Gas rig count down last week
In the United States, the natural gas rig count was 314 for the week ended February 6, down by five compared to the previous week. In the major basins, the key reduction occurred in the Marcellus shale, where four rigs went off last week.
Natural gas rig counts have been on a downward trend for about three years. Nevertheless, the gas-targeted rig count seems to be stabilizing. It increased ten times in the last 17 weeks.
The turmoil in the crude oil sector has negatively impacted energy investors. Last week’s decline in gas rigs may strike a blow to investor expectations for a turnaround. Natural gas production, however, has been on a continuous uptrend. Read Natural gas production growth expected to continue to learn why.
Gas rigs down in the past year
The number of natural gas rigs decreased throughout the past one year. Last year, there were 351 natural gas rigs. Currently, there are 314 rigs. This is a decrease of 37 rigs, or ~11%. In the same period in 2014, weekly natural gas rig counts dropped by 74, or ~21%.
The number of natural gas rigs in operation suggests how major natural gas producers may feel about drilling these days. These include producers such as WPX Energy (WPX), Devon Energy (DVN), Chesapeake Energy (CHK), and Antero Resources (AR). WPX, DVN, CHK, and AR account for 3.4% of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).
Natural gas rigs in major US shales
In the last year, most of the decline in the natural gas rig count occurred in the Eagle Ford shale, where the number of gas rigs declined by ten. In the Marcellus shale, the number of rigs fell by 12. In the last year, the Granite Wash added 14 rigs to its natural gas rig total, the most of any drill site.
The one-year drop in natural gas rigs continues a downward trend that began in late 2011. Natural gas rigs topped 930 in October 2011.
In the next part of this series, we’ll look at drilling activity in the Permian Basin.