US drilling in 2010 still well below elevated 2008 levels, says API

Houston (Platts)--11Jan2011/544 pm EST/2244 GMT

US oil and natural gas drilling in 2010 rose over the previous year but still remains "far" below the high-flying levels seen in 2008, according to the American Petroleum Institute's 2010 Quarterly Well Completion Report for fourth quarter 2010, released Tuesday.

In 2010, a total 37,892 wells were drilled, up 12% from 2009, but down almost 33% from 2008, API said in a statement.

For fourth quarter 2010, industry completed roughly 10,487 oil wells, natural gas wells and dry holes, the organization said. That is up 37% percent from 2009's fourth quarter, but still well below 2008 levels.

"While there was an uptick in drilling levels in 2010, the levels are still far below those of 2008," Hazem Arafa, director of API's statistics department, said. "As the nation continues to struggle with a weak economy, the oil and natural gas industry has shown that it is willing and able to increase production to meet growing energy demand and put people back to work."

API said oil well completion activity that began in the early 2000s continues with about 5,715 oil wells were drilled in the fourth quarter of 2010, up 65% from year-ago levels. API also reported that total projected footage drilled in the fourth quarter was 69.165 million feet, a 45% increase over fourth quarter 2009.

For most of the 2000s, natural gas was the primary target for US exploration and production activities. But in 2010, for the first time since 1996, the estimated number of oil wells drilled outpaced gas wells -- 19,451 to 14,324, noted API.

--Starr Spencer, starr_spencer@platts.com

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