Record Numbers of Oil & Gas Wells Frac'ed and Frac Stages Will Have Significant Impact on Demand across the North American Oilfield Services Market

HOUSTON, Aug. 6, 2014 /PRNewswire/ -- PacWest Consulting Partners is pleased to announce the release of its latest report – WellIQ.  WellIQ provides a detailed analysis and forecast of drilling & completion (D&C) activity in North America, with regional analysis of rig counts, well spuds, wells frac'ed, frac stages, drilling days/well, and multi-well pad penetration for the US and Canadian markets.  Due to its comprehensive scope, the upstream oil/gas industry has quickly adopted WellIQ as its "Oilfield Activity Barometer," and it has become the leading measure of D&C activity. 

As published in the latest release of WellIQ, PacWest forecasts robust D&C activity in the North American market through 2016.  PacWest forecast that wells drilled/spud will increase by 6% in 2014 and 2% and 3% in 2015 and 2016, respectively. PacWest expects that the number of HZ wells frac'ed in North America will increase by 9% in 2014, 14% in 2015, and 11% in 2016.  Additionally, it expects that the number of HZ frac stages completed will increase by 19% in 2014, 19% in 2015, and 16% in 2016.  These forecasts reflect a robustly growing market for oilfield service providers.

The impetus for the WellIQ report was the need for a better set of metrics to track D&C activity for the North American market.  Rig count has been the traditional metric of choice to measure oilfield activity, but due to rapid increases in drilling efficiency and a substantial decrease in the number of rigs required, rig count does not accurately reflect the true status and trajectory of D&C activity.  The WellIQ report fills this gap in market research. 

PacWest firmly believes that the best metrics to measure D&C activity in the North American oilfield are the number of wells drilled, wells frac'ed, and the number of frac stages completed by trajectory.  Due to rapidly changing pad drilling penetration and well parameters, the service intensity of individual wells may vary dramatically, even in the same play.  Tracking horizontal (HZ) frac stages provides a much clearer picture of the total amount of completion activity and the volume of 3^rd party spend. 

 "The implications of our latest outlook on oilfield services and equipment moving forward will be significant," says PacWest Partner, Christopher Robart.  "The next several years are forecast to be strong for most all oilfield services and equipment players; however, the challenge will be within the supply chain.  The winners will be the companies who can manage the logistics and risks around having the right personnel, services, materials, and equipment, at the right place, when it is needed on-site by their E&P customers."

When we look at the figures regionally, PacWest finds that a small number of plays are responsible for much of the growth in the market.  Oilfield service and equipment providers focused in those plays will be poised for the strongest growth.  PacWest expects four plays to account for 77% of 2014 growth HZ frac stages in the US Land market – Bakken, DJ Basin, Eagle Ford, and Permian.  Market growth in Canada is even more concentrated regionally, with four plays expected to account for 92% of 2014 growth in HZ frac stages – Cardium Duvernay, Montney, and Viking.  Refer to the tables below for more detail. 

PacWest will hold a conference call on Thursday August 28, 2014 at 9:30am CST to discuss these and other views on the market. Call details are provided below. The call is open to the public.

Conference Call:
Dial-in: +1 (800) 830 3581  
International Dial-in: (262) 320 4698
Conference ID: 5284959

Presentation Link:
https://join.me/PacWest_Market_Update

For more information, contact Jennifer Thomas, 713.929.3285, [email protected]

SOURCE PacWest Consulting Partners