HOUSTON, Sept. 30, 2016 /PRNewswire/ -- S&P Global Platts, the leading independent provider of information and benchmark prices for the commodities and energy markets, announced today the release of the Platts RigData U.S. Land Rig Three-Year Forecast.

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The annual Forecast, now in its 2(nd) year, is an analysis of the key drivers of domestic oil and gas supplies and what they imply for future trends over the next three years for land rig demand. As the report notes, oil prices will continue to be the primary catalyst determining U.S. rig demand in the months ahead.

"OPEC's latest agreement to modestly reduce production, a move aimed at supporting the price of crude oil globally, reinforces our expectations of strengthened U.S. rig counts next year," said Trey Cowan, senior industry analyst, Platts RigData, a forecasting unit of S&P Global Platts.

Specifically, Platts RigData projects the U.S. rig count will grow by an average of 131 rigs or 29% year over year during 2017. This would be an increase from the average estimated 449 rigs actively drilling in 2016.

Forecast Highlights Include:

    --  Oil prices to trend higher as incremental U.S. supply levels normalize
    --  Oilfield service activity to continue the recovery begun in May
    --  Elevated production derived from "high grading" (where operators focus
        on developing the highest returning wells) has entered the latter stages
        for this recovery cycle
    --  Lower incremental-production volumes per well are likely
    --  Despite recent drawdowns in drilled-but-uncompleted (DUCs) wells, oil
        and natural gas supply unlikely to expand as rapidly as first signaled

"In our opinion, the expected smaller incremental-well production volumes would imply the need for a greater number of wells to be brought into production in order to reach targeted production goals," said Cowan. "To this end, Platts RigData expects more than 11,000 U.S. oil & gas wells to be drilled during 2017. That would be an improvement of 25% year over year versus our 8,900 well spud estimate for 2016."

The Platts RigData U.S. Land Rig Three-Year Forecast looks at the full U.S. landscape, with deep dives into analysis of eight key regions active in oil and gas development. Utilizing Platts RigData's extensive database, the Forecast goes into granular detail of specifications and the technical capabilities of each rig and its working history. Unlike some approaches, the levels of production, consumption, and price trends projected in the Platts RigData Forecast are based on rig demand.

Key components of the Platts RigData U.S. Land Rig Three-Year Forecast:

    --  Regional projections of a base case plus a downside and upside growth
        case
    --  Regional summaries of developments, commodity prices, and operators'
        drilling sentiments
    --  Assessment of macroeconomics
    --  Outlook for technology advancements, effects of rig fleet age, and
        financial health of large service providers
    --  DUCs inventory overhang and outlook

The 2016 edition of the Platts RigData U.S. Land Rig Three-Year Forecast is available in print and PDF format, including an Excel workbook with all supporting data. For more information or to subscribe to the Forecast, visit http://rigdata.com/us-land-rig-three-year-forecast.

S&P Global Platts acquired RigData, a provider of daily information on rig activity for the natural gas and oil markets across North America, on June 1, 2016.

CONTACT
Americas: Kathleen Tanzy, + 1 917 331 4607, kathleen.tanzy@spglobal.com
Houston: Gregory Tsichlis, + 817 616 2081, greg.tsichlis@spglobal.com

About S&P Global Platts
At S&P Global Platts, we provide the insights; you make better informed trading and business decisions with confidence. We're the leading independent provider of information and benchmark prices for the commodities and energy markets. Customers in over 150 countries look to our expertise in news, pricing and analytics to deliver greater transparency and efficiency to markets. S&P Global Platts coverage includes oil and gas, power, petrochemicals, metals, agriculture and shipping.

S&P Global Platts is a division of S&P Global (NYSE: SPGI), which provides essential intelligence for individuals, companies and governments to make decisions with confidence. For more information, visit www.platts.com or www.platts.com/rigdata

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SOURCE S&P Global Platts

SOURCE: S&P Global Platts