Dale Dusterhoft - Chief Executive Officer, Non-Independent Director Mike Baldwin - Chief Financial Officer, Senior Vice President, Finance Don Luft - President, Chief Operating Officer, Non-Independent Director Jason Cockerill - Senior Director, Finance & Treasury at Trican Well Service Ltd.

Sean Meakim - JPMorgan Maynard Holt - Tudor, Pickering, Holt Scott Treadwell - TD Securities Dana Benner - AltaCorp Capital Brian Purdy - PI Financial Jon Morrison - CIBC World Markets Jeff Fetterly - Peters & Company Mike Mazar - BMO Capital Markets

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

I would like to thank you for attending the Trican Well Service conference call for the third quarter of 2015. Here is 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 will then open the call up for questions. Joining us today and available to address questions is also Don Luft, our President and Chief Operating Officer and Jason Cockerill our Senior Finance Director of Treasury.

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 would 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 and completions activity, general global economic, political and business conditions, our ability to obtain financing and to meet requirements of our financing agreements, our ability to achieve planned cost reductions, weather conditions, regulatory changes, the successful exploitation and integration of technology, customer acceptance of technology 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 third quarter results were released yesterday and are available on our website at www.tricanwellservice.com.

As noted in our press release, consolidated revenue for the third quarter of 2015 was $325 million, a decrease of 53% compared to the third quarter of 2014. The adjusted loss was $53.6 million and the adjusted diluted loss per share was $0.36 compared to an adjusted profit of $36.2 million and adjusted diluted gain per share of $0.24 in the same period of 2014.

Our adjusted operating income includes the total add back of $9.4 million for severance costs base closure expenses and professional fees related to the Russian sale and the amended debt agreement. These items are allowed to be added back to EBITDA for covenant calculation purposes.

Funds used in operation were $16.3 million compared to funds provided by operations of $102.1 million in the third quarter of 2014. Canadian revenue in the third quarter of 2015 decreased by 46% compared to the third quarter of 2014.

Job count decreased by 44% compared to the same period in 2014, due largely to reduced drilling and completions activity caused by low commodity prices. 35% of our equipment remained idle during the quarter to adjust to market conditions and activity levels.

Utilization was strong throughout the quarter as we ran full utilization on the active equipment and revenue per job decreased by 6% due largely to a 25% year-over-year drop in overall Canadian pricing. Adjusted Canadian operating income for the third quarter of 2015 was $37.4 million as compared to $97.3 million for the same period in 2014, due to decreased pricing and demand for our services.

Our Canadian region continued to focus on reducing costs. Canadian operations fixed cost structure has been reduced by 41% since the beginning of 2015 as a result of workforce reductions, discretionary spending reductions and lower compensation programs.

For our U.S. operations, revenue decreased 62% on a year-over-year basis, due to a significant decrease in customer activity in all areas, but most notably in oil-producing regions.

This led to an adjusted operating loss of negative $13.7 million as compared to an operating profit of $19.6 million in the same period of 2014. Revenue per job declined by 48% compared to the third quarter of 2014, largely as a result of a 30% decline in pricing and changes in both, product and geographic sales mix.

Job count in the U.S., decreased by 24% year-over-year, due to lower activity. Lower activity led to reduced operating leverage on our fixed cost structure, which contributed to the margin decline.

We have meaningfully reduced the U.S. operations cost structure and continued to adjust it to current industry activity and operating conditions.

We have reduce the U.S. operations fixed cost structure by 16% during the third quarter on a sequential basis and 51% since the fourth quarter of last year while operational results benefited from 15% to 25% price reductions for proppant, cement, chemicals, third-party hauling, fuel and parts.

Our international operations include financial results for our Russian completion tools business, Kazakhstan, Saudi Arabia, Columbia and Norway. Operations are currently suspended in Saudi Arabia and Columbia and the Russian pressure pumping business in Australia are now considered discontinued operations.

International revenue decreased by 12% on a year-over-year basis, lower activity in Kazakhstan and a change in job mix contributed to the drop in the international revenue while strong activity levels in Norway and our Russian completion tools business helped offset some of those revenue losses. Operating conditions continue to be challenging in Kazakhstan and the exit from Australia and suspension of both, our Columbia and Saudi operations contributed to the drop in revenue year-over-year.

International operating margin in the third quarter increased by 293 basis points on a year-over-year basis. Our reduction of headcount and share unit expenses contributed to the margin improvement.

Our completion tools division in both, Norway and Russia had a strong third quarter and we continue to be very happy with our technical advantage in this area, which has resulted in market share growth and good profitability. Given the sharp decrease in North American activity levels, cost control has been a key focus for Trican in 2015.

Cost of sales, which includes consumable products and product transportation costs is our largest category and represents approximately 50% of our total cost. Total average product cost reductions to-date have been approximately 10% to 15% in Canada and 15% to 20% in the U.S.

compared to product cost at the end of 2014. The weakening of the Canadian dollar has had an impact on the total realized cost savings in Canada.

Corporate cost-cutting measures continued during the third quarter of 2015, excluding charges incurred during the quarter such as severance and professional and legal fees related to our Russian sale and debt amendment negotiations. Corporate expenses in the third quarter of 2015 were $12.8 million or approximately 70% lower compared to the third quarter of 2014, excluding these costs.

The decrease is largely due to headcount salary reductions and reduction in discretionary expenses. Managing cash flow and strengthening the balance sheet continued to be a primary focus for Trican during the third quarter of 2015 and will continue to be a focus during the duration of the downturn.

In addition to significant cost-cutting measures, several other measures were taken during the first three quarters of 2015 that are expected to preserve liquidity and provide financial flexibility in 2015. We exited the third quarter with $550 million of cash and available debt, including the $195 million of cash from our Russian sale, which is earmarked for paying down debt upon closing of our debt amendments.

Capital expenditures for the first nine months of 2015 totaled $21.4 million compared to $54.5 million for the same period in 2014. With the decline in commodity prices and North American demand, capital expenditures will be kept to a bare minimum until operating conditions improve.

We continue to maintain our equipment in all regions and the majority of these costs flow through our income statement and are not capitalized. Additionally, 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 approximately $30 million during 2015. Spending on capital projects is currently limited to completion of existing entities [ph] and spending that is critical to maintaining or increasing the Company's near-term cash flow.

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. On September 25, 2015, we reach an agreement in principle with the lenders and note holders amending the terms of our lending agreements.

We expect to finalize these agreements later today on the same terms and conditions of the agreements in principle. I will now turn the call over to Dale, who will be providing comments on operating conditions and strategic outlooks.

Thanks Mike. We are very pleased with our Canadian results.

Although we saw significant improvement in our U.S. results, we continue to work on improving our performance in this region.

In Canada, pressure pumping activity levels have rebounded substantially from the normal weather-related lows that we experienced in the second quarter. Overall industry activity in Canada remained low in the third quarter, with the number of active drilling rigs in Canada down over 50% relative to the third quarter of last year.

As a result of the reduced demand and excess of equipment, average Canadian pricing declined by 25% compared to the third quarter of 2014. The key to profitability in this low-price environment is to correctly size our operations to the anticipated activity levels and run full utilization on the equipment that we are running.

We continue to be of the opinion that we have appropriately sized the Canadian operations to the current work scope evidenced by our financial results in the third quarter. Our customer bases remained loyal and market share gains with active customers are expected to result in continued good utilization on our active equipment fleet during the fourth quarter and into 2016.

At the present time, most of our customers are indicating that their work programs will remain strong in the first quarter after a normal ramp up in January after the Christmas season. We continue to monitor their plans going forward.

Our focus on technology, service efficiency and technical solutions for our clients, continues to be a differentiator from our competition that helps us maintain and grow market share and lower cost to our clients without lowering our margins. October and November utilization has dropped slightly due to normal weather-related issues experienced at this time of year, but remains high.

However based on an expected extended seasonal slowdown and customers shutting down their programs around December, we expect Canadian operating income to decrease in the fourth quarter versus the third quarter. We will continue to focus on reducing cost in the upcoming quarters and ensuring that we adjust our equipment fleet both, up and down to match anticipated activity levels.

In the U.S., we saw significant sequential improvement in our operating income, which is however still below our expectations. Our utilization improved substantially over Q2 levels as we reposition most to our fracturing crews with new customers in the second quarter and realize the results of these efforts in the third quarter.

We run 8 of 16 fracturing crews in the third quarter with the utilization in July and August in the 65% to 70% range. August results was strong, but fell off substantially in September as all of our crews in the Marcellus were shutdown for various customer scheduling issues in the second half of September.

This combined with weak utilization on our spot market crews in Texas in the latter part of the quarter drove down our U.S. results for the quarter below our expectations.

As a result of inconsistent utilization, our one crew in the Eagle Ford and our one crew in the Permian, we have parked both of our Texas based fracturing crews in October, which will reduce our operating losses in these regions. This leaves us with four crews in the Marcellus and two crews in Oklahoma.

Five of our six remaining active crews are committed into 2016, with four crews committed to 2017 at good pricing levels with anticipated higher utilization. Initial indications from our five committed customers are that Q1 activity will be strong and we continue to monitor our customers' plans for any changes to their programs.

We continue to run coiled tubing and cementing services out of the Permian and Eagle Ford locations. Overall U.S.

pricing declined slightly during the quarter and was down approximately 30% from the relative peak levels at the end of 2014. Pricing appears to have stabilized at these levels as most of our equipment is committed to customers for next year.

Although industry conditions are weakening sequentially in the U.S., due to an expected extended holiday slowdown, we anticipate that our results will improve in the fourth quarter as a result of cost savings of shutting down our Texas fracturing crews and our remaining crews running at high utilization in positive contribution contract through October and November. We will see a slowing of activity in December, and our customer shutdown their programs earlier than we anticipate, it may have an impact on our predicted fourth quarter profitability.

As in Canada, we have not reduced our spending on equipment maintenance and all of our product equipments could be put back into service at any time with minimal cost. We continue to implement technology in our U.S.

region and our continued grow of our MVP fracturing fluid which allows higher sand concentrations replace with less fluid and our diverted technology which allows diversion of fracturing treatments in both, new and refracted wells, Both technologies yield higher production for our clients. Cost reductions and sizing the business to current activity levels continues to be our primary focus.

We have been successful in reducing the cost of key products by 15% to 25% to-date and continue to work towards further reductions. Headcount has been reduced and we continue to evaluate and implement further cost improvements and efficiencies in an effort to generate consistent positive cash flow.

We are of the opinion that industry activity levels will not meaningfully increase in the near-term. As such, continued vigilance on the U.S.

operations' costs structure, keeping utilization high on our active equipment and quickly reacting to changes in customer's workflows are critical for the remainder of 2015 and into next year. We are comfortable with our contract position entering 2016 and our customers intend to keep utilization high on five of our six crews with pricing that is already negotiated.

We will look for opportunities to deploy additional equipment in the New Year in our core areas to increase our leverage on our cost structure and improve operating results. We have reached an agreement with our lenders on revised covenant terms and expect the documentation to be finalized today.

We have seen substantial improvement in our operating income in the second half year of the year and believe we will further reduce our U.S. losses in the upcoming quarters.

We also maintain our dedication to strategic initiatives to reduce our debt level and we believe that we can be successful in de-levering our balance sheet. We are confident that if we are successful in doing so, this together with our improvements in operating income achieved during the second half of 2015 and a continued focus on cost control will allow us to continue to be a covenant through next year.

We are continuing to negotiate the sale of our Kazakhstan pressure pumping business. Antimonopoly approval is not been completed yet, but we expect to close this transaction in the fourth quarter.

Notwithstanding the pending sale of our Kazakhstan, our completions tool business in Norway and Russia has become our primary international operations and we continue to be happy with the profitability and market share gains we have made. We discontinued operations in Australia and Saudi Arabia during the quarter due to low activity levels caused by commodity prices and reduced activity.

Sale of our Russian business also affected profitability of these regions, due to burdening the smaller regions with infrastructure required to run international operations. We are now a North American-focused Company and will work on improving the profitability of our North American business during this shutdown or during the downturn and positioning it to be able to capitalize on an eventual turnaround.

We do believe we have substantial international operating expense and we will continue to evaluate strategic international opportunities as they materialize. Our Management team has experienced several business cycles and understands what is needed to survive in 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, reducing our corporate costs, selling a meaningful portion of our international business and fishing operations in non-profitable areas.

Our main focus in the near-term will be continue to reduce costs, increase profitability, finalize the sale of our Kazakhstan business and further reduce our debt levels. We remain confident in our ability to execute on the strategy needed to manage through the current downturn and expect to emerge as stronger organization.

Thank you for your attention today and your interest in Trican. I would like to turn the call over to the operator for any questions.

Hi. Good morning.

Hi Sean.

I was hoping just a quick question to start, on the crews you shut down in Texas, can you give us a sense of when you shutdown them down during the quarter as we are just trying to think about the sequential impact on cost in the fourth quarter.

Yes. We have shut them down kind of later in October timeframe, so that an impact on October numbers, but kind of come out of it for November-December.

Okay. Got it.

Still it could have been more that we can see there. Okay.

Then as we think about the potential drop off in activity coming around the holiday season, you know, in your discussions with your customers and kind of what is on your work board. Is your sense that there are going to be more folks inclined to reload budgets and start to clear through some duck inventory early in one 1Q or do you think folks are unlikely to sit back and see what happens with commodity prices or it would it be a more a mixed bag of those two outcomes?

Well, you are talking in our U.S. operations or both areas?

Both of those…

In our U.S. operations as I mentioned, we are really down to just working for committing clients and most of these clients are relationships that we have had for some time now and through the second half of the year and their initialize files right now are to come back after the holiday season with pretty strong programs, so at present time, we are not seeing pull back or any indications of a pullback.

We will continue to monitor it and just see if they change their plans going forward, but right now I would say they are coming out of this year fairly hard than in the first quarter.

It is those relationships that level of activity, you have line of sight on coupled with the cost savings that is what gives you the confidence in terms of hitting those hurdles through the first quarter, is that right?

That is correct. Yes.

Okay. Very good.

Thanks, Dale. I appreciate it.

Yes. Thanks, Sean.

Good morning, guys.

Hi.

Since the Q4 is going to be noisy for your U.S. operations, I was just wondering if you could set the baseline for us in terms of thinking about Q3.

I mean, I think over the last several quarters, I thought your Texas operations is being certainly less profitable than your Northeast operations, which I seem to recall have been among your best regional performers over time in the U.S., so if had you stripped out the Texas operations in Q3, might you guys have been close to operating income breakeven in Q3. I am just trying to set a baseline since Q4 sort of noisy with holiday impacts.

Right, yes. The Texas operations were to be in just a little over half of our losses in the third quarter, the 60% range you kind of thing.

The other thing that hurt us we mentioned in the call is had a real substantial slowdown almost for three weeks in the Marcellus in September. As you mentioned the Marcellus is our most profitable area if that goes to breakeven or negative that has a pretty big impact.

That was a one-time deal. It was just all of our customer shutting down at the same time for various issues, all related to scheduling and just getting pads ready in various type of normal oilfield type issues, so that that had a fairly large impact, but overall the Texas operations were the majority of our losses in the quarter.

Then sticking with the U.S. operations for your crews that are committed into 2016, because those crews are committed whatever the order of magnitude of top-line erosion that you see, sequentially, in the U.S.

is reasonable to think that fairly high decremental margin is just because you are keeping your crews in place for the Q1 activity rebound is that fair?

Yes. I think that is a good way to look at it and whole key to putting out positive EBITDA on those crews and there is the utilization level and that is something that we never know exactly how it is going to play out, because there is dropped scheduling issues or weather issues and whatever, but as long as the utilization level remains high, the contracts are all negotiated to be positive EBITDA contracts and I will say we are not negotiating an unrealistic utilization level, but that will be the key, how it shakes out in the quarter will be really dependent on how utilization shakes out and when we get going after Christmas and all those kind of things.

Okay. Then last question for me for your Canada operations given they posted such strong Q3 results, you mention Q4 down, sequentially, but I did not hear anything from you in terms of the way you described, your customers' mindset and work programs for the winter drilling season that would suggest that Q1 would not at least be potentially flat sequentially?

Yes. Our customers right now and it is a bit early.

I would not say that all of them have finalized their budgets, but early indications from our clients are that they are going to remain quite strong through Q1 and…

Thanks guys.

Okay. Thank you.

Thanks. Good morning guys.

A couple of housekeeping questions, in terms of compliance with the covenants for the Q3 number, should we be using that sort of adjusted round number $20 million, operating number as a good proxy for the EBITDA that you used for those covenants?

Yes. Scott to be clear, under the new agreement, we do not have any covenants for the third quarter of 2015.

Yes.

The only real impact there is on cumulative EBITDA test that we have at the end of the Q1 of 2016, which would include Q3 as part of the cumulative number.

That would be the $20 million?

Yes. That is correct.

Perfect. Then the liquidity test, I just wanted to make sure I am clear on this, is that cash and available draw on the line or is that simply cash and working capital that the liquidity test at the end of Q1 is?

It is cash and available draw on the line.

Okay. Cash plus draw.

Perfect. Good.

Last one for me, you talked about shutting down some crews here in Texas for Q4, any idea on the magnitude of restructuring cost either just from that or incremental that you are expecting to see in Q4?

Sure. Kind of the restructuring cost I think are probably in the $1 million dollar range.

Then the expectation of savings on a quarterly basis, full quarter basis are probably in say $4 million dollar range. That is basically where we are coming at.

Obviously, fluctuates depends on where the revenue was coming in and all that good stuff, so it is a bit difficult to do, but trying to give you a bit of a benchmark on where we think it would be relative to what we saw in Q4.

Okay. Right.

Actually I do have one more and I am not sure how much detail you want to go into this, but if I exclude the Russian stuff, and we potentially exclude Kazakhstan. Then the shutdown operation, the stuff that is going to continue through '16 assuming Kazakhstan does get sold, can you tell us year-to-date kind of what that revenue has been just as a sort of round number.

If you actually take a look at the disclosure, I think that the year-to-date numbers on continuing operations have been adjusted, so I do not remember the number off the top of my head, but it is more largely that and I guess the only one that really needs to be excluded there pretty much Kazakhstan, so not sure what the exact number is once I exclude that, I would have to get back on that Scott.

Okay. Yes.

That was really the delta was Kazakhstan. I am happy to take that offline.

That is all I have got guys. I appreciate the color.

Okay. Thanks.

Good morning, guys.

Good morning, Dana.

I wanted to start with the SG&A line, I guess not surprisingly it is a dramatic decline, but it is really dramatic decline, sequentially, and maybe help us understand what that variable looks like going forward.

If you take a look at, and I am presuming you are talking on primarily the corporate side of things. Is that right?

Yes. Just generally.

The big impact that happened in the third quarter was the impact of stock -based compensation, so particular the RSUs and DSUs Bob and those types of things. Because they are cash-based, they are mark-to-market off of our share price, so as our share price declined in the third quarter, we realized significant recovery in those costs.

On the corporate side of things, that recovery was about $3 million, so you kind of have to you back that out, so I think if you go and take a look at where the numbers all fall in right now I would say that our corporate cost, excluding the impact of that are probably coming around $9 million and we are looking at other ways to kind of further reduce the number.

Yes. I guess further to that, the reduction in the U.S.

is primarily just structural. There was more reductions in headcount and operating structure to kind of further right sized the business to the new revenue and income levels, so that area there would be kind of a go-forward cost that is built in the system now.

Great. I guess, I should have been more specific, so really what I am looking for is, ignoring the stock-based comp etcetera, in terms of our run rate underlying, say, G&A or whatever, what do you think that number is now, $9 million?

Yes. On the corporate expense that is what the number comes in.

Okay. Thank you.

Secondly, in the U.S. I am sure you guys are all over the calibration of utilization and capacity et cetera, but why run that six spot crew if you are not entirely sure that you get the kind of utilization you want or do you just have enough visibility to be able to keep it active?

Yes. We are negotiating with some clients to keep that crew busy.

If we don't see that come through then we will adjust up and down our equipment all the way through, but I would say there are some opportunities to keep that crew at profitable levels up in the Marcellus region. It is something we continue to work on it.

Okay. I guess, thirdly, just on the impairment Mostly, PP&E maybe you could give us a bit more color on that.

You are the first one that we have seen at least among the fractors in Canada, so help us understand that please.

Sure. Obviously, that has been our primarily weaker results that we have seen throughout the year I would say that I can't give you a lot of color on what other people have done, but certainly the results that we have had through first three quarters of 2015 and the challenges that we have had to improve financial results to a positive level combined with kind of a more negative outlook through 2016 and 2017 now probably were the primary drivers for that write-down, so I think those were the biggest reasons for the numbers coming down and those were certainly the discussions we had during the quarter.

Can you comment on the split, say, between Canada, the U.S. at all?

Yes so in regards to the PP&E in that it was on the U.S. There was no impairment to any of our Canadian operations.

There was an impairment on the goodwill side of things not related to our completion tools business, and then there were some inventory impairment, which was again largely related to our completion tools business.

Great. Last question for me, with respect to '016 CapEx probably a bit early, but should we use $30 million again is probably a good starting point?

I think that is a good starting point. Yes, Dana.

Okay I will turn it back. Thank you.

Good morning, guys.

Hi, Brian.

I just want to ask about you mentioned a few times the commitments that you have some customers in the U.S. I am just wondering if these have changed at all from what you saw previously and how comfortable you are with the utilization rates that you will get out of those.

Are you sort of first call for these customers or is this something different, yes. Our customer commitments some of those commitments we have had in place for a few years and others we renegotiated it in Q2, so we have been working for them kind of premises June timeframe and all the commitments are contracts.

They are basically contracts, but the contracts to contracts in our oil - but basically they all have expected volume fracs and price per is essentially how they are designed and the customers basically will outline what their plans are and what their expected volumes are. I would say that they order them.

They do their very best to order them, but we do get utilization blips at times when there is weather issues or whether there is pad issues or water issues or something that comes up operationally with the clients and these utilization blips could be two weeks in nature sometimes on pads when they are moving between pads and sometimes that will hurt our results and that is cause utilization to drop off. I would say that commitment side of it, price is committed, the utilization targets are committed.

I think on a yearly basis those clients will miss or will make them, but they may miss them on a monthly basis times just due to some issue regarding like is said, operational issues.

Okay. Great.

Just looking at the U.S. business overall, I mean, obviously you are in a tight position here on the debt side, but the Canadian operations are showing such a big margin.

What you have to do to get the U.S. operations to zero?

I mean, do you think with the Texas crews being shutdown, you can get that EBITDA to at least to breakeven level or is there more work that you need to do there?

Yes. I think it is kind of as we outlined.

It is shutting down our so Texas crews is a big part of that. Then if we keep our utilization at acceptable levels on the remaining crews, as I mentioned earlier, we can run kind of small positive EBITDA levels.

That is basically how our cost structure is restructured.

Okay.

It is all about utilization. Brian, I think that is the key thing that will have to come through with.

Yes. Okay.

Thanks very much.

Yes. Thank you.

Good morning all.

Hi, Jon.

Just to follow on the previous questions around the contract that are committed crews at this point, just to get a better understanding of what that actually means. If any of those customers wanted to just break the contracts and they were not going to go forward with your development plans, would they pay some sort of a penalty at this point or basically you just shut those crews down they would not go to work?

Yes. There is no minimum commitment type payments, so anything like that in those contracts.

They are contracts that basically lock us into a fracturing crews with them and they would be first all type contracts, but if they are able to shutdown their programs because they changed their spending plans then we would have to find other work or basically shutdown those crews or do something on our side.

In terms of reference that you guys are making to for the crews going forward into 2017, if the market get stronger I am assuming that you have some escalation clause that pricing would move in line with the market for those contracted crews at this point?

Yes. Every contracts, but we normally have some clauses that allows us to get cost recovery particular.

Within the release you guys made quite a few references to the strong cost reductions you have been able to achieve in both, Canada and the U.S. As you look forward, do you think that there is more cost to be recovered from your vendors at this point and depending on whether the market goes up or down from here, do you believe that your input cost will largely move in line with pricing for the next four to five quarters?

No. I think for the most part we still see more cost reductions and more pricing reduction.

I would say for the most part, we are probably getting close to the end of the pricing reductions from our vendors. I mean, there is probably some other ways that we can save costs on doing replacements and that is everything that can probably get a little bit more out of it, but I think on the pricing side it is going to be tough to get it much further down.

We typically see when things turn around and it is actually, when you start seeing a pick up, you will get the utilization bump, which you will get some margin improvement there. You do not typically see the pricing from our vendors come up as quickly.

There is probably a quarter or two lag before that occurs, so you do not quite get that much there, but it does happen pretty quickly, like I say in a quarter or two, where you start getting some pricing improvements on your side that you get that match with cost increases on the pricing side on our vendors.

Can you comment on the operational status of your facilities outside of Oklahoman and Pennsylvanian and are you keeping those basis ready to go back to work or ultimately looking at removing your physical footprint in select markets at this stage?

We are still running as many internal operations in those agents which helps cover their profitable operations and they help to cover our fixed costs and just maintaining facilities. They are not huge contributors, but they do cover our costs or lot of costs in those areas...

Okay. You made a number of references to keeping all of the equipment in solid shape from an R&M perspective, but I just had one follow-up question on that side, if we take like the two crews in the U.S.

that you shutdown, if those crews needed R&M and you are ultimately parking them, are you putting in the capital and then parking them or ultimately you will do that maintenance once they go back to work?

Yes. Well, they were parked maintain and ready to go.

We would not have parked them broken, but I guess if a truck broke the day before we parked it but probably not going to fixed it in this kind of environment, so there would be a small amount of maintenance and improvements that we will have to make the equipment if you put it back into operations, but parts ready to go to work and should not be that big of a number.

I really think you guys have always pride yourself in having very well-maintained equipment, but just a high-level question I guess is, why not lean on some of the idle assets that you have for key consumables for the next 12 to 18 months. I realize that you won't hold that equipment to go back to work, but ultimately if there is consumable sitting in the yard, does that makes sense to pull them off since some of that probably won't go back to work for at least another 18 months?

Yes. We have not had to I guess.

It is the big issue in terms of like big motors and things like that. I think if we thought things got worse it is an option.

It is a lever we could pull to get us through the downtown better. We do not like doing it a quite honestly.

Primarily, we just think it gets into a bad operating practice, but it is another lever we could pull if we had to if we thought we needed to generate more EBITDA out of our operations.

Last one just for me, Mike, this a follow on to Dana's questions. Can you give any color on what was written down from an inventory perspective and is that just mark-to-market versus what you could buy those inventory items for at today or?

No. As I said to Dana, the majority of that write-down related to the completion tools, so that actually was some tools that we had built that were of a different size and different spec that we do not believe will be used the very much if at all over the next one to two years as a result it is more of an obsolescence write-down.

Okay. I appreciate the color.

I will turn it back.

Thanks, Jon.

Good morning, guys. A couple of random questions, first of I am trying to reconcile the U.S.

so you talked about running 65% to 70% utilization in July-August and generating a 4% operating margin positive. Sorry?

In August, we did.

Today you talk about running a 60% to 65% margin on the lower crew number. Do you expect at that utilization number that will generate positive operating margin?

Not for a whole year of operations in the quarter. No, primarily I think it is 60% to 65%, we are getting pretty close to a breakeven with the shutdown of the Texas crews, but due to December slowdown, we think that holds the quarter down to negative for sure.

Okay. When I think about Q4, excluding the $1 million you referenced earlier around restructuring for Texas, and it is likely that you have an operating loss.

It is just a more modest operating loss in Q4 relative to Q3?

That is correct.

Okay. The $194 million of cash on the balance sheet; how much of that do you expect to be allocated to debt repayment in Q4 versus future quarters.

$194 million of it is going in Q4.

Okay. You are going to retire the term debt that matures in November, and will you also be retiring the term debt that matures in April at the same time?

No. That restricted cash is related to the sale of the Russian assets.

In the amended agreement that we have negotiated, we had to held that cash to repay both, the bank revolver as well as the notes, so what ends up happening is the bank revolver and the notes get paid down on a pro rata basis, so they all go down, so it will happen in that November '15 repayment is there is still one there. It is just smaller than what it would have been previously due to the application of the Russian proceeds and that maturity stays as of November 15th, and then the April 2016 maturities also stay in place, but that repayment will be lower as a result of the application of the Russian proceeds.

Okay. The 194 goes pro rata across all the term debt series and the revolver?

That is correct.

Okay. Your commentary in the release has a little bit more wag in the context of Kazakhstan closing.

You referenced earlier that you are still waiting for Antimonopoly approval. Is there anything else beyond the regulatory side that is the barrier to the closing in Q4?

Yes. It just going slower than we anticipated primarily just due to dealing with [ph] just as much as anything, it hasn't been a higher priority for them quite honestly as much as anything.

One thing that the Russian deal done they had to absorb that and all their team has been working on that, so they are at it now in a much bigger way. We still anticipate that is we get a close, but we were delayed a little bit, while their team was just integrating the Russian operations.

Okay. The $12 million or so of assets that were classified as held for sale.

How realistic is it that you could realize and proceeds on that allocation in 2016?

We think it is very realistic. We have got quite a few people that are interested.

Okay. Last question for me, you put it into the release and obviously repeated a verbatim in the conference call, but your comments around strategic initiatives to reduce debt and deleveraging the balance sheet, can you provide a little bit more context in terms of what you are looking at or what you think it could be realistic for the Company in the foreseeable future?

Yes. Unfortunately I cannot provide a lot of guidance on that other than we have got a number of things that we are working on that we think are executable.

Okay. Great.

Thanks for wrapping up.

Yes. Thanks, Jeff.

Okay. Well, thank you very much.

Just seeing on my screen that Mike Mazar has come up is looking for a question, so you may want to check your line there. Mike might want to ask one.

Well, thanks I appreciate that, Dale. I hope the question is worthy of that additional time.

I just ducked you and I do not know why on that one boy.

Hi. You guys are doing well.

I was assuming somebody else was going to ask and then nobody did so I was like…

Just saying Mike wanted to catch off.

Yes. Look, if it is a question for me I am not answering it.

It is actually I think. It looks like, obviously, a good quarter.

You have certainly put yourselves on the right trajectory to kind of meeting the covenants and all that kind of that stuff, but as anything can happen. What are really the consequences of not doing this?

Let us say you fall short, you are at of $40 million by the end of Q1, what really happens? Is this kind of renegotiated all again?

Yes. I mean it is a good question.

Obviously, we would have to get in the conversations with our lenders again on where we go for here. Really it ultimately comes down to where they feel the prospects to the Company is going to be at and where we go, I mean obviously if we do have a breach then you get into a situation where they have the right to call the debt.

They do not necessarily do that. We are of the belief that with the cash flow generating capabilities of the Company that that is pretty unlikely, but I cannot get in the minds of all over lenders to know exactly how they think and that type of thing, so it really becomes something as you get closer to it and if you think that is going to be an issue you will certainly commence conversations with them.

Then based on those conversations, you go from there.

Sure. That makes sense.

Okay. Thanks guys.

That was all.

Thanks Mike.

Okay. Well, thank you very much for your interest in the Trican today.

We certainly look forward to talking to you after the next quarter is complete and have a great day. Thank you.