First time below 1,000 since March 2018

By Richard Rostad, analyst, Oil & Gas 360

Drilling activity fell sharply today continuing the overall downward trend according to Baker Hughes’ Weekly Rig Count.

A net 21 rigs shut down in the week, the largest decline since mid-January. This week’s drop has pushed the U.S. rig count below 1,000 rigs, the first time below this milestone in over a year. Twenty land-based and two offshore rigs shut down in the week, while one inland waters rig shut down. There are now 966 land, four inland waters and 21 offshore rigs active in the country, for a national total of 991.

The nationwide rig count is down 92 so far this year, after reaching a post-downturn peak of 1,083 in the last week of 2018

This week’s activity shift affected mostly oil-targeting rigs, as 20 such rigs came offline in the week. Only one gas-targeting rig shut down, meaning there are currently 805 oil and 186 gas rigs actively drilling.

Vertical activity at all-time low

All trajectories saw activity decline this week, with four directional and vertical rigs and 13 horizontal rigs shutting down. There are only 47 vertical rigs currently active in the U.S., approaching the multi-decade low of 45 vertical rigs seen in mid-2016. Vertical drilling currently accounts for only 4.7% of activity, an all-time low.

Many states saw some change in rig count, with Texas showing the largest shift with nine rigs coming offline. Three rigs shut down in North Dakota, while two came offline in Wyoming and one stopped drilling in Alaska, California, Indiana, Kansas, Louisiana, New Mexico, Pennsylvania and Virginia. Only Colorado saw an increase in drilling, with one rig coming online.

The sharp decline in Texas drilling naturally impacted the two most popular basins, as four rigs shut down in the Eagle Ford and three stopped drilling in the Permian. Declines were also seen in the Williston, where three rigs came offline, the Cana Woodford, which lost two, and the Granite Wash and Utica, where one rig shut down. The Mississippian was the only major basin to add rigs in the week, with two starting operations.

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