Friday, December 9, 2011

U.S. Rig Count: Gas Rigs Down Big

The weekly Baker Hughes U.S. rig count showed a six rig decrease, bringing the total number of working rigs to 1,987.  Oil rigs were up 29 to 1,161, gas rigs were down 36 to 820 and miscellaneous rigs were up one to six.  By type, horizontal rigs were down five to 1,151, vertical rigs were down one to 619 and directional rigs held at 217.


Anonymous said...

Gas producers are so stupid to produce too much gas and pull gas price soon low. I am not sure they are really make money or not? What's the costs?????

They will have big financial trouble if they do not stop producing....

Robert Hutchinson said...

Part of the problem is that gas is produced as an afterthought of liquids and oil production in some cases. It often is flared in North Dakota where the pipeline infrastructure is not available, but where the pipes are in place and the target is oil (with gas as an afterthought), the gas hits the market.

The rig count is plummeting in the Haynesville, but now that most producers are setting up multi-rig pads and are drilling for efficiency rather than drilling one-offs to hold land, production per well is going to increase in the play. Even if rig count continues to decline, production won't follow in the same fashion.