Bank of America2007 Energy Conference
November 15, 2007
Robert L. Parker – Chairman & CEOKirk Brassfield – Sr. VP & CFO
Bank of America2007 Energy Conference
November 15, 2007
Robert L. Parker – Chairman & CEOKirk Brassfield – Sr. VP & CFO
Forward-Looking StatementsForward-Looking Statements
The following presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of the Securities Acts. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, the outlook for rig utilization and day rates, general industry conditions including bidding activity, future operating results of the Company’s rigs and rental tool operations, capital expenditures, income tax matters, expansion and growth opportunities, financing activities, debt repayment and other such matters, are forward-looking statements. Although the Company believes that its expectationsstated in this presentation are based on reasonable assumptions,actual results may differ materially from those expressed or implied in the forward-looking statements. For a more detailed discussion of risk factors, please refer to the Company’s reports filed with the SEC, and in particular, the report on Form 10-K for the year ended December 31, 2006. Each forward-looking statement speaks only as of the date of this presentation, and the Company undertakes no obligation to publicly update or revise any forward-looking statement.
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Company StatisticsCompany Statistics
• Market capitalization $0.95B• Enterprise value $1.18B• Exchange/Ticker NYSE: PKD• Trading volume 1.9M shares daily• Shares outstanding 111.71M• Institutional ownership 65%• Debt to total capitalization 41.6%
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Company OverviewCompany Overview
• Worldwide service company providing drilling, rental tool services and project management to the energy industry
Global Contract Drilling
• 3Q07 saw initial impact of new International contracts
• 11 new rigs delivered in late 2006 and 2007
• 2 newly designed International land rigs to be delivered in 2008
Quail Tools
• 2006/2007 organic expansion completed in third quarter 2007
• Record EBITDA in 3Q07
Project Management Services
• High-profile, technically challenging projects
• Revenues nearly tripled in 2006 vs. 2003
73-Years of Innovation73-Years of Innovation
• Founded 1934• 1965 – Drilled first 18,000+ foot well• 1969 – Patented Heli-Hoist® technology• 1972 – 28,500 foot depth record (Ralph Lowe Estate #1-17)• 1977 – Parker 157 drills deepest test well to date in Kuwait• 1978 – First “rig on wheels” for Prudhoe Bay• 1980 – First American land driller in China• 1991 – First Western driller to work in Soviet Union• 1998 – Designs & builds first Arctic-class barge rig (Rig 257)• 2002 – Designs & builds “Yastreb” for Sakhalin-1• 2005 – Best safety record of all drilling contractors (IADC)• 2007 – Extended Reach Drilling Record – 37,016 feet• 2007 – Named one of America’s Safest Companies by
Occupational Hazards magazine• 2007 – New High-Efficiency Rigs
Innovation is Foundation of Growth Strategy 5
Int’l Land Rigs Return to Work in 2007Int’l Land Rigs Return to Work in 2007
23 rigs begin operations or receive new contracts• 7 rigs were inactive at the beginning of the year
• (121, 165, 221, 249, 258, 230, 253)
• 4 rigs are new PKD rigs• (264, 265, 266, 267)
• 6 rigs are new Saudi JV rigs• 5 rigs received new contracts
• (256, 107, 216, 236, 231,122)
• Average Contract Term of 2.68 years• 18 rigs begin 3-year contracts• 2 rigs begin 2-year contracts• 3 rigs begin 1-year contracts
• Average dayrate improvement of ~75%6
Areas of OperationAreas of Operation
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AlaskaAlaska
MexicoMexico
Quail ToolsQuail Tools
ColombiaColombia
NewNewZealandZealand
IndonesiaIndonesia
Papua NewPapua NewGuineaGuinea
ChinaChina
KuwaitKuwait
Sakhalin Sakhalin IslandIsland
Kazakhstan
Turkmenistan
Bangladesh
Land Barge Under Construction Project Management
Saudi ArabiaSaudi ArabiaAlgeriaAlgeria
Gulf of MexicoGulf of Mexico
LibyaLibya
One additional land rig under construction
Fleet OverviewFleet Overview
Market Land Rigs
Barge Rigs
O & M Contracts
US 16 1CIS 8 1 2Latin America 8 1 -Asia Pacific 9 - 2Africa & Middle East 9* - 1Under Construction 2 - -Total 36 18 6
* includes 6 rigs in Saudi JV
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Demand DriversDemand Drivers
• Searching for and developing large fields and significant reserves in challenging frontier regions
• Drilling deeper, more directional, and extended-reach wells
• Search often leads to environmentally sensitive areas
• Shortage of qualified personnel• HSE is a critical performance variable used to
evaluate buying decisions
Big Reserves Are Harder to Reach9
Parker’s SolutionParker’s Solution
• Globally integrated solutions for lower total cost of drilling investment in challenging and frontier areas– Preferred rigs– Experienced and trained crews– A leader in safety and operations in environmentally
sensitive areas– Rental tools on demand– “Smart Iron” services: value-added services
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“Smart Iron” Services“Smart Iron” Services
• Front End Engineering Design (FEED)
• Engineering, Procurement, Construction and Installation (EPCI)
• Operations and maintenance of 3rd party rigs
• Project management
• Training
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Drilling in Frontier Environments Drilling in Frontier Environments
• Reputation for operational expertise and experience– Yastreb – Sakhalin Island, Russia – Orlan platform – Sakhalin Island,
Russia– Rig 257-north Caspian Sea– Liberty Project, Alaskan Beaufort
Sea• Operation and maintenance of
third party rigs – Additional services such as
engineering, logistics, HSE programs, and preventive maintenance programs
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Technical Leadership - Case Study 1Technical Leadership - Case Study 1
Kazakhstan AreaAverage Cost Per Well
$24.7
$20.6$18.2
$16.6$15.0
2.94
1.981.76
1.23
0.94
$0
$5
$10
$15
$20
$25
$30
2001 2002 2003 2004 2005
Mill
ions
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0TRIR
Well Cost TRIR
- 39% Cost Decrease- 200% Safety Improvement
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Technical Leadership - Case Study 2Technical Leadership - Case Study 2
Mexico AreaTotal Drilling Time
0
50
100
150
200
250
300
J-52
3
J-53
2
J-52
2a
J-28
J-50
4
J-60
0
J-52
1
JU-5
06
JU-5
43
JU-6
54
TE-5
13
TE-5
19
Day
s
Other Contractors (1998-2003) Parker (2004-2005)
35% Decrease!
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Extended Reach Drilling (ERD)Extended Reach Drilling (ERD)
20,000
22,000
24,000
26,000
28,000
30,000
32,000
34,000
36,000
38,000
China
German
yChin
aSak
halin
China
China
German
yAus
tralia
China
Norway
-N Sea
Sakha
linUK-W
ytch
Osebe
rg B47
Sakha
linSak
halin
Sakha
linUK-W
ytch
Sakha
linSak
halin
Sakha
linSak
halin
Argenti
naUK-W
ytch
Sakha
lin
Parker Drilling Other
63% of the longest-reach ERD wells have been drilled by Parker
Industry-Leading Safety PerformanceIndustry-Leading Safety Performance
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Quail Tools 12%
U.S. Offshore 29%
International Land 29%
International Offshore
19%
Project Mgmt. 11%
0
1
2
3
4
5
1998
1999
2000
2001
2002
2003
2004
2005
*20
06Curre
nt
IADCParker
(1) TRIR = Recordable Incidents/100 Workers per Year * Lowest TRIR for IADC
Total Recordable Incidence Rate (1)
Quail Tools PerformanceQuail Tools Performance
• Consistently high margins• Business cycle neutral• Six locations (Louisiana, South TX,
West TX, East TX, Wyoming and ND)• New Texarkana facility opened
April 2, 2007• Satellite location in Williston, ND
• Customers are majors and independents on land and offshore –including deepwater
• Marketing synergies with U.S. drilling operations
0
20
40
60
80
100
120
140
2002 2003 2004 2005 2006 3Q 07
Revenue
EBITDA
1701020304050607080
Lower-Risk, High-Profit Exposure to Active U.S. Resource Plays
and Deepwater GOM
2002 2003 2004 2005 2006 3Q 07
Barge Rig Dayrates – GOM Barge Rig Dayrates – GOM
12,000
16,000
20,000
24,000
28,000
32,000
36,000
40,000
44,000
48,000
52,000
56,000
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
3Q06
4Q06
1Q07
2Q07
3Q07
Curren
t
Intermediate Deep
$17,700
$13,000
$46,700
$40,400
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Utilization Trend Utilization Trend
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q 04
2Q 04
3Q 04
4Q 04
1Q 05
2Q 05
3Q 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
1Q 07
2Q 07
3Q 07
Current
Projec
ted
US Barge Rigs International Rigs Total Utilization 19
Growing EBITDA MarginsGrowing EBITDA Margins
20
EBITDA/EBITDA%
$205
$162
$110$105
$192
27% 27%
41%
30%
35%
$50.0
$75.0
$100.0
$125.0
$150.0
$175.0
$200.0
$225.0
2003 2004 2005 2006 3Q 0710.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
• Gulf of Mexico barge business and Quail Tools driving growth in 2005 and 2006
• Escalating day rates in international land contract rollovers, driving growth in 2007 and 2008
• New, international long-term contract daily revenues increasing by an average of 75 percent
Segment Revenue and ProfitabilitySegment Revenue and Profitability
2006EBITDA
2006 Revenues
U.S. Offshore
Quail Tools
Latin America
Asia Pacific
CISAfrica &M.E.
U.S. Offshore
Quail Tools
Latin America
Asia PacificCIS
Africa & M.E.
32.6%
20.8%
5.2%
13.4%24.0%
4.0%
45.4% 31.9%
0.1%13.5%
9.4%
(0.3%)
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Valuation Relative to PeersValuation Relative to Peers
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
8.0x
9.0x
Transo
cean
Diamond
Noble
Pride
Nabors
Rowan
EnscoHerc
ules
Parker
Grey W
olfPatt
erson
EBITDA Multiples - 2008E
Value Opportunity Relative to Peers* EV/EBITDA per Lehman Brothers estimates as of October 29, 2007
Strengthening the Balance Sheet Strengthening the Balance Sheet
590 572
481
380 354329250
350
450
550
650
2002 2003 2004 2005 2006 3Q 07
66%75% 76%
59%
42% 42%
0%
20%
40%
60%
80%
2002 2003 2004 2005 2006 3Q 07
Outstanding Debt
Debt/Capitalization
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2007 Financing2007 Financing
• $125 Million Convertible Notes due July 2012– Low Coupon Rate - 2.125%– Initial Conversion Price of $13.85 hedged to $18.29– Significant cash interest savings
• Proceeds from Convertible Notes used to redeem $100MM Floating Rate Notes in September 2007
• Revolver increased from $40MM to $60MM in September 2007 and extended terms for 5 years
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Demand-Driven InvestmentsDemand-Driven Investments
• $72MM – Construction of four 2,000hp land rigs• $29MM – Construction of 77B, ultra-deep drilling barge• $8MM – Conversion of workover barge 12B to a deep
drilling barge
020406080
100120140
2003 2004 2005 2006 3Q 07
Maintenance Major Projects Quail Tools
• $50MM – Expansion of Quail Tools into East Texas, northern Rocky Mountains, North Dakota (20% in 2006)
• 2007 capital spending estimated to be $235MM
Strategically Investing in Profitable Growth Markets 25
Parker Investment Value Parker Investment Value
• Provides globally integrated solutions for lower total drilling investment in challenging and frontier environments
• High performance = lower total cost of ownership• Strong focus on growing international markets• Growing revenue, cash flow and earnings
– New, preferred rigs coming to market – International contract renewals– O&M contracts– Rental tools– Improving balance sheet
• Maintain and strengthen competitive advantages in deep and frontier drilling through technological leadership
• Continue our 73-year heritage of technological and performance leadership
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Historical Financial PerformanceHistorical Financial Performance
Quail Tools 12%
U.S. Offshore 29%
International Land 29%
International Offshore
19%
Project Mgmt. 11%
($ in millions) 2003 2004 2005 2006 3Q 07
Revenues $339 $377 $532 $586 $474
EBITDA 98 103 162 205 192
Interest Expense 54 50 42 32 20
Current Taxes 17 15 16 21 43
Deferred Taxes 0 0 (45) 16 16
Net Income ($110) ($47) $99 $81 $70
Capex 35 47 70 195 191
Total Assets 848 727 804 901 1081
Debt 572 481 380 329 354
Debt-to-Cap 75% 76% 59% 42% 42%
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