exv99w1

Exhibit 99.1


		*Contacts:*		Joyce M. Schuldt, Executive VP & CFO
				Pioneer Drilling Company
				210-828-7689


FOR IMMEDIATE RELEASE		Lisa Elliott / lelliott@drg-e.com
		Anne Pearson / apearson@drg-e.comm
		DRG^&E / 713-529-6600

Pioneer Reports Second Quarter 2008 Financial Results

Second quarter revenues were up 48% to $152.5 million
and earnings per diluted share increased 46% to $0.38 over prior year

SAN ANTONIO, Texas, August 7, 2008 – Pioneer Drilling Company, Inc. (AMEX: PDC) today reported financial results for the three and six months ended June 30, 2008. As previously announced, the Company has transitioned to a December 31 fiscal year end; accordingly, the three months ended June 30 is reported as the second quarter of 2008.

Net income for the second quarter was $19.1 million, or $0.38 per diluted share, compared with net income of $11.8 million, or $0.24 per diluted share, for the three months ended March 31, 2008 (“the prior quarter”), and net income of $13.1 million, or $0.26 per diluted share, for the three months ended June 30, 2007 (“the year-earlier quarter”). The second quarter of 2008 included three months of operating results from our Production Services Division, which was formed on March 1, 2008 as a result of the acquisitions of the production service businesses of the WEDGE Group and Competition Wireline, as well as contributions from our Colombian operations, which commenced in the third quarter of 2007.

Revenues for the second quarter were $152.5 million, compared with $113.4 million for the prior quarter and $102.8 million for the year-earlier quarter. EBITDA⁽¹⁾ for the second quarter increased 47% to $53.4 million from the prior quarter and 50% from the year-earlier quarter. Additionally, the second quarter was impacted by a charge to selling, general and administrative expenses of approximately $1.0 million related to the Company’s investigation of internal control over financial reporting and a charge to interest expense of approximately $0.2 million related to bank fees and incremental interest for obtaining a debt covenant waiver.

Net income for the six months ended June 30, 2008 was $31.0 million, or $0.61 per diluted share, compared with net income of $30.3 million, or $0.60 per diluted share, for the six months ended June 30, 2007. Revenues for the six months of 2008 were $266.0 million, compared with $206.1 million for the comparable period in 2007. EBITDA for the six months of 2008 increased 18% to $89.6 million from the comparable period in 2007 of $76.0 million.

“Our Drilling Services and Production Services divisions both performed well in the second quarter,” said Wm. Stacy Locke, President and CEO. “Our drilling rig utilization and average margins per day for our Drilling Services division improved significantly from the prior quarter and our Production Services margins remained very solid. As a result of the strong demand in both divisions, we have approved the purchase of additional wireline units, fishing and rental equipment and in July, we secured a two-year term contract to build a land rig for the U.S. market. The rig, a 1500 horsepower SCR rig equipped with an automatic catwalk, iron roughneck and top-drive, is under construction and expected to be placed in service in December in the Rocky Mountain region.”

The Drilling Services Division contributed $109.3 million of revenues for the second quarter, an increase of $9.2 million over the prior quarter and $6.5 million over the year-earlier quarter. Drilling Services revenues improved due to an increase in rig utilization to 90%, as compared to 84% in the first quarter, and a 14% increase in the Drilling Services margin⁽²⁾ to $8,026 per day, up from $7,047 in the first quarter. Mr. Locke stated, “In June, dayrates reached their highest level so far this year and we anticipate continued improvement throughout the remainder of the year. In our international operations, we moved a fourth drilling rig into Colombia, which commenced drilling operations this week, and we are marketing another 1500 horsepower SCR rig that could be placed in service prior to year-end if we secure a drilling contract.”

The Production Services Division contributed revenues of $43.3 million in the second quarter, compared to $13.4 million for the one-month period in the first quarter of 2008. Mr. Locke further stated, “The Production Services Division is performing better than expected and generated a margin⁽²⁾ of 49% in the second quarter. We remain optimistic about the outlook for workover, wireline and fishing and rental services for the remainder of the year.”

Pioneer Conference Call

Pioneer’s management team will hold a conference call today at 2:00 p.m. Eastern Daylight Time (1:00 p.m. Central Daylight Time), to discuss these results. To participate in the call, dial (303) 205-0066 at least 10 minutes early and ask for the Pioneer Drilling conference call. A replay will be available approximately two hours after the call ends and will be accessible until August 14. To access the replay, dial (303) 590-3000 and enter the pass code 11118059#.

The conference call will also be available on the Internet at Pioneer’s Web site at www.pioneerdrlg.com. To listen to the live call, visit Pioneer’s Web site at least 10 minutes early to register and download any necessary audio software. An archive will be available shortly after the call. For more information, please contact Donna Washburn at DRG^&E at (713) 529-6600 or e-mail dmw@drg-e.com.

About Pioneer

Pioneer Drilling Company provides land contract drilling services to independent and major oil and gas operators in Texas, Louisiana, Oklahoma, Kansas, the Rocky Mountain region and internationally in Colombia though it’s Pioneer Drilling Services Division. The Company also provides workover rig, wireline and fishing and rental services to producers in the U.S. Gulf Coast, Mid-Continent and Rocky Mountain regions through its Pioneer Production Services Division. Its fleet consists of 69 land drilling rigs that drill at depths of 6,000 and 18,000 feet, 66 workover rigs (61 — 550 horsepower rigs, four 600 horsepower rigs and one 400 horsepower rig), 51 wireline units, and fishing and rental tools.

Cautionary Statement Regarding Forward-Looking Statements, non-GAAP Financial Measures and Reconciliations

Statements we make in this news release that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements that are subject to risks, uncertainties and assumptions. Our actual results, performance or achievements, or industry results, could differ materially from those we express in this news release as a result of a variety of factors, including general economic and business conditions and industry trends, the continued strength or weakness of the contract land drilling industry in the geographic areas in which we operate, decisions about onshore exploration and development projects to be made by oil and gas companies, the highly competitive nature of our business, difficulty in integrating the services of acquired companies, including the production services businesses of WEDGE and Competition, in an efficient and effective manner, the availability, terms and deployment of capital, the availability of qualified personnel, changes in, or our failure or inability to comply with, government regulations, including those relating to the environment, the economic and business conditions of our international operations, challenges in achieving strategic objectives, and the risk that our markets do not evolve as anticipated. We have discussed these factors in more detail in our transition report on Form 10-KT for the fiscal year ended December 31, 2007 and our quarterly report on Form 10-Q for the quarter ended March 31, 2008. These factors are not necessarily all the important factors that could affect us. Unpredictable or unknown factors we have not discussed in this news release, in our annual report on Form 10-K or in our quarterly reports on Form 10-Q could also have material adverse effects on actual results of matters that are the subject of our forward-looking statements. All forward-looking statements speak only as the date on which they are made and we undertake no duty to update or revise any forward-looking statements. We advise our shareholders that they should (1) be aware that important factors not referred to above could affect the accuracy of our forward-looking statements and (2) use caution and common sense when considering our forward-looking statements.

This news release contains non-GAAP financial measures as defined by SEC Regulation G. A reconciliation of each such measure to its most directly comparable GAAP financial measure, together with an explanation of why management believes that these non-GAAP financial measures provide useful information to investors, is provided below.


(1)		We define EBITDA as earnings before interest income (expense), taxes, depreciation and amortization. Although not prescribed under GAAP, we believe the presentation of EBITDA is relevant and useful because it helps our investors understand our operating performance and makes it easier to compare our results with those of other companies that have different financing, capital or tax structures. EBITDA should not be considered in isolation from or as a substitute for net income, as an indication of operating performance or cash flows from operating activities or as a measure of liquidity. A reconciliation of net income to EBITDA is included in the operating statistic table in this press release. EBITDA, as we calculate it, may not be comparable to EBITDA measures reported by other companies. In addition, EBITDA does not represent funds available for discretionary use.


(2)		Drilling Services margin represents contract drilling revenues less contract drilling operating costs. Production Services margin represents production services revenues less production services operating costs. We believe that Drilling Services margin and Production Services margin are useful measures for evaluating financial performance, although they are not measures of financial performance under generally accepted accounting principles. However, Drilling Services margin and Production Services margin are common measures of operating performance used by investors, financial analysts, rating agencies and Pioneer management. A reconciliation of Drilling Services margin and Production Services margin to net earnings is included in the operating statistics table in this press release. Drilling Services margin and Production Services margin as presented my not be comparable to other similarly titled measures reported by other companies.

- Financial Statements Follow –

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)


	Three months ended									Six months ended
	June 30,						March 31,			June 30,
	2008			2007			2008			2008			2007
Revenues	$	152,547		$	102,779		$	113,397		$	265,944		$	206,126


Costs and Expenses:
Operating Costs		86,193			62,388			70,426			156,619			121,578
Depreciation		20,580			16,098			17,119			37,699			30,834
Selling, general and administrative		12,150			4,724			7,722			19,872			8,547
Bad debt expense (recovery)		(92	)		—			135			43			—

Total operating costs		118,831			83,210			95,402			214,233			160,959


Operating income		33,716			19,569			17,995			51,711			45,167


Other income (expense):
Interest expense		(4,265	)		(1	)		(1,574	)		(5,839	)		(1	)
Interest income		205			862			585			790			1,743
Other		(930	)		20			1,092			162			28

Total other		(4,990	)		881			103			(4,887	)		1,770


Income before taxes		28,726			20,450			18,098			46,824			46,937

Income tax expense		(9,609	)		(7,362	)		(6,250	)		(15,859	)		(16,631	)


Net earnings	$	19,117		$	13,088		$	11,848		$	30,965		$	30,306


Earnings per share:
Basic	$	0.38		$	0.26		$	0.24		$	0.62		$	0.61

Diluted	$	0.38		$	0.26		$	0.24		$	0.61		$	0.60


Weighted average number of shares outstanding:
Basic		49,789			49,634			49,759			49,774			49,627
Diluted		50,483			50,212			50,291			50,369			50,167

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)


	June 30, 2008		December 31, 2007
	(unaudited)		(audited)
Assets
Current assets:
Cash and cash equivalents	$	18,069	$	76,703
Receivables, net		78,838		47,370
Contract drilling in progress		14,398		7,861
Deferred income taxes		6,243		3,670
Inventory		3,159		1,180
Prepaid expenses and other		5,854		5,073

Total current assets		126,561		141,857

Net property and equipment		575,344		417,022
Deferred income taxes		638		573
Goodwill		172,228		—
Other long-term assets		42,294		760

Total assets	$	917,065	$	560,212


Liabilities and Equity
Current liabilities:
Current maturities of long-term debt	$	13,811	$	—
Accounts payable		25,251		21,424
Income tax payable		3,640		—
Prepaid drilling contracts		1,789		1,933
Accrued expenses		35,291		18,693

Total current liabilities		79,782		42,050
Long-term debt		271,820		—
Other non-current liabilities		5,580		254
Deferred taxes		54,618		46,836

Total liabilities		411,800		89,140
Total shareholders’ equity		505,265		471,072

Total liabilities and shareholders’ equity	$	917,065	$	560,212

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)


	Six months ended
	June 30,
	2008			2007

Cash flows from operating activities:
Net earnings	$	30,965		$	30,306
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		37,699			30,834
Allowance for doubtful accounts		320			—
Loss (gain) on dispositions of property and equipment		(377	)		1,434
Stock-based compensation expense		1,848			1,662
Deferred income taxes		2,919			8,157
Change in other assets		256			5
Change in non-current liabilities		(168	)		(70	)
Changes in current assets and liabilities		1,964			9,214

Net cash provided by operating activities		75,426			81,542


Cash flows from investing activities:
Acquisition of WEDGE, net of cash acquired		(313,610	)		—
Acquisition of Competition Wireline, net of cash acquired		(26,101	)		—
Purchases of property and equipment		(58,936	)		(78,519	)
Proceeds from insurance recoveries		2,301			—
Purchase of auction rate securities, net		(16,475	)		—
Proceeds from sale of property and equipment		1,851			1,817

Net cash used in investing activities		(410,970	)		(76,702	)


Cash flows from financing activities:
Payments of debt		(32,170	)		—
Proceeds from issuance of debt		311,500			—
Debt issuance costs		(3,323	)		—
Proceeds from sale of common stock		653			217
Excess tax benefit of stock option exercises		250			73

Net cash provided by financing activities		276,910			290


Net increase (decrease) in cash and cash equivalents		(58,634	)		5,130

Beginning cash and cash equivalents		76,703			74,754

Ending cash and cash equivalents	$	18,069		$	79,884

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Operating Statistics
(in thousands)
(unaudited)


	Three months ended									Six months ended
	June 30,						March 31,			June 30,
	2008			2007			2008			2008			2007

Drilling Services Division:
Revenues	$	109,250		$	102,779		$	100,041		$	209,291		$	206,126
Operating costs		64,277			62,388			63,497			127,774			121,578

Drilling services margin (1)	$	44,973		$	40,391		$	36,544		$	81,517		$	84,548


Average number of drilling rigs		67.0			65.7			67.0			67.0			65.0
Utilization rate		90	%		90	%		84	%		87	%		90	%
Revenue days		5,603			5,387			5,186			10,789			10,590

Average revenues per day	$	19,498		$	19,079		$	19,291		$	19,399		$	19,464
Average operating costs per day		11,472			11,581			12,244			11,843			11,480


Drilling services margin per day (2)	$	8,026		$	7,498		$	7,047		$	7,556		$	7,984


Production Services Division:
Revenues	$	43,297		$	—		$	13,356		$	56,653		$	—
Operating costs		21,916			—			6,929			28,845			—

Production services margin (1)	$	21,381		$	—		$	6,427		$	27,808		$	—


EBITDA (3)	$	53,366		$	35,687		$	36,206		$	89,572		$	76,029


Reconciliation of combined Drilling services margin and Production services margin and EBITDA to net earnings:

Drilling services margin	$	44,973		$	40,391		$	36,544		$	81,517		$	84,548
Production services margin		21,381			—			6,427			27,808			—

Combined margin		66,354			40,391			42,971			109,325			84,548

General and administrative		(12,150	)		(4,724	)		(7,722	)		(19,872	)		(8,547	)
Bad debt (expense) recovery		92			—			(135	)		(43	)		—
Other income (expense)		(930	)		20			1,092			162			28


EBITDA		53,366			35,687			36,206			89,572			76,029

Depreciation		(20,580	)		(16,098	)		(17,119	)		(37,699	)		(30,834	)
Interest income (expense), net		(4,060	)		861			(989	)		(5,049	)		1,742
Income tax expense		(9,609	)		(7,362	)		(6,250	)		(15,859	)		(16,631	)


Net earnings	$	19,117		$	13,088		$	11,848		$	30,965		$	30,306


(1)		Drilling services margin represents contract drilling revenues less contract drilling operating costs. Production services margin represents production services revenue less production services operating costs. Pioneer believes that Drilling services margin and

		Production services margin are useful measures for evaluating financial performance, although they are not measures of financial performance under generally accepted accounting principles. However, Drilling services margin and Production services margin are common measures of operating performance used by investors, financial analysts, rating agencies and Pioneer’s management. A reconciliation of Drilling services margin and Production services margin to net earnings is included in the operating statistics table. Drilling services margin and production services margin as presented may not be comparable to other similarly titled measures reported by other companies.

(2)		Drilling services margin per revenue day represents the Drilling Services Division’s average revenue per revenue day less average operating costs per revenue day.

(3)		We define EBITDA as earnings before interest income (expense), taxes, depreciation and amortization. Although not prescribed under GAAP, we believe the presentation of EBITDA is relevant and useful because it helps our investors understand our operating performance and makes it easier to compare our results with those of other companies that have different financing, capital or tax structures. EBITDA should not be considered in isolation from or as a substitute for net income, as an indication of operating performance or cash flows from operating activities or as a measure of liquidity. A reconciliation of net income to EBITDA can be found later in the release. EBITDA, as we calculate it, may not be comparable to EBITDA measures reported by other companies. In addition, EBITDA does not represent funds available for discretionary use.

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Capital Expenditures
(in thousands)


											Budget
	Three months ended						Six months ended				Fiscal Year Ending
	June 30,				March 31,		June 30,				December 31,
	2008		2007		2008		2008		2007		2008

Capital expenditures:

Drilling Services Division:
Routine rigs	$	3,814	$	4,874	$	4,007	$	7,821	$	9,598	$	21,200
Discretionary		13,704		9,516		19,014		32,718		21,743		47,600
Tubulars		3		1,858		1,047		1,050		5,447		12,600
New-builds and acquisitions		1,087		35,658		746		1,833		45,145		20,000


Total Drilling Services Division capital expenditures		18,608		51,906		24,814		43,422		81,933		101,400


Average routine rig capital expenditures per revenue day (1)	$	681	$	905	$	773	$	725	$	906	$	998


Production Services Division:
Routine		835		—		108		943		—		2,030
New-builds and acquisitions		6,008		—		3,031		9,039		—		39,800


Total Production Services Division capital expenditures		6,843		—		3,139		9,982		—		41,830


Total capital expenditures	$	25,451	$	51,906	$	27,953	$	53,404	$	81,933	$	143,230


(1)		Average routine rig capital expenditures per revenue day represents the Drilling Services Division’s routine rig capital expenditures divided by the number of revenue days for each period presented.

PIONEER DRILLING COMPANY AND SUBSIDIARIES
Drilling Rig, Workover Rig and Wireline Unit Information


	Rig Type
	Mechanical		Electric		Total Rigs
Drilling Services Division:

Drilling rig horsepower ratings:
550 to 700 HP		6		—		6
750 to 900 HP		15		2		17
1000 HP		17		12		29
1200 to 1500 HP		3		14		17

Total		41		28		69


Drilling drilling depth ratings:
Less than 10,000 feet		8		2		10
10,000 to 13,900 feet		30		7		37
14,000 to 18,000 feet		3		19		22

Total		41		28		69


Production Services Division:

Workover rig horsepower ratings:
400 HP						1
550 HP						61
600 HP						4

Total						66


Wireline units						51


Fishing & Rental Tools Inventory					$14 Million

# # #