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CB

How Many Wells From 1 Onshore Rig?

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23 minutes ago, El Nikko said:

I'm not sure but some of those horizontal wells could be gas wells and if so that could bring the estimated number down closer to Dans estimation.

 

Excellent point!  The second file from the top on the Baker Hughes rig count page [https://rigcount.bhge.com/na-rig-count] (the "pivot table" is a massive Excel spreadsheet that lists every single rig since 2011.  I sorted on "gas" and then on "horizontal" and on 9/27/2019 there were 165 horizontal gas rigs.  That means 752 total horizontal - 165 gas = 587 horizontal oil.   If we go with the Westwood rule of thumb that 1 rig on average produces 20 wells per year (sometimes taking a month or more like your current project, sometimes 7 days per well like other projects you have been on) then you need 600 horizontal wells to get 12,000 new horizontal wells per year.  Our current number of 587<600. 

So actually we are below the decline threshold! (as far as new wells go).  There are still a lot of DUCs out there, so I don't expect massive draws from crude storage just yet.  It's interesting that Westwood, in that article you linked to, states that as of 1/31/19 there were supposed to be 10,300 DUCs by now (Q3 2019).    According to the EIA (https://www.eia.gov/petroleum/drilling/#tabs-summary-3) it never got that high, and is now declining. According to that EIA page, there were 8,092 DUCS in July, and 7,950 in August.  I while ago I looked back at their data for the past decade and a normal range can be about 5,000. So we have a ways to go. Dan Steffens has all but flat out stated the EIA figures are wrong- that the # of DUCS is now back to normal. I can't find any explanation as to why he makes that conclusion.

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