provided drilling services and related complementary activities in the Rocky Mountain region of the United States. We currently own a nine drilling rigs that we are in the process of selling. Also, until such operations were discontinued in 2009, we provided housing accommodations to the oil and gas drilling industry principally in Texas and geological mud-logging services to our then existing business segments. We are also in the process of divesting the assets of this business.
Well Servicing Division. Our acquisition of Best Well Service, Inc., or BWS, gave us a strong footprint in the hydrocarbon-rich Hugoton basin. BWS operates up to 25 well service rigs in the Mid-Continent region of the United States. BWS has distinguished itself over the years in its service to both major oil companies and large independents, as well as an employee retention history that we believe is among the best in the industry. BWS also has complete in-house safety certifications and ranks extremely high within its regional peer group.
Business Strategy Going Forward
Our overreaching goal for 2010 is to increase the level and predictability of our revenues in the well services business.
Basin-Centered Opportunities. In early 2009, workover activity industry-wide witnessed a severe contraction. At BWS, activity decreased in a matter of weeks from 25 active rigs to as few as three. In the wake of that decline, BWS was able to restore its activity level to between 40-60% of available rigs by capturing a larger market share of available work in the Hugoton Basin. Best now estimates that BWS's share of the local market is roughly 80% versus 30-35% in 2008.
HBFP. During 2009, a much repeated reason our customers gave for not having more active workover programs was that capital was not being made available from their corporate decision makers. In recognition of the customer's needs for capital, Best is in the process of establishing Hugoton Basin Financing Partners, or "HBFP," a joint undertaking with an oil and gas focused private equity group based in New York.
Under the arrangement as currently contemplated, BWS would source candidates for HBFP that require capital to finance their workover projects. HBFP would take capital advanced to it by the private equity Fund and, on certain undisclosed terms, provide financing to the customer in return for a preferential return from production from the wells, plus a premium and a residual back-in after payout. Customers of HBFP would be required to use BWS to provide their workover services. In addition, BWS would be retained to bundle certain additional services for the HBFP customer, with BWS being compensated for such services by the vendor. The HBFP non-binding indicative term sheet calls for up to $5 million of capital being made available to potential BWS customers. The HBFP transaction is subject to negotiation of a definitive agreement between the Fund and Best. Best believes there may be a substantial market for this style of financing, not only in the Hugoton Basin, but in other basins as well.
Best Energy Services, Inc.
10375 Richmond Ave.
Houston, TX 77042
Investor and Media Relations
Dodi B. Handy, President & CEO
Elite Financial Communications Group, LLC/Elite Media Group
605 Crescent Executive Ct.
Lake Mary, FL 32746