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World Land Drilling Rig Market Forecast 2015-2019

More Modest Outlook for Global Land Rig Market in 2015-2019 Due to Current Low Oil Price Environment

Given the current economic conditions, there is a more modest outlook for the land drilling rig market through to 2019. The recent decline in oil price is expected to result in a 19% drop in onshore wells drilled in 2015, with several operators having announced planned reductions in expenditure. This expected fall in drilling activity is likely to have a significant impact on rig demand, with the global operational and active rig populations forecast to decline by 11% and 12% respectively in 2015.

Based on a scenario in which the oil price returns to pre-crisis levels of $70-80 per barrel in 2016, the number of operational rigs is expected to rise by 19% over 2015-2019 as drilling activity recovers. Asia-Pacific is expected to see the largest regional increase in capable fleet size, with 230 units forecast to be added in 2015-2019.

Increased well depths and drilling complexity have resulted in rising demand for high horsepower (HP) rigs, with the global number of active rigs rated over 1,250 HP having risen by 33% in 2010-2014. This trend is set to continue over the forecast period at a CAGR of 5%. More complex well drilling requirements are also expected to drive an increase in expenditure on components such as top drives over the 2015-2019 period. An increase in the number of rigs being converted to AC power, as well as the use of technologies such as pad drilling, is expected as operators seek to maximise the efficiency of drilling operations.

The possibility of a further decline in oil price remains a potential downside risk to the forecast. Although the risk to conventional onshore drilling is lower, high Capex unconventional projects, including the use of Enhanced Oil Recovery (EOR) techniques could become uneconomic if the current economic conditions continue. In this event, demand for high HP rigs is likely to be impacted.

The report has been developed and expanded, following client feedback and extensive industry analysis, to include:

  • Drivers, trends & themes - a discussion of the fundamentals that drive the exploration process, including those which impact the land drilling market.
  • Manufacturing - detailed overview of the key elements of a land rig, the supply chain and sales process. Global analysis of the key rig equipment manufacturers operating in each regional rig component market. Rig equipment trends for top drive systems & rotary steerable systems, automation & AC power and pad drilling & walking rigs. Land rig construction forecast.
  • Regional drilling market - comprehensive summary at the regional level including: onshore wells drilled, rig fleet growth, active drilling rigs required and key trends in each region. Since producing the previous edition of the report, Douglas-Westwood has gained improved visibility of core markets such as China, resulting in a 4% increase in the number of identified rigs.
  • Regional competitive landscape of identified rigs - matrix of drilling contractors operating in each region, indicating the overall size, composition and countries of operation of each contractor's fleet.
  • Market forecasts - comprehensive examination, analysis and ten-year view of the market, with historic data covering the period 2010-2014 and forecast data for 2015-2019, including: onshore wells drilled, rig fleet growth, active drilling rigs required and global trends.

Why purchase the World Land Drilling Rig Market Forecast?

The report includes the very latest market outlook based on DW Drilling & Production data and reflects the current low oil price environment.

DW's market forecasting is trusted by sector players worldwide, with clients including the world's top-10 oil & gas companies, top-10 oilfield services companies and top-10 private equity firms.

The report is essential reading for land rig contractors, rig manufacturers, oilfield service companies, oil & gas operators and financial institutions wanting to better understand where and when to make investment decisions.

Our proven approach includes:

  • Unique and proprietary data - DW maintains a unique global in-house database of rig fleets: the DW Land Rig Database, which is updated year-round from published sources and insight gained from industry consultation - this involves discussions with a wide-range of companies including equipment manufacturers, engineering consultancies and private equity firms.
  • Methodology - the rig demand model is based on drilling and production forecasts and the rigs identified in DW's Land Rig Database, with assumptions fine-tuned using knowledge which DW has gained through extensive consultations with industry.
  • Country-by-country analysis - comprehensive examination of 35 key countries, including: oil & gas production, onshore wells drilled, active drilling rigs required, forecast rig utilisation, investment and key trends in each country, fleet capacity and features, plus the competitive landscape.
  • Concise report layout - consistent with DW's commitment to delivering value for our clients, all our market forecasts have a concise layout consisting of industry background and supporting materials condensed to enable quick review with ‘speed-read' summaries of key points throughout.

Table of Contents

1. Summary & Conclusions

  • Summary
  • Conclusions

2. Drivers & Indicators

  • Market Drivers
  • Energy Demand
  • Exploration & Production
  • Oil & Gas Prices
  • Oil & Gas Price Sensitivities
  • Drilling, Complexity & Unconventional E&D
  • North American Land Fleet Evolution
  • Political Considerations: MENA
  • Political Considerations: Local Content & Corruption

3. Manufacturing

  • Overview: Key Elements of a Land Rig
  • Supply Chain & Sales Process
  • Key Components: Manufacturers
  • Rig Equipment: OEM Manufacturer Ranking
  • Global Top Drive Markets
  • Rig Equipment Trends: Top Drive Systems & Rotary Steerable Systems
  • Rig Equipment Trends: Automation & AC Power
  • Rig Equipment Trends: Pad Drilling & Walking Rigs
  • Land Rig Additions Forecast

4. Methodology

  • Rig Data, Analysis & Assumptions
  • Drilling & Production Forecast: Methodology
  • Differing Rig Counts
  • Country Analysis: Definitions
  • Country Analysis: Key Metrics

5. Global Analysis

  • Global Outlook
  • Regional Rig Fleets
  • Global Rig Fleet: Identified Drilling Rigs

6. Asia Analysis

  • Asia: Rig Supply and Demand
  • Asia: Identified Rigs (Competitive Landscape)
  • Australia
  • China
  • India
  • Indonesia
  • Pakistan
  • Thailand

7. Eastern Europe & FSU Analysis

  • Eastern Europe & FSU: Rig Supply and Demand
  • Eastern Europe & FSU: Identified Rigs (Competitive Landscape)
  • Azerbaijan
  • Kazakhstan
  • Poland
  • Romania
  • Russia

8. Latin America Analysis

  • Latin America: Rig Supply and Demand
  • Latin America: Identified Rigs (Competitive Landscape)
  • Argentina
  • Brazil
  • Colombia
  • Ecuador
  • Mexico
  • Peru
  • Venezuela

9. MENA Analysis

  • MENA: Rig Supply and Demand
  • MENA: Identified Rigs (Competitive Landscape)
  • Algeria
  • Egypt
  • Iran
  • Iraq
  • Kuwait
  • Libya
  • Oman
  • Saudi Arabia
  • Syria
  • Turkey
  • United Arab Emirates (UAE)
  • Yemen

10. North America Analysis

  • North America: Rig Supply and Demand
  • North America: Identified Rigs (Competitive Landscape)
  • Canada
  • USA

11. Sub-Saharan Africa Analysis

  • Sub-Saharan Africa: Rig Supply and Demand
  • Sub-Saharan Africa: Identified Rigs (Competitive Landscape)
  • Gabon
  • Nigeria
  • Sudan and South Sudan

12. Western Europe Analysis

  • Western Europe: Rig Supply and Demand
  • Western Europe: Identified Rigs (Competitive Landscape)

13. Appendix

  • Data and Text Conventions

Figures

  • Figure 1: Global - Rig Fleet and Drilling Utilisation
  • Figure 2: Active Drilling Rig Count by Region 2010-2019
  • Figure 3: Primary Energy Consumption by Region
  • Figure 4: Onshore Production Shortfall 2000-2013
  • Figure 5: IHS CERA Upstream Cost Index 2000-2014 (Q3)
  • Figure 6: Annual Brent Spot Oil Price Forecast
  • Figure 7: Annual Natural Gas Price
  • Figure 8: Relative Sensitivities of Various Markets to Changes in Oil & Gas Prices
  • Figure 9: A well being drilled horizontally, engaging in fracking
  • Figure 10: USA Available vs. Active Land Rigs, 1988-2014
  • Figure 11: Drilling Markets Affected by the Arab Spring
  • Figure 12: Local Content and Corruption in MENA Countries
  • Figure 13: Key Elements of a Land Rig
  • Figure 14: Land Drilling Supply Chain
  • Figure 15: Rig Equipment Manufacturer Ranking
  • Figure 16: Pad Drilling
  • Figure 17: Typical Drilling Pad
  • Figure 18: Land Rig Construction Forecast by Region, 2008-2017
  • Figure 19: Comparison of Historic Rig Counts, Saudi Arabia
  • Figure 20: Usable Fleet vs. Operating vs. Drilling, Saudi Arabia
  • Figure 21: UAE - Rig Fleet and Implied Utilisation
  • Figure 22: UAE - Estimated Split of Market Share by Contractor & Type
  • Figure 23: Global - Rig Fleet and Drilling Utilisation
  • Figure 24: Global - Wells Drilled vs. Rigs Operational
  • Figure 25: Number and Specification of Identified Drilling Rigs in Each Country
  • Figure 26: Asia - Rig Fleet and Drilling Utilisation
  • Figure 27: Asia - Wells Drilled vs. Rigs Operational
  • Figure 28: Australasia - Rig Fleet and Drilling Utilisation
  • Figure 29: Australia - Estimated Split of Market Share by Contractor & Type
  • Figure 30: China - Rig Fleet and Drilling Utilisation
  • Figure 31: China - Estimated Split of Market Share by Contractor & Type
  • Figure 32: India - Rig Fleet and Drilling Utilisation
  • Figure 33: India - Estimated Split of Market Share by Contractor & Type
  • Figure 34: India - Rig Fleet and Drilling Utilisation
  • Figure 35: India - Estimated Split of Market Share by Contractor & Type
  • Figure 36: Pakistan - Rig Fleet and Drilling Utilisation
  • Figure 37: Pakistan - Estimated Split of Market Share by Contractor & Type
  • Figure 38: Pakistan - Rig Fleet and Drilling Utilisation
  • Figure 39: Pakistan - Estimated Split of Market Share by Contractor & Type
  • Figure 41: Eastern Europe & FSU - Rig Fleet and Drilling Utilisation
  • Figure 40: Eastern Europe & FSU - Wells Drilled vs. Rigs Operational
  • Figure 42: Azerbaijan - Rig Fleet and Drilling Utilisation
  • Figure 43: Azerbaijan - Estimated Split of Market Share by Contractor & Type
  • Figure 44: Kazakhstan - Rig Fleet and Drilling Utilisation
  • Figure 45: Kazakhstan - Estimated Split of Market Share by Contractor & Type
  • Figure 46: Poland - Rig Fleet and Drilling Utilisation
  • Figure 47: Poland - Estimated Split of Market Share by Contractor & Type
  • Figure 48: Romania - Rig Fleet and Drilling Utilisation
  • Figure 49: Romania - Estimated Split of Market Share by Contractor & Type
  • Figure 50: Russia - Rig Fleet and Drilling Utilisation
  • Figure 51: Russia - Estimated Split of Market Share by Contractor & Type
  • Figure 53: Latin America - Rig Fleet and Drilling Utilisation
  • Figure 52: Latin America - Wells Drilled vs. Rigs Operational
  • Figure 54: Argentina - Rig Fleet and Drilling Utilisation
  • Figure 55: Argentina - Estimated Split of Market Share by Contractor & Type
  • Figure 56: Brazil - Rig Fleet and Drilling Utilisation
  • Figure 57: Brazil - Estimated Split of Market Share by Contractor & Type
  • Figure 58: Colombia - Rig Fleet and Drilling Utilisation
  • Figure 59: Colombia - Estimated Split of Market Share by Contractor & Type
  • Figure 60: Ecuador - Rig Fleet and Drilling Utilisation
  • Figure 61: Ecuador - Estimated Split of Market Share by Contractor & Type
  • Figure 62: Mexico - Rig Fleet and Drilling Utilisation
  • Figure 63: Mexico - Estimated Split of Market Share by Contractor & Type
  • Figure 64: Peru - Rig Fleet and Drilling Utilisation
  • Figure 65: Peru - Estimated Split of Market Share by Contractor & Type
  • Figure 66: Venezuela - Rig Fleet and Drilling Utilisation
  • Figure 67: Venezuela - Estimated Split of Market Share by Contractor & Type
  • Figure 69: MENA - Rig Fleet and Drilling Utilisation
  • Figure 68: MENA - Wells Drilled vs. Rigs Operational
  • Figure 70: Algeria - Rig Fleet and Drilling Utilisation
  • Figure 71: Algeria - Estimated Split of Market Share by Contractor & Type
  • Figure 72: Egypt - Rig Fleet and Drilling Utilisation
  • Figure 73: Egypt - Estimated Split of Market Share by Contractor & Type
  • Figure 74: Iran - Rig Fleet and Drilling Utilisation
  • Figure 75: Iran - Estimated Split of Market Share by Contractor & Type
  • Figure 76: Iraq - Rig Fleet and Drilling Utilisation
  • Figure 77: Iraq - Estimated Split of Market Share by Contractor & Type
  • Figure 78: Kuwait - Rig Fleet and Drilling Utilisation
  • Figure 79: Kuwait - Estimated Split of Market Share by Contractor & Type
  • Figure 80: Libya - Rig Fleet and Drilling Utilisation
  • Figure 81: Libya - Estimated Split of Market Share by Contractor & Type
  • Figure 82: Oman - Rig Fleet and Drilling Utilisation
  • Figure 83: Oman - Estimated Split of Market Share by Contractor & Type
  • Figure 84: Saudi Arabia - Rig Fleet and Drilling Utilisation
  • Figure 85: Saudi Arabia - Estimated Split of Market Share by Contractor & Type
  • Figure 86: Syria - Rig Fleet and Drilling Utilisation
  • Figure 87: Syria - Estimated Split of Market Share by Contractor & Type
  • Figure 88: Turkey - Rig Fleet and Drilling Utilisation
  • Figure 89: Turkey - Estimated Split of Market Share by Contractor & Type
  • Figure 90: Australasia - Rig Fleet and Drilling Utilisation
  • Figure 91: Australia - Estimated Split of Market Share by Contractor & Type
  • Figure 92: Yemen - Rig Fleet and Drilling Utilisation
  • Figure 93: Yemen - Estimated Split of Market Share by Contractor & Type
  • Figure 95: North America - Rig Fleet and Drilling Utilisation
  • Figure 94: North America - Wells Drilled vs. Rigs Operational
  • Figure 96: Canada - Rig Fleet and Drilling Utilisation
  • Figure 97: Canada - Estimated Split of Market Share by Contractor & Type
  • Figure 98: USA - Rig Fleet and Drilling Utilisation
  • Figure 99: USA - Estimated Split of Market Share by Contractor & Type
  • Figure 101: Sub-Saharan Africa - Rig Fleet and Drilling Utilisation
  • Figure 100: Sub-Saharan Africa - Wells Drilled vs. Rigs Operational
  • Figure 102: Gabon - Rig Fleet and Drilling Utilisation
  • Figure 103: Gabon - Estimated Split of Market Share by Contractor & Type
  • Figure 104: Nigeria - Rig Fleet and Drilling Utilisation
  • Figure 105: Nigeria - Estimated Split of Market Share by Contractor & Type
  • Figure 106: Sudan and South Sudan - Rig Fleet and Drilling Utilisation
  • Figure 107: Sudan and S. Sudan - Estimated Split of Market Share by Contractor & Type
  • Figure 109: Western Europe - Rig Fleet and Drilling Utilisation
  • Figure 108: Western Europe - Wells Drilled vs. Rigs Operational

Tables

  • Table 1: Global Identified Rig Fleet and Implied Utilisation
  • Table 2: Regional Rig Fleets
  • Table 3: Asia Identified Rigs
  • Table 4: Australia - Fleet HP
  • Table 5: China - Fleet HP
  • Table 6: India - Fleet HP
  • Table 7: India - Fleet HP
  • Table 8: Pakistan - Fleet HP
  • Table 9: Pakistan - Fleet HP
  • Table 10: Eastern Europe & FSU Identified Rigs
  • Table 11: Azerbaijan - Fleet HP
  • Table 12: Kazakhstan - Fleet HP
  • Table 13: Poland - Fleet HP
  • Table 14: Romania - Fleet HP
  • Table 15: Russia - Fleet HP
  • Table 16: Latin America Identified Rigs
  • Table 17: Argentina - Fleet HP
  • Table 18: Brazil - Fleet HP
  • Table 19: Colombia - Fleet HP
  • Table 20: Ecuador - Fleet HP
  • Table 21: Mexico - Fleet HP
  • Table 22: Peru - Fleet HP
  • Table 23: Venezuela - Fleet HP
  • Table 24: MENA Identified Rigs
  • Table 25: Algeria - Fleet HP
  • Table 26: Egypt - Fleet HP
  • Table 27: Iran - Fleet HP
  • Table 28: Iraq - Fleet HP
  • Table 29: Kuwait - Fleet HP
  • Table 30: Libya - Fleet HP
  • Table 31: Oman - Fleet HP
  • Table 32: Saudi Arabia - Fleet HP
  • Table 33: Syria - Fleet HP
  • Table 34: Turkey - Fleet HP
  • Table 35: Australia - Fleet HP
  • Table 36: Yemen - Fleet HP
  • Table 37: North America Identified Rigs
  • Table 38: Canada - Fleet HP
  • Table 39: USA - Fleet HP
  • Table 40: Sub-Saharan Africa Identified Rigs
  • Table 41: Gabon - Fleet HP
  • Table 42: Nigeria - Fleet HP
  • Table 43: Sudan and South Sudan - Fleet HP
  • Table 44: Western Europe Identified Rigs
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