Some great news came across our desk this week with a recent report conducted by Westwood Global Energy Group, via the SPE website. Here is an overview of the report:
“Westwood recently made this projection in its US Drilling & Completion Market Forecast Q1 2018, a basin-by-basin outlook using data gathered by the Energent Group, a market research firm recently acquired by Westwood that is focused on well life cycle and frac market intelligence.
“The report said that 2017 represented a marked recovery in activity and expenditure across the six basins covered in the report—DJ-Niobrara, Eagle Ford, Haynesville, Mid-Continent, Permian, and Williston—and through the wider US onshore sector.
“The report also projected that $63 billion will be spent across the basins covered from 2018 to 2022, and this expenditure will grow ahead of the rig count as a function of service pricing increases and increasing oilfield services intensity per well. Westwood expects 15% total expenditure compound annual growth rate. Completions are forecast to account for 69% of total expenditure over the period, with the Permian dominating both spend (the report projects 53% of total spend to come from the area) and activity (49% of well spuds).
“The rig count for the six basins is likely to reach 1,216 in 2022, an 83% increase from the 2017 average. Upside is projected at $93 billion in the high oil price scenario and $56 billion downside under the low price scenario. These figures are based on an assessment of future oil prices that sees a gradual upward increase within the $55–65/bbl range through the end of the decade, before climbing to $68/bbl in 2022.”
This year has already seen a resurgence in rig counts:
Data source: Baker Hughes Rig Count
Forty nine rigs have been added to U.S. shale plays in two months with a majority of them coming from horizontal drilling operations. This is reflective of the increasingly popular fracing operations taking place all over the U.S. Our industry has raised the bar time and time again when it comes to efficiency, and we will continue to support our members in the Eagle Ford who all maintain a gold standard of responsibility when it comes to drilling and fracing operations.