Parker Drilling's Management Presents At 2012 Barclays CEO Energy/Power Conference (Transcript)

Parker Drilling Company (PKD)

Barclay’s CEO Conference Call

September 6, 2012 11:45 am ET


Robert L. Parker Jr. – Executive Chairman, President and Chief Executive Officer

W. Kirk Brassfield – Senior Vice President and Chief Financial Officer


Unidentified Analyst

Okay. Welcome back everyone. Up next we are pleased to welcome back to CEO Energy Conference Parker Drilling. Parker is one of the leading providers of extended-reach-drilling, the global oil field market, and is a company with a leadership position and complex extended-reach-applications in harsh environments. Joining us today and speaking for the company will be Bobby Parker, Parker’s Executive Chairman, President and CEO.

Bobby joined the company in 1973 and has served as Chief Executive Officer from 1991 to 2009, and was appointed Chairman of the Board of Directors in 2006. Please let me welcome back Mr. Robert Parker Jr., to the CEO Energy Conference. Bobby?

Robert L. Parker Jr.

Thank you very much. Glad to be back. And good morning everyone, I appreciate your interest in Parker Drilling Company. Today with me I have Kirk Brassfield, our CFO; and also Rich Bajenski, down here our Director of IR, and then somewhere in the back of the room, back there Marc White, who runs our Rental Tool Division. And I’m glad to have all of you here for the presentation.

I’ll also comment to that our written quotation is available in the back of the room, and I will not be following that today, so take it with you to catch up with other segments of our company that I will not be covering.

I will start off today with forward-looking statement again, just to make sure you’re aware of this, and with our SEC filings, you’re aware of the risk statements and risk identifications that we have in there. I will go from there to quick look at our strategy for our company, obviously you can see across the top line what our strategy is, and then our competitive strength as listed down below is safety, which is primarily one of the strongest suits of our company. Training that ties into safety; technology, the things that we do around the world that we will talk about some, and then performance in terms of our drilling and value that we create for our customer and through our rental tool division, what we’re able to do again for our customers in those areas.

Talk about our business segments, just as a highlight very quickly. We have five business segments with rental tools, which I will talk about U.S. barge drilling business, which is doing very well right now. Our Alaska division is listed under U.S. drilling and I’m going to talk about that today. Our international drilling, I’ll give a quick update there and then technical services. Those are our general business segments that we report on our company and then down below there you can comment on what’s up and what the definition of what those segments are.

I’ll start with just brief update on international. International has still been a weak point for us. International has not recovered since the financial issues in late 2000s. We’re still working on getting the international utilization up, Kazakhstan in area that still is a issue for us, where we have nine rigs located and only two rigs working, and we talked about those selling rigs there and moving rigs out of the country to more active areas, and we’re continuing to pursue both of those but just continue to hamper our international utilization.

Our look forward there, just so that you’re aware of our utilization here for a while. You can see where it’s continuing to be weak and we actually don’t forecast much of improvement, in fact we have to forecast continued weakening into the first quarter next year still be aware of that. We have a new team on marketing they’re charged with turning this issue around addressing this issue.

We’re seeing a record number of tenders coming right now, so we are optimistic on this turning around sometime during 2013 and just as a warning here in the near term that we’re seeing further weakening, but don’t think we’re not addressing the issue but we certainly are through our efforts and through our tenders that we receive and respond to.

Today’s talk is going to be a little different. Outside of international, I’m going to talk about primarily Alaska, our AADU rigs for BP, and the status of those, and then our rental tool starts, a rental tool company, where we are there with the U.S. land drilling business.

So we’ll start with Alaska. The AADU Prudhoe Bay rigs for BP, there is a picture of them right taken last Tuesday upon the slope, and showed you what status there or what they look like right now in our yard, these rigs are still in rig up, and I’m going to cover that.

First, I want to make sure people are aware of where we’re talking about, so we’re going to go to Alaska here with the slide, and talk about Prudhoe Bay, which is the northern of the slope there shown in the orange color. The pipeline runs right up through there, and these rigs are really targeted for the main Prudhoe Bay operation for the BP side of the field, ConocoPhillips operates the other side of the field, this is oil, this is planned long-term drilling, so these rigs will have a lot of drilling to do once they get in the field and start working.

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