Market Trends of North America Oil and Gas Electric Submersible Pump Industry
This section covers the major market trends shaping the North America Oil & Gas Electric Submersible Pump Market according to our research experts:
Onshore Sector to Dominate the Market
- The electric submersible pump (ESP) system is an artificial-lift system that utilizes a downhole pumping system that is electrically driven. The pump typically comprises multiple centrifugal pump sections that can be individually configured ideally for the production and wellbore characteristics of an application.
- Canada has third-largest oil reserves, of which 96% are comprised of oil sands reserves. The sand oil available here is high-density oil and has high sand particle content. Hence, there is a high demand for artificial lift systems, and in turn, for ESPs as they are suitable for lifting high-density fluids.
- Since 2009, the sand oil production rapidly increased, while conventional oil production has witnessed a stagnancy. In 2018, the country recorded a sand oil production of 2.9 million barrels per day.
- In Mexico, the onshore basins are mature, show clear creaming curves for drilling. These mature oilfields are expected to use electric submersible pumps in the blocks to increase the oil output.
- With total crude oil production of 24.6 million barrels per day, the market of oil and gas is growing and simultaneously driving the need for ESP.
- Due to the COVID-19 pandemic, a delay in upstream projects is expected for a short period. Later in the forecast period, with the initiation of new projects and completion of drilled wells, the market of the ESP is expected to grow considerably.
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The United States to Dominate the Market
- The United States was one of the largest producers of crude oil and natural gas, accounting for around 18% and 23% of the global production, respectively, in 2019. The production surged in 2019, mainly due to robust drilling in its shale reserves, led by the Permian Basin.
- 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. Such robust growth in terms of new projects is projected to create a demand for new ESPs systems in the United States, in the longer run.
- As of April 2019, 8390 drilled wells are incomplete in the country, with the Permian Basin having the largest share. These wells are expected to be completed in the coming years, creating ample opportunity for the ESPs system suppliers in the future.
- At the beginning of 2018, the government announced the opening of 98% of the coastal water for oil and gas exploration and production. The announcement is expected to drive the demand for ESP in the offshore sector in the long run.
- Despite the decrease in the number of active rig count to 990 in 2019, the production of both crude oil and natural gas is increasing, driving the market of the ESP significantly.
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