CES Energy : Announ Results for the Third Quarter Ended September 30, 2017 and Declares Cash Div

The financial results reported for the three months ended September 30, 2017 ("Q3 2017") and the nine months ended September 30, 2017 are reflective of the improvement in commodity prices that has led to a rebound in activity in the oil and gas industry. In contrast, although activity levels started to improve in the three months ended September 30, 2016 ("Q3 2016") from the lows experienced earlier in the year, the results for the three and nine months ended September 30, 2016, still presented challenging market conditions for the industry with both oil prices and activity levels bottoming in the first half of 2016. In Q3 2017, trough pricing levels continue to exist in CES' business lines, but the increase in activity has allowed CES to sell higher volumes of its products across its rationalized cost structure, and as a result, the financial results of CES in Q3 2017 and year-to-date are consistently improved in comparison to the results achieved in Q3 2016 and year-to-date 2016. Slightly offsetting these improvements are some one-time negative financial effects of Hurricane Harvey experienced in Q3 2017, which have been outlined below.

CES generated revenue of $260.9 million during Q3 2017, compared to $145.1 million for Q3 2016, an increase of

$115.8 million or 80%. Year-to-date, revenue totalled $750.8 million as compared to $380.0 million for the nine months ended September 30, 2016, representing an increase of $370.8 million or 98%. EBITDAC for Q3 2017 was

$39.1 million as compared to $16.6 million for Q3 2016, representing an increase of $22.5 million. Year-to-date, EBITDAC totalled $110.5 million as compared to $22.5 million for the nine months ended September 30, 2016, representing an increase of $88.0 million. Year-over-year, the Company's operating results benefited from increased activity levels due to the improved commodity price environment. Furthermore, Q3 2017 and year-to date include a full run-rate of results attributable to both the Permian based Catalyst Acquisition, completed in August 2016 and the StimWrx acquisition in Canada, completed in Q1 2017, where in the comparable periods there were only two months of results attributable to Catalyst and none attributable to StimWrx. As detailed below, in Q3 2017 and year-to-date, all facets of the business in the US and Canada have made positive contributions to revenue and EBITDAC.

Revenue generated in the US for Q3 2017 was $168.9 million compared to $92.8 million for Q3 2016, an increase of

$76.1 million or 82%. Year-to-date, revenue totaled $473.6 million, compared to $250.9 million for the nine months ended September 30, 2016, representing an increase of $222.7 million or 89% on a year-over-year basis. This year over year increase is as a result of the improved market conditions in 2017 with significant activity improvement in the drilling fluids business, and increased US Treatment Points, particularly in the Permian Basin as a result of the Catalyst Acquisition, for which there were only two months of associated revenues or Treatment Points in the comparable period in 2016. Offsetting these gains were the negative effects of Hurricane Harvey in Q3 2017, which caused a slowdown in activity in the Company's Eagle Ford shale operations deferring revenue by up to one week as operators suspended drilling operations, and there were location access issues resulting in delays in product

deliveries. In addition, although our barite mill in Corpus Christi, Texas was spared from the brunt of the effects of Hurricane Harvey, operations were suspended for six days as the plant was without power and later in the month one of the two mills was down as a result of water damage. Furthermore, the Company's US source revenue was negatively impacted by the devaluation of the US Dollar versus the Canadian Dollar in the current year on translation.

Revenue generated in Canada for Q3 2017 was $92.0 million compared to $52.3 million for Q3 2016, an increase of

$39.7 million or 76%. Year-to-date, revenue totaled $277.2 million, compared to $129.1 million for the nine months ended September 30, 2016, representing an increase of $148.1 million or 115% on a year-over-year basis. PureChem continued to gain market share in Canada in the production chemicals business as Canadian Treatment Points for Q3 2017 and year-to-date 2017 have increased 25% and 37%, respectively, from the comparative periods. During Q3 2017, the drilling fluids business increased its Operating Days by 70% over Q3 2016, in line with the increase in industry rig counts which increased by 74% over Q3 2016. The increase in revenues in Canada for the nine months ended September 30, 2017, was a result of improved market conditions and the expansion of our business in an environment experiencing increased activity levels and customer spending, and the contribution by StimWrx, which was acquired January 1, 2017, for which there were no associated revenues in the comparable periods.

In Q3 2017, CES recorded Cash Gross Margin of $71.7 million or 27% of revenue, compared to Cash Gross Margin of $40.7 million or 28% of revenue generated in the same period last year. Year-to-date, CES recorded Cash Gross Margin of $208.5 million or 28% of revenue, compared to Cash Gross Margin of $96.9 million or 25% of revenue generated in the same period last year. Although activity levels have improved from 2016, the Company continues to sell its products and services at trough pricing levels. CES has been able to pass through many of its input cost increases but has yet to realize any meaningful price increases for its products. The improvement in Cash Gross Margin as a percentage of revenue year-to-date in 2017 is evidence of the operating leverage in our consumable chemicals business model, and is as a result of the positive effects of the cost reduction initiatives taken in 2016, combined with increased activity levels as CES has come off its fixed cost base. However, during Q3 2017, Cash Gross Margin was negatively impacted by financial effects of Hurricane Harvey. In addition to the revenue related effects outlined above, from a cost perspective supply shortages particularly with respect to diesel, a primary input in most drilling fluids products in Texas, resulted in inflated diesel prices in September 2017 that could not be passed onto customers in the quarter. Furthermore, the Company paid a transportation premium to diesel suppliers for alternate delivery routes during the storm in order to continue to receive product.

Emerging from the downturn, CES' balance sheet is well positioned to capitalize on the improving oilfield activity. In Q3 2017, CES continued to build positive net working capital and as such increased its draw on its Senior Facility. In October 2017, CES successfully re-financed its $300.0 million Senior Notes by issuing new 6.375% Senior Notes which have an extended maturity into October 2024. In 2017 and 2018, it is expected that EBITDAC will exceed the sum of cash expenditures on interest, taxes, capital expenditures, and dividends.

CES also announced today that it will pay a cash dividend of $0.0025 per common share on December 15, 2017 to the shareholders of record at the close of business on November 30, 2017.

With respect to the third quarter results, CES will host a conference call / webcast at 9:00 am MT (11:00 am ET) on Friday, November 10, 2017.

North American toll-free: 1-(800)-377-0758 International / Toronto callers: (416)-340-2216

Link to Webcast: http://www.cesenergysolutions.com/

Calendar years 2015 and 2016 were extremely challenging as CES navigated through the protracted industry downturn. With the improvement in industry activity in the second half of 2016 and to date in 2017, CES continues to be modestly optimistic with its outlook. As the industry has rebounded, CES has gained market share in all of its segments by demonstrating to customers the benefits of CES' technologies, service, and attention to problem solving. CES has yet to realize any meaningful price increases in the recovery. The improvement in financial performance is evidence of the operating leverage in our consumable chemicals business model, and is a direct result of the cost reduction initiatives taken in 2016, combined with increased activity levels as CES has come off its fixed cost base.

CES believes that over time it can continue to grow its share of the oilfield consumable chemical markets in which it competes. The Catalyst Acquisition in 2016 was another significant step forward in this regard as CES sees the Permian Basin having the most near-term opportunities for growth. CES' strategy is to utilize its decentralized management model; its vertically integrated manufacturing model; its problem solving through science approach; its patented and proprietary technologies; and its superior execution to increase market share. The downturn has made many middlemen, or competitors who are simply resellers of other company's products, redundant. By being basic in the manufacture of the consumable chemicals it sells, CES continues to be price competitive and a technology leader. Recent competitor consolidations and business failures will provide further opportunities for CES in this recovery period. CES believes that its unique value proposition makes it the premier independent provider of technically advanced consumable chemical solutions to the North American oilfield.

CES will continue to assess M&A opportunities that will improve CES' competitive position and enhance profitability. Any acquisitions must meet CES' stringent financial and operational metrics. In its core businesses, CES will focus on growing market share, controlling costs, developing or acquiring new technologies, and making strategic investments as required to position the business to capitalize on the industry rebound.

CES is a leading provider of technically advanced consumable chemical solutions throughout the life-cycle of the oilfield. This includes total solutions at the drill-bit, at the point of completion and stimulation, at the wellhead and pump-jack, and finally through to the pipeline and midstream market. At the drill-bit, CES' designed drilling fluids encompass the functions of cleaning the hole, stabilizing the rock drilled, controlling subsurface pressures, enhancing drilling rates, and protecting potential production zones while conserving the environment in the surrounding surface and subsurface area. At the point of completion and stimulation, CES' designed chemicals form a critical component of fracturing solutions or other forms of remedial well stimulation techniques. The shift to horizontal drilling and multi-stage fracturing with long horizontal well completions has been responsible for significant growth in the drilling fluids and completion and stimulation chemicals markets. At the wellhead and pump-jack, CES' designed production and specialty chemicals provide down-hole solutions for production and gathering infrastructure to maximize production and reduce costs of equipment maintenance. Key solutions include corrosion inhibitors, demulsifiers, H2S scavengers, paraffin control products, surfactants, scale inhibitors, biocides and other specialty products. Further, specialty chemicals are used throughout the pipeline and midstream industry to aid in hydrocarbon movement and manage transportation and processing challenges including corrosion, wax build-up and H2S.

CES operates in the Western Canadian Sedimentary Basin ("WCSB") and in several basins throughout the United States ("US"), with an emphasis on servicing the ongoing major resource plays. In Canada, CES operates under the trade names Canadian Energy Services, PureChem Services ("PureChem"), StimWrx Energy Services Ltd. ("StimWrx"), Sialco Materials Ltd. ("Sialco"), and Clear Environmental Solutions ("Clear"). In the US, CES operates under the trade names AES Drilling Fluids ("AES"), AES Frac Fluids ("AES Frac"), Superior Weighting Products ("Superior Weighting"), JACAM Chemicals ("JACAM"), and Catalyst Oilfield Services ("Catalyst").

The Canadian Energy Services and AES brands are focused on the design and implementation of drilling fluids systems and completion solutions sold directly to oil and gas producers. The StimWrx brand provides near matrix stimulation and remediation of oil, gas, and injection wells in Western Canada. The Superior Weighting brand custom grinds minerals including barite, which is the weighting agent utilized in most drilling fluid systems. The JACAM, Catalyst, PureChem, and Sialco brands are vertically integrated manufacturers of advanced specialty

chemicals. In addition to being basic in the manufacture of oilfield chemicals, JACAM, Catalyst, and PureChem have expanding distribution channels into the oilfield.

Clear is a complimentary business division that supports the operations and augments the product offerings in the WCSB. Clear is CES' environmental division, providing environmental consulting, water management services, and drilling fluids waste disposal services primarily to oil and gas producers active in the WCSB.

Led by JACAM's state of the art laboratory in Sterling, Kansas, CES now operates eight separate lab facilities across North America: two in Houston, Texas; two in Midland, Texas; and one in each of Carlyle, Saskatchewan; Delta, British Columbia; and Calgary, Alberta. In 2015, CES significantly expanded its laboratory capabilities in Calgary with the opening of its new laboratory and technology center. In the US, CES' main chemical manufacturing and reacting facility is located in Sterling, Kansas with additional low-temperature reacting and chemical blending capabilities in Midland, Texas and chemical blending capabilities in Sonora, Texas. In Canada, CES has a chemical manufacturing and reacting facility located in Delta, British Columbia with additional chemical blending capabilities located in Carlyle, Saskatchewan and Nisku, Alberta. CES also leverages third party partner relationships to drive innovation in the consumable fluids and chemicals business.