Market Trends of Oil and Gas Magnetic Ranging Industry
This section covers the major market trends shaping the Oil & Gas Magnetic Ranging Market according to our research experts:
Onshore Segment to Dominate the Demand
- Magnetic ranging refers to the determination of the relative position of one well with respect to other using magnetic measurements. It is used for several oil field applications, including positioning blow-out relief wells, steam-assisted gravity drainage, heavy oil applications, and planned intersection of one well with another.
- The depletion of easy oil is making the oil and gas industries shift towards other options like heavy oil and bitumen. The production of heavy hydrocarbons requires assisted drainage, which is driving the need for magnetic ranging.
- Projects in coal bed methane fields like vertical to the horizontal intersection, horizontal to horizontal, good connection for pipeline crossing/utility crossing, and deep geothermal wellbore connections are also increasing the market demand.
- Although global heavy oil production witnessed a drop in 2019 to 11.6 million barrels per day, with upcoming deepwater projects, horizontal drilling and increasing CBM projects, the magnetic ranging market is expected to grow significantly.
- New heavy oil fields in Iraq, such as Sheike Adi, Najmah, and Qayara, are expected to be brought on stream by the end of 2020. The projects can witness magnetic ranging applications in the longer run.
- With countries like Canada, Venezuela, Russia, and China having ample reserves of heavy oil, the market demand for magnetic ranging can witness significant growth in the onshore sector.
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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, in 2019. Already with 8390 drilled incomplete wells, new projects are expected to come online in the forecast period.
- 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, steam-assisted gravity drainage is increasing in such fields, which requires efficient magnetic ranging results.
- Several oil sands projects in Canada, such as the Sepiko Kesik and Jackfish East Expansion projects that were scheduled to start up between 2018 and 2020, have been postponed posting 2023, resulting in the slow growth of the market.
- 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, the magnetic ranging market is likely to grow significantly.
- Due to the availability of vast shale and heavy oil reserves in the United States and Canada, the number of wells is increasing. Additionally, the natural energy of wells is depleting, requiring assisted drainage, which is expected to drive the need for Magnetic ranging in the forecast period.
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