Newspaper article THE JOURNAL RECORD

Lower Energy Futures Slow Drilling Efforts

Newspaper article THE JOURNAL RECORD

Lower Energy Futures Slow Drilling Efforts

Article excerpt

Bob Pound sold one of his two oil and gas drilling rigs a few months ago because he couldn't keep enough workers to man it. Now the list of jobs for the one left is getting shorter.

"If work slows way down and we can't keep enough work for the men, we'll either sell it or park it across the road and leave it," said Pound, who owns a drilling company in Bristow.

U.S. energy exploration and production companies attracted as many 30,000 workers in the past year, according to industry estimates. But some contractors in the Southwest oilpatch are laying off workers, parking rigs or cutting overtime as falling oil and natural gas prices influence producers to reduce budgets for new wells.

Gas prices dropped from record highs in winter to a 2.5 year low. Oil prices fell after the Sept. 11 terrorist attacks, and OPEC says it plans no immediate production cuts to raise them.

A year ago, contractors struggled to find enough workers willing to return to the industry after getting burned by layoffs in the late 1990s. Workers slowly came back, and the rig count for gas drilling alone jumped 30 percent in a year.

Now, some contractors are cutting jobs again because of the slowdown.

Patterson UTI Energy in Snyder, Texas, laid off between 500 and 1,000 in recent months as demand fell for its 302 drilling rigs in the United States and Canada.

About 65 percent of its rigs, drilling mostly in Texas, Oklahoma and New Mexico, are running compared to a high of 80 percent, chief executive Cloyce Talbot said.

"The slowdown in commodity prices just makes some people take a second look," he said.

Crews on Roger Mills' 15 maintenance rigs in Seminole are working closer to 40 hours a week instead of 60 or more.

"Right now, we're just waiting to see what happens on production," Mills said.

Oklahoma added 2,000 drilling and production workers in the past year, up 7.4 percent. Overall in Oklahoma there was 1 percent overall job growth. Texas oil and gas extraction companies hired 9,700, a 7 percent jump. …

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