Market Trends of Oil and Gas Downhole Vibration Monitoring and Control System Industry
This section covers the major market trends shaping the Oil & Gas Downhole Vibration Monitoring & Control System Market according to our research experts:
Onshore Sector to Dominate the Market
- Timely detection and mitigation of downhole vibration is key to avoiding non-productive time (NPT) and preventing equipment damage. For this, along with MWD, downhole vibration monitoring (DVM) tools are deployed, preventing damage to BHA.
- In 2019, India's state-owned company 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 increasing the demand for DVM tools during the forecast period.
- In Russia, Gazprom Neft continues to conduct studies on its Bazhenov acreage and is targeting 40,000 b/d of production from shale by 2023. To attain successful recovery, the demand for MWD, including DVM, is likely to increase.
- Due to the downfall of the oil and gas industry in 2020, the onshore rig count in Asia-Pacific dropped to 106 in June 2020. However, post COVID-19, with expected improvement in the market, the rig count is likely to grow and drive the market demand.
- Due to the Coronavirus pandemic in 2020, delay in upstream projects can be expected. Later in the forecast period, with the initiation of new projects, the market of DVM is expected to grow considerably.
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North America to Dominate the Market
- The United States is one of the largest producers of crude oil and natural gas, accounting for around 18% and 23% of the global production, respectively, as of 2019. The production surged in 2019, mainly due to robust drilling in its shale reserves, led by the Permian Basin.
- Onshore oil production in the United States accounts for around 84% of the country's oil production and 3% of the country's natural gas production as of 2018. Increased onshore exploration activity in the forecasted period is expected to drive the DVM demand.
- It is expected that around USD 76 billion will be spent on 97 upcoming oil and gas projects in the country between 2018 and 2025 in the United States. With new exploration and drilling projects, MWD and DVM operations can witness considerable growth.
- Despite the decrease in the number of active rig count to 990 in 2019, the upcoming projects and demand for natural gas are expected to drive the drilling market and, subsequently, the application of DVM and Control System.
- Due to the availability of vast shale reserves in the United States and Canada, the number of wells is increasing. The increasing well count is expected to drive the need for DVM in the forecast period.
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