Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Oil

US oil and gas rig count falls, Permian takes biggest hit: Enverus DrillingInfo

Oil | Crude Oil | Refined Products

Will Citgo’s US refineries be seized by creditors?

Oil

Platts Market Data – Oil

NGL | Oil | Crude Oil | LPG | Oil Risk | Petrochemicals

Platts University New York

Oil | Crude Oil | Shipping | Tankers

USGC-China VLCC freight tumbles 40% after spike

US oil and gas rig count falls, Permian takes biggest hit: Enverus DrillingInfo

Houston — Permian sees lowest rigs count since January 2018

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Most of weekly decline was oil rigs, down 16 to 767

Continued rig conservatism by E&P presenters at Barclays

The US oil and gas rig count fell 21 to 966 on the week, according to Enverus DrillingInfo data released Thursday, with Permian Basin rigs taking by far the biggest hit.

Permian rigs in the West Texas/New Mexico basin were down 15 in the past week, leaving 418. That is the lowest number since the first week of 2018.

Overall, most of the week's rig count decline was in oil-oriented rigs, which were down 16 to 767, Enverus said. Gas rigs dropped by 8 to 191, while there was a three-rig gain in rigs not classified as either oil or gas.

Of the other seven major named US basins, the Dry Marcellus, largely in Pennsylvania, was down by three to 26 rigs.

Two basins lost a rig each: The Denver-Julesburg Basin, mostly in Colorado, is now at 26 rigs, while the SCOOP-STACK play in Oklahoma is at 65.

But the Williston Basin in North Dakota and Montana, which encompasses the Bakken Shale, gained a rig for a total 59.

Four other basins remained the same week on week: the Eagle Ford Shale of South Texas stayed at 73, the Haynesville Shale of East Texas and northwest Louisiana remained at 52, the Wet Marcellus, also mostly in Pennsylvania, kept to 19 rigs and the Utica Shale, largely in Ohio, held steady with 16 rigs.

PERMIT APPROVALS DOWN BY 198 TO 790

Permit approvals this week were down by 198 compared to last week, for total US approvals of 790. Permitting was down in virtually all basins; the largest single move was in the DJ Basin, down 243 to zero this week.

In other basins, the Wet Marcellus was down 22 to 9, the Permian was down 21 to 106, the Eagle Ford was down 19 to 26, and the Williston was down 17 to 10. All other named basins were down by 11 or less, except in the Utica Shale, which recorded a five-permit gain for a total of 6.

This week, a key analyst conference provided more evidence that E&P operators are continuing their disciplined approach to upstream activity for the rest of the year.

Upstream presenters at the Barclays CEO-Energy Power Conference in New York said they were sticking to capital budgets stated earlier in 2019, and gave figures showing return on capital employed, excess cash flow generated and other metrics to demonstrate they were living well within their means.

For example, Permian producer Pioneer Natural Resources is running an average 21 to 23 rigs this year in that play, and company CEO Scott Sheffield said Pioneer wants to build cash on its balance sheet long-term "so we can drill through the cycles" and not fluctuate wildly in rig counts.

Pioneer's 10-year plan calls for adding two to three rigs per year, but the company will not add more in response to any oil price run-up should that occur. If prices drop and stay there, the company may reevaluate so as not to harm its balance sheet, Sheffield said. But if WTI prices should rise to $70/b, Pioneer will "not add a single rig."

DOING MORE WITH EXISTING RIGS

As far as possible, companies said they continue to find ways to do more with the equipment they already have in the field.

Jeff Gustavson, vice president of Chevron's North American E&P Midcontinent Business Unit, said the major is running 20 Permian Basin rigs, and has planned to stay there for awhile. On Wednesday, Gustavson said that even if oil prices should rise, "what we're really focused on right now is making those 20 rigs ... operate as if they're 24 rigs or 28 rigs."

E&P companies have also learned to eke efficiencies from existing rigs. Brad Holly, CEO of Bakken Shale producer Whiting Petroleum, said last year some operators in that play had "kind of stagnated" in their ability to drill a 20,000 foot well -10,000 feet vertically and 10,000 feet horizontally - in 10 days.

But Holly wanted to break the mold, and did so. In Q2 the company saw its four Bakken rigs average 7.3 days of drilling per well. Also, in 2018 it averaged about six stages, or intervals along a horizontal well leg, per day which was nearly double its previously typical stage count in some cases.

To achieve that, Holly claimed Whiting "partners" or works differently with service contractors "to optimize and be willing to try new things."

That means "we've been able to almost double the amount of stages that we get in any given day," he said. "This essentially cuts the [well] completion time in half and significantly saves on cost."

Whiting's four Bakken rigs are all in the top 10 Williston Basin rigs for footage drilled per day, which "certainly gives Whiting a competitive advantage," he added.

-- Starr Spencer, starr.spencer@spglobal.com

-- Edited by Gary Gentile, newsdesk@spglobal.com