Land Rig Count Drops to 1599 as WTI Crude Increases to $48.45
US Land Rigs dropped -4.4% this week to 1599 from 1673, as reported in the weekly Baker Hughes Rig Count. The horizontal rig count dropped to 1247, a -3.6% decline in activity. WTI Crude edged up to $48.45.
Top 3 Shale Plays Drop 33 Rigs
Permian Basin is -15 compared to previous week and +9 compared to last year at this time. 30% of the US land rigs operate in the Permian Basin. Horizontal drilling activity remains strong with over 69% of the rigs drilling (see chart below).
Chart 1: Permian Basin Rig Count (source: BHI Rig Count, Energent Group)
Eagle Ford decreased -12 rigs to 185; at this time last year, there were 225 rigs operating in Eagle Ford, a -40 decline over the last 12 months.
The Williston Basin has 165 rigs running, -6 from last week and -13 compared to a year ago. Williston Basin break-even ranges from below $40/bbl to above $75/bbl. The counties below the $40/bbl include Dunn, McKenzie, Williams, and Stark. In these counties, the permit activity remains strong with a slight decrease in rig count over the last several weeks.
Chart 2: North Dakota counties with sub $40/bbl break-even
The Marcellus shale was -2 this week at 75 rigs and is -12 compared to last year.
Mississippian shale play was -1 this week and -5 compared to last year at this time. DJ-Niobrara is -2 this week down -3.6% and -1 from a year ago.
Granite Wash declines -14.6% this week to 43 rigs which is -13 rigs compared to a year ago. Utica shale play was +1 this week at 49 rigs and +10 from a year ago.
Upstream Companies Axe the Budget
Abraxas Petroleum Corporation (AXAS) has slashed their drilling capital budget to ~$53.8 million, approximately -70% from $190 million.
Sanchez Energy Corporation (SN) released that they would be cutting their budget to $600 – $650 million, their initial budget was $1.15 B, a reduction of about -60%.
Rosetta Resources (ROSE) is planning to operate 3 -4 rigs in 2015 with a capital budget of $700 – $800 million.
Swift Energy (SFY) will be cutting their budget for 2015 -75% to $100 – $125 million, compared to about $400 million in 2014.
Trican Well Service (TCW) has approved their 2015 capital budget at $39.2 million as of January 15, 2015, which will focus on an increase in their sand logistics capabilities in North America.
Precision Drilling (PD) is anticipating 15 new builds during 2015, planning on delivering within the first half of the year, while having about 92 rigs under contract.
We expect more companies to provide quarterly updates over the coming weeks.
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