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Drilling rig counts down to start the year

Drilling rig counts down to start the year

Posted on: 3/5/2019 | Author: ATB Financial's Economics + Research Team

​​The latest active drilling rig numbers suggest Alberta’s energy industry could experience yet another frustrating year. The average number of rigs over the past 12 months is approximately 7 per cent lower than the previous 12 month period.

According to the Canadian Association of Oilwell Drilling contractors (CAODC), the average number of active drilling rigs in February was 144. This is down 3 per cent from the previous month and 34.2 per cent from the same month one year earlier. Meanwhile, the number of rigs that were sitting idle grew 18.2 per cent over the same period.

Analyzing rig counts is just one metric that helps guide projections surrounding the province’s energy sector. Other metrics include examining exploratory and developmental drilling numbers, watching the futures markets and following the latest production and storage numbers. When these factors are taken into account, a clearer picture emerges.

In the case of Alberta, the potential for growth in the province’s energy sector will continue to be curtailed, at least until prices move higher and the lack of pipeline capacity is addressed. But, with the completion of the Line 3 pipeline project delayed until 2020, Alberta’s energy industry is having a tough start to 2019.

Active drilling rigs, graph

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