Precision Drilling bringing back 1,000 workers

  • 22 Oct 2016
  • Saskatoon StarPhoenix
  • Financial Post

Precision Drilling bringing back 1,000 workers

CALGARY Precision Drilling Corp., one of Canada’s largest drilling companies, has brought back 1,000 employees and begun increasing the price it charges customers for its specialized rigs in a sign that oilfield activity levels are beginning to recover after a prolonged downturn.

President and CEO Kevin Neveu said Friday the company was in “the early stages of this rebound” and had reactivated 53 rigs in North America and re-hired 1,000 employees. He said the majority of those oilfield workers had previously been employed by Precision.

“We’re encouraged by the significant improvement in sentiment of our customers and the resulting increase in activity and market share that we’ve achieved,” Neveu said.

Calgary-based Precision said it would hike prices for its larger, deeper-reaching rigs — called “super triples” — as demand is increasing.

Oilfield activity has slowed dramatically and tens of thousands of people have lost their jobs in Alberta since crude prices began their dramatic fall more than two years ago, with very few signs of a rebound. But Neveu said Precision had now more than doubled its activity levels since the trough, which he defined as the second quarter of this year.

“With 37 rigs operating in the U.S. today, our activity is up 70 per cent from second-quarter lows, while the industry increase is approximately 35 per cent,” the company said. “We believe our market share increase and contract additions reflect both the desirability of Precision’s high performance Super Triple rigs and our customers’ improving outlook.”

AltaCorp Capital analyst Aaron MacNeil said the Canadian drilling industry is bifurcated between large and small rigs. He added that Precision is well-positioned in the market for the larger, more automated rigs and has been able to book new contracts and better prices for those rigs next year.

“Those are starting to see pricing traction now, which means that they’re starting to come up against the available supply. Even though they’re maintaining their market share, they should relatively outperform in Canada,” MacNeil said.




About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on October 25, 2016, in economic impact, oil, political. Bookmark the permalink. 1 Comment.

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