Precision Drilling Corp reported a profit for the fourth straight quarter, helped by an increase in rates and drilling utilization days, and raised its capital budget for the second time in as many months.

Canada's largest oil and gas drilling contractor said it continued to see strong demand for its rigs, driven by a boom in drilling for shale gas and oil prospects across the continent.

Precision, whose peers include Trinidad Drilling Ltd and Ensign Energy Services Inc , now expects 2011 capital expenditures of about C$841 million ($890.5 million), up from its earlier forecast of C$790 million.

The company said demand for services in Canada and the United States would continue to grow as oil and gas liquids drilling and well servicing activity continues to grow.

Customer drilling programs delayed by the wet Canadian spring have served to further enhance demand for the second half of the year as the weather improves, said the company, which booked 21 rigs during the second quarter.

"As contracted rigs roll off into a stronger spot market pricing environment and our new build and upgrade rigs enter the markets , we expect to see continued improvements in our average revenue per day throughout the year," Chief Executive Kevin Neveu said in a statement.

For the second quarter, the U.S. crude benchmark, West Texas Intermediate crude oil CLc1, averaged $102.55 per barrel, 32 percent higher than the year-ago period, the company said.

Precision earned C$16.4 million, or 6 Canadian cents a share, compared with a net loss of C$69.4 million, or 25 Canadian cents a share, a year ago, which included a C$26 million foreign exchange loss.

Revenue rose 32 percent to C$345.3 million.

Analysts, on average, were expecting earnings of 7 Canadian cents a share, on revenue of C$329.8 million, according to Thomson Reuters I/B/E/S.

In Canada, average revenue per day increased 14 percent over the year-ago period, while average revenue per day was up 18 percent in the United States.

In the second quarter, average drilling rig revenue per day rose to $22,080 in the company's U.S. operations and to C$18,461 in the Canadian operations.

Precision shares closed at C$15.39 on Thursday on the Toronto Stock Exchange. They have climbed 57 percent this year. ($1 = 0.944 Canadian Dollars)

Source: Reuters

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