In its weekly release, Houston-based oilfield services company Baker Hughes Inc. (BHI) reported a dip in the U.S. rig count (number of rigs searching for oil and gas in the country), primarily reflecting a decrease in the tally of land rigs.
The Baker Hughes rig count, issued since 1944, acts as an important yardstick for drilling contractors such as Transocean Inc. (RIG), Diamond Offshore (DO), Noble Corp. (NE), Pride International (PDE), Nabors Industries (NBR), Patterson-UTI Energy (PTEN) and Helmerich & Payne (HP) in gauging the overall business environment of the oil and gas industry.
Weekly Summary
Rigs engaged in exploration and production in the U.S. totaled 1,772 for the week ended April 15, 2011. This is down by 10 from the previous week’s rig count and represents the first decline in 7 weeks.
Despite this, the current nationwide rig count is more than double that of the 6-year low of 876 (set in the week ended June 12, 2009) and significantly exceeds the prior-year level of 1,491. It rose to a 22-year high in 2008, peaking to 2,031 in the weeks ending August 29 and September 12.
Rigs engaged in land operations descended by 8 to 1,727, while offshore drilling fell by 2 to 26. However, inland waters activity remained steady at 19 rigs.
Natural Gas Rig Count
The natural gas rig count decreased for the second time in as many weeks to 885 (a drop of 4 rigs from the previous week). As per the most recent report, the number of gas-directed rigs are down approximately 11% from the 18-month high reached during mid-August, 2010, when it hit 992, the highest since February 2009.
The current natural gas rig count remains 45% below its peak of 1,606 in late summer 2008, but has rebounded strongly after bottoming out to a 7-year low of 665 on July 17, 2009. In the year-ago period, there were 973 active natural gas rigs.
Oil Rig Count
The oil rig count was down by 6 to 880, the first decline since February 25. Despite this week-over-week fall, the current tally is considerably more than the previous year’s rig count of 506. It has recovered strongly from a low of 179 in June 2009, rising almost 5 times.
Miscellaneous Rig Count
The miscellaneous rig count (primarily drilling for geothermal energy), at 7, remained unchanged from the previous week.
Rig Count by Type
The number of vertical drilling rigs rose by 9 to 552, while the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) was down by 19 to 1,220.
BAKER-HUGHES (BHI): Free Stock Analysis Report
DIAMOND OFFSHOR (DO): Free Stock Analysis Report
HELMERICH&PAYNE (HP): Free Stock Analysis Report
NABORS IND (NBR): Free Stock Analysis Report
NOBLE CORP (NE): Free Stock Analysis Report
PRIDE INTL INC (PDE): Free Stock Analysis Report
PATTERSON-UTI (PTEN): Free Stock Analysis Report
TRANSOCEAN LTD (RIG): Free Stock Analysis Report
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