US-based drilling rig operator Nabors sees "huge potential" to grow its rig count in Venezuela and expects its Lower 48 rig count to extend gains into the fourth quarter.
Nabors said the broader outlook for Venezuela is improving, with customers considering new long-term drilling programs.
"With the right commercial arrangements, Venezuela could quickly become a meaningful contributor to our international business," president and chief executive Anthony Petrello said on an earnings call.
Venezuela has slowly re-emerged as an oil exporter following the lifting of US sanctions after the 3 January seizure of former leader Nicolas Maduro and years of underinvestment. Crude output for the country has increased by 200,000 b/d since January to 1.2mn b/d in September but remains well below its past peak of 3mn b/d.
Nabors won a multi-year drilling contract in Venezuela in the third quarter and is redeploying an idle US rig to meet its undisclosed client's schedule.
The country currently has nine working rigs, down from more than 85 in 2013, Petrello said. Nabors retained a small employee presence in the country during the downturn and maintained its rigs there to the best extent possible.
Nabors is tracking more than 20 additional rig opportunities in Venezuela, excluding potential increases by vertically integrated operators with their own rigs, Petrello said. The company has five idle rigs in Venezuela ready to respond to increased activity.
"We are evaluating a number of opportunities with long-standing customers and other customers in Venezuela to start operations next year," Petrello said.
Nabors expects its international drilling rig count to average 92-93 rigs in the fourth quarter and exit the year with 92 rigs.
Intensified hostilities in the Middle East delayed some rig growth and equipment deliveries during the quarter. Nabors received suspension notices for five rigs in Saudi Arabia and pushed one rig deployment from the fourth quarter into the first quarter because of the disruption. Despite those delays, it remains on schedule for 18 new-build rigs to begin operations in the fourth quarter, chief financial officer Miguel Rodriguez said.
In its US business, Nabors' average Lower 48 rig count increased by six sequentially in the third quarter to 73. The company ended the quarter with 74 rigs and expects to average 75 rigs in the fourth quarter, exiting 2026 with 76-77 rigs, Rodriguez said.
Nabors expects tight US rig availability and consistent global demand to support further price gains.
