Even after months of retrenchment, the U.S. rig count showed no signs of hitting bottom during the week ended Friday, dropping a whopping 21 units to plummet to 830, according to the latest data from Baker Hughes Co. (BKR).
Of the 21 rigs that fled the patch for the week in the United States, 17 were oil-directed and four were natural gas-directed. The combined domestic tally ended the week 238 units behind its year-ago total.
The declines included 17 horizontal units and four directional units. Twenty rigs packed up on land, with one exiting the Gulf of Mexico.
Canada, meanwhile, added four rigs week/week -- all oil-directed -- to increase its total to 147. That’s versus 200 active Canadian rigs at this time last year.
The combined North American rig count finished the week at 977, down nearly 300 units from the 1,268 rigs active in the year-ago period.
Among major plays, the Permian Basin saw the largest week/week decline, with five rigs exiting, ending the week at 417, down from 489 in the year-ago period. The Cana Woodford, Marcellus Shale and Williston Basin each dropped two rigs from their respective totals.
The Eagle Ford Shale, meanwhile, added three rigs for the week, growing its count to 63, versus 79 a year ago. The Mississippian Lime added one rig, while the Ardmore Woodford and Granite Wash each dropped one rig.
Among states, Oklahoma, down six rigs, and Texas, down five, suffered the heaviest losses. North Dakota and Wyoming each saw two rigs pack up shop during the week. Louisiana, New Mexico, Pennsylvania, Utah and West Virginia each dropped one rig, while Colorado added one.
As the 3Q2019 earnings season has gotten underway, oilfield services companies have sounded decidedly less-than-sanguine when discussing the outlook for North American exploration and production activity.
Houston-based Patterson UTI Energy Inc. is idling fracturing spreads in the Lower 48 and evaluating the economics of working versus shutting down more equipment through the end of the year as customers drop rigs. It ended the third quarter with 14 active spreads, and it idled another spread early in the fourth quarter, CEO Andy Hendricks said Thursday during a conference call to discuss results.
“It's been a challenging year, with the overall decrease in U.S. industry rig count, and the third quarter was the quarter with the fastest decline during the year,” Hendricks said. “Both drilling and pressure pumping activity are expected to decline further in the fourth quarter, but recent customer conversations suggest that our drilling rig activity will bottom in the fourth quarter and then a modest increase in late December and early January.”
North America’s biggest pressure pumping provider Halliburton Co. warned of waning activity for the remainder of the year as customers shun completions and new drilling.
Following a slow third quarter, CEO Jeff Miller told analysts last Monday that the domestic fracturing business is forecast to decline further in the final three months, with margins down by 125-175 basis points and revenue plummeting by low double digits.