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Bakken Shale Rig Count Decreases by Seven to 180

Bakken Operators Slash 2015 Budgets The  Bakken-Three Forks rig count  decreased by seven t0 180 rigs running across our coverage area by the end of last week. The NDIC notes 178 rigs are active in North Dakota, but around 13 of those are in the process of moving in and rigging up. In recent Bakken news, as the free-fall in crude prices continues, major Bakken operators are expressing their caution by slashing their budgets for 2015. Marathon Oil is the latest giant to announce that its projected budget will curb exploration spending by a whopping 20% for 2015. Though the company still forecasts spending in upwards of $4.4 billion, the decrease is another sign that the spiraling oil prices are casting a dark shadow over the incredible growth that is taking place in the shale regions. The U.S. rig count decreased by 18 to 1,875 rigs running by the end of last week. A […]

Posted On : Published By : Tom Whipple
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US Shale Oil Bonanza Is Coming to End — OPEC Official

By Sarah Kent ABU DHABI–The investment bonanza in U.S. shale oil is coming to an end as a result of the steep fall in oil prices, a senior OPEC official said Monday. "Investments in the North American shale and tight oil and gas industry will come to a slow halt," the United Arab Emirates OPEC governor Ali Al Yabhouni said, while vowing that the UAE would continue to invest in its oil sector to maintain and increase its market share. The comments follow a dramatic slide of nearly 50% in oil prices this year, accelerated by the Organization of the Petroleum Exporting Countries decision last month to maintain its oil output rather than cutting it to support the market. Speaking at an energy conference in Abu Dhabi, Mr. Al Yabhouni maintained that the slide in prices would be short term and was due primarily to new supply additions. "There […]

Posted On : Published By : Tom Whipple
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Bakken New Wells Producing Less Confirmed

It is has now been confirmed. The first measured 24 hour production from Bakken wells is a very good predictor of the future production of that well. And it has also been confirmed that new wells with higher well numbers are producing a lot less. In the NDIC’s Daily Activity Reports  they publish “WELLS RELEASED FROM “TIGHT HOLE” STATUS” as well as “PRODUCING WELL COMPLETED”. By searching these two lists, then eliminating the duplicates that appear on both lists, we find that perhaps 70 to 80 percent of all wells report their first 24 hours of measured production.  It is listed as “BOPD” (Barrels Oil Per Day) and “BWPD” (Barrels Water Per Day). An example below, and notice the second well listed does not give any production numbers: Producing Wells Completed The “per day” in this case is the first 24 hours of measured production and not necessarily  the first […]

Posted On : Published By : Tom Whipple
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Baker Hughes: US Oil Drillers Cut Rigs, Lowest Since May

Dec 19 (Reuters) – The number of rigs drilling for oil in the United States fell by 10 this week as low crude prices continued to threaten energy company revenues. The oil rig count dropped to 1,536 in the week to Dec. 19, the least since May, according to data from oil services firm Baker Hughes on Friday. The number of oil rigs has declined in seven of the last 10 weeks since hitting a record high of 1,609 in mid October, as a 50 percent drop in oil prices since the summer begins to take its toll on drilling projects. In the prior week ended Dec. 12, oil rigs declined by 29, the biggest weekly drop in two years. Energy traders have been watching rig data to see if the steep price drop was prompting oil drillers to cut back on the number of rigs. Some analysts however […]

Posted On : Published By : Tom Whipple
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Bakken Operators Slash Budgets for 2015

Bakken Operators Slash 2015 Budgets As the free-fall in crude prices continues, major Bakken operators are expressing their caution by slashing their budgets for 2015. Marathon Oil is the latest giant to announce that its projected budget will curb exploration spending by a whopping 20% for 2015. Though the company still forecasts spending in upwards of $4.4 billion, the decrease is another sign that the spiraling oil prices are casting a dark shadow over the incredible growth that is taking place in the shale regions. “We remain confident in our investment opportunities in the three U.S. resource plays,” Marathon Oil President and Chief Executive Officer Lee Tillman said in a statement. “Our 2015 capital program is not opportunity constrained but will reflect sound discipline in managing cash flows in the current price environment.” Related: Eagle Ford and Bakken Drilling Permits Fall 30% This news comes as oil plunged Thursday […]

Posted On : Published By : Tom Whipple
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Nabors Cuts Best-Paid U.S. Oil CEO’s Salary Amid Rout

Nabors Industries Ltd. (NBR) Chief Executive Officer Tony Petrello, the best-paid oil executive in the U.S., and his finance chief are getting salary cuts as the world’s biggest land-rig contractor confronts an industry downturn. Petrello’s base salary for the first half of next year will be pegged to an annual rate of $1.53 million, a 10 percent cut from the current $1.7 million. Chief Financial Officer William Restrepo is also getting a 10 percent cut in his annualized base salary, to $585,000, over the same period, the Hamilton, Bermuda-based company said today in a federal filing. “The salary reductions do not affect the calculation or payment of any ancillary benefits,” Nabors said. In 2013, Petrello’s total compensation included equity awards at $43 million when they were granted in March of last year, and he was granted $21.2 million in cash. This year, his potential total compensation reached more than […]

Posted On : Published By : Tom Whipple
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EIA, Analyst: US Crude Production Strong, Despite Rig Count Decline

Rig counts have trended lower in recent weeks, and the drop is right on schedule, according to online economic blog Zero Hedge. There is a lag time of about four to six months before initial declines in crude oil prices lead to a reduction in rig counts, and it’s been about that long since crude oil prices began sliding last summer. But while analysts acknowledge the reduction in rigs, they say production levels will continue to grow, though not as quickly. There can be a reduction of as much as 10 to 25 percent in the number of wells without making a large difference in production, Berkeley Research Group Managing Director Rick Chamberlin told Rigzone. “Production will continue to grow, but it just won’t grow at the same rate,” Chamberlain said, adding that until the Organization of the Petroleum Exporting Countries (OPEC)  agrees to lower production values, U.S. crude […]

Posted On : Published By : Tom Whipple
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Most North America Shale Plays Still Profitable at $65/Barrel

Most North America shale plays should remain profitable at $65/barrel, an industry expert tells Rigzone. At $65/barrel, most North America shale plays are still profitable with the current rig and well economics on an individual or series basis, according to an industry expert with A.T. Kearney. The firm doesn’t see any major pullback in activity at this price level, except for companies with stronger balance sheets possibly deferring or slowing programs to take advantage of consolidation opportunities with other players that may have higher debt levels and are looking for merger activity, said Vance Scott, partner and leader of the Americas energy practice at global management and strategy consulting firm A.T. Kearney. Deeper, more expensive shale plays that have more exotic completion requirements are always going to be more sensitive to commodity pricing, said Scott. Bakken wells tend to be deeper than wells in the Eagle Ford in South […]

Posted On : Published By : Tom Whipple