"Actionable Insights to Fuel Your Growth"
The global drilling services market size was USD 12.88 billion in 2019. The global impact of COVID-19 has been unprecedented and staggering, with extraction services witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market will exhibit a huge decline of -23.8% in 2020. The market is projected to grow from USD 9.82 billion in 2020 to USD 17.44 billion in 2027 at a CAGR of 8.6% in the 2020-2027 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
Energy is the most quintessential need to conduct daily operations across residential, commercial, and industrial infrastructures, among other verticals. Power-producing companies are continuously adapting to different fuels for reliable power generation. Oil & gas have been proven as one of the most abundantly used fuel sources to operate large stations delivering the necessary output. Consequently, drilling services play a pivotal role in extracting the necessary hydrocarbons, metals, minerals, and water from subsurface aquifers. The exploration & production companies choose different extraction profiles to extract the resources at an optimum rate, requiring a wide range of services to safely complete wells at various depths.
Substantial Gaps in Hydrocarbon Supply and Demand amid COVID-19 Pandemic to Diminish Market Growth
The global health emergency caused by the sudden spread of the novel coronavirus or COVID-19 pandemic has adversely impacted the governing dynamics across verticals. Different industries have suffered a significant loss of operations owing to the imposition of strict policies, such as nationwide lockdowns, to curb the transmission of the virus. Furthermore, the overall energy demand from various countries has observed a significant drop owing to the increasing remote operations from homes and the shutdown of large industrial assets. As a result, the outbreak of the contagion has altered the demand for hydrocarbons and obstructed mining operations, leaving the industry in jeopardy.
Additionally, different parameters, such as disruptions in value chains, ongoing crude oil price wars, fluctuating international crude oil prices, unavailability of new investments, declining energy demand, and many others are set to act as governing factors in shaping industry trends during the pandemic situation. For instance, in April 2020, the International Energy Agency (IEA) evaluated that the international crude oil demand is likely to fall by 9.3 million barrels a day in 2020 as compared to the preceding year.
Request a Free sample to learn more about this report.
Continuous Launch of New Tools & Services to Boost Production to Shape Market Dynamics
Various industry key players are continuously striving to perform research & development (R&D) activities to fortify their position & maximize the output, advancing the drilling services market growth. Additionally, these companies are also focusing on integrating advanced solutions with their existing portfolios to evaluate the downhole conditions in real-time for better wellbore optimization. For instance, in November 2019, Weatherford International introduced an innovative line of flow-measurement solutions named ForeSite Flow. The new addition is integrated with the company’s Production 4.0 intelligence solutions to reduce the overall project costs and enable remote real-time evaluation of fluid properties and hydrocarbon production.
New Contracts for Developing Mining Assets and Rising Collaboration Activities to Brighten Industry Outlook
Increasing efforts by numerous companies to produce a significant quantity of metals & minerals is set to unveil new opportunities for extraction companies. Furthermore, the mining industry has also observed various partnership contracts to explore from bulk reserves. For instance, in August 2020, Swick Mining Services Limited received new extraction contracts for mining in MATSA’s copper and BHP’s Olympic Dam mine located in Spain and Australia, respectively. The company is set to undertake a five-year agreement to deliver underground services in Australia along with a five-year contract for the Spanish assets.
Rising Energy Demand Backed by the Construction of New Infrastructures to Aid Growth
Different countries across the globe have observed a substantial spike in the overall energy intake over the last few decades. The setting up of new commercial & industrial infrastructures has propelled the emerging as well as developed economies to generate a huge power demand, fostering the growth of this market. Additionally, the increasing spending across mining, manufacturing, commercial, construction, and many other verticals has led numerous private and public authorities to intensify their efforts to cater to consumers’ power demand during peak hours. For instance, in August 2019, the U.S. Census Bureau reported that the total national spending on construction for public infrastructure amplified by about USD 20 billion in June 2019 as compared to the corresponding period in the previous year.
Developments in the Hydrocarbon Industry & New Oil Field Discoveries to Bolster Market Prospects
The growing investments to explore & produce a bulk volume of hydrocarbons to meet the international energy demand is projected to be one of the key factors augmenting the global drilling industry size. Additionally, the continuous exploration from wildcat wells and the deployment of geological surveys to uncover new capacity reservoirs that can effectively deliver oil production over a longer period are set to generate new opportunities for the industry. For instance, in October 2020, Odfjell Drilling reported obtaining a 15-well contract by the industry giant Equinor to drill and complete wells in the North Sea as part of its Breidablikk project. The new drilling sites are set to be situated offshore Aberdeen and are likely to start from 2022, with expansion over 2.5 years.
Increasing Inclination towards Adoption of Clean Energy Technologies May Obstruct Market Growth
Various governments and organizations have introduced substantial renewable power generation targets to curb carbon discharge, which may hamper the global market. Furthermore, different administrations are also focusing to reduce their dependence on fossil fuels, stoking the adoption of low-emission technologies. For example, in March 2020, the International Renewable Energy Agency (IRENA) announced that the global renewable capacity topped 2.53 terawatt (TW), observing an annual increment of around 175.8 from 2.36 TW in 2018.
Directional Drilling Services to Lead the Market
Based on service, the global market is broadly categorized into directional drilling and non-directional drilling, with the directional segment further divided into measurement while drilling, logging while drilling, rotary steerable system, gyro drilling, magnetic drilling, and others. The global directional drilling services market is likely to lead the industry due to the increased production from highly technical wells in unconventional formations, coupled with the discovery of new reserves in complex reservoirs.
The numerous operational benefits, including cost-effective solutions and a higher rate of penetration (ROP), are anticipated to propel the rotary steerable system (RSS) services segment’s demand.
The LWD service segment is also set to observe significant growth owing to efficient operations, convenient integrations, and the advancing of long-standing technologies.
Low Costs of Drilling & Substantial Recovery Rate to Propel the Onshore Segment
Based on application, the market can be bifurcated into onshore and offshore, with a further segmentation into shallow water, deepwater, and ultra-deepwater. The growth of onshore services is backed by the development of different infrastructures, new bulk potential reserves, and significantly lower extraction costs, among other factors.
The increasing efforts by E&P companies to integrate innovative alternatives to combat challenging issues in various water depths are likely to augment the offshore drilling segment outlook.
To know how our report can help streamline your business, Speak to Analyst
Increasing Global Energy Demand to Help the Oil & Gas Segment Dominate the Market
Based on end-user, this market has been divided into oil & gas, mining, water exploration, and others. Increasing investments in new hydrocarbon assets, the unlocking of new reserves, and significant production targets are set to broaden the horizons of the oil & gas segment.
The mining segment is expected to grow and to display significant growth owing to the implementation of expansion strategies for existing mineral sites, along with the exploitation of new reserves.
The water exploration segment is likely to observe a substantial CAGR over the forecast timeline due to an increase in groundwater exploration projects across different areas.
North America Drilling Services Market Size, 2019 (USD Billion)
To get more information on the regional analysis of this market, Request a Free sample
The market has been analyzed across five major regions, namely, North America, Asia Pacific, Europe, the Middle East & Africa, and Latin or South America. North America is projected to dominate the drilling services market share, owing to the presence of various key industry players, long-standing expertise in exploring complex formations, the presence of large unconventional reserves, and favorable government policies, among other factors. For example, in December 2019, the U.S. Energy Information Administration (EIA) reported that the total proved crude oil reserves in the country totaled 43.8 billion barrels in 2018 as compared to 39.2 billion barrels in 2017, rising by about 11.9% in the one-year period.
The Asia Pacific market is also projected to display a considerable growth rate on account of the rapidly increasing energy demand, growing E&P activities, dependence on coal reserves, and an abundance of metal & mineral reserves. For example, as per the BP Statistical Review of World Energy published in June 2020, the total coal production from China stood at 79.82 exajoules towards the end of 2019, growing from 76.58 exajoules in 2018 and observing an increase of over 4.2% annually.
Furthermore, the Middle East & Africa is also anticipated to be among the leading regions in this market. A huge untapped potential to produce hydrocarbons, low exploration & production costs, availability of reservoirs at shallower depths, and abundant mineral reserves are some of the key factors driving & propelling the regional landscape. In December 2020, for instance, Saudi Aramco, an oil & gas giant situated in Saudi Arabia, announced the discovery of four new oil & gas fields, estimated with high capacity reserves across different parts of the kingdom.
Partnership Agreements & Introduction of New Products to Reinforce Halliburton’s Forte
The global market dynamics are being shaped by different tool & service providing companies delivering solutions at the country, regional, and international levels. These organizations are readily indulging in various collaborative efforts, along with dedicated research & development (R&D) activities, to develop innovative solutions for drilling services. Halliburton Inc. is a U.S.-based servicing company operating in the oil and gas industry across the globe through a chain of subsidiaries and affiliates. The company is focused on increasing its foothold in the hydrocarbon industry by introducing advanced product & service offerings and initiating partnership contracts. For instance, in July 2019, Halliburton introduced an advanced LWD technology integrated with 3D reservoir mapping abilities to perform innovative reservoir characterization. The technology enables accurate and detailed tracking facilities to encounter problematic zones, such as faults, water zones, and local vibrations, to detect precise oil & gas formations to maximize output.
An Infographic Representation of Drilling Services Market
To get information on various segments, share your queries with us
The drilling services market research report highlights the leading regions across the world to offer a better understanding of the market to the user. Furthermore, the report provides insights into the latest industry trends and analyzes technologies that are being deployed at a rapid pace at the global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader to gain an in-depth knowledge about the industry.
Value (USD Billion)
Service; Application; End-User; and Geography
Fortune Business Insights says that the global drilling services market size was USD 12.88 billion in 2019 and is projected to reach USD 17.44 billion by 2027.
In 2019, the North America drilling services market value stood at USD 4.93 billion.
The drilling services market is likely to grow at a CAGR of 8.6%, exhibiting substantial growth over the forecast period (2020-2027).
The oil & gas end-user segment is anticipated to dominate this market during the forecast period.
Rapidly increasing energy demand across different countries, abundant mining reserves, and growing investments to uncover bulk hydrocarbon reserves are some of the key factors driving this market.
Schlumberger, Phoenix Technology Services, Halliburton Inc., and Weatherford International Plc are some of the key participants operating in this market.
North America dominated the market in terms of share in 2019.
Various organizations are investing to encounter new high-potential reserves that can produce over a long period. The discovery of such reserves leads to multiple extraction operations to enhance oil & gas production, generating demand for various types of services.
“Kudos to your team. Thank you very much for your support and agility to answer our questions.”- Europe-based provider of solutions to automate data centre operations.
“We appreciate you and your team taking out time to share the report and data file with us, and we are grateful for the flexibility provided to modify the document as per request. This does help us in our business decision making. We would be pleased to work with you again, and hope to continue our business relationship long into the future.”- India-based manufacturer of industrial and specialty intermediates with a strong global presence.
“I want to first congratulate you on the great work done on the Medical Platforms project. Thank you so much for all your efforts.”- One of the largest cosmetics company in the world.
“Thank you very much. I really appreciate the work your team has done. I feel very comfortable recommending your services to some of the other startups that I’m working with, and will likely establish a good long partnership with you.”- U.S. based startup operating in the cultivated meat market.
“We received the below report on the U.S. market from you. We were very satisfied with the report.”- UGlobal hearing aids manufacturer.
“I just finished my first pass-through of the report. Great work! Thank you!”- U.S. based solar racking solutions provider.
“Thanks again for the great work on our last partnership. We are ramping up a new project to understand the imaging and imaging service and distribution market in the U.S.”- World’s leading advisory firm.
“We feel positive about the results. Based on the presented results, we will do strategic review of this new information and might commission a detailed study on some of the modules included in the report after end of the year. Overall we are very satisfied and please pass on the praise to the team. Thank you for the co-operation!”- Germany based machine construction company.
“Thank you very much for the very good report. I have another requirement on cutting tools, paper crafts and decorative items.”- Japanese manufacturing company of stationery products.
“We are happy with the professionalism of your in-house research team as well as the quality of your research reports. Looking forward to work together on similar projects”- One of the Leading Food Companies in Germany
“We appreciate the teamwork and efficiency for such an exhaustive and comprehensive report. The data offered to us was exactly what we were looking for. Thank you!”- Intuitive Surgical
“I recommend Fortune Business Insights for their honesty and flexibility. Not only that they were very responsive and dealt with all my questions very quickly but they also responded honestly and flexibly to the detailed requests from us in preparing the research report. We value them as a research company worthy of building long-term relationships.”- Major Food Company in Japan
“Well done Fortune Business Insights! The report covered all the points and was very detailed. Looking forward to work together in the future”- Ziering Medical
“It has been a delightful experience working with you guys. Thank you Fortune Business Insights for your efforts and prompt response”- Major Manufacturer of Precision Machine Parts in India
“I had a great experience working with Fortune Business Insights. The report was very accurate and as per my requirements. Very satisfied with the overall report as it has helped me to build strategies for my business”- Hewlett-Packard
“This is regarding the recent report I bought from Fortune Business insights. Remarkable job and great efforts by your research team. I would also like to thank the back end team for offering a continuous support and stitching together a report that is so comprehensive and exhaustive”- Global Management Consulting Firm
“Please pass on our sincere thanks to the whole team at Fortune Business Insights. This is a very good piece of work and will be very helpful to us going forward. We know where we will be getting business intelligence from in the future.”- UK-based Start-up in the Medical Devices Sector
“Thank you for sending the market report and data. It looks quite comprehensive and the data is exactly what I was looking for. I appreciate the timeliness and responsiveness of you and your team.”- One of the Largest Companies in the Defence Industry