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Rig Count Increases
Commentary by Eric Wilder – Those of us in the industry have seen steady increases in the price it takes to hire a rig to drill a well. Just one year ago, an operator could drill a 6,000’ well in Logan County, Oklahoma for $14/foot, or about $84,000. Footage rates are now all but nonexistent as drillers are charging $13,000 to $17,000 per day for the same well – a cool $180,000 to $250,000, depending on how many days it takes to drill 6,000’. The more incompetent the driller, the more it costs. Sounds backwards, doesn’t it? All the service companies have followed suit and the actual cost to drill and complete a well has in many cases tripled in the last year. Thank goodness for supply and demand! Because of the outlandish profits the service companies are reaping, people are again building new drilling rigs and completion units. One year ago, there were 1436 rigs operating in the United States, according to Baker Hughes, a company that has kept track since 1944. Today there are 1737, an increase of 301 rigs. It is still difficult to get a drilling rig quickly, but we are getting there as new drilling rigs are coming into service. Here’s a little hint for anyone that wants to fabricate some rigs and make some money – we need at least another 1,000 rigs. Until we get them, drilling costs will remain high, thus affecting the entire chain from concept to gas pump. http://www.ericwilder.com
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