A new report from the EIA shows increased productivity per rig
Reports from Baker Hughes (ticker: BHI) last week showed the number of rigs actively drilling for oil and gas in the United States fell below 1,000 for the first time since September 2009. Even as the number of rigs drilling has dropped precipitously in the U.S. as oil prices remain depressed, a new report from the Energy Information Administration (EIA) shows that productivity per rig is up. The EIA’s Drilling Production Report (DPR) is a monthly report with projections of the next month’s production by region.
Across the board, production from an average rig in each of the regions tracked in the EIA’s monthly DPR increased, with the exception of oil rigs in the Marcellus which showed no change. On average, the monthly additions from one average rig were 12 BOEPD, with the largest increases expected in the Permian and Eagle Ford.
The monthly additions from one average gas rig across the seven regions in the DPR are expected to go up by an average of 51 Mcf/d month-over-month. The EIA predicts the largest increase in average production for gas rigs will be in the Utica where the average rig is expected to produce an additional 132 Mcf/d of gas.
Despite the increased efficiencies seen from individual rigs, the fall in absolute numbers will still lead to lower overall production, according to the DPR. On average, month-over-month oil production is expected to fall 8 MBOPD while overall natural gas production is projected to fall about 3 Mcf/d.
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