CAODC 2019 Drilling Forecast
For Immediate Release: November 22, 2018
CAODC announces the release of its 2019 Drilling Forecast (*forecast + actual)
- Projected 2019 wells drilled: 6,962—an increase of 51 from 2018 (6,911*)
- Projected 2019 operating days: 69,617—an increase of 507 from 2018 (69,110*)
- Rig fleet expected to decrease by 58 (580 drilling rigs to 522 drilling rigs)
- Pricing differentials and pipeline delays will continue to curtail capital expenditures
“The lack of activity is not hard to understand,” explains CAODC President, Mark Scholz. “The Canadian oil and gas industry is simply too dysfunctional to anticipate any kind of quick recovery.”
As a result, Canadian service companies are exploring any and all options to generate positive cash flows. “Our members are on life support,” says Scholz. “With the exception of perhaps Venezuela, Canada is the only oil and gas producing jurisdiction in the world that cannot at the very least see a recovery on the horizon. We have among the highest standards for responsible development in the world, yet our products are sold at bargain basement prices.”
CAODC sees no improvement in sight for activity levels through Q3 2019, although the completion of Enbridge’s Line 3 replacement could produce a modest boost in drilling activity in Q4. Further, the Canadian rig fleet is expected to continue to decrease at a steady pace, with newer, high-spec rigs and associated senior Rig Technicians being deployed to the United States where costs are lower and day rates are higher. In 2018 CAODC members delisted 26 drilling rigs with 11 of those (42 per cent) relocated to the US.
Scholz continues to emphasize the important role provincial and federal governments play in these difficult times. “Tone at the top matters, and investors are uncertain as to whether Canada wants to be in the oil and gas business in any meaningful way.”
The Canadian Association of Oilwell Drilling Contractors (CAODC) represents Canada’s drilling and service rig industry.
For more information, contact:
John Bayko – Vice President, Communications
Canadian Association of Oilwell Drilling Contractors
Phone: (403) 264-4311 ext. 120