Good morning, ladies and gentlemen and welcome to the Oil States International third quarter 2008 earnings conference call. At this time all participants are in a listen-only mode. Later we will conduct a question and answer session. Please note that this conference is being recorded. I will now turn the call over to Mr. Bradley Dobson.

Thank you and thank you everyone for joining us. Welcome to the Oil States third quarter 2008 earnings conference call. Today our call will be led by Cindy B. Taylor, Oil States’ President and Chief Executive Officer. Before we begin we would like to caution listeners regarding forward-looking statements. To the extent the remarks today contain information other than historical information, we will rely on the Safe Harbor protection as afforded by Federal law. Any such remarks should be weighed in the context of the many factors that affect our business including those risks disclosed in our Form 10-K and our other SEC filings. I will now turn it over to Cindy.

Thank you, Bradley, and thanks to all of you for dialing into our call this morning. Oil States posted record earnings in the third quarter of 2008 which were significantly above first call estimates and our previous guidance range. We benefited from improved results from our tubular services segment as continued mill price increases and tight supplies for oil country tubular goods led to sequential improvements in both tonnage ships and gross margins. Our other North American businesses demonstrated improved revenues and margins which benefited from higher levels of drilling and completion activity and the recovery from spring break up in Canada. Our accommodations operation continued to grow with expanded capacity in the oil sands region. Offshore product had a good quarter despite experiencing some down time and inefficiencies associated with the two Gulf Coast hurricanes in the quarter. Overall I’m very pleased with our performance. As we indicated in the press release, we sold the final portion of our Boots & Coots common stock during the quarter and recognized a $3.5 million gain. Excluding this gain, Oil States reported revenues of $814.8 million and EBITDA of $168.7 million. Our revenues and EBITDA were up 55% and 78% year-over-year excluding these stock sale gains. Our very strong third quarter results have been overshadowed by the crisis in the credit markets, lower commodity prices, and declining stock prices. Given this environment we will spend a bit more time on the call today discussing our balance sheets, our liquidity picture, our outlook, and capital allocation alternatives. At this time, Bradley will take you through more details of our consolidated results and financial position and then I will come back on the line and conclude our prepared remarks with a discussion of each of our segments and close with our market outlook.

Throughout this call we will be excluding from our discussion of EBITDA the $3.5 million gain in the third quarter of 2008 and the $2.7 million gain in the second quarter of 2008 related to the sales of portions of our investment in Boots & Coots.. For the third quarter of 2008 we reported operating income of $141.5 million on revenues of $814.8 million. Our net income for the third quarter of 2008 totaled $89.1 million or $1.70 per diluted share. The comparable third quarter 2007 results were $74.8 million of operating income on revenues of $527.4 million. The third quarter of 2008 represents a 55% year-over-year increase in revenues and 89% year-over-year increase in operating income and record quarterly EPS for the company. These increases were primarily due to improved earnings from our tubular service segment and improved earnings from Canadian oil sands accommodations. Depreciation, amortization in the third quarter of 2008 totaled $27.3 million compared to $18.8 million in the third quarter of 2007. This increase was due to acquisitions and capital expenditures made over the past 12 months. G&A is expected to total $26.3 million in the fourth quarter of 2008. Net interest expense totaled $3.2 million in the current quarter and $3.3 million in the third quarter of 2007. Fourth quarter net interest expense is expected to be between $3.3 million and $3.7 million. The effective tax rate in the quarter was 37.1% compared to 30.3% in the third quarter of 2007. The higher tax rate was due to increased income in the US overall and higher US accommodations. We expect the effective tax rate in the fourth quarter to be between33% and 34%. During the third quarter we generated $118 million of cash flow from operations and spent approximately $71 million on capital expenditures. As…

Our Well Site Services segment generated revenues of $249.2 million and EBITDA of $84.1 million in the third quarter of 2008 compared to $209.9 million and $67.6 million respectively in the second quarter of 2008. The sequential increases in revenue and EBITDA were primarily due to continued growth in our oil sands accommodation and improved results in both our rental tools and drilling operations as US drilling and completion activity improved in the third quarter and Canadian activity recovered from spring break up. We remain at full effective utilization levels in 3 of our 4 major lodges but experienced typical seasonally reduced demand for our mobile camp assets. During the third quarter of 2008 we generated $65.8 million in revenues and $32 million in EBITDA from our oil sands accommodations operations. The expansion to Wapasu Creek Lodge which now has over 2300 rooms and the initial construction of the Fort Hills Lodge remained on schedule. Our rental tools generated $91.7 million of revenues and $30 million of EBITDA in the third quarter of 2008 compared to revenue of $84.6 million and EBITDA of $25.2 million in the second quarter of 2008. Our rental tool results benefited from a 6% sequential increase in US drilling and completion activities and the seasonal recovery from spring break up in Canada. These improvements were partially offset by down time, minor facility damage, and operational inefficiencies caused by the two Gulf Coast hurricanes which negatively impacted our rental tool revenues and EBITDA by approximately $1.7 million and $1.4 million respectively. Our drilling revenues and EBITDA were $52.1 million and $20.1 million respectively compared to $44.4 million of revenues and $15.6 million of EBITDA generated in the second quarter of 2008. This sequential improvement in revenues and EBITDA was primarily the result of improved utilization in…

(Operator Instructions) Your first question comes from Kevin Pollard.

I know you gave it, could you repeat the revenue and EBITDA from the oil sands? I missed it?

Sure, it was revenue of $65.8 million and EBITDA of $32 million.

Along the line that the oil sands, with crew prices coming in, we’ve seen a couple of the big Canadian oil sands operators talk about maybe not cutting back but slowing growth and slowing expansion. With that in mind, can you talk about how committed your facilities are in terms of contracts and such and how confident you are you can maintain the utilization in kind of the $70 or $75 oil environment?

There’s been a lot of recent press about all of the economic analysis in the oil sands projects. Some are more favorable than others. I’d like to focus maybe initially on what is very significant to our results in the next 12 months if you will. As I mentioned on the call, there are two things that the Wapasu Creek expansion as an example is tied to several operations but a lot of the growth right now is coming from the [sempor fire bag] project and they’ve recently come out that they are maintaining spending and construction time lines that are in place for both the third and fourth stages of that operation and so I feel very good about our outlook there with the additional rooms that we are adding at Wapasu. We do also a have a significant amount of that contracted. I don’t have it at the tip of my finger, the percentage for you, but obviously people are still concerned about having places for their people to stay and therefore are willing to write contracts for that. The other key one hasn’t been in the news a lot. It’s Petro Canada Fort Hills project and if you’ll recall, I don’t remember if it’s been two or three months ago, but we announced a new contract with Petro Canada for that project which is really the initial Phase I of that development and I think the key there, again as I noted, we will be proceeding with that, that is backed by a three year contract with Petro Canada and right now just broadly speaking kind of beyond that activity does remain strong; however, people are looking now at what the internal rates of return would be for these projects at oil that ranges anywhere from say…

Just to sort of summarize, would it be fair to say that you feel fairly confident that everything you plan or are going forward with as well as your existing capacity will be utilized to levels you expected? What’s maybe a little uncertain here the growth, the opportunities above and beyond your current facility expansions?

That’s exactly right and to put that into more tangible type thinking, what that means for me is we’re pretty comfortable if not very comfortable obviously for Q4 and the balance of 2009 feels very comfortable as well. Then you’ve got to say what about the expansion stages of these existing projects on; our customers are really talking 2011 and on at this stage, not the near term, say 15 months which right now with all the uncertainty in the market I think makes me feel pretty good in terms of where we stand and we can reassess what the market looks like a year from now on the other activities.

Okay, and you’re still expecting to have a strong utilization of your smaller camps in winter season in Q1?

We are looking, there’s every sign that the winter will be a fairly decent winter for drilling activities as is typical with Canada. People then begin to question what happens during and following break up but it does look like our conventional drilling fleet will be fairly well utilized. Again, we’ve been more heavily focused on the large mobile camp fleet which a lot of that really worked, in fact the drilling support operations in the oil sense anyway, so.

That was the part I was actually referring to, sort of the larger camps.

Yes, we do definitely believe there will be strong demand in the winter.

If I could shoot a real quick a question on tubular services; your shipment volume has been growing quite a bit faster the last couple of quarters than the rate count, I guess that would be, you’d been taking some share, so my question is if we start to see a fairly sharp decline in the rate count like I think most of us were expecting, does that reverse out a little bit or would you expect to sort of maintain the current share?

Well, I am glad you observed that and we clearly think we have been taking market shares in this environment, we are a very strong company with a good balance sheet and have a broad network with our customer operations and we do think the mill consolidation helps stabilize and support the market overall into a stronger market. I can’t say it’s necessarily less volatile. It will always be somewhat cyclical. It’s hard to say what happens when you go, if you have a material root count correction instead of having four months supply on the ground that will obviously move up fairly quickly and people, particularly the smaller private distributors, will look to start unloading some of that investment that they have, but overall there’s no reason to think that other than short term aberrations that we would not hold the market share gain that we’ve earned throughout both those weaker periods and strong periods that we’ve witnessed this year.

Okay, so just longer over the course of a full 12 or 18 month period, you wouldn’t expect the drop in shipment volume to be materially worse than the drop in drilling activity allowing for some one off aberrations that smaller distributors dumped inventory?

We don’t see any reason to think that.

Your next question comes from Victor Marchon - RBC Capital Markets.

First question I just had was on CapEx for next year. I know you had mentioned that you guys are currently evaluating, but I wanted to see if you had a rough estimate as to what you have on the books today for next year as it relates to the oil stands and everything else from a growth CapEx standpoint?

Okay, well right now it’s preliminary and subject to board approval and we’ll bring that up when we have our fourth quarter call but right now $200 million to $250 million of CapEx for 2009, the majority of that or right about 45% to 50% of that is accommodations related. We’ve got some expansion efforts and offshore products that will carry over into 2009; particularly our expansion in Singapore that we’re currently executing and then I think the rest of the capital expenditures will be very dependant, we’ll look at all of them as we look into budgeting season and then also as we execute them as to activity levels in North America and whether or not those expenditures are warranted.

The second one I had was just regarding the hurricane, regarding the post hurricane period. Are you guys seeing any meaningful pick up and activity whether it’s the pipeline repair or anything post the hurricanes that would be helpful over the next couple of quarters?

You know, we are getting some but it won’t be a mover in terms of overall total company activities. There were obviously damage in the Gulf but it’s not nearly as significant as what we saw with Katrina and Rita, but you’re right most of our activity is on the subsidy pipeline repair side and we have gotten some orders in the range of maybe $3 million to $5 million it looks like for repair equipment, but that’s kind of the order of magnitude that we’re looking at.

The last question is on the ship channel facility. I just wanted to see if you could update us as to where things stand there from taking on backlog becoming somewhat of a revenue generator as a standalone?

Well, it is a revenue generator generally and it’s kind of hard to climb onto and say it’s got a separate standalone backlog at this stage, but we’ve got a lot of work over there right now and we held backlog, so if you think about it, if you’ve got two facilities turning out revenue and you’re holding backlog, that’s an indication that facility is garnering work in and of itself so I’d say we’re getting there. There are some things that we need to do. We were certainly interrupted, that’s right in the heart of where a lot of the hurricane damage came through and so certainly interrupted a bit during the hurricane and the follow up impact however, we have recovered from it and we will have a little bit of facility repairs to make, but nothing of significance. I’d say it’s on track and that’s one of the focus areas for, seems to be our CapEx is to continue to bring that up to a fully functional standalone facility.

Your next question comes from Jeff Tillery - Tudor, Pickering, Holt & Co.. Jeff Tillery - Tudor, Pickering, Holt & Co.: I just wanted to make sure I understand the math on the convert, if all those notes converted at the $5.93 conversion price that’s basically $100 million? Is that right?

I believe that’s right, hold on one second. Yes, $104 million approximately. Jeff Tillery - Tudor, Pickering, Holt & Co.: Okay, I just wanted to make sure I was doing the math right. On the OCTG business, no pricing increase until early October, you talk about thinking margins might decline a little bit, do you think that no price increase holds? Is that an indication of how you’re thinking about pricing in that business?

Yes, and let me speak to that Jeff; that’s a tricky one and tricky to give guidance. I know every company out here feels that way because October was a very strong month with virtually no activity indicators whatsoever for us and probably many of our competitors. However, we’d be sticking our heads in the sand if we didn’t think the forward view had some impact and so we’re assuming that it will and typically impacts our tubular services and our drilling operations and as it related to tubular, we have price increases that took effect October 1. There’s no indication today that those price increases are not sticking and again, realize inventory on the ground is still very tight; it remains at four months supply so we don’t see anything today that suggests anything specific to OCTG. However, again, if we look into the months of November and December, we think it’s highly unlikely to see further price increases if our EMT customers do in fact lay some risks down, that inventory should build to a more comfortable level that we think at a minimum pricing flattens. We have to watch it as we will so I think my message there is, there’s nothing today in terms of activity either pricing or tonnage pricing that concerns us, but again, if we’re just watching the global impact on overall steel prices, we would have to think that over some period of time that could have some impact on OCTG pricing but certainly not now. Jeff Tillery - Tudor, Pickering, Holt & Co.: If we fast forwarded that for a couple of quarters and OCTG pricing was back at $1700 or $1800 a ton, has anything structurally changed in the business where your margins would be any different than the last time OCTG pricing was at that level?

Jeff, it’s anybody’s guess but it depends on what period or what cycle we’re talking about and let’s just go back to what we’ve always said; in a period of strong and rising prices, our margins typically expand. That could certainly prove to be the case during this year in a period where inventories are building and prices are contracting, our margins go down a bit. We saw that in 2007. Again the beauty of this business, our working capital adjusts downward materially, we generate a ton of cash and we make good money. Whether it goes down, I don’t know what period we’re saying is was low, but they should move down into the high single digit range would be my guess. Again, I go back to that overwriting fundamental, we do believe that the mill consolidations and the discipline in terms of overall mill productivity has made a difference in this business and certainly that seems to be proved out in late 2007 and 2008. Jeff Tillery - Tudor, Pickering, Holt & Co.: That makes sense. My last question is just on the oil fans accommodations business, how do you think about the customer base? Are you thinking about it on a project basis or are you thinking about it kind of new construction versus ongoing maintenanceing plans? I just want to see if you can provide a little color around what the customer base typically consists of?

Well it is both as you know. We’ve been involved to a certain degree, with the oil fans since the beginning in the 1989 time frame particularly with SynCrude and SunCore. Those are mature ongoing operations. SynCrude has a large mining operation at its Mildred Lake village facility. Of course a lot of growth, you go into a more stable maintenance mode in those older operations that are ongoing and we expect it will continue to be ongoing and then a lot of the growth has been with the new wave of investments that’s come in. Some are mining operations but a lot are the in situ type operations and you’ve got people like CNRL with their horizon project Optimax and [long light]. I could go on Husky Sunrise and others that are there, so we are very much focused on those particular developments and the manpower needs behind those developments. The challenge we face is the projection 5 years from now in terms of the ultimate build out of those operations and new and historically we’ve got a very close communication with our customer base and pretty good indications, but we also have in this particular business, contracts in place which really help us manage through it and feel pretty good about the capital investments that we’re making.

Your next question comes from Joseph Gibney - Capital One Southcoast.

I just wanted to follow up on the [inaudible] side of drilling. You guys have a utilization of 82% in the fourth quarter, just curious in your cash margin outlook here in the fourth quarter for the potential of some [inaudible] getting laid down.

What in, you’ve followed this business a long time, so what always happens in Thanksgiving and Christmas you’re going to have, if you finish a well, those are going to go down for that holiday. What has happened in other markets where we see a projected softening of activities, they’ll go down on Thanksgiving and some roads just won’t come back until the beginning of the year and we think that’s the environment we’re going to be saved with and therefore that’s why we’ve got to do about 82% utilization. Again, our utilization in October was very strong. There’s no reason to see anything but we also have been in this business a long time and have a pretty good understanding of what to expect. I don’t think, I know I don’t have in front of me what that implies in terms of cash margins per rig, but typically, obviously it will go down just because you don’t have that revenue base to absorb that cost with. I think we can go back. Bradley may work something up, I don’t know.

Yes. I think you’d look for about a 500 basis point of decline in margin percentages in that business.

On the [inaudible] 5% to 9% here obviously. Just curious, the different components of that service line are there other areas that are feeling it more than others, any particular geographic regions obviously on the Rockies? Any color there would be helpful.

I got to go back to what I’m trying to communicate. October was a strong month and you don’t see any activity decline today but in talking to our customer base, there are clear indications they are going to be taking some rigs out of market. When you lose rigs you obviously lose some of the service content. It is our belief based on conversations with our customer base that some of the more traditional areas of activity in west Texas and south Texas as an example, there are customers that have acknowledged they’ll be moving rigs out of the Barnett. Those are going to be a few of the markets I think are going to soften a bit. We haven’t seen it in the Rockies, but you know, with the Rockies Express essentially full we’ve already seen dislocations because of stranded gas again which nobody expected for a couple years but that market may have some issues to deal with but we do also see growth in some of the newer place such as the Haynesville, the [inaudible], the Marcellus, and again a lot of these newer locations are very service intensive with their operations and the drilling commitments need to be made on a lot of these new lease holds to hold them, so while we see some market softenings, we see other ones that are likely to move forward and do fairly well.

Bradley, just on your commentary there on the weakening of the Canadian dollar and its impact on earning into the fourth quarter, can you lay any kind of quantification on that or your expectations for how much that will impact your earnings here on the fourth [inaudible]?

I think it had about a $3 million or $4 million volume impact versus if it had stayed relatively flat.

Your next question comes from Brad Handler – Credit Suisse. Brad Handler – Credit Suisse: I am pinch hitting here for Arun Jayaram so forgive me here if the questions are a little bit basic but when you spoke about the oil sands accommodations and addressing the issue of risk, you talked only about expansion but maybe you could fill in a little bit with the nature, how much is contracted in your existing business and help me maybe understand a little bit about the nature of those contracts, for example, can you apply a take or pay logic to it, is there a minimum level of utilization, that sort of thing?

Yes. The contracts that we do have in place do have take or pay commitments to them. There’s no doubt, there’s kind of two areas of contribution; one is the room usage which is on take or pay type contracts the other one is the food service element which obviously is dependent on the number of people that are actually there working in the facility and eating meals there and we have some floors in our contract for some of that as well, so again, for the ongoing operations that are in process right now, again I just have to say we feel very comfortable with when we do our forecast for 2009, we look to those contracts, the take or pay nature of them in terms of our budgeting process so I am yes, more focused on the incremental new rooms that I’m bringing on. I just want to be sure that these new projects are going to be viable and that they’re going to move forward and we’re going to enjoy the utilization levels that we expect before we make that capital commitment. Brad Handler – Credit Suisse: That’s very helpful. So, in terms of existing, it sounds like existing 909 is existing a very high level or take or pay so there’s very little risk contractually or is it just that the projects themselves are ongoing operating and therefore presumably of very little risk?

A little bit of both but it’s weighted toward the comfort level that it’s backed by contract. Brad Handler – Credit Suisse: And I guess we are hearing about some projects that are not viable or at least being challenged to some degree, and again, forgive me, I’m not as well versed on this as I could be, but there are some, so it sounds like it’s more that you are aligned with some of your ongoing expansion with specific ones that are proceeding as opposed to some of the ones that perhaps won’t.

Absolutely and we’re going to be watching it very closely as we’ve indicated but I would comment on that too again, what our customer base is looking to do is to establish a different way to accomplish a lower cost environment both capital and operating in the event that, again, long term view, 30 year view of crude oil pricing. There’s a lot of subjectivity and uncertainty and they’re looking at ways to maybe share upgrading capacity, transport to other locations as opposed to every one of these projects building their own and quite frankly I think it helps us and helps our business model, again there has been a desire from some of our customers to build and own their own standalone facilities. We provide I think a very viable outsource alternative and that can be shared amongst many of these customers and many of these projects so to some degree I think it actually could favor our business model, if you will, but they’re looking for many things. Another key cost for a lot of the in situ development is natural gas and of course right now natural gas pricing has come back a bit. They’re looking for nuclear as an example for alternative so it is my view that it remains a very attractive source of energy going forward long term but it may require a different view in a different way to ensure the economics are found. Brad Handler – Credit Suisse: That’s helpful color as well. I guess one last one. Have SunCore or Petro Canada approached you with a respect to a, “Can you help us here because we are really trying to tighten the belt on every aspect of the project in light of the current environment”, has there been any of that kind of discussion?

If you’re asking me if they’ve asked us to renegotiate contracts or cut rights, no. They have not. They are still very concerned about how they are going to man and manage the specific phases that they plan to get underway and they know that right now there is more demand than there is supply for these types of accommodations facilities so to answer your question, no.

At this time I am showing no further questions.

Thank you so much and thanks to all of you for joining our call today. I know it has been a very busy day; a lot of people released earning and we appreciate your support and look forward to the next quarter.

Thank you ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may all disconnect.