The Canadian Association of Oilwell Drilling Contractors (CAODC) has issued a revised well count for 2017 — projecting that 6,892 wells will be drilled this year, an increase of 2,177 from original forecast.
Last November, the association forecast that 4,665 wells would be drilled in 2017.
Other highlights of the updated forecast include:
- projected 2017 operating days: 71,839—an increase of 22,859 from original forecast; and,
- projected rig count for year-end 2017: 635—a decrease of 30 rigs.
While the stabilization of WTI pricing and a relatively cold winter in western Canada have helped increase utilization rates for CAODC members, market access and U.S. energy policy continue to limit Canadian industry competitiveness, the association said.
Although the federal government has approved Enbridge’s Line 3 and Kinder Morgan’s TMX pipeline projects, further delays are expected. An NDP-Green coalition government in British Columbia has indicated it would “use every tool in [its] toolbox” to stop the Trans Mountain expansion project, while the panel reviewing Energy East is proposing new and redundant processes nine months after protests stopped the initial review proceedings, it added.
In the United States, the association noted, outspoken government support for the oil and gas industry and U.S. energy independence has resulted in drilling activity in the Permian basin nearing a return to 2014 levels. Rig counts continue to grow because of more attractive day rates and lower costs, and CAODC members with U.S. operations are deploying capital and assets south of the border to take advantage of the more competitive marketplace.