Pioneer Drilling Co. (PDC)
UBS Global Oil & Gas Conference
May 24, 2012 12:20 pm ET
Stacy Locke- President and Chief Executive Officer
Angie Sedita - UBS Securities
Angie Sedita - UBS Securities
Previous Statements by PDC
» Pioneer Drilling's CEO Discusses Q1 2012 Results - Earnings Call Transcript
» Pioneer Drilling's CEO Discusses Q4 2011 Results - Earnings Call Transcript
» Pioneer Drilling's CEO Discusses at Bank of America Merrill Lynch Global Energy - Conference Call Transcript
We are very pleased to have Pioneer Drilling here as our next presenter, Stacy Locke, who is the President and Chief Executive Officer of Pioneer Drilling. Stacy has served as President and CEO since December 2003. Prior to that he served as President and CFO from 2000 to 2003, and had been the President and COO from 1998 to 2000. He also actually started his career at investment banking. Stacey has been actually one of my favorite COOs and we give him even more credit this morning given the fact that he did see spasmodic last night, so here it goes.
Thank you, Angie. I do feel a little spasmodic today, but anyway I appreciate you all being here. Let's move this slide along. I must be pushing the wrong button. There we go. Okay. There we go.
Pioneer Drilling, pretty simple story, really. We are in four primary business lines. The top three identified here are part of our production services group. That group is headed up by a distinguished gentleman, Mr. Joe Eustace, over here. He is President of our Production Services group. Joe has been in the industry for about 30 years, started Dawson Wells service back in 1982, so he has been around the industry very, very long time.
Sitting next to Joe is, Joe Freeman who runs our Well Services division, which as I have said to many people over the years, I think Joe is probably one of the best well service operators in the United States today. He has done an outstanding job and you will see a little more of that as we go through the presentation.
Then on the bottom, is our Pioneer Drilling segment, but if you look where we sit today in these four core businesses, we are at 98 well service rigs presently. We will end the year at about 108. We are 112 wireline. Most of those are cased-hole wireline units. Today, we will end the year at 119. We have 10 coiled tubing units and we will end the year at 13 there. Drilling rigs, 62 today, and we will end the year about 69 or 70, and then we have got a total of 10 new builds under construction, but we will deliver about seven or eight this calendar year.
Geographically, we are kind of spread in all of the places you might think we should be in, mostly the shale plays around the United States. One of our tube, I guess the tube core areas for us are the Bakken Shale up in North Dakota, and leaning over in to Montana, and the Eagle Ford Shale, which is right in our backyard and then we are headquartered in San Antonio, and so we have got a lot of our services in both of those plays and then we have our presence in the Marcellus and the Haynesville, the Permian, the Rockies, and then Louisiana on-shore and offshore and then down in the country of Colombia. We have been there since '07, just in drilling.
A few points that I would like to make. We basically got the businesses that we feel are the most important for Pioneer to own, and with these four core businesses, where we can drill the original bore hole with drilling most of which are horizontal these days and the shale plays and then the verticals in the Permian.
So we drill the original bore hole with drilling. We come in after that with either a well service unit and do some maintenance work or do some completion work on it and/or we come in with our wireline units and perforate to do the multi-stage fracs.
We don't do the fracking, we do the perforating and the plug setting in all of these key shale plays, and then when the perforations are there and all the stages are complete and have been fracked, our cased-hole moves off. We come on with our well service rig in some cases and drill up the plugs and run tubing and set the well on production, or in other cases we will come in with our coal tubing unit and drill out the plugs and then come in with our well servicing rig. Nonetheless, we drill the original bore hole and then we set the well up on production after running the production string of tubing.
That's kind of the completion side of our business, and then for the life of these boreholes, which are growing rapidly in number across the country in these shale plays, we will service that bore hole with all of these production service businesses. So that has really been our strategy is to do that start-to-finish on the completion side and then be able to service that bore hole with these services for the life them.
We have grown at pretty clip over the last couple of years. 47% revenue growth in '11. 40% projected for this year. We should end the year at about $1 billion in revenues for the first time.
You probably heard a lot of talk about his bifurcated rig market. Well, I am actually going to talk about a different sort of bifurcated rig market and it's one that creates a great opportunity for those of us that have high end mechanical rigs and I will talk about that more in just a second.