Nabors' Second Quarter EPS Equals $0.19 Ex-Items of ($0.04) on Operating
Income of $125 Million.


    


    
</pre>
<p>HAMILTON, <span class="xn-location">Bermuda</span>, <span class="xn-chron">July 27</span> /CNW/ -- Nabors Industries Ltd. (NYSE:   NBR) today announced its financial results for the second quarter and first six months of 2010.  The Company posted adjusted income derived from operating activities of <span class="xn-money">$124.9 million</span> for the current quarter, which compares to <span class="xn-money">$143.9 million</span> in the second quarter of last year when certain non-cash items are excluded, and <span class="xn-money">$138.5 million</span> in the first quarter of this year.  Net Income was <span class="xn-money">$43.6 million</span> or <span class="xn-money">$0.15</span> per diluted share, but when adjusted to exclude <span class="xn-money">$12.2 million</span> in non-operational items, net income was <span class="xn-money">$55.9 million</span> (<span class="xn-money">$0.19</span> per diluted share).  This compares to <span class="xn-money">$90.9 million</span> (<span class="xn-money">$0.32</span> per diluted share) in the second quarter of last year and <span class="xn-money">$40.2 million</span> (<span class="xn-money">$0.14</span> per diluted share) in the first quarter of this year.  Operating revenues and earnings from unconsolidated affiliates totaled <span class="xn-money">$915.3 million</span> in the current quarter compared to <span class="xn-money">$868.0 million</span> in the second quarter of last year and <span class="xn-money">$905.7 million</span> in the first quarter of this year.  For the six months ended <span class="xn-chron">June 30, 2010</span> adjusted income derived from operating activities was <span class="xn-money">$263.4 million</span> compared to <span class="xn-money">$417.9 million</span> in the first six months of 2009.  Net income for the first six months of 2010 was <span class="xn-money">$83.8 million</span> (<span class="xn-money">$0.29</span> per diluted share) which included <span class="xn-money">$33.4 million</span>, or <span class="xn-money">$0.11</span> in similar non-operational items as previously discussed.  Operating revenues and earnings from unconsolidated affiliates for the first six months of 2010 totaled <span class="xn-money">$1.82 billion</span>, compared to <span class="xn-money">$2.1 billion</span> for the first six months of 2009.</p>
<p/>
<p><span class="xn-person">Gene Isenberg</span>, Nabors' Chairman and CEO, commented, "I believe the second quarter marks the start of a steady upward progression in our business.  Operating income was slightly lower than the first quarter as improving rig activity in our International and US Land Drilling units along with strong third-party sales in Canrig essentially offset seasonal downturns in <span class="xn-location">Canada</span> and Alaska and <span class="xn-money">$2 million</span> in lost income in our US Offshore business due to the suspended operations in the Gulf of <span class="xn-location">Mexico</span>.</p>
<p/>
<p>"Net income was impacted by certain non-operational items amounting to approximately <span class="xn-money">$12.2 million</span>, or <span class="xn-money">$0.04</span> per share.  These items consisted of <span class="xn-money">$4.8 million</span> in foreign exchange losses; <span class="xn-money">$3.6 million</span> in book losses on <span class="xn-money">$171 million</span> in additional purchases of our convertible notes due <span class="xn-chron">May 2011</span>; <span class="xn-money">$2.2 million</span> in tax adjustments internationally; a net reduction of <span class="xn-money">$0.5 million</span> in the carrying value of various equity holdings; and the elimination of <span class="xn-money">$1.1 million</span> in rig income derived from our oil and gas joint venture operations.</p>
<p/>
<p>"Our US Lower 48 Land Drilling unit posted good results driven by a 14 rig increase in our quarterly average rig count.  Our second quarter average rig count was 172.3 with a current count of 179 that includes four idle rigs receiving termination revenue.  Despite this sharp increase in activity operating income was essentially flat, primarily attributable to the <span class="xn-money">$14.1 million</span> (<span class="xn-money">$988</span> per rig day) reduction in contract termination income compared to the first quarter.  This reduction, combined with higher labor and other operating costs, more than offsets the higher rig count as well as an increase in average dayrates of approximately <span class="xn-money">$1,100</span> per rig day.   We expect the balance of the year will still achieve increases in rig count and rates, but at a more modest pace.  Leading edge rates for our PACE® and SCR rigs continue to improve significantly across all of our markets, with the less capable rigs improving only modestly.</p>
<p/>
<p>"During the quarter we received additional long-term awards for five new PACE® rigs and three substantially upgraded SCR rigs.  We now have 12 committed rigs under construction, including the four secured last quarter.  We expect to secure at least five more new rig commitments in the near future, and we continue to receive inquiries regarding incremental PACE® and upgraded SCR rigs. Market demand continues to validate the benefits of AC rig technology, which can be approximated on our SCR rigs when we incorporate our proprietary K-BOX® and ROCKIT(TM) systems.  Virtually all of these rigs are deploying into the shale plays where we continue to enjoy the largest market share.  Of our 179 rigs working today, 82 are working on oil or liquids-rich wells, a market where we also enjoy the largest market share.  Fewer than 20 of the remaining rigs are deployed on conventional gas projects, which are generally subject to term contracts, with the balance working in shale gas plays.  We continue to expand in key areas, including the Bakken and Eagle Ford and most recently the Marcellus where we have commitments for 10 additional rigs to be deployed over the next year.</p>
<p/>
<p>"Internationally, operating income increased to <span class="xn-money">$65 million</span> from the first quarter low point of <span class="xn-money">$53.6 million</span> as our rig count increased to 98 rigs compared to the 88 rigs working in the first quarter and the low of 84 rigs last November.  Our rig count now stands at 100 rigs, and we expect continual quarterly increases through 2011.  The ongoing deferrals of rig startups in <span class="xn-location">Mexico</span> and the more competitive environment in the <span class="xn-location">Middle East</span> have tempered our expectations as to the pace of recovery in the second half of this year.  Consequently, we now expect this unit's full-year operating income to be on the order of <span class="xn-money">$260 million</span>, with virtually the entire decrease from last year attributable to lower results in our Mexican and Saudi Arabian operations.  Despite progressing slower than we previously indicated, we believe there is good visibility of steady growth, with unexpected rig shutdowns abating and more than 20 rig start-ups scheduled through late 2011.  Eight of these rigs commenced in the second quarter and will contribute more fully throughout the balance of the year.</p>
<p/>
<p>"In our US Land Well Servicing unit, results declined to <span class="xn-money">$3.2 million</span> as increased rig hours were more than offset by extraordinary expenses specific to this quarter.  To meet rising demand we incurred significant costs refurbishing additional rigs, along with the higher overtime and wage increases necessary to staff increasing levels of activity in a tight market for experienced labor.  Compared to the first quarter, activity increased from 148,000 to 157,000 hours at flat rates, with similar increases in trucking activity although with improving rates.  In July, we implemented price increases of up to 10 percent in certain markets.  Industry pricing is improving as we lead in implementing price increases in some areas and follow in others.  With rig hours continuing to increase, we anticipate further rate progression, which should serve to more than offset the recent cost variances and return this unit to robust sequential growth.</p>
<p/>
<p>"Our US Offshore unit's growth trajectory was curtailed by the lingering effects of the recent events in the Gulf of <span class="xn-location">Mexico</span>.  We estimate the impact on our business reduced second quarter operating income by approximately <span class="xn-money">$2 million</span>, limiting it to <span class="xn-money">$8.1 million</span> for the quarter.  Operations on all but two of our six deepwater rigs were suspended and the remaining two rigs will likely cease operations soon.  Another five shallower water operations are also being affected sporadically due to permitting delays and uncertainty which, along with the onset of hurricane season, is also inhibiting the commencement of numerous other projects, although political pressure is building to ease some of the obstacles.  Consequently, we expect operating income for the second half to be reduced by over <span class="xn-money">$25 million</span>, with the potential for a modest loss in the third quarter.  We are optimistic that the majority of these issues will begin to resolve in the fourth quarter and lead to an improved 2011 outlook.</p>
<p/>
<p>"Our Canadian operations posted a loss of <span class="xn-money">$9.5 million</span> during the seasonally weak second quarter.  This result was slightly better than we anticipated due to improved rig activity with an average of 18 drilling and 50 well-servicing rigs operating during the quarter.  We expect this trend to continue with significant increases in rig activity in the second half leading to a full-year result on the order of <span class="xn-money">$12 million</span>.  This improvement compares favorably to last year's net loss, but is still well below the <span class="xn-money">$180 million</span> historical peak in this unit. This unit also has three new built PACE® rigs under construction that will deploy next winter and further improve prospective 2011 results.</p>
<p/>
<p>"Alaskan results were down only slightly at <span class="xn-money">$12.4 million</span> as the winding down of the winter exploration season resulted in less rig activity.  The full-year outlook continues to be 40% lower than last year, and our outlook for 2011 has also diminished with a softening market exacerbated by the introduction of three new competitor rigs that will deliver in late 2010 and 2011 to begin long-term contracts.  BP constitutes well over 50% of the rig demand in Alaska and their curtailment of discretionary spending is further reducing rig requirements.  Other short-term prospects have emerged, but won't be quantifiable until later in the year.  We believe our coiled tubing rig is still the best rig in the market and we expect to secure commitments for additional units next year.</p>
<p/>
<p>"Our Other Operating Segments posted <span class="xn-money">$8.3 million</span> in operating income representing a 21 percent sequential increase primarily attributable to increased third-party sales in Canrig, which more than offset the second quarter seasonal slowdown in our Alaskan joint venture trucking operations and Ryan's Canadian business.  The second-half outlook for Canrig remains very promising with further increases in its third-party top drive and other equipment sales and the increasing acceptance of its Rockit directional drilling technology.  New innovative products like the SUREGRIP(TM) casing running tool are expected to contribute meaningfully in 2011.</p>
<p/>
<p>"Oil and Gas results were modestly positive although weak gas prices persist.  We continue to focus on monetizing certain assets with the sale of our Colombian properties most likely to occur first, potentially later this year.  We continue to explore the possibility of an initial public offering of our NFR joint venture, perhaps as early as the first half of 2011, and we recently engaged an investment banking firm with intimate knowledge of the Horn River region and the highest familiarity with interested Asian buyers to evaluate alternatives for our holdings there.</p>
<p/>
<p>"Our financial position remains solid, with <span class="xn-money">$987 million</span> in cash and other long-term investments.  We still plan to establish a revolving credit facility before the end of this year, and we continue to opportunistically buy our convertible debt due <span class="xn-chron">May 2011</span>.  As of <span class="xn-chron">June 30, 2010</span>, the outstanding face value of these notes was <span class="xn-money">$1.4 billion</span> reflecting <span class="xn-money">$171 million</span> in purchases in the second quarter at an average yield to maturity of over 2.5% compared to the 20 basis points we are earning on our short-term portfolio.  Following redemption we expect our debt-to-EBITDA ratio to approach 2.0.  Opportunities to deploy capital at good returns continue to emerge and we have sufficient resources and access to low-cost capital if needed to fund new rigs and any attractive acquisitions that may arise.</p>
<p/>
<p>"In summary, we are confident we have turned the corner and we are increasingly optimistic regarding steady and meaningful progress in our consolidated income throughout the balance of this year and in 2011.  However, predicting the precise pace of this growth is more problematic.  The last two years have been fraught with challenges including the weak gas price environment, the financial crisis, the economic downturn and most recently the events in the Gulf of <span class="xn-location">Mexico</span>, with all of them exerting adverse effects on our businesses.  Nonetheless, we not only fared better than we expected internally, but we have been able to seize opportunities to enhance our business."</p>
<p/>
<p>The Nabors companies own and operate approximately 550 land drilling and approximately 728 land workover and well-servicing rigs in <span class="xn-location">North America</span>.  Nabors' actively marketed offshore fleet consists of 39 platform rigs, 13 jackup units and 3 barge rigs in the <span class="xn-location">United States</span> and multiple international markets. In addition, Nabors manufactures top drives and drilling instrumentation systems and provides comprehensive oilfield hauling, engineering, civil construction, logistics and facilities maintenance, and project management services. Nabors participates in most of the significant oil and gas markets in the world.</p>
<p/>
<p>The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such forward-looking statements are subject to certain risks and uncertainties, as disclosed by Nabors from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, Nabors' actual results may differ materially from those indicated or implied by such forward-looking statements.</p>
<p/>
<p>For further information, please contact Dennis A. Smith, Director of Corporate Development for Nabors Corporate Services, Inc., at 281-775-8038. To request Investor Materials, contact our corporate headquarters in Hamilton, <span class="xn-location">Bermuda</span> at 441-292-1510 or via email at <a href="mailto:mark.andrews@nabors.com">mark.andrews@nabors.com</a>.</p>
<p/>
<p> </p>
<p> </p>
<pre>
    
                                NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                                CONSOLIDATED STATEMENTS OF INCOME (LOSS)
                                              (Unaudited)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                  Three Months Ended
                                                  ------------------
                                              June 30,              March 31,
                                              --------              ---------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except per
     share amounts)                      2010            2009          2010
                                         ----            ----          ----
    
</pre>
<p> </p>
<pre>
    
    Revenues and other income:
       Operating revenues            $905,058        $867,869      $902,049
       Earnings (losses) from
        unconsolidated affiliates
        (1)                            10,218          (8,127)        3,661
       Investment income (loss)         2,525          18,248        (2,360)
          Total revenues and other
           income                     917,801         877,990       903,350
                                      -------         -------       -------
    
</pre>
<p> </p>
<pre>
    
    Costs and other deductions:
       Direct costs                   524,240         453,922       512,402
       General and administrative
        expenses                       80,996         163,808        75,823
       Depreciation and amortization  176,201         165,974       172,274
       Depletion                        8,922           2,590         6,755
       Interest expense                65,226          66,027        66,745
       Losses (gains) on sales and
        retirements of
         long-lived assets and other
          expense (income), net        10,952           6,689        20,309
       Impairments and other charges
        (2)                                 -         227,083             -
          Total costs and other
           deductions                 866,537       1,086,093       854,308
                                      -------       ---------       -------
    
</pre>
<p> </p>
<pre>
    
    Income (loss) before income
     taxes                             51,264        (208,103)       49,042
                                       ------        --------        ------
    
</pre>
<p> </p>
<pre>
    
    Income tax expense (benefit):
       Current                         17,652         (43,425)       12,645
       Deferred                        (9,450)         28,528        (2,701)
    Income tax expense (benefit)        8,202         (14,897)        9,944
                                        -----         -------         -----
    
</pre>
<p> </p>
<pre>
    
    Net income (loss)                  43,062        (193,206)       39,098
         Less: Net loss attributable
          to noncontrolling interest      559             220         1,102
    Net income (loss)
     attributable to Nabors           $43,621       $(192,986)      $40,200
                                      -------       ---------       -------
    
</pre>
<p> </p>
<pre>
    
    Earnings (losses) per share:
     (3)
      Basic                              $.15           $(.68)         $.14
      Diluted                            $.15           $(.68)         $.14
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Weighted-average number
       of common shares outstanding:
        (3)
       Basic                          285,181         283,154       284,672
                                      -------         -------       -------
       Diluted                        289,796         283,154       290,736
                                      -------         -------       -------
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Adjusted income (loss)
     derived from operating
     activities (1) (4)              $124,917         $73,448      $138,456
                                     ========         =======      ========
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                     Six Months Ended
                                                     ----------------
                                                         June 30,
                                                         --------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except per share amounts)         2010            2009
                                                     ----            ----
    
</pre>
<p> </p>
<pre>
    
    Revenues and other income:
       Operating revenues                      $1,807,107      $2,065,914
       Earnings (losses) from unconsolidated
        affiliates (1)                             13,879         (72,554)
       Investment income (loss)                       165          27,389
          Total revenues and other income       1,821,151       2,020,749
                                                ---------       ---------
    
</pre>
<p> </p>
<pre>
    
    Costs and other deductions:
       Direct costs                             1,036,642       1,119,209
       General and administrative expenses        156,819         271,151
       Depreciation and amortization              348,475         325,126
       Depletion                                   15,677           5,343
       Interest expense                           131,971         133,105
       Losses (gains) on sales and retirements
        of
         long-lived assets and other expense
          (income), net                            31,261          (9,557)
       Impairments and other charges (2)                -         227,083
          Total costs and other deductions      1,720,845       2,071,460
                                                ---------       ---------
    
</pre>
<p> </p>
<pre>
    
    Income (loss) before income taxes             100,306         (50,711)
                                                  -------         -------
    
</pre>
<p> </p>
<pre>
    
    Income tax expense (benefit):
       Current                                     30,297           6,032
       Deferred                                   (12,151)         12,344
    Income tax expense (benefit)                   18,146          18,376
                                                   ------          ------
    
</pre>
<p> </p>
<pre>
    
    Net income (loss)                              82,160         (69,087)
         Less: Net loss attributable to
          noncontrolling interest                   1,661           1,271
    Net income (loss) attributable to Nabors      $83,821        $(67,816)
                                                  -------        --------
    
</pre>
<p> </p>
<pre>
    
    Earnings (losses) per share: (3)
      Basic                                          $.29           $(.24)
      Diluted                                        $.29           $(.24)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Weighted-average number
       of common shares outstanding: (3)
       Basic                                      284,927         283,126
                                                  -------         -------
       Diluted                                    290,266         283,126
                                                  -------         -------
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Adjusted income (loss) derived from
     operating activities (1) (4)                $263,373        $272,531
                                                 ========        ========
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    (1)  Included our proportionate share of full-cost ceiling test
    writedowns recorded by our oil and gas joint ventures of $(75.0)
    million for the six months ended June 30, 2009.
    
</pre>
<p> </p>
<pre>
    
    (2)  Represents impairments and other charges recorded for the three
    months ended June 30, 2009.
    
</pre>
<p> </p>
<pre>
    
    (3)  See "Computation of Earnings (Losses) Per Share" included herein
    as a separate schedule.
    
</pre>
<p> </p>
<pre>
    
    (4)  Adjusted income (loss) derived from operating activities is
    computed by: subtracting direct costs, general and administrative
    expenses, depreciation and amortization, and depletion expense from
    Operating revenues and then adding Earnings (losses) from
    unconsolidated affiliates.  These amounts should not be used as a
    substitute to those amounts reported under accounting principles
    generally accepted in the United States of America ("GAAP").
    However, management evaluates the performance of our business units
    and the consolidated company based on several criteria, including
    adjusted income (loss) derived from operating activities, because it
    believes that these financial measures are an accurate reflection of
    the ongoing profitability of our Company.  A reconciliation of this
    non-GAAP measure to income (loss) before income taxes, which is a
    GAAP measure, is provided within the  table set forth immediately
    following the heading "Segment Reporting".



    
</pre>
<p> </p>
<p> </p>
<pre>
    
                     NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                                
                                          June 30,   March 31, December 31,
    (In thousands, except ratios)           2010        2010        2009
                                            ----        ----        ----
    
</pre>
<p> </p>
<pre>
    
    ASSETS
    Current assets:
    Cash and short-term investments      $892,876  $1,061,014  $1,090,851
    Accounts receivable, net              762,589     735,432     724,040
    Other current assets                  369,943     358,255     361,773
                                          -------     -------     -------
         Total current assets           2,025,408   2,154,701   2,176,664
    Long-term investments and other
     receivables                           93,965      99,195     100,882
    Property, plant and equipment,
     net                                7,641,563   7,646,608   7,646,050
    Goodwill                              164,078     164,756     164,265
    Investment in unconsolidated
     affiliates                           321,293     307,044     306,608
    Other long-term assets                253,834     252,421     250,221
         Total assets                 $10,500,141 $10,624,725 $10,644,690
                                      =========== =========== ===========
    
</pre>
<p> </p>
<pre>
    
    LIABILITIES AND EQUITY
    Current liabilities:
    Current portion of long-term debt  $1,345,819        $209        $163
    Other current liabilities             642,263     579,075     608,459
                                          -------     -------     -------
         Total current liabilities      1,988,082     579,284     608,622
    Long-term debt                      2,364,703   3,855,897   3,940,605
    Other long-term liabilities           918,947     930,861     913,484
                                          -------     -------     -------
         Total liabilities              5,271,732   5,366,042   5,462,711
    Equity:
    Shareholders' equity                5,216,308   5,245,031   5,167,656
    Noncontrolling interest                12,101      13,652      14,323
                                           ------      ------      ------
         Total equity                   5,228,409   5,258,683   5,181,979
         Total liabilities and equity $10,500,141 $10,624,725 $10,644,690
                                      =========== =========== ===========
    
</pre>
<p> </p>
<p> </p>
<p> </p>
<pre>
    
    Cash, short-term and long-term
     investments (1)                     $986,841  $1,160,209  $1,191,733
    
</pre>
<p> </p>
<pre>
    
    Funded debt to capital ratio: (2)
        - Gross                          0.39 : 1    0.40 : 1    0.41 : 1
        - Net of cash and investments    0.32 : 1    0.32 : 1    0.33 : 1
    Interest coverage ratio: (3)          5.9 : 1     5.5 : 1     6.2 : 1
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    (1)  The June 30, 2010, March 31, 2010 and December 31, 2009 amounts
    included $86.6 million, $91.4 million and $92.5 million,
    respectively, in oil and gas financing receivables that were
    included in long-term investments and other receivables.
    
</pre>
<p> </p>
<pre>
    
    (2)  The gross funded debt to capital ratio is calculated by dividing
    * funded debt by (y) funded debt plus deferred tax liabilities
    (net of deferred tax assets) plus capital. Funded debt is the sum of
    (1) short-term borrowings, (2) the current portion of long-term
    debt and (3) long-term debt.  Capital is shareholders' equity.  The
    net funded debt to capital ratio is calculated by dividing * net
    funded debt by (y) net funded debt plus deferred tax liabilities
    (net of deferred tax assets) plus capital.  Net funded debt is
    funded debt minus the sum of cash and cash equivalents and short-
    term and long-term investments and other receivables.  Both of
    these ratios are used to calculate a company's leverage in relation
    to its capital.  Neither ratio measures operating performance or
    liquidity as defined by GAAP and, therefore, may not be comparable
    to similarly titled measures presented by other companies.
    
</pre>
<p> </p>
<pre>
    
    (3)  The interest coverage ratio is a trailing 12-month quotient of
    the sum of net income (loss) attributable to Nabors, interest
    expense, depreciation and amortization, depletion expense,
    impairments and other charges, income tax expense (benefit) and our
    proportionate share of writedowns from our unconsolidated oil and
    gas joint ventures less investment income (loss) divided by cash
    interest expense. This ratio is a method for calculating the amount
    of operating cash flows available to cover cash interest expense.
    The interest coverage ratio is not a measure of operating
    performance or liquidity defined by GAAP and may not be comparable
    to similarly titled measures presented by other companies.



    
</pre>
<p> </p>
<p> </p>
<pre>
    
                               NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                                          SEGMENT REPORTING
                                             (Unaudited)
    
</pre>
<p> </p>
<pre>
    
    The following tables set forth certain information with respect to
    our reportable segments and rig activity:
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                 Three Months Ended
                                                 ------------------
                                                   June 30,         March 31,
                                                   --------         ---------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except rig
     activity)                               2010            2009      2010
                                             ----            ----      ----
    
</pre>
<p> </p>
<pre>
    
    Reportable segments:
    Operating revenues and Earnings
     (losses) from
      unconsolidated affiliates:
        Contract Drilling: (1)
          U.S. Lower 48 Land Drilling     $303,417        $249,859  $271,497
          U.S. Land Well-servicing         104,860         100,080    97,991
          U.S. Offshore                     38,978          41,947    38,198
          Alaska                            43,385          53,207    49,794
          Canada                            60,759          45,651   115,556
          International                    267,007         327,551   245,344
           Subtotal Contract Drilling (2)  818,406         818,295   818,380
    
</pre>
<p> </p>
<pre>
    
        Oil and Gas (3)                     20,202          (6,001)   17,324
        Other Operating Segments (4) (5)   107,749         104,931    95,513
        Other reconciling items (6)        (31,081)        (57,483)  (25,507)
          Total                           $915,276        $859,742  $905,710
                                          ========        ========  ========
    
</pre>
<p> </p>
<pre>
    
    Adjusted income (loss) derived
     from
      operating activities:
        Contract Drilling: (1)
          U.S. Lower 48 Land Drilling      $58,169         $70,075   $60,286
          U.S. Land Well-servicing           3,231           6,192     7,185
          U.S. Offshore                      8,104           6,724     7,373
          Alaska                            12,388          16,374    13,957
          Canada                            (9,497)        (10,538)   14,882
          International                     64,972         101,303    53,579
                                            ------         -------    ------
           Subtotal Contract Drilling (2)  137,367         190,130   157,262
    
</pre>
<p> </p>
<pre>
    
        Oil and Gas (3)                        147         (15,228)     (727)
        Other Operating Segments (4) (5)     8,317           5,321     6,890
        Other reconciling items (7)        (20,914)       (106,775)  (24,969)
                                           -------        --------   -------
          Total                            124,917          73,448   138,456
    Interest expense                       (65,226)        (66,027)  (66,745)
    Investment income (loss)                 2,525          18,248    (2,360)
    (Losses) gains on sales and
     retirements of
       long-lived assets and other
        (expense) income, net              (10,952)         (6,689)  (20,309)
    Impairments and other charges (8)            -        (227,083)        -
    Income (loss) before income taxes      $51,264       $(208,103)  $49,042
                                           =======       =========   =======
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Rig activity:
    Rig years: (9)
       U.S. Lower 48 Land Drilling           172.3           142.9     158.6
       U.S. Offshore                          11.0            12.2      12.0
       Alaska                                  8.0            11.3       9.1
       Canada                                 17.7            11.1      34.8
       International (10)                     97.6           104.1      88.3
          Total rig years                    306.6           281.6     302.8
                                             =====           =====     =====
    Rig hours: (11)
       U.S. Land Well-servicing            157,199         142,797   148,347
       Canada Well-servicing                32,211          23,896    46,032
                                            ------          ------    ------
          Total rig hours                  189,410         166,693   194,379
                                           =======         =======   =======
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                        Six Months Ended
                                                        ----------------
                                                            June 30,
                                                            --------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except rig
     activity)                                        2010             2009
                                                      ----             ----
    
</pre>
<p> </p>
<pre>
    
    Reportable segments:
    Operating revenues and Earnings
     (losses) from
      unconsolidated affiliates:
        Contract Drilling: (1)
          U.S. Lower 48 Land Drilling             $574,914         $639,738
          U.S. Land Well-servicing                 202,851          234,442
          U.S. Offshore                             77,176          102,339
          Alaska                                    93,179          115,989
          Canada                                   176,315          159,245
          International                            512,351          670,207
           Subtotal Contract Drilling (2)        1,636,786        1,921,960
    
</pre>
<p> </p>
<pre>
    
        Oil and Gas (3)                             37,526          (66,045)
        Other Operating Segments (4) (5)           203,262          260,399
        Other reconciling items (6)                (56,588)        (122,954)
          Total                                 $1,820,986       $1,993,360
                                                ==========       ==========
    
</pre>
<p> </p>
<pre>
    
    Adjusted income (loss) derived
     from
      operating activities:
        Contract Drilling: (1)
          U.S. Lower 48 Land Drilling             $118,455         $199,317
          U.S. Land Well-servicing                  10,416           19,850
          U.S. Offshore                             15,477           23,554
          Alaska                                    26,345           37,199
          Canada                                     5,385            2,797
          International                            118,551          204,278
                                                   -------          -------
           Subtotal Contract Drilling (2)          294,629          486,995
    
</pre>
<p> </p>
<pre>
    
        Oil and Gas (3)                               (580)         (86,562)
        Other Operating Segments (4) (5)            15,207           24,275
        Other reconciling items (7)                (45,883)        (152,177)
                                                   -------         --------
          Total                                    263,373          272,531
    Interest expense                              (131,971)        (133,105)
    Investment income (loss)                           165           27,389
    (Losses) gains on sales and
     retirements of
       long-lived assets and other
        (expense) income, net                      (31,261)           9,557
    Impairments and other charges
     (8)                                                 -         (227,083)
    Income (loss) before income
     taxes                                        $100,306         $(50,711)
                                                  ========         ========
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Rig activity:
    Rig years: (9)
       U.S. Lower 48 Land Drilling                   165.5            167.7
       U.S. Offshore                                  11.5             13.7
       Alaska                                          8.5             11.6
       Canada                                         26.2             22.7
       International (10)                             93.0            109.0
          Total rig years                            304.7            324.7
                                                     =====            =====
    Rig hours: (11)
       U.S. Land Well-servicing                    305,546          322,364
       Canada Well-servicing                        78,243           74,120
                                                    ------           ------
          Total rig hours                          383,789          396,484
                                                   =======          =======
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    (1)  These segments include our drilling, well-servicing and
    workover operations, on land and offshore.
    
</pre>
<p> </p>
<pre>
    
    (2)  Included earnings (losses), net from unconsolidated affiliates,
    accounted for using the equity method, of $2.9 million, $.6 million
    and $.1 million for the three months ended June 30, 2010 and 2009
    and March 31, 2010, respectively, and $3.0 million and $1.9 million
    for the six months ended June 30, 2010 and 2009, respectively.
    
</pre>
<p> </p>
<pre>
    
    (3)  Included earnings (losses), net from unconsolidated affiliates,
    accounted for using the equity method, of $4.6 million, $(11.0)
    million and $.6 million for the three months ended June 30, 2010 and
    2009 and March 31, 2010, respectively, and $5.1 million and $(83.3)
    million for the six months ended June 30, 2010 and 2009,
    respectively.
    
</pre>
<p> </p>
<pre>
    
    (4)  Includes our drilling technology and top drive manufacturing,
    directional drilling, rig instrumentation and         software, and
    construction and logistics operations.
    
</pre>
<p> </p>
<pre>
    
    (5)  Included earnings (losses), net from unconsolidated affiliates,
    accounted for using the equity method, of $2.7 million, $2.3 million
    and $3.0 million, for the three months ended June 30, 2010 and 2009
    and March 31, 2010, respectively, and $5.8 million and $8.8 million
    for the six months ended June 30, 2010 and 2009, respectively.
    
</pre>
<p> </p>
<p>(6)  Represents the elimination of inter-segment transactions.</p>
<p> </p>
<pre>
    
    (7)  Represents the elimination of inter-segment transactions and
    unallocated corporate expenses.
    
</pre>
<p> </p>
<pre>
    
    (8)  Represents impairments and other charges recorded for the three
    months ended June 30, 2009.
    
</pre>
<p> </p>
<pre>
    
    (9)  Excludes well-servicing rigs, which are measured in rig hours.
    Includes our equivalent percentage ownership of rigs owned by
    unconsolidated affiliates.  Rig years represent a measure of the
    number of equivalent rigs operating during a given period.  For
    example, one rig operating 182.5 days during a 365-day period
    represents 0.5 rig years.
    
</pre>
<p> </p>
<pre>
    
    (10) International rig years included our equivalent percentage
    ownership of rigs owned by unconsolidated affiliates which totaled
    2.4 years, 2.3 years and 2.5 years during the three months ended
    June 30, 2010 and 2009 and March 31, 2010, respectively, and 2.5
    years and 2.6 years during the six months ended June 30, 2010 and
    2009, respectively.
    
</pre>
<p> </p>
<pre>
    
    (11)  Rig hours represents the number of hours that our well-
    servicing rig fleet operated during the period.



    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                   NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                                  COMPUTATION OF EARNINGS (LOSSES) PER SHARE
                                                 (Unaudited)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    A reconciliation of the numerators and denominators of the basic and
    diluted earnings (losses) per share computations is as follows:
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                   Three Months Ended
                                                   ------------------
                                                                    
                                                 June 30,         March 31,
                                                 --------         ---------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except per
     share amounts)                         2010            2009     2010
                                            ----            ----     ----
    
</pre>
<p> </p>
<pre>
    
    Net income (loss)
     attributable to Nabors
     (numerator):
    Net income (loss)
     attributable to Nabors              $43,621       $(192,986) $40,200
       Add interest expense on
        assumed conversion of our
        0.94% senior
            exchangeable notes due 2011,
             net of tax (1)                    -               -        -
                                             ---             ---      ---
    
</pre>
<p> </p>
<pre>
    
    Adjusted net income (loss)
     attributable to Nabors -
     diluted                             $43,621       $(192,986) $40,200
                                         -------       ---------  -------
    
</pre>
<p> </p>
<pre>
    
       Earnings (losses) per share:
         Basic                              $.15           $(.68)    $.14
                                            ----           -----     ----
         Diluted                            $.15           $(.68)    $.14
                                            ----           -----     ----
    
</pre>
<p> </p>
<pre>
    
    Shares (denominator):
       Weighted-average number of
        shares outstanding-basic
        (2)                              285,181         283,154  284,672
       Net effect of dilutive stock
        options, warrants and
        restricted
          stock awards based on the if-
           converted method                4,615               -    6,064
       Assumed conversion of our
        0.94% senior exchangeable
        notes due 2011 (1)                     -               -        -
                                             ---             ---      ---
       Weighted-average number of
        shares outstanding -
        diluted                          289,796         283,154  290,736
                                         -------         -------  -------
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                       Six Months Ended
                                                       ----------------
                                                           June 30,
                                                           --------
    
</pre>
<p> </p>
<pre>
    
    (In thousands, except per share amounts)           2010           2009
                                                       ----           ----
    
</pre>
<p> </p>
<pre>
    
    Net income (loss) attributable to Nabors
     (numerator):
    Net income (loss) attributable to Nabors        $83,821       $(67,816)
       Add interest expense on assumed conversion
        of our 0.94% senior
            exchangeable notes due 2011, net of tax
             (1)                                          -              -
                                                        ---            ---
    
</pre>
<p> </p>
<pre>
    
    Adjusted net income (loss) attributable to
     Nabors -diluted                                $83,821       $(67,816)
                                                    -------       --------
    
</pre>
<p> </p>
<pre>
    
       Earnings (losses) per share:
         Basic                                         $.29          $(.24)
                                                       ----          -----
         Diluted                                       $.29          $(.24)
                                                       ----          -----
    
</pre>
<p> </p>
<pre>
    
    Shares (denominator):
       Weighted-average number of shares
        outstanding-basic (2)                       284,927        283,126
       Net effect of dilutive stock options,
        warrants and restricted
          stock awards based on the if-converted
           method                                     5,339              -
       Assumed conversion of our 0.94% senior
        exchangeable notes due 2011 (1)                   -              -
    
</pre>
<p> </p>
<pre>
    
       Weighted-average number of shares
        outstanding - diluted                       290,266        283,126
                                                    -------        -------
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    (1)  Diluted earnings (losses) per share for the three and six months
    ended June 30, 2010 and 2009 and the three months ended March 31,
    2010 excluded any incremental shares issuable upon exchange of the
    0.94% senior exchangeable notes due 2011.  Between 2008 and through
    June 30, 2010, we purchased approximately $1.3 billion par value of
    these notes in the open market, leaving approximately $1.4 billion
    par value outstanding.  The number of shares that we would be
    required to issue upon exchange consists of only the incremental
    shares that would be issued above the principal amount of the notes,
    as we are required to pay cash up to the principal amount of the
    notes exchanged. We would issue an incremental number of shares only
    upon exchange of these notes.  These shares are included in the
    calculation of the weighted-average number of shares outstanding in
    our diluted earnings per share calculation only when our stock price
    exceeds $45.83 as of the last trading day of the quarter and the
    average price of our shares for the ten consecutive trading days
    beginning on the third business day after the last trading day of
    the quarter exceeds $45.83, which did not occur during the three and
    six months ended June 30, 2010 and 2009 or the three months ended
    March 31, 2010.
    
</pre>
<p> </p>
<pre>
    
    (2)  On July 31, 2009, the exchangeable shares of Nabors (Canada)
    Exchangeco Inc. ("Nabors Exchangeco") were exchanged for Nabors
    common shares on a one-for-one basis.  Basic shares outstanding
    included (1) the weighted-average number of common shares and
    restricted stock of Nabors and (2) the weighted-average number of
    exchangeable shares of Nabors Exchangeco: 285.2 million shares
    cumulatively for the three months ended June 30, 2010; 283.1 million
    and .1 million shares, respectively, for the three months ended June
    30, 2009; 284.7 million shares cumulatively for the three months
    ended March 31, 2010; 284.9 million shares cumulatively for the six
    months ended June 30, 2010; and 283.0 million and .1 million shares,
    respectively, for the six months ended June 30, 2009.
    
</pre>
<p> </p>
<pre>
    
    For all periods presented, the computation of diluted earnings
    (losses) per share excluded outstanding stock options and warrants
    with exercise prices greater than the average market price of
    Nabors' common shares, because their inclusion would have been anti-
    dilutive and because they were not considered participating
    securities. The average number of options and warrants that were
    excluded from diluted earnings (losses) per share that would have
    potentially diluted earnings (losses) per share in the future were
    14,894,841 and 35,783,476 shares during the three months ended June
    30, 2010 and 2009, respectively; and 10,055,869 shares during the
    three months ended March 31, 2010; and 12,475,355 and 33,403,319
    shares during the six months ended June 30, 2010 and 2009,
    respectively. In any period during which the average market price of
    Nabors' common shares exceeds the exercise prices of these stock
    options and warrants, such stock options and warrants are included
    in our diluted earnings (losses) per share computation using the if-
    converted method of accounting.  Restricted stock is included in our
    basic and diluted earnings (losses) per share computation using the
    two-class method of accounting in all periods because it is
    considered a participating security.



    
</pre>
<p> </p>
<p> </p>
<pre>
    
                    NABORS INDUSTRIES LTD. AND SUBSIDIARIES
     CONSOLIDATED STATEMENTS OF INCOME (LOSS) ITEMS EXCLUDING CERTAIN
                          NON-CASH CHARGES (NON-GAAP)
                                  (Unaudited)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                     
                                                              As adjusted to
    (In thousands, except per        Actuals                  Exclude Charges
     share amounts)                   (GAAP)        Charges      (Non-GAAP)
                                      ------        -------      ----------
    
</pre>
<p> </p>
<pre>
    
    2010:                          Three Months Ended June 30, 2010
                                   --------------------------------
    
</pre>
<p> </p>
<pre>
    
    Income (loss) before income
     taxes                           $51,264       $(11,506)        $62,770
    Net income (loss)
     attributable to Nabors           43,621        (12,230)         55,851
    Diluted earnings
     (losses) per share                $0.15         $(0.04)          $0.19
    
</pre>
<p> </p>
<pre>
    
                                 Six Months Ended June 30, 2010
                                 ------------------------------
    
</pre>
<p> </p>
<pre>
    
    Income (loss) before income
     taxes                          $100,306       $(33,182)       $133,488
    Net income (loss)
     attributable to Nabors           83,821        (33,415)        117,236
    Diluted earnings
     (losses) per share                $0.29         $(0.11)          $0.40
    
</pre>
<p> </p>
<pre>
    
                               Three Months Ended March 31, 2010
                               ---------------------------------
    
</pre>
<p> </p>
<pre>
    
    Income (loss) before income
     taxes                           $49,042       $(21,676)        $70,718
    Net income (loss)
     attributable to Nabors           40,200        (21,185)         61,385
    Diluted earnings
     (losses) per share                $0.14         $(0.07)          $0.21
    
</pre>
<p> </p>
<pre>
    
    2009:                       Three Months Ended June 30, 2009
                                --------------------------------
    
</pre>
<p> </p>
<pre>
    
    Operating revenues and
     Earnings (losses) from
     unconsolidated
     affiliates                     $859,742        $(8,295)       $868,037
    Adjusted income (loss) derived
     from operating activities        73,448        (70,409)        143,857
    Income (loss) before income
     taxes                          (208,103)      (297,492)         89,389
    Net income (loss)
     attributable to Nabors         (192,986)      (283,894)         90,908
    Diluted earnings
     (losses) per share               $(0.68)        $(1.00)          $0.32
    
</pre>
<p> </p>
<pre>
    
                                 Six Months Ended June 30, 2009
                                 ------------------------------
    
</pre>
<p> </p>
<pre>
    
    Operating revenues and
     Earnings (losses) from
     unconsolidated
     affiliates                   $1,993,360       $(83,295)     $2,076,655
    Adjusted income
     (loss) derived
     from operating
     activities                      272,531       (145,409)        417,940
    Income (loss) before income
     taxes                           (50,711)      (372,492)        321,781
    Net income (loss)
     attributable to Nabors          (67,816)      (343,144)        275,328
    Diluted earnings
     (losses) per share               $(0.24)        $(1.21)          $0.97



    
</pre>
<p> </p>
<p> </p>
<pre>
    
                       NABORS INDUSTRIES LTD. AND SUBSIDIARIES
                        SUMMARY OF NON-CASH CHARGES (NON-GAAP)
                                     (Unaudited)
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                    Three Months Ended
                                                    ------------------
                                                 June 30,          March 31,
                                                 --------          ---------
    (In thousands)                        2010              2009        2010
                                          ----              ----        ----
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Equity method oil and gas joint
     venture impairments                    $-           $(8,295)         $-
    Goodwill impairment                      -           (14,689)          -
    Impairments of long-lived assets
     to be disposed of other than
      by sale                                -           (64,229)          -
    Stock compensation charge                -           (62,114)          -
    Impairment of oil and gas
     financing receivable                    -          (112,516)          -
    Other-than-temporary impairment
     on debt security                        -           (35,649)          -
    Other non-operational items        (11,506)                -     (21,676)
                                       -------               ---     -------
    
</pre>
<p> </p>
<p>Total charges before income taxes  (11,506)         (297,492)    (21,676)</p>
<p> </p>
<pre>
    
    Taxes, net                            (724)           13,598         491
                                          ----            ------         ---
    
</pre>
<p> </p>
<pre>
    
    Total charges after income taxes  $(12,230)        $(283,894)   $(21,185)
                                      ========         =========    ========
    
</pre>
<p> </p>
<p> </p>
<pre>
    
                                                   Six Months Ended
                                                   ----------------
                                                       June 30,
                                                       --------
    (In thousands)                              2010              2009
                                                ----              ----
    
</pre>
<p> </p>
<p> </p>
<pre>
    
    Equity method oil and gas joint venture
     impairments                                  $-          $(83,295)
    Goodwill impairment                            -           (14,689)
    Impairments of long-lived assets to be
     disposed of other than
      by sale                                      -           (64,229)
    Stock compensation charge                      -           (62,114)
    Impairment of oil and gas financing
     receivable                                    -          (112,516)
    Other-than-temporary impairment on
     debt security                                 -           (35,649)
    Other non-operational items              (33,182)                -
                                             -------               ---
    
</pre>
<p> </p>
<p>Total charges before income taxes        (33,182)         (372,492)</p>
<p> </p>
<pre>
    
    Taxes, net                                  (233)           29,348
                                                ----            ------
    
</pre>
<p> </p>
<pre>
    
    Total charges after income taxes        $(33,415)        $(343,144)
                                            ========         =========



    

For further information: For further information: Dennis A. Smith, Director of Corporate Development for Nabors Corporate Services, Inc., +1-281-775-8038, or to request Investor Materials, Corporate Headquarters, +1-441-292-1510, mark.andrews@nabors.com.

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Nabors Industries Ltd.

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