Stoneham Drilling Trust

Stoneham Drilling Trust

May 15, 2006 08:00 ET

Stoneham Drilling Trust Announces Construction of Rigs 19 and 20, Provides Update on Rig Construction Program

CALGARY, ALBERTA--(CCNMatthews - May 15, 2006) - Stoneham Drilling Trust (TSX:SDG.UN) is pleased to announce its intention to construct two additional drilling rigs for an aggregate cost of approximately $23 million. Rigs 19 and 20 are being built by Houston-based National Oilwell Varco, and are scheduled for completion in the fourth quarter of 2007.

Identical in design to Rigs 14 and 15, the two rigs will be new generation telescopic double drilling rigs with 400,000 pound hook-load capacities designed to drill to depths of 3,500 plus metres.

Upon completion, Rig 19 will commence working for a client under a multi-year contract with a specified minimum number of operating days. The rig will utilize Stoneham's patent pending Quad Pad technology to drill horizontal coal-bed methane wells. Rig 20 is not currently contracted; however, as demand for Stoneham's services continues to exceed our capacity, we believe it is prudent to begin construction due to the long lead-times required to construct new drilling rigs, which can be up to 18 months.

As noted in our May 11, 2006 news release, Stoneham has experienced some delays in our 2006 rig construction program. Rigs 14, 15, 16, 17 and 18, currently under construction in Houston, were expected to be delivered to Stoneham in the third and fourth quarters of 2006. Delays of approximately 45 days on Rigs 14 and 15 now indicate that all five Houston constructed rigs will likely be deployed to our clients during the fourth quarter of 2006. Rigs 11 and 12 had been expected to be deployed during the current quarter. Timing of completion of these rigs has been delayed and is currently under review with the Alberta-based supplier.

About Stoneham

Stoneham Drilling Trust is an income trust that provides contract drilling services to oil and natural gas exploration and production companies operating in western Canada. With its modern, innovative fleet of drilling rigs, Stoneham is an industry leader in operational performance and rig utilization. Stoneham trades on the TSX under the symbol SDG.UN. The Trust pays monthly cash distributions to unitholders.

This news release may contain forward-looking statements concerning the anticipated performance of Stoneham. Forward-looking statements are based on the estimates and opinions of management at the date the statements are made and, subject to its obligations under applicable law, Stoneham does not intend and does not assume any obligation to update these forward looking statements if conditions or opinions should change.

The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.

Contact Information