UPDATE 1-US natgas rig count rises, 2nd gain in 3 weeks-Baker Hughes

Fri Oct 18, 2013 1:28pm EDT

Related Topics

* Gas rig count climbs 3 after last week's drop
    * Horizontal rigs fall for first time in 3 weeks
    * Oil rig count off 6 to 1,361, 2nd straight decline

    NEW YORK, Oct 18 (Reuters) - The number of rigs drilling for
natural gas in the United States rose this week for the second
time in three weeks, climbing by three to 372, data from
Houston-based Baker Hughes showed on Friday.
    The gas-directed rig count, which posted a six-month high of
401 five weeks ago, has increased in 10 of the last 17 weeks and
is above the 18-year low of 349 set in late June.
    A rising gas rig count can stir talk that new pipelines and
processing plants, particularly in the East, may be encouraging
producers to hook up more wells and pump more supply into an
already well-supplied market.
    Gas futures prices on Friday, which were slightly higher at
$3.76 per million British thermal units just before rig data was
released at 1 p.m. EDT (1700 GMT), edged up about a penny after
the report.
    
    
    
    The oil-focused rig count fell for the third time in four 
weeks, dropping 6 to 1,361. The oil rig count hit a nine-month
high of 1,413 in mid-June, Baker Hughes data showed. The oil
count is down 49 rigs, or 3.5 percent, from the same week last
year.
    Baker Hughes reported horizontal rigs, the type often used
to extract oil or gas from shale, posted their first decline in
the last three weeks, shedding 7 to 1,099.
    The horizontal count is down 7.9 percent from the record
high of 1,193 set in May 2012.
    While the gas rig count is off 60 percent since peaking in
October 2011 at 936, gas production has not slowed much, if at
all, from the record high hit last year. The associated gas
produced from more profitable shale oil and shale gas liquids
wells has kept dry gas flowing at or near a record pace.
    The U.S. Energy Information Administration last week raised
its estimate for domestic gas production in 2013, expecting
average output this year to post a record high for the third
straight year.
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