Organic Growth Opportunities Management believes that there are numerous opportunities that can be leveraged using the Companys solid operating platform and provide further organic growth including i continued geographic expansion into areas of intense underground drilling such as the R ed L ake district in Ontario and the A thabasca Basin in Saskatchewan and areas where there is a demand for surface drilling such as western Canada the United States Mexico and South America ii leveraging of existing relationships to promote and crosssell the Companys drilling capabilities iii continued focus on expanding the amount of specialized drilling iv leveraging of the Companys position as a market leader to attract new customers and v focus on exploiting favourable trends within the mining industry to attract new projects Consolidation Opportunities In addition to its strong organic growth the Company believes that there are many consolidation opportunities available to it The drilling services industry is highly fragmented and the Company is aware of many small regional domestic and international competitors many of whom offer unique specialized drilling services that may be attractive investments Three acquisitions have been successfully integrated since January 31 2007 including the acquisition of Orbit by Garant in January 2007 the acquisition of the reverse circulation drilling business carried on by Drift in April 2007 and the acquisition of R A Mecatech Ltd in December 2007 through which Soudure R oyale increased its manufacturing capacity The Company also has identified a number of potential further opportunities Management plans to take advantage of the Companys strong market position and excellent reputation as well as favourable market conditions to further consolidate the industry The Company intends to continue to pursue acquisition opportunities that will enable it to expand its international operations leverage its overhead and expand the scope of drilling services offered to its clients Infrastructure to Support Growth Management intends to leverage the Companys large drill base and ability to add capacity by producing new drills to grow its business The 85 underground drills owned by the Company include 63 electric hydraulic drills and 22 air drills The Company has 25 hydraulic surface drills two conventional surface drills and four surface reversecirculation rigs The Companys drill portfolio includes all seven underground drills and three of the four surface drills that the Company committed to add in the current fiscal year The Board of Directors recently approved the fiscal 2009 capital budget which plans for the addition of 18 drills to the Companys existing fleet The Company regularly refurbishes its drills every five to seven years in order to continually extend their useful life P roducts and Services Surface Drilling The Company provides surface drilling services both diamond core drilling and reverse circulation drilling to domestic and international clients The surface drilling contracts for which the Company competes often involve operating in harsh environments such as desert terrain rain forests swampland high altitudes Arctic climates or remote locations Each prospective project is evaluated by the Company based upon the complexity of the work required and a proposed package of equipment drill methods and procedures is then presented to the customer W orking with the engineering department at Soudure R oyale the Company designs or modifies a rig to meet the specific requirements of its customers such as heliportable drill rigs In addition to providing conventional surface drilling services the Company offers the following specialized surface drilling services deep hole drilling 2500 metres and beyond directional drilling and large diameter drilling using PQsized 4 7 8 inches drilling diameter drill bits Management believes that the average surface drilling contract is between 5000 and 10000 metres and takes six to 12 months to perform 33