|   | [x]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR15(d) |
|--------|----------------------------------------------------------|

|   | OF      THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|---------------------------------------------|

|   | OR |
|--------|----|

|   | [  ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR  15(d) |
|--------|------------------------------------------------------------------------|

|   | OF      THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|---------------------------------------------|

|   | Delaware                                            | 73-1283193                                |
|--------|-----------------------------------------------------|-------------------------------------------|
|   | (State      or other jurisdiction of incorporation) | (I.R.S.      Employer Identification No.) |

|   | 7130      South Lewis, Suite1000,      Tulsa,      Oklahoma | 74136           |
|--------|-------------------------------------------------------------|-----------------|
|   | (Address      of principal executive offices)               | (Zip      Code) |

|   | (918) 493-7700                                                 |
|--------|----------------------------------------------------------------|
|   | (Registrant’s      telephone number, including areacode) |

|   | None                                                      |
|--------|-----------------------------------------------------------|
|   | (Former      name, former address and former fiscal year, |
|   | if      changed since last report)                        |

|   | Yes      [x] | No      [  ] |
|--------|--------------|------------------------|

|   | Yes      [  ] | No      [  ] |
|--------|-------------------------|------------------------|

| Large      accelerated filer [x] | Accelerated      filer [  ] | Non-accelerated      filer [  ] | Smaller      reporting company [  ] |
|----------------------------------|---------------------------------------|-------------------------------------------|-----------------------------------------------|

|   | Yes      [  ] | No      [x] |
|--------|-------------------------|-------------|

|   |          |                                                                  | Page   |
|--------|---------------|-----------------------------------------------------------------------|--------|
|   |          |                                                                  | Number |
|   |          | PART      I. Financial Information                                    |   |
|   |          |                                                                  |   |
|   | Item      1.  | Financial      Statements (Unaudited)                                 |   |
|   |          |                                                                  |   |
|   |          | Condensed      Consolidated Balance Sheets                            |   |
|   |          | March      31, 2009 and December 31, 2008                             | 3      |
|   |          |                                                                  |   |
|   |          | Condensed      Consolidated Statements of Operations                  |   |
|   |          | Three      Months Ended March 31, 2009 and 2008                       | 5      |
|   |          |                                                                  |   |
|   |          | Condensed      Consolidated Statements of Cash Flows                  |   |
|   |          | Three      Months Ended March 31, 2009 and 2008                       | 6      |
|   |          |                                                                  |   |
|   |          | Condensed      Consolidated Statements of Comprehensive Income (Loss) |   |
|   |          | Three      Months Ended March 31, 2009 and 2008                       | 7      |
|   |          |                                                                  |   |
|   |          | Notes      to Condensed Consolidated Financial Statements             | 8      |
|   |          |                                                                  |   |
|   |          | Report      of Independent Registered Public Accounting Firm          | 20     |
|   |          |                                                                  |   |
|   | Item      2.  | Management’s      Discussion and Analysis of Financial          |   |
|   |          | Condition      and Results of Operations                              | 21     |
|   |          |                                                                  |   |
|   | Item      3.  | Quantitative      and Qualitative Disclosure About Market Risk        | 40     |
|   |          |                                                                  |   |
|   | Item      4.  | Controls      and Procedures                                          | 41     |
|   |          |                                                                  |   |
|   |          | PART      II. Other Information                                       |   |
|   | Item      1.  | Legal      Proceedings                                                | 41     |
|   |          |                                                                  |   |
|   | Item      1A. | Risk      Factors                                                     | 41     |
|   |          |                                                                  |   |
|   | Item      2.  | Unregistered      Sales of Equity Securities and Use of Proceeds      | 42     |
|   |          |                                                                  |   |
|   | Item      3.  | Defaults      Upon Senior Securities                                  | 42     |
|   |          |                                                                  |   |
|   | Item      4.  | Submission      of Matters to a Vote of Security Holders              | 42     |
|   |          |                                                                  |   |
|   | Item      5.  | Other      Information                                                | 42     |
|   |          |                                                                  |   |
|   | Item      6.  | Exhibits                                                              | 42     |
|   |          |                                                                  |   |
|   | Signatures    |                                                                  | 43     |

|                                                                                                                              |   | March      31,                           |      |   |   | December      31, |   |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|-----------|--------|--------|-------------------|--------|
|                                                                                                                              |   | 2009                                     |      |   |   | 2008              |   |
|                                                                                                                              |   | (In      thousands except share amounts) |      |
| ASSETS                                                                                                                            |   |                                     |      |   |   |              |   |   |   |
| Current      assets:                                                                                                              |   |                                     |      |   |   |              |   |   |   |
| Cash      and cash equivalents                                                                                                    |   | $                                        | 1,012     |   |   |              | $      | 584 |   |
| Restricted      cash                                                                                                              |   |                                     | 20        |   |   |              |   | 20 |   |
| Accounts      receivable, net of allowance for doubtful accounts of $4,893 at March 31,      2009 and $4,893 at December 31, 2008 |   |                                     | 130,576   |   |   |              |   | 192,408 |   |
| Materials      and supplies                                                                                                       |   |                                     | 10,436    |   |   |              |   | 9,923 |   |
| Current      derivative assets (Note 8)                                                                                           |   |                                     | 86,274    |   |   |              |   | 52,177 |   |
| Current      income tax receivable                                                                                                |   |                                     | 4,246     |   |   |              |   | 11,768 |   |
| Prepaid      expenses and other                                                                                                   |   |                                     | 17,492    |   |   |              |   | 19,705 |   |
| Total      current assets                                                                                                         |   |                                     | 250,056   |   |   |              |   | 286,585 |   |
|                                                                                                                              |   |                                     |      |   |   |              |   |   |   |
| Property      and equipment:                                                                                                      |   |                                     |      |   |   |              |   |   |   |
| Drilling      equipment                                                                                                           |   |                                     | 1,182,730 |   |   |              |   | 1,172,655 |   |
| Oil      and natural gas properties, on the full cost method:                                                                     |   |                                     |      |   |   |              |   |   |   |
| Proved      properties                                                                                                            |   |                                     | 2,148,030 |   |   |              |   | 2,090,623 |   |
| Undeveloped      leasehold not being amortized                                                                                    |   |                                     | 167,057   |   |   |              |   | 160,034 |   |
| Gas      gathering and processing equipment                                                                                       |   |                                     | 172,799   |   |   |              |   | 169,402 |   |
| Transportation      equipment                                                                                                     |   |                                     | 32,975    |   |   |              |   | 33,611 |   |
| Other                                                                                                                             |   |                                     | 22,785    |   |   |              |   | 22,484 |   |
|                                                                                                                              |   |                                     | 3,726,376 |   |   |              |   | 3,648,809 |   |
| Less      accumulated depreciation, depletion, amortization                                                                       |   |                                     |      |   |   |              |   |   |   |
| and      impairment                                                                                                               |   |                                     | 1,776,875 |   |   |              |   | 1,447,157 |   |
| Net      property and equipment                                                                                                   |   |                                     | 1,949,501 |   |   |              |   | 2,201,652 |   |
|                                                                                                                              |   |                                     |      |   |   |              |   |   |   |
| Goodwill                                                                                                                          |   |                                     | 62,808    |   |   |              |   | 62,808 |   |
| Other      intangible assets, net                                                                                                 |   |                                     | 8,397     |   |   |              |   | 9,384 |   |
| Non-current      derivative assets (Note 8)                                                                                       |   |                                     | 22,249    |   |   |              |   | 5,218 |   |
| Other      assets                                                                                                                 |   |                                     | 15,862    |   |   |              |   | 16,219 |   |
| Total      assets                                                                                                                 |   | $                                        | 2,308,873 |   |   |              | $      | 2,581,866 |   |

|                                                     |   | March      31,                           |      |   |   | December      31, |   |
|----------------------------------------------------------|--------|------------------------------------------|-----------|--------|--------|-------------------|--------|
|                                                     |   | 2009                                     |      |   |   | 2008              |   |
|                                                     |   | (In      thousands except share amounts) |      |
| LIABILITIES      AND SHAREHOLDERS’ EQUITY          |   |                                     |      |   |   |              |   |   |   |
| Current      liabilities:                                |   |                                     |      |   |   |              |   |   |   |
| Accounts      payable                                    |   | $                                        | 74,898    |   |   |              | $      | 129,755 |   |
| Accrued      liabilities                                 |   |                                     | 55,801    |   |   |              |   | 51,659 |   |
| Contract      advances                                   |   |                                     | 2,562     |   |   |              |   | 2,889 |   |
| Current      portion of derivative liabilities (Note 8)  |   |                                     | 2,393     |   |   |              |   | 1,481 |   |
| Current      portion of other liabilities (Note 4)       |   |                                     | 11,401    |   |   |              |   | 10,615 |   |
|          Total current liabilities        |   |                                     | 147,055   |   |   |              |   | 196,399 |   |
|                                                     |   |                                     |      |   |   |              |   |   |   |
| Long-term      debt                                      |   |                                     | 163,500   |   |   |              |   | 199,500 |   |
| Long-term      derivative liabilities (Note 8)           |   |                                     | 1,910     |   |   |              |   | 1,780 |   |
| Other      long-term liabilities (Note 4)                |   |                                     | 73,861    |   |   |              |   | 74,027 |   |
| Deferred      income taxes                               |   |                                     | 393,630   |   |   |              |   | 477,061 |   |
|                                                     |   |                                     |      |   |   |              |   |   |   |
| Shareholders’      equity:                         |   |                                     |      |   |   |              |   |   |   |
| Preferred      stock, $1.00 par value, 5,000,000 shares  |   |                                     |      |   |   |              |   |   |   |
| authorized,      none issued                             |   |                                     | —   |   |   |              |   | — |   |
| Common      stock, $.20 par value, 175,000,000 shares    |   |                                     |      |   |   |              |   |   |   |
| authorized,      47,537,200 and 47,255,964 shares        |   |                                     |      |   |   |              |   |   |   |
| issued,      respectively                                |   |                                     | 9,369     |   |   |              |   | 9,325 |   |
| Capital      in excess of par value                      |   |                                     | 377,788   |   |   |              |   | 367,000 |   |
| Accumulated      other comprehensive income              |   |                                     | 65,763    |   |   |              |   | 33,284 |   |
| Retained      earnings                                   |   |                                     | 1,075,997 |   |   |              |   | 1,223,490 |   |
|          Total shareholders’ equity |   |                                     | 1,528,917 |   |   |              |   | 1,633,099 |   |
| Total      liabilities and shareholders’ equity    |   | $                                        | 2,308,873 |   |   |              | $      | 2,581,866 |   |

|                                                       | Three      Months Ended |                                         |
|------------------------------------------------------------|-------------------------|----------------------------------------------|
|                                                       | March      31,          |                                         |
|                                                       | 2009                    |                                         | 2008 |   |
|                                                       |                    | (In      thousands except per share amounts) |
| Revenues:                                                  |                    |                                         |   |   |   |   |
| Contract      drilling                                     | $                       | 88,699                                       |   | $ | 147,247 |   |
| Oil      and natural gas                                   |                    | 88,904                                       |   |   | 130,002 |   |
| Gas      gathering and processing                          |                    | 22,143                                       |   |   | 44,223 |   |
| Other      income (expense), net                           |                    | 1,316                                        |   |   | (110 | ) |
| Total      revenues                                        |                    | 201,062                                      |   |   | 321,362 |   |
|                                                       |                    |                                         |   |   |   |   |
| Expenses:                                                  |                    |                                         |   |   |   |   |
| Contract      drilling:                                    |                    |                                         |   |   |   |   |
| Operating      costs                                       |                    | 50,330                                       |   |   | 74,461 |   |
| Depreciation                                               |                    | 12,619                                       |   |   | 15,364 |   |
| Oil      and natural gas:                                  |                    |                                         |   |   |   |   |
| Operating      costs                                       |                    | 24,816                                       |   |   | 27,601 |   |
| Depreciation,      depletion and amortization              |                    | 38,006                                       |   |   | 35,715 |   |
| Impairment      of oil and natural gas properties (Note 2) |                    | 281,241                                      |   |   | — |   |
| Gas      gathering and processing:                         |                    |                                         |   |   |   |   |
| Operating      costs                                       |                    | 20,677                                       |   |   | 35,072 |   |
| Depreciation      and amortization                         |                    | 4,061                                        |   |   | 3,481 |   |
| General      and administrative                            |                    | 6,089                                        |   |   | 6,525 |   |
| Interest,      net                                         |                    | 477                                          |   |   | 820 |   |
| Total      operating expenses                              |                    | 438,316                                      |   |   | 199,039 |   |
| Income      (loss) before income taxes                     |                    | (237,254                                     | ) |   | 122,323 |   |
|                                                       |                    |                                         |   |   |   |   |
| Income      tax expense (benefit):                         |                    |                                         |   |   |   |   |
| Current                                                    |                    | —                                      |   |   | 15,447 |   |
| Deferred                                                   |                    | (89,761                                      | ) |   | 29,812 |   |
| Total      income taxes                                    |                    | (89,761                                      | ) |   | 45,259 |   |
|                                                       |                    |                                         |   |   |   |   |
| Net      income (loss)                                     | $                       | (147,493                                     | ) | $ | 77,064 |   |
|                                                       |                    |                                         |   |   |   |   |
| Net      income (loss) per common share:                   |                    |                                         |   |   |   |   |
| Basic                                                      | $                       | (3.14                                        | ) | $ | 1.66 |   |
|                                                       |                    |                                         |   |   |   |   |
| Diluted                                                    | $                       | (3.14                                        | ) | $ | 1.65 |   |

|                                                       |   | Three      Months Ended |     |
|------------------------------------------------------------|--------|-------------------------|----------|
|                                                       |   | March      31,          |     |
|                                                       |   | 2009                    |     |   |   | 2008 |   |
|                                                       |   | (In      thousands)     |     |
| OPERATING      ACTIVITIES:                                 |   |                    |     |   |   |   |   |   |   |
| Net      income (loss)                                     |   | $                       | (147,493 | ) |   |   | $ | 77,064 |   |
| Adjustments      to reconcile net income to net cash       |   |                    |     |   |   |   |   |   |   |
| provided      by operating activities:                     |   |                    |     |   |   |   |   |   |   |
| Depreciation,      depletion and amortization              |   |                    | 54,958   |   |   |   |   | 54,734 |   |
| Impairment      of oil and natural gas properties (Note 2) |   |                    | 281,241  |   |   |   |   | — |   |
| Unrealized      loss on derivatives                        |   |                    | 1,968    |   |   |   |   | — |   |
| Deferred      tax expense (benefit)                        |   |                    | (89,761  | ) |   |   |   | 29,812 |   |
| Other                                                      |   |                    | 2,469    |   |   |   |   | 4,108 |   |
| Changes      in operating assets and liabilities           |   |                    |     |   |   |   |   |   |   |
| increasing      (decreasing) cash:                         |   |                    |     |   |   |   |   |   |   |
| Accounts      receivable                                   |   |                    | 61,832   |   |   |   |   | (15,650 | ) |
| Accounts      payable                                      |   |                    | 1,204    |   |   |   |   | 2,119 |   |
| Material      and supplies inventory                       |   |                    | (513     | ) |   |   |   | (292 | ) |
| Accrued      liabilities                                   |   |                    | (2,423   | ) |   |   |   | 8,729 |   |
| Contract      advances                                     |   |                    | (327     | ) |   |   |   | (2,853 | ) |
| Other      – net                                     |   |                    | 9,735    |   |   |   |   | 1,019 |   |
| Net      cash provided by operating activities             |   |                    | 172,890  |   |   |   |   | 158,790 |   |
|                                                       |   |                    |     |   |   |   |   |   |   |
| INVESTING      ACTIVITIES:                                 |   |                    |     |   |   |   |   |   |   |
| Capital      expenditures                                  |   |                    | (115,904 | ) |   |   |   | (159,504 | ) |
| Proceeds      from disposition of assets                   |   |                    | 3,870    |   |   |   |   | 736 |   |
| Net      cash used in investing activities                 |   |                    | (112,034 | ) |   |   |   | (158,768 | ) |
|                                                       |   |                    |     |   |   |   |   |   |   |
| FINANCING      ACTIVITIES:                                 |   |                    |     |   |   |   |   |   |   |
| Borrowings      under line of credit                       |   |                    | 50,800   |   |   |   |   | 56,500 |   |
| Payments      under line of credit                         |   |                    | (86,800  | ) |   |   |   | (60,500 | ) |
| Proceeds      from exercise of stock options               |   |                    | 17       |   |   |   |   | 323 |   |
| Book      overdrafts                                       |   |                    | (24,445  | ) |   |   |   | 3,427 |   |
| Net      cash used in financing activities                 |   |                    | (60,428  | ) |   |   |   | (250 | ) |
|                                                       |   |                    |     |   |   |   |   |   |   |
| Net      increase (decrease) in cash and cash equivalents  |   |                    | 428      |   |   |   |   | (228 | ) |
|                                                       |   |                    |     |   |   |   |   |   |   |
| Cash      and cash equivalents, beginning of period        |   |                    | 584      |   |   |   |   | 1,076 |   |
| Cash      and cash equivalents, end of period              |   | $                       | 1,012    |   |   |   | $ | 848 |   |

|                                                                      |   | Three      Months Ended |     |
|---------------------------------------------------------------------------|--------|-------------------------|----------|
|                                                                      |   | March      31,          |     |
|                                                                      |   | 2009                    |     | 2008 |   |
|                                                                      |   | (In      thousands)     |     |
| Net      income (loss)                                                    |   | $                       | (147,493 | ) | $ | 77,064 |   |
| Other      comprehensive income (loss), net of taxes:                     |   |                    |     |   |   |   |   |
|          Change in value of derivative instruments used as |   |                    |     |   |   |   |   |
| cash      flow hedges, net of tax of $29,406 and ($13,294)                |   |                    | 49,005   |   |   | (22,664 | ) |
| Reclassification      - derivative settlements,                           |   |                    |     |   |   |   |   |
| net      of tax of ($9,847) and ($1)                                      |   |                    | (16,554  | ) |   | (1 | ) |
| Ineffective      portion of derivatives, net of tax of $16 and zero       |   |                    | 28       |   |   | — |   |
| Comprehensive      income (loss)                                          |   | $                       | (115,014 | ) | $ | 54,399 |   |

|                                                             |   | Income/(Loss)                                |     | Weighted      Shares |   | Per-Share |   |
|------------------------------------------------------------------|--------|----------------------------------------------|----------|----------------------|--------|-----------|--------|
|                                                             |   | (Numerator)                                  |     | (Denominator)        |   | Amount    |   |
|                                                             |   | (In      thousands except per share amounts) |     |
| For      the three months ended                                  |   |                                         |     |                 |   |      |   |   |   |   |
| March      31, 2009:                                             |   |                                         |     |                 |   |      |   |   |   |   |
| Basic      earnings (loss) per common share                      |   | $                                            | (147,493 | )                    |   | 46,921    |   |   | (3.14 | ) |
| Effect      of dilutive stock options, restricted                |   |                                         |     |                 |   |      |   |   |   |   |
| stock      and stock appreciation rights                         |   |                                         | —  |                 |   | —   |   |   | — |   |
| Diluted      earnings (loss) per common share                    |   | $                                            | (147,493 | )                    |   | 46,921    |   |   | (3.14 | ) |
|                                                             |   |                                         |     |                 |   |      |   |   |   |   |
| For      the three months ended                                  |   |                                         |     |                 |   |      |   |   |   |   |
| March      31, 2008:                                             |   |                                         |     |                 |   |      |   |   |   |   |
| Basic      earnings per common share                             |   | $                                            | 77,064   |                 |   | 46,481    |   | $ | 1.66 |   |
| Effect      of dilutive stock options, restricted                |   |                                         |     |                 |   |      |   |   |   |   |
|     stock      and stock appreciation rights |   |                                         | —  |                 |   | 319       |   |   | (0.01 | ) |
| Diluted      earnings per common share                           |   | $                                            | 77,064   |                 |   | 46,800    |   | $ | 1.65 |   |

|                        |   | March      31, |
|-----------------------------|--------|----------------|
|                        |   | 2009           |   |   |   | 2008 |
|                        |   |           |   |   |   |   |   |   |
| Options      and SARs       |   |           | 374,921 |   |   |   |   | 105,665 |
|                        |   |           |   |   |   |   |   |   |
| Average      Exercise Price |   | $              | 47.09 |   |   |   | $ | 56.33 |

|                                                         |   | March      31,      |    | December      31, |   |
|--------------------------------------------------------------|--------|---------------------|---------|-------------------|--------|
|                                                         |   | 2009                |    | 2008              |   |
|                                                         |   | (In      thousands) |    |
| Revolving      credit facility,                              |   |                |    |              |   |   |   |
|   with      interest of 3.0% at March 31, 2009 and |   |                |    |              |   |   |   |
|   3.2%      at December 31, 2008                   |   | $                   | 163,500 |              | $      | 199,500 |   |
| Less      current portion                                    |   |                | — |              |   | — |   |
| Total      long-term debt                                    |   | $                   | 163,500 |              | $      | 199,500 |   |
|                                                         |   |                |    |              |   |   |   |

| ·   | the      payment of dividends (other than stock dividends) during any fiscal year      in excess of 25% of our consolidated net income for the preceding fiscal      year; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      incurrence of additional debt with certain limited exceptions;      and |
|--------------------|----------------------------------------------------------------------------------|

| ·   | the      creation or existence of mortgages or liens, other than those in the      ordinary course of business, on any of our properties, except in favor of      our lenders. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | consolidated      net worth of at least $900 million; |
|--------------------|-------------------------------------------------------|

| ·   | a      current ratio (as defined in the Credit Facility) of not less than 1 to 1;      and                                                                                                            |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | a      leverage ratio of long-term debt to consolidated EBITDA (as defined in the      Credit Facility) for the most recently ended rolling four fiscal quarters      of no greater than 3.50 to 1.0. |

|                                   |   |                | March      31, |   |   | December      31, |   |
|----------------------------------------|--------|---------------------|----------------|--------|--------|-------------------|--------|
|                                   |   |                | 2009           |   |   | 2008              |   |
|                                   |   | (In      thousands) |
|                                   |   |                |           |   |   |              |   |
| Plugging      liability                |   | $                   | 50,598         |   | $      | 49,230            |   |
| Workers’      compensation       |   |                | 23,059         |   |   | 23,473            |   |
| Separation      benefit plans          |   |                | 6,157          |   |   | 6,435             |   |
| Gas      balancing liability           |   |                | 3,364          |   |   | 3,364             |   |
| Deferred      compensation plan        |   |                | 2,047          |   |   | 2,030             |   |
| Retirement      agreements             |   |                | 37             |   |   | 110               |   |
|                                   |   |                | 85,262         |   |   | 84,642            |   |
| Less      current portion              |   |                | 11,401         |   |   | 10,615            |   |
| Total      other long-term liabilities |   | $                   | 73,861         |   | $      | 74,027            |   |

|                                    |   | Three      Months EndedMarch      31, |   |
|-----------------------------------------|--------|---------------------------------------|--------|
|                                    |   | 2009                                  |   | 2008 |   |
|                                    |   | (In      thousands)                   |   |
|                                    |   |                                  |   |   |   |   |   |
| Plugging      liability, January 1:     |   | $                                     | 49,230 |   | $ | 33,191 |   |
| Accretion      of discount              |   |                                  | 632    |   |   | 422 |   |
| Liability      incurred                 |   |                                  | 898    |   |   | 588 |   |
| Liability      settled                  |   |                                  | (202   | ) |   | (163 | ) |
| Revision      of estimates              |   |                                  | 40     |   |   | 47 |   |
| Plugging      liability, March 31:      |   |                                  | 50,598 |   |   | 34,085 |   |
| Less      current portion               |   |                                  | 1,135  |   |   | 710 |   |
| Total      long-term plugging liability |   | $                                     | 49,463 |   | $ | 33,375 |   |

Modernization of Oil and GasReporting.  On December 31, 2008, the Securities and ExchangeCommission (SEC) adopted major revisions to its rules governing oil and gascompany reporting requirements. These include provisions that permit the use ofnew technologies to determine proved reserves, and that allow companies todisclose their probable and possible reserves to investors. The current ruleslimit disclosure to only proved reserves. The new disclosure requirements alsorequire companies to report the independence and qualifications of the auditorof the reserve estimates and file reports when a third party is relied upon toprepare reserves estimates. The new rules also require that oil and gas reservesbe reported and the full cost ceiling value calculated using an average pricebased upon the first-of-month posted price for each month in the priortwelve-month period. The new oil and gas reporting requirements are effectivefor annual reports on Form 10-K for fiscal years ending on or after December 31,2009, with early adoption not permitted.  We are currently evaluating theimpact the new rules may have on our consolidated financialstatements.

|                                    |   | Three      Months Ended |    |
|-----------------------------------------|--------|-------------------------|---------|
|                                    |   | March      31,          |    |
|                                    |   | 2009                    |    | 2008 |   |
|                                    |   |                    |    |   |   |   |   |
| Shares      granted                     |   |                    | — |   |   | 14,500 |   |
|                                    |   |                    |    |   |   |   |   |
| Estimated      fair value (in millions) |   | $                       | — |   | $ | 0.6 |   |
|                                    |   |                    |    |   |   |   |   |
| Percentage      of shares granted       |   |                    |    |   |   |   |   |
| expected      to be distributed         |   |                    | — | % |   | 89 | % |
|                                    |   |                    |    |   |   |   |   |

| Term                                |   | Amount                                    |   | Fixed      Rate |   | Floating      Rate |
|-------------------------------------|--------|-------------------------------------------|--------|-----------------|--------|--------------------|
| December      2007 – May 2012 |   | $     15,000,000 |   | 4.53%           |   | 3      month LIBOR |
| December      2007 – May 2012 |   | $     15,000,000 |   | 4.16%           |   | 3      month LIBOR |

| ·   | Swaps.  We      receive or pay a fixed price for the hedged commodity and pay or receive a      floating market price to the counterparty.  The fixed-price      payment and the floating-price payment are netted, resulting in a net      amount due to or from thecounterparty. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Collars.  A      collar contains a fixed floor price (put) and a ceiling price      (call).  If the market price exceeds the call strike price or      falls below the put strike price, we receive the fixed price and pay the      market price.  If the market price is between the call and the      put strike price, no payments are due from either  party. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Basis Swaps. We receive      or pay the NYMEX settlement value plus or minus a fixed delivery point      price for the hedged commodity and pay or receive the published index      price at the specified delivery point. We use basis swaps to hedge the      price risk between NYMEX and its physical delivery  points. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Term                                   |   | Commodity                                        |   | Hedged      Volume    |   | Weighted      Average Fixed Price for Swaps |   | Hedged      Market          |
|----------------------------------------|--------|--------------------------------------------------|--------|-----------------------|--------|---------------------------------------------|--------|-----------------------------|
| Apr’09      – Dec’09 |   | Crude      oil - collar                          |   | 500      Bbl/day      |   | $100.00      put & $156.25 call         |   | WTI      – NYMEX      |
| Apr’09      – Dec’09 |   | Crude      oil – swap                      |   | 2,000      Bbl/day    |   | $51.87                                      |   | WTI      – NYMEX      |
| Apr’09      – Dec’09 |   | Natural      gas - collar                        |   | 10,000      MMBtu/day |   | $      8.22 put & $10.80 call           |   | IF –      NYMEX (HH)  |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      7.01                                 |   | IF –      Tenn Zone 0 |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      6.32                                 |   | IF –      CEGT        |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 25,000      MMBtu/day |   | $      5.57                                 |   | IF –      PEPL        |
|                                   |   |                                             |   |                  |   |                                        |   |                        |
| Jan’10      – Dec’10 |   | Crude      oil – swap                      |   | 1,000      Bbl/day    |   | $59.81                                      |   | WTI      – NYMEX      |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 15,000      MMBtu/day |   | $      7.20                                 |   | IF –      NYMEX (HH)  |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 20,000      MMBtu/day |   | $      6.89                                 |   | IF –      Tenn Zone 0 |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      6.12                                 |   | IF –      CEGT        |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 20,000      MMBtu/day |   | $      5.67                                 |   | IF –      PEPL        |
| Jan’10      – Dec’10 |   | Natural      gas – basis differential swap |   | 10,000      MMBtu/day |   | ($0.79)                                     |   | PEPL      – NYMEX     |

| Term                                   |   | Commodity                                        |   | Hedged      Volume    |   | Basis      Differential |   | Hedged      Market      |
|----------------------------------------|--------|--------------------------------------------------|--------|-----------------------|--------|-------------------------|--------|-------------------------|
| Apr’09      – Dec’09 |   | Natural      gas – basis differential swap |   | 10,000      MMBtu/day |   | ($1.02)                 |   | PEPL      – NYMEX |
| Apr’09      – Dec’09 |   | Natural      gas – basis differential swap |   | 10,000      MMBtu/day |   | ($1.10)                 |   | CEGT      – NYMEX |

| Term                                   |   | Commodity                   |   | Hedged      Volume |   | Weighted      Average Fixed Price for Swaps |   | Hedged      Market     |
|----------------------------------------|--------|-----------------------------|--------|--------------------|--------|---------------------------------------------|--------|------------------------|
| Jan’10      – Dec’10 |   | Crude      oil – swap |   | 500      Bbl/day   |   | $64.45                                      |   | WTI      – NYMEX |

|                                                         |   |                               |    | Derivative      Assets |
|--------------------------------------------------------------|--------|------------------------------------|---------|------------------------|
|                                                         |   |                               |    | Fair      Value        |
|                                                         |   |                               |    | March      31,         |   | December      31, |
|                                                         |   | Balance      Sheet Location        |    | 2009                   |   | 2008 |
| Derivatives      designated as hedging instruments           |   | (In      thousands)                |
|                                                         |   |                               |    |                   |   |   |   |   |
| Commodity      derivatives:                                  |   |                               |    |                   |   |   |   |   |
| Current                                                      |   | Current      derivative assets     |    | $                      | 86,274 |   | $ | 51,130 |
| Long-term                                                    |   | Non-current      derivative assets |    |                   | 22,249 |   |   | 5,218 |
| Total      derivatives designated as hedging instruments     |   |                               | 108,523 |                   |   | 56,348 |
|                                                         |   |                               |    |                   |   |   |
|                                                         |   |                               |    |                   |   |   |
| Derivatives      not designated as hedging instruments       |   |                               |    |                   |   |   |
|                                                         |   |                               |    |                   |   |   |
| Commodity      derivatives:                                  |   |                               |    |                   |   |   |   |   |
| Current                                                      |   | Current      derivative assets     |    |                   | — |   |   | 1,047 |
| Total      derivatives not designated as hedging instruments |   |                               | — |                   |   | 1,047 |
|                                                         |   |                               |    |                   |   |   |
| Total      derivative assets                                 |   | $                                  | 108,523 |                   | $ | 57,395 |

|                                                         |   |                                           |   | Derivative      Liabilities |
|--------------------------------------------------------------|--------|------------------------------------------------|--------|-----------------------------|
|                                                         |   |                                           |   | Fair      Value             |
|                                                         |   |                                           |   | March      31,              |   | December      31, |
|                                                         |   | Balance      Sheet Location                    |   | 2009                        |   | 2008 |
| Derivatives      designated as hedging instruments           |   | (In      thousands)                            |
|                                                         |   |                                           |   |                        |   |   |   |   |
| Interest      rate swaps:                                    |   |                                           |   |                        |   |   |   |   |
| Current                                                      |   | Current      portion of derivative liabilities |   | $                           | 804 |   | $ | 736 |
| Long-term                                                    |   | Other      long-term derivative liabilities    |   |                        | 1,675 |   |   | 1,780 |
| Commodity      derivatives:                                  |   |                                           |   |                        |   |   |   |   |
| Current                                                      |   | Current      portion of derivative liabilities |   |                        | 713 |   |   | 745 |
| Long-term                                                    |   | Other      long-term derivative liabilities    |   |                        | 235 |   |   | — |
| Total      derivatives designated as hedging instruments     |   |                                           | 3,427  |                        |   | 3,261 |
|                                                         |   |                                           |   |                        |   |   |   |   |
|                                                         |   |                                           |   |                        |   |   |   |   |
| Derivatives      not designated as hedging instruments       |   |                                           |   |                        |   |   |
|                                                         |   |                                           |   |                        |   |   |   |   |
| Commodity      derivatives (basis swaps):                    |   |                                           |   |                        |   |   |   |   |
| Current                                                      |   | Current      portion of derivative liabilities |   |                        | 876 |   |   | — |
| Total      derivatives not designated as hedging instruments |   |                                           | 876    |                        |   | — |
|                                                         |   |                                           |   |                        |   |   |   |   |
| Total      derivative liabilities                            |   |                                           |   | $                           | 4,303 |   | $ | 3,261 |

| Derivatives      in Cash Flow Hedging Relationships |   |        Amount      of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)      (1) |                |
|-----------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|---------------------|
|                                                |   | 2009                                                                                                   |                |   | 2008 |   |
|                                                |   |                                                                                                   | (In      thousands) |   |
| Interest      rate swaps                            |   | $                                                                                                      | (1,555              | ) |   | $ | (954 | ) |
| Commodity      derivatives                          |   |                                                                                                   | 67,318              |   |   |   | (20,553 | ) |
| Total                                               |   | $                                                                                                      | 65,763              |   |   | $ | (21,507 | ) |

| Derivative      Instrument | Location      of Gain or (Loss) Reclassified from Accumulated OCI into Income &      Location of Gain or (Loss) Recognized in Income |   | Amount of Gain or      (Loss) Reclassified from Accumulated OCI into Income (1) |    | Amount of Gain or      (Loss) Recognized in Income  (2) |   |
|----------------------------|------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------|---------|-------------------------------------------------------------------|--------|
|                       |                                                                                                                                     |   | 2009                                                                            |    | 2008                                                              |   |   | 2009 |   |   | 2008 |   |
|                       |                                                                                                                                     |   | (In      thousands)                                                             |    |
| Commodity      derivatives | Oil      and natural gas revenue                                                                                                         |   | $                                                                               | 26,589  |                                                              | $      | (112 | )  | $ | (44 | )  | $ | — |   |
| Commodity      derivatives | Gas      gathering and processing revenue                                                                                                |   |                                                                            | — |                                                              |   | (119 | )  |   | — |   |   | — |   |
| Commodity      derivatives | Gas      gathering and processing operating costs                                                                                        |   |                                                                            | — |                                                              |   | 182 |   |   | — |   |   | — |   |
| Interest      rate swaps   | Interest,      net                                                                                                                       |   |                                                                            | (188    | )                                                                 |   | 51 |   |   | — |   |   | — |   |
|                       | Total                                                                                                                                    |   | $                                                                               | 26,401  |                                                              | $      | 2 |   | $ | (44 | ) | $ | — |   |

----

| Derivatives      Not Designated as Hedging Instruments |   | Location      of Gain or (Loss) Recognized in Income on Derivative |   | Amount      of Gain or (Loss) Recognized in Income on Derivative |   |
|--------------------------------------------------------|--------|--------------------------------------------------------------------|--------|------------------------------------------------------------------|--------|
|                                                   |   |                                                               |   | 2009                                                             |   | 2008 |   |
|                                                   |   |                                                               |   | (In      thousands)                                              |   |
|                                                   |   |                                                               |   |                                                             |   |   |   |   |   |
| Commodity      derivatives (basis swaps)               |   | Oil      and natural gas revenue                                   |   | $                                                                | (1,108 | ) | $ | — |   |
| Total                                                  |   |                                                               |   | $                                                                | (1,108 | ) | $ | — |   |

| ·   | Level      1 - unadjusted quoted prices in active markets for identical assets and      liabilities. |
|--------------------|------------------------------------------------------------------------------------------------------|

| ·   | Level      2 - significant observable pricing inputs other than quoted prices      included within level 1 that are either directly or indirectly observable      as of the reporting date.  Essentially, inputs (variables used      in the pricing models) that are derived principally from or corroborated      by observable market data. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      3 - generally unobservable inputs which are developed based on the best      information available and may include our own internal    data. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                 |    March 31, 2009 |   |
|--------------------------------------|----------------------------------|--------|
|                                 |                             |   | Level      1 |   |   | Level      2 |   |   | Level      3 |   |   | Total |   |
|                                 | (In      thousands)              |
| Financial      assets (liabilities): |                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      rate swaps             |                             | $      | — |   | $ | — |   | $ | (2,479 | ) | $ | (2,479 | ) |
| Commodity      derivatives           |                             | $      | — |   | $ | (2,714 | ) | $ | 109,413 |   | $ | 106,699 |   |

|                                                          |   | Net      Derivatives                               |
|---------------------------------------------------------------|--------|----------------------------------------------------|
|                                                          |   | For      the Three Months EndedMarch      31, 2009 |
|                                                          |   | Interest      Rate Swaps                           |   |   | Commodity      Swaps and Collars |   |
|                                                          |   | (In      thousands)                                |
| Beginning      of period                                      |   | $                                                  | (2,516 | ) |   | $ | 58,508 |   |
| Total      gains or losses (realized and unrealized):         |   |                                               |   |   |   |   |   |   |
| Included      in earnings (1)                                 |   |                                               | (188 | ) |   |   | 23,878 |   |
| Included      in other comprehensive income (loss)            |   |                                               | 37 |   |   |   | 52,873 |   |
| Purchases,      issuance and settlements                      |   |                                               | 188 |   |   |   | (25,846 | ) |
| End      of period                                            |   | $                                                  | (2,479 | ) |   | $ | 109,413 |   |
|                                                          |   |                                               |   |   |   |   |   |   |
| Total      gains (losses) for the period included in earnings |   |                                               |   |   |   |   |   |   |
| attributable      to the change in unrealized gain (loss)     |   |                                               |   |   |   |   |   |   |
| relating      to assets still held as of March 31, 2009       |   | $                                                  | — |   |   | $ | (1,968 | ) |

|        (1)  |  Interest      rate swaps and commodity sales swaps and collars are reported in the      condensed consolidated statements of  operations in interest, net and      revenues, respectively. |
|-----------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                      |   | Three      Months Ended |     |
|-------------------------------------------|--------|-------------------------|----------|
|                                      |   | March      31,          |     |
|                                      |   | 2009                    |     | 2008 |   |
|                                      |   | (In      thousands)     |     |
| Revenues:                                 |   |                    |     |   |   |   |   |
| Contract      drilling                    |   | $                       | 91,324   |   | $ | 163,914 |   |
| Elimination      of inter-segment revenue |   |                    | 2,625    |   |   | 16,667 |   |
| Contract      drilling net of             |   |                    |     |   |   |   |   |
| inter-segment      revenue                |   |                    | 88,699   |   |   | 147,247 |   |
|                                      |   |                    |     |   |   |   |   |
| Oil      and natural gas                  |   |                    | 88,904   |   |   | 130,002 |   |
|                                      |   |                    |     |   |   |   |   |
| Gas      gathering and processing         |   |                    | 30,656   |   |   | 56,559 |   |
| Elimination      of inter-segment revenue |   |                    | 8,513    |   |   | 12,336 |   |
| Gas      gathering and processing         |   |                    |     |   |   |   |   |
| net      of inter-segment revenue         |   |                    | 22,143   |   |   | 44,223 |   |
|                                      |   |                    |     |   |   |   |   |
| Other                                     |   |                    | 1,316    |   |   | (110 | ) |
| Total      revenues                       |   | $                       | 201,062  |   | $ | 321,362 |   |
|                                      |   |                    |     |   |   |   |   |
| Operating      income (loss) (1):         |   |                    |     |   |   |   |   |
| Contract      drilling                    |   | $                       | 25,750   |   | $ | 57,422 |   |
| Oil      and natural gas (2)              |   |                    | (255,159 | ) |   | 66,686 |   |
| Gas      gathering and processing         |   |                    | (2,595   | ) |   | 5,670 |   |
| Total      operating income (loss)        |   |                    | (232,004 | ) |   | 129,778 |   |
| General      and administrative expense   |   |                    | (6,089   | ) |   | (6,525 | ) |
| Interest      expense, net                |   |                    | (477     | ) |   |  (820 | ) |
| Other      income - net                   |   |                    | 1,316    |   |   | (110 | ) |
| Income      (loss) before income taxes    |   | $                       | (237,254 | ) | $ | 122,323 |   |

| (1)   | Operating      income (loss) is total operating revenues less operating expenses,      depreciation, depletion, amortization and impairment and does not include      non-operating revenues, general corporate expenses, interest expense or      income taxes. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)        | In      March 2009, we had an impairment of oil and natural gas properties of      $281.2 million pre-tax ($175.1 million net of tax) due to low commodity      prices at the end of the first quarter2009.                                                 |

| •  General                                |
|-----------------------------------------------------------|
| •  Business      Outlook                  |
| •  Executive      Summary                 |
| •  Financial      Condition and Liquidity |
| •  New      Accounting Pronouncements     |
| •  Results      of Operations             |

| •  Contract Drilling –      carried out by our subsidiary Unit Drilling Company and its subsidiaries.      This segment contracts to drill onshore oil and natural gas wells for      others and for our own account.                                                  |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  Oil and Natural Gas –      carried out by our subsidiary Unit Petroleum Company. This segment      explores, develops, acquires and produces oil and natural gas properties      for our own account.                                                               |
| •  Gas Gathering and Processing      (Mid-Stream) – carried out by      our subsidiary Superior Pipeline Company, L.L.C. and its subsidiaries.      This segment buys, sells, gathers, processes and treats natural gas for      third parties and for our ownaccount. |

| Date                   |   |          Gas Spot Price Henry Hub($      per MMBtu) |   | Crude      Oil WTI-Cushing, OK($      per Bbl) |
|------------------------|--------|--------------------------------------------------------------------|--------|------------------------------------------------|
| July      1, 2008      |   | $                                                                  | 13.19  |                                           | $ | 140.99 |
| August      1, 2008    |   | $                                                                  | 9.26   |                                           | $ | 125.10 |
| September      1, 2008 |   | $                                                                  | 8.24   |                                           | $ | 115.48 |
| October      1, 2008   |   | $                                                                  | 7.17   |                                           | $ | 98.55 |
| November      1, 2008  |   | $                                                                  | 6.20   |                                           | $ | 67.81 |
| December      1, 2008  |   | $                                                                  | 6.44   |                                           | $ | 49.28 |
| January      1, 2009   |   | $                                                                  | 5.63   |                                           | $ | 44.61 |
| February      1, 2009  |   | $                                                                  | 4.77   |                                           | $ | 41.70 |
| March      1, 2009     |   | $                                                                  | 4.04   |                                           | $ | 44.76 |
| April      1, 2009     |   | $                                                                  | 3.58   |                                           | $ | 48.39 |
| May      1, 2009       |   | $                                                                  | 3.25   |                                           | $ | 53.20 |

| Period              |   | Average      Rigs in Use |   | Average      Dayrates |   |
|---------------------|--------|--------------------------|--------|-----------------------|--------|
| July      2008      |   | 108.8                    |   |                  | $      | 18,276 |   |
| August      2008    |   | 111.2                    |   |                  | $      | 18,624 |   |
| September      2008 |   | 112.1                    |   |                  | $      | 19,044 |   |
| October      2008   |   | 111.5                    |   |                  | $      | 19,229 |   |
| November      2008  |   | 97.8                     |   |                  | $      | 19,426 |   |
| December      2008  |   | 81.0                     |   |                  | $      | 19,352 |   |
| January      2009   |   | 63.8                     |   |                  | $      | 18,993 |   |
| February      2009  |   | 52.2                     |   |                  | $      | 18,414 |   |
| March      2009     |   | 42.2                     |   |                  | $      | 18,356 | (1) |

| (1)   | These      average dayrates in March 2009 include 18 term contracts, of which four      will roll off and one is up for renewal during the second quarter of 2009,      two are up for renewal during the third quarter of 2009, six are up for      renewal during the fourth quarter of 2009 and the remaining five are up      for renewal beyond 2009. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In      March 2009, we incurred a non-cash ceiling test write down of our oil and      natural gas properties of $281.2 million pre-tax ($175.1 million net of      tax) as a result of a decline in commodity prices as compared to those      existing at year end 2008. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | As      a result of lower commodity prices combined with service costs that remain      relatively high, we have reduced the number of gross wells we plan to      drill in 2009 by approximately 50% from the number of gross wells drilled      in 2008. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In      late 2008, as a result of the significant decline in commodity prices and      the resulting drop in demand for our drilling rigs, we stored a 1,500      horsepower diesel electric drilling rig that was scheduled to be placed      into service in North Dakota during the first quarter of 2009. The      mobilization has been delayed pending final negotiation with our customer.      In addition, after discussions with our customers, we postponed the      construction of eight additional drilling rigs we had previously      anticipated building and instead substituted drilling rigs we already      owned.  As a result of existing contractual obligations, we      expect to take delivery of a new drilling rig during the fourth quarter of      2009. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Due      to declining commodity prices of oil and natural gas, several of our      drilling rig customers have significantly reduced their drilling budgets      for 2009, resulting in a significant reduction in the average utilization      of our drilling rig fleet.  Our average utilization rate was 81%      for the nine months ended September 30, 2008, 61% for the month of      December 2008 and 32% for the month of March 2009. We currently expect      this rate to continue to be depressed throughout  2009. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      have reduced our total 2009 estimated capital expenditures for all three      of our business segments by approximately 60% compared to 2008, excluding      acquisitions, in order to focus keeping our capital expenditures within      anticipated internally generated cash flow. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Reduced      prices for ethane resulted in curtailment of certain liquids production      early in the first quarter of 2009. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------|

| •  the      demand for and the dayrates we receive for our drilling      rigs;                                                                            |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| •  the      quantity of natural gas, oil and NGLs we produce;                                                                                             |
| •  the      prices we receive for our natural gas production and, to a lesser extent,      the prices we receive for our oil and NGL production;      and |
| •  the      margins we obtain from our natural gas gathering and processing      contracts.                                                               |

|                                                          |   | March      31,                         |      |    | %      |      |
|---------------------------------------------------------------|--------|----------------------------------------|-----------|---------|--------|-----------|
|                                                          |   |                                   | 2009      |    |   | 2008      |   |   | Change |  (2) |
|                                                          |   | (In      thousands except percentages) |      |
| Working      capital                                          |   | $                                      | 103,001   |    | $      | 36,095    |   |   | 185 | % |
| Long-term      debt                                           |   | $                                      | 163,500   |    | $      | 116,600   |   |   | 40 | % |
| Shareholders’      equity (1)                      |   | $                                      | 1,528,917 |    | $      | 1,496,981 |   |   | 2 | % |
| Ratio      of long-term debt to total capitalization (1) |   |                                   | 10        | %       |   | 7         | % |   | 43 | % |
| Net      income (loss) (1)                                    |   | $                                      | (147,493  | )  | $      | 77,064    |   |   | NM | % |
| Net      cash provided by operating activities                |   | $                                      | 172,890   |    | $      | 158,790   |   |   | 9 | % |
| Net      cash used in investing activities                    |   | $                                      | (112,034  | )       | $      | (158,768  | ) |   | (29 | )% |
| Net      cash used in financing activities               |   | $                                      | (60,428   | )       | $      | (250      | )  |   | NM | % |

| (1)   | In      March 2009, we incurred a non-cash ceiling test write down of our oil and      natural gas properties of $281.2 million pre-tax ($175.1 million net of      tax) due to low commodity prices at quarter-end. The write down impacted      our 2009 shareholders’ equity, ratio of long-term debt to total      capitalization and net income.  There was no impact on our      compliance with the covenants contained in our Credit      Facility. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | NM      – A percentage calculation is not meaningful due to a zero-value      denominator or a percentage change greater than  200. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------|

|                                                             |   | Three      Months Ended March 31, |    |   | %      |    |
|------------------------------------------------------------------|--------|-----------------------------------|---------|--------|--------|---------|
|                                                             |   |                              | 2009    |   |   | 2008    |   |   | Change |   |
| Contract      Drilling:                                          |   |                              |    |   |   |    |   |   |   |   |
| Average      number of our drilling rigs in use during           |   |                              |    |   |   |    |   |   |   |   |
| the      period                                                  |   |                              | 52.8    |   |   | 100.6   |   |   | (48 | )% |
| Total      number of drilling rigs owned at the end              |   |                              |    |   |   |    |   |   |   |   |
| of      the period                                               |   |                              | 131     |   |   | 129     |   |   | 2 | % |
| Average      dayrate                                             |   | $                                 | 18,638  |   | $      | 17,997  |   |   | 4 | % |
| Oil      and Natural Gas:                                        |   |                              |    |   |   |    |   |   |   |   |
| Oil      production (MBbls)                                      |   |                              | 343     |   |   | 292     |   |   | 17 | % |
| Natural      gas liquids production (MBbls)                      |   |                              | 393     |   |   | 306     |   |   | 28 | % |
| Natural      gas production (MMcf)                               |   |                              | 11,862  |   |   | 11,161  |   |   | 6 | % |
| Average      oil price per barrel received                       |   | $                                 | 50.51   |   | $      | 93.32   |   |   | (46 | )% |
| Average      oil price per barrel received excluding hedges      |   | $                                 | 38.52   |   | $      | 96.25   |   |   | (60 | )% |
| Average      NGL price per barrel received                       |   | $                                 | 18.69   |   | $      | 52.04   |   |   | (64 | )% |
| Average      NGL price per barrel received excluding hedges      |   | $                                 | 18.69   |   | $      | 51.49   |   |   | (64 | )% |
| Average      natural gas price per mcf received                  |   | $                                 | 5.44    |   | $      | 7.65    |   |   | (29 | )% |
| Average      natural gas price per mcf received excluding hedges |   | $                                 | 3.48    |   | $      | 7.60    |   |   | (54 | )% |
| Mid-Stream:                                                      |   |                              |    |   |   |    |   |   |   |   |
| Gas      gathered—MMBtu/day                                |   |                              | 192,320 |   |   | 200,697 |   |   | (4 | )% |
| Gas      processed—MMBtu/day                               |   |                              | 72,650  |   |   | 59,797  |   |   | 21 | % |
| Gas      liquids sold — gallons/day                        |   |                              | 218,762 |   |   | 183,924 |   |   | 19 | % |
| Number      of natural gas gathering systems                     |   |                              | 37      |   |   | 36      |   |   | 3 | % |
| Number      of processing plants                                 |   |                              | 9       |   |   | 8       |   |   | 13 | % |

| Lender                                   |   | Participation      Interest |
|------------------------------------------|--------|-----------------------------|
| Bank      of Oklahoma, N.A.              |   | 18.75%                      |
| Bank      of America, N.A.               |   | 18.75%                      |
| BMO      Capital Markets Financing, Inc. |   | 18.75%                      |
| Compass      Bank                        |   | 17.50%                      |
| Comerica      Bank                       |   | 08.75%                      |
| Fortis      Capital Corp.                |   | 08.75%                      |
| Calyon      New York Branch              |   | 08.75%                      |
|                                     |   | 100.00%                     |

|   |   |
|--------|--------|

| •  the      payment of dividends (other than stock dividends) during any fiscal year      in excess of 25% of our         |
|-------------------------------------------------------------------------------------------------------------------------------------------|
|         consolidated net income for the preceding fiscal    year;                                                               |
| •  the      incurrence of additional debt with certain very limited exceptions;      and                                  |
| •  the      creation or existence of mortgages or liens, other than those in the      ordinary course of business, on any |
|         of our properties, except in favor of our  lenders.                                                                     |

|   |   |
|--------|--------|

| •  a      consolidated net worth of at least $900.0million;                                                        |
|------------------------------------------------------------------------------------------------------------------------------------|
| •  a      current ratio (as defined in the Credit Facility) of not less than 1 to 1;      and                      |
| •  a      leverage ratio of long-term debt to consolidated EBITDA (as defined in the      Credit Facility) for the |
|         most recently ended rolling four fiscal quarters of no greater than 3.50      to 1.0.                            |

| Term                                |   | Amount                                    |   | Fixed      Rate |   | Floating      Rate |
|-------------------------------------|--------|-------------------------------------------|--------|-----------------|--------|--------------------|
|                                |   |                                      |   |            |   |               |
| December      2007 – May 2012 |   | $     15,000,000 |   | 4.53%           |   | 3      month LIBOR |
| December      2007 – May 2012 |   | $     15,000,000 |   | 4.16%           |   | 3      month LIBOR |

|                                     |   | Payments      Due by Period |        |
|------------------------------------------|--------|-----------------------------|-------------|
|                                     |   |                        |        |   |   | Less      Than |   |   | 2-3 |   |   | 4-5 |   |   | After |   |
|                                     |   |                        | Total  |   |   | 1      Year |   |   | Years |   |   | Years |   |   | 5      Years |   |
|                                     |   |                        |        |   |   |   |   | (In      thousands) |   |   |   |   |   |   |   |
| Bank      debt (1)                       |   | $                           | 180,227     |   | $ | 5,314 |   | $ | 10,627 |   | $ | 164,286 |   | $ | — |   |
| Retirement      agreements (2)           |   |                        | 37          |   |   | 37 |   |   | — |   |   | — |   |   | — |   |
| Operating      leases (3)                |   |                        | 2,331       |   |   | 1,746 |   |   | 585 |   |   | — |   |   | — |   |
| Drill      pipe, drilling components and |   |                        |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| equipment      purchases (4)             |   |                        | 51,396      |   |   | 36,580 |   |   | 14,816 |   |   | — |   |   | — |   |
| Total      contractual obligations       |   | $                           | 233,991     |   | $ | 43,677 |   | $ | 26,028 |   | $ | 164,286 |   | $ | — |   |

| (1) | See      previous discussion in MD&A regarding our Credit Facility. This      obligation is presented in accordance with the terms of the Credit      Facility and includes interest calculated using our March 31, 2009      interest rate of 3.2% which includes the effect of the interest rate      swaps. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | In      the second quarter of 2001, we recorded $1.3 million in additional      employee benefit expenses for the present value of a separation agreement      made in connection with the retirement of King Kirchner from his position      as chief executive officer. The liability associated with this expense,      including accrued interest, is paid in monthly payments which started in      July 2003 and continues through June2009. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | We      lease office space or yards in Tulsa, Oklahoma; Canadian and Houston,      Texas; Englewood and Denver, Colorado; Pinedale, Wyoming; and Pittsburgh,      Pennsylvania under the terms of operating leases expiring through January,      2012. Additionally, we have several equipment leases and lease space on      short-term commitments to stack excess drilling rig equipment and      production inventory. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | For      the next twelve months, we have committed to purchase approximately $36.6      million of new drilling rig components, drill pipe, drill collars and      related equipment. Beyond March 2010, we have committed to purchase      approximately $14.8 million of new drill pipe and drill      collars. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                    |   | Estimated Amount of Commitment      Expiration Per Period  |    |
|---------------------------------------------------------|--------|-----------------------------------------------------------------|---------|
|                                                    |   |                                                            |    |   |   | Less |   |   |   |   |   |   |   |   |   |   |
|                                                    |   |                                                            | Total   |   |   | Than      1 |   |   | 2-3 |   |   | 4-5 |   |   | After      5 |   |
| Other      Commitments                                  |   |                                                            | Accrued |   |   | Year |   |   | Years |   |   | Years |   |   | Years |   |
|                                                    |   |  (In      thousands)                                       |    |
| Deferred      compensation plan (1)                     |   | $                                                               | 2,047   |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |
| Separation      benefit plans (2)                       |   | $                                                               | 6,157   |   | $ | 1,304 |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |
| Derivative      liabilities – commodity hedges    |   | $                                                               | 1,824   |   | $ | 1,589 |   | $ | 235 |   | $ | — |   | $ | — |   |
| Derivative      liabilities – interest rate swaps |   | $                                                               | 2,479   |   | $ | 804 |   | $ | 1,608 |   | $ | 67 |   | $ | — |   |
| Plugging      liability (3)                             |   | $                                                               | 50,598  |   | $ | 1,135 |   | $ | 12,750 |   | $ | 3,183 |   | $ | 33,530 |   |
| Gas      balancing liability (4)                        |   | $                                                               | 3,364   |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |
| Repurchase      obligations (5)                         |   | $                                                               | — |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |   | Unknown |   |
| Workers’      compensation liability (6)          |   | $                                                               | 23,059  |   | $ | 8,924 |   | $ | 3,857 |   | $ | 1,234 |   | $ | 9,044 |   |

| (1) | We      provide a salary deferral plan which allows participants to defer the      recognition of salary for income tax purposes until actual distribution of      benefits, which occurs at either termination of employment, death or      certain defined unforeseeable emergency hardships. We recognize payroll      expense and record a liability, included in other long-term liabilities in      our Condensed Consolidated Balance Sheet, at the time of      deferral. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Effective      January 1, 1997, we adopted a separation benefit plan (“Separation Plan”).      The Separation Plan allows eligible employees whose employment with us is      involuntarily terminated or, in the case of an employee who has completed      20 years of service, voluntarily or involuntarily terminated, to receive      benefits equivalent to four weeks salary for every whole year of service      completed with the company up to a maximum of 104 weeks. To receive      payments the recipient must waive any claims against us in exchange for      receiving the separation benefits. On October 28, 1997, we adopted a      Separation Benefit Plan for Senior Management (“Senior Plan”). The Senior      Plan provides certain officers and key executives of the company with      benefits generally equivalent to the Separation Plan. The Compensation      Committee of the Board of Directors has absolute discretion in the      selection of the individuals covered in this plan. On May 5, 2004 we also      adopted the Special Separation Benefit Plan (“Special Plan”). This plan is      identical to the Separation Benefit Plan with the exception that the      benefits under the plan vest on the earliest of a participant’s reaching      the age of 65 or serving 20 years with the company. On December 31, 2008,      all these plans were amended to bring the plans into compliance with      Section 409A of the Internal Revenue Code of 1986, as      amended.  At March 31, 2009, there were 35 eligible employees to      participate in the Special Plan. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | When      a well is drilled or acquired, under Financial Accounting Standards No.      143 (FAS 143), “Accounting for Asset Retirement Obligations,” we have      recorded the fair value of liabilities associated with the retirement of      long-lived assets (mainly plugging and abandonment costs for our depleted      wells). |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | We      have recorded a liability for those properties we believe do not have      sufficient oil, NGLs and natural gas reserves to allow the under-produced      owners to recover their under-production from future production      volumes. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | We      formed The Unit 1984 Oil and Gas Limited Partnership and the 1986 Energy      Income Limited Partnership along with private limited partnerships (the      “Partnerships”) with certain qualified employees, officers and directors      from 1984 through 2008, with a subsidiary of ours serving as general      partner. The Partnerships were formed for the purpose of conducting oil      and natural gas acquisition, drilling and development operations and      serving as co-general partner with us in any additional limited      partnerships formed during that year. The Partnerships participated on a      proportionate basis with us in most drilling operations and most producing      property acquisitions commenced by us for our own account during the      period from the formation of the Partnership through December 31 of that      year. These partnership agreements require, on the election of a limited      partner, that we repurchase the limited partner’s interest at amounts to      be determined by appraisal in the future. Such repurchases in any one year      are limited to 20% of the units outstanding. We made repurchases of      $241,000 in 2008, and did not have any repurchases in 2009 or      2007. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (6)   | We      have recorded a liability for future estimated payments related to      workers’ compensation claims primarily associated with our contract      drilling segment. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Term                                |   | Amount                                |   | Fixed      Rate |   | Floating      Rate |   | Fair      Value Asset (Liability)                                                                        |
|-------------------------------------|--------|---------------------------------------|--------|-----------------|--------|--------------------|--------|----------------------------------------------------------------------------------------------------------|
| ($      in thousands)               |
| December      2007 – May 2012 |   | $     15,000 |   | 4.53%           |   | 3      month LIBOR |   | $                (1,326) |
| December      2007 – May 2012 |   | $     15,000 |   | 4.16%           |   | 3      month LIBOR |   | (1,153)                                                                                                  |
|                                |   |                                  |   |            |   |               |   | $                (2,479) |

|                              |   |   | April      – December 2009 |   | January      – December 2010 |
|-----------------------------------|--------|--------|----------------------------------|--------|------------------------------------|
| Daily      oil production         |   |   | 66                               | %      |                               | 39 | % |
| Daily      natural gas production |   |   | 70                               | %      |                               | 48 | % |

|                                                                                 |                | 2009    |   |   |   | 2008    |   |
|--------------------------------------------------------------------------------------|---------------------|---------|--------|--------|--------|---------|--------|
| Increases      (decreases) in:                                                       | (In      thousands) |    |
| Oil      and natural gas revenue:                                                    |                |    |   |   |   |    |   |
| Realized      gains (losses) on oil and natural gas derivatives                      | $                   | 27,405  |   |   | $      | (112    | )      |
| Unrealized      losses on ineffectiveness of cash flow hedges                        |                | (44     | )      |   |   | — |   |
| Unrealized      losses on non-qualifying oil and natural gas derivatives             |                | (1,924  | )      |   |   | — |   |
| Total      increase on oil and natural gas revenues due toderivatives                |                | 25,437  |   |   |   | (112    | )      |
| Gas      gathering and processing revenue (all realized gains    (losses))           |                | — |   |   |   | (119    | )      |
|                                                                                 |                |    |   |   |   |    |   |
| Gas      gathering and processing operating costs (all realized (gains)      losses) |                | — |   |   |   | (182    | )      |
|                                                                                 |                |    |   |   |   |    |   |
| Impact      on pre-tax earnings                                                      | $                   | 25,437  |   |   | $      | (49     | )      |

|                                                            |   |  Quarter      Ended March 31, |         |    | Percent |        |
|-----------------------------------------------------------------|--------|------------------------------------|--------------|---------|---------|-------------|
|                                                            |   |                               | 2009         |    |    | 2008        |   |   | Change |  (1) |
|                                                            |   |                               |         |    |    |        |   |   |   |   |
| Total      revenue                                              |   | $                                  | 201,062,000  |    | $       | 321,362,000 |   |   | (37 | )% |
| Net      income (loss)                                          |   | $                                  | (147,493,000 | )  | $       | 77,064,000  |   |   | NM | % |
| Contract      Drilling:                                         |   |                               |         |    |    |        |   |   |   |   |
| Revenue                                                         |   | $                                  | 88,699,000   |    | $       | 147,247,000 |   |   | (40 | )% |
| Operating      costs excluding depreciation                     |   | $                                  | 50,330,000   |    | $       | 74,461,000  |   |   | (32 | )% |
| Percentage      of revenue from daywork contracts               |   |                               | 100          | %       |    | 100         | % |   | — | % |
| Average      number of drilling rigs in use                     |   |                               | 52.8         |    |    | 100.6       |   |   | (48 | )% |
| Average      dayrate on daywork contracts                       |   | $                                  | 18,638       |    | $       | 17,997      |   |   | 4 | % |
| Depreciation                                                    |   | $                                  | 12,619,000   |    | $       | 15,364,000  |   |   | (18 | )% |
| Oil      and Natural Gas:                                       |   |                               |         |    |    |        |   |   |   |   |
| Revenue                                                         |   | $                                  | 88,904,000   |    | $       | 130,002,000 |   |   | (32 | )% |
| Operating      costs excluding depreciation, depletion,    |   |                               |         |    |    |        |   |   |   |   |
| amortization      and impairment                                |   | $                                  | 24,816,000   |    | $       | 27,601,000  |   |   | (10 | )% |
| Average      oil price (Bbl)                                    |   | $                                  | 50.51        |    | $       | 93.32       |   |   | (46 | )% |
| Average      NGL price (Bbl)                                    |   | $                                  | 18.69        |    | $       | 52.04       |   |   | (64 | )% |
| Average      natural gas price (Mcf)                            |   | $                                  | 5.44         |    | $       | 7.65        |   |   | (29 | )% |
| Oil      production (Bbl)                                       |   |                               | 343,000      |    |    | 292,000     |   |   | 17 | % |
| NGL      production (Bbl)                                       |   |                               | 393,000      |    |    | 306,000     |   |   | 28 | % |
| Natural      gas production (Mcf)                               |   |                               | 11,862,000   |    |    | 11,161,000  |   |   | 6 | % |
| Depreciation,      depletion and amortization                   |   |                               |         |    |    |        |   |   |   |   |
| rate      (Mcfe)                                                |   | $                                  | 2.32         |    | $       | 2.41        |   |   | (4 | )% |
| Depreciation,      depletion and amortization                   |   | $                                  | 38,006,000   |    | $       | 35,715,000  |   |   | 6 | % |
| Impairment      of oil and natural gas properties               |   | $                                  | 281,241,000  |    | $       | —     |   |   | NM | % |
| Mid-Stream      Operations:                                     |   |                               |         |    |    |        |   |   |   |   |
| Revenue                                                         |   | $                                  | 22,143,000   |    | $       | 44,223,000  |   |   | (50 | )% |
| Operating      costs excluding depreciation                     |   |                               |         |    |    |        |   |   |   |   |
| and      amortization                                           |   | $                                  | 20,677,000   |    | $       | 35,072,000  |   |   | (41 | )% |
| Depreciation      and amortization                              |   | $                                  | 4,061,000    |    | $       | 3,481,000   |   |   | 17 | % |
| Gas      gathered—MMBtu/day                               |   |                               | 192,320      |    |    | 200,697     |   |   | (4 | )% |
| Gas      processed—MMBtu/day                              |   |                               | 72,650       |    |    | 59,797      |   |   | 21 | % |
|     Gas      liquids sold—gallons/day |   |                               | 218,762      |    |    | 183,924     |   |   | 19 | % |
|                                                            |   |                               |         |    |    |        |   |   |   |   |
| General      and administrative expense                         |   | $                                  | 6,089,000    |    | $       | 6,525,000   |   |   | (7 | )% |
| Interest      expense, net                                      |   | $                                  | 477,000      |    | $       | 820,000     |   |   | (42 | )% |
| Income      tax expense (benefit)                               |   | $                                  | (89,761,000  | )       | $       | 45,259,000  |   |   | NM | % |
| Average      interest rate                                      |   |                               | 4.0          | %       |    | 5.4         | % |   | (26 | )% |
| Average      long-term debt outstanding                         |   | $                                  | 195,774,000  |    | $       | 137,995,000 |   |   | 42 | % |

| (1)   | NM      – A percentage calculation is not meaningful due to a zero-value      denominator or a percentage change greater than  200. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | the      amount and nature of our future capital expenditures and how we expect to      fund our capital expenditures; |
|--------|---------|--------|------------------------------------------------------------------------------------------------------------------------|
|   | • |   | the      amount of wells to be drilled or reworked;                                                                    |
|   | • |   | prices      for oil and natural gas;                                                                                   |
|   | • |   | demand      for oil and natural gas;                                                                                   |
|   | • |   | our      exploration prospects;                                                                                        |
|   | • |   | estimates      of our proved oil and natural gas reserves;                                                             |
|   | • |   | oil      and natural gas reserve potential;                                                                            |
|   | • |   | development      and infill drilling potential;                                                                        |
|   | • |   | our      drilling prospects;                                                                                           |
|   | • |   | expansion      and other development trends of the oil and natural gas      industry;                                  |
|   | • |   | our      business strategy;                                                                                            |
|   | • |   | production      of oil and natural gas reserves;                                                                       |
|   | • |   | growth      potential for our mid-stream operations;                                                                   |
|   | • |   | gathering      systems and processing plants we plan to construct or    acquire;                                       |
|   | • |   | volumes      and prices for natural gas gathered and processed;                                                        |
|   | • |   | expansion      and growth of our business and operations;                                                              |
|   | • |   | demand      for our drilling rigs and drilling rig rates; and                                                          |
|   | • |   | our      belief that the final outcome of our legal proceedings will not materially      affect our financial results. |

|   | • |   | the      risk factors discussed in this report and in the documents we incorporate      by reference; |
|--------|---------|--------|-------------------------------------------------------------------------------------------------------|
|   | • |   | general      economic, market or business conditions;                                                 |
|   | • |   | the      nature or lack of business opportunities that wepursue;                                      |
|   | • |   | demand      for our land drilling services;                                                           |
|   | • |   | changes      in laws or regulations;                                                                  |
|   | • |   | the      time period associated with the current decrease in commodity prices;      and               |
|   | • |   | other      factors, most of which are beyond ourcontrol.                                              |

| Term                                   |   | Commodity                                        |   | Hedged      Volume    |   | Weighted      Average Fixed Price for Swaps |   | Hedged      Market          |
|----------------------------------------|--------|--------------------------------------------------|--------|-----------------------|--------|---------------------------------------------|--------|-----------------------------|
| Apr’09      – Dec’09 |   | Crude      oil - collar                          |   | 500      Bbl/day      |   | $100.00      put & $156.25 call         |   | WTI      – NYMEX      |
| Apr’09      – Dec’09 |   | Crude      oil – swap                      |   | 2,000      Bbl/day    |   | $51.87                                      |   | WTI      – NYMEX      |
| Apr’09      – Dec’09 |   | Natural      gas - collar                        |   | 10,000      MMBtu/day |   | $      8.22 put & $10.80 call           |   | IF –      NYMEX (HH)  |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      7.01                                 |   | IF –      Tenn Zone 0 |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      6.32                                 |   | IF –      CEGT        |
| Apr’09      – Dec’09 |   | Natural      gas – swap                    |   | 25,000      MMBtu/day |   | $      5.57                                 |   | IF –      PEPL        |
|                                   |   |                                             |   |                  |   |                                        |   |                        |
| Jan’10      – Dec’10 |   | Crude      oil – swap                      |   | 500      Bbl/day      |   | $64.45                                      |   | WTI      – NYMEX      |
| Jan’10      – Dec’10 |   | Crude      oil – swap                      |   | 1,000      Bbl/day    |   | $59.81                                      |   | WTI      – NYMEX      |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 15,000      MMBtu/day |   | $      7.20                                 |   | IF –      NYMEX (HH)  |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 20,000      MMBtu/day |   | $      6.89                                 |   | IF –      Tenn Zone 0 |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 30,000      MMBtu/day |   | $      6.12                                 |   | IF –      CEGT        |
| Jan’10      – Dec’10 |   | Natural      gas – swap                    |   | 20,000      MMBtu/day |   | $      5.67                                 |   | IF –      PEPL        |
| Jan’10      – Dec’10 |   | Natural      gas – basis differential swap |   | 10,000      MMBtu/day |   | ($0.79)                                     |   | PEPL      – NYMEX     |

| Period                                             |         | (a)TotalNumber      ofSharesPurchased      (1) |         | (b) Average Price Paid Per Share(2) |    | (c)TotalNumberof      SharesPurchasedAs      Part ofPubliclyAnnouncedPlans      orPrograms      (1) |    | (d)MaximumNumber      (orApproximateDollar Value)of      SharesThat      MayYet      BePurchasedUnder      thePlans      orPrograms |
|----------------------------------------------------|--------------|------------------------------------------------|--------------|--------------------------------------------------------------|---------|-----------------------------------------------------------------------------------------------------|---------|------------------------------------------------------------------------------------------------------------------------------------------|
| January 1,      2009 to January 31, 2009 |    | 19,470                                         |    | $                                                            | 29.66   |                                                                                           | 19,470  |                                                                                                                                | — |
| February 1,      2009 to February 28, 2009    |    | —                                        |    |                                                         | — |                                                                                           | — |                                                                                                                                | — |
| March 1,      2009 to March 31, 2009     |    | —                                        |    |                                                         | — |                                                                                           | — |                                                                                                                                | — |
|                                               |    |                                           |    |                                                         |    |                                                                                           |    |                                                                                                                                |   |
| Total                                              |    | 19,470                                         |    | $                                                            | 29.66   |                                                                                           | 19,470  |                                                                                                                                | — |
|                                               |         |                                           |         |                                                         |    |                                                                                                |    |                                                                                                                                     |   |

----

| (1)    | The      shares were repurchased to remit withholding of taxes on the value of      stock distributed with the January 1, 2009 and January 5, 2009 vesting      distribution for grants previously made from our “Unit Corporation Stock      and Incentive Compensation Plan” adopted May 3, 2006. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                            |
| (2)    | The      price paid per common share represents the closing sales price of a share      of our common stock as reported by the NYSE on the day that the stock was      acquired by us.                                                                                                                          |

|   | 15     | Letter      re:  Unaudited Interim Financial Information.                         |
|--------|--------|---------------------------------------------------------------------------------------------|
|   |   |                                                                                        |
|   | 31.1   | Certification      of Chief Executive Officer under Rule 13a – 14(a) ofthe            |
|   |   | Exchange      Act.                                                                          |
|   |   |                                                                                        |
|   | 31.2   | Certification      of Chief Financial Officer under Rule 13a – 14(a) ofthe            |
|   |   | Exchange      Act.                                                                          |
|   |   |                                                                                        |
|   | 32     | Certification      of Chief Executive Officer and Chief Financial Officer    under          |
|   |   | Rule      13a – 14(a) of the Exchange Act and 18 U.S.C. Section 1350, as      adopted |
|   |   | under      Section 906 of the Sarbanes-Oxley Act of2002.                                    |

|                              |                                      | Unit      Corporation |
|-----------------------------------|-------------------------------------------|-----------------------|
| Date:  May      5, 2009 | By:  /s/ Larry D.      Pinkston |
|                              | LARRY      D. PINKSTON                    |
|                              | Chief      Executive Officer and Director |
|                              |                                      |
| Date:  May      5, 2009 | By:  /s/ David T.      Merrill  |
|                              | DAVID      T. MERRILL                     |
|                              | Chief      Financial Officer and          |
|                              | Treasurer                                 |