Energy Service Sector Survey (ESSS) report for the first quarter of 2008

ESSS Q1 2008 The ESSS is conducted on a quarterly basis by the STCIC executive office. The ESSS for Q1 2008 was conducted in April / May 2008. Twenty One (16) companies returned questionnaires.

Optimism Levels 25% of respondents said that they were more optimistic in Q1 2008 than they were in Q4 2007. This compares to 20% who said that they were more optimistic in Q4 2007 than they were in Q3 2007. The majority of respondents (56%) had no change in their level of optimism over the previous quarter. The next slide shows optimism over the last 7 quarters.

Optimism Falling

Charges Cost & Profitability in Q1 2008 Selling prices: 50% (38% )of respondents said that average selling prices were up in Q4 2007; 38% (57%) said it had remained the same and 13% said that selling prices declined. Total Cost per employee: 50% (67% )of respondents said that the total cost per employee had increased; 25% (33%) said that it was the same. Overall profitability: 13% (29%) of respondents said that overall profitability had increased; 50% (43%) said it stayed the same; and 38% (29%) reported a decrease. *Note the figures in brackets were reported in the previous quarter: Q4 2007

Employment and Training in Q3 2007 Numbers employed: 50% (40% )of respondents reported numbers employed as increasing in Q1 2008; 44% (50%)reported no change; and 6% (10%)reported a decrease in numbers employed. Full Time employment: 31 % (29%)reported increases in full time employment; 69% (62%)reported no change; and 0 % (10%)reported a decline in full time employment. Part Time employment: 53% (45%)of respondents reported an increase in part time employment; 47% (40%)reported no change and 0 % (15%)reported a decrease. Training expenditure: 64 % (57%) of respondents reported an increase in training expenditure in Q1 2008 while 29% ( 29%) reported no change; 7 % (10%) respondent reported a decline. Note: The figures for Q4 2007 are in brackets

Trend in employment in the energy service sector as reported in various ESSS reports Table 1: Employment in the Energy Service Sector Quarter % saying employment is up % saying no change in employment % saying employment is down Q1 2007 33 48 19 Q2 2007 37 26 Q3 2007 53 42 5 Q4 2007 40 50 10 Q1 2008 44 6

Capital Expenditure in the next 12 months compared to past 12 months Capital Expenditure (Capex) is categorized into 3 areas: Land and Building Information Technology Plant/Equipment/Vehicle Results for Q1 2008 are shown in table below. Q4 2007 results are in parentheses. Area More Capex authorizations No Change in Capex authorizations Less Capex authorizations Land 53%, (67%) 47%, (24%) 0%, (20%) Information Technology 81%, (76%) 19%, (24%) 0%, (0%) Plant/Equipment/ Vehicle 80%,( 76%) 20%, (19%) 5%, (5%)

Conclusion The results of the Energy Service Sector Survey for Q1 2008 indicates that the energy services sector’s optimism is not as buoyant as it was in mid – 2007. Most companies responded that that there was no change to their level of optimism. The sector continues to be constrained by increasing cost, unavailability of labour (technical and professional) and by competition from foreign energy services companies. In the face of these challenges the energy services sector continues to show growth through increases in employment and Capex.