The US oil and gas rig count shed one rig in the week ended March 23, leaving 780, energy analytics and software company Enverus said March 24, with the Eagle Ford Shale now at its highest level since March 2020.
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The week ended March 23 was also the first time the total domestic rig count recorded a loss since the end of 2021. So far in 2022, the rig count is up 73 rigs.
Still, oil rigs gained three rigs to 609, while rigs chasing gas dropped by four to 171.
Most basins moved little in either direction, while three basins did not change at all.
The Eagle Ford, located in South Texas moved up the most, as the former gained two rigs to 68. The SCOOP-STACK in Oklahoma and the Permian Basin of West Texas/New Mexico dropped the most at two each. That left the Permian with 328 and the SCOOP-STACK with 42.
Otherwise, the Williston Basin mostly in North Dakota/Montana, and the Marcellus Shale, mostly in Pennsylvania and West Virginia, moved by one each but in different directions. The Williston was up one rig to 35, while the Marcellus lost a rig for a total of 40.
Three basins -- the Haynesville Shale of East Texas/Northwest Louisiana, the DJ Basin mostly in Colorado and the Utica Shale largely in Ohio -- stood still rig-wise. That left the Haynesville at 71, the DJ at 18 and the Utica at 14.
The week ended March 23 is the fourth consecutive week Haynesville has been at 71 rigs. It reached 73 the week ended February 23 and was again at 71 the week before that. Previously, Haynesville drilling activity had not been in the 70s for at least three years.
So far in March, the rig count has gained 20 rigs and another 19 rigs in February, but added 34 in January. Many analysts had expected the gains to slow but the level of growth so far in 2022 has been brisk.
But, as Evercore ISI analyst James West notes, upstream operators' strict capital discipline, coupled with labor, equipment and materials shortages, make a North American "accelerated oil supply response [to any potential global shortages] ... unlikely."
"We believe that the bottleneck for further US production growth will be the availability of frac [hydraulic fracking] fleets," West said. "US frac utilization is quickly approaching 90%. We believe there are approximately 240-250 frac spreads deployed in the market out of a potential 265 that the industry can potentially deploy."
For the week ended March 18, the Primary Vision US frac count stood at 266. By contrast, the pre-coronavirus pandemic frac count was 324.
"US completion activity is having its seasonal dip in March, which will start to shift higher as we approach April, Mark Rossano, energy analyst for Primary Vision, said.
"The spring is a period of accelerating activity that will carry us through the summer until we start to see a slowdown in September/October," Rossano said in his most recent Primary Vision blog post March 18.
"We have seen activity remain strong in the Anadarko [Basin of Oklahoma] while the Haynesville has slowed down a bit, which is 100% normal for this time of year."