US Land Drilling to Increase 11.5% in 2019
US land oil & gas operators report plans to drill 11.5% more wells in 2019 versus 2018 and Canadian oil & gas operators report plans to drill 8.4% more wells in 2019 versus 2018.
US land operators increased drilling by 14.2% in 2018 and the current projections for 2019, while a bit lower than 2018, still reflect a healthy optimism among the operators and continued growth for the industry.
Kimberlite Oilfield Research recently updated the 2019 drilling forecast based on interviews with 138 respondents from 100 E&P operators in North America. Only 7% of the operators interviewed report plans to decrease drilling in 2019 while the balance of the operators plan to either increase drilling in 2019 or maintain current levels.
US land operators continue to enjoy drilling efficiencies that allow them to drill wells more quickly than just 2 – 3 years ago. US land operators continue to drill longer laterals and plan to increase use of frac sleeves, dissolvable plugs and diversion in the next year to help complete the longer laterals that are not always accessible using traditional plug n perf.
Keep in mind that US land entered January, 2017 with only 640 drilling rigs operating and US land operators gradually increased the number of drilling rigs operating in the US land market to over 900 drilling rigs by the summer of 2017. Today, we are operating 1044 drilling rigs.
With oil prices stabilizing in the $60 to $65 range and oil & gas operators continuing to drive drilling and completion efficiencies to new levels, it is reasonable to assume that US land oil & gas operators will be able to enjoy a full calendar year in 2019 with approximately 1000+ drilling rigs operating. Adherence to market discipline and a focus on profitability by the US land oil & gas operators will also help to stabilize these elevated levels of activity.