I wonder why. Is it something about opportunities? (Permian wells getting worse than expected and Bakken better than expected.) Or is it something to do with contracting? (More spot rigs in the Permian and more long term contracts, done when oil was in the $70s last year, in the Bakken.) Or maybe even just seasonality? (Why drop rigs in the summer when it's easier working conditions in ND.)
No strong opinion, just curious. If I had to bet it's more about the opportunity and more about the Permian, especially "fringe Permian" that was part of the frothy investor space underperforming versus Bakken overperforming. But idono.
Agree completely with this observation: too many factors to really make sense of it all. I'm mostly interested in the science of it all, the technology, the strategies for maximizing production. Unfortunately, early on, to better understand the Bakken I did have to "follow the money" which sometimes (often?) seems to be the focus of the blog.
I am slso fascinated with the working relationship between government and the non-government entities involved.
Rig counts? Don't even get me started. LOL.
Having said that: drilling in the summer/winter is not the issue. The issue is fracking. They can't frack in the coldest days/weeks of the winter. And spring weather affects trucks / road restrictions.
A much better metric than the number of operating rigs is the number of DUCs, inactive wells for operational reasons, and frack spreads.
If frack spreads are increasing and DUCs are increasing that speaks volumes. It tells me that, for whatever reason, drillers are completing wells even faster than getting them fracked.
If, on the other hand, DUCs are increasing, and THEN frack spreads stay the same or decrease, that is even more noteworthy.
I track DUCs and inactive wells at this post: http://themilliondollarway.blogspot.com/2018/07/update-on-ducs-july-14-2018.html.
I wonder why. Is it something about opportunities? (Permian wells getting worse than expected and Bakken better than expected.) Or is it something to do with contracting? (More spot rigs in the Permian and more long term contracts, done when oil was in the $70s last year, in the Bakken.) Or maybe even just seasonality? (Why drop rigs in the summer when it's easier working conditions in ND.)
ReplyDeleteNo strong opinion, just curious. If I had to bet it's more about the opportunity and more about the Permian, especially "fringe Permian" that was part of the frothy investor space underperforming versus Bakken overperforming. But idono.
Agree completely with this observation: too many factors to really make sense of it all. I'm mostly interested in the science of it all, the technology, the strategies for maximizing production. Unfortunately, early on, to better understand the Bakken I did have to "follow the money" which sometimes (often?) seems to be the focus of the blog.
DeleteI am slso fascinated with the working relationship between government and the non-government entities involved.
Rig counts? Don't even get me started. LOL.
Having said that: drilling in the summer/winter is not the issue. The issue is fracking. They can't frack in the coldest days/weeks of the winter. And spring weather affects trucks / road restrictions.
A much better metric than the number of operating rigs is the number of DUCs, inactive wells for operational reasons, and frack spreads.
If frack spreads are increasing and DUCs are increasing that speaks volumes. It tells me that, for whatever reason, drillers are completing wells even faster than getting them fracked.
If, on the other hand, DUCs are increasing, and THEN frack spreads stay the same or decrease, that is even more noteworthy.
I track DUCs and inactive wells at this post: http://themilliondollarway.blogspot.com/2018/07/update-on-ducs-july-14-2018.html.