Our Mechanical Service Division delivers field maintenance service, equipment and parts to the global oil and gas industry. This division specializes in equipment diagnostics, performance optimization, field maintenance and repair and troubleshooting for all major brands of gas compression, power generation and co-generation equipment.

During the year, Enerflex entered into a distribution and sales agreement for Canada with Altronic Inc., a leading manufacturer of ignition and control systems. The distributorship further establishes this division as a leading provider of top quality parts and services.

Continued strong international and domestic market demand will drive this division forward over the coming year. New product lines and expansion of current product lines, together with superior service, all contribute towards steadily improving results. The Service division will continue to play a key role in our Variable Cost Production initiatives.

The recent acquisition of the assests of Powertec in the Netherlands has substantially increased our footprint and critical mass in that Region. With proforma 2006 revenues of approximately $80 million, we have established our second international Region outside of North America. Powertec adds power systems manufacturing and Combined Heat and Power expertise, strong gas engine aftermarket capability and a significant base of long-term service contract revenue to our existing European operations.

Our Electrical Instrumentation and Controls Division ("EI&C") is one of the largest open shop electrical and instrumentation contractors in western Canada. They provide a comprehensive range of technologies, products and service to industries worldwide. From design to start-up assistance, round-the-clock service, maintenance and system upgrading, this division provides total electrical, instrumentation and controls solutions anywhere in the world. This division has also been recognized as a Safety Leader by the Governments of Alberta and Saskatchewan for its outstanding safety record and initiatives.

By maintaining their focus on customer relationships, developing new offerings, optimizing inventory levels and improving internal processes. EI&C is well positioned for continued growth in 2007.