After peaking in early October, the rig counts for both the shales and the tights sands have drifted steadily downward. The lion’s share of the unconventionals’ decline has occurred in the gas-prone shales. Counterintuitively, however, much of the drop occurred among rigs drilling in the oil windows of these plays—a decline of 15 units sequentially in the latest biweekly comps by the latest Unconventional Drilling Report.

 

Another surprise recorded by the UDR was the collapse in the Eagle Ford, which gave up 14 units, split evenly between oil and gas. These losses were spread among a number of the operators in the play, a couple of rigs at a time. This is due likely more to coincidence of the float than to trend, given the immaturity of the play and the many locations still to drill. And the fact that the overall count and the Eagle Ford tally scarcely budged in comps of the latest Biweekly Report issues.

From the Biweekly Report with data as of November 19, 2010

On the other hand, the gas rig count lost relatively less ground than did the oil rig count in recent weeks.  For much of the year, it has seemed that macroeconomic trends were keeping the gas rig count from collapsing in spite of a physical supply/demand balance that warranted lower gas prices. Overdue recognition of the looming supply glut finally asserted itself in the 3Q, and a gas price slide followed suit. Now we’re seeing a modest bounce back in prices with the onset of colder temperatures. And the gas rig count slide seems to decelerate. Is a rebound in gas drilling in the offing? Not likely. The likelihood remains that in the months to come, gas drilling is attractive mainly if the driver is associated condensate and other liquids—or if it’s the irrepressible Marcellus. The gas rig count has added only about 100 units in total in the past year, and we can account for almost all of that gain with the major unconventional gas-prone plays. We also still think that the hunt for liquids is propping up much of the gas rig count. Except for the low-cost ...

Gulf Marine Fabricators, LP has signed a contract for the fabrication and integration of the topsides on a deepwater Gulf of Mexico project for an undisclosed customer.

 

Apache Corporation has selected OGN Group, a U.K.-based oil and gas engineering and fabrication contractor, to build a new satellite oil production platform for the UK Forties field. The new platform will be bridge-linked to the existing Forties Alpha installation.

Nabors Offshore workover jackup Dolphin 106 completed its four-well contract with Chevron late last week. Nabors has no follow-up work for the rig and has hot stacked it in Fourchon.

 

Posted inland barge Coastal Rig 22 is now moving onto location in South Marsh Island Block 212 to begin a 30-day workover with Chevron, on assignment from McMoRan E&P. The rig should return to McMoRan in early January 2011.

 

Jackup Hercules 120 has finished its current well in South Timbalier Block 37 for Chevron. The rig is now idle on location undergoing inspections and is expected back to work in about a week. Hercules’ contract with Chevron runs through 2010 with further contract extensions possible.

 

Seahawk Drilling has received a one-well P&A contract for previously idle jackup Seahawk 2001. Work in High Island Block A-1 will begin later this week and last for around 30 days. The rig is currently waiting on weather to move to location. The rig had been stacked since early November. Jacking system repairs on jackup Seahawk 3000 are now expected to be completed in mid-December, after which the rig will begin three contracts with Energy XXI, Badger Oil and Arena Energy. The ...

Noble Energy, Inc. updated its activity on the Leviathan exploration prospect offshore Israel. The well has penetrated the first natural gas interval in the primary objective. Final results from these drilling and logging operations are expected in mid-December. Noble Energy operates the Leviathan prospect in the Rachel license, with a 39.66 percent working interest. Other interest owners are Delek Drilling and Avner Oil Exploration with 22.67 percent each and Ratio Oil Exploration with the remaining 15 percent.

 

Apache Corporation reported that the Spar-2 appraisal well in Permit WA-4-R offshore Western Australia tested 58 mmcfg/d and 950 barrels of condensate per day. Apache’s Australia subsidiary plans to bring gas from the Spar Field and nearby Halyard Field to Western Australia’s domestic gas market via an existing Apache-operated pipeline 10 miles southeast of Spar-2 and through the Varanus Island processing and transportation hub.

BP, plc has entered into an agreement to sell its interests in Pan American Energy (PAE) to Bridas Corporation. PAE is an Argentina-based oil and gas company owned by BP (60 percent) and Bridas Corporation (40 percent). Bridas Corporation will pay BP a total of $7.06 billion in cash for BP’s 60 percent interest in PAE, which is expected to close in 2011. The sale of its interests in PAE is part of BP’s plan, announced in July 2010, to divest up to $30 billion of assets by the end of 2011, in part related to the Deepwater Horizon incident in the Gulf of Mexico.