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Texas Adds 3 Onshore Rigs, New Mexico's Count Falls by 3
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In its weekly release, Baker Hughes , a GE company, reported that the count for U.S. rig has remained unchanged.
About the Rig Count
Baker Hughes’ data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry.
A change in the Houston-based oilfield services player’s rotary rig count impacts demand for energy services like drilling, completion and production provided by the likes of Halliburton Company (HAL - Free Report) , Schlumberger Limited (SLB - Free Report) , Diamond Offshore Drilling, Inc. (DO - Free Report) and Transocean Ltd. (RIG - Free Report) .
Details
Weekly Summary: Rigs engaged in the exploration and production of oil and natural gas in the United States totaled 1057 in the week ended Aug 17, in line with the previous week’s count.
Despite the rig tally slipping to an all-time low of 404 in May 2016, it has been rising rapidly in U.S. shale resources. The current national rig count is considerably higher than the prior-year level of 946.
For the week under review, although the tally for offshore rig rose by a unit, the onshore rig count fell by one unit, keeping the total rig count in the United States flat with the prior week.
The number of onshore rigs totaled 1034, down from 1035. However, the tally for offshore rigs was 21, up from the prior week’s 20. The number of rigs operating in the inland waters was two last week, in line with the count for the week ended Aug 10.
Oil Rig Count: Oil rig count was 869, in line with the week ended Aug 10. The current tally, though far from the peak of 1,609 attained in October 2014, is significantly higher than last year’s 763.
Natural Gas Rig Count: The natural gas rig count of 186 was also in line with the prior week’s count.
Per the recent report, the number of natural gas-directed rigs is 88.4%, below the all-time high of 1,606 in 2008. However, like oil, the count of rigs exploring gas is above the year-ago tally of 182.
Rig Count by Type: The number of vertical drilling rigs totaled 65 units, down from the prior week tally of 69. However, the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) rose by four units to 992.
Gulf of Mexico (GoM): The GoM rig count is 19 units, of which 16 were oil-directed. The count is higher than the tally of 18 for the week ended Aug 10.
Conclusion
The inclusion of three onshore rigs in Texas added to the total count of rigs exploring in the United States. However, the removal of three land rigs in New Mexico offset the increase.
West Texas Intermediate (WTI) crude is now hovering around the $65-a-barrel psychological mark. Although the pricing scenario of oil is favorable for drillers, the production possibilities in the domestic shale plays — especially the Permian — remain dull owing to the pipeline bottleneck problem. In other words, the bottleneck in transportation capacity and labor shortage have made Permian operations expensive.
Denbury surpassed the Zacks Consensus Estimate in each of the last four quarters, the average positive earnings surprise being 162.9%.
We expect Northern Oil’s earnings to grow 250% year over year in 2018.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Texas Adds 3 Onshore Rigs, New Mexico's Count Falls by 3
In its weekly release, Baker Hughes , a GE company, reported that the count for U.S. rig has remained unchanged.
About the Rig Count
Baker Hughes’ data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry.
A change in the Houston-based oilfield services player’s rotary rig count impacts demand for energy services like drilling, completion and production provided by the likes of Halliburton Company (HAL - Free Report) , Schlumberger Limited (SLB - Free Report) , Diamond Offshore Drilling, Inc. (DO - Free Report) and Transocean Ltd. (RIG - Free Report) .
Details
Weekly Summary: Rigs engaged in the exploration and production of oil and natural gas in the United States totaled 1057 in the week ended Aug 17, in line with the previous week’s count.
Despite the rig tally slipping to an all-time low of 404 in May 2016, it has been rising rapidly in U.S. shale resources. The current national rig count is considerably higher than the prior-year level of 946.
For the week under review, although the tally for offshore rig rose by a unit, the onshore rig count fell by one unit, keeping the total rig count in the United States flat with the prior week.
The number of onshore rigs totaled 1034, down from 1035. However, the tally for offshore rigs was 21, up from the prior week’s 20. The number of rigs operating in the inland waters was two last week, in line with the count for the week ended Aug 10.
Oil Rig Count: Oil rig count was 869, in line with the week ended Aug 10. The current tally, though far from the peak of 1,609 attained in October 2014, is significantly higher than last year’s 763.
Natural Gas Rig Count: The natural gas rig count of 186 was also in line with the prior week’s count.
Per the recent report, the number of natural gas-directed rigs is 88.4%, below the all-time high of 1,606 in 2008. However, like oil, the count of rigs exploring gas is above the year-ago tally of 182.
Rig Count by Type: The number of vertical drilling rigs totaled 65 units, down from the prior week tally of 69. However, the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) rose by four units to 992.
Gulf of Mexico (GoM): The GoM rig count is 19 units, of which 16 were oil-directed. The count is higher than the tally of 18 for the week ended Aug 10.
Conclusion
The inclusion of three onshore rigs in Texas added to the total count of rigs exploring in the United States. However, the removal of three land rigs in New Mexico offset the increase.
West Texas Intermediate (WTI) crude is now hovering around the $65-a-barrel psychological mark. Although the pricing scenario of oil is favorable for drillers, the production possibilities in the domestic shale plays — especially the Permian — remain dull owing to the pipeline bottleneck problem. In other words, the bottleneck in transportation capacity and labor shortage have made Permian operations expensive.
Despite such limitations, we ask investors to consider energy stocks which will make valuable additions to portfolios. Two such stocks are Denbury Resources Inc. and Northern Oil and Gas, Inc. (NOG - Free Report) , with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Denbury surpassed the Zacks Consensus Estimate in each of the last four quarters, the average positive earnings surprise being 162.9%.
We expect Northern Oil’s earnings to grow 250% year over year in 2018.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>