Rig count up 4% in the last month; oil and gas prices still increasing
The U.S. rig count rose by two in the last week. According to Enverus Rig Analytics, the count is up 4% in the last month and up 91% in the last year. Activity levels are still down nearly 200 rigs compared to this time in 2019. That was the seventh time the rig count increased in the past eight weeks.
Several of the major plays are at or near 2019 levels for this time of year, with the Anadarko Basin running only four fewer rigs than in October 2019 at 53. Appalachia is essentially flat while the Gulf Coast is off only 10% at 81. The Permian Basin is about 38% below October 2019, and the Denver-Julesburg Basin is still down more than 40%. The total count is up for a 14th month in a row for the first time since July 2017.
WTI crude futures in the U.S. rose to their highest since 2014 earlier this week and were currently trading around $83/bbl Oct. 29.
An even bigger price increase has occurred in natural gas—futures were up 115% so far this year but it has not yet encouraged drillers to drill for more gas. The oil rig count was up about 66% since the start of the year, while the number of active gas rigs was only up about 20%.
Even though producers were not drilling many new gas wells, the U.S. Energy Information Administration (EIA) projected gas output from the biggest shale basins would rise to a record high for a sixth month in a row in November—this is in part because companies were completing oil and gas wells drilled long ago, prompting some analysts to project that drilling will have to increase soon or production will decline as the number of DUCs falls.
The EIA said producers completed 876 oil and gas wells in the biggest shale basins in September, the most since March 2020, leaving just 5,385 DUCs, the lowest since February 2017.
It was the 15th month in a row that the number of DUCs declined, the longest streak on record, according to EIA data going back to 2014.
Trends
Recommended Reading
Sheffield: E&Ps’ Capital Starvation Not All Bad, But M&A Needs Work
2024-10-04 - Bryan Sheffield, managing partner of Formentera Partners and founder of Parsley Energy, discussed E&P capital, M&A barriers and how longer laterals could spur a “growth mode” at Hart Energy’s Energy Capital Conference.
BKV Prices IPO at $270MM Nearly Two Years After First Filing
2024-09-25 - BKV Corp. priced its common shares at $18 each after and will begin trading on Sept. 26, about two years after the Denver company first filed for an IPO.
Archrock Offers Common Stock to Help Pay for TOPS Transaction
2024-07-23 - Archrock, which agreed to buy Total Operations and Production Services (TOPS) in a cash-and-stock transaction, said it will offer 11 million shares of its common stock at $21 per share.
Cibolo Energy Closes Fund Aimed at Upstream, Midstream Growth
2024-09-10 - Cibolo Energy Management LLC closed its second fund, Cibolo Energy Partners II LP, meant to boost middle market upstream and midstream companies’ growth with development capital.
CrownRock Offloads Oxy Shares Two Weeks After Closing $12B Deal
2024-08-15 - Underwriters of the offering agreed to purchase CrownRock’s Occidental stock at $58.15 per share, which will result in approximately $1.719 billion in proceeds before expenses.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.