There are indications that many oil and gas companies have increased investment in exploration and production, despite the current lull in the international market. Baker Hughes disclosed in its latest report that the international rig count for May 2017 was 957, up 1 from the 956 counted in April 2017, and up 2 from the 955 counted in May 2016.
It indicated that the international offshore rig count for May 2017 was 202, up 1 from the 201 counted in April 2017, and down 27 from the 229 counted in May 2016.
According to the company, the average U.S. rig count for May 2017 was 893, up 40 from the 853 counted in April 2017, and up 485 from the 408 counted in May 2016. It stated that the average Canadian rig count for May 2017 was 85, down 23 from the 108 counted in April 2017, and up 43 from the 42 counted in May 2016.
The company pointed out that the worldwide rig count for May 2017 was 1,935, up 18 from the 1,917 counted in April 2017, and up 530 from the 1,405 counted in May 2016.
The Baker Hughes Rotary Rig Counts are counts of the number of drilling rigs actively exploring for or developing oil or natural gas in the U.S., Canada and international markets. Baker Hughes has issued the rotary rig counts as a service to the petroleum industry since 1944, when Hughes Tool Company began weekly counts of the U.S. and Canadian drilling activity.
Mr. Bala Zaka, a Port Harcourt-based industry analyst, disclosed that the increased investment would impact positively on the industry and economy of nations.
He stated that it would enable operators to make commercial oil and gas finds, thus leading to increased reserves in the coming years. Zaka said that huge reserves would also make it possible for companies to meet rise in future demand.
Mr. Abiodun Adesanya, president of the Nigerian Association of Petroleum Explorationists, NAPE, disclosed that the relatively low price of oil should not discourage investors from investing in exploration and production.
He stated: "The issue is not about low oil price, but low profit margin. If the issue is that your profit margin is eroding, it's a bad business to be in.
"Rather than over-concentrate on the oil price, work on your profit margin. Call your contractors and bargain on reducing costs of producing oil so that there will be enough margins between cost of production and sales cost," he added.