By OGJ editors
HOUSTON, Apr. 5 -- US land drillers and related services increasingly are benefiting from strengthening oil and natural gas prices, Raymond James & Associates Inc. reported.
Overall US drilling activity has risen by 313 rigs since Jan. 1, 2003, and the US land rig count is up by 334 during that same time, offset by losses in other categories, according to Baker Hughes Inc. statistics.
The increased land drilling rates were not apparent until recently because land rig utilization never reached the point that would driving meaningful price increases and because land rig activity by some of the larger oil companies stagnated in mid-2003. For example, both Anadarko Petroleum Corp. and El Paso Corp. reconfigured their drilling plans.
"Over the past several months; however, both of these negative issues have started to disappear. On the pricing front, utilization of land rigs, [fracturing] fleets, wireline units, tube mills, etc. have now reached the point at which the industry is starting to see meaningful price increases," said J. Marshall Adkins in the Houston office of the St. Petersburg, Fla.-based RJA.
Unlike last summer, both major and independent operators are contributing to the steady rig count climb, he said, adding that the majors are maintaining a "fairly consistent and improving market share."
RJA forecast a gradual US land day rate increase of $200-300 per day per quarter in 2004 compared with day rate increases of more than $1,000 per day per quarter for several consecutive quarters in 2000-01.