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Ardmore Woodford & Eagle Ford Add 2 Oil Drilling Rigs Each

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In its weekly release, Baker Hughes, a GE company (BHGE - Free Report) reported an increase in weekly rig count in the United States. 

More on 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 players’ rotary rig count affects demand for energy services like drilling, completion and production provided by companies like Halliburton Company (HAL - Free Report) , Schlumberger Limited (SLB - Free Report) , Diamond Offshore Drilling, Inc (DO - Free Report) and Transocean Ltd. (RIG - Free Report) .


Total U.S. Rig Count Increases: Rigs engaged in the exploration and production of oil and natural gas in the United States totaled 1049 in the week ended Feb 8, up from the prior week tally of 1045. This marked an increase in rig count after the tally fell by 14 through the week ended Feb 1.

Despite rig count 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 higher than the prior-year quarter’s level of 975.

The number of onshore rigs totaled 1029, up from 1025 in the previous week. Moreover, the tally for offshore activities totaled 19 and one rig operated in the inland waters, both in line with the prior week’s count.

U.S. Adds Seven Oil Rigs: Oil rig tally was 854, up from 847 in the week ended Feb 1. This marked a rise in count for oil drilling rigs after the tally was down by 15 through the week ended Feb 1.

Moreover, the current total, far from the peak of 1,609 attained in October 2014, is higher than the tally of 791 a year ago.   

Natural Gas Rig Count Declines in the United States: The natural gas rig count of 195 is lower than the count of 198 for the week ended Feb 1.

However, like oil, the count of rigs exploring the commodity is above the prior-year quarter’s 184. Notably, per the recent report, the number of natural gas-directed rigs is almost 88%, below the all-time high of 1,606 in 2008.

Rig Count by Type: The number of vertical drilling rigs totaled 68 units, up from the previous week’s tally of 63. But, the horizontal/directional rig count (encompassing new drilling technology with the ability to drill and extract gas from dense rock formations also known as shale formations) fell by one unit to 981.  

Gulf of Mexico (GoM) Rig Count Flat: The GoM rig count is 19 units, of which 15 were oil-directed. The count was in line with the prior week count.


Two oil rigs were added in each of Ardmore Woodford & Eagle Ford resources, boosting the weekly rig count.

It is to be noted that Schlumberger during its quarterly results announcement revealed that explorers and producers are getting more conservative about investing owing to volatile oil prices. Conservative investments in upstream activities might affect demand for rigs. Hence, drillers may lower rig count in the coming weeks.

Despite the pessimism, there are a couple of upstream energy players like Concho Resources Inc (CXO - Free Report) and Apache Corporation (APA - Free Report) that investors could keep an eye on. Both the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.  

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