The recovery in oil and gas activity last year, which allowed oilfield services contractors to their losses, still led to many working below capacity and vulnerable to setbacks, according to a Calgary firm.

Western Energy Services Corp., which recently issued its 2021 and fourth quarter results, has 120 drilling and well service rigs combined in Canada and the United States.

“Heightened uncertainty persists,” management said. “The precise duration and extent of the adverse impacts of the current macroeconomic environment and the Covid-19 pandemic…remain highly uncertain.”

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Pipeline politics undermine the Canadian industry, executives...