ODESSA, Texas (BIG 2/ FOX 24)- “Big oil companies that are out here drilling have scaled down their plans from what they have probably earlier in the year and especially from last year,” says CEO of Latigo Petroleum Kirk Edwards.
According to Baker Hughes Rig Count, there are currently 802 active rigs which are 274 less than this time last year.
“We’re seeing the rig count drop here in the Permian Basin but that’s probably in the long term very good news for us because there is a big oversupply of oil in the market and natural gas so it’s going to give the pipelines some ability to catch up,” says the CEO.
Some, however, are worried as the slow down is leaving more and more people without jobs.
Edwards says this is because “in the last few years they’ve been drilling way out of their cash flow, just getting out there and drilling as much as they could, since they have slowed down they don’t need quite as many people as they did before so you are seeing some people get laid off here towards the end of the year.”
People still wondering if we’re headed for a bust. Edwards saying that although things are slowing down he wouldn’t categorize it as a bust.
“If the oil price stays in the 50’s and higher it’s going to be very good, steady, drilling for those companies ahead.”
The Houston Chronicles reporting Friday morning that West Texas has fallen by $1.56. Putting the price per barrel at just over $56. As for 2020, Edwards anticipates it looking similar to this last quarter.
“I think the rig count probably won’t move as much as it has this year I doubt we’ll lose too many more rigs I think every one is getting back into their normal cycle of the number of wells to drill and things like that.”