Clearwater Formation Drives Canada to 204 Rigs in Baker Hughes July Count as Alberta Issues Record Drilling Permits

Baker Hughes counted 204 active rigs in Canada as of July 24, 2026, according to its weekly North America rotary rig count released on Friday. That total is up 6 week-over-week from 198 and up 22 from 182 a year earlier. The United States reported 587 rigs, down 1 from the prior week, bringing the combined North America total to 791. All net week-over-week movement in the continental count came from Canada, as covered in Oil Authority's companion report on the US count and Friday oil settlement.

Clearwater Formation Sends Alberta Permits to 12-Year High

Alberta issued 1,764 drilling licenses between January 1 and June 12, 2026, the highest count for that period since 2014, according to Bloomberg reporting. Nearly one in five permits targeted the Clearwater formation, a record share for any single play in that span. Clearwater crude resembles oil sands bitumen in density and sulfur content but requires conventional horizontal drilling rather than costly steam-assisted gravity drainage. Wells reach commercial production within months, not years, enabling producers to respond quickly to commodity price moves.

Tamarack Valley Energy (TSX: TVE) leads the Clearwater play by active 2026 drilling license count. The company sold its Charlie Lake assets in May 2026 for C$804 million and used proceeds to expand Clearwater capital, raising its annual budget from C$390-410 million to C$430-450 million. Of 89 drilling licenses Tamarack received in 2026, 80 target Clearwater horizons. Waterflood injection rates across Tamarack's Clearwater acreage are on track to rise 70 percent by December 2026, with more than 35 percent of Clearwater output under active waterflood by year-end.

Headwater Exploration (TSX: HWX) is the second major Clearwater producer and raised its 2026 capital program from C$185 million to C$250 million. The company lifted its annual production-growth forecast from 8 percent to 10 percent following the budget increase. Clearwater formation output across all operators reached approximately 230,000 barrels per day in 2025, up from just 30,000 barrels per day in 2017, according to Bloomberg. An estimated 1.6 billion barrels of crude oil remain recoverable from the formation, according to Bloomberg data on Alberta Energy Regulator licensing activity.

Basel Belly River Formation Draws New Capital in Willesden Green

Southwest of Edmonton in the Willesden Green area of Alberta, Obsidian Energy (TSX: OBE) and Yangarra Resources Corp. (TSX-V: YGR) are targeting the Basel Belly River shale formation. Alberta regulators issued 15 drilling licenses in the area in the first half of 2026, the highest for that period in 14 years. Obsidian purchased 35 sections of land from Highwood Asset Management for C$105 million, adding approximately 2,500 barrels of oil equivalent per day. A six-well development program is underway to raise acquired production to 3,000 barrels per day, with combined area production estimated at 10,000-13,000 barrels per day by World Oil reporting.

Obsidian Energy was formerly known as Penn West Petroleum Ltd., rebranding in 2017 after a financial restructuring. The formation supported over 1,000 wells in 2005, primarily targeting natural gas. Drilling dropped to single digits per year by 2014 as gas prices weakened but has resumed under oil commodity economics. Each Basel Belly River well costs approximately C$5 million to drill and complete, according to World Oil.

International Petroleum Corp Starts First New Oil Sands Project Since 2014

International Petroleum Corp. (TSX: IPCO), part of the Swedish Lundin Group of Companies, achieved first oil at its Blackrod Phase 1 project on May 31, 2026, ahead of its originally planned Q3 2026 start date. Blackrod is Alberta's first new oil sands project since 2014, completed at a final cost of US$855 million against an original estimate of US$850 million. Phase 1 targets a plateau of 30,000 barrels of oil per day by late 2027, one quarter ahead of the schedule set at project sanction in 2023. Regulatory approval allows future phases to reach up to 80,000 barrels per day. Blackrod applies steam-assisted gravity drainage, contrasting with the fast-cycle horizontal drilling used by Clearwater producers Tamarack and Headwater.

Canada's Growing Share of the North America Count

Canada's 204 rigs represent 25.8 percent of the 791-rig North America total for the week of July 24. Using Baker Hughes year-over-year comparisons, Canada operated 182 rigs a year earlier, which was 25.1 percent of an estimated 724-rig continental total. Canada added rigs at a 12.1 percent annual rate versus 8.3 percent for the United States. Clearwater's sub-C$5-million well cost and months-to-first-oil cycle have contributed to Canada's faster pace of capital deployment this cycle.