Five rigs come online
Drilling activity increased this week, breaking a three-week slide, according to the latest edition of Baker Hughes Weekly Rig Count.
A net five rigs came online this week, cancelling out the five that shut down last week. All five rigs are land-based, meaning there are now 1,029 land, four inland waters and 19 offshore rigs active in the country, for a total of 1,052 rigs operational.
Operations continue to concentrate on drilling for oil, as five oil-targeting rigs began drilling this week. Gas and miscellaneous rigs were unchanged, so there are now 863 oil, 187 gas and two miscellaneous rigs drilling in the country. The proportion of oil drilling continues to approach all-time highs, as 82% of modern rigs are drilling for oil. This is exceeded by only 36 weeks in the past 31 years, and is the highest proportion since August 2016.
Drilling activity continued to shift toward horizontal activity and away from vertical drilling this week. Four horizontal rigs began drilling in the past week, while two directional rigs came online and one vertical rig shut down. This means there are 67 directional, 930 horizontal and 55 vertical rigs active in the U.S.
New Mexico rig count approaching all-time highs
Rigs shuffled extensively in individual states, and many states saw a change in rig count. New Mexico saw the largest increase in activity, with four rigs coming online. With 99 rigs currently active, New Mexico is very close to the highs set before the downturn. The all-time high for drilling activity in the state is 103 rigs, set in October 2014. If the Permian continues to increase in importance, New Mexico will likely exceed this level soon. Almost all activity in the state comes from the Permian, as only three rigs are targeting other basins.
Other states that saw increases were North Dakota, which added three rigs, Louisiana, where two rigs came online, and Alabama, Indiana, Mississippi and Oklahoma each added one. One rig shut down in Colorado, two came offline in Alaska and Utah, while four stopped drilling in Texas.
Most new rigs targeted small basins not tracked individually by Baker, as nine began drilling in these “other basins.” This reverses the trend seen since activity bottomed out in 2016. About 28% of all rigs in the U.S. were targeting minor basins in early 2016. This proportion has since fallen to about 17%, as operations concentrate in the Permian and other major basins.
The only major basin to see a significant increase in activity this week was the Williston, where three rigs began drilling. One rig also came online in the Eagle Ford and Permian, while one shut down in the Ardmore Woodford, DJ-Niobrara and Haynesville. The Cana Woodford saw a major drop in activity, with six rigs coming offline this week.
