Key Developments For Union Drilling, Inc.
Union Drilling, Inc. (UDRL.O) (Nasdaq)
Union Drilling, Inc. Enters Into Rig Construction Contract
Union Drilling, Inc. announced that it has entered into a construction contract with IDM Equipment, LLC of Houston, TX to provide a 1,600 horsepower AC Fast Moving Quicksilver Drilling System, principally for operations in Pennsylvania targeting the Marcellus Shale formation. The Company also has received the commitment of a long standing customer to execute a three year drilling contract upon the rig's delivery, which is expected in June 2008. The cost of the rig, including a top drive, an air circulation system for underbalanced drilling, tubulars, handling tools and crew quarters that are not being supplied by IDM, is approximately $17 million.
Union Drilling, Inc. Announces Resignation of Chief Financial Officer
Union Drilling, Inc. has announced that its Chief Financial Officer Dan Steigerwald will retire on June 1, 2007. A.J. Verdecchia will become Chief Financial Officer effective April 1, 2007.
Union Drilling, Inc. Exercises Option To Build Three New Rigs
Union Drilling, Inc. announced that it has exercised its option with National Oilwell Varco, L.P. to acquire three new 1,500 horsepower SCR IDEALTM rigs for $25.2 million. The Company paid $1 million for this option, which will be applied against the purchase price. With the addition of drill pipe, handling tools and other items not supplied by National Oilwell Varco, the Company estimates the total price per rig will be approximately $10 million. These new rigs will be deployed in the northern Texas Barnett Shale formation under multi-year contracts and are scheduled to be delivered during the fourth quarter of 2006. The exercise of this option follows the Company's previously announced purchase of three similar IDEALTM rigs on December 12, 2005. These rigs are scheduled for delivery in the second and third quarters of 2006 and also will be deployed into the Barnett Shale.
Union Drilling, Inc. Announces Agreements To Acquire Six Drilling Rigs From National-Oilwell, L.P.
Union Drilling, Inc. announced the execution of an agreement to acquire three Ideal Rigs from National-Oilwell, L.P. for an aggregate purchase price of $24 million and an option, which must be exercised by April 30, 2006, to acquire an additional three Ideal Rigs from National-Oilwell, L.P. for an aggregate purchase price of $25.2 million. The Company paid $1 million for the option, which will be applied against the purchase price if the option is exercised. The three Ideal Rigs subject to the purchase agreement are scheduled for delivery in March, May and June of 2006. The three Ideal Rigs subject to the option are scheduled for delivery, if the option is exercised, in September, October and November of 2006. The Company also took delivery of two newly constructed 185k top head drive rigs in November and early December 2005. These rigs will be deployed in the Southern Appalachian basin drilling for natural gas in CBM (Coalbed Methane) formations.
Union Drilling, Inc. Announces Pricing Of Initial Public Offering Of Common Stock
Union Drilling, Inc., a Delaware corporation, announced the pricing of its initial public offering of 8,823,530 shares of common stock at a price of $14.00 per share, half of which are being sold by the Company and half by selling stockholders. The Company's controlling stockholder has granted the underwriters an option to purchase up to an additional 1,323,530 shares of common stock to cover over-allotments, if any. The Company will not receive any proceeds from the sale of shares by the selling stockholders. The Company intends to use the net proceeds from the offering to repay indebtedness under its revolving credit facility (approximately $52 million as of November 18, which was incurred primarily to acquire Thornton Drilling Company, to acquire eight rigs from SPA Drilling L.P., and to acquire additional drilling rigs), approximately $5 million to upgrade its drilling rig fleet and purchase related equipment, and the balance for general corporate purposes. J. P. Morgan Securities Inc. is acting as sole book-running manager.
