For the week ending August 23, Baker Hughes reported that the Western Canadian gas-directed drilling rig count was unchanged at 66 (blue line in left hand chart below) and eight less than a year ago. For the oil-directed drilling rig count, it rose two to 149 (red line in right hand chart), 34 more than a year ago, 14 above the top end of the five-year range, and is at its highest level since March 2023. The lack of change in the gas rig count reflects the intentions of numerous gas-levered producers that have announced deferrals to drilling programs and are unwilling to commit to higher activity as a result of very weak natural gas prices. The strong oil rig count underscores producers’ desire to further expand production, primarily heavy oil and oil sands related, and capitalize on additional egress capacity provided by the Trans Mountain Pipeline expansion.
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- Analyst Insight
Canadian Drilling – Oil Rig Count Holding Strong, Gas Rigs Dull as Dishwater
The Canadian oil rig count remains strong and well above the five-year average range. More pipeline capacity and solid oil heavy oil prices continue to incentivize oil drilling, especially in the oil sands. Gas rigs remain dull, unable to break out to the upside as gas producers continue to hold back activity in the face of very weak gas prices.
- Analyst Insight
Canadian Drilling – Oil and Gas Rig Counts Little Changed
Canadian drilling was little changed in the latest week. Gas drilling has shown little movement for months in light of extreme weakness in natural gas prices. Oil drilling remains above the five-year range.
- Analyst Insight
Canadian Drilling – Oil Rig Count Holds Strong, Gas Rigs Backing Down
Canada's oil-directed drilling rig count punched to its highest level since February 2023, while the gas rig count fell back, likely reflecting activity curtailments in response to extremely low gas prices this summer.
