REFILE-UPDATE 1-US natgas rig count posts a 13-year low-Baker Hughes
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* Gas-directed rig count falls to lowest since August 1999
* Horizontal rig count drops for first time in four weeks
* Oil drilling rigs hit 25-year high after slight drop last week
NEW YORK, July 13 (Reuters) - The number of rigs drilling for natural gas in the United States fell this week to the lowest in 13 years as still-low gas prices prompted producers to further slow dry gas operations.
The gas-directed rig count notched its seventh drop in the last eight weeks, sliding by 20 this week to 522, the lowest since August 1999 when there were 510 rigs operating, data from oil services firm Baker Hughes showed on Friday.
The gas rig count is down 44 percent since peaking last year at 936 in October. The nine-month-long drop has fed expectations that producers were getting serious about stemming the flood of record gas supplies. (Graphic: r.reuters.com/dyb62s)
Baker Hughes also reported that horizontal rigs, the type often used to extract oil or gas from shale, fell for the first time in four weeks, dropping eight to 1,166.
But the horizontal count is still not far below the all-time high of 1,193 hit seven weeks ago.
Dry gas drilling has become largely uneconomical at current prices, but drillers have moved rigs to more lucrative shale oil and shale gas liquid plays which still produce plenty of associated dry gas that ends up in the market after processing.
Rising output from shale has made it difficult to slow overall dry gas production.
OIL DRILLING HITS NEW HIGH
The oil drilling rig count rose by 8 this week to 1,427, a 25-year record.
There were 41 percent more rigs drilling for oil this week than a year earlier when 1,013 rigs were operating in the country, Baker Hughes data showed.
GAS PRODUCTION STILL NEAR RECORD HIGHS
While gross U.S. gas production has slowed slightly from January's record peak, output is still flowing at near all-time highs despite the sharp decline in dry gas drilling.
In its July Short-Term Energy Outlook on Tuesday, the Energy Information Administration said it expected U.S. marketed gas production in 2012 to rise by 4.2 percent to a record 68.98 billion cubic feet per day, easily beating last year's record of 66.22 bcf daily.
The Baker Hughes report slightly firmed gas futures prices.
Front-month natural gas futures on the New York Mercantile Exchange, which were up nearly a penny at $2.882 per mmBtu just before the Baker Hughes data was released at 1 p.m. EDT, climbed slightly to about $2.91 after the report. (Reporting By Joe Silha and Selam Gebrekidan; editing by Jim Marshall)
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