January 7, 2019
Frack jobs peaked in May/June
Shale fracking activity in the US likely dropped to 44 jobs per day in November 2018, Rystad Energy’s analysis of preliminary data suggests.
We conclude that nationwide fracking activity was mostly stable from April 2018 to August 2018 at an average daily level of between 48 and 50 fracked wells. However, the fracking rate has slipped to a range of between 44 and 46 for the period of September to November 2018.
“After reaching a peak in May/June, fracking activity in the Permian Basin has gradually decelerated throughout the second half of 2018,” says Rystad Energy senior analyst Lai Lou.
“Looking at preliminary data for November, we see evidence that seasonal activity deceleration has likely started in all major plays except Eagle Ford,” Lou adds. “There has been a considerable slowdown in Bakken and Niobrara in November, our analysis shows.”
The latest FracFocus update, a national US database, was released on January 1. It provides considerable visibility on fracking operations across the US in November 2018, yet the uncertainty range for the month remains significant, as indicated by the figure above.
Some major operators in the Permian are bucking the general slowdown trend. The largest operator, ExxonMobil, experienced a strong uptick in October, making it one of the months with the highest number of fracked wells in the second half of 2018. Likewise, Energen Corporation was not affected by the slowdown prior to its formal acquisition by Diamondback Energy in November 2018.
“In general, many of the key operators have exhibited a largely flat trend from June to October 2018, which implies that the market-wide deceleration in fracking activity has a more significant implication for small companies in contrast to the major players in the Permian,” Lai said. October and November 2018 are still exposed to some underreporting. “Based on the latest reporting, the reduction in the collective number of jobs for the top 10 operators is around 10% from June to October, while the corresponding percentage for the remaining operators is as high as 48%.”
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