U.S. Running Rigs Reach Lowest Level of the Millenium
United States rig counts closed out 2015 with 698 in operation, according to the latest information provided by Baker Hughes (ticker: BHI). The total is just two less on a week-over-week basis, and both were oil-focused rigs. The updated number is the lowest since 1999.
Taking basins into consideration, the Williston lost two rigs and now has only 53 in operation – down a staggering 70% compared to year-end 2014. The Barnett, Cana Woodford and Utica each reduced their fleet by one rig, while the Haynesville added one to the field. Somewhat surprisingly, the Permian Basin added five to operations and now accounts for nearly one-third of all operating rigs in the United States.
The rig count in Canada, meanwhile, dropped to 83 after 43 were taken offline, reaching its lowest level since May 2015. Analysts like Dan McDonald of RBC Dominion Securities said the lower-than-expected activity “points to an even slower start to the Q1 winter drilling season than 2015.”
In October, analysts from Raymond James Equity Research projected rig counts would breach the 600 mark by mid-2016 – a stark difference from an August estimate that believed the number would be near 900 at year-end 2015 and be in the 800 range throughout 2016.
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