Kevin, President and CEO of Precision Drilling Trust, delivered a great presentation on both the state of the oil and gas industry from a drilling perspective and some great insight into Precision Drilling and their globalization.

It was interesting to learn of the excess storage levels of oil that are often cited in news stories are quite minimal. In fact right now when the "excess levels" are at an all-time high, this is just five days (yes FIVE days) of excess oil for us to use. If all production stopped, beyond the regular storage capacity the USA would only have five days excess of oil and gas. We in Canada have even less! Kevin cited the example of the mass exodus from Houston prior to the hurricane there a few years ago. As people exited the city they filled up with gas. Within six hours of the evacuation notice every gas station and storage tank in Houston was dry. In SIX hours. Perhaps we need larger reserves!!

Kevin also talked about gas prices probably being at the bottom right now, but he clearly did not say they are on the rise. He noted they are probably at the bottom but may stay there for a bit. The rise may take two to 12 months, but it will come back based on the five-year cycles. It was interesting of him to note that in his 30 years in the patch, this was the first time anyone ever complained about a $35 barrel of oil or gas prices where they are. He said for the vast majority of his career, those prices would be goals to strive for, not ones to turn you nose up at!

He spoke of the "Alberta Advantage" (not Ralph's, the oil and gas industry's). He noted that, with the cold winters, we have an advantage in drilling through frozen ground and Alberta companies, especially Precision Drilling, have learned to master this short turn around time and maximize opportunity. He also noted the incredible technology development that has come from and continues to be fostered in Alberta.

But, with the advantages come disadvantage. The biggest issue we have here is that we have great people that do great work. And, unfortunately, we don't have "systems" in place, instead we have people. It is hard to export people (they are limited) and their great work. He talked about how we here in Alberta need to learn to systemize the success of our products and services and then we can take that system abroad and be globally successful. As well, he noted that the air travel from Calgary is limited. Sure, now we have direct flights to Houston, but we don't have direct flights to the Middle East and Eastern Europe and most of Asia. This means Calgary-based oil executives need to travel two or three days to get to a meeting in the Middle East, while the competition in Houston can do it in a day!

Kevin spoke of the success of Precision Drilling to date and the goal to take this company to be a global leader. The goal is for it to be the leader in global drilling, not an American company. The safety record is also astounding: with 239 rigs in operation, 188 were incident-free in 2008. That is astounding. He also showed a great video on how, with modern technology and owned systems, Precision Drilling can land a contract and when they land on a site to drill, they can be set up and operational in four hours! Just imagine a full drill and rigging system ready to go in four hours! The competition takes two to three days! This is truly an Alberta Advantage from technology owned and developed by Precision Drilling and a part of the reason Kevin will be able to globalize this Alberta based company.

reported by Brent Barootes