Key Energy Wins $45.8 Million Contract from Pemex

Key Energy Services' Mexican subsidiary, Key Energy Services de Mexico S. de R.L. de C.V., has been awarded a 22-month contract valued at $45.8 million by PEMEX to provide field production solutions and well workover services. Under the terms of the contract, Key will initially provide three well service rigs outfitted with its proprietary KeyView system and will install two KeyView systems on PEMEX-owned well service rigs. The contract grants PEMEX the option to call for additional rigs and KeyView systems in the future, although these incremental services are not included in the $45.8 million award. The Company anticipates that it will commence operations in Mexico during the second quarter.

The current project will cover PEMEX's North Region assets and will initially focus on oil wells in the Poza Rica, Altamira and Cerro Azul assets. Depending on the success of the initial project, potential expansion opportunities into the Veracruz and Reynosa fields in the north plus the entire PEMEX Southern Region out of Villa Hermosa, Tabasco, may be possible.

Dick Alario, Key's Chairman and CEO, stated, "We are very excited to have the opportunity to work with PEMEX and especially enthused that the contract was awarded to us via a direct assignment signifying that Key Energy Services is the only company capable of providing these well enhancement solutions using our KeyView technology. Our objective is for this project to enhance Key's position for future opportunities with PEMEX."

Mr. Alario continued, "We are in discussions with other international operators about our proprietary technology products and believe that our technology, combined with our workover expertise, is of great value to international operators like PEMEX."

Key Energy Services, Inc. is the world's largest rig-based well service company. The Company provides oilfield services including well servicing, pressure pumping, fishing, electric wireline and rental tools and other oilfield services. The Company has operations in all major onshore oil and gas producing regions of the continental United States and internationally in Argentina.