Optimism in oil and gas industry drives Canadian drilling forecast higher in 2017

Feb. 21, 2012 file photo of oil field workers  using a drill.
Feb. 21, 2012 file photo of oil field workers using a drill. (AP Photo/Orlin Wagner, File)

The Petroleum Services Association of Canada says it’s raising its forecast for drilling activity for 2017 in view of rising optimism in the oil and gas industry.

The Calgary-based group now says it expects 5,150 wells to be drilled this year, up 23 per cent or 975 wells over its forecast in early November.

READ MORE: Driller training rebounds in Alberta as oil prices stabilize

President Mark Salkeld says the industry is slowly recovering after more than two years of sliding activity due to oil and gas producers slashing drilling budgets to deal with reduced profits from lower oil and gas prices.

Salkeld says he’s optimistic that pricing for oilfield services that were scaled back to unsustainable levels during the downturn will start to rise again as activity picks up in reaction to higher and more stable commodity prices.

Story continues below advertisement

PSAC’s new forecast is based on 2016 average natural gas prices of C$3 per thousand cubic feet, benchmark crude oil prices of US$52.50 per barrel and a Canadian dollar value of 73 cents US.