For the second quarter in a row, drilling activity in the U.S. fell to levels not seen since 2003 and 2004, according to API’s second-quarter 2009 drilling estimates. The institute’s 2009 Quarterly Well Completion Report: Second Quarter found that an estimated 8,038 oil wells, natural gas wells and dry holes were drilled in the second quarter, down 46% from the year-ago period.

“The U.S. drilling decline that began last quarter in connection with the current downturn in economic activity has continued in earnest in the second quarter of 2009 as companies proceed with caution in an uncertain year,” says Hazem Arafa, director of API’s statistics department.

The estimated number of second-quarter 2009 exploratory oil and gas wells drilled plunged 63% from 2008 levels to 336 wells, while the number of development wells slipped 46% to 6,761 wells.

While gas continues to be the primary target for domestic drilling, with an estimated 4,225 gas wells completed in this year’s second quarter, activity was down 43% from 2008’s second quarter, “the most severe quarterly decline this decade,” reports API.

Oil-well completions also continued to slide, falling in the second quarter by 53% below year-ago levels. API reported total estimated footage of 48.1 million feet drilled in the second quarter of 2009, a 53% decline from second-quarter 2008.