Key Energy lifts stake in Russian oilfield company

Key Energy lifts stake in Russian oilfield services company GeoStream, can pick most of board

• On 6:31 pm EDT, Thursday September 3, 2009

HOUSTON (AP) -- Key Energy Services Inc. said Thursday it closed the second part of its investment in Russian oilfield services company OOO GeoStream Services Group this week.

The investment completed Tuesday was about $16.2 million and raised its stake in GeoStream to 50 percent from 26 percent.

The company closed its first investment in GeoStream for $17.6 million last October.

Key said it can now appoint a majority of GeoStream's board and will consolidate the Russian company's financial results.

Along with the second investment, GeoStream agreed to buy drilling rigs and other equipment from Key for about $23 million, some of which will be financed by Key.

Key said it also planned to license a technology system and provide technical services to GeoStream.

Houston-based Key provides rigs and services to oil and gas producers in the United States, Argentina and Mexico.

The shares rose 21 cents, or 2.9 percent, to $7.43 on Thursday.