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U.S. Rig Return Stumbles as Canada Comes Roaring Back

The U.S. land-based rig return broke its stride during the week ending Friday, Jan. 13, with the count dropping by six units. Canada more than made up for U.S. losses, adding 110 rigs as crews returned from holiday break and rushed to drill more wells before the spring thaw.

The U.S. decline was spread fairly evenly across plays and states, with declines of no more than two units. Wyoming added two rigs.

Seven oil-directed rigs left U.S. play, offset in part by the return of one natural gas rig. One departure in the inland waters was offset by the return of one rig to the offshore. Eleven vertical rigs packed it in, partially offset by the return of two directionals and three horizontals.

When Baker Hughes Inc. finished its tally, there were 634 U.S. land rigs running and 25 operating in the offshore to make for a U.S. count of 659. Oil rigs numbered 522 and gas rigs 136. There was one rig in the "miscellaneous" category. Fifty-nine directionals, 537 horizontals and 63 vertical rigs comprised the operating U.S. fleet.

In Canada, the Alberta count rose by 47% to end at 220 rigs running. British Columbia climbed 21% to 29 rigs running. Saskatchewan as up by 96% to 53 running, and Manitoba added three rigs to end at 11, a 267% increase. Overall, the Canadian count climbed by 54% to end at 315 rigs running (170 oil, 144 gas and one "miscellaneous"). Eighty-nine oil rigs came back along with 21 gas rigs.

Meanwhile in the Lone Star State, December well permitting was up from year-ago levels, but well completions are still off.

The Railroad Commission of Texas (RRC) issued 1,009 original drilling permits in December compared to 727 in December 2015. The December total included 909 permits to drill new oil or gas wells, 17 to re-enter plugged wellbores and 83 for recompletions of existing well bores. There were 267 oil, 57 gas, 612 oil or gas, 62 injection, zero service and 11 other permits issued in December.

RRC staff processed 430 oil, 93 gas, 20 injection and two other completions compared to 788 oil, 151 gas, 53 injection and one other completions in December 2015. Total well completions for 2016 are 10,468; down from 19,503 recorded in 2015.

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