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Civeo acquires accommodation facility in Louisiana

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LNG Industry,

Civeo Corporation has announced that it has completed the acquisition of a 400 room accommodation facility on 40 acres of land located near Lake Charles, Louisiana from a private seller. The facility is strategically positioned to support the planned construction of several petrochemical and LNG projects anticipated along the US Gulf Coast. The asset is currently under contract with a large petrochemical company, providing contracted revenue visibility through mid-2019.

Under the terms of the purchase agreement, total consideration for the transaction is US$28 million, composed of US$23.5 million of cash and US$4.5 million of Civeo common equity issued to the seller. The agreement also includes an earnout up to US$4 million of Civeo common equity (based on current market prices) dependent on further contracted revenues through December 2020. For the ten months remaining in 2018, the facility is expected to generate approximately US$7 million in revenue and US$6 million in gross profit.

Bradley J. Dodson, Civeo's President and Chief Executive Officer, commented "This acquisition strengthens our presence in the US by diversifying our end market exposure to the downstream sector in the Gulf Coast. Similar to our previously announced Noralta acquisition, this acquisition provides additional topline visibility through an established customer contract."

The acquisition includes the 400 room facility on 40 acres providing the necessary room for expansion, if needed. The facility is currently over 90% occupied.

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