Efficiency up, rig count down
EnerCom has released the latest Effective Rig Count edition, examining the state of drilling activity in major shale basins.
The Effective Rig Count fell slightly in October, dropping from 2,219 to 2,212. While output per rig increased, this was outweighed by the drop in active rigs. The total number of rigs operational in major shale basins fell by 13, while the Effective Rig Count dropped by 7.
The average modern drilling rig is now yielding just under than 2.8 times more production than the average rig did in January 2014. The commodity price downturn forced operators to improve technologies, relying on efficiencies to make up for lower oil prices. The current productivity is certainly improved, but remains below the levels seen in late 2016.
Shale activity had not entered the current resurgence in late 2016, and completions were not lagging drilling. Currently, on the other hand, companies are firing on all cylinders, with extensive drilling activity. Completions activity has fallen behind, though, meaning output per rig has fallen.
EnerCom has combined the Marcellus and Utica rig counts into one category, Appalachia, as operations targeting the two formations are starting to merge, with companies targeting both in projects. The Effective Rig Count shows 171 effective rigs in Appalachia, making it the second most popular basin in the U.S. According to Baker Hughes there are 75 rigs in the basin, meaning rigs are just under 2.8 times more efficient now than in the beginning of 2014.
Production up by 210 MBOEPD in next month
The EIA predicts that the major basins will grow by almost 210 MBOEPD from November to December, split between an additional 80 MBOPD and 130 MMcf/d. Permian oil production growth will be greater than all other basins combined, adding 58 MBOPD from November to December. Natural gas growth will be dominated by Appalachia once again, with the region’s output growing by 394 MMcf/d. Notably, production in the Eagle Ford will be virtually flat, with oil output unchanged and gas production up only 5 MMcf/d. Production from the Eagle Ford has been nearly flat in the past months, as industry attention focuses on the Permian.
DUC count up by 138
The number of drilled uncompleted wells in the U.S. rose yet again, growing by 138 from September to October. There are now an estimated 7,342 DUCs in the U.S., a new record. As usual, most growth in DUC count came from the Permian, which added 103 in the month. Another 33 DUC wells came from the Eagle Ford. Of the major basins in the U.S., only two did not see DUC count increase this month. Drilling exactly matched completions in the Niobrara, which held flat at 685 drilled uncompleted wells. Completions outpaced drilling in the Bakken, where the DUC count fell by 11 this month.
