7130 South Lewis Avenue, Suite 1000, Tulsa, Oklahoma 74136
Telephone 918 493-7700, Fax 918 493-7714
Michael D. Earl
Vice President, Investor Relations
For Immediate Release…
UNIT CORPORATION REPORTS 2013 FOURTH QUARTER & YEAR END RESULTS
A PROMISING LOOK TO THE FUTURE
Tulsa, Oklahoma . . . Unit Corporation (NYSE - UNT) today reported its financial and operational results for the fourth quarter and year 2013.
Larry Pinkston, Unit’s Chief Executive Officer and President, stated “During 2013, the company continued to progress on several strategic initiatives. Our production in the fourth quarter increased 5% over the third quarter and overall production increased 18% year over year. Throughout the fourth quarter we increased the number of operated drilling rigs drilling for our oil and natural gas segment under our previously stated plans, and we initiated our pad drilling program in the Granite Wash. In our contract drilling segment, we completed the sale of five idle drilling rigs during the year, and we will place our first BOSS rig into service during the first quarter 2014. Our midstream segment continued to see the benefit of previous capital investments.”
“For the oil and natural gas segment, we are very pleased with our fourth quarter production growth. For the full year, we achieved the upper end of our production guidance. Fourth quarter production growth was primarily driven by the Wilcox and Granite Wash plays. During 2013, we completed sales of certain non-core oil and natural gas assets, with total proceeds of $78.8 million with the most significant portion coming from the sale of the majority of our non-operated Bakken assets. We ended 2013 with total proved reserves of 160 million barrels of oil equivalent (MMBoe), a 7% increase, despite the sale of non-core properties with total proved reserves of 3.5 MMBoe. Weather and operational delays will affect first quarter 2014 production; however, we continue to anticipate production growth for 2014 of between 15% and 18%.”
“Our contract drilling segment operated in a soft drilling market throughout 2013; however, we were able to maintain fairly consistent utilization. During the fourth quarter of 2013 we averaged 65 drilling rigs operating. We have seen improvement in utilization in the first quarter of 2014. Currently, we have 69 drilling rigs operating with continued improvement expected through the end of the first quarter. We also initiated a comprehensive evaluation of our drilling rig fleet that included a review regarding the possible realignment of our fleet’s capabilities and efficiencies. In view of the demand for drilling rigs using new technologies and capabilities, we determined we should pursue the sale of several of our older and larger drilling rigs that have not worked for some time. As a result, during 2013, we sold four of our idle 2,000 horsepower drilling rigs and one 3,000 horsepower drilling rig with proceeds totaling $32.4 million. In addition, the sale of four additional idle 3,000 horsepower drilling rigs was completed after year end. The proceeds from these sales will be used in our new drilling rig program, a program we launched to design and build a new proprietary drilling rig, the BOSS rig. We anticipate this drilling rig, coupled with continued enhancements to our existing fleet, will position us to continue to meet the demands of our existing customers and allow us to compete for the work of new customers. Our first BOSS drilling rig will work for our oil and natural gas segment during the first quarter of 2014. We are optimistic that the BOSS drilling rig will be well received by operators and will result in additional new-build contract opportunities.
The following information was filed by Unit Corp (UNT) on Tuesday, February 25, 2014 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.