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Gulf Drilling: Still Lagging

Mark Green

Mark Green
Posted October 3, 2011

There have been recent reports that drilling in the Gulf of Mexico is coming back strong, with exploration and development returning to 2009 levels. We wish. New analysis (PDF here) by Quest Offshore Resources suggests otherwise:

  • As of the end of September, there were 21 floating rigs in the Gulf, of which only 18 were drilling wells. Before the 2010 drilling moratorium, there were 33 floating rigs with 29 engaged in drilling, about a 37 percent decrease.
  • The decrease in activity translates to approximately 60 wells lost, based on the original contract terms for the rigs. Loss of the rigs amounts to lost spending of $6.3 billion and annual lost direct employment of 11,500 over two years.
  • Since the moratorium 11 drilling rigs have left the Gulf with just one returning. 3 rigs are sitting idle.
  • While a return to pre-moratorium rig counts is expected by mid-2012, drilling activity is not expected to return to pre-moratorium levels before 2014 because of low government permitting rates and operators not returning rigs to the Gulf.

(Updated 10/5)


Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.