Thank you, John. Good morning and welcome to Ensign Energy Services second quarter conference call and webcast.

On our call today is Bob Geddes, President and COO, and myself, Trevor Russell, Chief Financial Officer. Today we will review Ensign's second quarter highlights and financial results followed by our operational update and outlook.

We'll then open the call for questions. Our discussion today may include forward-looking statements based on current expectations that involve several business risks and uncertainties.

The factors that could result to differ materially include, but are not limited to, political, economic, and market conditions; crude oil and natural gas prices; foreign currency fluctuations; weather conditions; the company's defense of lawsuits; the ability of oil and gas companies to pay accounts receivable balances; or other unforeseen conditions that could impact the demand for services supplied by the company. Additionally, our discussion today may refer to non-GAAP financial measures such as adjusted EBITDA.

Please see our second quarter earnings release and SEDAR+ filings for information on forward-looking statements and the company's use of non-GAAP financial measures. With that, I'll pass it on to Bob.

Thanks, Trevor. We've had a busy quarter reactivating and upgrading rigs for contracts, which caused some one-time expenses in the quarter.

With respect to upgrades, in most cases, the operator has funded those upgrades in various areas of the world. We also announced the Citadel Drilling acquisition, which is expected to close next week and which will add six active 2,000-horsepower rigs to our Permian fleet.

We clipped another $30 million of debt in the quarter, and we continue to reduce our interest expense to 13%. We achieved this year-over-year improvement both on the top line and the bottom line with record operational safety results.

I'll turn it back to Trevor for a deeper dive on our first quarter financial results. Trevor?

Thanks, Bob. The oilfield services sector remains a generally constructive outlook as activity has improved year-over-year.

With the political and security situation in the Middle East, the disruption of shipping within the Strait of Hormuz, the continuing conflict between the Russian Federation and Ukraine, and the actions of the United States in Venezuela, the expectation is these factors and their continued development will have a direct effect on the industry. To date, oil and natural gas producers continue to moderate their capital spend, remain committed to cash flow generation, and maintaining current production levels.

Furthermore, the impact of uncertainty around the global economy and tariff policies adopted by the United States administration and the implications from such policies continue to impact operating activity. Operating days were up in the second quarter of 2026 in comparison to the second quarter of 2025.

The company saw a 7% increase in Canada to 2,667, a 5% increase in the United States to 3,088, and a 15% increase internationally to 1,246 operating days respectively. For the six months ended June 30th, 2026, overall operating days increased, with the United States recording a 10% increase and international recording an 8% increase in operating days.

Offsetting these increases was a 6% decrease in Canadian operating days when compared to the same period in 2025. The company generated revenue of $397.3 million in the second quarter of 2026, a 7% increase compared to the revenue of $372.4 million generated in the second quarter of the prior year.

For the six months ended June 30th, 2026, the company generated revenue of $815.4 million, a 1% increase compared to the revenue of $808.9 million generated in the same period in 2025. Adjusted EBITDA for the second quarter of 2026 was $85.8 million, 6% higher than the adjusted EBITDA of $81.4 million in the second quarter of 2025.

Adjusted EBITDA for the six months ended June 30th, 2026 totaled $180.7 million, 2% lower than adjusted EBITDA of $183.7 million generated in the same period in 2025. The 2026 increase in adjusted EBITDA was primarily due to higher operating activity.

Offsetting the increase is a 2% negative foreign exchange translation of converting dollar revenue-denominated revenue. Depreciation expense in the first six months of 2026 was $172.7 million, an increase of 5% compared to $164.7 million for the first six months of 2025.

General and administration expense in the second quarter of 2026 was 8% higher than in the second quarter of 2025. General and administration expenses increased primarily as a result of annual wage increases to various employees.

Offsetting the increase is a 2% translation effect of converting USD-denominated expenses. Interest expense decreased by 13% to $16.1 million from $18.6 million.

The decrease is the result of lower debt levels, effective interest rates, and the positive 2% translation effect of converting US-denominated interest expense. During the second quarter of 2026, $30 million of debt was repaid, and a total of 100 -- a total of 37 point -- $37 million was paid during the first six months of 2026.

The company has revised its previously announced debt reduction target of $125 million to a net $60 million. The revision is the result of the previously announced Citadel Drilling Limited acquisition and reinvesting into the company through capital expenditure.

If industry conditions change, these targets may be increased or decreased. Net purchases of property and equipment for the second quarter of 2026 totaled $58.1 million, consisting of $25.4 million in upgrade capital and $41.4 million in maintenance capital, offset by disposition proceeds of $8.7 million.

Our 2026 maintenance capital expenditure is set at approximately $162 million and selective upgrade capital of approximately $95.8 million, of which $68.6 million is customer-funded. The company continues to consider rig relocation or upgrade projects in response to customer demand and under appropriate contract terms, which may impact capital expenditures.

On that note, I will turn it back to Bob.

Thanks, Trevor. Let's circle the globe now with a summary of our second quarter and some insight into what we are seeing develop under this volatile yet still strong commodity pricing environment, starting with US drilling, which is our largest business unit.

Today we have 41 rigs under contract in the US and see that growing a rig a month till the end of the year. This is, of course, net of the Citadel fleet, which will add six rigs once closed.

We are seeing a more active bid book over the last few months, obviously the result of generally higher commodity prices, and we are seeing more private equity and new names to the game. At these prices, a lot more shoulder plays become more compelling.

Starting on the West Coast, moving east, we're seeing our California drilling asset base now with five high-spec ADR drill rigs under contract, with expectations of adding a couple more between now and year-end. We have eight rigs active in our Rockies division, same as last quarter, and we have 27 active today in our US Southern division.

The Permian continues to be our most active and prolific area, with continued strong demand for our high-spec ADR rigs, with an expectation that we should see four to five more rigs go to work between now and the year-end. Almost half our US rigs are on a performance-based contract, which elevates margin opportunities.

In Canada, we operate the second-largest fleet, which consists of a wide range of high-spec ADR drilling rigs, from singles to triples. In the first quarter, we mentioned that we had five of our high-spec ADR rigs come down early in the quarter for their five-year recertifications over breakup.

Those rigs are all out now, and we have 51 rigs active today in the Western Canadian Basin, up 17% year-over-year. Last year, we had 30 rigs active over breakup, building up to 43 into July.

This year, we ran roughly 45 rigs over breakup, jumping to 51 today, as I just mentioned. We expect to add a few rigs between now and the end of the year, and we are already seeing operators wanting to tie up our high-spec ADR rigs into spring 2027 and beyond.

We're not wanting to get our book too long in this upward demand construct, and we are starting to raise rates $1,000 per day per quarter as we move into the back half of the year and into next. On the international front, we now have 27 rigs in our international fleet with the addition of another high-spec ADR 1500 into Venezuela that came from our US Southern fleet and the commissioning of our fifth ADR into Oman.

The Middle East conflict has put a damper on continuing operations in the area, which has caused the shutdown of our two Kuwait rigs and our two Bahrain rigs. Oman remains generally unaffected, with all five of the five running there.

We have bids going in for the two 3,000-horsepower Kuwait rigs over the next few months, but that work wouldn't start until mid-2027. We also expect one of the two Bahrain rigs to be re-contracted in the immediate area before year-end.

In Australia, we have four rigs operating today, with a fifth rig starting up in the next 30 days. Argentina is steady with both our high-spec ADR 2000 under contract well into 2027.

Venezuela -- and let's talk about Venezuela. Everything changed back on January the 6th.

[cough] Ensign had the only two rigs running in the country, and we now have a third just landed in Venezuela, and we also signed a contract to add a fourth into Venezuela, which should hit the ground first part of 2027. These are all on three-year contracts.

Infrastructure buildup will determine how fast Venezuela is able to add rigs efficiently. In any case, our strategic positioning in Venezuela will provide great opportunities for Ensign moving forward.

On the well servicing side, we operate a fleet of 92 well service rigs in North America with roughly 50% utilization. We run 20 well service rigs daily in Canada, our highest level in years, and we run over 75% of our US well servicing rigs in our US well servicing business unit, primarily focused in the Rockies and California regions.

On the Ensign drilling rig automation, our EDGE growing rig control system platform is now on 65% of rigs globally and growing. We continue to see the opportunity to grow this business top line and bottom line by 15% year-over-year well into the future.

Our other business segments -- directional drilling, trucking, rentals, and managed pressure drilling -- continued to deliver steady revenue and margin with very little or no capital required. Back to the operator for questions.

Hey, good morning. Maybe we could just start out with the Citadel acquisition, required six rigs.

Bob, can you talk about the financial contribution from that acquisition as well as maybe the spec of the rigs themselves and the nature of the contracts they're on a little bit more, and any capital required for upcoming on those rigs?

I can't talk too much about that yet, Keith. We haven't closed yet, other than what is public documents.

They're 2,000-horsepower rigs, six of them. That's kind of all we can talk about at this point in time.

They're fully utilized at this point, though.

Got it. I know recognizing it hasn't closed yet, can you just talk about, maybe from your standpoint, what that acquisition brings to your rig fleet?

You obviously gain a little bit more Permian scale. Is that it, or is there some other factors we should be thinking about as far as bringing that larger footprint into Ensign?

No, you nailed it. They have a very nice rig platform designed for the Permian, and it increases our presence in the Permian.

It brings us up to about 11% of the Permian. We're running about 7% in the Permian right now, 7% to 8%, somewhere in there, it brings our Permian presence up to 11%, we become more important in the Permian.

You can draw some association into what we make in the US in the Permian and probably extract that over to the acquisition and pull some numbers out, but we just can't talk about some numbers until we close.

Fair enough. You mentioned pricing, raising at $1,000 a day per quarter in the US, assuming that's Canadian dollars, but correct me if I'm wrong.

Can we just talk a little bit more about what you're seeing as far as pricing going forward and are you seeing incremental demand from public companies yet or is it primarily been privates?

Certainly, the publics have shown at least some small demand increase. What's happening, I think, is you're seeing the drilling rig efficiency diminish down to single-digit efficiency gains these days, while the decline rates of certain reserves are accelerating a faster pace than they have thought.

Hanging on to production or slightly increasing production seems to be requiring a rig or two with most of the pubcos. The privcos are new, so that's net incremental new.

We're seeing a lot more of those show up. We're doing credit checks on them, and that's kind of our indication.

We're getting a lot more requests from companies that we haven't heard before, and they've raised some money and they're wanting a rig to go drill a six-month or one-year program. The demand is increasing, for sure.

The supply is also tightening up. Everyone wants the high-spec rig with at least 7,500 psi system, walking, and they want the high-torque top drive and three pumps.

This while we're also pushing some rigs over into Venezuela. Our what I'll call our lower-spec high-spec fleet is pushing over there, but the Citadel fleet dovetails nicely into what we see for Ensign an expanding market share place.

Copy that. I appreciate the color.

Thanks a lot.

Thanks, Keith.

Thanks for taking my questions. Just on the US, I think in your prepared remarks -- I was trying to write as fast as I could, but maybe I missed it.

Did you say you're running 41 rigs in the US today?

Correct.

That's not including the Citadel rigs, right? Correct.

Correct.

Including the Citadel rigs, you get to, I guess, 47, and then you're expecting to add four rigs essentially through the end of the year?

Correct.

Got it. Okay.

Then

secondly, can you talk a little bit about the pricing dynamics in Canada?

It all depends on the rig type. What we're finding is, if we start with the bottom end, the doubles and which encompasses some of the lower-end high-spec doubles, they're in the teens, the mid-teens.

The high-spec singles are in the low 20s, pushing to the mid-20s as that we're sold out of our high-spec singles at this point in time, obviously any new bids that we're getting, we're pushing pricing up with subject to availability. On the high-spec triples, we're in the low 30s all in, and we're running about 75% utilization in that category, and we're seeing more bids now starting to firm up for the winter.

In most cases, most clients have picked their dancing partners for the winter already, but we always see a few -- we've got one client who's wanting to pull some of 2027 capital into fourth quarter 2026. Those are kind of notional anecdotes.

Got it. It sounds like pricing in Canada is flatter than it is in the US.

Is that a fair remark?

I'd say it's flatter in the US, which is a challenge. In the US, there seems to be a little more discipline and understanding of the marketplace, and that's where the notion of increasing rates $1,000 a quarter we would contend is what we're trying to push for as well.

It's a little bit of a tight dance, depending on the client, etc., but certainly new bids going out for unknown clients and also clients who are repricing. Our costs have gone up a little bit as well, we've got to pass that on.

Of course, this is net of any labor increases or anything like that, which are covered by escalation clauses in the contract and --

Got it. All right.

Then following the Citadel acquisition, looking at the balance sheet, where do you think you're going to exit '27 now in terms of your leverage profile?

'27? Or '26?

Yeah. Sort of aspirational.

I know we don't know what '27 looks like yet, but just in terms of I guess medium-term deleveraging targets, how has the Citadel acquisition changed that? Maybe to say it more broadly.

What we're looking at,

our original debt reduction target for 2026 was $125 million. We have reduced that down to $60 million as a net number after the Citadel acquisition.

We're kind of building that in to the debt numbers there. We're expecting liquidity to kind of end up in that kind of low 90s or so by the end of the year of 2026, kind of get us back on track after the acquisition is completed.

Got it. Appreciate that.

That's all the questions I have.

Thanks, Tim.

Thanks, John. Despite the pricing volatility, the macro energy construct still remains strong for the oilfield service business as we continue to see our forward guaranteed contract book expand by 25% and our long-term contract runway now out to $1.4 billion of contracted revenue.

The industry keeps on finding ways to deliver value by reducing well times, although we are seeing diminishing returns with only single-digit gains in drill times. When we have equipment performing in higher duty and delivering more work on a daily basis, that value has for the last decade been captured generally by the operators and helped keep industry competitive globally.

Notwithstanding, as a result, contractors' daily costs have increased, with replacement equipment costs going up, it's time for contractors to capture the value creation generated over the last decade. With that, and with tightening supply of high-spec rigs, we see rates moving roughly 5% to 10% on contract rollovers as we move through into the future.

This will help contractors monetize into the future the value we've created over the last decade. We'll see where oil pricing lands, but it is certainly landing up from where it was, and with very little excess rig equipment capacity and lead times on new rig equipment getting out there close to a year, the market construct looks very promising for Ensign and the industry in general.

Chat in three months. Thank you for joining the call today.