MARCH 5, 2004 – SAN ANTONIO, TEXAS – Pioneer Drilling Company (AMEX: PDC) today announced that it has completed the acquisition of the drilling assets of Sawyer Drilling & Services, Inc., based in Shreveport, Louisiana. Pioneer paid $12 million for the seven rig drilling fleet and related yard equipment. The fleet consists of seven mechanical 700 to 1200 horsepower rigs, capable of drilling to depths of 8,000 to 14,000 feet.

Wm. Stacy Locke, Pioneer Drilling’s President and Chief Executive Officer, stated, “Sawyer Drilling has been a well run drilling contractor for 44 years and has operated in east Texas, north Louisiana and south Arkansas. We expect a majority of Sawyer Drilling’s field personnel to join us and continue working from Pioneer’s East Texas Division. This acquisition has increased the fleet in the East Texas Division to 18 rigs.”

Mr. Locke added, “All seven rigs are currently performing turnkey contracts in east Texas. Pioneer has entered into an agreement to provide six of the rigs on a daywork basis to Sawyer Drilling to complete the turnkey jobs in progress. We estimate that while on daywork to Sawyer Drilling, each of these rigs will generate a maximum of $800 margin per day. Most of the jobs in progress will be completed by March 31, 2004, but these relatively low margins will negatively impact our previously anticipated drilling margin for the month of March. Once the jobs in progress are completed, Pioneer will be drilling Sawyer’s backlog of contracts on a turnkey basis, which we expect to be more profitable.”

Additionally, Pioneer announced the purchase of the assets of A&R Trejo Trucking. Pioneerpaid $1.2 million for 23 trucks and related rig moving assets. Roughly one-half of the assets will be operated from the Company’s South Texas Division trucking yard and the reminder will be moved to the East Texas Division later this year. Mr. Locke stated, “We expect that the additional rig moving equipment will significantly reduce our rig mobilization costs.”

Pioneer Drilling Company provides land contract drilling services to independent and major oil and gas operators drilling wells in north, east and south Texas and north Louisiana. The Company’s fleet consists of 35 land drilling rigs that drill in depth ranges between 8,000-18,000 feet.

CONTACTS:
Wm. Stacy Locke, President & CEO
Pioneer Drilling Company
210-828-7689

Ken Dennard / ksdennard@drg-e.com

Lisa Elliott / lelliott@drg-e.com

DRG&E / 713-529-6600

This press release contains various forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the statements regarding the expectation of Sawyer Drilling’s field personnel joining the Company, the estimated margins per day to be generated by the acquired rigs in March 2004 and the impact of those margins on the Company’s overall margin for March 2004, our expectations regarding the profitability of Sawyer Drilling’s backlog and our expectation that the newly acquired rig moving assets will significantly reduce our rig mobilization costs. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Such statements are subject to certain risks, uncertainties and assumptions, including, among other matters: general and regional economic conditions and industry trends; the continued strength or weakness of the contract land drilling industry in the geographic areas where the Company operates; decisions about onshore exploration and development projects to be made by oil and gas companies; the highly competitive nature of the contract land drilling business; the Company’s future financial performance, including availability, terms and deployment of capital; the continued availability of qualified personnel; and changes in governmental regulations, including those relating to the environment. Should one or more of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. These risks, as well as others, are discussed in greater detail in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K for the fiscal year ended March 31, 2003 and subsequent Form 10-Q’s.