Canadian operators seen boosting drilling next year

Canadian operators seen boosting drilling next year

The Canadian Association of Oilwell Drilling Contractors (CAODC) has released its 2017 drilling forecast.

According to a statement on the association's web site, CAODC is projecting that 4,665 wells—an increase of one,103 from 2016 (3,562)—will be drilled next year. Meanwhile, operating days are projected to reach 48,980—an increase of 8,577 from 2016. The rig fleet is expected to decrease by 55 to 610.

“After record low utilization rates in 2016, it might be tough to suggest 2017 may be something however higher. Weak commodity costs coupled with abnormal political and social factors, has led to sustained challenges for the industry. whereas the value of WTI is projected to stabilize somewhat, continued uncertainty surrounding pipeline infrastructure, and a looming value on carbon, continue to push canada to the rear of the road with respect to long-term investment,” CAODC said.

After 24 months of record-low activity, hundreds of thousands of layoffs, and an exodus of skilled labour, CAODC President Mark Scholz questioned the timing and effectiveness of recent policy decisions that may build the Canadian oil and gas industry even less attractive. “We continue to urge our governments at each the provincial and federal level to consider the impact of a carbon tax and lack of pipelines on the people and families in our industry. Canadians expect their government to attract jobs and investment during difficult economic times, not push them away,” said Scholz.

CAODC sees low activity continuing through all four quarters in 2017, with a modest improvement within the range of wells drilled. The forecasted rig count can remain close to historical lows however the well count is predicted to be slightly higher in saskatchewan.

“We expect a 45 increase in rig utilization with a rig fleet that continues to decrease. Activity is getting the right direction, however we’re still in a very depressed and desperate economic environment,” cautioned Scholz.

Scholz conjointly emphasized a similar purpose created in last year’s forecast concerning the important role provincial and federal governments play in these difficult times. “In order to achieve a healthy oil and gas industry, governments should ensure its fiscal policies are competitive, predictable, and consider the cumulative prices of doing business in canada versus alternative world jurisdictions.”