Pantera Drilling Income Trust Reports Results for the Second Quarter Ended June 30, 2007



    /NOT FOR DISSEMINATION INTO THE UNITED STATES/

    (TSX:RIG.UN)

    CALGARY, Aug. 10 /CNW/ - Pantera recorded a net loss for the quarter of
$1.1 million as compared with net earnings of $146,700 for the same period in
2006. For the six months ended June 30, 2007, net earnings decreased to   
$2.0 million from $2.6 million in 2006, a decrease of 23%.
    Pantera has retained its core group of customers and maintained, and in
certain cases re-negotiated, contracts for five of its eight drilling rigs,
securing work for the remainder of 2007 and into 2008. Due to the decline in
demand for drilling rig services in Western Canada, and consistent with the
industry trend, Pantera's day rates on average decreased 15% in recently
negotiated contracts. Two of the contracts provide a guaranteed minimum number
of revenue generating days. Recent successes in marketing efforts support
Management's expectation that utilization rates will continue to improve in Q3
and Q4.

    
    -------------------------------------------------------------------------
    HIGHLIGHTS
                     Three months ended June 30,    Six months ended June 30,
    FINANCIAL             2007       2006 Change       2007       2006 Change
    -------------------------------------------------------------------------
    (000s, except         ($)        ($)    (%)        ($)        ($)     (%)
     for units and
     per unit
     amounts)
    -------------------------------------------------------------------------
    Revenue              1,195      4,870   (75)     13,563     14,337    (5)
    -------------------------------------------------------------------------
    Gross margin(1)       (170)     1,366  (112)      4,935      5,373    (8)
    -------------------------------------------------------------------------
    Net earnings
     (loss)             (1,086)       147  (839)      1,980      2,576   (23)
    -------------------------------------------------------------------------
      Per unit
       (basic and
       diluted)(2)        (.17)       .02  (950)        .32        .49   (35)
    -------------------------------------------------------------------------
    Funds from
     (used in)
     operations(1)      (1,027)       479  (314)      2,860      3,523   (19)
    -------------------------------------------------------------------------
      Per unit
       (basic and
       diluted)(2)        (.17)       .08  (313)        .46        .67   (31)
    -------------------------------------------------------------------------
    EBITDA(3)             (632)       598  (206)      3,613      3,993   (10)
    -------------------------------------------------------------------------
    Units
     outstanding
     (weighted
     average)(2)     6,214,028  6,000,000     4   6,164,952  5,281,768    17
    -------------------------------------------------------------------------
    Units
     outstanding
     (end of
     period)(2)      6,256,701  6,000,000     4   6,256,701  6,000,000     4
    -------------------------------------------------------------------------
    OPERATING
    -------------------------------------------------------------------------

                                            (%)                           (%)
    -------------------------------------------------------------------------
    Number of rigs
     (end of period)
      Conventional
      Coil                   7          4    75           7          4    75
      Total                  1          2    50           1          2    50
                            -------------------------------------------------
                             8          6    33           8          6    33
    -------------------------------------------------------------------------
    Number of rigs
     (weighted average)      8          6    33         7.5        5.6    34
    -------------------------------------------------------------------------
    Operating days          16        170   (91)        409        519   (21)
    -------------------------------------------------------------------------
    Industry
     utilization
     average(4)             16%        36%  (56)         37%        58%  (36)
    -------------------------------------------------------------------------
    Pantera
     utilization
     rates(5)
      Conventional           3%        47%  (94)         19%        64%  (70)
      Coil                   0%        0%     0           0%        30% (100)
                            -------------------------------------------------
      Weighted Average       2%       31%   (94)         14%        52%  (73)
    -------------------------------------------------------------------------

    (1) Funds from operations as used in this report represents cash flow
        from operating activities before changes in non-cash operating
        working capital. Gross margin represents revenue less operating
        expenses. Readers are cautioned that funds from operations and gross
        margin do not have a standardized meaning prescribed by GAAP and
        therefore may not be comparable to similar measures presented by
        other issuers. However, Pantera does compute funds from operations
        and gross margin on a consistent basis for each reporting period.
        Management believes that in addition to net earnings, funds from
        operations is a useful supplemental measure as it provides an
        indication of the funds that are available for investing and
        financing activities, including distributions to unitholders.
        Management believes gross margin is a useful supplemental measure of
        operating performance and is particularly relevant to readers within
        the investment community.
    (2) The units outstanding give effect to the restructuring of Pantera in
        2005 and the February 8, 2006 split of units of the Trust on the
        basis of 10.739754 units for each trust unit of the Trust held
        immediately prior to the effective time of the split.
    (3) EBITDA means net earnings before interest, taxes, depreciation and
        amortization. Readers are cautioned that EBITDA does not have a
        standardized meaning prescribed by GAAP and therefore may not be
        comparable to similar measures presented by other issuers. However,
        Pantera does compute EBITDA on a consistent basis for each reporting
        period. Management believes that, in addition to net earnings, EBITDA
        is a significant indication of success for Pantera and is
        particularly relevant to readers within the investment community.
    (4) Source: Canadian Association of Oilwell Drilling Contractors (CAODC).
    (5) For purposes of calculating utilization rates the number of rigs
        (weighted average) for Q2, 2007 has been adjusted to reflect the
        temporary removal of Rig No.'s 3 and 4 on October 1, 2006 as they
        were unavailable for use by Pantera.
    

    Rig activity in the second quarter is typically the lowest in the year.
2007 was no exception, with Pantera recording 16 operating days for the
quarter. One rig worked into April and it was shut down for spring break-up
early in the month. Load weight restrictions placed on secondary roads in the
spring restrict rig movement until at least May. The large amount of snowfall
this winter extended the break-up period into June and spring rains delayed
startup until the last week of the month. In comparison, last year all
Pantera's conventional rigs (No.'s 4 - 7) were able to work into April with
one rig working throughout the entire quarter on a horizontal pad drilling
program.
    The oil and gas industry in Western Canada has pulled back sharply from
the pace set in 2006. Lower gas pricing and higher finding and development
costs coupled with a very wet spring resulted in low industry rig utilizations
for the quarter. The uncertainty over the economics of drilling in Western
Canada continues and in an effort to diversify Pantera's operations marketing
efforts have been expanded to include areas outside of Western Canada.
    In addition to the above mentioned contracts, Pantera has committed to a
one rig drilling program outside the Western Canadian Sedimentary Basin and is
currently in discussions with several other operators in the area for
additional work. It is anticipated that the rig will remain active for a
period of time extending into 2008.
    Revenue for the three months ended June 30, 2007 was $1.2 million, a
decrease of $3.7 million from the prior year due to the extended wet weather
conditions and resulting drilling inactivity. On a year-to-date basis, revenue
was $13.6 million, a decrease of $800,000 from the prior year.
    Revenue generated on an operating day basis in the second quarter of 2007
of $74,700 was significantly higher than the amount generated for the same
period in 2006 of $28,700. Consistent with industry standards, Pantera
calculates operating days as the number of days a rig is in operation from
spud to rig release. Skidding or moving between well locations, rigging up
prior to spud, tearing out after rig release, and stand by days are not
included in the calculation of operating days. In the quarter Pantera recorded
16 operating days and 22 moving and stand by days that were not considered
operating days, but nonetheless generated revenue. The large number of moving
and standby days in relation to actual operating days accounts for the
significant variance in revenue per operating day for the quarter.
    In accordance with the policy adopted by the Trustees, the Trust
continues to make regular monthly cash distributions. Since March 2006, the
Trust has made monthly distributions to unitholders in the amount of    
$0.067 per trust unit.
    The Trust is a taxable entity under the Income Tax Act (Canada) and is
taxable only on the income that is not distributed or distributable to the
unitholders.
    On June 12, 2007, Bill C52, released by the Department of Finance on
December 21, 2006 to implement its October 31, 2006 announcement of the
changes to taxability of Income Trusts, received third reading in the House of
Commons. Under this legislation, distributions to unitholders will not be
deductible by publicly traded income trusts and, as a result, the Trust will
be taxed on its income similar to corporations.
    As a result of passing third reading, these measures are now considered
substantively enacted for purposes of Canadian generally accepted accounting
principles. Accordingly, the Trust has measured, in the second quarter of
2007, future income tax assets and liabilities associated with the change in
the legislation. There is no impact, on the future tax recognized in the
financial statements, resulting from the implementation of this tax
legislation as it is expected that all existing taxable temporary differences
will reverse prior to January 1, 2011, the date the taxation changes take
effect. Accordingly, all taxable temporary differences have been recognized at
a zero taxation rate. The scheduling of the reversal of temporary differences
is based on management's best estimates and current assumptions, which may
change.
    Additional information relating to the Trust, including its annual
information form, can be accessed on the Trust's website at
www.panteradrilling.com and under the Trust's profile on the System for
Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

    The Trust is an open-ended, investment trust governed by the laws of the
Province of Alberta pursuant to the Declaration of Trust. The Trust was
established for the purpose of investing in property including the securities
of Pantera Drilling Limited Partnership and Pantera Drilling Inc. The
beneficiaries of the Trust are the holders of the trust units. The business of
Pantera involves the provision of contract drilling services to oil and
natural gas exploration and production companies operating in Western Canada.

    This press release contains certain statements that constitute
forward-looking statements that involve unknown risks, uncertainties and other
factors that may cause actual results, performance or achievements of Pantera,
or industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such factors include general economic and business conditions, the
ability of Pantera to implement its business strategy, and changes in or
failure to comply with government regulations, especially health, safety and
environment laws, regulations and guidelines. Readers are cautioned that the
assumptions used in the preparation of such information, although considered
reasonable at the time of preparation, may prove to be imprecise and, as such,
undue reliance should not be placed on forward-looking statements.
Furthermore, the forward-looking statements contained in this press release
are made as of the date hereof, and Pantera undertakes no obligation, except
as required by applicable securities legislation, to update publicly or to
revise any of the included forward-looking statements, whether as a result of
new information, future events or otherwise.

    %SEDAR: 00023106E




For further information:

For further information: Terry Rosentreter, President and Chief
Executive Officer, or Lorna Pollock, Chief Financial Officer at: Ph: (403)
515-8400, Fax: (403) 515-8405, E-mail: terryr@panteradrilling.com,
lpollock@panteradrilling.com

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PANTERA DRILLING INCOME TRUST

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