Have you ever seen an oil rig walk?
Some of the newest rigs can travel hundreds of yards to the next well under their own power, lurching along like 150-foot-tall robots on hydraulic legs that raise the equipment five inches at a time, nudging forward at about a foot per minute. While that sounds slow, it is faster and cheaper than dismantling a rig and trucking the parts to a new site nearby.
More efficient drilling rigs that cost a third less than just a year earlier are changing the face of the U.S. shale industry, helping boost per-rig output in the four largest fields by at least 40 percent since the crude price plunge began in 2014. While helping producers pump more oil, the new rigs have a downside. Companies such as Helmerich & Payne Inc., Nabors Industries Ltd. and Patterson-UTI Energy Inc. that provide the equipment face investor concern that the improvements they’ve made might translate into fewer sales in the future.
Producers “are being incentivized to continue drilling to keep cash coming in the door because costs have come down so much,” Rob Desai, an analyst at Edward Jones in St. Louis, said in a telephone interview. “Even though the rig count is down by half, you can do more with the half that’s still working.”
U.S. Production per rig is up 40% since the crude price plunge.
Good news! Perhaps I was right that traders at the end of month had to settle their bets kicking up the price. Well, it kicked back down today. Gasoline is down by 7.60 cents/gallon at the average rack in Selma. Diesel fuel plummetted by 10.27 cents/gallon. Crude dropped an unbelievable $3.55/barrel to $44.12, probably headed back below $40, especially since it looks like the Iran deal will happen and Iran starts pumping oil into the world glut. Cartels only work if there is a limit to supply. This cannot happen when each country is fighting for market share. Good for us! The country is onthe verge of its third BOOM driven by oil. In just my little world here, our office, I hired an employment agency aout two weeks ago to find Sidney an assistant. I called the young lady at the agency back and she reports everyone has a job. Everytime they call back an applicant, they already have a job. If you know any one good who could work as Sidneys office assistant, taking the phone orders and putting into our Cloud Dispatch program, then have them call Sidney. Thank you.
Have a great day,