Unit Corp. Acquires Service Drilling Company

Unit Corporation has signed an agreement to acquire Serdrilco Incorporated and its subsidiary, Service Drilling Southwest LLC, a U.S. land drilling company located in Borger, Texas, for $35,000,000 in cash and an earn-out provision allowing the sellers to obtain one-half of the cash flow in excess of $10 million for each of the next three years. The acquisition includes 12 mechanical rigs, a 12-truck moving fleet, along with inventory and other equipment. The transaction is expected to close on or about December 8, 2003.

Serdrilco, a private, Tulsa-based drilling company, has been operating in the Anadarko Basin in the Texas Panhandle for more than 50 years. All 12 of the rigs are currently under contract. The rigs range from 650 horsepower to 1,000 horsepower with depth capacities rated from 6,500 feet to 18,000 feet. In addition to the rigs, Unit will acquire a fleet of 12 trucks that enable the efficient movement of rigs to new drilling locations and a district office and equipment yard in and near Borger, Texas.

John G. Nikkel, Chairman and Chief Executive Officer of Unit Corporation said, "These assets complement our existing operations and expands a current market area for Unit. Service Drilling Company is a respected drilling contractor in the Texas Panhandle with an established client base, an efficient operation and experienced crews. Given the declining inventory of rigs available for acquisition, we are pleased to be adding these assets to our fleet. Along with an additional rig that was built and recently placed into service, our rig fleet will total 88 land drilling rigs at the close of this acquisition."