Mid-Continent / Granite Wash / Shale Daily / Drilling Rig Count in Unconventional Basins

Granite Wash Left With Four Rigs in Ongoing Driller Exodus

One-dozen U.S. land rigs left play for the week ending April 1, joined by two offshore units for a decline of 14 to 450 operating U.S. rigs (including 420 land-based units), according to Baker Hughes Inc.

Ten oil-directed rigs left U.S. activity, joined by four gas units. Three of the departing rigs were directionals, 13 were horizontals, but two vertical rigs returned to activity in the United States, Baker Hughes said.

The biggest loser among states was, again, Texas, but the Granite Wash of western Oklahoma and the Texas panhandle was the biggest loser among plays, taking a spot usually held by the Permian Basin or the Eagle Ford Shale.

The Granite Wash lost four rigs to end the week at four active. That's down from 23 active rigs one year ago. Gas in the Granite Wash tends to be liquids-rich, with natural gas liquids and condensate typically accounting for 30-40% of well production. Just below the Granite Wash is the Atoka Wash, which has five intervals of its own but is more of a dry gas formation. Above the Granite Wash are several oilier intervals, most notably the Tonkawa, Cleveland, Hogshooter and the Marmaton, according to NGI's North American Shale & Resource Plays 2016 Factbook.

In Canada, six natural gas-directed rigs left while all of the previous week's operating oil rigs remained. At week's end, there were 49 rigs running in Canada. That made for a decline in North American rigs of 20 units to rest at 499 operating.

The Railroad Commission of Texas (RRC) released its preliminary production numbers for January, which will be revised later (most likely upward) as more data is reported to the commission.

Preliminary January production was 76.06 million bbl of crude oil and 612.60 Bcf of natural gas from oil and gas wells. Production reported to the RRC for the same time period last year, January 2015, was 68.95 million bbl of crude oil (preliminary), updated to a current figure of 88.82 million bbl; and 607.63 Bcf of total gas (preliminary), updated to a current figure of 733.12 Bcf.

In the last 12 months, Texas production was 1.014 billion barrels of crude oil and 8.3 Tcf of total natural gas. Crude oil production reported is limited to oil produced from oil leases and does not include condensate, which is reported separately.

Texas production in January came from 182,212 oil wells and 89,559 gas wells.

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