Global drilling rates have been stagnating
in recent months after a rapid recovery earlier this year, but
a new push into the Arctic by Norway and the US could open up
new markets for oilfield minerals such as barytes and
International drilling rig numbers,
released by Baker Hughes on December 7, showed the total number
of rigs outside North America was at 942 in November. This is
down 9 from October, but up 17 from last year.
The offshore rig count is currently at
911, down 21 on an annual basis and 28 month on month.
In the US,
following the fracking boom earlier this year, rig numbers were
up a considerable 331 from November 2016, but down 11 from
Norwegian state-owned energy company
Statoil gave the go-ahead to a massive Arctic development on
The Johan Catsberg project, to be located
in the Barents Sea north of Tromso, is the largest offshore
project to be approved this year, Statoil said, at an estimated
450-650 million barrels.
Offshore drillers traditionally require
high-purity barytes for use as a weighting agent in drilling
Industrial Minerals assessed
barytes prices, unground lump, API, bulk, SG 4.2, fob
Morocco, at $70-88 per tonne.
The project, as currently put forward,
would require capital spending of NKr49 billion (£4.4
billion), delivering a break even price of less than $35 per
barrel. Brent crude oil is currently trading at around $63 per
Arne Sigve Nylund, Statoil’s
head of development and production in Norway, suggested that
further investment in new assets would follow.
"The field will be the backbone of further
development in the oil and gas industry in the North," she
US eyes Arctic
Norway's Statoil is not the only oil
producer that has its eyes on an expansion in the Arctic.
On December 2, the US senate passed
legislation to allow drilling in a 1.5 million acre area of the
Arctic National Wildlife Refuge in Alaska, potentially opening
up new oilfield activity in a region that has long been
off-limits to oil companies.
The legislation, which has been rolled in
with a larger tax reform bill, will face opposition in the
lower house from Democrats and from a number of dissident
republicans, who are concerned about the environmental impact
and effects on indigenous communities it will have.