US rig count increases in 2008, but the trend won’t continue in 2009 ///

Last year started out with 1,749 rigs in the US, peaked in September with 2,014 rigs and finished the year with 1,782 rigs, giving an average of 1,878, which is a 6.2% increase for 2008. Looking at the monthly rig count, a sharp dropoff was seen beginning in December and continued into January, with rigs falling to 1,574 at the start of 2009. Last year we forecast an average of 1,854 for 2008, so we were off by 24. The rig count for 2008 grew the most in Texas, with a 64-rig jump to 844. North Dakota saw the largest percentage increase over 2007, running 74.4% more rigs in 2008. Over the past two years, US rig growth has slowed, and it appears to be at an end in 2009. Looking ahead, we are predicting the rig count to decrease 21.5%, to an average of 1,478 rigs by the end of 2009. Directional drilling of gas wells fell off toward the end of 2008, averaging 80.2% in the first half of the year and 78.5% in the second half, averaging 79.3% for the year. The gas/oil drilling split has remained stable over the past few years.

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