LNG bucks PSAC drilling rig forecast

first_imgThe decrease in Saskatchewan is even worse, and at 1,507; it’s less than 50 per cent of the original estimate of 3,365.In Manitoba, as usual, the numbers are much smaller, but the decrease is 160 wells, and so the forecast is now for 270 as opposed to 430.There is however, a B.C. silver lining in the current forecast, as PSAC now estimates drilling activity in this province will result in 560 wells, which is actually a modest increase over the 555 in the original forecast.Salkeld also agrees it can be largely attributed to speculation concerning LNG development.Advertisement “That’s what it is,” he says. “It’s been quite on the LNG talk out there but there have been a lot of favourable decisions with respect to the feds; B.C. is working really hard to encourage that industry, which is really good.”“That LNG is bigger than just B.C.; it means a lot more than that.” PSAC has issued its mid-year Canadian Drilling Activity Forecast and has dropped the anticipated number of wells drilled this year to 5,320.That’s a 47 per cent drop from its prediction of 10,100 in October of last year, and President and CEO Mark Salkeld says it comes as no surprise following a 44 per cent drop in crude oil prices to less than $48 a barrel in March.Still in recent weeks, the price has managed to get back to around $60 a barrel U.S., and Salkeld says there’s reason for some optimism, although any major adjustment in drilling activity will likely to have to wait now until next year.- Advertisement -“The numbers are bad but we’re hoping to see a little bit of an uptick towards the end of the year – enough to bolster investor confidence, producer confidents, and start to ramp up like we typically do in Q4 going into Q1 of the following year into ’16,” says Salkeld.“Just crossing our fingers and hoping for the best.”As for the latest on the anticipated number of wells drilled this year, the Alberta total has been revised downward to just over half what it was – taking it from 5,740 to 2,976.Advertisementlast_img