Precision Drilling Corporation · TSX:PD
Precision Drilling — Howard Weil 40th Annual Energy Conference 2012
26 slides from Precision Drilling's conference presentation, Mar 28, 2012
Slide 1: Howard Weil 40th Annual Energy Conference
Howard Weil 40th Annual Energy Conference March 28, 2012
Slide 2: Forward-looking statements
Forward-looking statements Statements that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and forward looking information within the meaning of applicable Canadian legislation. These forward-looking statements are ba
Slide 3: Precision Drilling Corporation Overview
Precision Drilling Corporation Overview • High Performance High Value Service Provider • Marketed fleet of 190 rigs in Canada, 146 rigs in the United States and 6 rigs internationally • Reputation for excellent equipment and personnel • One of the most active drillers in North America • Industry lea
Slide 4: U.S. Rig Count
U.S. Rig Count 2000 1800 1600 Active Oil Rig Count 1400 continues US Active Land Rig Count to rise gaining 1200 market share 1000 800 600 Active Gas 400 Rig Count has rolled over 200 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Active Gas Rigs Active Oil Rigs Source: BHI -4-
Slide 5: Decline in Nat Gas Directed Rig Activity
Decline in Nat Gas Directed Rig Activity Weeks from Peak 0 4 8 12 16 20 24 28 32 36 40 44 48 52 0% US Land Rigs Targeting Gas - Percentage Drop from Peak -10% 2008 - Drop from Pre-recession High -20% 2011 – Current Drop from Pre- Winter High -30% -40% -50% -60% -70% Source: BHI Oct 2011 - present Se
Slide 6: Canadian Rig Activity (Oil/Gas)
Canadian Rig Activity (Oil/Gas) 800 700 600 CANADA Active Land Rig Count 500 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Active Oil Rigs Active Gas Rigs Source: BHI -6-
Slide 7: Canada Rig Activity (5-Year Seasonal)
Canada Rig Activity (5 - Year Seasonal) 800 700 600 Canadian Active Land Rig Count 500 400 300 200 100 0 January February March April May June July August September October NovemberDecember Source: BHI 5 Year Range 2006 - present 2010 Rig Count 2011 Rig Count 2012 Rig Count -7-
Slide 8: Canada / US Active Land Rig Count Targeting Oil
Canada / US Active Land Rig Count Targeting Oil 1800 $160 1600 $140 1400 $120 Land Based Rigs Targeting Oil 1200 $100 WTI (US$/bbl) 1000 $80 800 $60 600 $40 400 200 $20 0 $0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: BHI US Oil Directed CANADA Oil Directed WTI -8-
Slide 9: Superior Value for Customers
Superior Value for Customers Customers Need Reduced Risk Lower Well Costs Safety & Environmental Responsiveness & Flexibility Long-Term Partner People Technology Systems Precision Drilling -9-
Slide 10: High Performance People
High Performance People Superintendent Rig Manager Driller Drilling Rigs (US & Canada) Average experience 18 15 7 (years) TTM Retention 92% 91% 85% Percent Internally 100% 94% 79% Promoted For 2011, 242 Precision drilling rigs and 175 service rigs were incident free. - 10 -
Slide 11: High Performance Rig Fleet
High Performance Rig Fleet HP <1,000 1,000 – 1,500 >1,500 Total Super Series 74 57 17 148 Tier 2 (High 69 35 24 128 Performance) Tier 3 49 13 4 66 Total 192 105 45 342 Precision has announced the planned addition of 35 new build rigs to its fleet in 2012. As of February 28, 2012 - 11 -
Slide 12: Super Single Drilling Rig
Super Single Drilling Rig 1,000 hp – 15,000’ depth Derrick and Range III drill pipe integrated top drive Automated pipe handling system Substructure, integrated draw works, and BOP’s Source: Precision Drilling - 12 -
Slide 13: Super Single Video
Precision i Super Single Video i)
Slide 14: 1200 hp Super Triple Video
1200 hp Super Triple Video - 14 -
Slide 15: ST-1200 Super Triple Drilling Rig On Location
ST-1200 Super Triple Drilling Rig On Location - 15 -
Slide 16: Positioned In Most Active North American Regions
Positioned In Most Active North American Regions Horn River Cardium Bakken Montney Niobrara Viking Marcellus Western Canada Sedimentary Basin Uinta Basin Utica Antrim Green River Basin Fayetteville Woodford San Joaquin Piceance Powder River Basin Basin Mississippian Lime Haynesville Appalachian Barn
Slide 17: Precision North American Land Drilling Activity
Precision North American Land Drilling Activity 300 250 Active Rig Count US & CAN 200 150 Canadian Breakup 100 Canadian Breakup 50 0 Source: Rig Data, Nickles PD Largest Competitor - 17 -
Slide 18: Percentage of Rigs Drilling Directional / Horizontal
Precision High Performance 90% 85% Percentage of Rigs Drilling Directional / 80% 75% 70% Horizontal 65% 60% 55% 50% 45% 40% Q1-09 Q2-09 Q3-09 Q4-09 Q1-10 Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Source: BHI US Industry Active Land Rigs (includes PD) PD US Active Land Rigs 90% Percentage of Di
Slide 19: Completion and Production Service Lines
Completion and Production Service Lines Well Servicing Equipment Rentals Camps & Catering Coiled Tubing - 19 -
Slide 20: Vertically Integrated Operations
Vertically Integrated Operations Manufacturing & Repair Distribution & Supply Nisku, AB Red Deer, AB Picture of Rostel Houston, TX Or Tech Center Picture of Columbia Supply Grey Wolf Supply Drilling Site Margin & Quality Enhancement Drilling Site - 20 -
Slide 21: Growth: Directional and International Drilling
Growth: Directional and International Drilling Directional Drilling International Drilling - 21 -
Slide 22: Historical Income Statement Data
Historical Income Statement Data (a) Annual Revenue Annual EBITDA and Margins $2,000 $1,000 50% 1,951 $1,600 $800 40% 1,438 1,430 695 669 1,197 $1,200 1,102 $600 30% 1,009 435 437 435 407 $800 $400 20% $400 $200 10% $0 $0 0% 2006 2007 2008 2009 2010 2011 2006 2007 2008 2009 2010 2011 (a) Dollar amou
Slide 23: Capital Structure Overview
Capital Structure Overview (Canadian $ in millions) Unaudited 12/31/2011 Cash and Cash Equivalents $ 467 Revolving Credit Facility - Total Sr. Secured Debt - Senior Unsecured C$ Notes due 2019 200 Senior Unsecured US$ Notes due 2020 661 Senior Unsecured US$ Notes due 2021 407 Total Debt (a) 1,268 Bo
Slide 24: Term Contracted Rigs
Term Contracted Rigs 300 Forecasted Contract Actual Contract 250 Actual Avg. Active Rigs 200 150 100 50 0 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 2012 Avg. *Actual represents reported quarterly average. **Forecasted represents reported forecast 2 quarters out. 2012 estimate i
Slide 25: Key Takeaways
Key Takeaways • Unconventional drilling will continue to drive growth opportunities • Precision is uniquely positioned as the most active unconventional driller in North America • 49 new builds announced since January 2011 • Precision drives efficiency, quality and cost control through vertical inte
Slide 26: Precision Drilling Corporation
Precision Drilling Corporation 800, 525-8th Avenue S.W. Calgary, Alberta, Canada T2P 1G1 Telephone: 403.716.4500 Facsimile: 403.264.0251 www.precisiondrilling.com
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