Canada added eight natural gas-directed rigs to its census and dropped four oil rigs in the latest tally of active rigs compiled by Baker Hughes Inc. and released on Thursday, one day early because of the U.S. holiday. In the land where Independence Day is celebrated, drillers had more of a taste for oil, adding 12 oil-directed rigs and dropping nine gas rigs for the week ending July 2.
Overall the North American rig count stepped up by seven, which was enough to push the census to 1,001 for the continent.
In the United States, a net of three rigs returned to action with four returning to land operations and two leaving inland waters; one rig was added in the offshore.
The Eagle Ford Shale and the Williston Basin each added three rigs. But giving up one each were the Ardmore Woodford, Denver-Julesburg/Niobrara, Fayetteville and Marcellus shales, and the Mississippian Lime. The Granite Wash, Permian Basin and Utica Shale each added a rig, as did the Barnett Shale and Cana Woodford.
Analysts at Barclays Commodities Research pointed out gas production declines in a recent note, but they added that declines won't be sticking around, thanks to the Marcellus.
"Initial pipeline scrapes indicate production is falling off in the associated gas plays in Texas, along with offshore Gulf of Mexico, but production in the Marcellus is still poised to grow strongly once maintenance and new capacity is complete," they said. "Although the bulk of the increase will come online in Q4 '15, production will also increase in July with the start up of the 1.2 Bcf/d REX [Rockies Express] East-West Pipeline. Production from the Northeast should help to keep production levels largely static at around 72 Bcf/d through the fall, despite declines in other regions."