RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:NR Thoughts.Companies in Canada got smarter.
They were hiring tons of labour and equipment to drill marginal locations pre covid.
Lots of saskatchewan oil wells produce 10 barrels of oil after a year.
Saskatchewan drilling has been very low and I dont think it is equioment or manpower that is issue...well economics....reserves are low per well. Look at some of Gear energy wells as an example.
My point is...pouring tons of capital into Sasketchewan oil plays wouldnt increase canada production much....even if equipment and people were avaible. Companies were making pour decisions in the past.
Capital allocation and return are driving things more.
The best people and equipment are going to the best plays that grow easy...Montey and Charlie Lake., etc.
Look at the rigs that left Canada for the States. Permain Basin is going too attract equipment, people, and capital cause wells and reserves are so much better then elsewhere.
Why it is growing....majors don't f*ck around with marginal 75-125 barrel oil wells in Canada.
Lots of permain wells have a 1 million barrel plus reserve.
You could get 50 extra single rigs drilling in sask and what is it going to do to overall production...an intial flush but not material.
As long as new Permain wells come online at gusher rates....growth isnt going to stop here as companies are throwing as much resources as possible to this play.
Or in Canada...Montney and Charlie lake are growing each month cause it is easy to grow with strong wells.
Bakken and viking in Sask is a waste of time. Some juniors can ekk out a 1000 per day oil increase over a year but it is a truggle and a waste of resources.
I mean what Canadian ol and gas company isnt at thier pre covid production level?
Almost all are because they are allocating capital better.
Running out of sweet spots locations will be a bigger issue in time then manpower or steel or equipment.
I just feel Permain is such a new play that it wont struggle with sweet spots until sometime in 2025-2030....
perstrudent wrote: I worked for one of Canadas big service companies for 13 years so have a ton of friends that worked in the industry..a good portion east coasters...All companies advertising hard for employees..Id say 10% of these people are returning to the oilfield...the rest still say screw it after the past decade..The pay isnt worth it vs local trucking jobs, construction jobs etc...maybe that will change..but I havent seen it yet..
Of course efficiency at all time high..you had companies lay off theire worse employees through covid and park and idle their worse machinery. So you had concentrated the best all star crews with newest best equipment least likely to break down.
To expand you now need to dillute those exisiting allstar crew with new employees...from what I hear are straight out of Mcdonalds at best..Class 1 license that much harder to get after humbolt crash than even few years ago...Graveyard equipment has to brought out of idle assets but again this will decrease efficiencies as more breakdowns less reliable.
Permian yes has lots of pipeline capacity but also has a major water disposal issue on its hands. I worked for a water management company final couple years in the patch and so hearing lots of interesting stuff about their permian division...good for them...but going to throttle the growth down there...
Again not saying I dont see some growth but not 1 million by year end...Ill be shocked if we hit 500k more my year end...
Always little hickups along the way..the bakken just took a direct hit of 2 to 3 feet of snow...going to see drop there for a couple weeks to recover from that storm...a lot is pipeline but still a lot is halted there currently