The number of drilled but uncompleted wells (DUCs) that accumulated at the height of the pandemic has already subsided to pre-COVID-19 levels in the US, according to a Rystad Energy analysis.
After swelling to a multi-year high of 6,548 wells in June 2020, the number of such wells in the country’s major oil regions slimmed down to around 5,700 wells by the end of December 2020.
The inventory of live DUCs, which excludes tentatively abandoned wells drilled a long time ago, also declined by around 800 wells in the same period, from 4,353 in June to 3,528 in December. The current level of horizontal oil live DUC count is comparable to the level seen in early 2020, just before the market downturn started.
“Given the recent recovery in oil prices, the industry is enjoying the flexibility of further accelerating fracking activity beyond current levels in the first half of the year. Such an acceleration could be delivered, as can be implied from the ratio of the current live DUC inventory to the run rate of fracking, which is still in the six-to-eight-month range, compared to the normal level of about three months seen in 2018-2019,” said Artem Abramov, head of shale research at Rystad Energy.
As of 21 January 2021, it identified 626 started frac operations in North America for December 2020 and it expects the month’s fact-based coverage to be almost complete. For January 2021, Rystad predicts that there will be 830 wells fracked, the highest monthly total after March 2020, when the COVID-19 induced downturn began.
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