Canada’s drilling fleet is always changing to incorporate new technology and meet market demand.

Most noticeably, the Canadian drilling fleet is growing in numbers. The fleet has 40%  more rigs than it did 15 years ago.

Today, the rig fleet offers a little more than 800 rigs. 

For the most part, a rig is a rig is a rig. For example, all rigs have a derrick (the mast-like structure that holds the pipe to be lowered into the well bore) a rig floor where floorhands handle drill pipe, a drawworks which is the machinery that hoists and lowers pipe and a blowout preventor that enables a driller to control well pressure.

But different size rigs are used depending on the drilling target formation.

Oil formations tend to be deeper than gas formations. When investors are most interested in producing oil, large rigs are in high demand. When the market prefers gas production, small rigs are in demand.

Western Canada has plenty of both gas and oil, and activity cycles back and forth between preferences of one over the other.

Through the 1990s, rig activity focused evenly on the two commodities.   Then in 1998, there was a shift: gas wells began to make up the bulk of drilling activity.

Through the early 2000s, rig activity increased year over year, but gas wells – which are shallower and can be drilled faster – far outstripped the increase in oil wells. Between 2001 and 2006, oil wells made up about 25% of rig activity, and gas wells 75%.

The drilling industry reacted to this demand by expanding the fleet.  In 2007, the rig fleet grew faster than it ever it had before: 49 rigs were added. Most of these new rigs were the smaller ones best suited for gas drilling.

Then in 2008, natural gas was on the market in abundance, and the stock market price of natural gas started to fall. Investors pulled back on gas drilling. In 2010, industry was back to an even split between gas wells and oil wells.

And then the turn-around happened: oil drilling overtook gas drilling in western Canada.  In 2011, 61% of the wells drilled were seeking an oil formation, versus the 39% seeking gas.

Today’s market continues to favour large rigs that can reach deep oil formations. There also is increased interest in accessing these formations at an angle: rig crews drill a well bore that curves toward a drilling target.

Drilling rig contractors have been adding equipment in 2013.  Unlike 2007's fleet expansion, these rigs will be the larger, heavier rigs, primed for oil drilling.

To read more about trends affecting Canadian drilling, review the CAODC Drilling Forecast posted at