Texas Oilfield Service Firms Expanding Slowly

Need an oil rig? Get in line and bring cash. High oil and gas prices have boosted drilling activity, and the supply of rigs can’t keep up with demand. So rig rental rates are up, and profit among oilfield service companies is booming. The number of U.S. rigs in operation grew 18 percent in 2005 to end the year at 1,470.

Company executives and analysts expect the drilling and service boom to last another year or two at least.

For the boom to fizzle, large amounts of supply must hit the market, through, for example, more liquefied natural gas imports, he said. Other analysts say new production technology or the unlikely discovery of a giant oil or gas field could also break the boom.

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