*Rig 576, Loving County TX, Permian Basin TSX: PDTSX: PD NYSE: NYSE:PDS PDS PRECISION DRILLING CORPORATION February 2019 1
Precisions 2018 Strategic Priorities TECHNOLOGY AS A DIFFERENTIATOR Commercial deployment of Process Automation Controls and Directional Guidance Systems on a wide scale FINANCIAL PERFORMANCE Enhance financial performance…
Precisions 2019 Strategic Priorities REDUCE DEBT WITH FREE CASH FLOW Generate strong free cash flow and utilize 100 million to 150 million to reduce debt in 2019; increased long-term debt reduction targets to 400 million to 600…
Creating Shareholder Value HIGH PERFORMANCE SUPER SERIES FLEET MARKET SHARE GAINS & PREMIUM PRICING DRIVE FINANCIAL PERFORMANCE CASH FLOW GENERATION FOR DEBT REPAYMENT AND ENHANCED EQUITY VALUE 5
PRECISION AT A GLANCE High Performance Land Driller 257 Drilling Rigs: Canada (135) U.S. (105) International (17) 210 Service Rigs: Canada (202) U.S. (8) Complementary Services: Camps & Catering, Rentals and Water…
HISTORICAL NORTH AMERICAN DRILLING ACTIVITY U.S. ACTIVITY IMPROVING IN 2018 U.S. LAND RIG COUNT CANADIAN LAND RIG COUNT 10 YEAR HISTORY 5 YEAR HISTORY 1,804 2012-2017 Range 2,000 2014 Average 800 Active Rigs 2014 1,800 2016 700…
Precisions High Performance Foundation PRECISION SYSTEMS + PRECISION CREWS SUPER SERIES RIGS SCALE 8
SYSTEMS + SCALE Driving Operational Excellence and Lower Costs IT Infrastructure Manufacturing + and ERP Capital Projects Supports Increased Data Flows Engineering Operating Efficiencies Project Management Fixed Cost Leverage…
Recruiting and Development Program Successfully Eliminates Labor Constraints 177,972 Applications processed 2013-2017 (35,800 Applications in 2017) 1,200 1,400 Screened candidates in the system 100+ drilling rigs…
Precisions Super Series Investments Drive Market Share Gains 3.0 Billion in Drilling Expansion and Peak 2018 U.S. Rig Count as % of 2014 Peak Upgrade Capital Investment from 2011 2017 Month Average 3 2014 Peak 1,2 Month 101 72 192…
PRECISION SUPER TRIPLE Advanced Rig Technology 1 25,000 + FT RACKING CAPACITY 2 PROCESS AUTOMATION CONTROL (APPS)* 3 DRILLING EQUIPMENT CONTROL SYSTEM* 6 4 HIGH SPEED DOWNHOLE DATA* 5 OMNI-PAD WALKING SYSTEM 6 825,000 LBS…
COMMERCIALIZE RIG AUTOMATION Reinforce Precisions High Performance competitive advantage by deploying Process Automation Controls, Directional Guidance Systems and Drilling Performance Applications on a wide scale commercial basis 13
PRECISION TECHNOLOGY BUILDING BLOCKS RIG AUTOMATION TOP DRIVE MUD PUMPS DIRECTIONAL GUIDANCE SYSTEM PROCESS AUTOMATION CONTROL Steering instructions generated Automates repetitive drilling using algorithms and real-time…
Technology Update NOVOS installed on 33 rigs including training rigs in Nisku and Houston Drilled 290 wells year-to-date1 in 2018 utilizing PAC Drilled 2.5 million feet on 100 DGS wells year-to-date1 Deploying revenue…
PROCESS AUTOMATION CONTROL Consistent, Predictable, Repeatable Experienced Driller Minutes Process Automation Control 41% Overall Time Savings PER CONNECTION Minutes Precision data from Rig 601 field trials 16
Consistent, Predictable, Repeatable Well Results Automation improves well times and reduces variation For PD strong utilization, incremental revenue and competitive advantage 13 14 17 TIME (DAYS) 4 DAYS 17
Technology Commercialization Revenue Potential REINFORCED COMPETITIVE REVENUE IMPACT FLEET PULL THROUGH ADVANTAGE New technologies will Each technology is a service strengthen competitive Pull through on existing rigs and sold to…
FINANCIAL PERFORMANCE Enhance financial performance through higher utilization and improved operating margins 19
UNITED STATES Focused on Market Share Growth, Cash Flow Growth ACTIVE RIG COUNT GROWTH MARKET SHARE1 24% PRECISION DRILLING U.S. 100 PD trough to current up 260% 1,200 2010 22% versus Lower 48 up 170% 80 20% 2017 900 18% 60…
CANADA Focused on Cash Flow SUPER SERIES FLEET STRONG FREE CASH FLOW GENERATION 128 Tier 1 Rigs INDUSTRIALIZED DRILLING EFFICIENCY Generated 1.8 billion in free cash flow since 20101 156 252 Virtually no upgrade capital spending…
INTERNATIONAL Stable Cash Flow in Low Cost Region ESTABLISHED SCALE IN THE MIDDLE EAST REGION 8 RIGS CURRENTLY UNDER CONTRACT 6 NEWBUILD RIGS DEPLOYED SINCE 2014 INCLUDING TWO IN Q4/16 17 TOTAL RIGS DEPLOYED INTERNATIONALLY…
Revenue and Cash Flow Visibility and Stability 2017 TOP 50 CUSTOMERS1 PUBLIC CUSTOMER BASE 72% Primarily public, large private, and national oil companies PRIVATE Average market capitalization of 48 billion 24% (median 11…
PRECISION WELL SERVICING High Performance Well Service Operations Focused on Cash Flow Largest service rig provider in the WCSB and established presence in the U.S. Ideally suited to address maintenance, optimization and completion…
REDUCE DEBT WITH FREE CASH FLOW Reduce debt by generating free cash flow while continuing to fund only the most attractive investment opportunities 25
2019 CAPITAL PLAN Strict Financial Discipline PLANNED 2019 CAPEX MAINTENANCE, INFRASTRUCTURE & EXPANSION & UPGRADES INTANGIBLES TOTAL: 53M 94M 169M 116M Maintenance spend highly correlated Kuwait new build rig 68 mm to…
Financial Performance RESILIENT MARGINS THROUGH THE DOWNTURN Aggressive cost management Fiscal Fiscal 2017 2016 (in millions) Rig contract performance Revenue 1,321 1,003 EBITDA 305 228 Premium day rates Margin 23% 23% 180…
Creating Shareholder Value HIGH PERFORMANCE SUPER SERIES FLEET MARKET SHARE GAINS & PREMIUM PRICING DRIVE FINANCIAL PERFORMANCE CASH FLOW GENERATION FOR DEBT REPAYMENT AND ENHANCED EQUITY VALUE 29
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