Market Trends of Oilfield Power Generation Industry
This section covers the major market trends shaping the Oilfield Power Generation Market according to our research experts:
Onshore Segment Expected to Dominate the Market
- Oil field operations typically operate away from traditional infrastructure, making it impossible for reliable access to electricity. A lack of existing roadways and communication lines makes it nearly impossible to manage effectively. More commonly, these locations typically lack any access to power. To modernize and add these components, oil field operators would be forced to invest significantly. And, as a result, it is simply not financially feasible. For the above reason, the oilfield power generation methods come in hand, which is more reliable and cost-effective. Companies use various equipment such as diesel and natural gas generators.
- The increasing number of wells at new fields and their exploration require the drilling of several new wells, which require power generation units at every site for the smooth going of the work, decreasing the non-productive time of the site.
- Moreover, the low investment cost in onshore field development than offshore is attracting more investment in onshore, thus driving the oilfield power generation market during the forecast period.
- In 2019, the global natural gas production was 3989.3 billion cubic meters (bcm), higher than the world's production in 2018, 3857.5 bcm. Moreover, in 2019, about 23.3% of the electricity generated worldwide was from natural gas. The increasing demand and production of natural gas over the world are likely to positively impact the more oilfield activities, which is expected to drive the oilfield power generation market.
- In recent years several new oil and gas fields were discovered in the world, in 2019, a new oil field was found in Khuzestan province of Iran, which is expected to have over 50 billion barrels of oil. The development of such newly discovered fields is expected to impact the oilfield power generation market positively.
- Hence, owing to the above points, onshore is likely going to be the largest segment for the oilfield power generation market during the forecast period.
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North America Expected to Dominate the Market
- North America, due to its rapid increase in crude oil and natural gas production in the world, held a significant share in the market. In 2019, North America produced is approximately 24.9% of the global crude oil production.
- Countries in North America have planned to decrease their carbon signature by using cleaner fuel such as natural gas from which the carbon emissions are less. Natural gas energy in the countries in North America already surpassed coal-based power and is likely to take over the energy sector, thus reducing greenhouse gas emissions.
- As of 2019, North America's crude oil production was 1116.5 million tonnes (MT), which was higher than the region produced in 2018, 1042.2 million tonnes (MT). The increase in crude oil production over the year exhibits the need for power generation units in the oilfields to support day to day activities.
- Moreover, the region is suffering heavily from the COVID-19 situation but is expected to regain its inertia slowly after. Oil and gas hold a significant share in North America's economy. With the increasing exploration and production operations offshore by the United States and Mexico, it is likely to drive the oilfield power generation market.
- Hence, due to the above points, North America is expected to be the fastest-growing market for the oilfield power generation during the forecast period.
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