The race back to the oil/gas patch by U.S. drilling rigs took a pause, according to Baker Hughes Inc. (BHI). And the shale gale has gotten a bit winded due to previous rig declines, according to an analyst.
Only one U.S. rig returned to service in the inland waters, and there were no returns in the offshore or land categories.
Three U.S. oil rigs returned to action, but two gas-directed rigs left. Four directional units returned, offset by the departure of three horizontals. With the U.S. count only up by one to 463 (440 on land), it was left to Canada to bring the excitement to the latest count of active drilling rigs by Baker Hughes Inc., which was released Friday (July 29).
With spring breakup season in the rearview mirror, Canada added 17 rigs to end the week at 119 running. Alberta gained 12 rigs to end at 79. British Columbia added three units to make 13 running. Saskatchewan lost a rig to end at 21. And Manitoba gained three units, up from zero.
North America ended the week with 582 actives. Twelve Canadian oil rigs came back, joined by five gas-directed units.
In a Friday note, Societe Generale Commodities Research analyst Breanne Dougherty wrote that natural gas production is not likely a bearish or bullish risk to fundamentals through the "denouement" of the storage injection season.
Since mid-May, domestic gas production has averaged 70.6 Bcf/d, with a daily range of 69.4-71.3 Bcf/d. This marks a "tilt" from the December 2014-April 2016 monthly average of 72.2 Bcf/d, she said.
"The tilt in production that appeared in daily data mid-May is also being captured in the most recent EIA Drilling Productivity Report data," she said. "This proves that the core seven shales are being impacted, albeit slowly, by the aggressive downturn of investment/drilling that commenced in early 2015...Any slight month-to-month growth being seen in Utica is being more than offset by declines across the other core shales. Marcellus, the inarguable growth engine for gas production, is estimated to have actually peaked in February."