Soggy southern Saskatchewan welcomes back oil rigs

Western Investor
October 14, 2011

Receding flood waters have allowed drilling rigs to ramp up production in the southeast Saskatchewan oil patch, with about 50 rigs active near Estevan, Stoughton and Weyburn.

“Some operators, I heard, got out to do their checks in a boat,” said Roy Schneider, a spokesman for the Ministry of Energy and Resources from their Regina office.
“Some wells were sandbagged and operators boated over but really, we haven't received any reports of anything untoward affecting wells this spring and summer, no major problems on the production side,” said Schneider.

 Dean Pylypuk, superintendent of operations for Energy and Resources out of their Estevan office, said there has been a good three-month delay in production numbers coming out of the southeast, which means that the lower volumes are just now starting to surface at the provincial levels. 

“In other words, the flood numbers are just coming in now,” he said. Spring floods led to a massive release of reservoir water from the Rafferty and Boundary Dams in early June, which pretty well put the oil patch on the shelf for another month. This was usually a period in which the industry is going full bore following the typical modest three to six week spring road ban season. 

The Petroleum Services Association of Canada (PSAC) now forecasts that drilling activity in Saskatchewan is heading for a 17 per cent increase this year, floods or no floods. It is now predicted that Saskatchewan will be able to drill 3,273 wells this year, according to PSAC. The rig utilization rate in Saskatchewan is the highest in Western Canada, noted Schneider, at 69 per cent. Of the 1,329 wells drilled in Saskatchewan, 1,305 were seeking oil while only 24 were going for natural gas. 

“Unless we see a dramatic price shift, I don't see that ratio changing,” said Schneider. 
“There is a whole bunch of nice sweet crude still sitting in the Bakken down there and they'll still go after it and the numbers show that the water hasn't severely impacted overall production ... yet. It seems we're still in positive shape across the province and once we get the southeast back to full stream again, it could well be a banner year.” 

See a spotlight report on Weyburn in the November issue of Western Investor. 

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