Oil Rigs Fall -0.8% After 2 Weeks of Improvement
The BHI land rig count decreased -0.5% to 813, with oil rigs dropping -5 and gas rigs improving by +1 over the previous week. The Permian continues to improve, adding +3 rigs for the week, bringing the count to 242. Granite Wash added +2 oil rigs after 2 weeks of holding steady at 15 rigs.
In the Eagle Ford, rig activity continued to decline this month, releasing -4 rigs this week (or -3,9%), after having a strong first week in July. Gas rigs stayed flat at 21 rigs, same as the week prior, and oil rigs dropped -4.9% to 77 rigs.
Utica improved by +1 rig, bringing the count up to 22 rigs, of which 72.7% were gas focused. The Marcellus took a hit this week, declining -4.8% or 3 rigs from the previous week to bring the tally to 59 rigs for the week.
Summary of Shale Plays
- Permian Basin +1.3% to 242 rigs, compared to last week’s 239 rigs
- Eagle Ford -3.9% to 98 rigs, from last week’s 102 rigs
- Williston Basin -2.8% to 69 rigs, from last week’s 71
- Marcellus -4.8% to 59, from last week’s 62 rigs
- Mississippian +5.6% to 19, from last week’s 18 rigs
- DJ-Niobrara +3.3% to 31, from last week’s 30 rigs
- Utica +4.8% to 22, from last week’s 21 rigs
- Cana Woodford -6.1% to 31 rigs, from last week’s 33 rigs
- Haynesville -3.7% to 26 rigs, from last week’s 27 rigs
- WPX Energy (NYSE: WPX) entered the Permian Basin with the acquisition of RKI Exploration & Production, adding ~92,000 net acres and ~3,600 gross risked drilling locations. Current production gained by WPX in the acquisition is ~22,000 Boe/d. They are currently running 4 rigs and expect to increase activity by end-2015 to 6 rigs.
- Sanchez Energy (NYSE: SN) increased production 21% from Q1’15 to Q2’15. The 53,920 Boe/d produced exceeded their guidance of 42,000—46,000 Boe/d due to strong wells in Catarina and shorter drilling times. They have increased full-year production guidance, expecting a range of 44,000—48,000 Boe/d which was previously 42,000—46,000 Boe/d. As of June 30th, Sanchez had 32 gross wells waiting or undergoing completion, with the majority (27 gross wells) in Catarina.
- Eagle Ford-, Haynesville-, and Granite Wash-focused Sabine Oil & Gas (OTCQB: SOGC) filed for bankruptcy to restructure its balance sheet. In June, they skipped a $21 million interest payment on a senior note due in 2019 and has about $2.5 billion in debt. They expect operations to continue during the restructuring process by using cash from ongoing operations and cash on hand. Besides Sabine, others that filed for bankruptcy include Quicksilver Resources, Saratoga Resources, BPZ Resources, Dune Energy, and American Eagle Corp.