Strad Energy Services Ltd. reported the initiation of a disposition process for the Production Services Division of the Company.

Andy Pernal, President of Strad said, "We believe that the disposition of the Production Services Division will allow management to focus exclusively on our very successful Drilling Services Division. Proceeds from a disposition of the lower margin Production Services Division would be incorporated into the Company's 2012 capital expenditure program. The company continues to see very strong demand for its rental fleet in both Canada and the U.S. We are confident that a reallocation of the proceeds will allow for more efficient and effective use of capital," .

The Production Services Division provides mechanical services, electrical and instrumentation services, and packaging services for the oil and gas industry. The Division is heavily exposed to the natural gas segment of the industry. For the nine months ending September 30, 2011, the Production Services Division generated revenue of $49.3 million, and EBITDA of $3.2 million, excluding any corporate overhead allocation.

Raymond James Ltd. has been engaged to assist in the disposition process.

Tags: Strad Energy Services Ltd.