Wellco Energy Services Trust and 1374676 Alberta Ltd., a private Alberta company, have entered into an agreement for the purchase and sale of the assets of Wellco's Production Testing Division (excluding frac blow back tanks) for total cash consideration of $6.5 million. Lonkar Well Testing Ltd., will be operator of the production testing assets commencing at close, with no disruption in service to our customers. The transaction is expected to close today or January 29, 2008, with net proceeds being applied to the reduction of long-term debt. Results for this group of assets have been reported under the Production Services segment.
This disposition concludes Wellco's ongoing assessment and review of its product lines with the objective of improving unitholder value and enhancing opportunities in the Trust's core businesses. The Trust's business is now focused on remote accommodations including waste water treatment rentals and water and waste water treatment design and assembly.
This transaction will in no way delay or otherwise affect the previously announced merger involving Wellco and Peak Energy Services Trust.
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