A p u b l i c A t i o n o f

Spirit

ThePioneer

winter 2010

issue 3

Pioneer and its customer Whiting Oil and Gas Corporation work together to achieve optimum results.

Their success stems from two strategies, one intangible and the other tangible. The shared philosophy of “together-ness” is intangible but it is a contribut-ing factor to their combined success. The tangible strategy is called DWOP, which can refer to either Drill Well on Paper or the Drill Well Optimization Process.

“We are always looking for continuous improvement in safety and perfor-mance and the DWOP meetings are an excellent tool for Pioneer and Whiting,” explains F.C. “Red” West, Executive Vice President and President of Pioneer Drilling Services.

During these meetings, the focus centers on how to drill the perfect well, meaning drilling performance is safer, smarter, more efficient and everything is done right the first time. Those are tall orders but Pioneer and Whiting are joining forces to make it a reality.

Pioneer is drilling for Whiting in the Bakken play in the Sanish Field, Mountrail County, North Dakota, with PDC Rigs 56, 57, 66, 67. PDC Rig 44 and PDC Rig 3 will be de-ployed early in the second quarter

to North Dakota. PDC Rig 7 is also drilling for Whiting in Pioneer’s South Texas Division.

shared Philosophy“Pioneer and Whiting share the same philosophy,” says Doug Walton, Vice President and National Drilling Man-ager for Whiting Oil and Gas. “Both of our interests are best served when we act as one company, not two separate companies, meaning we share the same goals in one work environment. Whit-ing appreciates that Pioneer wants to work with the operator. Pioneer asks us “What can we do?” and that makes all the difference.”

Walton adds, “This is a refreshing approach. Pioneer and Whiting both see the benefits of a collaborative and safe environment. Having this level of trust is not only important, it is good business.”

DWoP meetingsDWOP meetings are usually held during rig moves and last about 6 hours. Ap-proximately 45 people attend, mainly

from Pioneer and Whiting, including drilling engineers, safety representatives, Toolpushers, rig crews and vendors.

A recent DWOP meeting was conducted with PDC Rig 56 in Stanley, North Dakota, near where the rig is currently drilling. PDC Rig 66 and PDC Rig 67 have already completed DWOP meetings.

Randy Smith Training Solutions as-sisted Whiting in the design and imple-mentation of the DWOP meetings.This particular session was conducted by Gary Nance, who has been conducting these meetings around the world for nearly five years.

technical limit time (tl)During DWOP meetings, a term fre-quently used is “technical limit time,” called the TL. One of the first tasks in the optimization process is to estimate the TL time to drill the perfect well, achieving the best possible perfor-mance.

For a perfect well, it is assumed that the team works with current technology,

working TogeTher for oPTimum reSulTS

continued on page 4

401(k) Match Is ReinstatedDon’t miss out on

this emPloyee beneFit because Pioneer values employee career

contributions to its success, we believe it’s

important to help employees achieve their

retirement goals.

For this reason, Pioneer is excited to

announce that it will resume the 401(k)

match. eligible employees have an excel-

lent opportunity to participate in Pioneer’s

401(k) Plan.

“We are excited to bring back the 401(k)

match for our eligible employees,” ex-

plains laura a. martinez, Director, human

resources. “employees are fortunate that

they work for a company that provides a

match for their 401(k) contributions and

contributes to their retirement goals. this

is a great opportunity to take advantage of

reducing the salary employees pay taxes

on, defer taxes on any investment gains

and benefit from Pioneer’s match to get

employees’ retirement savings off to a

great start.”

the match will begin in april, and will be a

50% match of the first 6% of an employ-

ee’s contribution. With different payrolls

processed, the match will be made on the

first paycheck in april for each division.

new enrollments are accepted, provided

the employee has met the 90-day waiting

period. changes to contributions/deferral

percentages are also being accepted.

contributions will be easy with payroll

deductions and contributions are on a pre-

tax basis.

to enroll or make any changes to an exist-

ing account, employees should contact

Fidelity investments, 800-294-4015.

For additional assistance with existing

accounts, employees can also contact the

Pioneer human resources Department,

210-870-2100.

in this issue:page 2 • east texas Divisionpage 3 • Wireline servicespage 3 safety Milestones•page 4 community support•

congratulations to PDc rig 56Following their first DWoP meeting during February 2010, PDc rig 56 drilled to a depth of 19,893 feet in 14 days 23 ½ hours, a new record for Whiting.

Whiting Oil and Gas representatives at the DWOP meeting were (l-r) Orion Skinner, Randy Anderson, Doug Walton, Kenneth Wilkerson III, Rich Brierley, Ilene Presworsky and Cole Orley.

PDC Rig 56 recently drilled a record well for Whiting.

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Build On Our Strengths

While we continue to face market chal-

lenges, there are some bright spots that

we already see in 2010.

We are experiencing an increase in

demand for our equipment, coming from

the increase in activity in the u. s. shale

plays and in colombia. our crews in the

Drilling services Division are hard at

work in the marcellus shale, the bakken

shale and other shale plays.

on the international front, we have

seven rigs operating in colombia and

we expect an eighth drilling rig to begin

operations soon.

We continue to expand well servicing

operations with our Production services

Division and we have well service rigs

operating in the bakken shale, Fayetteville

shale and haynesville shale. We recently

opened well servicing yards in laurel,

mississippi and in the eagle Ford shale.

this issue of the Pioneer spirit show-

cases just a few of the results of your

hard work, whether your achievements

are in safety, outstanding performance or

customer relationships.

We are very excited about PDc rig 56

drilling a record well for Whiting oil &

gas – a depth of 19, 983 feet in 14 days,

23 ½ hours – while working for Whiting

in the bakken play in north Dakota. our

cover article reviews the impressive re-

sults of our DWoP meetings and effective

collaboration with Whiting.

our goal is to work safely every day and

i know we are all proud when hard work

translates into significant milestones.

our PDc rig 25 is celebrating 5 years

Without an incident.

We are also excited about the potential

we see in our new wireline business

division that provides both onshore and

offshore services. (see page 3.)

these are just a few examples of the

strengths and standards that represent

the Pioneer spirit. beyond our premium

equipment, we have one constant that

drives these accomplishments: you. you

are the source of our strength. each one

of you is important. you bring value to our

organization and you bring value to each

other and to our customers.

i know that each of you is doing all

that you can to help our company move

forward and i thank you.

as we move forward, we are ready to

tackle challenges, welcome opportunities

and celebrate the strengths that distin-

guish Pioneer.

Pioneer Drilling’s East Texas Division has earned the status of being one of the most knowledgeable oil and gas teams in East Texas.

The East Texas team is responsible for the marketing and operation of 20 rigs and the group supports the rigs and drilling activities within a radius of 150 miles.

The team is proud of its many accom-plishments, but the latest recognition is focused on PDC Rig 25. The rig has achieved a safety milestone of 5 Years Without A Recordable Incident, a superior record that is applauded throughout the company and by its customer, Valence Operating Company. The rig has been working for Valence since it was built in 2003 and the rig’s safety record of 1940 days is among the best in the industry.

“We emphasize safety every day here,” explains Billy King, Vice President/Di-vision Manager who has 33 years in the industry.

King is excited about Pioneer’s overall strong position and he adds that safety is a major factor in the industry. “All of us at Pioneer made the commitment several years ago that our goal is zero incidents. We are extremely proud of our division, with its incident rate of less than 1 percent (.88).”

Family spiritMost of the team has worked together for more than 20 years, building a fam-ily spirit that sets a positive and produc-tive tone for the tough challenges they tackle each day. Their oilfield experi-ence is almost second to none in this part of the country.

“We’re like a family here and our strong relationships contribute to our success,” says King. “We have the ex-pertise, we work hard and we focus on getting the job done safely, but our core strength is our family spirit.”

He and Danny Bates, Marketing/Op-erations, have worked together for 30 years and they have long relationships with other team members such as 25 years with Drilling Superintendents Carl Russell and Michael Hunt and Marketing Representative Chuck Cline.

reasons to be Proud “We have excellent crews and staff and solid relationships with our customers,” comments King. “It is helpful when there is a productive give and take on the part of everyone, including the office, at the rig level and with the operator.”

“It takes a lot of hard work to accom-plish this safety record,” adds Bates.

“Success and quality are no accident. They come from a tremendous amount of teamwork and effort and a daily emphasis on safety.”

That teamwork is in action 24 hours a day, because like all Pioneer personnel, they have a commitment to maintain ongoing communication and services day and night.

“We have challenges every day,” Bates says, “but we have good leadership at the rig level. There are drilling chal-lenges because the rock is harder and you have to know formations. In fact, horizontal drilling is being used more frequently here.”

Randy Patterson, Valence Operating’s Project Engineering Consultant on-site, is proud of PDC Rig 25’s safety record. He points to the rig’s success as a result of crew quality, low turnover rate and the long relationship that Valence has with Pioneer and its personnel. “Work-ing with the same personnel enhances our relationship and we continue to build on our success here,” he says.

central locationThe East Texas Division is located in Henderson, Texas, centrally located and easily accessible to several major oil and gas plays in the area: Freestone to the west, Haynesville to the east and the Louisiana border to the south (near Lake Charles).

The Haynesville Shale is considered by many to be the largest natural gas field in the continental U.S. Pioneer’s strategy is to capitalize on multiple oil and gas plays in the United States and is doing so by entering the Haynesville market with PDC Rig 8. The rig is currently being upgraded with a top drive and other specifications to meet customer requirements.

The East Texas Division also includes a five-acre yard and has support services from Pioneer’s Trucking Yard in Kilgore, Texas.

“The success of our East Texas Division wouldn’t be possible,” King concludes, “without recognizing all of our families. We like to credit all of our family members who support us every day and they are a very important part

of Pioneer.”

eaST TexaS Team ProveS iT haS whaT iT TakeS

Wm. stacy locke President and ceo

PDc rig 25: uP close anD Personal PDc rig 25 is a top drive diesel

electric rig rated for 18,000 feet.

some of PDc rig 25’s seasoned

crew share their observations about

their career.

Driller C.J. Hardy – 2

years

“safety standards are

high. We want everyone

to go home safely so

before we do anything,

we stop to talk about how to safely

do it. use common sense and pay

attention. it’s a demanding job but

the salary and benefits are good. if

you work hard you can advance. i

like the six months off and i use it to

work on my family’s cattle ranch.”

Derrickman Mark nichols – 5 years

“this is a great career

with great benefits. i

enjoy working outside

and the time off lets me

have some quality time with my kids.

safety is a big part of what we do

and we watch out for each other and

we work well together.

Motorman David Grif-fith – 3+ years

“these are good people

to work for and they

treat me right. everyone

works together; and we

are like a family. you have to use

common sense regarding safety. i

want to go home safely to my wife

and 3 kids. “

Floorhand Chris north

– 8 years

“everyone wants to do

what is necessary to be

safe. that means help-

ing and looking out for

each other. We have become friends.

When i am home i enjoy spending

time with my daughter (brooke, 14)

and spoiling her!”

Floorhand elvin Hodge

- 1+ years

“i really like Pioneer.

everyone works as a

team and we trust each

other. this is a great

career with financial security and

plenty of time off. During my free

time i like to hunt and spend time

with wife.”

the team acknowledges that the suc-

cess of the rig and the crew would

not be possible without the contribu-

tions of the late melvin Janak sr.,

who was with the rig since it started

working.

Danny Bates (left) and Billy King.

Visiting PDC Rig 25 are (l-r) Randy Patterson, Chuck Cline, Billy King, Danny Bates, Ron Baxter, Michael Hunt, James Osteen, Carl Russell and Donald Wright.

Left to right are Staci Riley, Terri Bailey, Joyce Jones, Tami Newlen and Kelly Hodges.

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Pioneer’s new Gulf Coast Wireline Ser-vices group, which includes an offshore segment, is focused on niche markets in the Gulf Coast. The group has a com-petitive advantage which stems from its high level of expertise and state-of-the-art equipment.

The new division will serve not only the Gulf Coast offshore market but will also offer wireline services to land-based operators located in Louisiana, Mississippi, and East, Central, and South Texas.

“We are building a division with spe-cialized personnel and equipment,” explains Bill Bouziden, new division manager, “and this represents an excit-ing opportunity. We have a tremendous amount of knowledge to offer custom-ers as they attempt to remedy problem wells or to simply complete their wells for initial production.”

He adds, “In order for Pioneer to be successful, we will focus on the spe-cialty markets which will become the core of our business. We see emerg-ing markets in the Gulf Coast inland waters and offshore marketplace which, when coupled with a historically stable land-based activity, should lead to a strong growth pattern.”

The Gulf Coast area and parts of southern Texas have what are called exotic or hostile environments, with bottom hole temperatures that can reach 450F degrees and pressures near-ing 25,000 pounds.

These extreme downhole conditions require a tailored approach to perform-ing wireline services. “With the demand for specialty services in these environ-ments,” he says, “a high level of experi-ence is absolutely necessary to perform safely and efficiently on these wells.”

That experience status sets Pioneer apart from the other wireline service companies. “We have considerable experience with operations requiring enhanced capabilities above the normal approaches in the wireline business and we have the cream of the crop when it comes to personnel who can handle those challenges” adds Bouziden.

challenges require special equip-mentThe work is even more challenging when considering that a large part of the market serviced by this Division includes high angle and horizontal wells, some containing multi-lateral wellbores. Specialized hardware, operated by experienced personnel and followed by a proven track record, will be the key elements to success.

To mobilize equipment for offshore activities, all wireline units must be sectionalized to accommodate the transportation restrictions encoun-

tered when preparing to travel to wells located over water. These specialty units are uniquely designed to be com-pletely functional once they have been transported to offshore wellsites in their individual carrying state.

bright Future “I am optimistic about this industry,” adds Bouziden. “The United States will need increasing supplies of natural gas in the next 15 years and 20 percent of the natural gas production in the U.S. will come from the Gulf Coast.”

He concludes, “We’re talking with all the major clients in the Gulf Coast and all have indicated an interest in who we are and how we can be part of their solutions in maximizing the production

from their wells.”

we have a loT To offer

saFety milestones

congratulations to these rigs for reaching a major safety milestone of working time without record-able incidents.

Five yearsPDc rig 25

Four yearsPDc rig 17

PDc rig 32

PDc rig 33

three years

PDc rig 12

PDc rig 14

PDc rig 19

PDc rig 20

PDc rig 26

PDc rig 31

PDc rig 34

PDc rig 37

PDc rig 58

tWo yearsPDc rig 2

PDc rig 3

PDc rig 5

PDc rig 7

PDc rig 15

PDc rig 16

PDc rig 21

PDc rig 24

PDc rig 27

PDc rig 28

PDc rig 36

PDc rig 38

PDc rig 41

PDc rig 42

PDc rig 48

PDc rig 49

PDc rig 50

PDc rig 52

PDc rig 56

PDc rig 59

PDc rig 60

PDc rig 61

PDc rig 65

one year

PDc rig 4

PDc rig 6

PDc rig 9

PDc rig 10

PDc rig 11

PDc rig 18

PDc rig 22

PDc rig 23

PDc rig 29

PDc rig 30

PDc rig 35

PDc rig 39

PDc rig 40

PDc rig 43

PDc rig 45

PDc rig 47

PDc rig 53

PDc rig 54

PDc rig 64

PDc rig 66

PDc rig 301

PDc rig 302

PDc rig 303

New Gulf Coast team includes (l-r) Jesse Rivet, Bill Bouziden, Patricia DeJean, Troy Green and Pablo De La Garza.

The division has specialized personnel and equipment.

saFety is highest Prioritythe wireline service industry is

regulated by a number of agencies

at both the state and federal level.

this oversight includes the alcohol

tobacco, Firearms and explosives

Department, the nuclear regulatory

commission, the homeland security

administration, osha, Dot, mms,

ePa, and state bodies for regulatory

compliance in the use of radioac-

tive materials and explosives.

Pioneer Wireline services, in con-

cert with the philosophy of Pioneer

Drilling, is committed to the highest

level of standards to ensure a safe

workplace for all of its employees

both on land and on the sea.

saFety milestone For Pioneer Wireline services

Pioneer Wireline services celebrated 1 year Without an lta throughout its workforce.

congratulations to its 200 employees!

Pioneer recently updated its website, giving it a fresh, new appearance. Be sure to visit www.pioneerdrlg.com and learn more about Pioneer Drilling Services, Well Services, Wireline Services and Fishing and Rental

Services.

CheCk ouT our new webSiTe!Premium equiPment. the best PeoPle. unsurPasseD service.

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The Pioneer Drilling Company

newsletter is published by Pioneer

Drilling for our employees and

customers. Questions or comments

directed to Newsletter@pioneerdrlg.com

The online version of the newsletter can

be found on www.pioneerdrlg.com. A

Spanish version is available on request.

Pioneer Drilling Company

1250 N.E. Loop 410, Suite 1000

San Antonio, Texas 78209

www.pioneerdrlg.com

Editorial Committee

J. Blaine David, Joe Eustace, Tomas Avila,

Kenny Fernandez, Alma Green, Leanna

Khrystyuk, Greg Lakey, Laura Martinez,

Esteban Pereira, Jerry Rios

Editorial Coordination:

Wendy Cederberg

Design

MDesign

www.mdesignfreelance.com

Feast oF the heart 5K run/WalKPioneer was a proud sponsor of San An-tonio’s annual Raul Jimenez Thanksgiving Dinner 5K Run which raised funds for the Thanksgiving Dinner event held every year in San Antonio. During the Thanksgiv-ing Dinner event, warm holiday meals are served to approximately 25,000 senior citizens and the disadvantaged who are alone or unable to afford a holiday meal. Volunteers and their families raised funds and either ran or walked to complete the entire 5K distance. Team Pioneer consisted of Tayla Campbell and Joseph Gonzalez; Rudy Jr., Rudy and Andrea Ruiz; Leanna Khrystyuk and Siva Shanmugam; Marisa Martinez; Angelica Espinosa; Laura and Jonathan Martinez and Joe Eustace.

relay For liFePioneer supported the Relay for Life in Williston, North Dakota. Left to right are Amy Wells, representative for Relay for Life; J. Skip Locken, North Dakota Divi-sion Manager; Elizabeth Hughes, Human Resources, and Everl Johnson, Division Superintendent/HSE. Everl and his wife Sandy participated in the event.

we SuPPorT our CommuniTieSthanK you to all oF the Pioneer volunteers Who helP maKe our communities a little brighter.

PDc rig 56 Personnel

toolPushersvirgil borman

Francis (Zeak) geiger

Drillersrichard bratrsovsky

John rosencrans

Donn eisenhauer

clint carnes

Keegan Fred (assistant Driller)

motormenryan alderin

Dave Peterson

michael mcguire

shay hunt

garrett skavlem

DerricKmenWayne hellebust

Kenny vannatta

les holgate

tallon hoogeboom

FloorhanDsDavid maertens

todd stevenson

adam olson

tim tveter

Kris rolfe

Kevin charbonneau

ron carpenter

austin Dimmick

alex roubal

corey murphy

lyle Donoven

current knowledge, perfect conditions and has a flawless operation.

Four teams are organized, with about 11 people each and they are selected by job duties such as drilling, trucking and directional services. They analyze well sections to determine the best operating practice; online/offline prep work; logis-tics and potential problems.

Priority is always given to Safety and Incident Prevention.

important Discussion topicsParticipants are challenged to look at the well from start to finish and find if anything can be done better or safer. Be-cause many in the room have 20+ years in the industry, they are generating good ideas during the discussion.

One of the important topics is how to determine and eliminate Non Produc-tive Time. This could include weather delays and that happens in North Dakota, where temperatures can go down to -20F, accompanied by heavy snow.

The goal is to aim always for best practices. The groups review the entire work process for drilling, tripping, running casing, and implementation of new technology/meth-ods. Improvements can be made on flat time, reduction of non-productive time, and communication between crews.

During the meeting, the group becomes enthusiastic as they bounce good ideas among themselves. Final results and ideas are compiled in tally books for partici-pants and a large poster of each segment

will be hung in the rig’s dog house, Tool-pusher’s trailer and company man’s trailer.

safety goalSkip Locken, Pioneer’s Division Manager in North Dakota, adds, “It takes every-one being committed to the same goals. You can talk about safety and perfor-mance all day but you have to lead by example. If we all work together, we will have a safe productive workforce.”

Ilene Presworsky, Safety Coordinator at Whiting, told the group that “Pio-neer and Whiting share the same values about health and safety and returning home safely to our families. Whiting, in conjunction with Pioneer, looks at safety as the most important part of your job.” She asked the group “Who has primary responsibility for safety in your orga-nization?” and the group immediately responded, “Everyone.”

Walton adds that “Moving forward we will look at what is current performance, what is possible and what do we need to do to get there. PDC Rig 56 has a top notch crew, good iron and they put safety first. You can have the best equipment, but without the best people, it is meaningless.”

results better than expected“The buy-in and participation level exceeded our expectations,” adds Wal-ton, who has more than 27 years in the industry. “People are amazed at how we have improved drilling efficiency, lowered costs and improved safety in such a short time.”

Since the beginning of DWOP, drilling days from spud to TD have been reduced by over 11 days. In addition, there has been increased safety awareness, resulting in no OSHA recordable accidents and no LTAs for the last half of 2009 on any of Whiting’s drilling operations within the field.

According to Cole Orley, Drilling Engi-neer for Whiting, “It is very nice working with a company who likes to work with you.” He complimented the rig personnel for the excellent job they are doing. “You have consistency and that’s important.”

Summarizing the three wells drilled by PDC Rig 56 since October 2009, he noted the average number of days to to-tal depth was 19.95 days. Average drill times from spud to TD across all nine rigs drilling for Whiting in the field have dropped by over 11 days to just under 27 days.

“The faster we go from spud to rig release means a quicker revenue stream,” he notes.

“Now that we are gaining success with DWOP,” adds Walton, “we are beginning our second phase which includes finan-cial incentives to reward crews for their

performance.”

habitat for humanityVolunteers worked all day in San Antonio to help build a home for a low-income family who would not otherwise be able to afford a house. Volunteers were Greg Lakey, Carlos Pena, Esteban Pereira, Leanna Khrystyuk, Norma Pantoja, Bill Schneider and Tayla Campbell, with guest Joseph Gonzalez.

continued from page 1

Team members review each phase of the entire work process.

The team is divided into groups to look at the well from start to finish. This group enjoyed finding ways for improvement.

Esteban Pereira (left) and Carlos Peña volunteer for Habitat for Humanity.

Norma Pantoja is working hard for Habitat for Humanity.