L48 Land Rig Count – Back above 700 in 2024

L48 land rig count expected to climb back above 700 to meet 2024 drilling projections.

Based on Kimberlite’s most recent drilling services industry study, the US land well count is projected to increase 2.9% in 2024 versus 2023 and at current levels of drilling efficiencies rig count will need to increase ~80 rigs from current levels to hit fiscal year 2024 growth expectations.

While growth in US land is moderating following 2 years of solid expansion in 2021 and 2022, activity levels remain healthy and the moderation in growth is allowing both OFS suppliers and operators to focus on operational excellence, execution, maintenance, training, and safety.

2022 was marked by adding over 150 drilling rigs in US land during H1 2022 in response to elevated oil prices and a call for oil and natural gas to support Europe. By contrast, 2023 was marked by dropping over 100 drilling rigs H1 2023 due to lower natural gas prices, economic uncertainty, and softening of oil prices.

YTD through July 2023 we have drilled nearly 12% more wells in 2023 versus 2022, but current lower rig levels and spud rates will end the year with only ~3% more wells drilled in 2023 versus 2022. This may be influenced, however, in Q4 if private operators pick up rigs in response to elevated oil prices. Stay tuned...

Kimberlite will continue to track the future expenditure plans among the operators worldwide and report updates. Feel free to reach out to discuss.