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Drilling Forecast Brightens - A Bit
With natural gas prices expected to slowly climb next year, there is a glimmer of hope in the latest oil and gas well drilling forecast.
"It`s still pretty marginal, with the active drilling rig count increasing by four per cent next year and most of the increase coming in the second half of 2010," Nancy Malone, manager of economic analysis for the Canadian Association of Oilwell Drilling Contractors (CAODC), said Wednesday.
This year, the industry was hammered as low gas prices forced a curtailment of drilling. The 209 rigs drilling a projected 8,278 wells in 2009 represent a fleet utilization rate of just 24 per cent. That rate is expected to climb to 27 per cent in 2010.
By comparison in 2008, 351 rigs drilled 16,844 wells for an average utilization rate of 40 per cent. And in 2007, 336 rigs drilled 19,144 wells for a utilization rate of 38 per cent.
The rig fleet, which peaked at 902 in 2007, is now 840 and expected to average 800 next year.
The CAODC forecast is based on oil at $70 US a barrel, and gas at $5.50 Cdn per million cubic feet-- $1 more than the current price. But gas futures are trading at $5.50 for the second half of 2010.
Read the full article here.
With natural gas prices expected to slowly climb next year, there is a glimmer of hope in the latest oil and gas well drilling forecast.
"It`s still pretty marginal, with the active drilling rig count increasing by four per cent next year and most of the increase coming in the second half of 2010," Nancy Malone, manager of economic analysis for the Canadian Association of Oilwell Drilling Contractors (CAODC), said Wednesday.
This year, the industry was hammered as low gas prices forced a curtailment of drilling. The 209 rigs drilling a projected 8,278 wells in 2009 represent a fleet utilization rate of just 24 per cent. That rate is expected to climb to 27 per cent in 2010.
By comparison in 2008, 351 rigs drilled 16,844 wells for an average utilization rate of 40 per cent. And in 2007, 336 rigs drilled 19,144 wells for a utilization rate of 38 per cent.
The rig fleet, which peaked at 902 in 2007, is now 840 and expected to average 800 next year.
The CAODC forecast is based on oil at $70 US a barrel, and gas at $5.50 Cdn per million cubic feet-- $1 more than the current price. But gas futures are trading at $5.50 for the second half of 2010.
Read the full article here.