Independence Contract Drilling Inc
We provide land-based contract drilling services for oil and natural gas producers
targeting unconventional resource plays in the United States. We construct,
own and operate a premium land rig fleet comprised entirely of technologically
advanced, custom designed ShaleDriller® rigs that are specifically engineered
and designed to optimize the development of our customers’ most technically
demanding oil and natural gas properties. We are focused on creating stockholder
and customer value through our commitment to operational excellence and our
focus on safety.
Our standardized fleet consists of fourteen premium ShaleDriller® rigs.
Of these fourteen rigs, thirteen are 200 series rigs equipped with our integrated
omni-directional walking system that is specifically designed to optimize pad
drilling for our customers. We have the ability to upgrade our remaining non-walking
rig to 200 series status when market conditions improve, but until such time
this rig has been decommissioned and we do not intend to market it. Every ShaleDriller®
rig in our fleet is a 1500-hp, AC programmable rig (“AC rig”) designed
to be fast-moving between drilling sites and is equipped with top drives, automated
tubular handling systems and blowout preventer (“BOP”) handling
systems. Twelve of our fourteen rigs are equipped with bi-fuel capabilities
that enable the rig to operate on either diesel or a natural gas-diesel blend.
Our business depends on the level of exploration and production activity by
oil and natural gas companies operating in the U.S., and in particular, the
regions where we actively market our contract drilling services. The oil and
natural gas exploration and production industry is a historically cyclical industry
characterized by significant changes in the levels of exploration and development
activities. Oil and natural gas prices and market expectations of potential
changes in those prices significantly affect the levels of those activities.
Worldwide political, regulatory, economic, and military events, as well as natural
disasters have contributed to oil and natural gas price volatility historically,
and are likely to continue to do so in the future. Any prolonged reduction in
the overall level of exploration and development activities in the U.S. and
the regions where we market our contract drilling services, whether resulting
from changes in oil and natural gas prices or otherwise, could materially and
adversely affect our business.
SCR Rigs. In contrast to mechanical rigs, SCR rigs rely on direct current, or
DC, to power the key rig systems. Load is changed by adjusting the amperage
supplied to electric motors powering key rig systems. While a substantial improvement
over mechanical belts and chains, SCR control is imprecise, and DC power levels
normally drift resulting in fluctuations in pump speed and pressure, bit rotation
speed, and weight on bit. These fluctuations can cause wellbore deviation, shorter
bit life and less optimal rates of penetration. In addition, SCR equipment is
heavy and energy inefficient.
AC Rigs. Compared to SCR and mechanical rigs, AC rigs are ideally suited for
drilling horizontal wells. The first AC rigs were introduced into the U.S. land
market in the early 2000s, and since that time their use has grown significantly
as the use of horizontal drilling has increased. AC rigs use a computer-controlled
variable frequency drive ("VFD") to precisely adjust key rig operating
parameters and systems allowing for optimization of the rate of penetration,
extended bit life and improved control of wellbore trajectory. These factors
reduce the amount of time a wellbore is “open hole,” or uncased.
Shorter open hole times dramatically reduce adjacent formation damage that can
be caused by shale hydration or drilling fluid invasion and enhance the operator’s
ability to optimally run and cement casing to complete the drilled well. In
addition, when compared to SCR and mechanical rigs, AC rigs are electrically
more efficient, produce more torque, utilize regenerative braking, and have
digital controls. AC motors are also smaller, lighter and require less maintenance
than DC motors.