Trinidad Drilling Ltd. announces the expansion of its Mexican operations and the extension of existing contracts in Mexico



    
    /NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
    DISSEMINATION IN THE UNITED STATES./

    TSX SYMBOL: TDG, TDG.DB
    

    CALGARY, June 22 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or the
"Company") (TSX-TDG and TDG.DB) is pleased to announce that it has agreed to
move four existing, under-utilized rigs from its Canadian operations into
Mexico under long-term, take-or-pay contract.
    Trinidad has agreed with its current business partner in Mexico, a large
US-based, multi-service provider, to redeploy four existing rigs from its
Canadian operations into the Chicontepec region in central eastern Mexico. The
rigs are contracted to work at a utilization rate of 100 percent for an
initial term of 18 months, with a further 18-month extension option.
    "Our ability to expand our operations in Mexico is a direct reflection of
the superior performance we have shown to date," said Lyle Whitmarsh,
Trinidad's President and Chief Executive Officer. "Our people and our
equipment have established a strong reputation for Trinidad in Mexico and we
expect to continue to show a growing presence in the country."
    The rigs selected for redeployment are part of Trinidad's existing
Canadian fleet and are not currently under contract or working. Minor
enhancements will be made to the rigs in order to prepare them for the Mexican
climate and the specific work conditions they will be operating in. These
enhancements are expected to total $8 million. The rigs are anticipated to be
operational in Mexico beginning in the third quarter of 2009, with all four
rigs drilling in Mexico by the end of the year. The costs associated with
relocating the rigs into Mexico and demobilization back to Canada within the
first 18 months will be paid by the operator. Following the first 18 months,
the responsibility of the demobilization costs will be based on a sliding
scale, dependant on contract extension in Mexico.

    
    A summary of the rigs being redeployed follows:

                                                     Draw works Horsepower
    Rig Number   Rig Type            Depth Capacity          Rating
    -------------------------------------------------------------------------
    Rig 32       Telescopic Double       3500m               850 Hp
    Rig 73       Telescopic Double       3000m               700 Hp
    Rig 92       Telescopic Double       3000m               700 Hp
    Rig 94       Telescopic Double       3000m               700 Hp
    

    While activity levels in the US and Canada have been experiencing strong
declines over the past six months, demand for high-quality drilling equipment
has been growing in Mexico. The Mexican national oil company, Petróleos
Mexicanos, is under pressure to replace declining existing production levels
and has aggressive development plans for Chicontepec and other producing
regions over the next few years. Trinidad's strategy of establishing a
presence and a solid reputation in Mexico has paid off and the Company is now
able to participate in this growth area, utilizing equipment that was
previously under-utilized.
    Trinidad's initial step into Mexico in the fourth quarter of 2008,
involved three rigs which were contracted for six months, with a six-month
extension option. Following their strong performance, these rigs have been
extended under similar terms to the four rigs discussed above until April 30,
2010, with a further 12-month extension option.
    Trinidad's Mexican fleet now totals seven drilling rigs. In addition,
Trinidad has 55 land drilling rigs and four barge drilling rigs in the US and
53 land drilling rigs in Canada. With these new contracts, Trinidad's
percentage of fleet under contract increases to approximately 50 percent,
split geographically with approximately 25 percent of its Canadian fleet and
65 percent of its US and Mexican fleet under long-term, take-or-pay contracts.
The average term remaining on the contracts is approximately 2.5 years.

    Trinidad is a growth-oriented corporation that trades on the Toronto
Stock Exchange (TSX) under the symbol TDG and TDG.DB. Trinidad's divisions
operate in the drilling, well-servicing, coring and barge-drilling sectors of
the North American oil and natural gas industry. With the completion of the
2009 rig construction program, Trinidad will have 119 land drilling rigs
ranging in depths from 1,000 - 6,500 metres and operations in Canada, the
United States and Mexico. In addition to its land drilling rigs, Trinidad has
23 service rigs, 20 pre-set and coring rigs and 4 barge rigs currently
operating in the Gulf of Mexico. Trinidad is focused on providing modern,
reliable, expertly designed equipment operated by well-trained and experienced
personnel. Trinidad's drilling fleet is one of the most adaptable,
technologically advanced and competitive in the industry.

    Advisory Respecting Forward-Looking Statements

    This news release contains certain forward-looking information and
statements within the meaning of applicable securities laws. The use of any of
the words "expect", "anticipate", "continue", "estimate", "objective",
"ongoing", "may", "will", "project", "should", "believe", "plans", "intends",
"confident", "might" and similar expressions are intended to identify
forward-looking information or statements. In particular, but without limiting
the foregoing, this news release contains forward-looking information and
statements that involve substantial known and unknown risks and uncertainties,
certain of which are beyond Trinidad's control, including the following: (i)
the completion of the rig construction programs on a timely basis and on
economical terms; (ii) the assumption that Trinidad's customers will honour
their take-or-pay contracts; (iii) the ability for Trinidad to attract and
retain qualified crews to crew their rigs; (iv) assumptions respecting capital
expenditure programs and other expenditures by oil and gas exploration and
production companies; (v) assumptions respecting commodity prices, foreign
currency exchange rates and interest rates; (vi) assumptions respecting supply
and demand for commodities; and (vii) other expectations, beliefs, plans,
goals, objectives, assumptions, information and statements about possible
future events, conditions, results of operations or performance. Various
assumptions were used in drawing the conclusions or making the projections
contained in the forward-looking statements throughout this news release.
    The forward-looking information and statements included in this news
release are not guarantees of future performance and should not be unduly
relied upon. Forward-looking statements are based on current expectations,
estimates and projections that involve a number of risks and uncertainties,
which could cause actual results to differ materially from those anticipated
and described in the forward-looking statements. Such information and
statements involve known and unknown risks, uncertainties and other factors
that may cause actual results or events to differ materially from those
anticipated in such forward-looking information or statements.
    Trinidad cautions that the foregoing list of assumptions, risks and
uncertainties is not exhaustive. The forward-looking information and
statements contained in this news release speak only as of the date of this
news release, and Trinidad assumes no obligation to publicly update or revise
them to reflect new events or circumstances, except as may be required
pursuant to applicable securities laws.
    This news release shall not constitute an offer to sell or the
solicitation of an offer to buy the shares in any jurisdiction. The shares
offered will not be and have not been registered under the United States
Securities Act of 1933 and may not be offered or sold in the United States or
to a United States person, absent registration, or an applicable exemption
therefrom.





For further information:

For further information: Lyle Whitmarsh, President and Chief Executive
Officer, (403) 265-6525; Brent Conway, Executive Vice President and Chief
Financial Officer, (403) 265-6525; Lisa Ciulka, Director of Investor
Relations, (403) 294-4401, email: lciulka@trinidaddrilling.com

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Trinidad Drilling Ltd.

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