Pioneer Drilling Delivers Its 60th Rig

Pioneer Drilling Company reported that the ninth rig of its 16 rig new-build program has commenced work under a two-year contract in its South Texas division. The rig is a 1000-hp trailer-mounted electric rig designed to be quick-to-move and rig-up, contains modern mud-cleaning equipment and has two independently powered, 1000-hp triplex mud pumps. This rig increases Pioneer's total working fleet to 60 rigs.

Pioneer also announced that it has ordered 70 iron roughnecks and power slips to be delivered over a 24-month period beginning in January 2007, at a cost of approximately $18.3 million, plus installation costs of approximately $3 million. Red West, Pioneer's Executive Vice President and Chief Operating Officer, stated, "Iron roughnecks provide a faster, safer and more efficient method to spin up and spin out drill pipe. In addition, they will greatly reduce costly and dangerous accidents associated with the use of spinning chains and rotary tongs." Pioneer expects to take delivery of six iron roughneck units in the fourth quarter of this fiscal year, ending March 31, 2007, 48 units in fiscal 2008 and 16 units in fiscal 2009. Additionally, Pioneer has ordered two topdrives at a cost of approximately $3.3 million, which are scheduled for delivery in January 2007.

Wm. Stacy Locke, Pioneer Drilling's President and Chief Executive Officer, stated, "We are continuing to invest in building a premium land drilling fleet that we expect will command superior dayrates and remain in demand regardless of market swings. By adding these iron roughnecks to our rigs to handle the drill pipe connections on the drilling floor, one of the more dangerous jobs on the rig, we are reducing the potential for injury and enhancing our ability to be a top safety performer in the industry. High quality and safe operations attract premium customers for Pioneer to partner with over the long term. In addition, we will soon be able to provide topdrive services to our customers who are drilling in more challenging environments."

Pioneer Drilling provides land contract drilling services to independent and major oil and gas operators drilling wells in Texas, Louisiana and Oklahoma, and in the Rocky Mountain region. Its fleet consists of 60 land drilling rigs that drill in depth ranges between 6,000 and 18,000 feet.