Unit Corporation Acquires Sauer Drilling Company

Unit Corporation has signed an agreement to acquire Sauer Drilling Company, a Casper-based drilling company and a wholly-owned subsidiary of Tom Brown, Inc., for $34.7 million in cash and an amount equal to Sauer's working capital at closing. The acquisition includes 9 drilling rigs, a fleet of trucks, and an equipment and repair yard with associated inventory, located in Casper, Wyoming. The transaction is expected to close on or about July 30, 2004.

Sauer Drilling Company and its predecessors have been operating in the Rocky Mountains for more than 25 years, with the last six years as a subsidiary of Tom Brown, Inc., which is now an indirect wholly owned subsidiary of EnCana Corporation. Of the 9 rigs, 8 are currently operating under contract in the Wind River Basin in Wyoming and the Paradox Basin in Colorado. The rigs range from 500 horsepower to 1,000 horsepower with depth capacities rated from 5,000 feet to 16,000 feet. In addition to the rigs, Unit will acquire a fleet of 4 vacuum trucks and 11 rig-up trucks that enable the quick and efficient movement of rigs to new drilling locations. The trucks also have the capacity to move third-party rigs. The equipment yard, located in Casper, Wyoming, will provide service space for the nine newly acquired rigs and trucks and our existing Rocky Mountain fleet.

John G. Nikkel, Chairman and Chief Executive Officer of Unit Corporation said, "This acquisition will expand our operations in the Rocky Mountains where we currently have 10 rigs operating and will be immediately accretive to both earnings and cash flow per share. Sauer Drilling Company is a respected drilling contractor in the Rocky Mountains, and we are pleased to be adding these assets to our fleet. Demand for our rigs continues to remain very strong. We currently have 85 of our 91 rigs operating. At the close of this acquisition, our rig fleet will total 100 land drilling rigs. Of the 100 rigs, 97 are contracted and the remainder have strong expressions of intent."

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