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Shale Rig Owner Touts New Price Model as Drilling Speeds Up

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The biggest provider of oil and gas rigs to the U.S. shale patch is pushing a new pricing model as speedier drilling cuts into contractors’ revenue.

Rigs are typically rented out at a daily rate for a period of a few months, which has meant less money for oilfield service providers as drilling becomes quicker and more efficient. So Helmerich & Payne Inc. is touting a new pricing model based on overall well performance, and almost a third of its U.S. rigs are now being leased on that basis, Chief Executive Officer John Lindsay said Wednesday on an earnings call.