Xtreme Coil Drilling Corp.

Xtreme Coil Drilling Corp.

February 27, 2009 18:59 ET

Xtreme Coil Adds Two Rigs in Mexico

CALGARY, ALBERTA--(Marketwire - Feb. 27, 2009) - Xtreme Coil Drilling Corp. ("Xtreme Coil", the "company") (TSX:XDC) announces the expansion of existing operations in Mexico following execution of a new drilling contract with a Weatherford International subsidiary.

Operations Grow in Mexico

We are now preparing to deploy two more Coil Over Top Drive® ("COTD™") drilling rigs under a new long-term day rate contract between Weatherford de Mexico S.A. de C.V. and Xtreme Coil's wholly-owned subsidiary, Xtreme Coil Drilling Mexico, S.A. de C.V. This new commitment in Mexico requires two XTC 400 drilling rigs to operate in the Chicontepec oil development project near Poza Rica.

The XTC 400 is Xtreme Coil's largest rig, a triple, capable of drilling to 10,000 feet with 3-1/2 inch coiled tubing and to 14,000 feet with conventional jointed drill pipe. The rig is built with a 400,000 lb. AC drawworks, a large 200,000 lb. injector and an integral multi-well pad self-skidding system. The two XTC 400 rigs redeploying to Mexico recently completed operations in the Rocky Mountain region of the United States.

Since mid-2008, when Xtreme Coil initiated the company's first international project in Mexico with six newly-built COTD™ drilling rigs, we have now established a fully-staffed Mexico office as an operational base near Poza Rica. Our drilling operations personnel have achieved significant success during this commencement period by recording a very high rate of rig productive time at approximately 95 percent.

New Patent Issued

Xtreme Coil has received notice from the United States Patent and Trademark Office confirming issuance of a new patent. This is Xtreme Coil's fifth patent which protects proprietary design principles applicable to all current and future designs of our COTD™ drilling rigs." The patent, entitled "Coiled Tubing/Top Drive Rig and Method", features multiple methods of deploying coiled tubing on a top drive equipped drilling rig also capable of utilizing jointed pipe for crude oil and natural gas drilling applications. One aspect of this complex patent includes the utilization of a vertically travelling injector to accommodate longer bottom hole assemblies which can be deployed under pressure for efficient re-entry drilling projects.

In addition to issuance of this fifth patent, Xtreme Coil has more than 60 further patent applications still pending in the United States, Canada and other jurisdictions. These patent applications cover our coiled tubing drilling and transportation technology including equipment and methods for coiled tubing drilling to deeper geological horizons of 3,000 meters (10,000 feet) or more.

2008 4Q

Xtreme Coil achieved approximately 950 operating days in total for 2008 4Q. At 2008 year-end, Xtreme Coil had nine rigs under long-term contract. With two rigs moving to Mexico, our drilling rigs under contract will increase to 11 of our current fleet of 16 COTD™ rigs. We are aggressively pursuing opportunities identified in a number of new international regions by providing detailed technical and operating information to illustrate the capability of our rigs to respond to conventional and re-entry drilling projects both in, and beyond, North America.

Corporate Profile

Xtreme Coil develops and applies leading edge patented and patent-pending technology and designs to build, transport, and operate new COTD™ drilling rigs. Currently contracted in the United States and Mexico and marketed to other international regions, Xtreme Coil's innovative, dual-purpose and efficient rigs drill with larger coil to reach hydrocarbons in deeper horizons. Xtreme Coil's proprietary technology also features modular transportation units, larger coil injectors and new methods for achieving deeper, faster and safer drilling. Xtreme Coil's common shares trade on the Toronto Stock Exchange ("TSX") under the symbol "XDC".

Forward-Looking Statements

This news release may include certain information, statements and assumptions regarding management's view of future events, expectations, plans, initiatives or prospects that constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to Xtreme Coil's future outlook and anticipated events or results and may include statements related to anticipated future contracts; patent issuances, commodity pricing; rates of currency exchange; rig building, completion or deployment; operating expenses; capital expenditures and other 2008 guidance provided.

These statements are based on certain factors and assumptions regarding, among others: projection of current operations; ongoing and future business negotiations and opportunities; timing of capital expenditures; market costs and other variables affecting rig building and operating expenses; the ability of vendors to provide rig component equipment, services and supplies, including labour, in a cost-effective and timely manner; the availability and costs of financing; foreign currency exchange rates; the receipt of applied-for patents; and government regulations. Although Xtreme Coil considers these assumptions reasonable, as of this date based on information currently available to management, the assumptions may ultimately prove incorrect.

Financial outlook information contained in this news release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this news release should not be used for purposes other than for which it is disclosed herein.

Readers should not place undue importance on forward-looking information and should not rely upon this information as of any other date. Xtreme Coil disclaims any intention, and assumes no obligation, to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise, except as required pursuant to applicable securities laws.

Contact Information

  • Xtreme Coil Drilling Corp.
    Tom Wood
    Executive Chairman
    (403) 262-9500
    (403) 262-9522 (FAX)
    Xtreme Coil Drilling Corp.
    Rod Uchytil
    President and Chief Executive Officer
    (403) 262-9500
    (403) 262-9522 (FAX)
    Xtreme Coil Drilling Corp.
    1402, 500 Fourth Avenue SW
    Calgary, Alberta T2P 2V6
    Email: ir@xtremecoil.com
    Website: www.xtremecoildrilling.com