Canadian Drilling – Gas Rigs Near Steady While Oil Rigs Fall on Spring Break Up

For the week ending March 22, Baker Hughes reported a net decline of one for the Canadian gas directed rig count to 78 (blue line in left hand chart below) and also one lower than a year ago. For the oil directed rig count, it fell a steep 37 to 91 (red line in right hand chart) and five higher than a year ago. The latest gas rig count is at the top of the five-year range, as is the oil rig count. The latest downturn for oil and gas rigs is part of the annual spring “break up” period, a seasonal slowdown in activity associated with the end of the winter drilling season when ground conditions begin to thaw and which slows or prevents the movement of large heavy equipment such as drilling rigs in certain regions. Traditionally, this period affects oil rig counts to a much greater degree than gas rig counts.