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Oil and Gas Drilling in US in 2Q09 Fell 46% from Year Before
15 July 2009
Oil and gas drilling in the US in the second quarter of 2009 fell 46% year-on-year to an estimated 8,038 oil wells, natural gas wells and dry holes, according to the American Petroleum Institute’s (API) Quarterly Well Completion Report: Second Quarter.
This activity corresponds to levels in 2003-2004.
The estimated number of second-quarter exploratory oil and gas wells drilled plunged 63% from 2008 to 336 wells, while the number of second-quarter development oil and gas wells slipped 46% to 6,761 wells in 2009, the report found.
While natural gas continues to be the primary target for domestic drilling, with an estimated 4,225 natural gas wells completed in the second quarter of 2009, activity was down 43% from 2008’s second quarter, the most severe quarterly decline this decade.
Oil well completion activity, meanwhile, continued to subside, with total estimated oil well completions in second-quarter 2009 falling 53% below year-ago levels.
API also reported total estimated footage of 48.1 million feet drilled in the second quarter of 2009, a 53% decline from second-quarter 2008.
The US drilling decline that began last quarter in connection with the current downturn in economic activity has continued in earnest in the second quarter of 2009 as companies proceed with caution in an uncertain year.
—Hazem Arafa, director of API’s statistics department
July 15, 2009 in Brief | Permalink | Comments (8) | TrackBack (0)
Comments
Posted by: SJC | July 15, 2009 at 08:49 AM
They are waiting for the price to rebound.
Posted by: Mannstein | July 15, 2009 at 10:34 AM
Sjc its simple and obvious. They try and figure out the price per barrel needed to profit from extracting oil. Many areas have 150-200-250-500 buck barrel oil at this time. Perfectly fine for 2050 plastics and pharma needs but useless right now.
So they want more fields so they can try and find a sight with oil they can extract for less then what it sells for now. Thats why they want anwr its oil could be extracted for less then what oil costs now. same with some of the areas off the costs there are oil fields in them that likely could be extracted for less then 40 bucks a barrel.
Posted by: wintermane2000 | July 15, 2009 at 02:40 PM
Mannstein is right...there will be a flood of new drilling when the price starts to trend upwards again.
Posted by: ejj | July 15, 2009 at 06:11 PM
They did not drill when the price was over $100 per barrel. I do not think that price explains it. They wanted ALL the land they could get before the election, but refused to allow the provision that they must drill. They just want to lock up the leases and continue to import.
Posted by: SJC | July 15, 2009 at 08:31 PM
No again they want to find whats out there so they can plan ahead and gather the least costly sites first. You cant drill a 150 buck a barrel site unless oil is garanteed to stay well above 150 a barrel. They knew all along it wasnt going to stay high.
Also remember they only have so many rigs to use and many of those rigs simply are too expensive to operate on a small field.
Posted by: wintermane2000 | July 15, 2009 at 09:10 PM
"but why would you lease land for oil development when there was no oil there?"
$3-$4 an acre for leases thats why
Posted by: truthtopower | July 15, 2009 at 10:02 PM
"and many of those rigs simply are too expensive"
They can spend $1 billion for a deep water rig in the Gulf, but nothing for the millions of acres on land?
Something does not add up. When the chant was "drill baby drill" no one was asking the oil companies why they were not.
Posted by: SJC | July 16, 2009 at 08:14 AM
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There was talk about the 68 million acres under lease that the oil companies have not developed. Some said that there was no oil there, but why would you lease land for oil development when there was no oil there?
The oil companies wanted it all before the 2008 election and failed to get it. Now they just sit on the leases and do nothing while we spend 100s of billions of dollars for imported oil. The private sector does not always do what the nation needs to get done.