When I look at the news coming out of the industry, it sure feels that we could see a pick up drilling. But we’ll only know that when we see Baker Hughes’ rig count tick up.
Here are some of the interesting occurrences:
- There has been an increase in the number of companies declaring bankruptcies in the past couple of weeks. These companies may want to clean up their books so they’re ready to start drilling as the price of oil continues to move up. Many of these companies expect to come out of bankruptcy quickly.
Companies making bankruptcy announcements in the last couple of weeks include:
- SandRidge Energy
- Linn Energy
- Berry Petroleum
- Penn Virginia
- Breitburn Energy Partners LP
- Exco Resource is exploring bankruptcy
- Companies could be looking to get deals done sooner rather than later. In just this past week, Range Resources purchased Memorial Resources Development and Vantage Resources outbid Rice Energy for Alpha Natural Resources 27,000 acres in Greene County, PA.
- I’ve been speaking with some Shale Directories members and some of them are seeing an increase in business activity. We have said that the Permian in West Texas would be the first shale play to see a pickup in activity. That seems to be happening.
The price of oil has hovered around $48 for the last couple of days. Many CNBC analysts expect oil to hit $50 in the next few weeks.