The global well intervention market is expected to grow at a CAGR of over 2% during the period of 2020-2025. The increasing drilling and completion activities, globally, has been driving the demand for the slickline services over the study period. However, the volatile oil prices over the recent period, owing to the supply-demand gap, geopolitics and several other factors has been restraining the growth in the demand for well intervention market.
- The onshore is expected to have the maximum share in the market, in 2018. Onshore drilling encompasses all the drilling sites located on dry land and accounts for 70% of worldwide oil production.
- North America is estimated to have the maximum share of the well intervention market, in 2018. Additionally, the growth rate of the South America region is expected to be the highest during the forecast period, primarily due to the rapidly increasing oil and gas activities in the region, over the forecast period.
- The increasing oil and gas discoveries coupled with the liberalization in the industry globally, has been leading to creation of new opportunities for the players to invest in. The new emerging markets are several developing nations of Middle East and Africa, Asia-Pacific and South America.
Key Market Trends
Onshore Segment to Dominate the Market
- Onshore drilling encompasses all the drilling sites located on dry land and accounts for 70% of worldwide oil production. Onshore drilling is similar to offshore drilling but without the difficulty of deep water between the platform and the oil.
- The global crude oil prices have shown signs of recovery and are improving at a good pace and the onshore projects are easier to kick start than offshore ones. Therefore, riding on the optimism associated with the recovery of crude oil prices, onshore projects are expected to record significant growth over the forecast period, in turn, driving the demand well intervention market.
- In August 2018, Baker Hughes was awarded a development contract by Cairn, Vedanta Limited, to construct approx. 300 new wells and deploy a chemical enhance oil recovery program aimed at increasing production from the Rajasthan area. The project marks the largest integrated project for BHGE in India, expanding its presence in the country and supporting the government's mission of reducing dependency on imports.
- In 2019, ONGC announced that it had allotted INR 6,000 crore in drilling 200 wells over the next seven years in Assam to increase the output from the state. The wells are expected to be drilled during the next seven years.
- Hence, with the new investment in onshore oil & gas industry, increasing exploration of unconventional resources, and the crude oil price stability, which in turn are expected to increase the demand for well intervention market around the globe.
North America to Dominate the Market
- North America is expected to dominate the well intervention market and to grow at a significant rate over the forecast period.
- The United States (US), as of 2019, is the largest producer of oil and gas. In the US, there are more than 900,000 active oil and gas wells, and more than 130,000 have been drilled since 2010.
- In 2018, the US has witnessed three significant oil discoveries, including two in the Gulf of Mexico, at Ballymore (545 Mb) at a depth of 2,000 m underwater, and at Appomattox (140 Mb) under 2,300 m of water.
- According to Canadian government report published in 2018, oil production from Canada is anticipated to reach 4.5 mmbpd by 2020, and production is expected to increase from an offshore well situated in the West Orphan Basin, offshore Newfoundland, and Labrador, which is estimated to hold 25.5 bbl of oil and 20.6 tcf of gas.
- The annual oil output of Mexico has been dropping, over the years, as the giant Cantrell field in the shallow waters of the Gulf of Mexico drying up. However, the Mexican government is trying to increase private investments in its controlled areas of the Gulf of Mexico.
- Therefore, increasing oil and gas drilling and completion activities in the region are expected to increase the demand for well intervention market over the forecast period in North America region.
The well intervention market is partially consolidated. Some of the key players in this market include Schlumberger Limited, Halliburton Company, China Oilfield Services, Weatherford Plc. and Baker Hughes Company.
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