09/11/2013 03:14 EDT | Updated 11/11/2013 05:12 EST

Total Energy Services ups capital budget by 22 per cent to $95.8 million

CALGARY - Total Energy Services Inc. (TSX:TOT) has raised this year's capital budget by nearly 22 per cent, with the added spending going toward its contract services division, Chinook Drilling.

The Calgary-based company now plans to spend $95.8 million this year, an increase of $17.2 million.

The increased expenditures will include the construction of a new 4,200-metre drilling rig, which is set to be complete by the second quarter of next year.

Total says there's "significant interest" in the new rig and discussions are underway. It expects to finalize contract terms closer to completion.

Once the new rig is built, Total will have 17 rigs in its fleet.

The company plans to finance its capital budget from cash on hand, operating cash flow and, if necessary its $35-million credit facility.

Total shares rose 14 cents to $16.69 in afternoon trading on the Toronto Stock Exchange.