IADC Annual Meeting: Today’s industry hums, but what’s the tune for tomorrow?

Times are great, drilling activity is humming, but what about tomorrow? How will contractors, operators and service firms handle the squeeze of people and equipment that looms? On the other hand, will the current newbuild bonanza bust our business with oversupply? How can technology race to the rescue in an era of elusive hydrocarbons?

The 2007 IADC Annual Meeting may not have all the answers, but it surely will provide food for thought on these and other issues. Plus, the conference, 1-2 November at Moody Gardens in Galveston, Texas, will bring together the leading players in drilling, offering outstanding networking and social opportunities.

Transocean is our Platinum Sponsor for the Annual Meeting, while Pride International is the Gold Sponsor. The Marshall Islands Registry is Silver Sponsor for the event. Printing of the program brochure is sponsored by Varel International.

And what better way to start off than by honoring two of the industry’s finest. At the Keynote Breakfast, sponsored by Hydril on Thursday, 1 November, IADC will bestow its coveted Exemplary Service Awards to 2 outstanding individuals. IADC Exemplary Service Awards recognize individuals notable for outstanding contributions to the drilling industry and to IADC. Recipients have, in the course of their career, repeatedly demonstrated their commitment to improving the drilling industry and advancing its safety, training or technology.

This year’s recipients are:

Kevin Lacy, head of discipline-drilling and completions, BP: Mr Lacy is a longtime stalwart of IADC whose contributions include development of industry best practices and enhancements in drilling safety. Mr Lacy generously shares his vision at IADC events and conferences.

Gary Casswell, vice president Eastern Hemisphere operations, Pride International Inc: As chairman of the former IADC subsidiary Drilling Contractor Publications Inc (DCPI), Mr Casswell oversaw the transformation of IADC’s official magazine into the world-class publication it is today. He served on the Advisory Committee for the 2006 IADC/SPE Drilling Conference and is a director of IADC.

IADC has an outstanding keynote speaker lined up for the breakfast, as well – Per Haaland, vice president drilling & completions, Statoil. Mr Haaland is vice president of drilling and completions for Statoil, which late last year announced that it would merge with Norsk Hydro. The new company will be named StatoilHydro and have combined production of 1.9 MM bbls/day, along with proven oil and gas reserves of 6.3 billion bbls of oil equivalent. In mid-2007, Mr Haaland told Drilling Contractor that the company was working with 10 floaters and 13 platforms in Norway on the drilling side, with coiled tubing and wireline on well operations. Over the next couple of years, he expects drilling activity to ramp up further, as three new rigs arrive to work for the Norwegian operator.

Following a break with coffee service sponsored by CB Richard Ellis, Graham Brander, director worldwide drilling, Apache Corporation, will discuss Apache’s drilling strategy. Apache’s strategy is built on a portfolio of assets that provide opportunities to grow both through grassroots drilling and acquisition activities. The company operates in 7 core areas — two in the United States, in Canada, Egypt, the UK North Sea, Australia and Argentina.

Next, we explore a topic central to today’s business climate: personnel development. Speaker Dan Weinfurter, chief executive officer, Capital H Group LLC, points out that the best people are today’s only sustainable competitive advantage. Statistics, he says, show that “A” employees are 6-10 times more productive than average workers, dramatically increasing business effectiveness and visibly impacting revenue generation. This session will combine anecdotes and practical lessons on how to find and keep the right people that will ensure the future success and evolution of your business.

And then back to operating plans and activities. Steve Mamerow, director of worldwide drilling & completions, Pioneer Natural Resources, will discuss Pioneer’s North America-focused strategy. North American assets represented approximately 98% of Pioneer’s proven reserves and 93% of daily production in 2006. That year Pioneer drilled 1,100 wells with 96% success, adding 91 million barrels of oil equivalent proved reserve. The company also replaced an astonishing 200% of production at $18.36 per barrel of oil equivalent. The company increased production from North America by 12% and drilled 10 discoveries in 2 emerging growth areas in South Texas and Tunisia. Pioneer also has operations in South Africa.

At the Hughes Christensen luncheon. IADC president Dr Lee Hunt will recognize IADC’s officer nominees for 2008 and present the IADC Chairman’s plaque.

The featured speaker is David R Anglin, global drilling manager, ExxonMobil Development Company. Mr Anglin’s remarks are titled “Integrated Approach to Well Control Integrity Management.” As global drilling manager, Mr Anglin is responsible for the conduct of safe and effective operations worldwide for a program that averages 45-55 rigs and capital budgets in excess of $6 billion/year.

After lunch, IADC has a special treat that will get those post-dining cerebral juices flowing. Dr John H Lienhard is author and voice of “The Engines of Our Ingenuity,” the nationally syndicated public-radio program whose home station is KUHF in Houston. “Engines” explores the stories behind the history of technology and the people whose ingenuity made today’s world possible. Dr. Lienhard is M.D. Anderson professor emeritus of mechanical engineering and history at the University of Houston. Dr Lienhard’s presentation is sponsored by Ernst & Young LP.

Then, we hear the prognosis for drilling from the horse’s mouth in our always anticipated annual Drillers Outlook.

Three leading drilling contractors representing land and offshore with US and global scope will present their views on the strong outcome of drilling worldwide. Will demand continue? Will newbuilds saturate the market? Where will the people come from to man the units as the older, more experienced employees reach retirement? The panelists will consider the key issues facing the contract-drilling industry:

Doug Wall, chief operating officer, Patterson-UTI Drilling Company LP

Jon Cole, president & CEO, Scorpion Offshore

David Williams, senior vice president & chief operating officer, Noble Corporation

The day wraps up with enlightening comments on two new IADC initiatives:

Linda Silinsky-Kephart will discuss IADC Career Connection, which was organized to pursue IADC chairman Robert Long’s vision to broaden the contract-drilling industry’s pool of potential recruits beyond traditional resources. Ms Silinsky-Kephart directs the program.

Sandra Mourton will give an update on the activities of the International Forum of Energy Centres and Museums (IFECM). IFECM was organized under IADC auspices, through the leadership of 2006 IADC Chairman Claus Chur to coordinate educational outreach among global energy centers. In addition, Ms Mourton, executive director of the Offshore Energy Center, will fill us in on our recent events at the OEC, Ocean Star and OEC’s Educational Outreach programs.

The IADC Board of Directors will then convene to discuss association business.

The day concludes with the Annual Meeting Reception at the Lone Star Flight Museum. Attendees will enjoy an evening of nostalgia among one of the finest collections of flyable World War II aircraft in the USA.

Musical entertainment will be provided by “Sparky Koerner” and his jazz ensemble. Drinks and snacks will be served. Shuttle buses will transport guests to and from the museum. The evening is co-sponsored by Caterpillar Inc and Security DBS, a Halliburton company.

Friday kicks off with coffee and refreshments sponsored by Tesco Corporation.

The first session is the Operator’s Outlook Breakfast & ReedHycalog Rig Census, sponsored by ReedHycalog. ReedHycalog president John Deane will present the 2007 census and associated contractor survey, one of the major statistical benchmarks on the land and offshore drilling industry.

IADC is particularly proud to introduce the morning’s featured speaker, Barbara Yilmaz, technology vice president for global drilling & completions for BP. Ms Yilmaz is a 25-year veteran of BP. Her prior roles include various line leadership roles such as business unit leader for North American exploration.

Next, we will learn about “Rigs of the Future/Wells of the Future” from those in the know:

Rick Fontova, senior vice president, Enventure Global Technology: “The Well of the Future – Kiss Today Goodbye”: Whether in mature onshore basins or in ultra-deepwater, wells of tomorrow will have little resemblance to the wells we operate today. Hear what influences could cause every aspect of the well to change, from ownership, planning, design and construction to drilling, completion and abandonment.

Pete Miller, chairman, president & CEO, National Oilwell Varco: “Blending the Future: Bringing Offshore Automation together with Land Efficiency”: The offshore drilling industry, Mr Miller says, has led the march to automated equipment on drilling rigs, while land drillers have markedly improved efficiency and drilling times. Blending offshore automation with land efficiency in the rigs of the future will yield ever improving economics for drilling around the world. This must be done in a manner that recognizes the unique economic profile of land and offshore drilling rigs.

John De Wardt, president, De Wardt & Company, will discuss “Real Business Growth in Today’s Oilfield.” Says Mr De Wardt, “It is easy to ride the wave of high demand; however, the true growth companies are those who have focused strategies, differentiate themselves and deliver products and services quickly as well as at lower cost.”

Last, but far from least, the highly regarded analyst Jim Wicklund, partner & chief investment officer, Spinnerhawk Capital Management, will provide perspective to current market trends and some guideposts to 2008 and beyond.

IADC chairman Robert L Long, chief executive officer, Transocean, will then adjourn the conference.

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