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Chasing 24,000 wells in Canada for 2005 Drilling contractors, petroleum services group offer similar forecasts for 2005; industry worried about shortage of skilled labor Gary Park Petroleum News Calgary Correspondent
Canada’s two leading oilfield support associations are like-minded in setting their drilling targets for 2005.
In forecasts released at the end of October, the Canadian Association of Oilwell Drilling Contractors predicted 24,205 wells, while the Petroleum Services Association of Canada has its sights on 24,035 wells.
The contractors’ association forecast would exceed its anticipated 2004 count by almost 3,000 wells, or 13.5 percent, and achieve a new benchmark.
It hinges partly on whether contractors can wipe out a backlog accumulated by weather setbacks through 2004 and reach the contractors’ association goal of 21,312.
But helping the outlook is a reduction in the average drilling time per well in the final quarter to 6.1 days from 6.4 days, an increase in active rigs to 504 from 432 and a subsequent increase in operating days to 36,945 from 33,613.
The contractors’ association forecast is based on projected commodity prices of US$40 per barrel for oil and US$6.12 per thousand cubic feet for NYMEX natural gas — both assumptions that the association acknowledges are on a low side.
But contractors’ association Chairman Don Herring does not expect that higher prices will translate into a significantly greater number of wells.
He said company budgets are being tied to prices of US$35-$40 per barrel.
Herring said that although the availability of rig hands is a concern, the industry has the equipment to test the 25,000-well barrier.
But the contractors’ association hunt for manpower includes jobs fairs in British Columbia that netted 500 workers from Vancouver Island in mid-October, and Canada’s Atlantic region. Rig count expected to be up by 40 in 2005 The rig count is predicted to average 473 in 2005, up by 40 rigs from 2004 and fleet utilization is expected to reach 64 percent.
Operating days next year are forecast to climb to 142,485 from 129,840 this year.
The services association is counting on a three-fold surge in coalbed methane wells to about 3,000 as a key driver in bumping the well total about 8 percent above its 2004 prediction.
Otherwise, the count for 2005 would be largely unchanged from 2004, said Petroleum Services Association of Canada President Roger Soucy.
The breakdown will see 18,610 wells in Alberta (up 10 percent from this year), 3,935 in Saskatchewan (up 3 percent) and 1,300 in British Columbia (up 6 percent).
Soucy agreed with Herring that the biggest constraint is the lack of skilled labor, not equipment.
The services association also raised its 2004 count to 22,160 wells, about 17 percent ahead of its original estimate in October 2003 and a record year by a small margin.
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