News | August 29, 2014

Canadian Energy Services & Technology Corp. Announces Acquisition Of Southwest Treating Products, LLC

Calgary, Alberta - (Marketwired) - Canadian Energy Services & Technology Corp. ("CES" or the "Company") (TSX:CEU)(OTCQX:CESDF) is pleased to announce that it has entered into an agreement to acquire all of the production and specialty chemical business assets of Southwest Treating Products, LLC. ("Southwest"). The acquisition of Southwest will accelerate the expansion of Company's US production and specialty chemicals operations into the west Texas Permian Basin and the Eagle Ford shale in south Texas through its wholly owned subsidiary Jacam Chemicals 2013, LLC ("JACAM"). The effective date of the transaction is September 1, 2014, with closing expected to occur on or about September 5, 2014. Consistent with previous acquisitions completed by CES, consideration will be a combination of cash and CES common shares escrowed over a three year period. In addition key employees have agreed to employment contracts along with non-compete and non-solicit commitments. Established in 2006, and headquartered in Sonora Texas, Southwest is a west Texas based private production and specialty chemical company that provides production and specialty chemical solutions for a number of leading oil and natural gas companies.

"We are acquiring an established west Texas based production and specialty chemicals company, with experienced management, great customers, and excellent production and specialty chemicals sales, technical and field personnel," said Tom Simons, President and CEO of CES. "Paul Stephens, the founder of Southwest, is a professional chemist and has built the Southwest brand in Texas by employing our same philosophy of using science to solve problems. We see many opportunities and synergies as we combine Southwest with our JACAM operations."

"We are excited to be joining CES, a leading oilfield consumable chemical company in North America," said Paul Stephens. "The combination of our team, our customer relationships in Texas and our expertise, together with JACAM's unique product offerings and manufacturing capabilities will be a powerful partnership for growth."

Strategic Rationale of the Acquisition
Southwest will be integrated into and operate as part of the Company's JACAM division under the brand JACAM Southwest.

Its addition is expected to expand CES's position as a growing provider of production and specialty chemicals in Texas.

CES will add Southwest's blending and distribution facility located in Sonora, Texas, as well as three other Texas stock points. CES will also add Southwest's key field, technical and sales focused employees, expanding JACAM's capabilities to effectively reach and service customers into Texas.

Management of CES expects the Southwest Acquisition to be accretive to CESTC's cash flow from operations; EBITDAC; and net income.

About Canadian Energy Services & Technology Corp.
CES is a leading provider of technically advanced consumable chemical solutions throughout the life-cycle of the oilfield. This includes solutions at the drill-bit, at the point of completion and stimulation, at the wellhead and pump-jack, and finally through to the pipeline and midstream market. CES' business model requires limited re-investment capital to grow. As a result, CES has been able to capitalize on the growing market demand for drilling fluids and production and specialty chemicals in North America while generating free cash flow. CES returns much of this free cash flow back to shareholders through its monthly dividend. Additional information about CES is available at www.sedar.com or on the Company's website at www.CanadianEnergyServices.com.

Non-GAAP Measure
CES uses certain performance measures that are not recognizable under International Financial Reporting Standards ("IFRS"). These performance measures include EBITDA and EBITDAC. Management believes that this measure provides supplemental financial information that is useful in the evaluation of CES' operations. Readers should be cautioned, however, that these measures should not be construed as alternatives to measures determined in accordance with IFRS as an indicator of CES' performance. CES' method of calculating these measures may differ from that of other organizations and, accordingly, these may not be comparable.

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