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No one is chanting “Drill, baby, drill,” but US operators are doing just that, extending their strong run in 2010 to 2011 as they take advantage of sustained high oil prices. Drilling activity is booming in liquids-rich shale plays such as the Bakken and the Eagle Ford, as well as in conventional oil and gas regions like the Permian basin in West Texas and Oklahoma’s Anadarko basin. Offshore drilling activity is returning to the Gulf of Mexico, though not at the pre-Macondo levels in either the shallow or deepwater blocks. Canadian drilling activity is also expected to increase. The Petroleum Services Association of Canada (PSAC) has predicted that 12,950 wells will be drilled in 2011, representing a 5.7% increase from 2010. In Mexico, where the economics of drilling activity are intertwined with government policy, drilling activity is down so far in 2011, but with an increased emphasis on exploration.
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