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Permian, GOM Gain as U.S. Drilling Activity Rises in BKR’s Count
Bolstered by gains in the oil patch, including in the Permian Basin and the Eagle Ford Shale, the U.S. rig count rose three units to reach 775 during the week ended Friday (Jan. 13), according to updated numbers published by Baker Hughes Co. (BKR).
Changes in the United States for the week included a five-rig increase in oil-directed drilling, partially offset by a two-rig decline in natural gas-directed drilling. Activity on land was unchanged overall for the week, while the Gulf of Mexico added three rigs to raise its total to 19. Directional rigs increased by three, while total horizontal and vertical units were flat week/week.
The combined 775 active U.S. rigs as of Friday compares with 601 rigs running in the year-earlier period, according to the BKR numbers, which are partly based on data from Enverus.
The Canadian rig count jumped 38 units higher to 227 for the week, up from 191 in the year-earlier period. Gains there included 28 oil-directed rigs and 10 natural gas-directed rigs.
Counting by major drilling region, the Permian added three rigs week/week to raise its total to 356, versus 293 a year ago. The Eagle Ford added two rigs for the period to end at 73, up from 50 at this time last year.
Elsewhere among plays, the Mississippian Lime added one rig for the period. The Cana Woodford dropped two rigs, while the Barnett Shale, the Denver Julesburg-Niobrara and the Haynesville Shale each dropped one rig from their respective totals, according to BKR.
Counting by state, New Mexico added three rigs to raise its tally to 103, while California, Louisiana and Texas each added one rig for the period. On the other side of the ledger, Oklahoma dropped two rigs, while Colorado dropped one, the BKR data show.
The U.S. natural gas and oil sector is likely to achieve moderate growth this year, preferring to hoard cash, reduce debt and continue investor payouts while awaiting stronger commodity prices, according to a bevy of energy analysts and executives.
NGI pored through detailed forecasts by analysts and discussed the 2023 outlook with energy executives for insight into what to expect this year. It’s still early, but exploration and production companies are likely to remain disciplined over incurring debt.
The upstream sector should have “another strong year,” but commodity prices and free cash flow are unlikely to match 2022 levels, according to Moody’s Investors Service. Mizuho Securities USA LLC is forecasting the U.S. gas macro also to be “challenged until further LNG capacity comes online in late 2024.”
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