UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.    )

Filed by the Registrant  ¨                            Filed by a Party other than the Registrant  ¨

Check the appropriate box:

PIONEER DRILLING COMPANY

1250 N.E. Loop 410, Suite 1000

San Antonio, Texas 78209

April 10, 2012

Dear Shareholder:

On behalf of the board of directors, we invite you to attend the 2012 Annual Meeting of Shareholders of Pioneer Drilling Company. We will hold the meeting at 1:00 p.m., Central time, on Thursday, May 10, 2012, at the Petroleum Club of San Antonio, 7th Floor of the Energy Plaza Building, 8620 N. New Braunfels Street, San Antonio, Texas.

On the following pages you will find the Notice of Annual Meeting of Shareholders and Proxy Statement giving information concerning the matters to be acted on at the meeting. Our Annual Report to Shareholders describing Pioneer Drilling Company’s operations during the fiscal year ended December 31, 2011, is enclosed.

We hope you will be able to attend the meeting in person. Whether or not you plan to attend, please take the time to vote by completing and returning your proxy card in the enclosed envelope before the meeting. If you attend the meeting, you may, if you wish, revoke your proxy and vote in person.

Thank you for your interest in Pioneer Drilling Company.

Sincerely,

Dean A. Burkhardt		Wm. Stacy Locke
Chairman		President and Chief Executive Officer

PIONEER DRILLING COMPANY

1250 N.E. Loop 410, Suite 1000

San Antonio, Texas 78209

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To Be Held Thursday, May 10, 2012

To the Shareholders of Pioneer Drilling Company:

The 2012 Annual Meeting of Shareholders of Pioneer Drilling Company will be held on Thursday, May 10, 2012, at 1:00 p.m., Central time, at the Petroleum Club of San Antonio, 7th Floor of the Energy Plaza Building, 8620 N. New Braunfels Street, San Antonio, Texas. At the meeting, we will ask you to consider and take action on the following:

This notice and the attached proxy statement are first being mailed to our shareholders on or about April 10, 2012. Our board of directors has set the close of business on March 22, 2012, as the record date for determining shareholders entitled to receive notice of and vote at the annual meeting. A list of all shareholders entitled to vote is available for inspection during normal business hours at our principal executive offices at 1250 N.E. Loop 410, Suite 1000, San Antonio, Texas 78209. This list will also be available at the meeting.

Important notice regarding the availability of proxy materials for the shareholder meeting to be held on Thursday, May 10, 2012. The proxy statement and annual report to shareholders are available at www.pioneerproxy.com.

Your vote is very important. Whether or not you plan to attend the annual meeting, we encourage you to read the proxy statement. Further, to be sure your vote counts and to assure a quorum, please vote, sign, date and return the enclosed proxy card, whether or not you plan to attend the meeting.

San Antonio, Texas

April 10, 2012

PIONEER DRILLING COMPANY

PROXY STATEMENT

FOR 2012 ANNUAL MEETING OF SHAREHOLDERS

QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING

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We will count abstentions and broker non-votes as present for the purpose of establishing a quorum. A broker “non-vote” occurs when a broker holding shares for a beneficial owner does not vote on a particular proposal because the broker does not have discretionary voting power for that particular proposal and has not received instructions from the beneficial owner. If a quorum is not present, a majority in interest of those present or represented at the annual meeting may adjourn the meeting, without notice other than an announcement at the meeting, until a quorum is present or represented.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL

OWNERS AND MANAGEMENT

The following table shows the beneficial ownership of our common stock as of March 15, 2012 by (1) each person (or group of affiliated persons) who is known by us to beneficially own more than 5% of our common stock, (2) each of our directors and nominees, (3) each of the named executive officers listed in the summary compensation table in this proxy statement and (4) all our directors and executive officers as a group. As of March 15, 2012, we were not aware of any person beneficially owning more than 5% of the outstanding shares of our common stock, other than those listed below. Unless otherwise indicated below, all shareholders have the same principal business address as Pioneer. All persons listed in the table below have sole voting and investment power with respect to their shares unless otherwise indicated. As of March 15, 2012, there were 61,880,310 shares of common stock outstanding.

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PROPOSAL 1

ELECTION OF DIRECTORS

Our board of directors currently consists of five directors. Our board of directors is divided into three separate classes (Class I, Class II and Class III) with staggered terms. The current term of office for our Class II directors will expire at the annual meeting.

Our board of directors has nominated Wm. Stacy Locke and C. John Thompson, who currently serve on the board of directors, as the nominees for election at the annual meeting as Class II directors. Mr. Locke has served as one of our directors since May 1995 and Mr. Thompson has served as one of our directors since May 2001.

Assuming the presence of a quorum, directors will be elected by a plurality of the votes cast by the holders of shares of capital stock of Pioneer entitled to vote on the election of directors at the annual meeting. Any abstentions or broker non-votes will not affect the vote.If you properly sign and return the enclosed proxy, unless you withhold authority to vote for the nominees, the persons named as proxies will vote FOR the election of the nominees listed below. Each of the nominees has agreed to serve if elected, however, if any of the nominees becomes unable or unwilling to serve as a director, the persons named as proxies intend to vote the proxy shares for the election of any other person the board of directors may designate.

Nominees

Wm. Stacy Locke has served as one of our directors as well as President of the Company since May 1995, when he joined Pioneer. In December 2003, Mr. Locke was appointed Chief Executive Officer. In addition to his continuous role as President, Mr. Locke has also served as Chief Financial Officer and Chief Operating Officer. Prior to joining Pioneer, Mr. Locke was in investment banking with Arneson, Kercheville, Ehrenberg & Associates from 1993 to 1995 and Chemical Banking Corporation from 1988 to 1992. Mr. Locke worked for Valero Energy Corporation, Huffco Petroleum Corporation and Tesoro Petroleum Corporation as a geologist from 1979 to 1986. Mr. Locke received a Bachelor’s Degree in geology from the University of California Santa Barbara and a Master of Business Administration Degree from Southern Methodist University.

Mr. Locke’s seventeen years of experience at Pioneer, including his service as Chief Executive Officer for nine years, gives him unique knowledge of the opportunities and challenges associated with our business. Mr. Locke’s familiarity with all aspects of Pioneer’s business and his historical understanding of its operations, combined with his understanding of the oil and gas industry, geology and investment banking makes him uniquely qualified to advise the board of directors and to lead Pioneer as Chief Executive Officer.

C. John Thompson has served as one of our directors since May 2001. Mr. Thompson currently serves as Chairman and Chief Executive Officer of Ventana Capital Advisors, Inc., a capital advisory company he founded in June 2004. Mr. Thompson has over 30 years experience in the energy capital business. Mr. Thompson has worked as a business consultant, in the energy capital business with Enron, the investment banking services business with a company he co-founded, Sagestone Capital Partners, and as the manager of the energy commercial banking business with InterFirst Bank in Houston.

As one of Pioneer’s longest-serving non-executive directors, Mr. Thompson brings an important institutional knowledge to the board of directors. His work as an executive in the oil and gas industry, and his

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experience in the energy capital business including more than ten years in energy commercial banking, provides him with insights relating to many of the same issues facing our business, including markets, operational, regulatory, technological, and financial. Mr. Thompson also serves as a member of the Audit Committee and qualifies as an “audit committee financial expert.” Mr. Thompson holds a Master’s Degree in Business Administration with an emphasis in finance and accounting from the University of Texas at Austin, which enables him to provide guidance to the Board on finance and accounting-related matters. Mr. Thompson’s experience as founder of a capital advisory company and as a consultant provides the board of directors with a unique perspective into different industries and an understanding of various capital strategies.

Our board of directors unanimously recommends a vote “FOR” the election of Wm. Stacy Locke and C. John Thompson as Class II Directors.

DIRECTORS WITH A TERM EXPIRING IN 2013

John Michael Rauh has served as one of our directors since October 2008. Mr. Rauh served in various financial capacities including Vice President and Controller and Vice President and Treasurer during his career at Kerr-McGee Corporation from 1981 until his retirement in 2006. Prior to joining Kerr-McGee, Mr. Rauh was an auditor with Arthur Young & Company, which merged with Ernst & Whinney in 1989 to form Ernst & Young. He received a Master’s Degree in accounting from Oklahoma State University and a Bachelor’s Degree in accounting and economics from Northwestern Oklahoma State University. Mr. Rauh was elected in 2010 and currently serves as a director on the Northwestern Oklahoma State University Foundation Board of Directors. Mr. Rauh served as a director of Tronox, Inc. from 2005 to 2006. Mr. Rauh, as well as other Tronox and Kerr-McGee officers and directors, has been named as a defendant in a Complaint filed in the United States District Court for the Southern District of New York asserting securities law violations. The Court has dismissed the allegations that Mr. Rauh violated Section 10(b) of the Securities Exchange Act. Mr. Rauh currently remains in the case only with respect to allegations that he was a “control person” of Tronox under Section 20 of the Securities Exchange Act for approximately a four-month period. There are no current allegations that Mr. Rauh directly violated any securities laws. Mr. Rauh plans to defend against the control person allegations as the litigation continues.

Mr. Rauh’s expertise in a variety of financial and accounting matters, experience in Sarbanes-Oxley 404 compliance and service with a global oil and gas business make him a valuable member of the board of directors and enhances the value of his service as a member of the Audit Committee, where he also qualifies as an “audit committee financial expert.” Mr. Rauh’s Bachelor’s and Master’s Degrees in accounting enable him to advise the Board on accounting-related matters. Mr. Rauh’s experience at a global oil and gas company provide him with insights relating to many of the same issues we face in our business, including markets, operational, regulatory, technological, and financial. Mr. Rauh’s significant experience in several senior financial positions at Kerr-McGee, as well as his previous service as an auditor with an accounting firm, provides a solid platform for him to advise and consult with the board of directors on financial and audit-related matters.

DIRECTORS WITH A TERM EXPIRING IN 2014

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Dean A. Burkhardt has served as one of our directors since October 26, 2001 and Chairman since May 2008. In addition to his role as a horse and cattle rancher, Mr. Burkhardt has been a consultant to the energy services industry since 1997 with a special emphasis in oil and gas projects in emerging markets, workover services, fuel cells and engineering and quality management services. He also served as co-founder, President and CEO (1983-1985) of Applied Petroleum Software, a provider of production engineering software for optimizing oil and gas well completions; President and CEO of Seismic Products, a provider of seismic cable (1982), Cliff Mock, Inc., a provider of oilfield valves (1982) and Tescorp Energy Services, a provider of coiled tubing, hydraulics and fishing and rental tools (1981-1982) as well as President and COO of Tescorp, Inc. (1982); was a co-founder (1979), Executive Vice President of Sales and Operations (1979-1981) and a director (1979-1989) of Cheyenne Services, Inc., a provider of oilfield tubular makeup, tubular inspection and third party quality assurance services.

As a result of Mr. Burkhardt’s service as a director of the Company for over nine years, he has become very familiar with our business and the important issues facing the Company. Mr. Burkhardt’s experience as a consultant in the energy services industry makes him a valuable member of the board of directors. Mr. Burkhardt serves as a member of the Audit Committee and qualifies as an “audit committee financial expert.” Mr. Burkhardt also holds a Master’s Degree in international management, with an emphasis in marketing and accounting from the American Graduate School of International Management and regularly attends seminars on accounting and financial matters, which enables him to provide guidance to the board of directors related to the Company’s international development and accounting-related matters. Mr. Burkhardt’s significant experience with several companies involved in the oil and gas industry gives him insights relating to many of the same issues we face in our business and provides a solid platform for him to advise and consult with the board of directors on such issues, including oil and gas projects in emerging markets, workover services, fuel cells and engineering and quality management services.

Scott D. Urban has served as one of our directors since October 2008. Mr. Urban is a partner in Edgewater Energy, a consulting and investment firm focused on the oil and gas exploration and production industry and assisting private equity firms with upstream investments. Mr. Urban served as Group Vice President, Upstream, for BP PLC from 1999 to 2005 and served as BP’s Group Vice President, with responsibility for several profit centers including the North Sea, Atlantic, North American Onshore, Egypt and Middle East. Prior to joining BP, Mr. Urban held a variety of management positions with Amoco Corporation, including Group Vice President, Worldwide Exploration and Upstream Business Unit Manager, China. Mr. Urban received a Master’s Degree in geology and a Bachelor’s Degree in earth science from Bowling Green State University. Mr. Urban currently serves on the board of directors of Noble Energy, Inc. and has served as a board member of the UK Offshore Operators Association, the Business Council for International Understanding and the Netherlands Oil and Gas Exploration and Production Association.

Mr. Urban’s expertise as a consultant in the oil and gas exploration and production industry makes him a valuable member of the board of directors. Mr. Urban’s significant experience at multiple global oil and gas companies provides him with insights relating to many of the same issues we face in our business, including markets, operational, regulatory, technological, and financial. Mr. Urban’s Master’s Degree in geology gives him a deep understanding of, and enables him to advise the board of directors on, many matters relating to oil and gas drilling. Mr. Urban’s service as a member of the board of directors of Noble Energy, Inc. gives him valuable experience in managing the issues that face a publicly held oil and gas company with international operations and allows him to share best practices with our board of directors.

There are no family relations of first cousin or closer among our directors or executive officers by blood, marriage or adoption. The board has determined that all of our directors are independent directors, as defined by the rules of the NYSE Amex, other than Mr. Locke who, as President and Chief Executive Officer, is an employee of Pioneer.

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INFORMATION CONCERNING MEETINGS

AND COMMITTEES OF THE BOARD OF DIRECTORS

Director Meetings

Our board of directors held eight meetings and acted by written consent seven times during the fiscal year ended December 31, 2011. The board has three standing committees: an audit committee; a compensation committee; and a nominating and corporate governance committee. During the fiscal year ended December 31, 2011, all of the directors attended 100% of the total number of meetings of the board and any committee on which each served. In addition, the independent directors also held regular meetings consisting solely of independent directors during the fiscal year ended December 31, 2011.

Independent Chairman of the Board

Our board of directors has separated the roles of Chairman and Chief Executive Officer. The separation of roles was implemented to allow our Chief Executive Officer, Mr. Locke, to focus on the management of the Company and our independent Chairman to focus on the continued development of a high-performing board of directors, including (i) developing board agendas, (ii) working with Company management to ensure the board of directors has timely and adequate information, (iii) coordinating board committee activities, (iv) supporting and mentoring the Chief Executive Officer and (v) ensuring effective stakeholder communications. Among the duties and responsibilities of our independent Chairman are the following:

Audit Committee

The members of our audit committee during the fiscal year ended December 31, 2011 were Messrs. Burkhardt, Thompson, Rauh (chairman) and Mr. Urban. Mr. Rauh served as the chairman of the audit committee during the fiscal year ended December 31, 2011. The audit committee met five times during the fiscal year ended December 31, 2011. The audit committee is governed by a charter that the board of directors amended and restated on December 11, 2008. You can obtain a copy of that charter by going to our Web site atwww.pioneerdrlg.com.

Our common stock is listed on the NYSE Amex. As such, we have agreed to comply with the listing standards of the NYSE Amex, which require that we have at least three members of the audit committee, each of whom is independent. Each of our audit committee members is independent, as defined by the rules of the NYSE Amex and the rules and regulations of the SEC. In addition, the board has determined that each member of the audit committee is an “audit committee financial expert” as defined by the SEC. The experience of each member of the audit committee is described in the biographies under the heading “Proposal 1—Election of Directors.”

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The audit committee’s role is one of financial oversight. Our management is responsible for preparing our financial statements, and our independent auditors are responsible for auditing those financial statements. The audit committee is not providing any expert or special assurance as to our financial statements or any professional certification as to the independent auditors’ work. The following functions are the key responsibilities of the audit committee in carrying out its oversight:

The audit committee meets separately from the whole board with the independent auditors to provide an open avenue of communication. The audit committee is ultimately responsible for the selection, evaluation and replacement of our independent auditors.

Compensation Committee

The members of our compensation committee during the fiscal year ended December 31, 2011 were Messrs. Burkhardt, Thompson, Urban (chairman) and Mr. Rauh. Mr. Urban served as chairman of the compensation committee during the fiscal year ended December 31, 2011.The compensation committee met four times and acted by written consent ten times during the fiscal year ended December 31, 2011. In addition, the compensation committee also held meetings with our compensation consultant during the fiscal year ended December 31, 2011. Each of our compensation committee members is independent, as defined by the rules of the NYSE Amex. The compensation committee is governed by a charter that the board amended and restated on December 11, 2008. You can obtain a copy of that charter by going to our Web site at www.pioneerdrlg.com. The compensation committee’s responsibilities include:

Except as described in the Compensation Discussion and Analysis section of this proxy statement, at this time, the compensation committee does not intend to delegate its powers and authority to any subcommittee or other persons. For additional information concerning the compensation committee, see “Compensation Discussion and Analysis” and “Report of the Compensation Committee.”

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Nominating and Corporate Governance Committee

The members of our nominating and corporate governance committee during the fiscal year ended December 31, 2011 were Messrs. Burkhardt, Thompson (chairman), Urban and Mr. Rauh. Mr. Thompson served as chairman of the nominating and corporate governance committee during the fiscal year ended December 31, 2011. The nominating and corporate governance committee held two meetings during fiscal year ended December 31, 2011. Each of our nominating and corporate governance committee members is independent, as defined by the rules of the NYSE Amex.

The nominating and corporate governance committee is responsible for seeking, evaluating and recommending qualified individuals to become directors and serve on committees of the board of directors. The committee is also responsible for periodically reviewing and assessing the adequacy of our corporate governance policies and procedures and recommending proposed changes to the board. In addition, the committee periodically assesses the performance of the board of directors. The nominating and corporate governance committee is governed by a charter that the board amended and restated on December 11, 2008. You can obtain a copy of that charter by going to our website atwww.pioneerdrlg.com.

Director Nominations

The nominating and corporate governance committee considers candidates for board membership suggested by its members and other board members, as well as by management and shareholders. The committee may also retain a third-party executive search firm to identify candidates from time to time. Shareholders wishing to suggest a qualified candidate should submit the recommendation in writing to the nominating and corporate governance committee in care of our Corporate Secretary at 1250 N.E. Loop 410, Suite 1000, San Antonio, Texas 78209. Any shareholder wishing to submit a candidate for consideration should send the following information to the Corporate Secretary:

Once a prospective candidate has been identified, the nominating and corporate governance committee makes the initial determination as to whether to conduct a full evaluation of the candidate. This initial determination is based on the information provided to the committee with the recommendation of the prospective candidate, as well as the committee’s own knowledge of the prospective candidate, which may be supplemented by inquiries to the person making the recommendation or others. If the committee determines that additional consideration is warranted, it may ask a third-party search firm to gather additional information about the candidate’s background and experience and to report its findings to the committee. The committee then evaluates the prospective candidate by considering, in addition to the criteria set forth in our bylaws, each nominee’s personal and professional integrity, experience, skills, ability and willingness to devote the time and effort necessary to be an effective board member, and commitment to acting in our shareholders’ and our best interests. Consideration is also given to members of the board of directors having an appropriate mix of background and skills. Although we do not have a formal diversity policy in place for the director nomination process, an important factor in our nominating and corporate governance committee’s consideration and assessment of a candidate is the diversity of the candidate’s background, viewpoints, training, professional experience, education and skill set. The nominating and corporate governance committee strives to nominate candidates with a variety of complementary skills so that, as a group, the board of directors will possess the appropriate talent, skills, and expertise to oversee the Company’s business.

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The same criteria apply with respect to the nominating and corporate governance committee’s evaluation of all candidates for membership to our board, including candidates recommended by shareholders. However, additional procedures will apply, as provided in our bylaws, if a shareholder wishes to submit at an annual meeting a director candidate who is not approved by our nominating and corporate governance committee or our board of directors.

Any shareholder desiring to nominate a director at our 2013 Annual Meeting of Shareholders without including such nomination in our proxy materials for that meeting must provide timely notice to the Company of such nomination in the form provided by our bylaws. See our bylaws for a description of the required form and content of this notice. To be timely, such notice must ordinarily be delivered to our principal executive offices (Attention: Corporate Secretary), at the address set forth above, no later than the close of business on the 90th day nor earlier than the 180th day prior to the first anniversary date of the preceding year’s annual shareholder meeting (i.e., nominations for director for inclusion in the 2013 Annual Meeting of Shareholders must be delivered to our principal executive offices no earlier than the close of business on November 9, 2012, and no later than the close of business on February 11, 2013), or such proposal will be considered untimely. However, in the event that the date of the pending annual meeting of shareholders is more than 30 days before or more than 60 days after the first anniversary of the previous year’s annual meeting of shareholders, then such notice must be received not later than the later to occur of the close of business on the 90th day prior to the pending annual meeting of shareholders or the 10th day following the day on which public announcement of the date of such annual meeting of shareholders is first made by the Company. The foregoing time limits also apply in determining whether notice is timely for purposes of rules adopted by the SEC relating to the exercise of discretionary voting authority.

Any shareholder desiring a copy of our bylaws will be furnished one without charge upon written request to the Corporate Secretary at 1250 N.E. Loop 410, Suite 1000, San Antonio, Texas 78209.

Code of Conduct and Ethics and Corporate Governance Guidelines

We have adopted a Code of Conduct and Ethics that satisfies the SEC’s definition of a “Code of Ethics” and applies to all employees, including our principal executive officer, principal financial officer and principal accounting officer. As part of our continuing efforts to improve our corporate governance principles and practices, we have also adopted Corporate Governance Guidelines that conform to the NYSE corporate governance listing standards and SEC rules. All of the Company’s corporate governance materials, including the Code of Conduct and Ethics, the Corporate Governance Guidelines, and our committee charters are posted on the Company’s website atwww.pioneerdrlg.com and are also available upon request to the Company’s Corporate Secretary. We intend to disclose on our website any amendments to the Code of Conduct and Ethics and any waivers of the Code of Conduct and Ethics that apply to our principal executive officer, principal financial officer and principal accounting officer.

Board’s Role in Risk Oversight

Our board of directors is responsible for the Company’s risk-oversight function. The board of directors, with the assistance of its standing committees, our Chief Executive Officer, our Chief Financial Officer, our General Counsel, and our Director of Corporate Development, identifies, evaluates and discusses the material enterprise risks that could impact the Company’s operations and tactical and strategic decisions. These enterprise risks include operational, financial, legal, regulatory, market, and reputational risks. In addition, the board of directors reviews the risks associated with the Company’s strategic plan at an annual strategic planning session and periodically throughout the year as part of its consideration of the strategic direction of the Company. Each board committee also oversees the management of the Company’s risks that fall within each committee’s areas of responsibility. In performing this function, each committee has full access to management, as well as the ability to engage advisors.

Risk–Related Compensation Policies and Practices

The compensation committee has undertaken an assessment of the risk profile of its executive and non-executive compensation programs. With the assistance of our Chief Executive Officer, our Chief Financial

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Officer, our General Counsel, our Vice President Global Human Resources and our compensation consultant, the compensation committee has developed a framework to assist the compensation committee in ascertaining any potential material risks associated with its executive compensation program, including: external market reference; pay mix; range and sensitivity of performance-based variable plans; selection of performance metrics; goal-setting process; and the Company’s checks and balances on the payment of compensation. This process enables the compensation committee to consider if any of the Company’s current compensation programs, practices or procedures should be altered in order to ensure that an appropriate balance between competitive pay and prudent risk is maintained. As a result of this analysis, the compensation committee has identified the following risk mitigating factors:

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As a result of the above assessment, the compensation committee believes that the Company’s compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.

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Director Compensation

During 2011, we paid to each of our non-employee directors fees for service on our board of directors or committees of our board as follows:

During 2011, the Compensation Committee granted a restricted stock award that will vest over three years with a grant date fair market value of approximately $100,000 to each member of the board of directors. In addition, we reimburse the directors for reasonable out-of-pocket expenses they incur in connection with attending meetings of the board of directors and board committees or otherwise in their capacity as directors. Our executive officers do not make recommendations regarding the non-employee directors’ compensation.

We expect each director to make every effort to attend each meeting of the board of directors, each meeting of any board committee on which he sits and the annual meeting of shareholders. Attendance in person at board and committee meetings is preferred but not required; attendance by teleconference is permitted, if necessary. All of our directors attended last year’s annual meeting of shareholders.

2011 Non-Employee Director Compensation

The following table summarizes the compensation we paid each of our non-employee directors during 2011:

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The following table provides information on the outstanding equity awards for each of our non-employee directors as of December 31, 2011:

Stock Ownership Guidelines

In order to encourage the acquisition and retention of our common stock by our directors and to further align their economic interests with those of our shareholders and to focus our directors on the long-term sustained appreciation of our common stock, our compensation committee and our board of directors have adopted guidelines generally requiring each of our directors to own an amount of our common stock equal to the value of three times such director’s annual cash retainer. The ownership target is to be acquired no later than the December 31 following the fifth anniversary of the director’s initial appointment or election to the board of directors, or by December 31, 2013 for any director serving on the board of directors as of May 17, 2008. For purposes of this calculation, unvested restricted stock and restricted stock units may be counted toward the applicable ownership requirement. As of March 15, 2012, all directors have fully met their stock ownership requirements.

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EXECUTIVE OFFICERS

The following table provides information about our current executive officers (ages are as of March 31, 2012):

For a description of the business background of Mr. Locke, see “Class II Director Nominees for Election to a Term Expiring at the 2015 Annual Meeting” above.

Lorne E. Phillips was appointed Executive Vice President and Chief Financial Officer effective February 1, 2009. Prior to joining Pioneer Drilling Company, Mr. Phillips worked the last 10 years at Cameron International Corporation, serving most recently as Vice President and Treasurer. Prior to that, he was General Manager of Cameron’s Canadian valves operations, Vice President of Marketing and M&A for the valves division, and Business Development Manager for Cameron. Before joining Cameron, he was a Financial Analyst for SCF Partners, a provider of equity capital to energy service and equipment companies, and for Simmons & Company International, an investment bank focused on the energy industry.

Franklin C. Westcurrently serves as Executive Vice President and President of our Drilling Services Division. Prior to his appointment as President of our Drilling Services Division on March 1, 2008, Mr. West served as our Chief Operating Officer beginning in January 2002. Prior to joining Pioneer, he was Vice President for Flournoy Drilling Company from 1967 until it was acquired by Grey Wolf, Inc. in 1997, and he continued in the same capacity for Grey Wolf, Inc., an on-shore oil and gas drilling contractor, until December 2001.

Joseph B. Eustace was appointed as Executive Vice President and President of our Production Services Division on March 1, 2008. Prior to joining Pioneer Drilling Company, Mr. Eustace served as President of WEDGE Oil and Gas Services beginning in 2004. Prior to 2004, Mr. Eustace served as Group Vice President for Key Energy Services from 1998 to 2004, and as Vice President of Operations for Dawson Production Services from 1982 until Key Energy Services acquired Dawson Production Services in 1998.

Carlos R. Peña was appointed Senior Vice President, General Counsel, Secretary and Compliance Officer effective October 27, 2008. Mr. Peña has practiced law since 1992 and has experience providing both outside corporate and securities counsel and in-house M&A counsel. Prior to joining Pioneer Drilling in October 2008, he worked for AT&T, Inc. in the M&A legal group. From 1996 to 2007, he focused on securities and corporate finance, M&A, venture capital, and corporate governance at Fulbright & Jaworski L.L.P., Cox Smith Matthews Incorporated, and Vinson & Elkins L.L.P.

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COMPENSATION DISCUSSION AND ANALYSIS

This compensation discussion and analysis provides information regarding our executive compensation program in 2011 for the following executive officers of the Company (collectively, the “named executive officers”):

Executive Summary

Throughout 2011, demand for our equipment and services continued to grow, driving a 47% increase in annual revenue. Operationally, we exceeded the level of overall performance that we had targeted for 2011, which is reflected in some of the compensation decisions reached by the Compensation Committee. Key highlights of our 2011 performance include the following:

The Compensation Committee took the following key actions with respect to the compensation of the named executive officers in 2011:

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We believe that our 2011 executive compensation program is reasonable, competitive and strongly aligned with pay-for-performance principles. Consistent with prior practice, in 2011 the Compensation Committee emphasized compensation opportunities that reward our named executive officers when they deliver targeted financial and operational results. Accordingly, a significant percentage of the named executive officers’ compensation that was granted in 2011 was “at-risk,” as the following graph illustrates:

2011 Shareholder Advisory Vote on Executive Compensation

We conducted our first advisory vote on executive compensation last year at our 2011 Annual Meeting of Shareholders. While this vote was not binding on the Compensation Committee, the Board of Directors or us, the Compensation Committee values the opinions of our shareholders on executive compensation matters.

The Compensation Committee reviewed the voting results from our 2011 advisory vote on executive compensation. Based upon the Inspector of Election’s report, the advisory vote on executive compensation received the favorable support of 95% of the votes cast thereon. The Compensation Committee determined that the voting results reflect strong shareholder support for our 2011 executive compensation program.

In 2012, the Compensation Committee continued to emphasize pay for performance principles by increasing the allocation of the named executive officers’ long-term incentive compensation to provide for more performance-based RSU awards and less stock options. Accordingly, the Compensation Committee changed the allocations of the named executive officers’ performance-based RSU awards to 40% (from 30%) and stock options to 60% (from 70%) to better align the named executive officer’s long-term incentive compensation with our shareholders’ interests.

Additionally, in response to the majority of the votes cast for an advisory vote on executive compensation every year at our 2011 Annual Meeting of Stockholders, we have determined that the advisory vote on executive compensation will be conducted every year, until we hold the next advisory vote on the frequency of advisory votes on executive compensation.

Compensation Philosophy

The Compensation Committee designs our executive compensation programs to:

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Compensation Committee

The Compensation Committee administers our executive compensation program and is responsible for establishing appropriate compensation for our named executive officers. The duties of the Compensation Committee include:

Role of Management

The Compensation Committee believes that even the best advice of a compensation consultant or other outside advisors must be combined with the input from senior management and the Compensation Committee’s own individual experiences and judgment to arrive at the proper alignment of compensation philosophy, objectives, and programs. In 2011, the Chief Executive Officer, Chief Financial Officer, Vice President Global Human Resources, and General Counsel worked closely with the Compensation Committee in formulating award designs, performance measures, and performance levels (i.e., threshold, target, and above expectation) necessary to align the executive compensation program with our objectives and strategies.

Generally, the Chief Executive Officer reviews with the Compensation Committee his performance evaluations of the other named executive officers and his recommendations regarding base salary adjustments, cash incentive awards, and long-term equity awards for the other named executive officers to ensure alignment with pay-for-performance principles. However, all final decisions regarding the compensation of the named executive officers are made by the Compensation Committee.

The Board and Compensation Committee conduct their own performance assessment of the Chief Executive Officer and no management recommendation is made with regard to his compensation.

While certain members of management attended the Compensation Committee’s meetings in 2011 upon invitation, they did not attend either private sessions or portions of any other meetings of the Compensation Committee where executive compensation determinations were made by the Compensation Committee.

Assessment of Team Performance

The named executive officers’ compensation is impacted by their performance as a team. For purposes of setting compensation, the Compensation Committee annually conducts a subjective assessment of the named executive officers’ accomplishments as a team and not as individuals with respect to goals and strategies that are established at the beginning of each year. The Compensation Committee believes that focusing on team performance, rather than individual performance, emphasizes the importance of team work among the named executive officers.

The 2011 team goals included the following (collectively, the “2011 Team Goals”):

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The Compensation Committee subjectively determined that the named executive officers successfully accomplished each of the 2011 Team Goals during 2011.

Role of Compensation Consultant

During 2011, the Compensation Committee retained Pearl Meyer & Partners (“Pearl Meyer”) as its compensation consultant to obtain objective, expert advice on executive compensation. Pearl Meyer advised the Compensation Committee on a variety of compensation related issues in 2011, including:

In the course of conducting its activities, Pearl Meyer attended meetings of the Compensation Committee and presented its findings and recommendations for discussion. During 2011, Pearl Meyer also met with certain senior management to obtain and validate data and review materials.

Competitive Pay Analysis

Each year the Compensation Committee evaluates how our pay practices and the named executive officers’ compensation levels compare to the competitive market for executive talent.

To evaluate the competitiveness of the named executive officers’ base salary, target total cash compensation (i.e., base salary plus target cash incentive award), target long-term equity incentive awards, and total direct compensation (i.e. base salary, target cash incentive award, and target long-term equity incentive awards) for 2011, Pearl Meyer provided the Compensation Committee competitive pay information derived from a custom peer group (the “Custom Peer Group”) and the following industry specific surveys (collectively, the “Industry Survey Data”):

The companies comprising the Custom Peer Group for 2011 included:

The compensation consultant annually reviews the companies comprising the Custom Peer Group in order to maintain its appropriateness for the competitive pay analysis. These companies were generally selected based upon their (i) classification as “oilfield services” companies, (ii) annual revenues (the Custom Peer Group’s

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trailing twelve months (“TTM”) of revenues as of June 30, 2010 was approximately $751 million, as compared to our TTM of revenues as of June 30, 2010 of $359 million), and (iii) market capitalization. Additionally, the Compensation Committee believes that we compete for employee talent with each of these companies. Based on input from Pearl Meyers, the 2011 Custom Peer Group includes several peer companies that were not included in the 2010 Custom Peer Group (Hercules Offshore, Helix Energy Resources, Oil States International and Newpark Drilling). Additionally, Allis Chalmers was removed from the 2011 Custom Peer Group due to its acquisition. These changes reflect our continued growth and current competitors for employee talent so that the Compensation Committee can continue to evaluate the named executive officers’ pay levels versus an appropriate peer set.

Pearl Meyer developed a “market consensus” for each named executive officer’s 2011 base salary, target total cash compensation, target long-term equity incentive awards and total direct compensation by subjectively prioritizing the data derived from the Custom Peer Group and the Industry Survey Data, where appropriate, to provide representative market pricing comparisons.

The Compensation Committee uses the competitive pay information as a “market check” to ensure, in its subjective judgment, that the named executive officers’ base salary, target total cash compensation, target long-term equity incentive awards and total direct compensation remain fair and competitive. The Compensation Committee does not target any individual pay component to fall within a specific range or percentile of the competitive pay information. While the competitive pay information is important to the Compensation Committee’s approval process, it is just one of several factors considered by the Compensation Committee in approving executive compensation and the Compensation Committee has discretion in determining the nature and extent of its use.

Elements of Compensation

Base Salary

We provide the named executive officers with a base level of monthly income for the expertise, skills, knowledge and experience they offer to our management team. The Compensation Committee generally reviews each named executive officer’s base salary on an annual basis.

The named executive officers’ annual base salary as of December 31, 2010 and December 31, 2011 were as follows:

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In 2011, Mr. Locke received a 9% increase in his base salary in order to increase the competitiveness of his base salary, as this was his first increase in approximately three years, and in recognition of his contributions toward the accomplishment of the 2011 Team Goals.

In 2011, Messrs. Phillips, West, Eustace and Peña each received a merit increase in their respective base salary ranging from 3% to 5% based upon their contributions toward the accomplishment of the 2011 Team Goals.

As a “market check,” the Compensation Committee also reviewed the competitive pay information in setting the named executive officers’ base salaries in 2011. Messrs. Locke’s, Phillips’s, Eustace’s and Peña’s base salary fell between the 25^th and 50^th percentiles, and Mr. West’s base salary fell slightly above the 50^th percentile of the competitive pay information.

Annual Cash Incentive Compensation

Each year, the named executive officers are eligible to earn a cash incentive award under our 2007 Incentive Plan. The annual cash incentive award is designed to motivate and reward the named executive officers for their contributions in achieving certain business goals that we believe create shareholder value.

Each named executive officer has a target annual cash incentive award opportunity expressed as a percentage of their annual base salary paid. Subject to performance, the payout of the annual cash incentive award can range from zero to two times the target award opportunity. The threshold, target and maximum opportunity levels, expressed as a percentage of each named executive officer’s respective base salary that was actually paid in 2011, are as follows:

The amount of the cash incentive award is determined by comparing our actual performance against a scorecard of specific performance measures and associated performance levels approved by the Compensation Committee each year. The results of this comparison dictate the ultimate amount of each named executive officer’s annual cash incentive award. The Compensation Committee designed the cash incentive award to reward exceptional performance by providing for progressively increasing payments as our performance exceeds the target level, and correspondingly providing for no payment unless a threshold level of performance is achieved. If the Company’s performance falls between the threshold, target or above expectation performance levels, the cash incentive award opportunity is linearly interpolated to determine the actual payout.

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Accordingly, in February 2011, the Compensation Committee reviewed and approved the following performance measures and associated performance levels for the 2011 annual cash incentive awards. These performance measures and associated performance levels were designed to be in alignment with the Company’s strategic plans and the 2011 budget (which was approved by the Board).

In order to align the Company’s performance and the named executive officers’ performance with the interests of our shareholders, the Compensation Committee subjectively weighted each of the above performance measures relative to its potential impact on the Company’s performance and creation of shareholder value. In establishing the performance goals for Messrs. West and Eustace, the Compensation Committee included both Company-wide and divisional-wide performance goals to provide them incentives to drive the operational results of the respective division they oversee, while ensuring their overall accountability to corporate performance. Accordingly, each named executive officer’s annual cash incentive award is derived from our actual performance with respect to the measures above, on a weighted basis.

The weighting of the performance measures for the named executive officers’ target annual cash incentive award for 2011 was as follows:

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In assessing individual performance, the Compensation Committee considered the named executive officers’ achievement, as a team, of the 2011 Team Goals discussed previously.

At the end of 2011, the Compensation Committee completed the evaluation of our results and the weighing of the performance measures to ensure that the cash incentive award determinations were appropriate and aligned with pay-for-performance principles. The Compensation Committee made the following annual cash incentive award determinations for our named executive officers for 2011:

The named executive officers’ 2011 cash incentive awards are reported in the “Non-Equity Incentive Plan Compensation” column of the 2011 Summary Compensation Table below.

Long-Term Equity Incentive Compensation

For 2010 and 2011, the Compensation Committee granted each of the named executive officers time-vested stock options and performance-based RSU awards under our 2007 Incentive Plan. These awards are intended to instill a sense of ownership in our named executive officers, incentivize them to have a long-term focus of our business, and reward them for their successful efforts.

Stock Options and Performance-Based RSU Awards

In formulating the target value of each named executive officer’s 2011 long-term equity awards, the Compensation Committee conducted an assessment of the competitive pay information to subjectively develop a competitive aggregate grant date fair value for such awards. The Compensation Committee then converted the competitive aggregate grant date fair value into shares of our common stock (the “Target Shares”) by using a representative “stock price” for our common stock. The Compensation Committee determined the representative “stock price” by using the average of the closing prices of our common stock from December 31, 2010 to January 21, 2011, which was $8.54 per share. The Compensation Committee then allocated the Target Shares among stock options and performance-based RSU awards using an approximate 70% and 30% split, respectively.

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In 2011, the Compensation Committee granted the named executive officers the following stock options and target performance-based RSU awards:

The number of performance-based RSU awards set forth in the above table reflects the target number of RSU awards to be earned by each named executive officer following a three-year performance period (January 1, 2011 to December 31, 2013). The actual number of RSU awards that each named executive officer may earn, which may be greater or less than his respective target number, will be based on the average of our relative EBITDA growth, EBITDA return on capital employed (“EBITDA ROCE”), and total shareholder return (“TSR”) growth versus a defined group of eight peer companies (the “Special Peer Group”) over the three-year performance period.

Accordingly, the actual number of RSU awards that each named executive officer may earn at the end of the three-year performance period may vary from zero to 200% of his respective target amount, as shown in the following table:

Following the three-year performance period, the Compensation Committee will compare our performance in each of the three performance measures (i.e., EBITDA growth, EBITDA ROCE, and TSR growth) relative to the performance of the Special Peer Group, and assign the applicable earning percentage (i.e., 0% to 200%) to each such performance measure. Each named executive officer’s final RSU award is equal to the product of (i) the average of the three earning percentages and (ii) his respective target number of RSU awards.

Following the end of the three-year performance period, the Compensation Committee will approve the final RSU awards that each named executive officer earned and such RSU awards will then convert to restricted stock, for which the restricted stock will cliff vest in April 2013.

The Special Peer Group consisted of Nabors Industries, Helmerich & Payne, Patterson-UTI Energy, Union Drilling, Parker Drilling, Superior Energy Services, Key Energy Services, and Basic Energy Services, all of which we compete with for business on a daily basis. Because the Special Peer Group are direct business competitors, the Compensation Committee subjectively determined that these companies provide a better comparison for EBITDA growth, EBITDA ROCE and TSR growth than the Custom Peer Group, which consists of a broader group of companies with which we compete for employee talent.

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The aggregate grant date fair value of the named executive officer’s stock options and target performance-based RSU awards are reported in the “Option Awards” column and “Stock Awards” column, respectively, of the 2011 Summary Compensation table below.

We do not have a program, plan or practice to time our long-term equity incentive awards in coordination with the release of material, non-public information. In the event that material non-public information becomes known to the Compensation Committee prior to granting long-term equity incentive awards, the Compensation Committee will take the existence of such information under advisement and make an assessment in its business judgment whether to delay the grant of the long-term equity incentive award in order to avoid any impropriety.

2009 Long-Term Cash Incentive Award

In 2009, the Compensation Committee granted a one-time, long-term cash incentive award (the “2009 Long-Term Cash Incentive Award”) to the named executive officers under the 2007 Incentive Plan. Because the 2009 long-term cash incentive award was granted during the 2009 fiscal year, the Company considers it part of 2009 compensation. However, we are including a description of the 2009 Long-Term Cash Incentive Award below because part of the time-based portion of the 2009 Long-Term Incentive Award was earned in 2011 and is reported in the “Bonus” column of the 2011 Summary Compensation Table. The Compensation Committee did not grant long-term cash incentive awards to the named executive officers in 2010 or 2011.

The 2009 Long-Term Cash Incentive Award was composed of two components; the first component was performance-based and the second component was time-based.

Each named executive officer fully earned his respective performance-based component of the award as of December 31, 2010 which was reported in the “Non-Equity Incentive Plan Compensation” column of the 2010 Summary Compensation Table in last year’s proxy statement.

Under the time-based component of the 2009 Long-Term Cash Incentive Award, each of the named executive officers was eligible to earn an aggregate cash payout, with 50% of the cash payout being paid in April 2011 and with the remaining 50% of the cash payout being paid in April 2012, assuming the named executive officer continues employment with the Company through the payment date. Each named executive officer earned 50% of his respective time-based component of the award in April 2011, which is reported in the “Bonus” column of the 2011 Summary Compensation Table.

The following table further describes the performance-based and time-based components of the 2009 Long-Term Cash Incentive Award:

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2011 Total Direct Compensation

Based upon the most recent competitive pay information received from Pearl Meyer, the Compensation Committee believes that our 2011 executive compensation program provided target total direct compensation (i.e., base salary, target total cash compensation and target long-term equity incentive awards) that was reasonable and competitive but not excessive, as the following table illustrates.

Additional Information

Health, Welfare and Retirement Benefits

We offer a standard range of health and welfare benefits to substantially all of our U.S. employees, including the named executive officers. These benefits include medical, prescription drug and dental coverage, life and accidental death and dismemberment insurance, vacation, sick leave and other paid holidays. In addition, long-term disability insurance benefits and optional short-term coverage is available to all of our employees. These benefits are intended to aid in the health and well-being of our employees, as well as contribute directly to a productive and successful work life, which we believe will enhance the financial results for us and our shareholders.

We also offer all of our U.S. employees the opportunity to participate in our defined contribution 401(k) plan. Under the plan, we make matching contributions equal to 50% of the participant’s contributions on the first 6% of compensation deferred under the plan. Under this matching scheme, employees become fully vested in our matching contributions after five years of employment. The 2011 Summary Compensation Table reflects our contributions to the 401(k) plan for each named executive officer in 2011.

Perquisites

We provide a limited number of perquisites to the named executive officers, including a car allowance, payment of life insurance premiums and Petroleum Club dues. The life insurance policy pays the beneficiary an amount equal to the applicable named executive officer’s annual salary up to a maximum of $300,000.

Effective December 31, 2010, the Compensation Committee adopted a policy prohibiting the payment of country club memberships for any of the named executive officers.

The All Other Compensation column of the 2011 Summary Compensation Table shows the value of perquisites we provided to the named executive officers in 2011.

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Stock Ownership Guidelines

In order to strengthen the alignment of the interests of the name executive officers and shareholders and to increase visibility of the named executive officers’ stock ownership, we adopted the following stock ownership guidelines:

The ownership target must be obtained no later than the December 31 following the fifth anniversary of the officer’s commencement of employment with the Company, or by December 31, 2013 for any officer employed as of May 17, 2008. For purposes of the above calculation, unvested restricted stock and RSUs may be counted toward the applicable ownership requirement.

As of March 15, 2012, Messrs. Locke, Phillips and West have fully met their stock ownership requirements. Messrs. Eustace and Peña have until December 31, 2013 to meet their ownership targets.

Compliance With Internal Revenue Code Section 162(m)

Section 162(m) of the Internal Revenue Code of 1986, as amended, limits the tax deduction for annual compensation paid to a public company’s Chief Executive Officer and its next three most highly compensated executive officers, excluding the Chief Financial Officer, to $1,000,000. Qualified performance-based compensation is excluded from this deduction limitation if certain requirements are met. The Compensation Committee’s intent is to design compensation awards that will be deductible without limitation where doing so will further the purposes of our executive compensation program. The Compensation Committee will, however, take into consideration the various other factors described in this Compensation Discussion and Analysis, together with Section 162(m) considerations in making executive compensation decisions and could, in certain circumstances, approve and authorize compensation that is not fully tax deductible.

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REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis included in this proxy statement with the management of Pioneer Drilling Company, and, based on such review and discussions, the Compensation Committee recommended to the board of directors of Pioneer Drilling Company that the Compensation Discussion and Analysis be included in this proxy statement.

The Compensation Committee

Dean A. Burkhardt

John Michael Rauh

C. John Thompson

Scott D. Urban, Chairman

The information above in the Report of the Compensation Committee shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C or to the liabilities of Section 18 of the Exchange Act, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except to the extent that the Company specifically requests that the information be treated as soliciting material or specifically incorporates the information by reference.

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EXECUTIVE COMPENSATION

2011 Summary Compensation Table

The following table presents information concerning compensation for all services rendered to us in all capacities during the fiscal years ended December 31, 2011, 2010, and 2009, by our named executive officers.

The grant date fair value of the performance-based RSU awards granted during 2011, assuming the highest level of performance conditions will be achieved would be as follows:

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For 2010, these amounts reflect the aggregate grant date fair value of the performance-based RSU awards granted to the named executive officers during 2010, based on the actual outcome of the Company’s achievement of the performance conditions, and is consistent with the estimate of aggregate compensation cost to be recognized over the service period determined as of the grant date under ASC Topic 718,Stock Compensation, except that no assumption for forfeitures was included.

For 2009, these amounts reflect the aggregate grant date fair value of the restricted stock awards granted to the named executive officers in 2009, computed in accordance with ASC Topic 718,Stock Compensation, except that no assumptions for forfeitures was included.

For a discussion of valuation assumptions, see Note 8 to our consolidated financial statements included in our annual report on Form 10-K for the fiscal year ended December 31, 2011. Please see the “2011 Grants of Plan-Based Awards Table” for further information regarding the long-term incentive compensation we granted during 2011.

2011 Grants of Plan-Based Awards

The following table summarizes information concerning plan-based awards to the named executive officers during the fiscal year ended December 31, 2011:

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For the stock options, these amounts reflect the aggregate grant date fair value of the stock options computed in accordance with ASC Topic 718,Stock Compensation, except that no assumptions for forfeitures were included.

For a discussion of valuation assumptions, see Note 8 to our consolidated financial statements included in our annual report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on February 21, 2012.

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2011 Outstanding Equity Awards at Fiscal Year End

The following table provides information concerning stock options, restricted stock and unearned RSUs held by the named executive officers which were outstanding as of December 31, 2011.

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2011 Option Exercises and Stock Vested

The following table provides additional information about stock option exercises and shares acquired upon the vesting of stock awards, including the value realized, during 2011, by the named executive officers.