Friday, June 19, 2009

Rig Count: +23 U.S., +5 Haynesville Region

Baker Hughes came out with its weekly rig counts today, and it showed an increase for the first time in a long time. The number of rigs in the U.S. increased by 23, or 2.6%, to 899. The count is still down 1,007 from this time last year.

This increase in rigs is definitely notable. This is only the second time this year that the rig count increased, and the previous increase was a four rig bump sandwiched between a couple of large drops a few months ago. The last time the rig count increased by this much was nearly a year ago in August 2008. Does this represent a change in sentiment for the industry? An indication of bottom? A statistical anomaly? I guess we'll know more in a few weeks.

Of the rigs working nationally, 77% are drilling for gas, 22% are drilling for oil and 1% are classified as miscellaneous. Most of the rigs (43%) are horizontal rigs, while 37% are vertical and 19% are directional. Interestingly, over the course of one year, the percentage of horizontal wells has increased 15 percentage points from 28.5% of all rigs to the current 43.5%. Not surprisingly the percentage of vertical wells has dropped by 14 percentage points over that same period.

In the Haynesville Shale region of East Texas and North Louisiana (which includes other fields), the rig count increased by five, all in Louisiana.

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