The trend of increasing counts of active oil and gas drilling rigs continued in first week of 2021. Houston-based oilfield services firm Baker Hughes said as of Jan. 8 U.S. count rose 9 to 360 rigs, Permian added 4 rigs in past week to reach 179, Texas count remained unchanged with 161 rigs, and New Mexico added 4 rigs to reach 69. New Mexico’s gain was largest among major producing states.
Two New Mexico counties, Lea (36 rigs) and Eddy (32), remain the Permian leaders followed by Midland (18), Martin (17), Howard (14) and Reeves (14). Midland Basin has declined 6 rigs in the past month due to single rig drops by multiple operators.
Analyst Andrew Cooper of S&P Global Platts said last week recovery has slowed in Permian Basin, “which might be hinting at a trend possibly developing… With price-to-drilling lag time at something like eight weeks, it will be interesting to see what $50/b WTI does for west Texas operators, but we won’t see a response likely until February or March.”
Investment bank Tudor Pickering Holt said Jan. 6 horizontal fracturing also is rising. Active domestic fracturing units rose 2 to 3 percent in December over November with gains in Permian, Marcellus, Bakken, Haynesville and midcontinent partially offset by small declines in Eagle Ford and Rockies.
Haynesville remains runner-up in rig count among regions with 43 as of Jan. 8 followed by 30 in Marcellus, 26 in Eagle Ford, 11 in Williston and 10 in Cana Woodford. Louisiana remains third among states with 43 rigs as of Jan. 8 followed by Pennsylvania with 21, Oklahoma with 18 and North Dakota with 11.
U.S. Energy Information Administration said this week the nation’s crude oil production is expected to fall by 190,000 b/d in 2021 to 11.1 million b/d – a smaller decline than its previous forecast of a decline of 240,000 b/d. U.S. oil production in 2022 is expected to rise 390,000 b/d to 11.49 million b/d. U.S. exported more crude oil that it imported in 2020 for the first time since data became available in 1949, but EIA expects U.S. will return to importing more crude and petroleum products than it exports in 2021 and 2022.