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U.S. Oil Rig Count Rises to Highest Level Since 1993

General discussions of the systemic, societal and civilisational effects of depletion.

Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Subjectivist » Fri 13 Mar 2015, 18:52:56

America stacked another 67 Rigs this week and Canada even more, 80.

http://phx.corporate-ir.net/External.Fi ... U9MQ==&t=1

Texas was hit hardest with 37 stacked, 22 of them in the Permian Basin.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Fri 13 Mar 2015, 21:12:34

dashter - Not sure about your chart. Based on the Baker Hughes numbers just posted that chart appears to be for all of N America...not the US. As of 13 March, as Sub posts, BHI shows 1125 rigs...down 67 from a week ago. And Texas is down 37 to 501 from a week ago.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Tanada » Sat 21 Mar 2015, 14:34:09

More not so good news.

The number of US rig counts fell by 41 last week to 825, according to the latest data from oil driller Baker Hughes. This is the lowest oil rigs in use since March 2011.

Combined oil and gas rigs fell by 56 to 1,069, the lowest since October 2009.

Since hitting a peak of 1,609 in late October, the number of oil rigs is use is down about 49%.

In previous downturns in the price of oil, the number of oil rigs in use has declined by around 40%-60%, according to comments made by Baker Hughes on its first quarter earnings conference call.

And while the market has been looking at the decline in rig count, the bigger story in the oil market may be quickly dwindling amount of storage for the oil that US producers continue to pump out.

Here's the latest chart of the decline in rig count.
http://www.businessinsider.com/baker-hughes-rig-count-march-20-2015-3
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Tanada » Sat 28 Mar 2015, 17:00:09

Baker Hughes reports the oil rig count for USA is down another 12 from last week and has fallen a total of 674 from one year ago Friday. Rigs still in service include 92 Directional, 829 Horizontal and 148 Vertical.

http://phx.corporate-ir.net/phoenix.zht ... portsother
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sat 28 Mar 2015, 20:59:24

T - Good job of keeping tabs on the rig. But : "Rigs still in service include 92 Directional, 829 Horizontal and 148 Vertical." A reminder to avoid confusing folks: the same rig drills vertical, horizontal and directional wells. Wells are permitted as vertical, directional, horizontal, oil or NG. That's the stat that BHU keeps track of...the permits being drilled. Thus the rigs still drilling could be poking nothing but hz wells or none at all. It all depends on what permits the operators choose to drill.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby peripato » Sat 28 Mar 2015, 23:10:26


Looks like a Seneca Cliff
Image

http://bit.ly/1Hd6XSh
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sun 29 Mar 2015, 08:22:59

P - That depends somewhat on where you start your curve and the scale you use. Try plotting the rig count since BHI started the stat and use zero as the base. It will still show a significant drop but by not nearly as much as the fall from 4,500+ in the early 80's. Plotted properly it will look more like a strong dip in a plateau then a cliff.

Besides the "cliff" aspect typically refers to production rates. Lots of stats do have SC's. Such as life: one day you alive and the next you plunge off a cliff when you assume room temperature. LOL.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Tanada » Fri 10 Apr 2015, 15:19:02

At least a few are paying attention. Lovely graph showing the whole recent activity in nice hard to misunderstand form at the link below.

The number of oil rigs in use in the US keeps collapsing.

This week, the number of active rigs fell by 42 to 760, the lowest weekly total since December 17, 2010.

Combined oil and gas rigs were down 40 to 988 as 2 natural gas rigs came on-line this week. This is the lowest combined total for oil and gas rigs since August 21, 2009.

Since hitting a peak of 1,609 back in October 2014, the number of US oil rigs in use is down by about 53%.

The biggest declines this week was seen from horizontal drilling rigs, as 29 horizontal rigs shut down; 8 vertical and 3 directional rigs also shut down. On state-by-state level, Texas saw 29 rigs shut down last week, with 21 of those coming from the Permian shale basin. The Eagle Ford shale basin saw the second most rigs shut down last week with 12.

In its January earnings report, Baker Hughes said that during past oil downturns the number of rigs in use has declined by 40%-60%.
http://www.businessinsider.com/baker-hu ... z3Ww4US6tB
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Tanada » Fri 15 May 2015, 13:47:54

Type--------current--------(+/-)---------week ago---------------(+/-)-----------------year ago

Directional-- 89------------- -1 -------------88 ------------------- -118-------------------- 207
Horizontal-- 685------------ -7 ------------692-------------------- -563------------------- 1248
Vertical----- 114------------- 0------------ 114-------------------- -292-------------------- 406

Total rigs stacked now that were active one year ago today -118-563-292= 973!
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sat 16 May 2015, 11:12:40

Of course those 685 rigs will drill wells that add as much new oil production from the shales as the 1248 rigs did a year ago. Yeah efficiency!!! LOL.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby Tanada » Sat 16 May 2015, 15:37:02

ROCKMAN wrote:Of course those 685 rigs will drill wells that add as much new oil production from the shales as the 1248 rigs did a year ago. Yeah efficiency!!! LOL.


I wouldn't actually mind if that turns out to be the case. On the other hand my optimism on the topic is limited ROFL.

ROCKMAN a while back you said it is getting cheaper and easier to get rigs to drill for your company, is this still the case? Just how much have drilling costs come down for you assuming it is not a trade secret?
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sat 16 May 2015, 17:04:39

T - Lots of services being cut 50%...or more: rigs going for $24k/day a year ago being bid at $14k/day...or less. Some materials being offered at cost and even below cost: as is often the case during a crunch cash flow is more important then profit margin.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sat 16 May 2015, 17:12:40

T - In order to reduce the competition pressure companies are mothballing a lot of equipment and laying off hands. That reduces overhead but obviously in doesn't improve revenue...just net cash flow. And in some cases giving up all the profit margin and selling inventory below cost. I just got a bid from Schlumberger for some specialized down hole equipment for $32,000/30' joint. The next lowest bid was $95,000/30' joint. A good bet Blue is selling at or below cost.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby farmlad » Sat 16 May 2015, 23:11:14

Rock Were the 4500+ drilling rigs in the early 80s capable of drilling as many feet per day, in similar conditions as the ones they use today?
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sun 17 May 2015, 10:41:13

lad - Yep, easily. In general rigs are size classified by the hp output of their generators that ran their electrical systems: 500 hp to 3,000 hp in increments of 500. While some of the down hole steering systems that allow hz drilling is relatively new there is essentially no significantly difference in rigs today then many decades ago: there is a rotary table that grabs the drill pipe and rotates it clockwise as it's lowered down the hole. That's how wells have been drilled for more the 70 years.

BTW: "The deepest well drilled in the onshore U.S. still remains the Lone Star No. 1 Bertha Rogers, which was completed in 1974 in the Ordovician Arbuckle Formation as a wildcat well to a depth of 31,441 feet in Beckham County, Okla., in the Anadarko basin. Fifty-one other wells have been drilled below 25,000 feet in eight regions of the U.S. Despite the record-setting Bertha Rogers and other deep wells in the Anadarko basin, the Permian basin currently holds the record for the number of ultra deep wells with 21 wells, of which 10 were completed as gas wells. The Anadarko basin ranks second with 19 ultra deep wells of which 12 were completed as gas wells. For the U.S. as a whole, 27 of these 52 ultra deep wells were completed as gas or oil wells."

Essentially all this was done so long ago with nearly identical drill rig tech we have today. Offshore, especially Deep Water, is a very different infrastructure. But the drill rig portion of those monster floating vessels (with the tech used to keep them on station in 5,000'+ of water) is little different then that used drilling onshore wells in 1980. Same is true for Eagle Ford horizontal wells: some of the rigs drilling them today were built before the first ever horizontal well was spudded in the US.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Sun 17 May 2015, 16:36:26

I may be making a poor assumption: everyone here understands what a drill rig really is. It's not a piece of equipment per se. It's a number of components that are linked together. The big components: the derrick...a tower of dumb iron that supports the drill pipe. The electrical generators that power the various electrical motors such as the lights, mud pumps, the hoist that raises and lowers the drill pipe and lastly all the smaller electrical equipment packages. Essentially a drill rig never wears out...the individual components do with the one exception of the derrick. And a rig can be updated by putting bigger generators and bigger mud pumps on it.

So a "drill rig" might be 50 years old but has had its components replaced many times. As long as the derrick isn't damaged a drill rig can last forever. Or until the next oil patch slump...that's the cause of rig attrition...the components are sold and the derrick sent to the scrap yard. And the same can be said for the frac'ng equipment...many of the "frac crews" have existed for decades...unless they have been scrapped. The size (measured in pounds of proppant and pump pressure of most of the individual frac stages used in hz wells today are smaller than used in vertical wells 40+ years ago.

The only relatively new equipment in play is the directional drilling equipment. And this is just about a 60' long section attached to the bottom of the drill pipe. The equipment to drill away from the vertical (to 60 degrees or so) has existed for 40 years. The down hole equipment to drill all the way to 90 degrees (horizontal) has been used for more than 20 years.

So take the hype of "great recent advances" in drilling tech with a big grain of salt. The really important "new tech" that created the shale boom was financial: high priced oil.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Mon 18 May 2015, 10:14:09

And one more tech that has really been a game changer. And one that is never mentioned by the cornies: mud motors. Remember the drill pipe has to rotate to make the drill bit rotate to cut the rock. But when you have thousands of feet of heavy drill pipe laying on it's side it's very difficult to turn it with the rotary table 2+ miles above it. So many years ago some clever engineers developed mud motors. The easiest analogy is your lawn sprinkler: the water pressure from the garden hose rotates the sprinkler head in a circle. IOW the garden hose doesn't rotate. The mud motor does the same: attached at the end of the drill pipe the mud pumped down the inside of the pipe turns a turbine inside the mud motor which turns the drill bit. Thus the drill pipe "slides" along instead of rotating. It's this sliding motion that allows corrections to the angle and direction of the hole to be adjusted.

Without this little bit of tech, unknown to virtually all the public, there would have been no shale boom. But, again, this critical tech preceded the shale boom by many years. Just had to wait until oil prices got high enough to justify applying it to the shales.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby hvacman » Mon 18 May 2015, 11:59:12

RM - I learn something every time you post and find interesting ways to apply it.Thank you. My own business is engineering building HVAC systems, which most would assume is about as far from the drilling scene as one can get. But not so...one example are ground-source heat pumps (AKA "geothermal" heat pumps). I've designed about a dozen systems and been on-site when the borefield installers were doing their thing. They use specialized light-weight truck-mount drilling rigs similar to water-drilling rigs. If ever there is a "simple" drilling duty, ground-source vertical bores are it. Drill an open 5" hole 300 feet down in the ground. No liner or sleeve (other than the code-required sanitary seal at the top 30'). No developing the bottom for water or oil or gas. No down-hole pump. Just an empty hole. Once it's drilled to-depth, the driller pulls the drill string and slides in a pair of 1" polyethylene tubes connected with a U-fitting down to the bottom of the bore. Grout the hole solid with a specialized Bentonite blended with a high-heat-conductivity silicon sand, leaving 4' pigtails of the 1" poly tubes sticking out of the ground for the "looper" to later connect to the above-grade portion of the heat pump system.

About as simple as it could get. Yet even this apparently-brain-dead simple drilling activity is still fraught with challenges. Continuously logging the mud to see what the strata is at what depths they actually are boring through (Strata composition affects heat transfer, which affects the prescribed Bentonite sand content). "lost circulation" when they hit some void. Broken drill bits. Broken hydraulic hoses and about a thousand other prone-to-fail parts. Granite or basaltic volcanic rock which no one expected, slowing the drilling to a crawl and affecting the bottom line of the driller stuck with a lump-sum drilling fee. Hands (and observing engineers) always on-guard to not get conked in the head when installing/removing another stick of drill pipe.

Your various discussions about the big-boy oil version of this drilling process continues to improve my own understanding of what the heck is going on when I'm watching a heat pump vertical borefield being installed and how the crews handle the various problems that always seem to crop up.

The size of the rig changes, the HP is different, but the basic job is the same. A tip of the hard-hat to all who take on the dangerous, messy, and very-necessary job of plunging into the below-grade unknown and some how, in some way, create access to something of human use, be it geothermal hot water, a ground-source heat heat exchanger, flowing oil or gas, or ag or drinking water.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby ROCKMAN » Mon 18 May 2015, 12:18:05

HVAC - I still consider low temp geothermal recovery to be one of THE biggest potential energy saving techs in the US. Not that each application provides that much cheap energy but that there are millions of potential projects to be done. Such as commercial office parks and buildings, malls and home subdivisions. There just so many The Geysers fields to be developed in this country and thus collectively won't make a difference.

The water well drillers in my part of Texas face another danger: shallow NG. In an area of known shallow production I mud logged and ran wire line logs all the way from ground level to total depth. Logged a beautiful 20' thick NG reservoir (not fresh water contaminated with NG) at 46'. No...not 4,600'...46'. And it was also in the 300' water well located just 50' away from my well. Not uncommon for them to see these naturally occurring shallow NG traps in their water wells. Which is why they are very careful to not pull out of the hole too quickly and thus "swab in" a blow out. At 46' the NG reaches the surface before you can turn around to run away. Dead is dead be it at Macondo or on a water well rig.
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Re: U.S. Oil Rig Count Rises to Highest Level Since 1993

Unread postby hvacman » Mon 18 May 2015, 16:40:45

I still consider low temp geothermal recovery to be one of THE biggest potential energy saving techs in the US.


Just to clarify, the GSHP industry has increasingly changed from using the phrase "geothermal" to "ground source". At shallow depths below 300' (in most cases) ground temperature is influenced much more by the average annual surface temperature and the solar "heat from above" than geothermal heat conducted "from below". I guess you could say it is more "heavenly" than "hell-ish". Of course, that is not what the "ground source" borefield driller said when he hit those pockets of undocumented old lava flow rock 200' down that no one expected.

The problem with ground source is the cost of the bores. It is a lot less popular around here now than back in the early 2000's. Borefield costs have more than doubled and there are some increasingly-good/efficient air-source heat pump alternatives. Maybe with all these rigs stacking, the cost will come down again with a lot of unemployed hands looking for SOMETHING to do drilling-wise. That's how we got some great GSHP drilling deals when I first got into the GSHP side of things in the late 90's - unemployed gas/oil drillers who came up to northern California to tap into the GSHP craze. I think a lot of them lost their shirt on that, too. Drilling's a tough way to make a living, that's all I can say.

That's scary stuff about hitting NG at 46 feet just for drilling a water well. Seems EVERYTHING is bigger/more exciting/more dangerous in TX!

Quick question -what does "swab in" mean? OK - a not so quick follow-up question - And if a water driller does hit a shallow NG pocket on the way down to an aquifer, what do they do to protect themselves while drilling and develop the water well further down, and protect the owner from all sorts of nasty things in the future, like that flammable water people show off to attack fracking in PA?
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