Trinidad Drilling Ltd. reports solid first quarter 2014 results; stable dayrates and operating margins in existing business, gr

Trinidad Drilling Ltd. reports solid first quarter 2014 results; stable 
dayrates and operating margins in existing business, growing international 
momentum 
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION 
IN THE UNITED STATES/ 
TSX SYMBOL:  TDG 
CALGARY, May 7, 2014 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or the 
"Company") reported solid first quarter 2014 results; with stable dayrates(1) 
and operating margins in its Canadian and US operations and growing 
international joint venture momentum. 
"The first quarter has been a solid start to what we believe will be an 
important year for Trinidad," said Lyle Whitmarsh, Trinidad's Chief Executive 
Officer. "Our existing North American business continues to operate in line 
with our expectations and we are well positioned to benefit from the improving 
industry conditions we see happening in the US and that we anticipate in 
Canada for the second half of 2014. This year is an important year as we 
transition from a solely North American drilling contractor to a growing 
international service provider. Our joint venture with Halliburton is 
progressing well with benefits being recognized by both partners already. We 
continue to evaluate future expansion opportunities for the joint venture and 
expect that this will be a significant area of growth for us over the coming 
years." 


    (1) See Non-GAAP Measures Definition and Additional GAAP Measures
        Definition section of this document for further details.
    FINANCIAL HIGHLIGHTS
                                                                   
    Three months ended March 31,                                           
    ($ thousands except share and per           2014         2013  % Change
    share data)
    Revenue                                  251,505      247,186       1.7
    Revenue, net of third party costs        231,018      227,377       1.6
    Operating income (1)                      95,192       98,359     (3.2)
    Operating income percentage (1)            37.8%        39.8%     (5.0)
    Operating income - net percentage          41.1%        43.3%     (5.1)
    (1)
    EBITDA (1)                                81,255       82,014     (0.9)
      Per share (diluted) (2)                   0.58         0.68    (14.7)
    Adjusted EBITDA (1)                       79,441       84,836     (6.4)
      Per share (diluted) (2)                   0.57         0.70    (18.6)
    Cash provided by operations               19,433       40,495    (52.0)
      Per share (basic / diluted) (2)           0.14         0.34    (58.8)
    Funds provided by operations (1)          60,857       64,943     (6.3)
      Per share (basic / diluted) (2)           0.44         0.54    (18.5)
    Net earnings                              25,762       32,748    (21.3)
      Per share (basic / diluted) (2)           0.19         0.27    (29.6)
    Adjusted net earnings (1)                 27,746       35,573    (22.0)
      Per share (basic / diluted) (2)           0.20         0.29    (31.0)
    Capital expenditures                      31,206       17,337      80.0
    Dividends declared                         6,908        6,043      14.3
    Shares outstanding - diluted                                           
      (weighted average) (2)             138,899,380  120,859,476      14.9
    As at                                  March 31, December 31,          
    ($ thousands except percentage              2014         2013  % Change
    data)
    Total assets                           1,930,989    1,827,496       5.7
    Total long-term liabilities              597,006      564,095       5.8
    (1)  Readers are cautioned that Operating income, Operating income
         percentage, Operating income - net percentage, EBITDA, Adjusted
         EBITDA, Funds provided by operations, Adjusted net earnings and
         the related per share information do not have standardized
         meanings prescribed by IFRS - see "Non-GAAP Measures" and
         "Additional GAAP Measures".
    (2)  Basic shares include the weighted average number of shares
         outstanding over the period. Diluted shares include the weighted
         average number of shares outstanding over the period and the
         dilutive impact, if any, of the number of shares issuable pursuant
         to the Incentive Option Plan.

OPERATING HIGHLIGHTS
                                                                   
    Three months ended March 31,                                          
                                                      2014   2013 % Change
    Land Drilling Market                                                  
    Operating days (1)                                                    
       Canada                                        4,077  4,198    (2.9)
       United States and International               4,311  4,453    (3.2)
    Rate per operating day (1)                                            
       Canada (CDN$)                                25,415 25,401      0.1
       United States and International (CDN$)       24,630 22,416      9.9
       United States and International (US$)        22,641 22,487      0.7
    Utilization rate - operating day (1)                                  
       Canada                                          74%    79%    (6.0)
       United States and International                 76%    72%      5.9
    Number of drilling rigs at period end                                 
       Canada                                           61     60      1.7
       United States and International                  61     68   (10.3)
       Coring and surface casing rigs (2)                -     15        -
    Barge Drilling Market                                                 
       Operating days (1)                              244    415   (41.3)
       Rate per operating day (CDN$) (1)            37,815 29,097     30.0
       Rate per operating day (US$) (1)             34,767 29,158     19.2
       Utilization rate - operating day (1)            54%    92%   (41.1)
       Number of barge drilling rigs at period end       2      2        -
       Number of barge drilling rigs under Bareboat                       
      Charter Agreements at period end                   3      3        -
    Joint Venture Operations (3)                                          
      Number of drilling rigs at period end              3      -        -
    (1)  See Non-GAAP Measures Definition and Additional GAAP Measures
         Definition section of this document for further details.
    (2)  In the third quarter of 2013, Trinidad disposed of its 15
         remaining coring rigs and all related equipment.
         Trinidad is party to a joint venture with a wholly-owned
    (3)  subsidiary of Halliburton. These rigs are owned by the joint
         venture.

OVERVIEW

Trinidad recorded solid results in the first quarter of 2014, with stable 
dayrates and operating margins in the Company's drilling operations and 
growing momentum in its international joint venture, despite the absence of 
the coring rigs that were sold in 2013.

During the quarter, commodity prices increased from the same quarter in 2013 
and the fourth quarter of 2013, improving sentiment within the industry and 
increasing oil and gas producers' ability to generate higher cash flow. Crude 
oil prices improved for both the US-based WTI benchmark and the Western 
Canadian Select benchmark prices, driving an ongoing focus towards crude oil 
and natural gas liquids targets. Colder-than-usual weather across North 
America and lower storage levels led to strong gains in natural gas pricing 
from the previous quarter and the same period last year. Despite these 
significantly higher natural gas prices, the industry did not demonstrate a 
trend of increased natural gas drilling, choosing rather to stay with their 
existing targets and collect increased cash flow from associated natural gas 
production.

In the first quarter of 2014, Canadian industry activity levels averaged 58%, 
unchanged from the same quarter last year and up from 43% in the previous 
quarter due to seasonality. In the US, industry activity increased in the 
quarter, averaging 1,705 active rigs, up 1.1% from the same quarter last year 
and 1.5% from the previous quarter. The US industry began to show signs of 
improvement with increased activity in the first quarter, a trend that has 
continued to date into the second quarter of 2014.

During the first quarter of 2014, the US dollar strengthened against the 
Canadian dollar. USD/CDN dollar exchange rates averaged 1.0882 in the quarter 
compared to 0.9971 in the same quarter last year and 1.0400 in the previous 
quarter. Trinidad has a significant portion of its business that operates in 
US dollars and the change in foreign exchange rates in the quarter had a 
noticeable, and largely positive impact on the Company's results. The stronger 
US dollar positively impacted EBITDA generated by Trinidad's US and 
international division but also drove increased depreciation and interest 
expenses in the quarter. In addition, the value of the Company's senior note 
increased solely as a result of the impact of foreign exchange in the quarter.

INDUSTRY STATISTICS
                                                                            
                       Full                          Full
                2014   Year                2013      Year            2012
                  Q1  2013    Q4     Q3    Q2    Q1  2012    Q4    Q3    Q2
    Commodity
    Prices                                                                  
    Aeco
    natural gas
    price (CDN$
    per
    gigajoule)   5.34  3.01  3.33   2.32  3.36  3.03  2.26  3.03  2.18  1.81
    Henry Hub
    natural gas
    price (US$
    per mmBtu)   5.15  3.72  3.84   3.55  4.01  3.47  2.75  3.40  2.88  2.29
    Western
    Canada
    Select
    crude oil
    price                                                                   
      (CDN$ per
      barrel)   85.81 75.84 69.62  86.31 79.25 67.64 71.70 60.73 76.29 74.10
    WTI crude
    oil price
    (US$ per
    barrel)     98.72 98.01 97.56 105.82 94.14 94.30 94.09 88.17 92.15 93.30
                                                                            
    US Activity                                                             
    Average
    industry
    active land
    rig count
    (1)         1,705 1,685 1,679  1,687 1,686 1,687 1,852 1,741 1,837 1,902
    Average
    Trinidad
    active land
    rig count
    (2)            48    50    49     51    50    49    57    56    55    58
                                                                            
    Canadian
    Activity                                                                
    Average
    industry
    utilization
    (3)           58%   40%   43%    37%   18%   58%   39%   36%   42%   18%
    Average
    Trinidad
    utilization
    (4)           68%   48%   48%    50%   24%   73%   52%   51%   58%   24%
    (1)  Baker Hughes rig counts (information obtained from Tudor Pickering
         Holt & Company weekly rig roundup report).
    (2)  Includes US and international rigs.
    (3)  Canadian Association of Oilwell drilling Contractors (CAODC)
         utilization.
    (4)  Based on drilling days (spud to rig release dates).
    FIRST QUARTER 2014 HIGHLIGHTS
        --  Trinidad generated revenue of $251.5 million in the first
            quarter of 2014, up $4.3 million and 1.7% from the same quarter
            in 2013. Revenue increased in the current period as a result of
            a higher level of external rig manufacturing and a positive
            foreign currency translation from Trinidad's US division;
            partly offset by the absence of the Company's coring rigs,
            lower activity from the Mexican rigs and a weaker contribution
            from the barge operations.
        --
        --  Overall operating income - net percentage decreased from 43.3%
            in the first quarter of 2013 to 41.1% in the current quarter.
            Profitability in Trinidad's drilling operations remained stable
            compared to the same quarter last year with operating income -
            net percentage for the Company's Canadian and US and
            international operations largely unchanged at 48.0% and 38.2%,
            respectively. Operating income - net percentage for the
            Manufacturing segment increased to 8.6% in the current quarter
            due to a higher level of external new builds in 2014. Overall,
            the manufacturing division typically generates lower margins
            than Trinidad's drilling operations as the external new builds
            are constructed for Trinidad's joint venture company and joint
            venture partner. An increased contribution from the
            manufacturing operations in 2014 caused overall profitability
            to decline.
        --  Adjusted EBITDA was $79.4 million in the quarter, down 6.4%
            from the same quarter last year. Adjusted EBITDA decreased in
            the quarter largely as a result of a decrease in operating
            income. This was partially offset by a favorable foreign
            exchange translation on Trinidad's US and international
            operations, as the US dollar strengthened against the Canadian
            dollar in the period.
        --  Net earnings in the quarter were $25.8 million or $0.19 per
            share (diluted), down 21.3% from the same quarter last year.
            Net earnings decreased largely as a result of a lower operating
            income in the current year, higher general and administration
            costs, a foreign exchange loss recorded in 2014 and larger
            deferred income taxes; offset slightly by a gain on sale in
            2014 on three rigs sold to the joint venture.
        --  Adjusted net earnings decreased by $7.8 million in the quarter
            compared to the same quarter last year, with adjusted net
            earnings per share (diluted) decreasing $0.09 per share.
            Adjusted net earnings decreased in the current year due to
            lower adjusted EBITDA, and higher income tax expenses in the
            current period.
        --  During the first quarter, Trinidad made progress on its joint
            venture with Halliburton, selling three upgraded US rigs to the
            joint venture and transporting them to Saudi Arabia. In
            addition, Trinidad added a new area of operation for the joint
            venture during the quarter, agreeing to build four new rigs for
            operation in Mexico. All of the joint venture rigs will be
            operating under three year, take-or-pay contracts, with a one
            year optional extension by the customer.

RESULTS FROM OPERATIONS

Canadian Operations
                                                                         
    Three months ended March 31,                                         
    ($ thousands except percentage and                          
    operating data)                            2014   2013 (4)   % Change
    Operating revenue (1)                   103,607    115,442     (10.3)
    Other revenue                               722         44    1,540.9
                                            104,329    115,486      (9.7)
    Operating costs (1)                      54,300     59,591      (8.9)
    Operating income (3)                     50,029     55,895     (10.5)
    Operating income - net percentage (3)     48.0%      48.4%           
                                                                         
    Operating days (3)                        4,077      4,198      (2.9)
    Drilling days (3)                         3,713      3,864      (3.9)
    Rate per operating day (CDN$) (3)        25,415     25,401        0.1
    Utilization rate - operating day (3)        74%        79%      (6.0)
    Utilization rate - drilling day (3)         68%        73%      (7.3)
    CAODC industry average (2)                  58%        58%          -
                                                                         
    Number of drilling rigs at period end        61         60        1.7
    Number of coring and surface rigs                                    
      at period end                               -         15          -
    (1)  Operating revenue and operating costs for the three months ended
         March 31, 2014 and 2013 exclude third party recovery and third
         party costs of $14.5 million and $13.7 million, respectively.
    (2)  CAODC industry average is based on drilling days divided by total
         days available.
    (3)  See Non-GAAP Measures Definition and Additional GAAP Measures
         Definition section of this document for further details.
    (4)  During the prior year, Trinidad's Canadian operations included the
         Canadian manufacturing division. Effective January 1, 2014,
         Trinidad has re-evaluated operating segments. Management has
         determined that the Manufacturing operations is considered a
         separate operating segment. All prior period segmented information
         has been reclassified to conform to this new presentation.

In the first quarter of 2014, Trinidad's Canadian operations generated $11.8 
million or 10.3% less operating revenue when compared to the same quarter last 
year. Operating revenue lowered largely as a result of the sale of Trinidad's 
preset and coring rigs in the third quarter of 2013; these rigs generated $8.8 
million in operating revenue in the first quarter of 2013 compared to nil in 
the current period. The preset and coring rigs, including related inventory, 
were sold in the third quarter of 2013 for $12.0 million.

In addition, the segment's drilling rigs recorded 121 less operating days than 
the same quarter last year, negatively impacting operating revenue in the 
current period. The lower operating days were mainly driven by weaker customer 
demand in the oilsands sector, reducing activity for the company's lower 
specification equipment. While activity was lower quarter over quarter, 
Trinidad's high performance, modern fleet continued to outperform industry 
activity levels, recording utilization levels that exceeded the industry 
average by ten percentage points for 2014. This is a reflection of the 
Company's strategic focus towards in-demand, high performance equipment backed 
by a strong customer base and long-term contracts. Dayrates in the current 
period were largely unchanged from the same quarter last year.

Operating income - net percentage declined slightly in the current period when 
compared to the prior year, due to weaker customer demand in the oil sands 
sector combined with increased labor costs related to a crew wage increase 
that occurred in the second half of 2013. The lower customer demand in the oil 
sand sector reduced activity levels and negatively impacted margins. In 
addition, the crew wage increase in the third quarter of the prior year, which 
is passed on to operators at cost, reduced profitability as a percentage of 
revenue in the quarter.

During the current quarter, Trinidad's active rig fleet increased by one rig 
when compared to March 31, 2013; one rig was delivered in the third quarter of 
2013. This rig was constructed by the Company's Manufacturing operations and 
was put into service in the Duvernay shale under a long-term, take-or-pay 
contract.

First quarter 2014 versus fourth quarter 2013

Compared to the fourth quarter of 2013, revenue and operating income increased 
by $30.4 million and $16.7 million, respectively, in the first quarter of 
2014. The increase is mainly due to the seasonal nature of the Canadian 
drilling division as the winter drilling season is typically a more active 
period. Additionally, dayrates increased in the current period by $313 per day 
mainly due to the demand for additional equipment on active rigs during the 
winter drilling season. Operating income - net percentage also increased to 
48.0% compared to 45.1% in the fourth quarter of 2013 due to stronger revenue 
generation based on the increased number of operating days and the increased 
dayrate in the current period.

United States and International Operations
                                                                           
    Three months ended March 31,                                           
    ($ thousands except percentage and                            
    operating data)                              2014   2013 (3)   % Change
    Operating revenue (1)                     114,781    111,575        2.9
    Other revenue                                  46         22      109.1
                                              114,827    111,597        2.9
    Operating costs (1)                        70,972     69,014        2.8
    Operating income (1)                       43,855     42,583        3.0
    Operating income - net percentage (2)       38.2%      38.2%           
                                                                           
     Land Drilling Rigs                                                    
    Operating days (2)                          4,311      4,453      (3.2)
    Drilling days (2)                           3,727      3,823      (2.5)
    Rate per operating day (CDN$) (2)          24,630     22,416        9.9
    Rate per operating day (US$) (2)           22,641     22,487        0.7
    Utilization rate - operating day (2)          76%        72%        5.9
    Utilization rate - drilling day (2)           66%        62%        6.3
    Number of drilling rigs at period end          61         68     (10.3)
                                                                           
     Barge Drilling Rigs                                                   
    Operating days (2)                            244        415     (41.3)
    Rate per operating day (CDN$) (2)          37,815     29,097       30.0
    Rate per operating day (US$) (2)           34,767     29,158       19.2
    Utilization rate - operating day (2)          54%        92%     (41.1)
    Number of barge drilling rigs at period                       
    end                                             2          2          -
    Number of barge drilling rigs under                                    
          Bareboat Charter Agreements at                          
    period end                                      3          3          -
    (1) Operating revenue and operating costs for the three months ended
        March 31, 2014 and 2013 exclude third party recovery and third
        party costs of $5.7 million and $6.1 million, respectively.
    (2) See Non-GAAP Measures Definition and Additional GAAP Measures
        Definition section of this document for further details.
    (3) During the prior year, Trinidad's US and international operations
        included the US manufacturing division. Effective January 1, 2014,
        Trinidad has re-evaluated operating segments. Management has
        determined that the Manufacturing operations is considered a
        separate operating segment. All prior period segmented information
        has been reclassified to conform to this new presentation.

In the first quarter of 2014, Trinidad's US and international segment recorded 
operating revenue of $114.8 million, up 2.9% from the same quarter last year. 
Operating revenue increased in the quarter due to improved dayrates and a 
stronger US dollar, partially offset by lower operating days and a weaker 
contribution from the Company's barge operations.

Dayrates in the current quarter increased by US$154 per day compared to the 
same quarter last year. Dayrates increased as a result of early termination 
revenue and standby revenue received in the quarter. This standby and early 
termination revenue increased the dayrate in the first quarter by US$1,713 per 
day, compared to US$665 per day in the same period in 2013. Early termination 
revenue was received on two rigs during the quarter. Both of these rigs have 
subsequently been put back to work with a new customer under long-term 
contracts. Higher US dollar dayrates combined with a stronger USD/CDN exchange 
rate in 2014 caused dayrates, when converted to Canadian dollars, to increase 
by CDN$2,214 per day compared to the same quarter last year.

Operating days decreased by 142 days quarter over quarter as a result of three 
Mexican rigs that were idle in the current quarter. Excluding the impact of 
these rigs, the US land drilling division recorded an increase in operating 
days in the quarter.

The three rigs Trinidad has in Mexico completed their contracts at the end of 
the second quarter of 2013 and were idle during most of the second half of 
2013 and into 2014, negatively impacting utilization and revenue generation in 
the current year. Trinidad is currently pursuing future opportunities for 
these rigs and expects to redeploy them to Canada where they are expected to 
return to work in the second half of 2014.

For the three months ended March 31, 2014, Trinidad's active rig count 
decreased by seven rigs when compared to the prior year. Four rigs were 
removed from Trinidad's active rig count at December 31, 2013, due to these 
rigs not meeting customer requirements in the current drilling environment. 
Additionally, three rigs were sold to Trinidad's joint venture in the first 
quarter of 2014.

Operating income - net percentage remained consistent at 38.2% quarter over 
quarter. Early termination and standby revenues in the US land drilling 
division, offset by decreased profitability in the Company's barge division 
and Mexico rigs led to overall stable profitability.

Trinidad's barge drilling rigs continued to demand a strong dayrate in the 
current year, showing an increase of US$5,609 per day in 2014 compared to the 
prior year. However, a decline in operating days in the current period caused 
overall revenue generation and profitability to decline. Drilling projects 
that were expected to take place in the first quarter were pushed back to 
later periods, causing downtime in the current quarter on these rigs. Trinidad 
anticipates that activity levels will return to previous levels in the coming 
quarters.

First quarter 2014 versus fourth quarter 2013

Compared to the fourth quarter of 2013, revenue and operating income decreased 
by $21.2 million and $21.6 million, respectively, in the first quarter of 
2014. The decrease in the current period was due to lower early termination 
and standby revenues received in 2014 as well as a decrease in overall 
operating days in the current period. In the fourth quarter of 2013, Trinidad 
recorded US$25.4 million of early termination and standby revenue, compared to 
US$7.4 million received in 2014. Additionally, a decrease of 159 operating 
days in the current period has also negatively affected revenue generation in 
the period.

Operations in the current period were also negatively impacted by the decline 
in operations of Trinidad's barge drilling rigs, which had operating days and 
utilization of 244 days and 54%, respectively, in the first quarter of 2014 
compared to 394 days and 86% in the fourth quarter of 2013.

Joint Venture Operations

Summarized statement of operations and comprehensive loss for Trinidad 
Drilling International (TDI):
                                                                           
    For the three months ended March 31, 2014              TDI     Trinidad
    ($ thousands)                                    ownership    ownership
                                                    percentage   percentage
                                                          100%          60%
    Revenue                                                                
    Oilfield service revenue                             3,316        1,990
                                                         3,316        1,990
    Expenses                                                               
    Operating expenses                                   2,074        1,244
    General and administrative expenses                  1,466          880
    Foreign exchange                                       (6)          (4)
    Loss                                                 (218)        (131)

During 2013, Trinidad signed a joint venture agreement with Halliburton with a 
right of first look at all drilling projects outside of Canada and the United 
States. The joint venture is expected to concentrate initially on Saudi Arabia 
and Mexico, with future growth opportunities in other international markets. 
The joint venture will conduct business under the name Trinidad Drilling 
International (TDI) through separately incorporated entities.

Trinidad owns 60% of the shares of TDI, and each of Trinidad and Halliburton 
have equal voting rights with respect to the operations of the company. TDI is 
accounted for using the equity method of accounting, whereby Trinidad takes 
60% of the net income recorded as loss (gain) from investment in joint venture.

During the three months ended March 31, 2014, TDI took ownership of the three 
upgraded rigs purchased from Trinidad's US land drilling division. These rigs 
have not been put into service as of the quarter end; however, they did 
collect standby revenue, which accounts for the entire revenue balance earned 
in the quarter. Drilling operations are expected to commence early in the 
second quarter in Saudi Arabia.

Rig Purchase Commitments

During 2013, TDI agreed to purchase four rigs from Trinidad for operations in 
Saudi Arabia, three upgraded rigs from Trinidad's US operations and one new 
build rig constructed by Trinidad's manufacturing division. As of March 31, 
2014, TDI has taken ownership of the three upgraded rigs, with the new build 
rig expected to be completed in the second half of 2014. All four rigs will be 
operating under three-year, take-or-pay contracts with an optional one year 
extension.

Additionally, early in 2014, TDI agreed to purchase four rigs from Trinidad's 
manufacturing division for operations in Mexico. Each of these rigs will be 
high performance, 3,600 horsepower, AC, walking rigs, operating under 
three-year, take-or-pay contracts with an optional one year extension. These 
rigs are expected to be delivered towards the end of 2014 and early 2015.

Manufacturing Operations
                                                                      
    Three months ended March 31,                                      
    ($ thousands except percentage and                       
    operating data)                           2014     2013   % Change
    Operating revenue (2)                   11,854      294    3,931.9
    Other revenue                                8        -          -
                                            11,862      294    3,934.6
    Operating costs (2)                     10,836      413    2,523.7
    Operating income (1)                     1,026    (119)      962.1
    Operating income - net percentage (1)     8.6%   -40.5%           
    (1) See Non-GAAP Measures Definition and Additional GAAP Measures
        Definition section of this MD&A for further details.
        For the three months ended March 31, 2014, included in operating
        revenue and operating costs are downstream elimination entries of
    (2) $7.6 million and $6.9 million, respectively (2013, nil and nil,
        respectively). These entries remove Trinidad's percentage of
        profits related to manufacturing of rigs for the joint venture.

Effective January 1, 2014, Trinidad reviewed all existing operating segments 
in order to better present the Company's operations based on geographic 
location, services provided and any material changes to operations. In the 
prior year, Trinidad's manufacturing operations mainly performed work 
internally; therefore, the prior year operating income includes a loss based 
on costs incurred by the manufacturing division mainly related to raw 
materials consumed during construction of rigs for internal use. Towards the 
end of 2013 and early 2014, Trinidad's manufacturing division signed contracts 
to build rigs for external parties, including the Company's joint venture 
partner and the joint venture company.

As the manufacturing operations begins to record operating revenues and costs, 
management believes that presenting this division as a separate operating 
segment from the Company's drilling operations is more useful to users as it 
will provide a more accurate representation of the margins recorded on 
Trinidad's drilling operations. Prior period segmented information has been 
reclassified to conform to the current period's presentation.

The purpose of the manufacturing operations is to support rig builds and rig 
maintenance for all of Trinidad's divisions, including all associates and 
joint ventures. All contracts are based on a cost plus formula which is 
calculated in order for Trinidad to break even on rig builds when all costs, 
including general and administrative expenses, are factored in. Contracts are 
negotiated depending on the Company's varying involvement, which can range 
from full scale design and manufacturing to project management with a large 
degree of outsourcing.

Towards the end of 2013 and into 2014, Trinidad signed five new build 
contracts. One rig for the joint venture to operate in Saudi Arabia and four 
rigs for the joint venture to operate in Mexico. Additionally, Trinidad has 
agreed to build a training rig for their joint venture partner. For the period 
ended March 31, 2014, Trinidad recognized revenues and expenses related to the 
one Saudi rig build and the training rig, compared to no external new build 
revenues or expenses recognized in 2013. Additionally, as of March 31, 2014, 
Trinidad is still early in the construction phase of the four Mexico rigs. 
Long-lead items have been ordered, but assembly has not occurred as yet. 
Therefore, there is no related revenue or expenses included in Trinidad's 
operating income related to the construction of these rigs.

Delivery of the Saudi rig is expected in the second half of 2014, the training 
rig is expected to be delivered towards the end of 2014 and delivery of the 
four Mexico rigs is expected towards the end of 2014 and early 2015.

QUARTERLY ANALYSIS
FINANCIAL HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                       
                        2014                 2013                  2012
    ($ millions except
    per share data and
    operating data)      Q1    Q4     Q3    Q2     Q1     Q4     Q3    Q2 
    Revenue             251.5 224.6  208.7 165.4  247.2  209.6  215.1 174.3
    Operating income
    (1)                  95.2  99.6   76.2  55.7   98.4   77.8   80.6  66.4
    Operating income
    percentage (1)      37.8% 44.4%  36.5% 33.6%  39.8%  37.1%  37.5% 38.1%
    Operating income -
    net percentage (1)  41.1% 47.0%  38.5% 35.6%  43.3%  39.7%  40.0% 40.0%
    Net earnings
    (loss)               25.8  28.8    9.2   0.3   32.7 (12.4)   20.0  12.9
    Adjustments for:                                                       
     Depreciation and
    amortization         30.2  29.5   30.1  27.6   29.9   29.2   30.4  25.8
     Foreign exchange     3.1   0.9    0.4     -      -  (1.4)    0.8 (0.7)
     (Gain) loss on
    sale of property
    and equipment      (10.5)   0.1  (0.1)   1.3      - (11.5)      - (0.5)
     Impairment of
    property and
    equipment               -     -      -   0.1      -   70.1    1.3     -
     Loss from
    investment in
    Joint Venture         0.1   0.8      -     -      -      -      -     -
     Finance costs       10.0  12.0   10.4  10.0   10.0   10.1   10.3  10.5
     Income taxes        15.3  11.1    5.9 (1.6)    9.4 (22.2)    2.7   4.4
     Interest Income    (0.2) (0.1)      -     -      -      -      -     -
     Other                5.6   1.5    5.9   2.2    2.8    1.4    2.9   1.0
     Income taxes
    paid                (0.4) (1.8)      - (0.8)  (1.3)  (2.0)  (1.1) (0.7)
     Income taxes
    recovered             0.3   1.5    0.4   0.7      -    0.7    3.9     -
     Interest paid     (18.6) (1.1) (18.4) (0.7) (18.6)  (1.1) (19.5) (1.5)
     Interest
    received              0.2   0.1      -     -      -      -      -     -
    Funds provided by
    operations (1)       60.9  83.3   43.8  39.1   64.9   60.9   51.7  51.2
    Net earnings
    (loss) per share
    (diluted)            0.19  0.23   0.08     -   0.27 (0.10)   0.17  0.11
    Funds provided by
    operations per
    share (diluted)      0.44  0.67   0.36  0.32   0.54   0.50   0.43  0.42
    (1) See the Non-GAAP Measures Definitions and Additional GAAP Measures
        Definitions section of this document for further details.

NON-GAAP MEASURES HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                      
                     2014                 2013                    2012 
      ($ thousands
        except per
    share data and                 Q3     Q2     Q1      Q4     Q3     Q2 
         operating
            data)    Q1     Q4 
    EBITDA (1)     81,255 81,246 55,635 36,326 82,014   4,825 63,398 53,572
    Per share
    (diluted) (2)    0.58   0.65   0.46   0.30   0.68    0.04   0.52   0.44
    Adjusted
    EBITDA (1)     79,441 83,830 61,838 39,941 84,836  63,332 68,387 53,344
    Per share
    (diluted) (2)    0.57   0.68   0.51   0.33   0.70    0.52   0.57   0.44
    Adjusted net
    earnings (1)   27,746 86,168 54,938 38,730 35,573 103,557 80,132 55,678
    Per share
    (diluted) (2)    0.20   0.69   0.45   0.32   0.29    0.86   0.66   0.46
          See the Non-GAAP Measures Definitions and Additional GAAP
    (1)   Measures Definitions section of this document for further
          details.
          Diluted shares include the weighted average number of shares
    (2)   outstanding over the period and the dilutive impact, if any, of
          the number of shares issuable pursuant to the Incentive Option
          Plan.

OPERATING HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                           
                     2014                  2013                   2012 
                      Q1     Q4     Q3     Q2     Q1     Q4     Q3     Q2 
    Land Drilling                                                          
    Market                                                          
    Operating days                                                         
    (1)                                                             
       Canada        4,077  2,935  3,018  1,434  4,198  2,915  3,233  1,288
       United                                                         5,289
      States and
      International  4,311  4,470  4,733  4,578  4,453  4,789  5,038
    Rate per                                                               
    operating day    
    (1)                                                             
       Canada                                                        25,343
      (CDN$)        25,415 25,102 23,686 25,511 25,401 26,190 23,501
       United                                                        22,586
      States and
      International
      (CDN$)        24,630 27,243 23,297 22,908 22,416 22,305 22,518
       United                                                        22,616
      States and
      International
      (US$)         22,641 26,213 22,460 22,436 22,487 22,589 22,263
    Utilization                                                            
    rate -           
    operating day
    (1)                                                             
       Canada          74%    52%    54%    26%    79%    56%    62%    26%
       United                                                           86%
      States and
      International    76%    71%    76%    73%    72%    77%    81%
    Number of                                                              
    drilling rigs    
    at period end                                                   
       Canada           61     61     61     60     60     59     57     55
       United                                                            68
      States and
      International     61     64     68     68     68     68     68
       Coring and                                                        20
      surface
      casing rigs        -      -      -     15     15     15     20
                                                                           
    Barge Drilling                                                         
    Market                                                          
       Operating                                                        429
      days (1)         244    394    449    445    415    386    376
       Rate per                                                      29,072
      operating day
      (CDN$) (1)    37,815 34,810 33,962 31,731 29,097 29,954 30,008
       Rate per                                                      29,106
      operating day
      (US$) (1)     34,767 33,490 32,740 31,077 29,158 30,330 29,583
       Utilization                                                      94%
      rate -
      operating day
      (1)              54%    86%    97%    98%    92%    84%    82%
       Number of                                                          2
      barge
      drilling rigs
      at period
      end                2      2      2      2      2      2      2
       Number of                                                           
      barge
      drilling rigs
      under                                                         
      Bareboat                                                            3
      Charter at
      period end         3      3      3      3      3      3      3
    Joint Venture                                                          
    Operations (2)                                                  
      Number of                                                           -
      drilling rigs
      at period end      3      -      -      -      -      -      -
    (1)  See Non-GAAP Measures Definition and Additional GAAP Measures
         Definition section of this document for further details
         Trinidad is party to a joint venture with a wholly-owned
         subsidiary of Halliburton. During the first quarter of 2014, 3
    (2)  rigs were sold to the joint venture by Trinidad's US and
         international operations. Effective March 31, 2014, these rigs are
         owned by the joint venture.

FINANCIAL SUMMARY

Trinidad's total long-term debt balance increased by $19.2 million during the 
current year when compared to December 31, 2013. This increase was due to the 
increase in the Senior Notes at March 31, 2014, and is entirely a result of 
the increase in the US to Canadian dollar exchange rate in 2014 versus the 
prior year as these notes are held in US funds. The Senior Notes are 
translated at each period end, as such their value will fluctuate with 
variations in exchange rates. The Senior Notes are due January 2019 and 
interest is payable semi-annually in arrears on January 15 and July 15.

As of March 31, 2014 and December 31, 2013, Trinidad's revolving debt 
facilities were completely paid off, leaving $200.0 million and US$100.0 
million unutilized in these facilities, respectively. The Company continues to 
consider future capital commitments, and as such, the unutilized facilities 
are expected to be used in the future course of business. The Canadian and US 
revolving facilities require quarterly interest payments that are based on 
Bankers Acceptance and LIBOR rates and incorporate a tiered interest rate, 
which varies depending on the results of the Consolidated Total Debt to Bank 
EBITDA ratio. The facility matures on December 16, 2017, and is subject to 
annual extensions of an additional year on each anniversary.

Capital expenditures
                                                     
    Three months ended March 31,        2014     2013
    New Builds                        15,351   12,527
    Capital Upgrades & Enhancements   10,800    1,616
    Maintenance & Infrastructure       5,055    3,194
    Total                             31,206   17,337

During the three months ended March 31, 2014, a total of $31.2 million was 
spent on capital expenditures, compared to $17.3 million for the same period 
in the prior year. These capital expenditures were substantially related to 
the Company's rig build program for its Canadian operations. As well, Trinidad 
continued to work on upgrading existing equipment including moving systems, 
top drives and mud systems, to ensure the Company's rigs remain competitive in 
the current market.

The costs associated with Trinidad's external new builds are not included in 
the Company's capital expenditures shown above. These costs are accounted for 
using the percentage of completion method and are recorded as operating costs 
included in Trinidad's manufacturing operations.

In 2014, Trinidad expects to spend a total of approximately $315.0 million on 
capital projects. This total includes Trinidad's internal capital projects, 
Trinidad's portion of the joint venture capital projects, and takes into 
account proceeds received for existing rigs sold into the joint venture. 
Trinidad's capital budget is further broken down as follows:

------------------------------
        --  Completion of one new rig to be delivered to Trinidad's
            Canadian operations for LNG-related drilling;
        --  Completion of  one new rig and the upgrading of three existing
            rigs to be delivered to Saudi Arabia for the joint venture
            arrangement;
        --  Construction of four new rigs to be delivered to Mexico for the
            joint venture arrangement in late 2014 or early 2015;
        --  Upgrades to improve the efficiency and marketability of more
            than 30 existing rigs; and
        --  Maintenance and infrastructure capital.

------------------------------

Excluding proceeds received from the sale of rigs into the joint venture, 
Trinidad spent $38.1 million on internal capital projects and its portion of 
the joint venture projects in the first quarter of 2014. Costs related to the 
joint venture rig build projects are accounted for as operating expenses in 
Trinidad's manufacturing operations.

As of March 31, 2014, the three upgraded rigs have been delivered to the joint 
venture, and Trinidad continues work on the remaining new build rigs included 
in the 2014 capital program.

OUTLOOK

To date in 2014, activity levels have remained firm in North America, with 
Canadian conditions similar to last year and the US beginning to show 
increasing activity and dayrates.

In the past 12 months the benefits of modern, high-performance equipment have 
become more widely acknowledged and customers are increasingly looking for 
efficient, technically-advanced equipment that can drill deeper and 
longer-reach horizontal wells. This trend is continuing and expanding into new 
areas and Trinidad's reputation as a high-performance driller with modern, 
efficient rigs positions it well for these changing industry conditions.

Natural gas prices have remained stronger to date in 2014 and while they have 
not yet led to a significant increase in dry gas drilling, the improved 
pricing on associated gas production improves customers' cash flow and 
provides the ability to increase capital spending as the year progresses.

Industry conditions in Canada are stable, with upside momentum as oil and gas 
producers re-evaluate their capital programs under stronger commodity prices. 
In addition, LNG-related demand is expected to drive increasing activity 
levels as the projects and their timelines become clearer towards the end of 
2014 and into 2015. In the US, conditions continue to improve with activity 
levels across the country growing and dayrates moving up, particularly for 
high performance equipment. On the international front, Trinidad's joint 
venture with Halliburton is progressing well. Trinidad is currently 
constructing five new rigs that will be sold into the joint venture to operate 
in Mexico and Saudi Arabia, bringing the total number of rigs in the joint 
venture to eight. The joint venture is continuing to assess opportunities for 
expansion and Trinidad expects this to be a strong area of growth in the 
coming years.

Trinidad has followed a strategic plan over the past few years, positioning 
the Company well for sustainable growth in today's changing drilling industry. 
The next step in Trinidad's plan is to successfully transition from its 
historical North American operations to a growing international drilling 
contractor. The Company is making good progress on this front while also 
remaining focused on its existing US and Canadian operations.  Trinidad 
expects to grow its international business at a measured pace, ensuring 
operations are well established and running smoothly before adding new 
operating areas. Trinidad is uniquely positioned with three distinct growth 
areas (Canada, the US and international), while also having the cash flow and 
financial flexibility to fund its future growth.

CONFERENCE CALL

A conference call and webcast to discuss the results will be held for the 
investment community on Thursday May 8(th), 2014 beginning at 9:00 a.m. MT 
(11:00 a.m. ET).  To participate, please dial (888) 231-8191 (toll-free in 
North America) or (647) 427-7450 approximately 10 minutes prior to the 
conference call. An archived recording of the call will be available from 
approximately 12:30 p.m. MT on May 8(th), 2014 until midnight May 15(th), 2014 
by dialing (855) 859 2056 or (416) 849-0833 and entering replay access code 
25656531.

A live audio webcast of the conference call will also be available via the 
Investor Relations page of Trinidad's website.

TRINIDAD DRILLING LTD.

Trinidad is a corporation focused on sustainable growth that trades on the 
Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in 
the drilling and barge-drilling sectors of the North American oil and natural 
gas industry with operations in Canada, the United States and Mexico. In 
addition, through a joint venture, Trinidad has the opportunity to operate 
drilling rigs in other international markets such as Saudi Arabia and Mexico. 
Trinidad is focused on providing modern, reliable, expertly designed equipment 
operated by well-trained and experienced personnel. Trinidad's drilling fleet 
is one of the most adaptable, technologically advanced and competitive in the 
industry.
                                                                        
    CONSOLIDATED STATEMENTS OF FINANCIAL       
    POSITION                                                            
                                                                        
    As at                                       March 31,  December 31, 
    ($ thousands) - unaudited                        2014          2013 
                                                                        
    Assets                                                              
    Current Assets                                                      
    Cash and cash equivalents                     278,069        268,160
    Accounts receivable                           212,823        166,557
    Inventory                                      19,560          8,474
    Prepaid expenses                               15,277          5,557
    Assets held for sale                            3,685          3,685
                                                  529,414        452,433
                                                                        
    Property and equipment                      1,239,834      1,275,465
    Intangible assets and goodwill                 95,229         91,729
    Investment in joint venture                    66,512          7,869
                                                1,930,989      1,827,496
                                                                        
    Liabilities                                                         
    Current Liabilities                                                 
    Accounts payable and accrued liabilities      101,245        110,455
    Dividends payable                               6,908          6,906
    Deferred revenue and customer deposits         67,548         31,952
                                                  175,701        149,313
                                                                        
    Long-term debt                                487,894        468,670
    Deferred income taxes                         109,112         95,425
                                                  772,707        713,408
                                                                        
    Shareholders' Equity                                                
    Common shares                               1,117,637      1,117,197
    Contributed surplus                            50,664         50,607
    Accumulated other comprehensive income         29,247          4,404
    Deficit                                      (39,266)       (58,120)
                                                1,158,282      1,114,088
                                                1,930,989      1,827,496
                                                                          
    CONSOLIDATED STATEMENTS OF OPERATIONS AND                 
    COMPREHENSIVE INCOME                                              
                                                                      
    Three months ended March 31,                                      
    ($ thousands) - unaudited                           2014     2013 
                                                                      
    Revenue                                                           
    Oilfield service revenue                         250,447   247,120
    Other revenue                                      1,058        66
                                                     251,505   247,186
                                                                      
    Expenses                                                          
    Operating expense                                156,313   148,827
    General and administrative                        21,191    16,314
    Depreciation and amortization                     30,255    29,859
    Foreign exchange                                   3,154       (5)
    (Gain) loss on sale of property and equipment   (10,539)        36
                                                     200,374   195,031
                                                                      
    Loss from investment in joint venture                131         -
    Finance costs                                      9,959     9,970
    Earnings before income taxes                      41,041    42,185
                                                                      
    Income taxes                                                      
    Current                                              290     1,071
    Deferred                                          14,989     8,366
                                                      15,279     9,437
    Net earnings                                      25,762    32,748
                                                                      
    Other comprehensive income                                        
    Foreign currency translation adjustment,                          
         net of income tax                            24,843     6,683
                                                      24,843     6,683
    Total comprehensive income                        50,605    39,431
    Earnings per share                                                
    Net earnings                                                      
         Basic / Diluted                                0.19      0.27
    
                                                                          
    CONSOLIDATED
    STATEMENTS OF                                                       
    CHANGES IN
    EQUITY                                                                        
    For three
    months ended                                                        
    March 31,
    2014 and 2013                                                                 
                                              Accumulated                         
                                                   other                          
                      Common    Contribued   comprehensive                  Total
    ($ thousands)                                                       
    - unaudited       shares      surplus      income (1)    (Deficit)     equity
      Balance at
    December 31,                                                        
    2013            1,117,197       50,607           4,404    (58,120)   1,114,088
      Exercise of
    stock                                                               
    options               440        (117)               -           -         323
      Share-based                                                       
    payments                -          174               -           -         174
      Total
    comprehensive                                                       
    income                  -            -          24,843      25,762      50,605
      Dividends             -            -               -     (6,908)     (6,908)
      Balance at
    March 31,                                                           
    2014            1,117,637       50,664          29,247    (39,266)   1,158,282
                                                                                  
      Balance at
    December 31,                                                        
    2012              952,043       50,245        (34,403)   (104,036)     863,849
      Stock-based                                                       
    compensation            -          170               -           -         170
      Total
    comprehensive                                                       
    income
    (loss)                  -            -           6,683      32,748      39,431
      Dividends             -            -               -     (6,043)     (6,043)
      Balance at
    March 31,                                                           
    2013              952,043       50,415        (27,720)    (77,331)     897,407
    (1) Accumulated other comprehensive income (loss) consisted of the
        foreign currency translation adjustment.
        All amounts will be reclassified to profit or loss when specific
        conditions are met.
                                                                           
    CONSOLIDATED STATEMENTS OF CASH FLOWS                                  
                                                                           
    For three months ended March 31,                                       
    ($ thousands) - unaudited                                 2014    2013 
                                                                           
    Cash provided by (used in)                                             
    Operating activities                                                   
    Net earnings                                            25,762   32,748
    Adjustments for:                                                       
      Depreciation and amortization                         30,255   29,859
      Foreign exchange                                       3,154      (5)
      (Gain) loss on sale of property and equipment       (10,539)       36
      Loss from investment in joint venture                    131        -
      Finance costs                                          9,959    9,970
      Income taxes                                          15,279    9,437
      Interest income                                        (180)      (3)
      Other (1)                                              5,575    2,791
      Income taxes paid                                      (400)  (1,314)
      Income taxes recovered                                   310        -
      Interest paid                                       (18,629) (18,579)
      Interest received                                        180        3
    Funds provided by operations                            60,857   64,943
    Change in non-cash operating working capital          (41,424) (24,448)
    Cash provided by operations                             19,433   40,495
                                                                           
    Investing activities                                                   
    Purchase of property and equipment                    (31,206) (17,337)
    Proceeds from disposition of property and equipment     88,397      461
    Investment in joint venture                           (73,856)        -
    Change in non-cash working capital                       8,562    7,275
    Cash used by investing                                 (8,103)  (9,601)
                                                                           
    Financing activities                                                   
    Proceeds from long-term debt                                 -   10,949
    Repayments of long-term debt                                 - (29,138)
    Proceeds from exercise of options                          323        -
    Dividends paid                                         (6,906)  (6,043)
    Cash used by financing                                 (6,583) (24,232)
                                                                           
    Cash flow from operating, investing and financing    
    activities                                               4,747    6,662
    Effect of translation of foreign currency cash           5,162      197
    Increase in cash for the period                          9,909    6,859
                                                                           
    Cash and cash equivalents - beginning of period        268,160    4,933
    Cash and cash equivalents - end of period              278,069   11,792
    (1) Other includes share-based payment expense.
    SEGMENTED INFORMATION

The following presents the result of Trinidad's operating segments:
                                                                                                                   
    For three                     United States                                                           
    months ended                        /                                                                          
    March 31, 2014                                                   Joint                                
                      Canadian    International   Manufacturing     Venture    Inter-segment                       
    ($ thousands)                                                 Operations                              
                     Operations     Operations      Operations       (1)       Eliminations    Corporate     Total
                                                                                                                   
    Operating                                                                                             
    revenue             103,607         114,781          19,478            -               -           -    237,866
    Other revenue           722              46               8            -               -           -        776
    Third party                                                                                           
    recovery             14,522           5,683               -            -               -           -     20,205
    General and
    administrative                                                                                        
    - third party
    recovery                  -               -               -            -               -         282        282
    Inter-segment                                                                                         
    revenue                   -               -           9,913            -         (9,913)           -          -
    Elimination of
    downstream                                                                                            
    transactions              -               -         (7,624)            -               -           -    (7,624)
                        118,851         120,510          21,775            -         (9,913)         282    251,505
    Operating            54,300          70,972          17,766            -               -           -    143,038
    Third party                                                                                           
    costs                14,522           5,683               -            -               -           -     20,205
    Inter-segment                                                                                         
    operating                 -               -           9,913            -         (9,913)           -          -
    Elimination of
    downstream                                                                                            
    transactions              -               -         (6,930)            -               -           -    (6,930)
    Operating                                                                                             
    income               50,029          43,855           1,026            -               -         282     95,192
    Depreciation
    and                                                                                                   
    amortization         11,860          17,980             415            -               -           -     30,255
    Gain on sale                                                                                          
    of assets             (261)        (25,656)               -            -               -           -   (25,917)
    Elimination of
    downstream                                                                                            
    transactions              -          15,378               -            -               -           -     15,378
                         11,599           7,702             415            -               -           -     19,716
    Segmented                                                                                             
    income (loss)        38,430          36,153             611            -               -         282     75,476
    Joint venture                                                                                         
    loss                      -               -               -          131               -           -        131
    General and                                                                                           
    administrative            -               -               -            -               -      20,909     20,909
    General and
    administrative                                                                                        
    - third party
    costs                     -               -               -            -               -         282        282
    Foreign                                                                                               
    exchange                  -               -               -            -               -       3,154      3,154
    Finance costs             -               -               -            -               -       9,959      9,959
    Income taxes              -               -               -            -               -      15,279     15,279
    Net earnings                                                                                          
    (loss)               38,430          36,153             611        (131)               -    (49,301)     25,762
                                                                                                                   
    Purchase of
    property and                                                                                          
    equipment            13,037          18,105              64            -               -           -     31,206
     
    (1) The joint venture is recorded using the equity method of accounting. The Company's share of individual
    assets and liabilities are recognized as an investment on the consolidated statements of financial position,
    and revenues and expense are recognized with net earnings as a (gain) loss from investment in joint venture on
    the consolidated statements of operations and comprehensive income.
                                                                                                            
                                                                                                                   
    For three                     United States                                                           
    months ended                        /                                                                          
    March 31, 2013                                                   Joint                                
                      Canadian    International   Manufacturing     Venture    Inter-segment                       
    ($ thousands)                                                 Operations                              
                     Operations     Operations      Operations       (1)       Eliminations    Corporate     Total
                                                                                                                   
    Operating                                                                                             
    revenue             115,442         111,575             294            -               -           -    227,311
    Other revenue            44              22               -            -               -           -         66
    Third party                                                                                           
    recovery             13,701           6,108               -            -               -           -     19,809
    General and
    administrative                                                                                        
    - third party
    recovery                  -               -               -            -               -           -          -
    Inter-segment                                                                                         
    revenue                   -               -          11,362            -        (11,362)           -          -
    Elimination of
    downstream                                                                                            
    transactions              -               -               -            -               -           -          -
                        129,187         117,705          11,656            -        (11,362)           -    247,186
    Operating            59,591          69,014             413            -               -           -    129,018
    Third party                                                                                           
    costs                13,701           6,108               -            -               -           -     19,809
    Inter-segment                                                                                         
    operating                 -               -          11,362            -        (11,362)           -          -
    Elimination of
    downstream                                                                                            
    transactions              -               -               -            -               -           -          -
    Operating                                                                                             
    income               55,895          42,583           (119)            -               -           -     98,359
    Depreciation
    and                                                                                                   
    amortization         11,433          17,915             511            -               -           -     29,859
    Loss (gain) on                                                                                        
    sale of assets          141           (105)               -            -               -           -       36  
    Elimination of
    downstream                                                                                            
    transactions              -               -               -            -               -           -          -
                         11,574          17,810             511            -               -           -     29,895
    Segmented                                                                                             
    income (loss)        44,321          24,773           (630)            -               -           -     68,464
    Joint venture                                                                                         
    (gain) loss               -               -               -            -               -           -          -
    General and                                                                                           
    administrative            -               -               -            -               -      16,314     16,314
    General and
    administrative                                                                                        
    - third party
    costs                     -               -               -            -               -           -          -
    Foreign                                                                                               
    exchange                  -               -               -            -               -         (5)        (5)
    Finance costs             -               -               -            -               -       9,970      9,970
    Income taxes              -               -               -            -               -       9,437      9,437
    Net earnings                                                                                          
    (loss)               44,321          24,773           (630)            -               -    (35,716)     32,748
                                                                                                                   
    Purchase of
    property and                                                                                          
    equipment            16,910             363              64            -               -           -     17,337
     
    (1) The joint venture is recorded using the equity method of accounting. The Company's share of individual
    assets and liabilities are recognized as an investment on the consolidated statements of financial position,
    and revenues and expense are recognized with net earnings as a (gain) loss from investment in joint venture on
    the consolidated statements of operations and comprehensive income.
     
    ADVISORY

NON-GAAP MEASURES DEFINITIONS

This document contains references to certain financial measures and associated 
per share data that do not have any standardized meaning prescribed by IFRS 
and may not be comparable to similar measures presented by other companies.  
These financial measures are computed on a consistent basis for each reporting 
period and include EBITDA, EBITDA from investment in joint venture, Adjusted 
EBITDA, Adjusted EBITDA from investment in joint venture, Adjusted net 
earnings, working capital, Senior Debt to Bank EBITDA, Total Debt to Bank 
EBITDA, Bank EBITDA to Cash Interest Expense, drilling days, operating days, 
utilization rate - drilling day, utilization rate - operating day, and rate 
per operating day or dayrate.  These non-GAAP measures are identified and 
defined as follows:

"EBITDA" is a measure of the Company's operating profitability. EBITDA 
provides an indication of the results generated by the Company's principal 
business activities prior to how these activities are financed, assets are 
depreciated and amortized or how the results are taxed in various 
jurisdictions.

"EBITDA from investment in joint venture" provides an indication of the 
results generated by the Company's joint venture operations prior to how these 
activities are financed, assets are depreciated and amortized or how the 
results are taxed in various jurisdictions.

"Adjusted EBITDA" is used by management and investors to analyze EBITDA (as 
defined above) prior to the effect of foreign exchange, share-based payment 
expense, impairment expenses and the sale of assets. Adjusted EBITDA also 
takes into account the Company's portion of the principal activities of the 
joint venture arrangement by removing the loss (gain) from investment in joint 
venture and including Adjusted EBITDA from investment in joint venture. 
Adjusted EBITDA is not intended to represent net earnings as calculated in 
accordance with IFRS. Adjusted EBITDA provides an indication of the results 
generated by the Company's principal business activities prior to how these 
activities are financed, assets are depreciated, amortized and impaired, the 
impact of foreign exchange, how the results are taxed in various jurisdictions 
and effects of share-based payment expenses.

Adjusted EBITDA is calculated as follows:
                                                                   
    Three months ended March 31,                                        
    ($ thousands)                                            2014   2013
    EBITDA                                                 81,255 82,014
    Plus:                                                               
       Loss (gain) on sale of property and equipment     (10,539)     36
       Share-based payment expense                          5,575  2,791
       Foreign exchange                                     3,154    (5)
       Loss from investment in joint venture                  131      -
    Less:                                                               
       Adjusted EBITDA from investment in joint venture     (135)      -
    Adjusted EBITDA                                        79,441 84,836

"Adjusted EBITDA from investment in joint venture" is used by management and 
investors to analyze EBITDA (as defined above) prior to the effect of foreign 
exchange, share-based payment expense, impairment expenses and the sale of 
assets. Adjusted EBITDA from investment in joint venture is not intended to 
represent net earnings as calculated in accordance with IFRS. Adjusted EBITDA 
from investment in joint venture provides an indication of the results 
generated by the TDI's principal business activities prior to how these 
activities are financed, assets are depreciated, amortized and impaired, the 
impact of foreign exchange, how the results are taxed in various jurisdictions 
and effects of share-based payment expenses.

Adjusted EBITDA from investment in joint venture is calculated as follows:
                                                                   
    Three months ended March 31,                                   
    ($ thousands)                                        2014   2013
      EBITDA from investment in joint venture           (131)      -
      Less:                                                      
      Foreign exchange                                    (4)      -
      Adjusted EBITDA from investment in joint venture  (135)      -

"Adjusted net earnings" is used by management and the investment community to 
analyze net earnings prior to the effect of foreign exchange, share-based 
payment expense, any gains or losses on the sale of assets in the period and 
impairment charges, including taking into account the tax effects of these 
items. This measure is not intended to represent net earnings as calculated in 
accordance with IFRS. Adjusted net earnings is a useful measure because it 
provides an indication of results of the Company's principal business 
activities before consideration of fluctuations in foreign exchange gains and 
losses, impairment and share-based payment expenses, which are not 
consistently incurred period over period.

"Working capital" is used by management and the investment community to 
analyze the operating liquidity available to the Company.

"Senior Debt to Bank EBITDA" is defined as the consolidated balance of the 
revolving facility and other debt secured by a lien at quarter end to 
consolidated Bank EBITDA for the trailing 12 months (TTM).  Bank EBITDA used 
in this financial ratio is calculated as EBITDA plus impairment expense, loss 
(gain) on sale of property and equipment, loss (gain) from investment in joint 
venture, share-based payment expense and unrealized foreign exchange.

"Total Debt to Bank EBITDA" is defined as the consolidated balance of 
long-term debt, which includes the Senior Debt, Senior Notes Payable and 
dividends payable at quarter end, to consolidated Bank EBITDA for the TTM.  
Bank EBITDA used in this financial ratio is calculated as EBITDA plus 
impairment expense, loss (gain) on sale of property and equipment, loss (gain) 
from investment in joint venture, share-based payment expense and unrealized 
foreign exchange.

"Bank EBITDA to Cash Interest Expense" is defined as the consolidated Bank 
EBITDA for TTM to the cash interest expense on all debt balances for TTM.  
Bank EBITDA used in this financial ratio is calculated as EBITDA plus 
impairment expense, loss (gain) on sale of property and equipment, loss (gain) 
from investment in joint venture, share-based payment expense and unrealized 
foreign exchange.

"Drilling days" is defined as rig days between spud to rig release.

"Operating days" is defined as moving days (move in, rig up and tear out) plus 
drilling days (spud to rig release).

"Utilization rate - drilling day" is defined as drilling days divided by total 
available rig days.

"Utilization rate - operating day" is defined as operating days (drilling days 
plus moving days) divided by total available rig days.

"Rate per operating day" or "dayrate" is defined as operating revenue (net of 
third party costs) divided by operating days (drilling days plus moving days).

ADDITIONAL GAAP MEASURES DEFINITIONS

The Company uses certain additional GAAP financial measures within the 
financial statements and document that are not defined terms under IFRS to 
assess performance. Management believes that these measures provide useful 
supplemental information to investors. These financial measures are computed 
on a consistent basis for each reporting period and include Funds provided by 
operations, Operating income, Operating income percentage and Operating income 
- net percentage. These additional GAAP measures are identified and defined as 
follows:

"Funds provided by operations" is used by management and investors to analyze 
the funds generated by Trinidad's principal business activities prior to 
consideration of working capital, which is primarily made up of highly liquid 
balances. This balance is reported in the Consolidated Statements of Cash 
Flows included in the cash provided by operating activities section.

"Operating income" is used by management and investors to analyze overall and 
segmented operating performance.  Operating income is not intended to 
represent an alternative to net earnings or other measures of financial 
performance calculated in accordance with IFRS.  Operating income is 
calculated from the consolidated statements of operations and comprehensive 
income (loss) and from the segmented information contained in the notes to the 
consolidated financial statements. Operating income is defined as revenue less 
operating expenses.

"Operating income percentage" is used by management and investors to analyze 
overall and segmented operating performance, including third party recovery 
and third party costs, as well as inter-segment revenue and inter-segment 
operating costs. Operating income percentage is calculated from the 
consolidated statements of operations and comprehensive income (loss) and from 
the segmented information in the notes to the consolidated financial 
statements. Operating income percentage is defined as operating income divided 
by revenue.

"Operating income - net percentage" is used by management and investors to 
analyze overall and segmented operating performance excluding third party 
recovery and third party costs, as well as inter-segment revenue and 
inter-segment operating costs, as these revenues and expenses do not have an 
effect on consolidated net earnings. Operating income - net percentage is 
calculated from the consolidated statements of operations and comprehensive 
income (loss) and from the segmented information in the notes to the 
consolidated financial statements. Operating income - net percentage is 
defined as operating income less third party G&A expenses divided by revenue 
net of operating and G&A third party costs.

Trinidad is a corporation focused on sustainable growth that trades on the 
Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in 
the drilling and barge-drilling sectors of the North American oil and natural 
gas industry with operations in Canada, the United States and Mexico. 
Additionally, up until June 30, 2013, Trinidad's operations included coring 
rigs which have subsequently been sold. In addition, through a joint venture 
agreement signed in the current period, Trinidad has the opportunity to 
operate drilling rigs in other international markets such as Saudi Arabia.  
Trinidad is focused on providing modern, reliable, expertly designed equipment 
operated by well-trained and experienced personnel. Trinidad's drilling fleet 
is one of the most adaptable, technologically advanced and competitive in the 
industry.

FORWARD-LOOKING STATEMENTS

This document contains certain forward-looking statements relating to 
Trinidad's plans, strategies, objectives, expectations and intentions.  The 
use of any of the words "expect", "anticipate", "continue", "estimate", 
"objective", "ongoing", "may", "will", "project", "should", "believe", 
"plans", "intends", "confident", "might" and similar expressions are intended 
to identify forward-looking information or statements. Various assumptions 
were used in drawing the conclusions or making the projections contained in 
the forward-looking statements throughout this document. The forward-looking 
information and statements included in this document are not guarantees of 
future performance and should not be unduly relied upon.  Forward-looking 
statements are based on current expectations, estimates and projections that 
involve a number of risks and uncertainties, which could cause actual results 
to differ materially from those anticipated and described in the 
forward-looking statements. Such information and statements involve known and 
unknown risks, uncertainties and other factors that may cause actual results 
or events to differ materially from those anticipated in such forward-looking 
information or statements. In particular, but without limiting the foregoing, 
this document may contain forward-looking information and statements 
pertaining to the completion of announced rig construction programs on a 
timely basis and economical terms; the assumption that Trinidad's customers 
will honour their take-or-pay contracts; fluctuations in the demand for 
Trinidad's services; the ability for Trinidad to attract and retain qualified 
personnel, in particular field staff to crew the Company's rigs; the existence 
of competitors, technological changes and developments in the oilfield 
services industry; the existence of operating risks inherent in the oilfield 
services industry; assumptions respecting capital expenditure programs and 
other expenditures by oil and gas exploration and production companies; 
assumptions regarding commodity prices, in particular oil and natural gas; 
assumptions respecting supply and demand for commodities, in particular oil 
and natural gas; assumptions regarding foreign currency exchange rates and 
interest rates; the existence of regulatory and legislative uncertainties; the 
possibility of changes in tax laws; and general economic conditions including 
the capital and credit markets; assumptions made about future performance and 
operations of the joint venture arrangement. Trinidad cautions that the 
foregoing list of assumptions, risks and uncertainties is not exhaustive. The 
forward-looking information and statements contained in this document speak 
only as of the date of this document and Trinidad assumes no obligation to 
publicly update or revise them to reflect new events or circumstances, except 
as may be required pursuant to applicable securities laws.



SOURCE  Trinidad Drilling Ltd. 
Lyle Whitmarsh, Chief Executive Officer 
Brent Conway, President 
Lisa Ottmann Vice President, Investor Relations (403) 294-4401 
email:lottmann@trinidaddrilling.com 
To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/May2014/07/c6346.html 
CO: Trinidad Drilling Ltd.
ST: Alberta
NI: OIL ERN CONF  
-0- May/07/2014 21:29 GMT
 
 
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