Corporate Presentation November 2015 IT'S ABOUT PERFORMANCE IT'S ABOUT PERFORMANCE 1
Why Invest In Trinidad Trinidad has: High quality fleet Diversified operations Solid plan for the downturn; well positioned for the rebound International expansion opportunities Improved liquidity IT'S ABOUT PERFORMANCE 3
Operations Overview Canada 82 rigs US 71 rigs 2 barges Saudi* 4 rigs Mexico* 6 rigs UAE 1 rig Rig Manufacturing Innovation & Design IT'S ABOUT PERFORMANCE * Rigs operating under the JV included at 100 percent; does not…
North American Industry Update Canada activity expected to lower early ahead of holiday season US activity stalled, new opportunities limited Competition very high, with downward pressure on dayrates Early termination of contracts…
Industry Active Rig Counts North American activity below previous lows E&Ps delaying 2016 budgeting with continued volatility Cost structure being re-set across the industry Canadian Industry Active Rig Count US Industry Active Rig…
Trinidad Update
CanElson Acquisition Update Effective date August 11, 2015 Overwhelming approval from shareholders 95% approval from 60% of all outstanding shareholders Issued 88.7 million shares and 50 million in cash Total consideration paid 345…
Benefits of CanElson Combination Greater scale to capitalize on opportunities Larger, more diverse fleet with industry-leading activity Savings through increased scale and operating efficiencies Expanded management team and board of…
Trinidads Canadian Operations Active in key plays Key Operating Areas Consistent industry-leading activity Customers waiting to Liard Montney commit to rigs Oil Duvernay sands Lloyd Activity low by historical Heavy Oil…
Different Markets, Different Needs Tele-double rigs the most active rigs in Canada Mechanical rigs with high hookload and large pumps AC rigs make up approx. 10-15%(1) of Canadian market Trinidads Canadian fleet has the right…
Trinidads United States Operations US operations less seasonal Key Operating Areas Bakken Dayrates and activity remain under pressure Niobrara Customers waiting to commit to rigs Mississippi Lime Permian Barnett…
US More Technology Focused US customers focused on efficiency gains from technology AC rigs, preferably with moving systems and large pumps the rig of choice Trinidad known in the US for its high performance, AC powered rigs…
Trinidads International Operations Joint venture in Saudi Arabia Key Operating Areas and Mexico with Halliburton(1) (60/40 split) Joint venture with Mexico Mexico Saudi with DCM (50/50 split) UAE Less affected by volatile commodity…
HAL Joint Venture Saudi Four rigs currently operating in Ghawar field 2015 is first full year of operations Costs lowering as operations grow Drilling efficiencies have improved 40% increase in well delivery performance from first…
HAL Joint Venture Mexico Construction of new builds complete Three rigs working; one receiving standby New builds performance exceeding expectations In Mexico, we completed drilling the first well using rigs from our joint venture…
Joint Venture International Growth Strong performance leads to opportunities: Replace existing rigs Supply high spec rigs for new projects Can be new builds or deploy existing US or Canadian rigs Additional joint venture…
Short Term Plan for the Downturn
Consistent Industry Outperformance Trinidads rigs are more active Canadian Utilization Rates US Average Active Rig Count TDG US US 70% 65 Trinidads US 2,800 Trinidads Canadian Utilization 60 Average Active Rig Count 60% 55 2,400 50…
Deep and Modern Fleet In-demand rigs generate higher dayrates and margins In Demand Specifications Rig Fleet Horizontal Depth 23% 67% 10% 0 - 11,999 ft 12,000-17,999 ft 7% 22% 18,000+ ft 70% Rig Fleet Age 23% Tier 1 - High…
Reduced Cost Structure Highly variable cost structure Field labour fluctuates with activity Lower overhead costs Reduction in salaried headcount Wage rollbacks Cost reduction strategies with suppliers Reduced capital budget…
Conservative Capital Program 2015 Capital Budget 185 million(1)(2) 2015 Capital Program (mm) Complete US new builds 34 Completed Mexico TDI 60 39 JV rigs Select upgrades / 40 12 maintenance capital / New Builds Upgrades…
Customer Backed Growth We only build rigs under long-term contracts Approximately 35% of fleet on long-term contract Just under 1.5 years average term remaining IT'S ABOUT PERFORMANCE 23
Improved Liquidity Lower leverage following CanElson acquisition Funds available on credit lines Q3 2015 Debt/EBITDA at 2.37(1) times Outstanding debt largely non-covenant debt Can use CanElsons trailing 12 months in covenant…
Long Term Strategy
Future Growth Opportunities When market conditions improve Trinidad has: Expertise, customer base and track record to capture North American market share A good vehicle for international growth through its joint venture Independent…
Investing in People and Safety Skilled crews drive improved performance and customer demand Experienced, well-trained people our biggest asset Competency training program implemented Industry leading safety processes Retain…
Long Term Debt Plan Long term leverage target of 1.5 times debt/EBITDA Review ways to lower leverage Grow EBITDA base Reduce future capital budgets, pursue only high return projects Sell additional assets to the JV (40% of value…
Why Invest In Trinidad Trinidad has: High quality fleet Diversified operations Solid plan for the downturn; well positioned for the rebound International expansion opportunities Improved liquidity IT'S ABOUT PERFORMANCE 29
APPENDIX IT'S ABOUT PERFORMANCE IT'S ABOUT PERFORMANCE 30
Third Quarter Financial Highlights(3) Three months ended September 30, Nine months ended September 30, ( tho usands except share and per share data) 2015 2014 % Cha nge 2015 2014 % Cha nge Revenue 124,285 244,538 (49.2) 413,894 664,988…
Debt Overview Debt/EBITDA at 2.65 times at Q3 2015, 2.37(1) including accumulative JV EBITDA Debt covenants Debt/EBITDA max of 4.5 times (2) Senior Debt/EBITDA max of 3.0 times EBITDA/Cash Interest Expense min of 2.75 times Credit…
Historical Dayrates(1) Dayrates Canada Rate Per Operating Day vs Operating Margin Dayrates US Rate Per Operating Day vs Operating Margin (CDN) (US) 35,000 50% 30,000 60% 30,000 25,000 50% 40% 25,000 20,000 40% 20,000 30% 15,000 30%…
Combined Fleet Expands Diversity Canada Plays Liard Montney Duvernay Deep Basin Oil sands Lloyd Heavy Oil Cardium Alberta Bakken US…
A Continued Focus on Safety Total Recordable Incident Rates TRIF 4.00 3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00 TRIF Total Recordable Injury Frequency, 12 month corporate rolling average Starting August 2015 Pro forma IT'S…
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