BHI: Oil rigs lift overall US rig count by 10
Entirely comprising oil-directed units, the US drilling rig count increased by 10 during the week ended Aug. 19, according to data from Baker Hughes Inc.
Now at 491 rigs working, the overall count has risen in 10 of the last 12 weeks, adding 87 units during that time. Compared with Dec. 5, 2014, the week prior to the drilling freefall, the count is down 1,429 units.
Largely bolstered by increased oil-directed drilling activity in the Permian basin, last week’s overall 17-unit rise in the US was the country’s largest since July 24, 2015 (OGJ Online, Aug. 12, 2016). The basin has represented more than two thirds of the total US gain during the recent rally.
Meanwhile, US crude oil production during the week ended Aug. 12 jumped 152,000 b/d to 8.597 million b/d, down 751,000 b/d year-over-year, according to data from the US Energy Information Administration. The Lower 48 accounted for 100,000 b/d while Alaska contributed the remaining 52,000 b/d.
EIA also this week forecast a 3,000-b/d increase in output from the Permian during September after several months of declines (OGJ Online, Aug. 15, 2016). Overall US shale oil output, however, is expected to fall 85,000 b/d during the month.
The projected rise in the Permian comes as firms have been snatching up acreage and adding rigs in the Midland and Delaware basins (OGJ Online, Aug. 5, 2016). Over the past 3 months, Callon Petroleum Co., Pioneer Natural Resources Co., QEP Resources Inc., Laredo Petroleum Inc., SM Energy Co., Concho Resources Inc., and Parsley Energy Inc. have all moved to expand their positions in the Midland basin alone.
Among those planning to maintain higher rig counts during the second half in the Midland basin are Pioneer, QEP, Concho, and Apache Corp. Doing the same in the Delaware basin are Concho, Devon Energy Corp., WPX Energy Inc., and Anadarko Petroleum Corp.
West Texas horizontal wells
With another double-digit increase this week, US oil-directed rigs have added 90 units since May 27 to reach 406, which is down 1,203 units since their peak in BHI data on Oct. 10, 2014.
All but 1 of the 10 oil-directed units began operations on land, bringing that tally to 470. Rigs engaged in horizontal drilling counted 7 more units to 382, up 68 units since May 27. Directional drilling rigs edged up 1 unit to 45. One unit started work offshore Louisiana, lifting the overall US count to 18.
Texas paced the major oil- and gas-producing states, gaining 8 units this week to 238, up 64 units since May 27. As with last week’s 13-unit jump, all but 1 of the units to begin work this week were in the Permian. At 196 rigs working, the basin is up 59 units since May 27.
The last time the Permian recorded an increase as big as last week’s was Mar. 7, 2014. The basin peaked at 568 rigs working during October-November 2014 before plunging to a bottom of 134 in this past April-May.
Pennsylvania posted the only other double-digit increase, rising 2 units to 17. The Marcellus jumped 3 units to 24. Oklahoma, Louisiana, and West Virginia each edged up 1 unit to 62, 43, and 8, respectively. The Cana Woodford rose 3 units to 32, while the Mississippian dropped a unit to 3.
New Mexico dropped a unit to 30, ending its recent warm streak at 6 weeks. Down 2 units to 27, North Dakota led the way in losses, mirroring the same tallies of the Williston.
Canada recorded its first rig-count decline in 11 weeks, relinquishing 5 units during the week to settle at 121, still up 85 compared with the week ended May 6. Oil-directed rigs, however, remained flat at 65. Gas-directed rigs lost 4 to 56 while the country’s only unclassified rig went offline.
Contact Matt Zborowski at firstname.lastname@example.org.