Oil Drilling Pushes Rig Count Up - Analyst Blog
July 06 2011 - 9:40AM
Zacks
In its weekly release, Houston-based oilfield services company
Baker Hughes Inc. (BHI) reported a rise in the
U.S. rig count (number of rigs searching for oil and gas in the
country). This can be primarily attributed to an increase in the
tally of oil rigs.
The Baker Hughes rig count, issued since 1944, acts as an
important yardstick for drilling contractors such as
Transocean Inc. (RIG), Diamond Offshore
(DO), Noble Corp. (NE),
Nabors Industries (NBR), Patterson-UTI
Energy (PTEN) and Helmerich & Payne
(HP) in gauging the overall business environment of the oil and gas
industry.
Weekly Summary
Rigs engaged in exploration and production in the U.S. totaled
1,886 for the week ended July 1, 2011. This is up by 4 from the
previous week’s rig count and represents the highest level since
November 21, 2008.
The current nationwide rig count is more than double that of the
6-year low of 876 (set in the week ended June 12, 2009) and
significantly exceeds the prior-year level of 1,557. It rose to a
22-year high in 2008, peaking at 2,031 in the weeks ending August
29 and September 12.
Rigs engaged in land operations climbed by 4 to 1,837, while
inland waters activity and offshore drilling remained steady at 16
and 33, respectively.
Natural Gas Rig Count
The natural gas rig count, which slid to a 16-month low of 866
in May, increased for the second time in as many weeks to 874 (a
gain of 1 rig from the previous week). Despite the weekly
improvement, the number of gas-directed rigs is down nearly 12%
from its 2010 peak of 992, reached during mid-August.
The current natural gas rig count remains 46% below its all-time
high of 1,606 reached way back in late summer 2008, but has
rebounded strongly after bottoming out to a 7-year low of 665 on
July 17, 2009. In the year-ago period, there were 960 active
natural gas rigs.
Oil Rig Count
The oil rig count was up by 3 to 1,006. The current tally – the
highest in 23 years – is considerably more than the previous year’s
rig count of 587. It has recovered strongly from a low of 179 in
June 2009, rising more than 5.5 times.
Miscellaneous Rig Count
The miscellaneous rig count (primarily drilling for geothermal
energy), at 6, remained steady from the previous week.
Rig Count by Type
The number of vertical drilling rigs rose by 5 to 570, while the
horizontal/directional rig count (encompassing new drilling
technology that has the ability to drill and extract gas from dense
rock formations, also known as shale formations) was down by 1 at
1,316. In particular, horizontal rig units came off by 8 from last
week’s all-time high of 1,081.
BAKER-HUGHES (BHI): Free Stock Analysis Report
DIAMOND OFFSHOR (DO): Free Stock Analysis Report
HELMERICH&PAYNE (HP): Free Stock Analysis Report
NABORS IND (NBR): Free Stock Analysis Report
NOBLE CORP (NE): Free Stock Analysis Report
PATTERSON-UTI (PTEN): Free Stock Analysis Report
TRANSOCEAN LTD (RIG): Free Stock Analysis Report
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