Crude oil price started to rise after mid-2016, and the offshore oil & gas industry started to stabilize with lower decline in offshore rig count compared to 2014 and 2015, and hence, a similar trend was observed in the subsea well intervention market. The number of offshore drilling units purchased increased in 2017. Crude oil price crossed USD 60 per barrel mark in November 2017. The opening of coastal water in the United States for exploration and production and the recovery of the Brazilian oil & gas industry, along with increasing crude oil price, are expected to increase the demand for subsea well intervention.
During the downturn in the oil & gas industry, investment was made in smart well technologies to approach a zero-intervention goal. Real-time downhole data can be gathered from smart wells. The technology has not been adopted widely till now due to its complexity, reliability, and capital costs, which have led to the cautious attitude in its use, except in the areas where benefits can be established. Even though smart well technology works to reduce the need for intervention, the data gathered from it has helped to give greater certainty for selecting appropriate intervention response. During the forecast period, smart wells are not expected to largely affect the well intervention market, but as the technology grows and becomes cost-effective and less complex, the market can be hindered in the long run.
The deepwater drilling market is expected to rebound in the near future due to the increased activity in the Golden Triangle – Gulf of Mexico, Brazil, and West Africa. Chevron’s Ballymore and Shell’s giant Whale discovery in the Gulf of Mexico represents the sign of regional deepwater revival, after a long time without any major discovery. The discovery of Egypt’s mammoth offshore natural gas field “Zohr” is expected to increase the demand for well intervention. Several large offshore drilling projects in countries, like Mozambique and Nigeria, are further expected to drive the market.
The United Kingdom and Norway experienced a decline in crude oil production since the start of the century. But in 2015, the trend changed and an increase in production was witnessed in both the countries. In 2016, production in the United Kingdom increased by 18% and in Norway by 5.6% from 2014. Further, the production is expected to ramp up in Norway after the Johan Sverdrup field, one of the major fields, starts production in 2020. The increasing production activity and upcoming new wells are expected to increase well intervention activity, and hence drive the market.
Major Players: Schlumberger Limited, Weatherford International PLC, Baker Hughes A GE Co., Halliburton Company, National Oilwell Varco, Superior Energy Services Inc., Expro Group, Archer, Odfjell Well Services, Axis Well Technology, among others.
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