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U.S. Rig Count Continues Upward Trend, with Assist From Powder River Basin

The U.S. rig count increased again in the three-day week prior to Thanksgiving, with growing strength in the Powder River Basin (PRB), according to data from Baker Hughes Inc. (BHI) and NGI's Shale Daily.

As of Wednesday (Nov. 22), the United States added eight total rigs -- nine additional oil rigs, compared with a one-rig decline in the natural gas sector -- to end the week at 923 active rigs, versus 593 running a year ago. It was the third consecutive week the domestic rig count has increased, following an extended period of retrenchment beginning in the summer. The U.S. count reached a peak of 958 active rigs on July 28 before falling to a recent low of 898 on Nov. 3.

A single Gulf of Mexico rig was added during the three-day period, with seven more added in the onshore. Ten horizontal units were added, as were three vertical, while five directional units were lost, according to BHI. At the same time, Canada added seven rigs for a total of 215, compared with 174 at the same time last year.

The combined North American rig count stands at 1,138, up 15 week/week and an increase of 361 year/year.

The Permian Basin saw a two-rig increase to 393, with a seven-rig jump in the Midland sub-basin more than making up for a three-rig decline in the Delaware sub-basin and two more rigs down in other parts of the Permian. The Denver-Julesburg/Niobrara play added one rig, and one rig was lost in the Cana Woodford, BHI said.

The PRB was also a big gainer, adding six rigs, according to NGI's Shale Daily data, with the Green River and Uinta basins each losing a single rig to end at 12 and 10, respectively.

Oil production from the Permian increased by 60,800 b/d from September to October, with total production at slightly under 2.6 million b/d, according to the Federal Reserve Bank of Dallas. And the tally of drilled but uncompleted wells (DUC) is expanding at a swift pace. The Permian DUC count to date in November, more than doubled since October 2016, most recently stood at 2,533.

Among states, Wyoming added four rigs for the week, reaching a total of 25. Colorado, Louisiana, Montana, New Mexico and Texas each saw an increase of one rig week/week, BHI said.

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