In its weekly release, Houston-based oilfield services company
Baker Hughes Inc.
) reported a rise in the U.S. rig count (number of rigs searching
for oil and gas in the country). This upside can be attributed to
an increase in the tally of oil-directed rigs, partially offset
by cutbacks in natural gas rig count.
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The Baker Hughes rig count, issued since 1944, acts as an
important yardstick for drilling contractors such as
Helmerich & Payne
), etc. in gauging the overall business environment of the oil
and gas industry.
Analysis of the Data
Rigs engaged in exploration and production in the U.S. totaled
1,806 for the week ended November 9, 2012. This was up by 6 from
the previous week's rig count and indicates the first increase in
The current nationwide rig count is more than double than that of
the 6-year low of 876 (in the week ended June 12, 2009) though it
is below the prior-year level of 2,016. It rose to a 22-year high
in 2008, peaking at 2,031 in the weeks ending August 29 and
Rigs engaged in land operations climbed by 7 to 1,740; offshore
drilling inched down by 1 to 50 rigs while inland waters activity
remained steady at 16 units.
Natural Gas Rig Count:
Natural gas rig count decreased for the second time in 3 weeks to
413 (a drop of 11 rigs from the previous week). As per the most
recent report, the number of gas-directed rigs is at their lowest
level since June 11, 1999 and is down 56% from its 2011 peak of
936, reached during mid-October.
The current natural gas rig count remains 74% below its all-time
high of 1,606 reached in late summer 2008. In the year-ago
period, there were 877 active natural gas rigs.
Oil Rig Count:
The oil rig count - which was at a 25-year high of 1,432 in
August - was up by 16 to 1,389. The current tally is way above
the previous year's rig count of 1,133. It has recovered strongly
from a low of 179 in June 2009, rising almost 8 times.
Miscellaneous Rig Count:
The miscellaneous rig count (primarily drilling for geothermal
energy) at 4 was up by 1 from the previous week.
Rig Count by Type:
The number of vertical drilling rigs rose by 8 to 508, while the
horizontal/directional rig count (encompassing new drilling
technology that has the ability to drill and extract gas from
dense rock formations, also known as shale formations) was down
by 2 to 1,298. In particular, horizontal rig units - that reached
an all-time high of 1,193 in May this year - decreased by 1 from
the last week's level to 1,104.