North America will lead a recovery in onshore drilling over the next few years, according to the latest market data on oil field services.
In particular, research consultancy Westwood Global Energy Group (WGEG) expects strong growth for drilling and well services expenditure to 2023, with a cumulative total of $1.6trillion to be spent – 76 per cent of it onshore.
However the latest data suggest certain markets such as oilfield equipment supply will continue to see challenging conditions.
The latest data comes from Sectors, WGEG’s online analytics tool, which enables oil field services companies and operators as well as financial advisory firms, to review market potential and future hotspots of multiple service and equipment lines, plus drilling and production activity.
WGEG claim, in terms of growth rates, the offshore Maintenance, Modifications and Operations (MMO) looks to be the most promising sector, with a substantial and sustained recovery in expenditure likely to be seen through to 2023.
Oilfield equipment, on the other hand, is expected to see stagnation in terms of dollar demand through to early next decade before signs of a recovery emerge.
This is due primarily to the marked oversupply of equipment. Most critically, the newbuild offshore rig market -comprising jackups, semisubs, and drillships – is expected to continue to decline from a peak of $24billion in 2013 to just $4.2billion by 2023.
Sectors introduces data on 103 specific service and equipment markets – covering Capex and Opex – totaling over $8tn of spend across 2005-2023.
Alongside the existing production and drilling data, it now covers 2,792 fields accounting for 197bn barrels of future production, $2.9tn of forecast expenditure and $5.5tn of historic expenditure.
Gareth Hector, head of sales and marketing, global oil field services at Westwood Global Energy Group, said: “The size and intricacy of companies operating within the oil and gas sector is changing.
“Thanks to recent and likely future M&A activity, oil field services companies are now operating across a myriad of different sectors. Meanwhile, the second and third tier players are focusing more and more on niche markets.
“Sectors is the only online tool that gives them accurate intelligence on drilling, production and cost across all of these markets, enabling them to forecast accurately and make strategic decisions based on the very latest insight.”