The U.S. rotary rig count was unchanged at 1,769 for the week of May 17, 2013. It is 217 rigs (10.9%) lower than last year.
The number of rotary rigs drilling for oil was down 4 at 1,408. There are 40 more rigs targeting oil than last year. Rigs drilling for oil represent 79.6 percent of all drilling activity.
Rigs directed toward natural gas were up 4 at 354. The number of rigs currently drilling for gas is 246 lower than last year's level of 600.
Year-over-year oil exploration in the U.S. is up 1.9 percent. Gas exploration is down 41.0 percent. The weekly average of crude oil spot prices is 1.7 percent higher than last year and natural gas spot prices are 59.4 percent higher than last year.
Canadian rig activity is up 5 at 123 for the week of May 17, 2013 and is equal to last year's rig count. The number of rigs drilling for oil was up 5 at 70 and is 6 (7.9%) lower than last year. Gas directed rig count was unchanged at 53 and is 6 (12.8%) higher than a year ago. Canadian drilling falls rapidly in the spring to avoid environmental damage moving drilling equipment during the spring thaw and rainy season. With wide weather related seasonal swings, even year-over-year comparisons can lead to incorrect conclusions.
Down the road, this piece of data will be +/- 20% less important as ftk is diversifying its source of revenues and becoming less dependent to the ebbs and flows of the OIG industry. Nevertheless, Canada picking up is great as it was the main source of weakness in the past quarters. Natural gas pricing may be an additional positive for 2013 and beyond.