Drilling Services Market Size, Share & COVID-19 Impact Analysis, By Service (Directional Drilling {Measurement While Drilling, Logging While Drilling, Rotary Steerable System, Gyro Drilling, Magnetic Drilling, and Others} and Non-Directional Drilling), By Application (Onshore and Offshore {Shallow Water, Deepwater, and Ultra-Deepwater}), By End-User (Oil & Gas, Mining, Water Exploration, and Others), and Regional Forecast, 2020-2032

The global drilling services market size was USD 12.88 billion in 2019. The market is projected to grow USD 26.84 billion in 2032 at a CAGR of 8.75% in the 2020-2032 period. 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 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.

LATEST TRENDS

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.

DRIVING FACTORS

 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.

RESTRAINING FACTORS

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.

SEGMENTATION

By Service Analysis

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.

By Application Analysis

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.

By End-User Analysis

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.

REGIONAL INSIGHTS

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.

KEY INDUSTRY PLAYERS

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.

LIST OF KEY COMPANIES PROFILED:

• Gyrodata (U.S.)


• Schlumberger (U.S.)


• Stockholm Precision Tools AB (SPT) (Sweden)


• Icefield Tools Corporation (Canada)


• Devico AS (Norway)


• Brownline (The Netherlands)


• Axis Mining Technology (Australia)


• Scientific Drilling (U.S.)


• Inertial Sensing One AB (Sweden)


• Nabors Industries (U.S.)


• Halliburton (U.S.)


• Weatherford (Switzerland)


• TechnipFMC (UK)


• China Oilfield Services Limited (China)


• Oceaneering (U.S.)


• AnTech (UK)


• Compass Directional Guidance, Inc. (U.S.)


• Drill Tech Solution (Azerbaijan)


• Unitech Drilling Company Limited (Nigeria)


• DIDRILLSA LTDA (Colombia)


• VES Survey International (U.S.)


• Archer - the well company (Norway)


• Superior Energy Services (U.S.)


• Baker Hughes (U.S.)


• Petrofac (UK)


• Huracan Pty Ltd. (Australia)


• Leam Drilling Systems LLC (U.S.)


• National Oilwell Varco (U.S.)


• AlMansoori Specialized Engineering (United Arab Emirates)


• NewTech Services (Russia)


• The Weir Group PLC (UK)


• JINDAL DRILLING & INDUSTRIES LTD. (India)


• Boart Longyear (U.S.)


• Integra (Russia)


• IDS LLC (Oman)


• Radial Drilling Services, Inc. (U.S.)


• Welltec (Denmark)


• JAE (Japan)


• KLX Energy Services (U.S.)


• Gyro Drilling (The Netherlands)


• Zupt, LLC (U.S.)


• Center Drill Inc. (U.S.)


• ION Geophysical (U.S.)


• Phoenix Technology Services (Canada)


• Kearfott Corporation (U.S.)


• Gyro Australia (Australia)


• Motive Drilling Technologies (U.S.)


• Oliden Technology (U.S.)


• REFLEX NOW (Australia)


• Erdos Miller (U.S.)


• DV8 Technology Ltd. (UK)


• Schneider Electric (France)


• Siemens (Germany)


• Emerson (U.S.)


• Sumitomo Precision Products Co (Japan)

KEY INDUSTRY DEVELOPMENTS:

• November 2020 – Seadrill Ltd obtained a drilling agreement from Walter Oil & Gas to drill & exploit reserves in the Gulf of Mexico. The contract includes the positioning of a semi-submersible rig that is set to add about USD 17 million to the organization’s backlog revenue.


• November 2020 – Schlumberger introduced MagniSphere, a high-definition NMR logging-while-drilling (LWD) service. The technological advancement is likely to boost hydrocarbon production through accurate reservoir analysis for better extraction in complex formations.

REPORT COVERAGE

An Infographic Representation of Drilling Services Market

View Full Infographic

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.

Report Scope & Segmentation