Denver-Julesburg Basin loses 3 rigs this week, 7 since last year

The number of rigs exploring for oil and natural gas in the Denver-Julesburg Basin declined by three to 48 rigs this week from 51 rigs the week before, according to a survey by Baker Hughes Inc. (NYSE: BHI).

The number of rigs in the D.J. Basin, a drilling region that includes Northern Colorado, declined by seven this week to 48 from 55 during the same week a year earlier, according to the oil field services firm Baker Hughes.

One rig operating in the D.J. Basin can support between 120 and 125 direct and indirect jobs, said Stan Dempsey, president of the Colorado Petroleum Association.

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“It’s not a surprise rig count is down with (oil) prices where they are,” Dempsey said. “What’s happening now is companies are re-evaluating their capital budgets.”

The Woodlands, Texas,-based Anadarko Petroleum Corp. (NYSE: APC), among the top oil and natural-gas producers in Weld County, represents one of the companies cutting its capital budget.

CEO Al Walker told analysts during an earnings conference call earlier this week that the company planned a significant reduction in its capital spending. He declined to disclose details of the plan until the company holds its analyst day in March.

Colorado lost eight rigs this week, sinking to 55 rigs from 63 last week. A year ago, 62 rigs were operating.

The lower rig counts come as oil field companies remove rigs from operations nationwide due to lower oil prices caused by oversupply. The price of West Texas Intermediate crude oil rose 3 percent to $52.01 per barrel Friday, far below highs topping $100 last summer.

Nationwide, the U.S. lost 87 rigs, decreasing to 1,456 this week from 1,543 last week.

In Weld County, the number of drilling permits approved by the Colorado Oil and Gas Conservation Commission remained essentially flat at 1,235 from July through December, from 1,219 drilling permits during the same period a year earlier.