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Press release from CNW Group

Trinidad Drilling Ltd. Reports Solid Third Quarter 2012 Results; Industry-leading Activity Levels, Stable Adjusted EBITDA

Wednesday, November 07, 2012

Trinidad Drilling Ltd. Reports Solid Third Quarter 2012 Results; Industry-leading Activity Levels, Stable Adjusted EBITDA21:00 EST Wednesday, November 07, 2012/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/TSX SYMBOL:  TDG CALGARY, Nov. 7, 2012 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or "the Company") reported solid third quarter and year-to-date 2012 results. Trinidad's adjusted EBITDA (1) in the third quarter was in line with the same quarter last year and above the levels recorded in the second quarter of 2012. Year to date, adjusted EBITDA grew in the first nine months of 2012 when compared to the prior year. Trinidad's solid third quarter and year-to-date 2012 performance was a result of higher dayrates driven by strong demand present in the second half of 2011 and first half of 2012, partially offset by the impact of softening industry conditions in the third quarter."While we have seen a weakening in market conditions from the strength we saw in the first half of 2012, commodity prices still remain at levels that drive steady activity in the drilling industry," said Lyle Whitmarsh, Trinidad's Chief Executive Officer. "Our third quarter results demonstrate the strength of our business model and although we are not immune to the overall market conditions, our modern, high tech equipment, solid contract base and growing financial flexibility position us well to continue to outperform the industry as a whole."(1) Please see the Non-GAAP Measures Definitions section of this document for further details.FINANCIAL HIGHLIGHTS  Three months ended September 30,Nine months ended September 30,($ thousands except share and per share data)20122011% Change20122011% ChangeRevenue (3)207,716 196,7905.6630,864 570,77410.5Revenue, net of third party costs194,790 184,1075.8589,817 527,90511.7Gross margin (1)79,895 81,486(2.0)249,872 218,85314.2Gross margin percentage (1, 3)38.5%41.4%(7.0)39.6%38.3%3.4Gross margin - net percentage (1)41.0%44.3%(7.4)42.4%41.5%2.2EBITDA (1)64,714 76,017(14.9)209,035 180,99415.5 Per share (diluted) (2)0.54 0.63(14.3)1.73 1.5015.3Adjusted EBITDA (1)68,387 69,383(1.4)213,682 178,07520.0 Per share (diluted) (2)0.57 0.57-1.77 1.4720.4Cash provided by operations19,743 33,654(41.3)183,344 140,23430.7 Per share (basic / diluted) (2)0.16 0.28(42.9)1.52 1.1631.0Funds provided by operations51,659 44,93615.0174,324 144,15520.9 Per share (basic / diluted) (2)0.43 0.3716.21.44 1.1921.0Net earnings19,950 30,169(33.9)67,284 51,16331.5 Per share (basic / diluted) (2)0.17 0.25(32.0)0.56 0.4233.3Adjusted net earnings (1)24,913 23,5355.980,740 57,23741.1 Per share (basic / diluted) (2)0.21 0.1910.50.67 0.4742.6Capital expenditures net of dispositions39,428 36,9026.8146,436 72,216102.8Dividends declared6,043 6,043-18,129 18,129-Shares outstanding - basic / diluted       (weighted average) (2) 120,859,476   120,859,109-  120,859,476   120,853,781-        As at     September 30,December 31, ($ thousands except percentage data)   20122011 % Change Total assets   1,611,220 1,608,1260.2Total long-term liabilities   634,568 666,717(4.8)       (1)     Readers are cautioned that Gross margin, Gross margin percentage, Gross margin - net percentage, EBITDA, Adjusted EBITDA, Adjusted net earnings and the related per share information do not have standardized meanings prescribed by IFRS - see "Non-GAAP Measures".(2)     Basic shares include the weighted average number of shares outstanding over the period.  Diluted shares include the weighted average number of shares outstanding over the period and the dilutive impact, if any, the number of shares issuable pursuant to the Incentive Option Plan.(3)     Revenue has been recalculated in the prior year based on changes in presentation - see "Change in Presentation".OPERATING HIGHLIGHTS           Three months ended September 30, Nine months ended September 30,  20122011% Change 20122011% ChangeLand Drilling Market        Operating days (1, 2)         Canada 3,233 3,675(12.0) 8,628 9,680(10.9)  United States and International5,038 5,579(9.7) 15,589 15,837(1.6)Rate per operating day (1, 3, 4)         Canada (CDN$)23,501 20,31515.7 24,112 20,46217.8  United States and International (CDN$)22,518 18,60021.1 22,344 18,30422.1  United States and International (US$)22,263 19,14316.3 22,192 18,72118.5Utilization rate - operating day (1, 3, 5)         Canada 62%74%(16.2) 57%64%(10.9)  United States and International81%92%(12.0) 85%90%(5.6)Number of drilling rigs at quarter end         Canada 57 545.6 57 545.6  United States and International68 663.0 68 663.0  Utilization rate for service rigs (6)- -- - 51%-  Number of coring and surface casing rigs        at quarter end20 20- 20 20-Barge Drilling Market          Operating days (1, 2)376 454(17.2) 1,169 1,335(12.4)  Rate per operating day (CDN$) (1, 3, 4)30,008 24,83320.8 28,244 23,18721.8  Rate per operating day (US$) (1, 3, 4)29,583 25,54715.8 28,044 23,70518.3  Utilization rate - operating day (1, 5)82%99%(17.2) 85%98%(13.3)  Number of barge drilling rigs at quarter end2 2- 2 2-  Number of barge drilling rigs under Bareboat       Charter Agreements at quarter end3 3- 3 3-(1)     Operating days, utilization rate - operating day and rate per operating day have been recalculated, see "Change in Presentation".(2)     Operating days include drill days and move days.(3)     Rate per operating day includes operating revenue divided by operating days.(4)     Operating revenue is presented net of third party costs.(5)     Utilization rate - operating day is based on operating days divided by total days available.(6)     In the second quarter of 2011, Trinidad disposed of its 22 well servicing rigs and related equipment.OVERVIEWTrinidad recorded solid results in the third quarter of 2012; however, stronger revenue levels driven by higher dayrates were offset by lower operating days and higher repairs and maintenance expenses, leaving adjusted EBIDTA largely in line with the same quarter last year. Record performance in the first two quarters of 2012 drove higher revenue, gross margin and adjusted EBITDA in Trinidad's year-to-date results compared to the same period last year.Net earnings in the quarter lowered from the same quarter last year largely as a result of higher share-based compensation, an impairment recorded on property and equipment and the absence of a foreign exchange gain, partially offset by lower income taxes. Year to date, net earnings increased due to higher adjusted EBITDA partially offset by the absence of gains on foreign exchange and the sale of assets and higher income taxes.Third quarter revenue, adjusted EBIDTA and net earnings were higher than the second quarter of 2012 largely due to the end of spring break-up in Canada and added contributions from this segment as rigs went back to work.During the third quarter of 2012, crude oil prices weakened as ongoing concerns around European debt levels and slow global economic recovery put downward pressure on oil prices. On average during the quarter, crude oil prices remained at healthy levels; however, a drop below US$80 per barrel in late June caused a pullback in oil and gas development across North America as oil and gas producers chose to delay capital spending and take a cautious approach to their drilling programs. The strong movement away from natural gas drilling over the past few years has begun to have an impact on supply levels and the level of natural gas in storage has begun to drop towards more normal levels. This improvement in pricing is positive; however, natural gas prices still remain below the level that drives strong development activity for natural gas plays.INDUSTRY STATISTICS          201220112010 Q3Q2Q1Q4Q3Q2Q1Q4Commodity Prices        WTI crude oil price (US$ per barrel)  92.15  93.30  102.99  94.02  89.49  102.02  94.07  85.16Henry Hub natural gas price (US$ per mmBtu)2.882.292.433.334.124.374.183.80         US Industry Activity        Average US industry active land rig count (1)  1,837  1,9021,929  1,954  1,8931,778  1,674  1,648Average Trinidad active land rig count (2)5558586061575754         Canadian Industry Activity        Average Canadian industry utilization (3)42%18%65%54%54%23%66%49%Average Trinidad utilization (4)58%24%77%69%69%31%80%65%1)     Baker Hughes rig counts (information obtained from Tudor Pickering Holt & Company weekly rig roundup report).(2)     Includes US and international rigs, excludes rigs that are idle but contracted.(3)     Canadian Association of Oilwell drilling Contractors (CAODC) utilization.(4)     Based on drilling days (spud to rig release dates), excludes rigs that are idle but contracted.During the third quarter, industry activity levels reflected the softening demand as the number of active rigs in the US dropped slightly and utilization levels in Canada were slower to ramp up after spring break-up. While Trinidad was impacted by these industry conditions, the Company's modern, high performance equipment and strong contract position allowed it to continue to outperform the industry average activity levels.Trinidad's dayrates in the third quarter and year to date in 2012 increased from the levels recorded in the same periods last year driven by stronger demand across North America year over year. When compared to the second quarter of 2012, dayrates decreased as market conditions softened in the third quarter, combined with a shift in the Company's active rig mix after spring break-up.Trinidad remains committed to its leverage reduction strategy and further reduced its Total Debt to EBITDA ratio in the third quarter to 1.96 times. In order to meet its debt reduction targets, Trinidad has carefully managed its cost structure and its capital spending program by selecting projects that allow the Company to grow its business and continue as an industry leader, while also reducing its debt balances. Trinidad is moving towards its long-term leverage goal of Total Debt to EBIDTA of 1.50 times.Third quarter 2012 and year-to-date highlightsTrinidad generated revenue of $207.7 million for the third quarter and $630.9 million year to date, an increase of 5.6% and 10.5% from the same periods of 2011. Revenue grew in the quarter and year to date as a result of higher dayrates in each of the Canadian and the US and international operations and an increased fleet size. These factors were partially offset by a reduction in operating days in 2012 due to softening market conditions in the third quarter.Gross margin - net percentage was 41.0% in the quarter and 42.4% year to date, compared to 44.3% and 41.5%, respectively, in 2011. Gross margin - net percentage decreased from the same quarter last year due to higher repairs and maintenance expenses incurred in the US and international division. Higher year-to-date gross margin - net percentage levels were largely driven by strong results in the first two quarters of 2012 compared to the first nine months of 2011.Adjusted EBITDA was $68.4 million in the third quarter and $213.7 million year to date, down 1.4% and up 20.0%, respectively, from the same periods of 2011. Adjusted EBITDA was largely in line with the same quarter last year as the impact of higher dayrates and an increased fleet size was offset by lower operating days and higher operating costs. Year to date, adjusted EBITDA increased as a result of higher gross margin in the first nine months of 2012 and lower general and administrative costs (excluding share-based payments) compared to the same period in the prior year.Net earnings were $20.0 million ($0.17 per share (diluted)) for the quarter and $67.3 million ($0.56 per share (diluted)) year to date, down 33.9% and up 31.5%, respectively from the comparative periods in 2011. Net earnings lowered quarter over quarter as a result of higher share-based compensation, the absence of a foreign exchange gain and an impairment of property and equipment recorded in the quarter, partially offset by lower income taxes. Year to date, net earnings increased due to higher adjusted EBITDA partially offset by the absence of gains relating to foreign exchange and asset sales and higher income taxes.In the third quarter of 2012, Trinidad maintained its lower leverage level and recorded Total Debt to EBITDA of 1.96 times, compared to 2.42 times at year-end 2011 and 2.56 times at the end of the third quarter of 2011. Trinidad remains committed to lowering its leverage with a long-term target of 1.50 times.During the quarter, Trinidad added two newly built rigs to its Canadian operations, both under five-year, take-or-pay contracts.RESULTS FROM OPERATIONSCanadian Operations         Three months ended September 30, Nine months ended September 30,($ thousands except percentage and operating data)20122011% Change 20122011% ChangeOperating revenue (1, 2, 3, 4)77,155 74,5983.4 225,923 221,6851.9Other revenue51 107(52.3) 293 691(57.6) 77,206 74,7053.3 226,216 222,3761.7Operating costs (1, 2, 3, 4)43,276 42,9920.7 129,802 134,236(3.3)Gross margin33,930 31,7137.0 96,414 88,1409.4Gross margin - net percentage43.9%42.5%3.3 42.6%39.6%7.6        Drilling days3,004 3,434(12.5) 7,969 8,964(11.1)Operating days (1, 5)3,233 3,675(12.0) 8,628 9,680(10.9)Rate per operating day (CDN$) (1, 6)23,501 20,31515.7 24,112 20,46217.8Utilization rate - operating day (1, 7)62%74%(16.2) 57%64%(10.9)Utilization rate - drilling day (1, 8)58%69%(15.9) 53%59%(10.2)CAODC industry average (1, 9)42%54%(22.2) 41%47%(12.8)Number of drilling rigs at quarter end57 545.6 57 545.6         Utilization rate for service rigs (1, 10)- -- - 51%- Number of coring and surface rigs         at quarter end 20 20- 20 20-(1)     Operating revenue, operating costs, operating days, utilization rate - operating day and rate per operating day have been recalculated, see "Change in Presentation".(2)     Inter-segment revenue and operating costs of $4.6 million and $16.7 million has been excluded for the three months ended September 30, 2012 and 2011, respectively.  Inter-segment revenue and operating costs of $9.5 million and $42.9 million has been excluded for the nine months ended September 30, 2012 and 2011, respectively. Each of these inter-segment revenue and operating costs relates to rig construction for the US operations.(3)     External construction revenue and operating costs of less than $0.1 million and $0.2 million for the three and nine months ended September 30, 2012, respectively, are included in the above table. External construction revenue and operating costs of less than $0.1 million and $1.1 million for the three and nine months ended September 30, 2011, are included in the above table.(4)     Operating revenue and operating costs exclude third party recovery and third party costs of $8.7 million and $9.4 million for the three month period ended September 30, 2012 and 2011, respectively. Operating revenue and operating costs exclude third party recovery and third party costs of $27.7 million and $30.9 million have been excluded for the nine month period ended September 30, 2012 and 2011, respectively.(5)     Operating days include drill days and move days.(6)     Rate per operating day includes operating revenue divided by operating days.(7)     Utilization rate - operating day is based on operating days divided by total days available.(8)     Utilization rate - drilling day is based on drilling days divided by total days available.(9)     CAODC industry average is based on drilling days divided by total days available.(10)     In the second quarter of 2011, Trinidad disposed of all of its 22 well servicing rigs and related equipment.Trinidad's Canadian operations performed strongly in the third quarter and year-to-date 2012, which was reflected in higher revenues and improved gross margins compared to the same periods of the prior year. The strong performance was driven by higher dayrates carried over from the first half of 2012, which more than offset the lower activity levels in the current period. In addition, the increased rig count more than compensated for the impact of the sale of the Company's well service rigs in the second quarter of 2011.When compared to the second quarter of 2012, Canadian operations generated higher revenue and gross margin - net percentage as a result of the seasonality present in the Canadian drilling industry.The third quarter is typically representative of higher activity levels as spring break up is complete and road bans are lifted, allowing drilling to resume. Trinidad's high performance, modern fleet has consistently outperformed industry activity levels, with this trend continuing into the third quarter of 2012. During the quarter, Trinidad recorded average utilization that was 16 percentage points higher than the industry, strongly demonstrating the ongoing demand for the Company's equipment.A slower than expected increase in activity following spring break-up led to lower industry activity levels versus the same period of the prior year. Low natural gas prices and weakening crude oil prices caused a number of oil and gas producers to take a cautious approach to their remaining 2012 drilling programs. For Trinidad, the effect of this shift in the industry had a muted impact due to continued strong demand for Trinidad's higher specification rigs, as well as the Company's focus toward long-term, take-or-pay contracts.Dayrates increased in the third quarter of 2012 compared to the same period of 2011. Improved pricing was largely the result of high customer demand carried over from the first half of 2012, reflecting stronger market conditions year over year. The full impact of the higher dayrates was not reflected in the gross margin - net percentage as a portion of the increase was the result of higher crew wages from the fourth quarter of 2011; these costs are passed on to the operator at cost. In addition, in the current quarter and year to date, dayrates were higher by $432 per operating day and $483 per operating day, respectively, related to standby revenues. Standby revenues generate income but are not considered as operating days; therefore, increasing dayrates.When compared to the second quarter of 2012, dayrates decreased as a result of the change in the active rig mix as rigs returned to work following spring break-up.Gross margins in the current period and year-to-date 2012 were higher than the same periods of the prior year due to a higher rig count, increased dayrates carried over from the first half of 2012, as well as the Company's continued focus on cost containment. The positive margin impacts were slightly offset by the absence of the well servicing assets in the current periods, and the impact of lower operating days. These factors also drove higher gross margin - net percentages in both the current quarter and year-to-date 2012, compared to the same periods in 2011. Gross margin and gross margin - net percentage have increased when compared to the second quarter of 2012 due to the end of spring break-up and the return to normalized activity levels.Trinidad's active rig fleet increased by three rigs in the current period versus the same period of 2011, as one new build was delivered from the Company's manufacturing division in the second quarter of 2012, and two new builds were added to the fleet during the third quarter of 2012.By comparison, in the first three quarters of 2011, the construction operations delivered one rig per quarter into the US operations.  In addition, they continued construction on the two new builds that were added in early 2012.In the third quarter of 2012, the construction operations continued work on Trinidad's four remaining new builds. The Company expects two rigs to be delivered in the fourth quarter of 2012, with the remaining two rigs delivered in the first half of 2013.United States and International Operations         Three months ended September 30, Nine months ended September 30,($ thousands except percentage and operating data)20122011% Change 20122011% ChangeOperating revenue (1, 2)117,825 109,3647.7 363,828 305,18819.2Other revenue(241)38(734.2) (227)341(166.6) 117,584 109,4027.5 363,601 305,52919.0Operating costs (1, 2)71,619 59,62920.1 210,143 174,81620.2Gross margin45,965 49,773(7.7) 153,458 130,71317.4Gross margin - net percentage39.1%45.5%  42.2%42.8%          Land Drilling Rigs        Drilling days4,355 4,957(12.1) 13,495 14,237(5.2)Operating days (1 ,3)5,038 5,579(9.7) 15,589 15,837(1.6)Rate per operating day (CDN$) (1, 4)22,518 18,60021.1 22,344 18,30422.1Rate per operating day (US$) (1, 4)22,263 19,14316.3 22,192 18,72118.5Utilization rate - operating day (1, 5)81%92%(12.0) 85%90%(5.6)Utilization rate - drilling day (1, 6)70%82%(14.6) 74%81%(8.6)Number of drilling rigs at quarter end68 663.0 68 663.0         Barge Drilling Rigs        Operating days (3)376 454(17.2) 1,169 1,335(12.4) Rate per operating day (CDN$) (1, 4)30,008 24,83320.8 28,244 23,18721.8 Rate per operating day (US$) (1, 4)29,583 25,54715.8 28,044 23,70518.3Utilization rate - operating day (1, 5)82%99%(17.2) 85%98%(13.3) Number of barge drilling rigs at quarter end 2 2- 2 2- Number of barge drilling rigs under        Bareboat Charter Agreements at quarter end 3 3- 3 3-        (1) Operating revenue, operating costs, operating days, utilization rate - operating day and rate per operating day have been recalculated, see "Change in Presentation".(2)     Operating revenue and operating costs exclude third party recovery and third party costs of $4.2 million and $3.3 million for the three months ended September 30, 2012 and 2011, respectively; and $13.3 million and $12.0 million for the nine months ended September 30, 2012 and 2011, respectively.(3)     Operating days include drill days and move days.(4)     Rate per operating day includes operating revenue divided by operating days.(5)     Utilization rate - operating day is based on operating days divided by total days available.(6)     Utilization rate - drilling day is based on drilling days divided by total days available.Market conditions remained strong in the first half of 2012 in Trinidad's US and international operations when compared to the same period of the prior year; however, softening market conditions led to reduced industry activity levels in the current quarter. While the shift in industry demand reduced Trinidad's activity in the third quarter, it had a muted impact on the Company's operations due to Trinidad's continued focus towards in-demand, higher specification equipment, combined with the its high concentration of long-term, take-or-pay contracts.Strong industry demand for Trinidad's modern, high performance equipment led to upward momentum on dayrates in the first half of the current year with dayrates in the third quarter and year-to-date of 2012 showing improvement over the same periods of the prior year. The full impact of these dayrate increases was not reflected in the gross margin - net percentage as a portion of the increase was related to higher crew wages, which are passed onto the operator at cost. In addition, in the current quarter and year to date, the Company recorded higher standby revenue versus the same periods of the prior year, which increased dayrates as revenue is incurred with no associated operating days. Overall, dayrates on a per-rig basis did not change versus the second quarter, while the average fleet dayrate was marginally impacted by lower standby revenue in the current period, partially offset by a shift in rig mix towards higher specification equipment. In the current quarter and year to date in 2012, dayrates were higher by US$778 per operating day and US$1,030 per operating day, respectively, related to standby revenues.Although revenues remained strong, the gross margin and gross margin - net percentage levels showed a decline in the third quarter when compared to the prior year and prior quarter. Gross margins decreased largely due to higher operating costs in the current period as the Company took the opportunity to complete maintenance work on equipment during this period of lower activity, which had not been possible in prior periods. In addition, Trinidad is adapting to a shift in customer activity among plays, which has had a slightly negative impact on margins due to shorter well drilling times and more move days. Lastly, in the first half of 2011, Trinidad received one-time demobilization revenue that positively impacted the gross margin. Trinidad does not count standby and demobilization in the operating day statistics, which increases dayrates.Utilization levels in the third quarter and year-to-date 2012 lowered from the levels experienced in 2011, as well as the first and second quarters of 2012. During the third quarter, Trinidad experienced a decrease in operating days for its spot market equipment as a result of the current uncertainty in relation to commodity prices. In addition, in the current periods there was an increase of rigs under standby versus the same periods of the prior year which reduced utilization levels in the current period.Trinidad's land drilling rig count increased by two rigs on a net basis as at September 30, 2012, when compared to the same period of 2011. Four rigs were delivered into the US operations in the first half of 2012; each of these rigs were purchased externally and retrofitted to meet the Company's specifications. Additionally, two rigs were removed from the Company's marketable fleet at year-end 2011.  These two rigs are being assessed for sale or possible retrofit to meet current customer demands and Trinidad's target fleet mix. All four rigs delivered into service in 2012 were delivered into the Niobrara shale area in Wyoming.The Company's barge drilling operations continued to perform well, with quarter-over-quarter as well as year-over-year dayrate increases.  Higher dayrates for these operations are a reflection of the solid demand and limited supply of high quality equipment in this sector.  However, operating days and utilization levels were negatively impacted during the current quarter due to logistical delays as a result of hurricane Isaac.QUARTERLY ANALYSISFINANCIAL HIGHLIGHTS - QUARTERLY ANALYSIS           2012  2011 2010($ millions except per share data and operating data) Q3  Q2  Q1  Q4  Q3  Q2  Q1  Q4 Revenue207.7 167.6255.6226.5196.8149.7224.3194.4Gross margin (1)79.9 65.8104.288.881.552.684.776.7Gross margin percentage (1)38.5%39.3%40.8%39.2%41.4%35.2%37.8%39.4%Gross margin - net percentage (1)41.0%41.2%44.3%42.4%44.3%37.8%41.4%43.0%         Net earnings (loss) for the year20.0 12.934.525.330.25.016.0(84.8)  Adjustments for:           Depreciation and amortization 30.4 25.828.129.128.625.429.627.7   Foreign exchange 0.8 (0.7)0.52.4(6.1)(1.2)1.80.5   Loss (gain) on sale of property and equipment - (0.5)0.2(0.6)(0.1)(5.3)-0.4   Impairment of property and equipment 1.3 -7.5--9.0-24.9   Impairment of intangible assets and goodwill - ------59.1   Finance costs 10.3 10.510.810.910.910.512.436.2   Income taxes 2.7 4.410.24.86.4(3.4)5.9(2.2)   Other 2.9 1.00.12.5(0.5)(0.9)4.01.7   Income taxes paid (1.1)(0.7)(0.7)-(4.5)(0.9)(2.4)(0.4)   Income taxes recovered 3.9 --0.81.5-0.2-   Interest paid (19.5)(1.5)(19.8)(1.6)(21.4)(3.3)(3.1)(25.7)   Interest received - -------Funds provided by operations51.7 51.271.473.645.034.964.437.4Net earnings (loss) per share (diluted)0.17 0.110.290.210.250.040.13(0.70)Funds provided by operations per share (diluted)0.43 0.420.590.610.370.290.530.31(1)     See the Non-GAAP Measures Definitions section of this document for further details.NON-GAAP MEASURES HIGHLIGHTS - QUARTERLY ANALYSIS           2012  2011 2010 ($ millions except per share data and operating data)  Q3  Q2  Q1  Q4  Q3  Q2  Q1  Q4 EBITDA (1)64.7   53.1   91.2  69.5  76.0  41.2  63.8  61.5 Per share (diluted) (2)0.54   0.44   0.75  0.58  0.63  0.34  0.53  0.51Adjusted EBITDA (1)68.4   53.3   92.0  74.4  69.4  39.1  69.6  63.7 Per share (diluted) (2)0.57   0.44   0.76  0.62  0.57  0.32  0.58  0.53Adjusted net earnings (1)24.9   13.1   42.7  30.2  23.5  11.9  21.81.5 Per share (diluted) (2)0.21   0.11   0.35  0.25  0.19  0.10  0.18  0.01(1)     See the Non-GAAP Measures Definitions section of this document for further details.(2)     Diluted shares include the weighted average number of shares outstanding over the period and the dilutive impact, if any, the number of shares issuable pursuant to the Incentive Option Plan.OPERATING HIGHLIGHTS - QUARTERLY ANALYSIS             2012  2011 2010   Q3  Q2  Q1  Q4  Q3  Q2  Q1  Q4 Land Drilling Market         Operating days (1, 2)          Canada 3,233 1,2884,1073,6653,6751,6464,3593,522  United States and International5,038 5,2895,2625,5475,5795,1705,0884,958Rate per operating day (1, 3, 4)          Canada (CDN$)23,501 25,34324,20623,65220,31520,79620,45920,163  United States and International (CDN$)22,518 22,58621,93520,71018,60018,47017,81518,172  United States and International (US$)22,263 22,61621,69820,38719,14319,09517,87817,789Utilization rate - operating day (1, 5)          Canada 62%26%84%74%74%34%87%70%  United States and International81%86%90%92%92%89%90%82%Number of drilling rigs at quarter end          Canada 57 55545454545555  United States and International68 68666466656362  Utilization rate for service rigs (6)- ----34%66%57%  Number of service rigs at quarter end (6)- -----2222  Number of coring and surface casing         rigs at quarter end20 20202020202020          Barge Drilling Market           Operating days (1, 2)376 429364373454436445456  Rate per operating day (CDN$) (1, 3, 4)30,008 29,07225,44825,83524,83322,68022,00424,368  Rate per operating day (US$) (1, 3, 4)29,583 29,10625,20425,45525,54723,44122,08323,844  Utilization rate - operating day (1, 5)82%94%80%81%99%96%99%99%  Number of barge drilling rigs at quarter end 2 2222222  Number of barge drilling rigs under          Bareboat Charter at quarter end 3 3333333(1)     Operating revenue, operating costs, operating days, utilization rate - operating day and rate per operating day have been recalculated, see "Change in Presentation".(2)     Operating days include drill days and move days.(3)     Rate per operating day includes operating revenue divided by operating days.(4)     Operating revenue is presented net of third party costs.(5)     Utilization rate - operating day is based on operating days divided by total days available.(6)     In the second quarter of 2011, Trinidad disposed of its 22 well servicing rigs and related equipment.FINANCIAL SUMMARY      As atSeptember 30,December 31, ($ thousands except percentage data)20122011 $ Change Working capital (1)121,234 139,829(18,595)     Current portion of long-term debt611 58031Long-term debt (2)537,375 580,167(42,792)Total debt537,986 580,747(42,761)Total debt as a percentage of assets33.4%36.1%      Total assets  1,611,220 1,608,1263,094Total long-term liabilities634,568 666,717(32,149)Total long-term liabilities as a percentage of assets39.4%41.5%      Shareholders' equity879,211 841,22637,985Total debt to shareholders' equity61.2%69.0%  (1)     See Non-GAAP Measures Definition section of this document for further details.(2)     Long-term debt is net of associated transaction costs.At September 30, 2012, working capital decreased by $18.6 million from December 31, 2011. The lower level of working capital was driven by a collection of receivables, lower inventory reflecting materials utilized for rig construction during the period, and an increase in deferred revenue related to delay and early termination penalty revenues received to be amortized over the remaining periods of the relevant contracts. These factors were partially offset by higher prepaid expenses, an increase in assets held for sale due to the classification of a building in the US operations, as well as a decrease in accounts payable and accruals due to timing of payables in the third quarter of 2012 compared to the fourth quarter of 2011.Trinidad's total debt balance declined by $42.8 million during the current quarter when compared to the year ended December 31, 2011. During this period, Trinidad reduced its revolving credit facility balances by $28.6 million, combined with a decrease in the Senior Notes of $13.8 million as a result of the change in the US dollar foreign exchange rate at September 30, 2012, and a decrease in building and equipment loans of $0.4 million. The Senior Notes are translated at each quarter end, as such their value will fluctuate quarterly with variations in exchange rates.  The Senior Notes are due January 2019 and interest is payable semi-annually in arrears on January 15 and July 15.At September 30, 2012, Trinidad had CDN$104.0 million outstanding on its Canadian revolving credit facility and nil on its US revolving credit facility, leaving CDN$96.0 million and US$100.0 million unutilized in the facility, respectively.  The Canadian and US revolving facility requires quarterly interest payments that are based on Bankers Acceptance and LIBOR rates and incorporate a tiered interest rate, which varies depending on the results of the Consolidated Total Debt to Consolidated EBITDA ratio (see table below). The facility matures on December 16, 2015, and is subject to annual extensions of an additional year on each anniversary.A total of $149.1 million of capital expenditures were spent during the nine months ended September 30, 2012, compared to $116.0 million for the same period in the prior year.  Capital expenditures were substantially related to the Company's rig build program as well as upgrading the Company's fleet to meet customer demands.Trinidad expects cash provided by operations and the Company's various sources of financing to be sufficient to meet its debt repayments, future obligations and to fund planned capital expenditures.Current financial performance is well in excess of the financial ratio covenants under the revolving credit facility as reflected in the table below under IFRS:      RATIOSeptember 30,December 31, THRESHOLD  20122011        Consolidated Senior Debt to Consolidated EBITDA (1) 0.41:1  0.59:1   3.00:1 maximum Consolidated Total Debt to Consolidated EBITDA (1) 1.96:1  2.42:1   4.00:1 maximum Consolidated EBITDA to Consolidated Cash Interest Expense (1) 6.91:1  5.74:1   2.75:1 minimum (1)     Please see the Non-GAAP Measures Definition section of this document for further details.Readers are cautioned that the ratios noted above do not have standardized meanings prescribed in IFRS.OUTLOOKThe first nine months of 2012 have shown improved performance for Trinidad over the same time period in 2011. The strength in the first two quarters of the year began to tail off in the third quarter of 2012 and market conditions have remained soft to date in the fourth quarter of 2012. Activity levels in both Canada and the US, while still strong, are at lower levels than this time last year. Trinidad anticipates that softer market conditions will continue through the fourth quarter of 2012 and potentially into 2013.Trinidad's business model is well formulated to perform strongly in the cyclical drilling industry.  More than three quarters of the Company's fleet is considered high performance with high mobility and advanced drilling controls. Oil and gas producers are increasingly becoming aware of the importance of efficient, modern equipment and Trinidad's established reputation as a high performance driller gives it an advantage in this environment.In addition, Trinidad's high proportion of long term contracts provides a meaningful level of revenue protection. Trinidad currently has approximately 60.0% of its fleet under long-term, take-or-pay contracts with an average term remaining of 1.5 to 2.0 years. The Company has expanded its customer base over the past year, reducing customer concentration while also adding new customers with broad development opportunities.  The combination of relevant, adaptable equipment and a solid, largely contracted customer base allows Trinidad's equipment to maintain more stable activity levels despite softening market conditions.To date in 2012, Trinidad has completed six rigs from its 2011 capital program and two of the five new builds planned for construction in 2012. In addition, the Company has been focusing on upgrading existing equipment to ensure it remains marketable in an increasingly competitive industry. Trinidad has shown a disciplined approach to capital spending and a commitment to reaching its leverage goals for a number of years. In the third quarter, Trinidad maintained its Total Debt to EBITDA level below 2.00 times and remains committed to its leverage reduction strategy. The Company sees a clear path to meeting its long-term goal of Total Debt to EBITDA of 1.50 times. Trinidad will continue to carefully balance its growth program with its debt reduction strategy while also reviewing alternative ways of adding value for shareholders.In the near term, Trinidad expects to see ongoing weakness for older style, mechanical rigs and increasing competition for work in high demand areas, such as the Bakken and the Eagle Ford. While there has been some pull back in utilization over the past few months, current commodity prices drive healthy levels of activity. Trinidad expects that as producers have new capital budgets to put to work in 2013, the industry will show some improvement in activity levels.Trinidad is positioned to perform well in 2013 despite slightly weaker industry conditions. The Company's high contract base, in-demand equipment and expanded customer base allow it to have more steady activity and EBITDA levels than the industry as a whole. Looking further out, Trinidad's growing free cash flow position and lower leverage will allow the Company to take advantage of expansion opportunities both within North America and internationally.CONFERENCE CALLA conference call and webcast to discuss the results will be held for the investment community on Thursday Nov 8th, 2012 beginning at 9:00 a.m. MT (11:00 a.m. ET).  To participate, please dial (888) 231-8191 (toll-free in North America) or (647) 427-7450 approximately 10 minutes prior to the conference call. An archived recording of the call will be available from approximately 2:00 p.m. ET on Nov 8th, 2012 until midnight Nov 15th, 2012 by dialing (855) 859 2056 or (416) 849-0833 and entering replay access code 37904524.A live audio webcast of the conference call will also be available via the Investor Relations page of Trinidad's website.A full copy of Trinidad's third quarter 2012 report including Management's Discussion and Analysis, Consolidated Financial Statements and Notes to the Consolidated Financial Statements can be found on the Investor Relations page of Trinidad's website or at www.sedar.comTRINIDAD DRILLING LTD.Trinidad is a corporation focused on sustainable growth that trades on the Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in the drilling, 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.   CONSOLIDATED STATEMENTS OF FINANCIAL POSITION  As at September 30,December 31,($ thousands) - unaudited20122011   Assets  Current Assets  Accounts receivable 190,843 207,143Inventory10,938 17,523Prepaid expenses6,479 6,298Assets held for sale10,415 9,048 218,675 240,012   Property and equipment1,307,330 1,279,826Intangible assets and goodwill85,215 88,288 1,611,220 1,608,126   Liabilities  Current Liabilities  Bank indebtedness4,727 4,600Accounts payable and accrued liabilities 80,587 88,960Dividends payable6,043 6,043Deferred revenue5,473 -Current portion of long-term debt611 580 97,441 100,183   Long-term debt537,375 580,167Deferred income taxes97,193 86,550 732,009 766,900   Shareholders' Equity  Common shares952,043 952,043Contributed surplus50,032 49,462Accumulated other comprehensive income (loss)(37,117)(25,377)Retained earnings (deficit)(85,747)(134,902) 879,211 841,226 1,611,220 1,608,126      CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)      Three months endedNine months ended  September 30,September 30,($ thousands except per share data) - unaudited2012201120122011     Revenue    Oilfield service revenue207,906 196,645630,798 569,742Other revenue(190)14566 1,032 207,716 196,790630,864 570,774Expenses     Operating expense127,821 115,304380,992 351,921General and administrative14,371 11,61440,122 43,464Depreciation and amortization30,436 28,60284,383 83,595Foreign exchange 810 (6,145)715 (5,605)Loss (gain) on sale of property and equipment26 (63)(295)(5,416)Impairment of property and equipment1,290 -8,809 8,993 174,754 149,312514,726 476,952Finance costs10,288 10,93331,586 33,766Earnings before income taxes22,674 36,54584,552 60,056Income taxes     Current102 (454)66 2,712Deferred 2,622 6,83017,202 6,181 2,724 6,37617,268 8,893Net earnings19,950 30,16967,284 51,163     Other comprehensive income (loss)    Foreign currency translation adjustment, net ofincome tax(12,247)27,176(11,740)12,328 (12,247)27,176(11,740)12,328Total comprehensive income 7,703 57,34555,544 63,491     Earnings per share    Net earnings     Basic / Diluted0.17 0.250.56 0.42         CONSOLIDATED STATEMENTS OF CHANGES IN EQUITYFor nine months ended September 30, 2012 and 2011                  Accumulated       other Retained   CommonContributedcomprehensiveearningsTotal($ thousands) - unauditedsharessurplusincome (loss) (1)(deficit)equity       Balance at December 31, 2011952,043 49,462 (25,377)(134,902)841,226 Share-based payments- 570 - - 570 Total comprehensive income (loss)- - (11,740)67,284 55,544 Dividends- - - (18,129)(18,129)Balance at September 30, 2012952,043 50,032 (37,117)(85,747)879,211        Balance at January 1, 2011951,86349,016(30,030)(187,211)783,638Exercise of stock options180(48)--132Share-based payments-436--436Total comprehensive income (loss)--12,32851,16363,491Dividends---(18,129)(18,129)Balance at September 30, 2011952,04349,404(17,702)(154,177)829,568(1)Accumulated other comprehensive income consisted of foreign currency translation adjustment.   CONSOLIDATED STATEMENTS OF CASH FLOWS  For nine months ended September 30,  ($ thousands) - unaudited20122011   Cash provided by (used in)  Operating activities  Net earnings67,284 51,163Adjustments for:   Depreciation and amortization 84,383 83,595 Foreign exchange715 (5,605) (Gain) on sale of property and equipment (295)(5,416) Impairment of property and equipment 8,809 8,993 Finance costs 31,586 33,766 Income taxes 17,268 8,893 Other 3,924 2,640 Income taxes paid (2,542)(7,899) Income taxes recovered 3,953 1,785 Interest paid (40,769)(27,806) Interest received 8 46Funds provided by operations174,324 144,155Change in non-cash operating working capital9,020 (3,921)Cash provided by operations183,344 140,234   Investing activities  Purchase of property and equipment(149,114)(116,008)Proceeds from disposition of property and equipment2,678 43,792Change in non-cash working capital9,704 (7,924)Cash used by investing(136,732)(80,140)   Financing activities  Proceeds from long-term debt77,239 69,738Repayments of long-term debt(105,729)(100,160)Proceeds from exercise of options- 130Dividends paid(18,129)(18,128)Financing costs- (1,180)Cash used by financing(46,619)(49,600)   Cash flow from operating, investing and financing activities(7)10,494Effect of translation of foreign currency cash(120)(1,715)(Decrease) increase in cash for the period(127)8,779   (Bank indebtedness) cash and cash equivalents - beginning of period(4,600)7,905(Bank indebtedness) cash and cash equivalents - end of period(4,727)16,684 SEGMENTED INFORMATIONThe following presents the result of Trinidad's operating segments:      Three months ended    United States /  Inter-   September 30, 2012  Canadian  International   segment   ($ thousands)   Operations   Operations  Eliminations Corporate  Total  Operating revenue 77,155 117,825 - - 194,980  Other revenue 51 (241)- - (190) Third party recovery 8,705 4,221 - - 12,926  Inter-segment revenue 4,584 - (4,584)- -  90,495 121,805 (4,584)- 207,716  Operating costs 43,276 71,619 - - 114,895  Third party costs 8,705 4,221 - - 12,926  Inter-segment operating 4,584 - (4,584)- -  Operating income 33,930 45,965 - - 79,895  Depreciation and amortization 10,004 20,432 - - 30,436  (Gain) loss on sale of property and equipment 177 (151)- - 26  Impairment of property and equipment 1,290 - - - 1,290  Impairment of intangible assets and goodwill - - - - -  11,471 20,281 - - 31,752  Segmented income 22,459 25,684 - - 48,143  General and administrative - - - 14,371 14,371  Foreign exchange - - - 810 810  Finance costs - - - 10,288 10,288  Income taxes - - - 2,724 2,724  Net earnings (loss)22,459 25,684 - (28,193)19,950        Purchase of property and equipment 27,145 13,092 - - 40,237             Three months ended    United States /  Inter-   September 30, 2011  Canadian  International   segment   ($ thousands)   Operations   Operations  Eliminations Corporate  Total  Operating revenue 74,598109,364--183,962 Other revenue 10738--145 Third party recovery 9,3963,287--12,683 Inter-segment revenue 16,661-(16,661)-- 100,762112,689(16,661)-196,790 Operating 42,99259,629--102,621 Third party costs 9,3963,287--12,683 Inter-segment operating 16,661-(16,661)-- Operating income 31,71349,773--81,486 Depreciation and amortization 9,04219,560--28,602 (Gain) loss on sale of property and equipment 8(71)--(63) Impairment of property and equipment ----- Impairment of intangible assets and goodwill ----- 9,05019,489--28,539 Segmented (loss) income 22,66330,284--52,947 General and administrative ---11,61411,614 Foreign exchange ---(6,145)(6,145) Finance costs ---10,93310,933 Income taxes ---6,3766,376 Net earnings (loss)22,66330,284-(22,778)30,169       Purchase of property and equipment 14,30029,632--43,932            Nine months ended    United States /  Inter-   September 30, 2012  Canadian  International   segment   ($ thousands)   Operations   Operations  Eliminations Corporate  Total  Operating revenue 225,923 363,828 - - 589,751  Other revenue 293 (227)- - 66  Third party recovery 27,699 13,348 - - 41,047  Inter-segment revenue 9,499 - (9,499)- -  263,414 376,949 (9,499)- 630,864  Operating costs 129,802 210,143 - - 339,945  Third party costs 27,699 13,348 - - 41,047  Inter-segment operating 9,499 - (9,499)- -  Operating income 96,414 153,458 - - 249,872  Depreciation and amortization 25,371 59,012 - - 84,383  (Gain) loss on sale of property and equipment 224 (519)- - (295) Impairment of property and equipment 7,247 1,562 - - 8,809  32,842 60,055 - - 92,897  Segmented income 63,572 93,403 - - 156,975  General and administrative - - - 40,122 40,122  Foreign exchange - - - 715 715  Finance costs - - - 31,586 31,586  Income taxes - - - 17,268 17,268  Net earnings (loss) 63,572 93,403 - (89,691)67,284        Purchase of property and equipment 88,383 60,731 - - 149,114             Nine months ended    United States /  Inter-   September 30, 2011  Canadian  International   segment   ($ thousands)   Operations   Operations  Eliminations Corporate  Total  Operating revenue 221,685305,188--526,873 Other revenue 691341--1,032 Third party recovery 30,85712,012--42,869 Inter-segment revenue 42,850-(42,850)-- 296,083317,541(42,850)-570,774 Operating costs 134,236174,816--309,052 Third party costs 30,85712,012--42,869 Inter-segment operating 42,850-(42,850)-- Operating income 88,140130,713--218,853 Depreciation and amortization 26,52357,072--83,595 (Gain) loss on sale of property and equipment (4,163)(1,253)--(5,416) 23,89563,277--87,172 Segmented income 64,24567,436--131,681 General and administrative ---43,46443,464 Foreign exchange ---(5,605)(5,605) Finance costs ---33,76633,766 Income taxes ---8,8938,893 Net earnings (loss) 64,24567,436-(80,518)51,163       Purchase of property and equipment 32,12883,880--116,008 ADVISORYCHANGE IN PRESENTATIONEffective December 31, 2011, Trinidad changed the presentation of third party costs and recovery to be accounted for on a gross basis versus a net basis.  This presentation change provides the users of the consolidated interim financial statements and MD&A improved disclosure on the Company's operating segments; in addition, the presentation more accurately reflects the legal form of the contracts.  The change resulted in a reclassification of third party rental equipment costs, which were previously netted against revenue, to be presented on a gross basis as third party recovery and third party costs.  In addition, third party fuel costs, which were previously reported on a gross basis, have been reclassified to be included in third party recovery and third party costs.Additionally in the first quarter of 2012, the calculation of dayrates was changed to be based on operating revenue divided by operating days (drilling days plus move days), and now excludes third party recovery revenue as well as other income. Previously, only drilling days were included in the dayrate calculation. Furthermore, the Company began including additional disclosure in regards to utilization, adding utilization rate - operating day which is based on operating days instead of just the previously disclosed drilling day based utilization. The change in presentation of dayrates and utilization better aligns the Company's disclosure with its peers, and its management measurement tools.  Furthermore, the change allows the users of the financial statements a higher degree of disclosure.  See "Non-GAAP Measures Definitions" for calculations.  The changes in presentation have been applied retrospectively.NON-GAAP MEASURES DEFINITIONS This document contains references to certain financial measures and associated per share data that do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.  These financial measures are computed on a consistent basis for each reporting period and include gross margin, gross margin percentage, gross margin - net percentage, EBITDA, Adjusted EBITDA, Adjusted net earnings, working capital, Senior Debt to EBITDA, Total Debt to EBITDA, EBITDA to Cash Interest Expense, drilling days, operating days, utilization rate - drilling day, utilization rate - operating day, and rate per operating day.  These non-GAAP measures are identified and defined as follows under IFRS:"Gross margin" is used by management and investors to analyze overall and segmented operating performance.  Gross margin is not intended to represent operating income nor should it be viewed as an alternative to net earnings or other measures of financial performance calculated in accordance with IFRS.  Gross margin is calculated from the consolidated statements of operations and comprehensive income (loss) and from the segmented information contained in the notes to the consolidated interim financial statements and is defined as revenue less operating expenses."Gross margin percentage" is used by management and investors to analyze overall and segmented operating performance.  Gross margin percentage is calculated from the consolidated statements of operations and comprehensive income (loss) and from the segmented information in the notes to the consolidated interim financial statements and is defined as gross margin divided by revenue."Gross margin - net percentage" is used by management and investors to analyze overall and segmented operating performance.  Gross margin - net percentage is calculated from the consolidated statements of operations and comprehensive income (loss) and from the segmented information in the notes to the consolidated interim financial statements and is defined as gross margin divided by revenue net of third party costs."EBITDA" is a measure of the Company's operating profitability.  EBITDA provides an indication of the results generated by the Company's principal business activities prior to how these activities are financed, assets are depreciated, amortized and impaired, or how the results are taxed in various jurisdictions."Adjusted EBITDA" is used by management and investors to analyze EBITDA (as defined above) prior to the effect of foreign exchange and share-based payment expense, and is not intended to represent net earnings as calculated in accordance with IFRS."Adjusted net earnings" is used by management and the investment community to analyze net earnings prior to the effect of foreign exchange, share-based payments and impairment charges and is not intended to represent net earnings as calculated in accordance with IFRS."Working capital" is used by management and the investment community to analyze the operating liquidity available to the Company."Senior Debt to EBITDA" is defined as the consolidated balance of the revolving facility and other debt secured by a lien at quarter end to consolidated EBITDA for the trailing 12 months (TTM).  Consolidated EBITDA used in this financial ratio is calculated as EBITDA plus share-based payments and unrealized foreign exchange."Total Debt to EBITDA" is defined as the consolidated balance of long-term debt, which includes the Senior Debt, Senior Notes Payable and dividends payable at quarter end, to consolidated EBITDA for the TTM.  Consolidated EBITDA used in this financial ratio is calculated as EBITDA plus share-based payments and unrealized foreign exchange."EBITDA to Cash Interest Expense" is defined as the consolidated EBITDA for TTM to the cash interest expense on all debt balances for TTM.  Consolidated EBITDA used in this financial ratio is calculated as EBITDA plus share-based payments and unrealized foreign exchange."Drilling days" is defined as rig days between spud to rig release."Operating days" is defined as moving days (move in, rig up and tear out) plus drilling days (spud to rig release)."Utilization rate - drilling day" is defined as drilling days divided by total available rig days."Utilization rate - operating day" is defined as operating days (drilling days plus moving days) divided by total available rig days."Rate per operating day" is defined as operating revenue (net of third party costs) divided by operating days (drilling days plus moving days).References to gross margin, gross margin percentage, gross margin - net percentage, EBITDA, Adjusted EBITDA, Adjusted net earnings, working capital, Senior Debt to EBITDA, Total Debt to EBITDA, EBITDA to Cash Interest Expense, drilling days, operating days, utilization rate - drilling day, utilization rate - operating day, and rate per operating day throughout this document have the meanings set out above.FORWARD-LOOKING STATEMENTSThe 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 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.   SOURCE: Trinidad Drilling Ltd.For further information: Lyle Whitmarsh, Chief Executive Officer Brent Conway President Lisa Ciulka Vice President, Investor Relations Phone: (403) 294-4401 Fax: (403) 265-4168 Email: lciulka@trinidaddrilling.com