The linked article reflects on a Yahoo!Finance story:
We were intrigued to read a Yahoo! Finance headline a week ago Friday that the domestic drilling rig count was "falling off the cliff." The headline was attached to an article discussing the year-end report of the weekly Baker Hughes tally of various drilling rigs working in the oil patch. The article went on to discuss the trends among the various categories of drilling rigs that Baker Hughes reports – oil, gas, other, total, horizontal, directional and vertical. We understand that writers of news articles, especially those posted on news' websites, often become flamboyant with their headlines in order to draw readership. Still, "falling off the cliff" struck us as an over-the-top assessment.The article provides some nice background and ends with this:
So while the Yahoo! Finance headline writer may think the decline in the rig count over the past few months is like going over a cliff, we suggest he should measure activity against the pattern during the financial crisis. That's a pattern we would call "falling off the cliff." Let's hope we never see that magnitude of an industry contraction again, although based on the history of the oil and gas business, it will re-occur sometime.In between the first and the last paragraphs, the writer mentions the Bakken.
I have my own thoughts on all this, but I could never "compete" with an energy investment banker, so I will let the writer have the first word AND the last word.
For newbies:
- max number of active rigs in North Dakota in the current boom: 218
- current number of active rigs in North Dakota: 185
- assumption: 10 ND rigs now moved to the Montana side of the state line but still in the Bakken
- three companies, once "busy" in the Bakken have either cut back or suggested they will cut back on drilling
- others can do the math
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