17 SEPTEMBER 2026 WorldWide Drilling Resource® Drilling Into Money Not Boring by Mark E. Battersby Successful Succession Planning What is going to happen to the drilling business built up and nurtured over the years when the owner retires? Who’s going to lead the business in the years ahead? Will ties with the business be severed or will it be used as a source of retirement income for the departing owner? A succession plan for the business can help ensure a closely held or family drilling business, however big or small, will continue to operate successfully when the owner or owners exit, retire, pass away, or are suddenly incapacitated. There are a number of transition strategies which should be addressed in a good succession plan, including: c Founder transition: How long does the owner plan to stay involved in the drilling business; what are his or her retirement plans, if any? c Family Transition: If the plan is to leave the business to family members, how will roles and power relationships change? How will family harmony be maintained through the transition? Succession planning for drilling professionals - or any business owner or partner - is an ongoing process of identifying and developing internal talent to fill safety-critical, technical, and leadership roles. It prevents costly operational disruptions, preserves decades of specialized field expertise, and ensures workforce stability across your crews. Traditional succession planning usually involves a very narrow list of so-called "safe picks." The basic plan coaches potential candidates with targeted leadership training that focuses on safety culture, communication, and team building. Because the drilling industry is rapidly changing, the search for potential future leadership must be agile. Will management consist of family, nonfamily, or both? Among the mistakes in succession planning is passing over nonfamily candidates or focusing on replacements rather than roles, and ignoring future potential. The most common mistake, however, is procrastinating or entirely failing to plan. A well-thought-out, effective succession plan will provide a smooth transition in management and ownership - with a minimum tax bite. Fortunately, planning can minimize the tax burden by leveraging lifetime exemptions, annual gifting, and structured sales. Utilizing the federal estate tax exemption (up to $15 million for individuals or $30 million for married couples) and gifting portions of the business under the annual exclusion (e.g., $19,000 per recipient) can be effective. Remember, succession planning is a contingency plan - not a one-time event. Given the number and complexity of succession options available, truly effective succession planning requires time, and the assistance of outside advisers. Mark Mark E. Battersby may be contacted via e-mail to michele@worldwidedrillingresource.com
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