50% of the Canadian Rig fleet active! January 2017 - Fuck Yeah

[ExtraSlow]

Why climb the mountain? Because it is there!

[ExtraSlow]

Maybe this matters more, or at least as much, as drilling rigs:

Keep that number under 100 for 6-12 months, and natural decline will do wonders for supply and demand.
From a linkedin post about this video:

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-35 rigs this week. Including - 21 in permian.

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Not as many dropped as I assumed. Are we nearing the bottom of rig count? I wouldn't have thought so.

[ExtraSlow]

Dribs and drabs, it appears. North America dropped 38 rigs this week down to 362. USA land is 327 rigs. Interesting that 3 were Gulf of Mexico offshore rigs. Those operations are very slow to change.

I expect reductions to continue for at least another 6 weeks, but at a pretty low rate. 10-15 rigs per week. So the bottom something like 300 total and 250 USA land? Sometime around July 4th, because as everyone knows, that's the most important date on the calendar.

Should I be betting on this? @Darkane , don't tempt me.

[Darkane]

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Dribs and drabs, it appears. North America dropped 38 rigs this week down to 362. USA land is 327 rigs. Interesting that 3 were Gulf of Mexico offshore rigs. Those operations are very slow to change.

I expect reductions to continue for at least another 6 weeks, but at a pretty low rate. 10-15 rigs per week. So the bottom something like 300 total and 250 USA land? Sometime around July 4th, because as everyone knows, that's the most important date on the calendar.

Should I be betting on this? @Darkane , don't tempt me.

Haha. Yeah interesting that it’s slow.

Since oil has been kicking ass last two weeks, rigs might not go down very much.

Mind you the 50 million bbls of crude coming the gulfs way next week could completely crash pricing again. Might go negative.

I don’t even know what’s going on anymore.

[ExtraSlow]

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I don’t even know what’s going on anymore.

that is an accurate summary of my current petroleum investment thesis.

[ExtraSlow]

Also, the hard-hitting investigative journalists at oilprice.com report that the US rig count hasn't been this low since 1940.

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USA rig count dropped by 21 this week to 318.
Canada dropped 2 to 21.
Noryh America total is down to 339.

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Will we see north America under 300? Probably should. But who knows.

[killramos]

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Will we see north America under 300? Probably should. But who knows.

I really want to fire up a rig just to screw with you

[ExtraSlow]

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I really want to fire up a rig just to screw with you

If you do, I want to talk to you about toe activation tools. I don't know what you use now, but it's junk.

[killramos]

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If you do, I want to talk to you about toe activation tools. I don't know what you use now, but it's junk.

[ExtraSlow]

Minus 17 in USA and minus 1 in Canada to North America Total of 321, of which 309 are land rigs.
I am thinking it'll be small minuses for a couple more weeks, and mostly flat for a couple months after that. The good news is that 300 land rigs sure doesn't replace decline, so production will continue to fall through the remainder of 2020.
Customers in the USA that I've spoken to are looking at Sept or Oct for starting rigs back up again. That could easily slide a month or two if prices don't firm up by August. Seems like customers want $40/bbl to drill.

[ExtraSlow]

Minus 18 USA land, plus one in Canada. 292 land rigs in North America.

[Darkane]

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Minus 18 USA land, plus one in Canada. 292 land rigs in North America.

Keep going! What do we need? Under 200? I don’t see that happening as shale is looking to ramp again.

[ExtraSlow]

Honestly, anything under 300 is plenty low to let declines take over to dominate. The key is to have this last a 2-4 months, and not spike up too hard before Christmas. I can make my bosses really happy getting steady work on 4-6 rigs starting october or so.

[ExtraSlow]

was busy Friday, but the BH rig count showed Canada steady at 21, and US land down 5 to 266. Seems like a reasonable bottom. Heard two people say "things are picking up" in the US, but I think they are confused about what the change in slope of that line means. I still think we stay "near" our current levels, until mid-sept or later.

[Darkane]

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was busy Friday, but the BH rig count showed Canada steady at 21, and US land down 5 to 266. Seems like a reasonable bottom. Heard two people say "things are picking up" in the US, but I think they are confused about what the change in slope of that line means. I still think we stay "near" our current levels, until mid-sept or later.

Yes. There’s been fear regarding the second wave of Covid in China.

And the down and up again first wave here (USA).

Market may do the ‘ol W yet.

[ExtraSlow]

I don't see how any well-run producer could justify restarting rigs until WTI 6-months out is north of $45, but I'm assured that many are only waiting for $40. Seems like there's a lot of pent up energy to get back to drilling. Not sure if that's wishful thinking from the muddy-boots crowd, or actual push from the c-suite. Americans are pretty optimistic folks, and patience isn't their strong suit. I just hope for their (and all of ours) sake, they don't overdo it. Supply and demand are finally working, please please please let it.