New Canadian well target, larger rig fleet in store

The Petroleum Services Association of Canada has fine-tuned its 2005 well-completion forecast, revising its target to 24,075 — up 40 wells from its fall forecast, but 8 percent above last year’s record tally of 22,696.

Association President Roger Soucy said the tweaking results mostly from stepped up coalbed methane activity and “continued strong commodity prices.”

Since its October 2004 projections for the major operating areas, the association has raised the bar for Alberta to 18,625 wells, up from 18,610, trimmed Saskatchewan by 15 wells to 3,935 and left British Columbia unchanged at 1,300.

The outlook for 2005 on top of the frenzied pace of drilling in the last few years has the Canadian Association of Oilwell Drilling Contractors expecting steady growth of the rig fleet from 718 at the end of 2004 to 730 this quarter and 750 by year’s end.

Don Herring, president of the contractors’ association, is betting that the current momentum will see record rig utilization this year, extending through 2006 and 2007.

Coalbed methane holds one of the keys, with the well count expected to triple this year to 3,000 and build even more in 2006 provided the industry keeps finding dry coal and the economics hold firm.

—Gary Park