Mammoth Energy Services, Inc. Announces Multi-Year Take-Or-Pay Sand Contract
June 08 2017 - 7:00AM
Mammoth Energy Services, Inc. ("Mammoth" or the "Company")
(NASDAQ:TUSK) announced that it has entered into a multi-year
take-or-pay sand contract with a leading third-party service
provider.
Contract Terms:
Under the terms of the agreement Mammoth will supply 720,000
tons of sand per year across several grades (20/40, 30/50, and
40/70) over a three year period starting on October 1, 2017. We
expect the contract to generate approximately $90-$100 million in
total revenues over the contract period, assuming delivery of all
contracted volumes.
Arty Straehla, Chief Executive Officer, commented, “Executing
this take-or-pay contract for 720,000 tons per year of sand at
attractive pricing will provide for a predictable cash flow stream
over the next three years. As we have previously announced, we
intend to utilize approximately half of our 4 million tons per year
(Mtpa) of annual sand production in direct support of our pressure
pumping operations with the remainder sold through potential
contracted sales or into the spot market. This contract secures
placement, at attractive margins, for roughly half of the 1.5 Mtpa
capacity of our Chieftain Sand mine, which we acquired on May 26,
2017. Our expansion into the mid-continent is on track with our
fourth pressure pumping crew currently rigging up to pump its
second job in the area, in line with our previously announced
timeline.”
About Mammoth Energy Services,
Inc.
Mammoth is an integrated, growth-oriented oilfield service
company serving companies engaged in the exploration and
development of North American onshore unconventional oil and
natural gas reserves. Mammoth’s suite of services includes pressure
pumping services, well services, natural sand proppant services,
contract land and directional drilling services and other energy
services. Other energy services currently consists primarily of
remote accommodation services. For additional information about
Mammoth, please visit our website at www.mammothenergy.com, where
we routinely post announcements, updates, events, investor
information and presentations and recent news releases. Information
on our website is not part of this news release.
Forward-Looking Statements and
Cautionary Statements
This news release contains certain statements
and information that may constitute “forward-looking statements”
within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. All statements, other than statements of
historical facts that address activities, events or developments
that we expect, believe or anticipate will or may occur in the
future are forward-looking statements. The words “anticipate,”
“believe,” “ensure,” “expect,” “if,” “intend,” “plan,” “estimate,”
“project,” “forecasts,” “predict,” “outlook,” “aim,” “will,”
“could,” “should,” “potential,” “would,” “may,” “probable,”
“likely” and similar expressions, and the negative thereof, are
intended to identify forward-looking statements. Without limiting
the generality of the foregoing, forward-looking statements
contained in this press release specifically include statements,
estimates and projections regarding our business outlook and plans,
future financial position, liquidity and capital resources,
operations, performance, acquisitions, returns, capital expenditure
budgets, costs and other guidance regarding future developments.
Forward-looking statements are not assurances of future
performance. These forward-looking statements are based on
management’s current expectations and beliefs, forecasts for our
existing operations, experience and perception of historical
trends, current conditions, anticipated future developments and
their effect on us, and other factors believed to be appropriate.
Although management believes that the expectations and assumptions
reflected in these forward-looking statements are reasonable as and
when made, no assurance can be given that these assumptions are
accurate or that any of these expectations will be achieved (in
full or at all). Moreover, our forward-looking statements are
subject to significant risks and uncertainties, including those
described in our Annual Report filed on Form 10-K filed with the
SEC on February 24, 2017, our Quarterly Report on Form 10-Q filed
with the SEC on May 15, 2017 and our subsequent filings we make
with the SEC, many of which are beyond our control, which may cause
actual results to differ materially from our historical experience
and our present expectations or projections which are implied or
expressed by the forward-looking statements. Important factors that
could cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, risks
relating to economic conditions; volatility of crude oil and
natural gas commodity prices; delays in or failure of delivery of
current or future orders of specialized equipment; the loss of or
interruption in operations of one or more key suppliers or
customers; oil and gas market conditions; the effects of government
regulation, permitting and other legal requirements, including new
legislation or regulation of hydraulic fracturing; operating risks;
the adequacy of our capital resources and liquidity; weather;
litigation; competition in the oil and natural gas industry; and
costs and availability of resources.
Readers are cautioned not to place undue
reliance on any forward-looking statement which speaks only as of
the date on which such statement is made. We undertake no
obligation to correct, revise or update any forward-looking
statement after the date such statement is made, whether as a
result of new information, future events or otherwise, except as
required by applicable law.
Contact:
Mammoth Energy Services, Inc., Attention: Don Crist, 14201 Caliber Drive, Suite 300, Oklahoma City, Oklahoma 73134, tel: 405-608-6048
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