In the latest US rig count released by Baker Hughes (BHI), the number of active US rigs drilling for oil and gas grew by 35 in the week ended January 20, 2017, to 694. There were 659 active rigs one year ago. According to the latest numbers, 281 rigs now lie in the Permian Basin, which added the most rigs last week (13).
Some of the most active drillers in the Permian basin include Chevron (CVX), Occidental Petroleum (OXY), Apache (APA), and Pioneer Natural Resources (PXD). These companies make up 10% of the Energy Select Sector SPDR ETF (XLE).
The above image from BTU Analytics, an energy research and analysis firm, shows the estimated oil production growth this year in the Permian Basin. For this reason, the Permian will likely see a lot of activity in 2017, as oil prices continue to improve. This can be seen in the mad rush of producers trying to get their slice of the Permian pie.
We’ll talk about this in more detail in next part.