By Matt Grossman
Dawson Geophysical Co. said Thursday that oil exploration and production activity bottomed out in the second quarter as companies in the sector remained cautious about capital spending.
On the oil:
“Exploration and production companies continue on the path of capital discipline, focusing on shareholder returns and keeping expense levels below cash flow. increased only slightly, as many E&P companies have part of their production hedged well below spot prices. “
“That said, despite the recent decline in oil prices in response to OPEC + ‘s announcement of increased production quotas, as well as uncertainty over the effects of the COVID-19 Delta variant on the overall economy, there continues to be a modest improvement in petroleum service activity. “
“The number of US platforms, which typically precedes the deployment of seismic data acquisition, is currently 491, showing gains in five of the past six weeks and an increase from 247 a year ago , but well below the levels seen at this time in 2019 of 918. “
“The same goes for the hydraulic fracturing fleets with a current number of 235 active crews, above 70 a year ago but well below 366 crews this time two years ago. “
On the business outlook for seismic data acquisition:
“While the current conditions in the seismic data acquisition market remain difficult and are expected to remain so in the months to come, we are encouraged by the overall improvement in the economy and the petroleum services sector. “
“The recent increase in drilling and completion activity, combined with hedging contracts that will eventually unwind, paves the way for a successful recovery in the seismic data acquisition industry.
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