Market Trends of US Wireline Logging Services Industry
Onshore Segment to Dominate the Market
- The United States is one of the largest oil and natural gas producers globally, and nearly 75% of its oil production comes from onshore fields. Most of the country's production comes primarily from the massive onshore shale plays in the country, such as Barnett, Haynesville, Bakken, and Anadarko-Woodford shale plays. The Permian Shale play in West Texas is one of the largest shale plays globally, with the lowest shale development costs.
- According to Baker Hughes Rig Count, as of December 9th, 2022, the United States and Canada had nearly 962 land rigs being deployed, in contrast to the 20 offshore rigs active during the same time. This demonstrates the disparity between new drilling activity in the onshore and offshore segments.
- According to the latest drilling productivity report, as of November 2022, there were nearly 4443 drilled but uncompleted onshore wells, up by almost 0.4% from 4421 drilled but uncompleted onshore wells in September 2022. As most of these wells will require wireline completion, This provides a significant factor driving the market in the country during the forecast period.
- Therefore, the factors above are expected to drive the market in the forecast period, similar to the trend witnessed in recent years.
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Shale gas drilling to drive the market
- The United States is the world's largest shale gas producer, and despite the Covid-19 pandemic, which decimated global hydrocarbon demand forcing fracking crews to suspend operations, the market has been recovering.
- Shale gas is generally produced by hydrofracturing the reservoir to increase the permeability so the gas can easily flow and be produced. Shale gas is usually 95% pure methane and has very less amount of impurities, like sulfur, due to which the processing cost of the shale gas decreases than the natural gas processing cost.
- The U.S. Energy Information Administration (EIA) estimates that in 2021, United States dry natural gas production from shale formations was about 27.2 trillion cubic feet (Tcf) and equal to about 79% of total U.S. dry natural gas production in 2021. Additionally, in 2021, gross withdrawals from shale gas wells stood at nearly 30 Tcf, up by nearly 5.5% year-on-year.
- As the United States has one of the lowest costs of fracking globally, most investors are attracted to invest in the sector, thereby driving the growth of the sector during the forecast period. According to the United States EIA, nearly 95% of all wells drilled in the United States are fracked. As shale wells require fracking and completion services which are mostly done using wirelines, this is expected to drive the market during the forecast period.
