Remove Saskatchewan’s Bakken and its associated horizontal drilling from the equation and Canada’s upstream sector would be in the doldrums, or heading in that direction.
For the January-April period, the industry drilled 3,937 wells, down 8.06 percent from a year earlier, as well completions and permitting sagged across the four western provinces.
However, the wells accounted for 27 million feet of hole, a year-over-year increase of 7.85 percent and the second-highest four-month tally on record, trailing only the 2006 count of 32.8 million feet.
Helping keep the sector’s head above water is the Bakken activity in Saskatchewan, where operators completed 998 wells to the end of April, an increase of 19.38 percent over the same period of 2011, while regulators issued permits for 1,692 wells, the second highest total on record behind 1,831 in 2010.
In Manitoba, which includes the eastern edge of the Bakken formation, regulators awarded 169 well permits, up from last year’s record of 161, while well completions were 195 compared with 194 in the comparable period last year.
Otherwise the traditional powerhouse provinces are in bad shape. Alberta well completions fell 15.74 percent to 2,526 and new well permits dropped 23 percent to 408 wells. British Columbia completions are down 12.03 percent to 212 wells and new permits slumped 50 percent to 220.
More horizontal wells
The bleak outlook has forced the Petroleum Services Association of Canada to lower its average 2012 gas price to US$1.90 per thousand cubic feet at the AECO hub and reduce its well-count forecast for 2012 to 13,150 wells, down 200 from its previous forecast in January.
PSAC President Mark Salkeld said in a statement that “we have to bear in mind that the days of 20,000-plus boe/d wells are not likely to return any time soon.”
“That’s largely due to the fact that we are drilling longer and more complex wells now that are accessing plays once thought unreachable or fully tapped,” he said.
PSAC expects horizontal wells will comprise 50 percent of all well types this year, compared with 13 percent in 2007.
It estimates the province of Alberta will complete 7,949 wells this year, down 2 percent from 2011, and gas-weighted British Columbia will post 591 wells, off 5 percent from last year, while Saskatchewan will increase 13 percent to 3,962 wells and Manitoba will gain 6 percent to 618 wells.
To the end of April operators licensed 2,904 horizontal wells, trailing the comparable period of 2011 by 103 permits.
Producers reported completion of 2,865 oil development and exploratory wells for the four months, up 20 wells from last year.
