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PHX Energy Boosts Capital Spending Program to $33.5MM

July 06, 2018, 07:05 AM
Filed Under: Industry News

PHX Energy Services Corp. announced its board of directors approved a $15 million increase to the corporation’s 2018 capital expenditure program. With this increase PHX Energy now anticipates spending $33.5 million in capital expenditures during 2018. The increase will primarily be dedicated to further expanding the Atlas high performance drilling motor fleet for activity in 2019.

On May 30, PHX Energy announced an $8 million increase to its initial 2018 program to support its performance drilling motor fleet and expand its new Atlas Power Rental division. These motors of various configurations are on order, including additional proprietary high performance 7.25" Atlas motors, and are anticipated to be received during upcoming quarters.

PHX Energy’s activity levels in the second quarter increased and are continuing to improve, with the majority of the growth being focused in the Permian basin in the U.S. This is the result of PHX Energy’s strategic initiatives and targeted objectives to position itself as a prominent player in key operating areas, like the Permian, and deploy PHX Energy developed high performance technology.

The Atlas Power rental division is experiencing high demand for the technology. The Atlas motors deliver a higher level of performance and operators are benefiting from the ability to drill at faster speeds with superior reliability. PHX Energy foresees the opportunity to deploy an even greater number of the Atlas motors, and plans to dedicate the $15 million increase toward fleet expansion.

The increased program is anticipated to allow for future expansion while maintaining the corporation’s healthy balance sheet. PHX Energy will continue to take a disciplined approach toward growth and believes the increase to the 2018 program will aid in further improvements in profitability, officials said. The 2018 program is expected to be financed from a combination of cash flow from operations and the corporation’s unused credit facilities.

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