Saxon Energy Services to Build Seven Rigs

Saxon Energy Services has entered into contracts to construct and operate seven drilling rigs on a three year term for a major US independent gas producer.

Five of the rigs are advanced technology singles, and the other two rigs are fast-moving telescopic doubles. All rigs are designed and constructed to efficiently drill and mobilize on a multi-well drilling program. The telescopic doubles are projected to commence operations in the fourth quarter of 2006. They are modern carrier style rigs with advanced pipe-handling and reduced inter-well moving time features. The single rigs which will have mutually agreed design specifications feature remote pipe-handling and controlled environment operating capabilities and are scheduled to commence deliveries in early 2007. All of the rigs will be equipped with top-drives.

The rigs will operate in Texas and provide a continuation of the company's focus on growth in expanding its operating presence in North America, and particularly in the Arkansas/Texas region.

Upon completion of these rigs, Saxon will have a total of 15 mobile drilling rigs operating in the region bringing its total rig count in North America to 31 (net 27). With Saxon's existing 29 rigs in South America operating in primarily oil exploration and development projects, these new contracts will achieve a balanced asset allocation in the Americas, as well as an even mix between oil and gas drilling markets.

Saxon is an emerging international oilfield services company operating a well-established oil and gas drilling and well servicing business in Canada, Mexico, Ecuador, Colombia, Venezuela and Peru with a rapidly growing presence in the United States. Saxon focuses on providing services to major and intermediate oil and gas companies and plans to grow revenue by both the consolidation of existing companies operating in its areas of interest and the addition of assets to its existing rig fleet. Saxon's fleet of rigs is currently comprised of 36 (net 32) drilling and 17 workover rigs.