/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
TSX SYMBOL: TDG
CALGARY, April 15 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or "the Company") is pleased to announce that it has agreed to build two new rigs for delivery into operations in 2011.
"Demand for high quality, modern equipment has continued to increase and contract terms have now moved to a point where it is attractive for us to build new equipment," said Lyle Whitmarsh, Trinidad's President and Chief Executive Officer. "The rigs we are adding to our fleet fit well with our strategy of deep, technically advanced equipment and we expect that they will remain competitive long after their initial contracts expire."
Rig No. 139 will be an 18,000 foot (5,500 metre) triple rig with 1,500 horsepower and equipped with Trinidad's industry-leading technology and automation. The rig is expected to cost approximately $18 million and be operational in the Eagle Ford Shale in Texas in the second half of the year. The rig is backed by a three-year, take-or-pay contract that guarantees 100% utilization throughout the duration of the contract.
Rig No. 57 will be an 18,000 foot (5,500 metre) triple rig with 1,500 horsepower and is being built to work in Steam Assisted Gravity Drainage (SAGD) applications in north-eastern Alberta. In addition to Trinidad's usual automation and technical advancements, this rig will include a system that provides improved fluid handling ability while drilling in a pad environment, and a new pipe handling system that removes the need for a crew member to be positioned in the derrick, increasing both the performance and the safety of the rig's operations. Trinidad expects that it will cost approximately $20 million to build the rig and that it will be operational towards the end of 2011. The rig is under a four-year, take-or-pay contract that guarantees a minimum of 1,200 days over a four year period which equates to an 82% average utilization over the term of the contract.
In addition to these two newly-announced rigs, Trinidad is currently building a natural gas powered rig for operations in the Horn River in north-eastern British Columbia. The Company expects that the construction of the three new rigs, the completion of the 2010 rig construction program and capital enhancements planned for a small number of existing rigs will total approximately $80 million of capital expenditures in 2011.
Following the completion of the rigs being constructed in 2011, Trinidad will have 122 drilling rigs with 62 rigs in the US, 57 rigs in Canada and 3 rigs in Mexico. In addition, Trinidad has 22 service rigs, 20 preset and coring rigs and five barge drilling rigs.
Trinidad is a growth-oriented corporation that trades on the Toronto Stock Exchange (TSX) under the symbol TDG. Trinidad's divisions operate in the drilling, well-servicing, coring and barge-drilling sectors of the North American oil and natural gas industry with operations in Canada, the United States and 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.
The document contains certain forward-looking statements relating to Trinidad's plans, strategies, objectives, expectations and intentions. 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. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this document. The forward-looking information and statements included in this document 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. In particular, but without limiting the foregoing, this document may contain forward-looking information and statements pertaining to the completion of announced rig construction programs on a timely basis and on economical terms; the assumption that Trinidad's customers will honour their take-or-pay contracts; fluctuations in the demand for Trinidad's services; the ability for Trinidad to attract and retain qualified personnel, in particular field staff to crew the Company's rigs; the existence of competitors, technological changes and developments in the oilfield services industry; the existence of operating risks inherent in the oilfield services industry; assumptions respecting capital expenditure programs and other expenditures by oil and gas exploration and production companies; assumptions regarding commodity prices, in particular oil and natural gas; assumptions respecting supply and demand for commodities, in particular oil and natural gas; assumptions regarding foreign currency exchange rates and interest rates; the existence of regulatory and legislative uncertainties; the possibility of changes in tax laws; and general economic conditions including the capital and credit markets. Trinidad cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained in this document speak only as of the date of this document 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.
SOURCE Trinidad Drilling Ltd.
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: email@example.com