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Well numbers, rig counts show US oil, gas drillers galloping through 2018

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Well numbers, rig counts show US oil, gas drillers galloping through 2018

In a clear indication of a ramp-up in U.S. oil and gas drilling activity, both well completions and drilled but uncompleted wells increased in the third quarter of 2018.

In a report released Oct. 5, the American Petroleum Institute said oil well completions increased 19% in the third quarter compared to the same quarter in 2017, including an 82% spike in exploratory well completions. Total exploratory well completions increased 15% from the second quarter to the third quarter.

"[The] report reflects the record setting growth and continued strength of U.S. energy production," American Petroleum Institute Chief Economist Dean Foreman said, noting that production is increasing in the Bakken Shale and the Permian Basin.

Data from the U.S. Energy Information Administration backed up the industry group's assessment that drilling completions are up but also showed that a considerable increase in wells that are drilled but uncompleted, called DUCs.

In its latest Drilling Productivity Report, the EIA said wells drilled per month nationwide increased by 100 from May to August, from 1,420 to 1,520. But the total of uncompleted wells increased from 7,591 to 8,269.

The Permian, which is suffering from a lack of pipeline capacity, was responsible for most of the new DUCs with an increase of 587, from 3,043 to 3,630. The Eagle Ford Shale also saw a noticeable increase in uncompleted wells over the course of the third quarter, going from 1,428 in May to 1,545 in August.

According to the EIA, the number of uncompleted wells stood at 6,227 at the end of August 2017, meaning there have been more than 2,000 wells drilled but not completed over the past year.

Corresponding with the increased number of drilled wells is a greater number of rigs active in the U.S. In its weekly rig count update from Oct. 5, Baker Hughes said there were 1,052 rigs in use around the country, up from 936 a year ago. Rigs drilling for oil have increased by 113, from 748 to 861.