Drilling forecast improves based on brisk activity at the close of 2013
The Petroleum Services Association of Canada has upgraded its industry outlook for 2014, due in part to brisk drilling activity in Central Alberta late last year.
The national trade association, which represents the service, supply and manufacturing sectors within the upstream petroleum industry, said Thursday that it’s now anticipating there will be 10,930 wells drilled in Canada this year.
That’s 130 more than PSAC was predicting as of Oct. 30, 2013, but a 1.5 per cent decrease from the 11,097 wells drilled and released in 2013.
“We are adjusting our numbers slightly upward due to stronger-than-expected activity levels at the close of 2013, specifically in Central Alberta and various regions in Saskatchewan,” said Mark Salkeld, PSAC’s president and CEO, in a release.
“Still, our forecast remains pretty constant year-over-year because we are seeing a continuing trend towards multi-well pads with multilateral and more complex completions, and we expect this trend to continue even beyond 2014, given that advances in technologies are making such wells more logistical and economical for the producers.”
PSAC is forecasting an Alberta well count of 6,642 this year, which marks an 87-well increase over the figure it announced in October. Saskatchewan is expected to produce 3,229 wells, up 33 from the earlier forecast; while in British Columbia the tally is now anticipated to hit 560, an increase from the previous number of 550. Manitoba is expected to add 480 wells, which is unchanged.
About 85 per cent of the wells drilled this year will be oil-focused, said PSAC. That percentage has been consistent in recent years.
The updated forecast is based on average natural gas prices of C$3.50 per thousand cubic feet, oil prices of US$95 a barrel for West Texas intermediate crude, and a Canadian dollar trading at US$0.95.
PSAC represents nearly 250 member companies, with these employing approximately 70,000 people and contracting almost exclusively to oil and gas exploration and production companies.