On today’s how Kym will interview Nick Frayser from Aggreko, but first let’s check in with David Blackmon, editor of SHALE Magazine.
Kym: Let’s turn in the direction of south a little bit. What about the rig count? Last week, just one operator filed for a drilling permit in the Eagle Ford Shale. When can we expect to see the companies in that area reactivate those rigs and get their frack crews back working again?
David: Yeah, it’s a tough thing. The Eagle Ford Shale is almost shut down in terms of drilling. The daily rig count was 314 at the end of the week, which is by far the all time low. The Baker Hughes rig count was down around that level. Baker Hughes has been publishing their rig count for 60 years, and before this past month had never gone below 440. Now, they’re in the low 300s, so that tells you what a deep reduction this is. No one is reactivating drilling rigs right now. When you start to see that number come back, that’s when you’re going to start to see overall US production start to rise again. It’s going to take reactivating several hundred new rigs. So when can we start to see that? I honestly think you’re not going to start to see that rig count rise really substantially for the rest of this year. It might go up another 100-150 rigs. That won’t even be enough to maintain overall production. All these companies have their second half of the year budgets in place. They’re not going to go back in and change their budgets unless you see a big spike in oil prices, which I don’t think we’re going to see. I think we’re going to see a gradual rise, but we’re not gonna see a big spike. I do expect the rig count to rise over the rest of the year, but it’s not going to be back to the thousand active rigs. It might be back to the 500. So it’s going to be slow for the rest of this year.
Click above to here Kym’s interview with Nick Frayser.