Is the 2015 drilling forecast good or bad news?

The latest drilling forecast from the Petroleum Services Association of Canada (PSAC) released today shows even with the low price of oil, the number of wells drilled in 2015 is flat compared to 2014. This doesn't sound like something to celebrate, but let’s dig into the data more deeply.

In reality while well completions are declining, drilled meterage is increasing. There is a real benefit for drilling longer wells, especially from a sustainability point of view; with a longer well comes more production and a longer production duration. More oil or more time in one location may justify installing in situ water recycling, rather than using water from local sources. In addition at the end of production, a more programmatic decommissioning programme can be considered. There are a number of new remediation technologies that can be used such as in situ remediation which reduces the carbon footprint compared to dig and dump, and the risk to the local environment of all the trucks on the road. While the drilling predictions for 2015 suggest fewer completions, it is likely the longer wells will allow producers to do things more efficiently, and sustainably.