AUGUST 8, 2002 – SAN ANTONIO, TEXAS – Pioneer Drilling Company (AMEX: PDC) today reported results for the three months ended June 30, 2002.

Revenues for the first quarter of 2003 were $18.4 million compared to revenues of $18.3 million in the first quarter of 2002. Earnings before interest, taxes, depreciation and amortization, or EBITDA, was $2.9 million in the first quarter of 2003 compared to $6.9 million in the same period last year. Net loss attributable to common shareholders in the first quarter of 2003 was $171,600, or $0.01 per share, versus net income of $3.1 million or $0.20 per diluted share during the first quarter of 2002. Results reflect an increase in turnkey contracts during the first quarter of 2003, which generate higher drilling costs as well as higher revenue than daywork contracts. While revenues remained flat year over year, EBITDA declined as a result of decreasing profitability in both turnkey and daywork contracts.

Revenue days were 1,453 days during the first quarter of 2003 compared to 1,441 days for the first quarter of 2002 while drilling margins were 18.2 percent, or $3.3 million, versus drilling margins of 42.2 percent, or $7.7 million in the first quarter of 2002. Average rig utilization for the first quarter was 77 percent, down from 98 percent last year, primarily due to the negative effect of lower oil and gas prices on rig demand.

Michael E. Little, Pioneer Drilling’s Chairman and Chief Executive Officer, stated, “With demand for land rigs remaining weak, we continue to work hard to keep our crews busy and pursue opportunities to maintain and increase our utilization.”

In accordance with the American Stock Exchange (AMEX) Company Guide, the Company wishes to explain the reasons underlying the exception to the AMEX rules referenced in our Proxy Statement dated July 10, 2002 allowing Mr. James M. Tidwell to be a member of the audit committee of our board of directors even though he is not considered an “independent” director under AMEX guidelines. Mr. Tidwell is not considered “independent” because he is the Chief Financial Officer of one of our affiliates, WEDGE Energy Services, L.L.C. We have obtained the exception to AMEX independence rules because we believe that Mr. Tidwell's extensive experience, spanning more than 10 years, as the chief financial officer of several companies in the oil and gas industry is the necessary background to properly oversee our relationship with our auditors, KPMG. Further, Mr. Tidwell's financial background serves as a good complement to the operations consulting and investment banking backgrounds of Mssrs. Dean Burkhardt and John Thompson, respectively, the other members of our audit committee. Therefore, our board of directors has determined that Mr. Tidwell's membership on its audit committee is required by the best interests of Pioneer Drilling Company and its shareholders.

Pioneer Drilling’s management team will be holding a conference call on Thursday, August 8, 2002, at 11:00 a.m. Eastern time. To participate in the call, dial (303) 262-2144 at least ten minutes before the conference call begins and ask for the Pioneer Drilling conference call. A replay of the call will be available approximately two hours after the call ends and will be accessible until August 15, 2002. To access the replay, dial (303) 590-3000 and enter the pass code 490562.

Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by accessing Pioneer Drillings web site at http://www.pioneerdrlg.com. To listen to the live call on the web, please visit Pioneer Drilling’s web site at least fifteen minutes early to register, download and install any necessary audio software. For those who cannot listen to the live web cast, an archive will be available shortly after the call. For more information, please contact Karen Roan at Easterly Investor Relations at (713) 529-6600 or email karen@easterly.com.

Pioneer Drilling Company provides contract land drilling services to independent and major oil and gas operators drilling wells in central, south and east Texas. The Company’s fleet consists of 22 land drilling rigs that drill in depth ranges between 10,000-18,000 feet, with three additional 1500 HP SCR land rigs scheduled to be added in September 2002, November 2002 and January 2003.

This press release contains various forward-looking statements and information that are based on management’s belief as well as assumptions made by and information currently available to management. Forward-looking information includes statements regarding the Company’s anticipated growth, demand from the Company’s customers, capital spending by oil and gas companies and the Company’s expectations regarding its new rigs. 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, 2002.

Statements of Operations - Unaudited Three Months Ended 6/30/20026/30/2001

Revenues:
Contract drilling18,431,177$ 18,267,805$
Other11,940 29,976
Total operating revenues18,443,117 18,297,781

Costs & Expenses:
Contract drilling15,082,302 10,538,735
Depreciation2,688,281 1,612,319
General & adm.507,885 854,426
Total operating costs18,278,468 13,005,480
Operating profit (loss)164,649 5,292,301

Other income (expense):
Interest expense(559,790) (304,184)
Interest income23,551 12,342
Gain on sale of securities203,887 - Total other (332,352) (291,842)
Earnings before taxes(167,703) 5,000,459
Income taxes3,898 1,826,210
Net income(171,601) 3,174,249
Preferred dividends- 60,000
Net to common(171,601)$ 3,114,249$
Earnings (loss) per share: Basic(0.01) 0.23
Diluted(0.01) 0.20

Weighted average number of shares outstanding:
Basic15,953,997 13,357,459 Diluted15,953,997 16,188,765

Operating statistics:
Utilization rate77.0%98.0%
Revenue days1,453 1,441
Drilling margin3,348,875$ 7,729,070$
Drilling margin/day2,305$ 5,364$
Drilling margin % of revenue18.2%42.2%
EBITDA2,852,930$ 6,904,620$
EBITDA as % of revenues15.5%37.7%

Condensed Consolidated Balance Sheets - Unaudited 6/30/2002 3/31/2002

Assets
Total current assets17,257,808$ 16,516,218
Net property, plant and equipment73,991,590 66,731,626
Other assets206,907 201,914
Total assets91,456,305$ 83,449,758
Liabilities and EquityTotal current liabilities17,705,698$ 16,817,491
Long-term debt 32,633,676 26,118,601
Deferred taxes7,960,453 7,170,661
Total shareholders' equity33,156,478 33,343,005 91,456,305$ 83,449,758