A total of 13,350 wells are expected to be drilled across Canada in 2012, 1,750 (11.6%) fewer than previously forecast but still 4% more than the 12,917 wells drilled in 2011, according to the Petroleum Services Association of Canada (PSAC).

PSAC said it was updating its 2012 Canadian Drilling Activity Forecast to reflect continuing low natural gas prices and an ongoing shortage of skilled labor in the nation’s oil fields. The Calgary-based trade association said it based its latest forecast on average prices of C$3.25/Mcf for natural gas and US$90/bbl for crude oil.

“While PSAC’s current forecast may be well short of the 20,000-plus well counts we were forecasting only a few years ago, the complexity and depth of current wells will keep our industry well ahead of meeting the increasing demand for oil,” said PSAC CEO Mark Salkeld.

PSAC estimates that 8,267 wells will be drilled in Alberta in 2012, a 2% increase from 2011 drilling levels. British Columbia is expected to drill 640 wells this year (up 3%); Saskatchewan 3,739 wells (up 6%) and Manitoba 665 wells (up 14%).

In early November the PSAC forecast a total of 15,100 wells would be drilled in Canada this year and the Canadian Association of Oilwell Drilling Contractors (CAODC) said it expected strong oil commodity prices to help the drilling rig fleet grow significantly, despite a skilled manpower shortage. “Industry suffered a great loss of skills and knowledge during the downturn of 2009 and it has struggled to attract these experienced workers back,” CAODC said at the time.

Last month PSAC said about four-fifths of Western Canadian field activity in 2012 will tap oil embedded in dense rock with horizontal wells and hydraulic fracturing (see Daily GPI, Dec. 27, 2011).

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