FINWIRES · TerminalLIVE
FINWIRES

WCSB Rig Count Rises to 224, Canadian Oilfield Services Stocks Fall 4%, RBC Says

By

The Western Canadian Sedimentary Basin rig count rose 1 week-over-week to 224, while Canadian oilfield services stocks fell 4%, RBC Capital Markets said Tuesday.

Canadian oilfield services stocks declined 4% over the week, with Precision Drilling (PDS) down 2%, Trican Well Service down 2.3% and Calfrac Well Services down 2.7%.

The weakest performers were Ensign Energy Services, down 5%, Pason Systems, down 5.2%, and Enerflex (EFXT), down 9.5%. RBC's Canadian oilfield services coverage group gained 31.3% year-to-date versus 51.4% for the S&P/TSX Capped Energy Index.

RBC said the WCSB count stood at 39 rigs above 2025 levels and 31 rigs above its five-year average, with the Q3 average at 223, compared with RBC's estimate of 201.

Private-company rig counts increased by 2 week-over-week, while large exploration and production operators producing more than 75,000 barrels of oil equivalent per day added 1 rig.

Montney activity held at 41 rigs, with ARC Resources operating 7 rigs, Ovintiv (OVV) 6 rigs and Tourmaline Oil 5 rigs.

Montney drillers included Precision Drilling (PDS) with 22 rigs, or 54% of the total, Ensign Energy with 9 rigs, or 22%, and Savanna Energy with 3 rigs, or 7%.

Duvernay activity increased 2 rigs over the week to 14, with Whitecap Resources operating 3 rigs, Paramount Resources 2 rigs and Artis Exploration 1 rig, according to RBC.

Drilling activity in Duvernay included 4 rigs from Ensign Energy and 4 rigs from Precision Drilling, each representing 29% of the total, while Akita Drilling operated 2 rigs, or 14%.

Southeast Saskatchewan gained 1 rig over the week to 18, with Tundra Oil & Gas operating 4 rigs, Saturn Oil & Gas 3 rigs and Whitecap Resources 3 rigs.

Drilling contractors in Southeast Saskatchewan included Stampede Drilling with 8 rigs, representing 44% of the total, followed by Ensign Energy with 5 rigs, or 28%, and Betts Drilling with 2 rigs, or 11%.

Heavy Oil activity fell 2 rigs over the week to 57, with Canadian Natural Resources (CNQ) operating 11 rigs, Spur Petroleum 7 rigs and Tamarack Valley Energy 5 rigs.

Precision Drilling led Heavy Oil drilling with 23 rigs, or 40% of the total, followed by Ensign Energy Services with 8 rigs and Savanna Energy Services with 7 rigs.

RBC's Canadian E&P analysts forecast that companies under coverage will generate $6.5 billion in pre-dividend free cash flow in 2026 and $7.1 billion in 2027, based on the futures strip.

Operators are expected to reinvest 66% of cash flow in 2026 and 64% in 2027, compared with a five-year trailing average reinvestment rate of 63%.

Related Articles

Commodities

Benford Investment Targets US Oil, Gas Opportunities as LNG Demand Grows

Benford Investment is expanding its US oil and natural gas investment focus as record production and rising LNG exports support demand, the company said Tuesday.The Hong Kong-based investment firm will assess opportunities across oil and gas production, energy infrastructure and businesses serving rising domestic and international energy demand.US marketed natural-gas production should average a record 122.5 billion cubic feet per day in 2026, the company said, citing data from the US Energy Information Administration.Five LNG projects are expected to start operations through 2027, with US LNG exports projected to rise from about 15 Bcf/d in 2025 to roughly 17 Bcf/d in 2026, according to EIA.Benford said expanding LNG infrastructure will allow US natural-gas producers to serve domestic customers while reaching international markets, supporting its broader investment focus.The company will also examine established producing regions such as the Permian Basin, where natural-gas output should average about 29.2 Bcf/d in 2026.Permian Basin gas production is expected to increase about 6% from 2025, while Benford will assess production economics, infrastructure, reserves, operations and balance-sheet strength.Benford said reliable energy supplies, resilient infrastructure, rising electricity demand and industrial activity will support investment interest in US oil and natural gas.The company will weigh commodity price exposure, operating costs, capital needs, financial strength, regulatory and environmental factors, and potential long-term returns, stressing that it will assess each opportunity individually.

Commodities

US Natural Gas Update: Warmer Weather Forecasts Spur Late Rally

US natural-gas prices rose into positive territory in after-hours trade on Tuesday amid warmer forecasts, having softened through most of the day, tracking a plunge in crude-oil prices.The front-month Henry Hub price edged up by 0.40% to $2.793 per million British thermal units, while the continuous contract gained 0.35% to $2.845/MMBtu.The Energy Buyers' Guide said that with just two trading days left before the expiry of the September contract, which could introduce some additional volatility to the front of the curve, "the broader fundamental backdrop remains relatively soft, and winter pricing continues to carry most of the recent downside momentum as the market approaches the fall shoulder season."In the near term, the Commodity Weather Group said Tuesday that forecasts had shifted to hotter, with above-average temperatures expected across the Gulf, Midwest and Mid-Atlantic from Aug. 30 through Sept. 8. Beyond the first week of September, temperatures are expected to be milder as the market transitions into the shoulder season.The warm weather in the southern US is supporting national demand. US demand from the lower-48 states was 77.9 billion cubic feet per day, up 2.8% year over year, according to BNEF. Celsius Energy said powerburn rose to 45.4 Bcf on Monday, up 2 Bcf from Sunday and up 2.5 Bcf from the same day a year ago. It said natural gas made up 45% of the power fuel mix.On the supply side, U.S. Lower-48 dry-gas production was estimated at 110.9 Bcf/d, up 1.4% from a year earlier, according to BNEF.Output remains robust despite some recent variability. Bloomberg pegged Lower-48 dry gas production at 110.9 Bcf/d on Tuesday, up 1.4% from the same period last year. Gelber & Associates said production was running at its weakest level in two weeks, while Canadian imports stood at 4.6 Bcf/d, putting total supply at 115.6 Bcf/d.Government inventory data Thursday is expected show a 22-27 Bcf build for the week ended Aug. 21, Reuters said Tuesday. That would be smaller than the five-year average of 33 Bcf.Estimated net gas flows to US liquefied natural gas export terminals were 17.4 Bcf/d on Tuesday, down 2.9% from the previous week, according to BNEF. Flows remained below capacity as Golden Pass continued its slow production ramp-up and maintenance at Cheniere Energy's Corpus Christi plant, while Freeport LNG reduced feedgas demand.

Commodities

US Power Update: Electricity Markets Mostly Higher, Gas Dominates Generation Mix

US electricity markets were mostly higher Tuesday afternoon, with ISO New England's intraday prices peaking at $263.02 per megawatt-hour, according to data from GridStatus.io.Electric Reliability Council of Texas' real-time locational marginal price stood at $26.78/MWh at 4 p.m. ET. Net load was 49.48 gigawatts, with natural gas leading the generation mix at 40.3%.California Independent System Operator's real-time LMP came in at $56.94/MWh at 4 p.m. ET. Net load totaled 10.43 GW, with solar leading at 55.7%. The intraday high reached $86.15/MWh at 4:55 p.m. ET.Southwest Power Pool's real-time LMP was $18.23/MWh at 4 p.m. ET. Net load stood at 39.81 GW, while natural gas accounted for 37.3% of the generation mix.PJM's real-time LMP was $29.03/MWh at 4 p.m. ET. Net load stood at 87.14 GW at 12 p.m. ET, with gas leading the mix at 41.1%.Midcontinent ISO's real-time LMP came to $32.29/MWh at 4 p.m. ET. Net load was 78.23 GW, with coal accounting for 31.2% of the generation mix.New York ISO's real-time LMP reached $45.87/MWh at 4 p.m. ET. Net load totaled 18.73 GW, with dual fuel making up 33.2% of the mix.ISO NE's real-time LMP stood at $49.55/MWh at 4 p.m. ET. Net load came to 13.52 GW, with natural gas supplying 48.6% of generation. Prices reached an intraday high of $263.02/MWh at 1:50 a.m. ET.Independent Electricity System Operator's real-time LMP was $42.50/MWh at 4 p.m. ET. Net load was 18.25 GW at 3:55 p.m. ET, with nuclear accounting for 40.6% of the mix.The National Weather Service's Climate Prediction Center forecasts temperatures to stay above normal across much of the central and eastern US from Sept. 2-8, with near-normal readings across the West.