Dale Dusterhoft - Chief Executive Officer Donald Luft - President and Chief Operating Officer Michael Baldwin - Vice President Finance and Chief Financial Officer Gary Summach - Director of Reporting and Investor Relations

Scott Treadwell - TD Securities Inc. Dana Benner - Altacorp Capital Jim Wicklund - Credit Suisse Brian Purdy - PI Financial Corp.

Jon Morrison - CIBC John Daniel - Simmons & Company Yadullah Hussain - National Post Greg Colman - National Bank Financial Dan Healey - Calgary Herald Jeff Fetterly - Peters & Company

Thank you very much. Good morning, ladies and gentlemen.

I'd like to thank you for attending the Trican Well Service conference call for the first quarter of 2015. Here's a brief outline of how we intend to conduct the call.

First of all, Mike Baldwin, our Senior Vice President of Finance and CFO, will give an overview of the quarterly results. I will then address issues around current operating conditions and the near term outlook for each of our regions.

We'll then open the call up for questions. Joining us today and available to address questions are Don Luft, our President and Chief Operating Officer and Gary Summach, our Senior Director of Investor Relations.

I would now like to turn the call over to Mr. Baldwin to discuss the overview of the financial results.

Thank you, Dale. Before we begin, I’d like to point out that this conference call may contain forward-looking statements and other information based on current expectations or results for the company.

Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information. A number of business risks and uncertainties could cause the actual results to differ materially from these forward-looking statements and financial outlook.

These risks and uncertainties include, but are not limited to, fluctuating prices for crude oil and natural gas, changes in drilling activity, general global economic, political and business conditions, weather conditions, regulatory changes, the successful exploitation and integration of technology, customer acceptance of technology, success in obtaining issued patents, the potential development of competing technologies by market competitors and availability of products, qualified personnel, manufacturing capacity and raw materials. Among the risks are the ability of the oil and gas companies to finance their operations and other unforeseen factors.

Please refer to our 2014 annual information form dated March 25, 2015 for a more complete description of business risks and uncertainties facing Trican. Our first quarter results were released yesterday and are available on our website at www.trican.ca.

As noted in our press release, consolidated revenue for the first quarter of 2015 was $476 million, a decrease of 26% compared to the first quarter of 2014. The adjusted operating loss was $5.1 million and the loss per share was $0.24 compared to an adjusted operating income of $42.4 million and a loss per share of $0.06 for the same period in 2014.

Funds used in operations were $28 million compared to funds provided by operations of $38 million in the first quarter of 2014. I will provide commentary on the financial results of our geographic segments on a sequential quarterly basis as we believe this comparison provides the most meaningful insight and analysis into the first quarter financial results.

Canadian revenue in the first quarter of 2015 decreased by 35% compared to the fourth quarter of 2014. The job count decreased by 33% due largely to a substantial drop in activity caused by lower commodity prices and an early spring break up.

Revenue per job decreased by 2% as a 10% sequential decline in pricing was offset partially by a favorable change in customer and job type mix. Adjusted Canadian operating income margin for the first quarter of 2015 of 6% decline by 1580 basis points on a sequential basis.

Decreased activity levels led to lower operating leverage on our fixed cost structure as we were unable to reduce fixed costs to match the rate of the revenue decline. Lower sequential pricing also negatively impacted margins.

For our US operations, revenue decreased sequentially by 41% due largely to lower activity and demand across all US operating districts, which contributed to a 35% decline in the sequential job count. Revenue per job in the US decreased by 9% due to a 15% price reduction which was offset partially by a strong US dollar or stronger US dollar.

Adjusted US operating income margins of negative 3.4% declined by 1360 basis points on a sequential basis due largely to pricing declines and reduced operating leverage on our fixed structure. Although measures were taken to reduce fixed costs, the reductions did not match the rate of the revenue decline.

Given the sharp decrease in the North American activity levels, cost control was a key focus for Trican in the first quarter of 2015. Cost of sales, which includes consumable products and product transportation costs, is our largest cost category and represents approximately 50% of our total costs.

Trican entered into negotiations with all vendors in late 2014 to reduce cost of sales in anticipation of the reduced demand and pricing expected in 2015. Total average product cost reductions to date have been approximately 9% in Canada and 10% in the US compared to product costs at the end of 2014.

The impact of the negotiated product cost reductions on first quarter results was muted due to higher cost inventory on hand at the end of 2014 and low first quarter activity that extended the length of time required to consume the higher cost inventory. In addition, many products, in particular sand, are sourced in the US and as a result, the weakening of the Canadian dollar partially offset the impact of realized cost savings in Canada.

Actual savings on North American product cost reductions in the first quarter were approximately $10.8 million. Effective February 1, 2015, a 10% salary reduction was implemented across North America, which led to $4.2 million reduction in North American salary costs for the first quarter of 2015.

In addition, a second salary reduction of 10% [indiscernible] and reduced benefits for all Canadian and corporate employees has been implemented effective April 15, 2015, and will remain in place until breakup is over or until activity levels increase. Our North American employee base was reduced by approximately 2,000 people or 44% during the first quarter, due to the low demand and an expectation of continued low demand throughout 2015.

The majority of these reductions occurred in our US operations. A significant amount of the employee reductions occurred in March and therefore minimal cost savings relating to this initiative were realized during the quarter.

Our first quarter results also include total consolidated severance costs of approximately $9.5 million relating to these reductions. The lower employee base combined with salary and benefits reductions are expected to result in annualized consolidated fixed cost savings of approximately $115 million.

Cost cutting measures were also taken to reduce corporate cost during the first quarter of 2015. Excluding severance, professional charges of $1.7 million, and change in share-unit costs, corporate expenses decreased sequentially by $2.6 million or 15% compared to Q4 2014.

The decrease is largely due to cost control measures initiated in late 2014, which included salary reductions, lay-offs and reductions in discretionary costs. We expect additional decreases in sequential corporate cost during 2015 as we continue to focus on cost reduction efforts.

Our International operations include financial results for our operations in Russia, Kazakhstan, Australia, Saudi Arabia, and Norway. Operations in Colombia were suspended in early 2015, and therefore, only closure costs relating to this region are included in the first quarter results.

International revenue decreased by 28% sequentially. The devaluation of the Russian ruble had the largest impact on international revenue as ruble declined by 21% compared to the Canadian dollar on an average sequential basis.

Lower utilization and demand in Kazakhstan, Saudi Arabia and Australia also contributed to the decrease in international revenue. International operating margins in the first quarter declined by 650 basis points on a sequential basis.

Operating losses in Columbia and Saudi Arabia contributed to the decline in operating margins. One-time closure cost in Columbia were approximately $400,000.

Lower activity in Kazakhstan, Australia and Norway also led to reduced operating leverage on our fixed cost structure as Kazakhstan and Australia were affected by commodity prices and Norway experienced some seasonal slowdowns. Managing cash flow and strengthening the balance sheet was a primary focus for Trican during the first quarter of 2015 and we will continue to be a focus during the current downturn.

In addition to significant cost cutting measures, several other measures were taken during the first quarter that are expected to preserve liquidity and provide financial flexibility in 2015. Working capital fell by $130 million and was a significant source of cash flow for the company during the first quarter of 2015.

We expect additional cash flows from working capital reductions in the second quarter of 2015. With our working capital release during the quarter, the company paid down $98 million in debt and exited the quarter with $353 million of cash and available debt.

Effective immediately, Trican’s Board of Directors has fully suspended the dividend to shareholders. The Board of Directors will continue to re-evaluate the dividend policy on a quarterly basis.

Capital expenditures for the first quarter of 2015 totaled $7.1 million, compared with $16.7 million for the same period in 2014. With the decline in commodity prices and North American demand, capital expenditures will be kept to a minimum until operating conditions improve.

A substantial amount of equipment has been parked in both Canada and the US, which will reduce the amount of maintenance capital needed throughout the current downturn. In addition, capital expansion initiatives will not be considered during the current economic environment in order to preserve current liquidity levels.

Based on existing capital budget commitments, we expect capital spending to be between $40 million and $50 million during 2015. However, spending on capital projects is currently limited to completion of existing AFEs and spending is critical to maintaining or increasing the company’s near term cash flow.

As such, expected 2015 capital expenditures maybe marginally lower than $40 million for the year, if the current operating environment persists through the year. Trican regularly reviews its capital equipment requirements and will continue to follow its policy of adjusting the capital budget on a quarterly basis to reflect changing operating conditions and capital equipment needs.

Management has prepared forecasts for the remainder of 2015 and 2016 and forecasts a breach of its interest coverage ratio debt covenant during the second half of 2015 and first quarter of 2016 due to current North American pressure pumping activity and pricing being at cyclical lows. If this covenant is not met, the revolving credit facility and senior notes may become due on demand.

Trican is currently in the process of negotiating covenant relief with the revolving credit facilities syndicate and the senior note holders. Negotiations are proceeding on an expedited basis, however, the negotiations with the company’s lenders are more extensive from a structural perspective as a result of the process to sell our Russian and Kazakhstan pressure pumping business.

Obtaining covenant relief is not contingent on the closing of the sale of the Russian and Kazakhstan operations, but must be considered in our negotiations with our lenders. Any covenant breach is not expected to be imminent and management is optimistic that suitable covenant relief will be reached with these lenders prior to a covenant breach actually occurring.

I will now turn the call over to Dale who will be providing comments on operating conditions and strategic outlook.

Thanks, Mike. As a result of an unsolicited offer, the company is currently in negotiations to sell its Russian and Kazakhstan pressure pumping business.

Although talks are progressing, significant terms and conditions are still under negotiation. Accordingly, there can be no guarantee that the company will conclude this transaction.

Further, the timing of completion of any such transaction remains uncertain. Based upon the terms and conditions currently being discussed, management believes the offered price represents fair value for this business and that the sale would be in the best interest of shareholders if acceptable terms and conditions can be negotiated.

Although short term results in Russia have been good, our long term view of this market has deteriorated as conditions in Russia and relationships between Russia and the West have worsened. We see divesting our Russian business at a fair price as a positive move for our company and in the best interest of shareholders.

Trican chose to release this information at this time as [indiscernible] that information regarding this transaction could be made to the public during negotiation. Trican will not be providing any further public statement regarding this transaction at this time.

Significant declines in both oil and natural gas prices impacted demand for our services as Canadian pressure pumping activity was down substantially both year-over-year and sequentially. Although demand was steady in January and for most of February, activity levels fell sharply at the end of February and remained weak until the end of the first quarter.

The number of wells drilled in Canada was down 46% relative to the first quarter of 2014 and 39% relative to the fourth quarter of last year. In addition, many Canadian producers opted to defer well completions during the first quarter of this year, which negatively impacted demand for our fracturing services.

As a result of the reduced demand during the first quarter, average Canadian pricing declined by 10% compared to the fourth quarter of last year. We expect Canadian pricing for the remainder for 2015 to be down compared to the first quarter, but to stabilize during the third quarter.

In addition, Canadian industry activity is expected to be down substantially during the second quarter of this year compared to the same period in 2014. April and May activity will be down considerably with expected increases from June onward.

In response to low demand in March and the expectation for reduced demand for the second half of 2015, we decreased the amount of active equipment in Canada by approximately 35% in mid-March. We expect to keep 35% of Canadian equipment part for the remainder of 2015 as demand is expected to remain well below 2014 levels.

If demand level change, we’re prepared to park additional equipment and downsize further or redeploy equipment quickly if demand improves. We’re focused on sizing our operations to maintain high utilization which will maximize our EBITDA and cash flow in a low activity low price environment.

Despite the declines in demand and pricing, with downsizing and cost control initiatives in place and forecast activity levels of some of our more active clients, we expect Canadian operating income to improve over the second half of 2015 compared to the first quarter of this year. Our Canadian customer base has remained loyal to us and we have increased market share with a few key customers who we expect to be active in the second half of the year.

We will continue to focus on reducing costs in the upcoming quarters and, in particular, will focus on further reductions to our cost of sales as this will have the largest impact on our second half profitability. For our US operations, a substantial decline in commodity prices impacted demand for our services during the first quarter of this year.

Many of our US customers reduced or cancelled their drilling and completions programs and we were unable to replace this lost work during the quarter. Utilization of our equipment was steady during January but decreased sharply in early February and led to poor financial results for our US operations in February and March.

The number of active drilling rigs in the US was 43% lower at the end of the first quarter compared to the end of 2014. In addition, well completion activity was down substantially in all major US oil and gas regions, which negatively impacted fracturing demand.

Low demand resulted in a 15% decline in average first quarter pricing compared to the fourth quarter of 2014. Second quarter results for our US operations are also expected to be weak.

As stated above, many of our key customers in the US have substantially reduced or cancelled work programs in our areas of operations. As a result, we are in the process of transitioning many of our frac crews to new customers.

Utilization levels in April and start of May will be very weak and lead to second quarter operating loss. Activity bottomed in April and we have been winning new contracts and expect monthly improvement in activity throughout the second quarter.

We have had good success in implementing our patented MVP fracturing system in the US during the second quarter and have a number of wells planned in May and June with this system with new customers which could result in market share growth for our US division. We and our customers will monitor the well results closely over the next few months and look at expanded work programs should well results come in as anticipated.

We have also recently completed five wells with our diverted frac system which gives us a competitive advantage in the re-fracturing market. Average pricing in the second quarter of 2015 is expected to be lower sequentially, and substantially lower than the same period of last year.

However, we do anticipate a bottoming of pricing in the US shortly as the whole industry is at unsustainably low pricing levels. We expect to see the impact of US cost control measures improve financial results in the second quarter, but not enough to generate positive operating income.

In response to reduced demand, we downsized our US pressure pumping operations substantially during the first quarter. We closed our operating base in Longview, Texas in late January, which resulted in costs of approximately $4 million recognized during the first quarter of 2015.

We also parked one fracturing crew in each of our Marcellus, Oklahoma, and Eagle Ford regions, two fracturing crews in the Permian region, and both fracturing crews in the Bakken. Our operating base in the Bakken has been temporarily shut down until operating conditions in the region improve.

At the end of the first quarter, eight US fracturing fleets were active compared to 16 at the end of 2014. Utilization for the remaining active equipment fleet in the US was low at the start of the second quarter, but is expected to improve over the second half of this year based on current customer commitments and an expectation of improvements in industry demand from current levels.

Improved utilization, combined with cost cutting and cost efficiency measures, are expected to result in positive operating income in the second half of 2015 for our US operations. However, these expectations could change if additional commodity price weakness or changes to our cost structure occur.

And in Canada, we will continue to right size our fleet to maximize utilization. We will also look at further consolidation of operations, as required, to maintain a low cost structure and return to generating positive cash flow during this downturn.

Although current North American operating conditions are extremely challenging, we are seeing some opportunities and positive developments for our industry. Many of our Canadian and US customers are currently tendering work programs, providing opportunities to gain market share and obtain contracts from new customers.

We have also been awarded a number of wells in Canada and the US utilizing our MVP and our fracturing systems and are exploring licensing the technology directly to certain customers who have their own fracturing fleet. In addition, a backlog of uncompleted wells continues to develop as many producers across North America have opted to drill but not complete their wells.

Once moderate improvements to commodity prices occur, we expect completions demand to improve immediately, which bodes well for our fracturing service line. With a continued focus on cost control and cost efficiency measures, we believe that the long-lasting cost reductions and efficiencies will occur for our industry.

These cost reductions are expected to result in increased margins in our business once activity levels increase and help Trican to be competitive in a lower commodity price environment. For international operations, our Russian business comprises the majority of this segment and results of activity levels in Russia were strong during the first quarter of this year.

The devaluation of the ruble helped to mitigate the impact of lower oil prices and the large Russian oil producers remain committed to maintaining or increasing production levels. Despite a 60% year-over-year decline in the Russian ruble relative to the Canadian dollar during the first quarter, Russian revenue decreased by only 30% as higher activity levels helped to offset the impact of the weaker ruble.

The decline in the value of the ruble had a minimal impact on Russian operating income as a percentage of revenue, as most of the first quarter expenses in Russia were also denominated in rubles. Second quarter demand in Russia is expected to be higher on a year-over-year basis; however, second quarter Canadian dollar revenue is expected to be negatively impacted by the devaluation of the ruble.

The decline of the ruble is also expected to result in cost inflation during as the year progresses, which may lead to lower year-over-year operating margins in this region. Due to the low price of oil and a reduction to our customers drilling and completions programs, we temporarily suspended operations in Colombia in early 2015.

We will continue to evaluate opportunities in this region but do not expect to resume operations until economic conditions improve. Activity levels and financial results were weak for our operations in Kazakhstan, Saudi Arabia and Australia with all regions being negatively impacted by low commodity prices and weak customer activity.

We were not awarded any work from our customer in Saudi Arabia during the first quarter of this year, which led to a $1.4 million operating loss for this region. Second quarter activity in this region has improved and results will be substantially improved over the first quarter.

First quarter activity in Kazakhstan was low compared to the previous year due to a drop in commodity prices. Second half activity will be higher in this region as customers delayed finalizing their budget and announced our intent to execute on the 2015 work programs.

Revenue in Australia was down in the first quarter by approximately 22% as this region continues to be negatively impacted by lower commodity prices and the slow development of the LNG export business. We are currently bidding on some meaningful cementing projects in Australia that would increase the utilization of our cementing fleet and will continue to optimize our cost base to activity levels in this region.

Operating and financial results for the Norwegian completion tools division were down on both a year-over-year and sequential basis due to the timing of our customers' work programs. We have won some significant contracts over the remainder of 2015 and expect results in this region to improve as the year progresses.

Our management team has experienced several business cycles and understands what is needed to survive a severe downturn. This downturn has been sharper and deeper than previous ones and it has taken us a few months to align our costs with the drop in pricing and activity.

We believe we have taken the steps needed to manage the business through this downturn, which include: broad cost control measures, downsizing our active equipment fleet in North America and reducing our corporate costs. Our main focus near-term will be to continue to reduce costs, finalize the sale of our Russian and Kazakhstan businesses and obtain amendments to our lending agreements that will provide financial flexibility throughout the current economic environment.

We remain confident in our ability to execute on our strategy needed to manage through the current downturn and expect to emerge as a stronger organization. I thank you for your attention today and your interest in Trican.

I would like to turn the call over to our operator for any questions. Thanks.

Wanted to start on the working capital side, do you have a sense of what the incremental release could be in Q2 on the back of a pretty big one in Q1?

You know, the release in Q2, it’s not going to as big as Q1, because activity did drop off pretty hard at the end of the quarter. It’s flattening out right now throughout Q2, but there will be a release.

I’m not going to disclose exactly what that is, but it’s going to be enough to pay down more debt in the second quarter.

Turning to the equipment side, you’ve parked a bunch of equipment and obviously there is a bunch of ideas that have to go into that. Is the aim to keep your utilization rate at the top end on this reduced equipment base or are you giving yourselves some ability to pick up incremental work that isn’t on the radar today?

I would say that the goal is keep utilization as high as possible on our equipment. But you’re correct, you have to factor in any additional work that you have outstanding on tenders and additional work that you have in your pipeline or even potential accretive pipeline.

So there is a little wiggle room in utilization just on always why you are tendering additional contracts as long as the visibility on those contracts is quite good. If it’s quite speculative work and we don’t think we have a reasonable chance of obtaining that work, then we’re not going to keep equipment running for a lengthy period of time in hopes of something aligning in our lines.

Last one from me, you gave us a rundown on the potential sale, I was just looking through the news release and you list assets in the international group of, I think it’s about $250 million, but the PP&E and goodwill is sort of sub-100. Would it be fair to assume that that gap is dominated by working capital assets, receivables and inventories?

And if so, is it fair to assume that the receivable cycle for you guys in the international is materially longer than it is in North America?

Yeah, that’s right, Scott. It’s almost all working capital and you’re correct, the payment cycle is longer in North America where it’s 60 to 70 days and in Russia 90 to 100 days.

I wonder if we could talk about the additional cost cuts or I guess rationalization that maybe necessary in Q2, Q3, what will be the primary focus of the next set of efforts that you engage in?

Right now, the primary focus is our product cost. We’re continuing to work on that as we stated.

We started with that at the end of 2014 already, but there is basically an inventory of higher cost product that we had to work through. We’ll work through a lot of that going forward.

We have obtained 9% to 10% reductions from our product suppliers to date, but the next step for us is switching suppliers to suppliers that are lower cost and that will realize us some additional savings, plus I’d say we’re going back to all of our suppliers for additional cost cuts as well as I think the reality of this downturn filters down the chain to our supply chain. All of a sudden, we have probably a little bit more ability to get pricing concessions from our existing suppliers prior to switching.

So we believe that that’s our biggest spend last year, it will focus on the most and it’s probably the one that will give us the most impact on our business. We have potential consolidation opportunities that we’ll look at as we go forward and kind of depends on where our work is in various regions.

And we’ll look at that as well as some potential cost savings. And as we’ve stated, we’ll continue to right size our fleet to the activity levels we see, which we don’t anticipate last a few months more, it’s unclear obviously, but we’ll just have to read the market on that part.

Secondly, other than Russia which was unsolicited, could we see other dispositions within the fold of Trican situation whether unsolicited or not?

I would say that at the present time we have no intention of disposing assets or anything, but we’ll look at everything. It depends on what the valuation is and we are a very public company and we will do what’s in the best interest of the shareholders.

If we have an unsolicited offer come in, we certainly have to look at everything.

Thirdly, the frac log, let’s call it that, in the US has been well discussed and I wonder if you could comment on whether you think that as a material trend in Canada proportionately or not as we may be seeing in the US?

It’s not as big of a percentage and quite honestly I don’t have a number of what that number of wells is. It did have an impact on our first quarter as some of our key clients defer some of their fracturing into late second quarter and third quarter.

But a lot of that, and this is normal in Canada, is due to weather as well. So because of the water freezes in the first quarter, a lot of the large fracture jobs get deferred into warmer type months and so it’s pretty normal for customers to drill some wells, get a bit of a backlog and then come to re-complete them in the third quarter.

And we saw that again and I think that we certainly had a few customers very loyal to us take that approach and may be do that a little bit more than they normally would have even in normal times, because there is no impetus to get the production on line quicker and spend money to do that.

And just last one from me, you have mentioned a roughly a 15% price cut over the course of Q1 and is that in US dollars or is that the translated effect back into Canada?

You are talking about the price reduction in the US?

Yes.

Yes, that was in US dollars. That’s in our book in currency down there.

You talk about idling equipment, are you scrapping anything or is this just all being stacked, waiting to be put back to work at some point?

Yeah, it’s being stacked being ready to put back to work. We’re not scrapping anything.

The age of our equipment is such that we don’t have equipment to throw away yet at the stack exchange.

Do you see a lot of equipment getting scrapped out there in this market?

It’s hard to tell. We think there will be some, I think, any equipment just have passed 10 years old probably does make a lift to potentially gets scrapped.

I think we’re seeing some scavenging of equipment out there in certain situations where people are fighting with cash flow issues, there’s probably some scavenging goes on and our people believe that, that’s not something that we do. So we keep our equipment intact and don’t break and take another one off the sands.

I think there is a little bit of that going on and there will, always during a downturn [indiscernible] try to reduce fleet to anything that’s kind of older, getting another to set the operation. So there will be some of that.

But I can’t really comment on how much because we can’t keep track of all that in the industry.

If it stays stacked next to the fence too long it's effectively scrapped anyway. You talk about how it's going to be a difficult market and this is one of the sharpest and most sudden downturns.

And I know you guys have been through these before, unfortunately to one that you just have. And you'll manage through it.

I'm just curious, you don't know how long it will last, but is taking market share which obviously costs you money in this market a dangerous thing to do early if this lasts, this trend lasts a while?

I think it all depends on what price you’re taking that. I think our view is that we don’t take market share at the expense of margins.

So a lot more negative margins. So we’re not going out there grabbing market share for negative margins.

So the market share increases that we’re looking at still have to meet our criteria of generating some positive cash flow. And we’ve been – some of the market share increases we’ve had recently have been through our technology.

And it’s interesting, we try to introduce our MVP system throughout the US for the last little while, but now the customers have more time on their hands and are looking at all options to reduce their cost or increase their productivity. That’s quite a bit of acceptance of that technology recently in the US.

And when we do those type of jobs, those are all a positive cash flow, we’re not making loss of operating income, but we’re not getting anything in negative territory.

That's a very positive distinction. I appreciate that.

And last question, if I could, people, this is always dangerous when we have these down cycles, when you lay off people and before we know it we have to hire them back. Is it going to be just like the last couple of times in hiring people back, is it going to be any different staffing up this recovery than past recoveries do you think?

I would say that at the start of the upturn, whenever that happens, there is a group of people that are available and we can bring them back relatively quickly. But as you start getting to a point where you can staff all your equipment, it will be more challenging, in particular in certain areas where activity levels increase first.

So traditionally, the Permian has been a tough area to get people and the Bakken to some extent and I anticipate that they will be as well. In Canada, we did take the approach of rolling salaries back a little bit more and retaining more of our people, because Canada has been such a tough labor market for a number of years.

And so, instead of tying another 10% out of our staff, we actually rolled salaries back another 10% and gave them some time off in lieu of that to try and retain more people and have the same net effect. And that was really because we know how hard it is to get some trained people in Canada and we’re trying to retain as many as we can for an activity increase at some point in time.

I wanted to ask about, you've obviously been having a lot of discussions with your lenders and other debt holders about getting the covenant waivers. I'm just wondering if you could give us some characterization of the tone of those discussions and whether you started looking at alternative financing if you think that might be necessary.

I think the tone is generally positive as far as those conversations can go. My sense of both on the revolving credit facility lenders and the note holders is they’ve been constructive and helpful in walking through the whole process.

At this stage, we haven’t been looking at restructuring anything. I think everything is on the table, but at this point in time we’ve been more focused on just getting the covenant relief and then going to the next stage after that.

I wanted to ask a bit about US activity, you mentioned in your commentary about expecting activity to improve through Q2. I'm just wondering if you can give us some idea of what the impetus of that is and what the magnitude maybe is of compared to what we saw in Q1?

So the impetus is that we bottomed in April and so we had a very low activity level in April and that was just, as I mentioned, as customers rolled the programs over, us having to replace a lot of the work with additional customers. And so it was really building upon that.

But today, we’re still not at a level that we’re happy with. So we’re seeing month over month increases.

I think there is some optimism around the contract awards, in particular, some of the technology awards that we’ve been getting, but we want to see more. And if you looked at the quarter compared to the first quarter, I’d say that March was quite lower in the first quarter as well.

So we’ll see some improvement probably on that as we get into 3Q, but it’s hard to quantify at this point in time, which really depends on additional contract awards which we believe we need to win.

You mentioned as well there was some impact from inventory that was bought at higher prices on the margins and I'm just wondering how long you think it might take to work your way through that inventory?

We're pretty much there now, Brian. Normally we would hold 30 to 45 days of inventory on-hand, so you would expect to work through that, but because the activity was so low in Q1 it took us a good chunk of the quarter to work through it.

But we worked through it now and we should start to see more cost savings on the product side starting in Q2.

And when you talk about your product cost, I apologize; I think you said around 10%, is that the kind of magnitude you expect to see in Q2?

Yeah, based on the pricing we got today, it’s about 10%, but we’re looking to get more, that will probably be more impactful in the second half of the year when you think about 10%.

And then finally, you mentioned the technology and how the MVP system was getting some traction. Obviously we've seen some big increases in the amount of sand that's used and I know that MVP has some design to improve the suspension of proppants.

Is that related at all or you think it's more just companies having time to look at something different?

No, it’s directly related. So the balance of the MVP system is that well productivity is higher and that’s what we’ve seen in Canada and we’ve had that demonstrated now for a couple of years and that’s just the process expansion in the fractures, so last year about 20% of the work we’re doing in Canada was using MVP and that was mainly as much as anything driven by productivity increases in the well.

But during this downturn, the other aspect of MVP is you can run less water and a higher sand concentration. And our customers are all looking at addition additional sand I think in all of America, not just in the US and the MVP allows you to do that more successfully.

So that is a big driver of why we’ve seen some increased activity in that area now is that ultimately it helps our customers place more sand in a little bit lower cost.

Mike, do you have an expected timeline where you believe you should have a decision on the credit amendments or waivers to be solidified at this stage?

I don’t have an exact timeline, I would expect that by the end of Q2 or thereabouts that we would have something finalized.

With all of the port capacity that you have in Canada and the US, is all of that going to be ring fenced or will some of that be activated or rotated through the active fleet in an attempt to try to both keep it active but also reduce your cash O&M expense?

It’s right, that’s to try and make sure that we’re not maintaining equipment that should be parked and also prevent that break in parking. So no, we ring fence the equipment in downturns.

The incremental idling of US capacity, will that be relocated back to Canada or remain in the US for the time being?

Remain in the US.

Dale, I realize that you said you didn't want to make any further comments on Russia, but can you give any sense of how long conversations have been ongoing or when we should expect an update at this stage?

I would stick to my commentary that we’re not going to comment on the deal that we’re not sure right now.

On your comments about MVP and the success that you’re having in potentially licensing it to certain customers. It that referenced to licensing it to competitors or producers, and if it’s producers, why would they need to license the technology from you relative to just use you?

It’s producers that have vertically integrated fracturing fleets in the US. So it’s a quite a few producers that do have their own fracture in place in the US and so there is two that we’re dealing with right now, one actually is going to be running here shortly using their own fracturing equipment.

In the outlook section, you talked about winning new customers in the US in April. Can you give a sense of what pricing was on those contract wins versus where it was relative to 2014 year end or even what you saw in Q1?

The work we’re winning now is about 20% to 25% below where it would have been in 2014 at the peak. That’s kind of where I think we see pricing in the US.

We saw it drop 15% in Q1, it’s going to go a bit lower and then you’d see stabilizing after that.

Is it fairly universal, those price drops across all regions at this stage?

No, it is very – we try to make statements about overall US pricing, but the reality is you get different pricing numbers. It’s down everywhere.

It’s going to be down a bit more in the oil plays obviously like the Bakken, the Permian, the Eagle Ford, but we won’t get into specific pricing, however, we talk more about it generally.

Can you talk about what idling of your US Bakken operations actually entails and if you were to get a meaningful contract tomorrow, how quickly could you actually reactivate work in that region? And then maybe more broadly just on the US platform in general, do you believe you could add incremental crews if there was demand in the next six months?

The Bakken is one that we approach a little differently than say we did on our long view idling. We have very good operations crews in those areas and so in that particular area what we did is we idled the base and the equipment and dispersed the key people throughout our organization elsewhere and so that allows us to still working there and a lot of this is to activate pretty quickly if we had to.

So we kept the flexibility on there because we do have some irons in the fire on additional Bakken work that we didn’t want to forsake and it allows us to – it’s a slightly more costly solution because you do have some people working in other areas of the US, but it’s not a lot more and allows us to wrap up quickly if we were to see some improvements in that area.

You referenced to small share buyback to date, I'm assuming the NCIB is off the table for the foreseeable future?

Yeah, it completely is. And to clarify that, we initiated an automatic share purchase buyback in our Q3 2014 board meeting in November.

At that point in time, we still had expected a much better Q1 than obviously what we’ve recorded. So because it was an automatic share purchase plan, there was a small carry forward into early January that occurred.

But that’s been completely shutdown effective basically mid-January of 2015 through to date, and won’t be utilized in the near term and not expected to for the remainder of 2015.

Last one just from me. Mike, I realize that you're going to have significant working capital inflows in 2015, so this probably shouldn't be a problem, but as you review the credit facilities with your lenders, is there any restrictions on actually accessing your facilities at this point given that there is some conversations about covenant relief?

No, there is not.

Dale, when you talked about market share increases, I presume you have displaced incumbent providers with new customers and I understand you probably don't want to name the specific companies you have displaced, if that's right, that theory is right, but can you broadly characterize who those players are either by size or are they public, private, just any color would be appreciated.

Yeah, so there is a wide variety of sizes quite honestly. So in some cases, it would be smaller companies and in other cases they’re mid-size and in other cases there would be a division of a multinational.

So I actually think it’s got quite broad and I don’t think there is a predominance to any one type of customer and we’re winning new contracts. So I would say the ones that everyone targets and we target as well are the ones that have the highest activity levels that are going to give us high utilization and a lot of sustained program in a well by well basis, or some choppiness in their programs.

So that’s what we target, that’s what everyone targets in these types of environment. So that would be – there are some various sized companies on that, but that probably more on mid-sized companies that deliver you that.

But [indiscernible] being kind of up and down across the board, maybe a little predominance for the mid-size independents.

If you guys were to start looking at acquisitions in the US, for example, would you be willing to look at region specific providers in areas where you perhaps not had as much success. Would you consider going and look at something in East Texas or the Bakken or would you try to stick with areas that have been more fruitful to you like the Marcellus?

No, you’re 100% right in that there are certain areas – if I just back up, our belief is that coming out of this downturn that we’re going to be in a low cost environment for some time, which means we’re going to have to be a very cost competitive company, but we’re also going to have to be relevant in certain plays. And by relevant, we have to be larger in certain plays so that we have better customer presence, a little bit wider customer base and a lower cost structure in those plays, which means that there are a few areas where we could augment our company by some local players that have strong management teams, strong customer relations in the region.

And so strategically that does makes sense to us. We feel comfortable that we could layer them into us and there is a couple of areas that we could see potential opportunities for bringing in someone that’s quite strong in a region and put our equipment into their type of team in that region.

And then just two last ones from me, they're both quick. I know you talked about the percentage fleet in Canada, eight fleets that are marketed in the US.

How much horsepower specifically is idle in the US?

Right now, it’s around 300,000 horsepower idled, so that’s half the fleet.

And then when you talk about the Bakken being sort of suspended, suspending the operations, were those crews, were they local residents or were they being transported in? I'm trying to understand as we think about what the labor situation might be like in a recovery.

In that particular case those crews were local. We weren't really into the mode of transporting or flying in workers there.

I had a question regarding the NDP’s victory in Alberta, election victory in Alberta. They have place to review their royalty rates and the corporate tax rate.

And I’m just wondering how that is being viewed by yourself and the wider industry?

I think we would be consistent with the wider industry and that we’re waiting to see how they react going forward and I think there is a little bit of uncertainty in the business right now as they develop their policies and also they proceed with the initiatives that they wanted to go down. I would say that they have reached out to the industry and have been cooperative in finding out more about the current cost structure within the industry.

That’s positive and I anticipate it will be a complicated process. The most part of it is actually our customer base more than the size, but if our customer base slowed down activity, it will affect us.

And today, I would say that a lot of our customers are in a wait-and-see mode, but comfortable with the fact that they are going to be heard on the issues.

Hey, gentlemen, I appreciate the sensitivity surrounding the Russia thing. I'm not going to push harder there, but to take the other side of it is, are the negotiations with your lenders on the covenant release contingent on the conclusion of the Russian sale?

No, they’re not. They obviously play a factor into those negotiations, but we’ve had indications in conversations that we could get a deal done either way, but obviously the terms of that might be different depending on where that will come.

Of course. But just for clarity, there's a scenario where the Russian situation is stretching out, maybe taking a bit longer but you've got covenant renegotiations and that's done and announced and Russia happens after, if at all.

I believe so. I mean, it’s obviously subject to finalization of everything.

But certainly when we started talking to the lenders, the Russian deal was not very significant at that point in time.

And then just again on the working capital draw, I appreciate you guys have pushed on this, so just try one more shot. The majority of activity decline happened in Q1 as you mentioned, but I was just wondering how much of a majority, was it just like 60%, 80%?

To put it in other way, I’m wondering has your activity bottomed meaning you have a pretty good feel for what the working capital is in Q2 or is it still trending a little bit lower meaning you've still got more working capital to harvest to come from this point from Q2 onward?

It’s still trending a little bit lower obviously with break up, you will see lower activity levels in April, May in particular and depending on how customers react even potentially June. So when you really see the activity in the revenue on a month over month basis, starting at a high point in January and expect them to be bottomed out in Q2.

So as a result, that’s going to be kind of one of your major drivers of the working capital release, is a fact. And then as Dale had mentioned in his conversation about the US side of things, we still saw some weakening in activity and revenue in the first part of Q2 and expect to see improvements throughout Q2.

So again, we believe the bottoming point will be in the second quarter in both of our major regions and as a result you’ll get more – a little bit more working capital release on that. But unfortunately the results aren’t extremely profitable, so that mutes some of that working capital release.

And then just last one from me. You mentioned unsustainably low pricing.

I don't think anyone's going to disagree with that. And so at some point we're going to see a turn, but is it still falling at this point or has it reached a point where it's sort of in the bottoming stage on the pricing?

I would say our go forward tenders which is lot of the stuff that’s in the Q3 timeframe, it’s – we are seeing quite a bit more stability for the most part. So not a lot of pricing in the US, in particular, we’re at a good – prices drop more severely.

In Canada, there might be a little bit more room on it, but overall, again, at this point in time, our view is getting stable in the Q3 timeframe.

I just had a follow-up question on the job reductions. Where is your workforce now roughly and can you break it down for Canada and the US?

In terms of workforce reductions percentage wise or?

Total headcount?

In the US, we’ve had more reductions than in Canada. As I mentioned earlier in the call, if you’re on it, we’ve taken an approach of reducing salaries in Canada a little bit more to try and preserve our people, and in Canada we’re sitting around 35% reduction in staff and in the US we’d be closer to 58% reduction, where we’ve taken a little bit more layoff approach in that market.

I was wondering what the actual headcount is now, number of people?

The actual numbers, I don’t have it available in front of me. I have that, of course, but not available in front of me, so if you could follow me up offline, I can get you the actual numbers if you want.

I just wanted to ask something about the sale of Russian and Kazakhstan operations. I realize you don't want to say who is bidding for it, but can you give us an indication as it somebody that's already in that market or is that somebody that's looking to get into that market?

The same comment that I put in the article already that we won’t comment on anything to do with the sale other than we discussed.

Just a quick follow-up from me. You've got a bunch of idled equipment and you suggested that when we see a recovery it may be sort of muted or not certainly to the peak levels we saw in 2014.

I'm just wondering, at some point you've got a fleet that potentially exceeds the demand of your customers. Is it feasible that if you decided to go in a cannibalization route you could drive maintenance CapEx to an incredibly low number or would your sort of preference be potentially to sell assets if there was a market for them?

Depends on our view of how bad it gets, quite honestly. I guess if the market got to just absolutely brutally bad where pricing drops another level and things like that, you’re going to do whatever you can to make positive operating income quite honestly.

And if we had to reduce our R&M further, then we’d look at that very reluctantly. But we don’t anticipate that and I don’t anticipate that.

I actually think pricing will now we’ll probably start seeing some improvement at some point in time off of unsustainable low levels. The long term view of the market will cause us to look at asset sales in that business.

If we didn’t think within a year or two that we could put that equipment back to work to profitable operating income, then we’ll have to look at those kind of things as to whether that’s the best for the company. But it also depends on what you get for your asset sales and further to that we’d also look at deploying in other regions or whatever it may be and where we can get a return on our parked equipment, because our equipment is expensive, but having it against the fence a lot of the time isn’t good for the company.

A few follow-up questions on those. In Russia and Kazakhstan, the $70 million of PP&E on the international segment at the end of Q1, how much of that was in those two countries?

We don’t disclose the breakdown of the international and again it’s $70 million of international, obviously a big chunk of that is Russia and Kazakhstan.

Assuming the sale of the Russian and Kazakhstan businesses is completed, how do you think about the international business strategically or is it a business that you think is worth operating?

Strategically we still have interest in areas where we can get significant revenue and areas that are not as competitive as others. And so areas like Saudi Arabia, for example, where it is a large pressure pumping market are things that – we’re in that region because we believe that we can build a significant revenue base there.

Australia, when we entered the market, we certainly were of that opinion that the fraction market would start kicking in there and we’re still looking at that as to when that will happen. But that’s I think our criteria strategically and that’s some size, it shouldn’t be an over-competitive market where you got a whole bunch of small players as to whether we’re going to be in there.

Saying that, in a downturn like we’re in right now, we also have to make sure we don’t have any loss areas. So it has to at least carry its weight during the short-term.

So we certainly focus in a year like this one that we don’t [indiscernible] for any length of time. We’ll take a period of time, a month or two, or a quarter, but we’re in the mood to running it all year along.

So we kind of counterbalance the short term with the long term view on that.

Is it safe to say on the Australian side that you have some concerns about the ability of that business to be profitable short and medium term?

No. I think there is contract potential right now.

As we said in the press release, we have to contracts outstanding, we’re just kind of waiting here about – that improves that business. It’s not that far off of profitability right now, quite honestly.

So it’s an area for contract wins help that area quite quickly.

In terms of the debt side of the covenants, notwithstanding the comment about being able to secure covenant relief without selling Russia, if you were not able to come to a deal to sell the Russian and Kazakhstan business, do you believe you need to have some sort of monetization or liquidity added into the business to get through this downturn?

Not at this stage and certainly on the covenant relief negotiations that hasn’t been discussed.

Thank you for your interest in Trican today and we certainly look forward to talking to you at the end of July after our second quarter is complete. Have a good day.

Thank you.