CANADA

Results were up substantially in 2010 as Canada mirrored its U.S. counterpart and began relocating rigs from gas-prone areas into areas characterized by the presence of oil- and liquids-rich natural gas.

This unit continued to focus on safety, an area made even more critical given the number of new employees entering the industry in response to the increase in drilling and workover activity. Enhancements included adding an extra crew member on service rigs and extending the length of our safety orientation and training program.

The outlook for 2011 is for a substantial improvement in operating income driven by continuing increases in both drilling and workover activity. This unit is responding by upgrading existing rigs and by constructing two new drilling rigs and two new service rigs, both with slant-hole capability.

A reduction in royalties by the Alberta government has fueled near-record land sales, a harbinger of even further increases in drilling. Meanwhile, this unit is exploring opportunities to develop the hydraulic fracturing business through its sister company, Superior Well Services.

Nabors Canada continues to invest in new technology. This includes RCCD, a technology which reduces well bore damage in pressure-sensitive areas and for which we have the exclusive license.