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Oilfield service market size worth $145.96 Bn by 2028

Oilfield service market

Oilfield service market size worth $145.96 Bn by 2028. By Ana Paula Ferrer.

The oilfield service market is projected to reach $145.96 billion by 2028. The market size was valued at $96.46 billion in 2021. From 2021 to 2028 it is expected to grow at a CAGR of 6.1%.

The latest research by The Insight Partners revealed the previously mentioned data. According to the report, the global oilfield service market growth is driven by oil and gas production and exploration activities. This increases the demand for offshore/deep-water discoveries.

Moreover, among the key players in the global oilfield market mentioned are Halliburton Company; Schlumberger Limited; Baker Hughes Incorporated; GE Oil & Gas; Superior Energy Services, Inc; Hunting plc; Weatherford International PLC; Nov Inc; PETRODYN; Pioneer Energy Services Corp; and Archer Limited.

Oilfield service market

The oilfield service market includes the production, operation, exploration, drilling, and intervention among others throughout the life cycle of a well. Oilfield services also assist operators with the control of subsurface pressures, reduction of borehole erosion, minimization of formation damage; and many other things in order to maintain the hole for future extraction.

Based on service type, segments into well completion, wire line, artificial lift, perforation, drilling and completion of fluids, etc. On the other hand, based on application, the oilfield service market divides into onshore and offshore.  There is a rising demand for natural gas and crude oil; due to the increased onshore activity in nations like China and Saudi Arabia. This has boosted the industry’s expansion

Another thing that has helped this boost is the development of existing offshore wells and rising investments in deep and ultra-deep water drilling activities and subsea oil and gas assets; as well as the worldwide increase in the number of offshore rigs and increased investments by top oil and gas firms make predictions for it to rise significantly.

Geographic Segmentation

Moreover, based on geography, it is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and South America. Each of these regions are sub segmented.

North America dominates the global market due to extensive oil and gas exploration and production projects. Additionally, there are new activities surging in the US, the Gulf of Mexico, and Canada. In this region, the expansion of oil and gas output and the development of shale gas predict to boost the growth of the oilfield services industry in the coming years.

Asia Pacific projects to grow due to the increasing adoption of technologically advanced equipment for drilling operations as well as continuous growth of oil production. Moreover, several offshore drilling projects in Australia, Malaysia and Indonesia have augmented the number of activities in the region.

Also, the Middle East and Africa, as well as the South America regions expect to steadily grow. Rising investments in the oil and gas sector are propelling the demand for advanced equipment, including the oilfield services.

Technology

Like any other industry and market, technological advances have impacted the oilfield services changing them forever. In addition, the high demand for oil and gas has led prominent corporations to turn to technology-based services.

These advances improve and increase efficiency in resource extraction and management.  They also increment the accuracy, and precision, and decrease time and labor costs.

Shale gas

Shale gases are the ones found trapped inside shale (a fine-grained sedimentary rock) formations.  According to the Energy Information Administration (EIA), the unproven theoretically recoverable shale gas potential in the US estimates are 482 trillion cubic feet.

This type of gas can be a greener solution since it emits less carbon than coal. The production of shale gas has resulted in a new abundance of natural gas supply. Moreover, Canada offers long-term possibilities for natural gas supply across North America due to the abundance of shale gas resources found in its territory.

Currently, the country with more shale reserves is China; with a sizable portion of its output coming from the Sichuan Basin. According to China National Energy Administration the country intends to increase output to 30 billion cubic meters per year by 2020; and 80-10 billion cubic meters per year by 2030. The continuous growth of shale basins around the world, bolsters the growth of the oilfield service market.

As mentioned before there are some key companies that play an important part in the growth of the oilfield service market:

Baker Hughes and NET Powers

According to the report, one of the key players in the growth of the oilfield service market is the partnership between Baker Hughes and Net Power. In February 2022 they announced the partnership. Their objective is to advance development and global deployment of zero-emissions power plants.

Baker Hughes enters as an established industrial energy partner; investing in NET Power to advance the technical and commercial deployment of NET Power’s low-cost, electric power system. This system generates no atmospheric emissions and inherently captures all carbon dioxide.

“NET Power’s emissions-free power technology solution is driven by advances in clean power efficiency and carbon capture which are key enablers and demonstrate the vital role climate technology plays in enabling the energy transition,” said Rod Christie, executive vice president of Turbomachinery & Process Solutions at Baker Hughes.

Novo Inc. and the acquisition of ADS

Another key player mentioned by the study is Novo Inc. who in February 2022, announced the completion of the acquisition of Advanced Drilling Solutions (ADS). With this new acquisition, Novo Inc. will be able to offer integrated managed pressure drilling solutions. Moreover, they will provide equipment, expertise and capabilities to support full rig integration and automation.

“The combination of NOV’s experience and expertise and AFGlobal’s extensive portfolio of capabilities will bring about the next industry breakthrough in MPD,” said Mark Lapeyrouse; President of WellSite Services at NOV. “We’re eager to blend our rig automation expertise with AFGlobal’s premium design, engineering and manufacturing to create the industry’s most advanced and enabling MPD system.”

Additionally, their wired pipe and Max™ integrate their full MPD system platform; creating the world’s most complete automated drilling package and allowing the operator to adjust in real-time; improving the overall well construction process.

Schlumberger launches PeriScope Edge*

Last year, the technology company Schlumberger announced the launching of PeriScope Edge*; a multilayer mapping-while-drilling service. It expands the depth detection range and improves resolution compared to existing services; while utilizing cloud and digital solutions to offer reservoir insights.

“Reducing geological uncertainty plays a critical role to improve drilling performance,” said Jesus Lamas, president, Well Construction, Schlumberger. “The PeriScope Edge service introduces new measurements and an industry leading inversion process, enabled by hardware and digital innovations, to deliver accurate geosteering in reservoirs where multiple thin layers could not previously be mapped.” Moreover, Lamas mentioned that this, combined with cloud computing and secure connectivity, creates a unique geosteering workflow that links stakeholders for instant decision making, which results in optimal reservoir exposure improving net-to-gross ratios, and ultimately greater overall drilling performance that unlocks full reservoir potential.

Archer Limited acquires Deepwell

Finally, Archer Limited acquired DeepWell. DeepWell is a leading Norwegian well intervention company focused on mechanical wireline and cased hole logging services.

“An acquisition of DeepWell would secure Archer’s access to a modern fleet of electric wireline units, as well as enable participation in the vessel-based light well intervention market. Strengthening our equipment fleet, broadening our low carbon/low emission solutions and continuing our track record for service quality are all key aspects of our strategy on the NCS.  We are impressed by DeepWell’s team and look forward to continuing this process with them,” said Dag Skindlo, Archer’s CEO.

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COVID-19

The outbreak of COVID-19 hit the oilfield services market in 2020. Due to the strict measures taken by governments worldwide, the demand for oil and gas decreased; resulting in a drop in oil prices in March 2020.

According to the report, The West Texas Intermediate (WTI) oil price was US$ 61.1 on December 31, 2019; and it was US$ 23.4 on March 23, 2020, a drop of more than 60.0%. As of April 2020, OPEC and other oil-producing nations have agreed to cut oil output by 10 million barrels per day (BPD); or around 23.0% of current levels.

Furthermore, the COVID-19 pandemic has impacted the oil and gas industry in such a way that it has taken it to a point-of-no-return state; where green energy is taking the lead. For example, the European Union intends to make the economic recovery a green one; having committed an additional €225 billion (or 1.7% of GDP) to the energy transition.

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