By OGJ editors
HOUSTON, Feb. 20 -- US drilling activity continued to fall, down by 39 to 1,300 rotary rigs still working this week, said Baker Hughes Inc.
That's down from 1,771 active rigs in the same period last year and the lowest rig count since the week ended Mar. 11, 2005, when 1,282 rigs were drilling. Losses cut across all categories with land operations down by 34 rigs to 1,241. Offshore drilling was down 4 rigs to 54 still working on federal offshore leases, including 53 in the Gulf of Mexico. Inland waters activity declined by 1 rig to 5.
Analysts at Barclays Capital Inc. said, "The deterioration in global jack up markets is accelerating. We believe peak-to-trough day rate declines [in excess] of 50% are likely for many rigs." They said, "Subletting activity is picking up, which is typically negative for day rates."
In the Houston office of Raymond James & Associates Inc., analysts reported, "Jack up demand remains anemic. This is particularly true in the Middle East." They jokingly warned, "Look for drilling activity to slow in the Haynesville [shale gas plays] this weekend as the Bassmaster Classic hits northwest Louisiana!" The 3-day professional bass fishing competition is scheduled Feb. 20-22, in Shreveport, La.
Of the rotary rigs still working in the US, there were 1,018 drilling for natural gas this week, 36 fewer than the previous week. Those drilling for oil were down by 4 to 269. There were 13 rigs unclassified. Horizontal drilling fell by 22 rigs to 475. Directional drilling was down 15 to 244.
Among the major producing states, Texas had the biggest loss, down 17 rigs with 564 still making hole. Louisiana was down 9 units—including 7 land rigs in the northern portion of the state—to a total 151. Oklahoma and New Mexico dropped 4 rigs each to respective counts of 130 and 46. North Dakota, Wyoming, and Arkansas were down 2 rigs each to 62, 51, and 49, respectively. Alaska lost 1 to 7, and Colorado was unchanged at 69. California reported 2 more rigs working this week for a total 24.
In other areas of interest, Utah and West Virginia both had rig counts of 25, with Utah up 3 from the previous week and West Virginia down 2. Pennsylvania was unchanged with 24 rotary rigs drilling.
Canada's rig count fell by 20 to 401, down sharply from the 647 rotary rigs that were drilling in the same period a year ago.