• 2 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 5 minutes Middle East on brink: Oil tankers attacked off Oman
  • 8 minutes CNN:America's oil boom will break more records this year. OPEC is stuck in retreat
  • 5 hours Here We Go: New York Lawmakers Pass Aggressive Law To Fight Climate Change
  • 5 mins The Inconvenient Truth Of Electric Cars
  • 3 hours Iran downs US drone. No military response . . Just Completely Destroy their Economy. Can Senator Kerry be tried for aiding enemy ?
  • 3 hours Oil Demand Needs to Halve: Equinor
  • 7 hours Ireland To Ban New Petrol And Diesel Vehicles From 2030
  • 5 hours Magic of Shale: EXPORTS!! Crude Exporters Navigate Gulf Coast Terminal Constraints
  • 2 hours Solar Panels at 26 cents per watt
  • 8 hours NATO Article 5: Attack on one member is attack on all. Members all must come to defense . . . NOT facilitate financial transactions to circumvent and foil US Sanctions. Somebody please tell Angela.
  • 7 hours Is $60/Bbl WTI still considered a break even for Shale Oil
  • 8 hours Wonders of Shale - Gas, bringing investments and jobs to the US
  • 4 hours Hydrogen FTW... Some Day
  • 3 hours Section 232 Uranium
  • 50 mins Huge UK Gas Discovery
  • 4 hours The Plastics Problem
  • 49 mins Green vs. Coal: Bavaria Seeks Fast-Track German Coal Exit in Snub to Merkel Plan
Alt Text

Are Oil Prices About To Bounce Back?

Money managers have gotten increasingly…

Alt Text

Oil Markets Ignore A World On The Brink Of War

As tensions continue to rise…

Alt Text

Philadelphia Refinery Explosion To Boost Gasoline Prices

The explosions at the Philadelphia…

Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Trending Discussions

Oil Rig Competition Flares Up Amid Permian Boom

Surging U.S. oil production on the one hand, and the exploration and production companies’ focus on keeping costs in check on the other, have prompted drilling rig makers to shift their technology offering to solutions for increased productivity.

The largest U.S. rig fleet owners and operators are looking to secure contracts as the U.S. oil rig count continues to increase, which, as of last week, stood at 804 active oil rigs—up by 152 rigs compared to this time last year. So far in 2018, the oil and gas rig count in the United States has increased by 71 rigs.

National Oilwell Varco (NOV), for example, is offering upgrade kits for some of its rigs that are already in the field. The upgrade kit extends lifecycle and utilization of existing iron roughneck and increases torque magnitude to meet the emerging rig application demands associated with longer lateral wells, according to NOV. And it’s this very kind of efficiency improvement that may separate the winners from the losers.

If the downturn taught drillers nothing else, it taught them to tighten their belts—to squeeze every last drop from what they already have. Gone are the loosey-goosey days of $100 oil. Drilling longer laterals is one of those ways that U.S. companies use to squeeze more oil from the rocks, by supersizing fracking, alongside with using more frac sand.

A 15-percent increase in the length of laterals last year was a significant driver for super-spec rig demand, Helmerich & Payne said in January, noting that it expects this trend to continue.

“H&P has over 40% of the active super-spec rigs and with that portion of the industry fleet fully utilized we believe pricing should continue to improve. We also have a significant advantage for future growth as we have roughly half of the 200 to 250 upgradeable rigs available in the U.S. market today that could be readily upgraded to super-spec capacity,” President and CEO John Lindsay said. Related: China Prepares Death Blow To The Dollar

Helmerich & Payne has also acquired digital drilling solutions providers Motive Drilling Technologies and MagVAR, and expects demand for their offerings to rise as the importance of wellbore accuracy grows with longer laterals and tighter well spacing.

The rig providers are increasingly using and offering digital solutions, data analytics, and advanced computing to win more customers as U.S. drilling activity and production is expected to continue to grow, at least in the next few years.

Oilfield rigs and services provider Patterson-UTI Energy, for example, said last month that it had bought directional drilling analytics company Superior QC—a provider of software used to improve the accuracy of horizontal wellbore placement.

Nabors Industries reported an increased rig fleet in U.S. land drilling for 2017 with increasing margins, and expects the rig market to continue to improve in the coming quarters. Nabors bought last year Norway-based Robotic Drilling Systems AS, a provider of automated tubular and tool handling equipment.

“The robotics and rotary steerable operations are still in the product development stages but are expected to see improving results in 2018 as they enter the commercialization phase of their principal products,” Nabors said at the end of February.

Related: Man-Made ‘Magma’ Could Plug Leaking Abandoned Oil Wells

According to Wood Mackenzie, the pace of U.S. tight oil production growth in the coming years will depend on how drillers and oilfield service providers can overcome the ‘geology vs. technology’ constraints. The next few years will show if technological achievements can help companies to extract more oil cost-effectively from areas outside the sweetest spots in the Permian and other main U.S. shale plays.

For example, technologies to make microfractures to get to the most productive zones of the rock, as well as digitalization that will help all fracking stages from planning to execution, will be the main drivers that could boost production growth, Wood Mackenzie’s Lower 48 Upstream Research Director Jonathan Garrett said. On the flip side, there is a risk that wells too close to one another could produce more water or show a massive drop of pressure. Overall, WoodMac sees the Permian and U.S. tight oil peaking somewhere in the middle of the next decade.

Until that peak comes, U.S. production will continue to grow, and rig makers and owners will try to seize the opportunities to grow their U.S. land fleets, day rate incomes, and profit margins.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News