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Canada goes deep Scramble for rigs rated to 10,000 feet or more, with Canadian rig utilization at 49% in October; rig workforce at 213,000, up 9% Gary Park For Petroleum News
Canada’s upstream industry is dealing with a scramble to secure deep drilling rigs, according to the Canadian Association of Oilwell Drilling Contractors.
Triple rigs with rated depth capacities of 10,000 feet or more now make up 60 percent of the fleet, compared with 29 percent eight years ago, Mark Scholz, CAODC president told a PLS Inc. deal-making seminar.
In fact, he said, the demand is for rigs that can reach 10,200 feet and more to reach long horizontal wells, he said.
Noting that is where the demand is greatest, Scholz predicted a “very good year” for his sector, despite the slump in commodity prices.
CAODC’s latest numbers show a steady growth in rig utilization from 30 percent of the fleet at mid-year following a nosedive to 20 percent in May from a peak of 70 percent in February. By mid-October utilization had rebounded to 49 percent.
For CAODC, the more important statistic is the number of operating days, which reached 400,000 in the first quarter and was estimated at 132,000 in August, up 12,000 from a year earlier.
CAODC is now targeting a 20 percent increase for the current year from 2013, despite a dip to 820 well completions in September from 930 in the same month last year, which reflects the shift to deeper and longer wells.
Completed drilling almost 55 million feet The Daily Oil Bulletin, which gathers drilling data for CAODC, reported that completed drilling in the first nine months of 2014 was almost 55 million feet, up about 5 million feet from the same period of 2013.
The drilling sector is also making great strides in efficiency, taking 15 days to complete a well in 2013 compared with 45 in 2001, although well costs have risen.
Scholz noted that operating hours are now a more important measure for his industry than rig utilization.
He said that regardless of the impact on drilling of lower oil prices, there has still been a 9 percent increase in the rig workforce to a combined 213,000.
In its latest 2014 forecast, CAODC has projected a well count for the year of 11,494, 6 percent higher than last year, stemming partly from the strongest second quarter in 7 years, when operating days surpassed 17,000, compared with a low for the period of 8,411 in 2009 to a high of 16,369 in 2011.
For the third quarter, CAODC forecast 33,818 operating days and 45 percent rig utilization, while targeting 36,072 operating days and 48 percent utilization for the current quarter.
CAODC’s membership comprises 44 drilling contractors, two offshore contractors, 83 service rig contractors and 210 associate division members.
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