published Date SEP 2018

Offshore Contract Drilling Market Segmentation by Depth, by Type, and by Geography

Gulf of Mexico, North Sea, Brazilian Waters, and West Africa are attracting offshore investors. Higher crude price, lower breakeven price, declining production from mature fields, and several large new discoveries are the factors driving the global offshore contract drilling market.

September, 2018: The number of offshore rigs contracted had declined by around 56%, between Q1 2014 and Q4 2017. The impact of the rise in prices of commodity had not been universal in the recent past, indicating a surge in onshore drilling activity, and lesser activity in the offshore segment. The number of offshore rigs contracted was constant, and at a historical low, in Q4 2017 and Q1 2018. Offshore rig utilization has declined from 80% in 2014, to around 60% in 2017.

However, the current crude oil price is more than USD 70 per barrels, well above breakeven price of several major offshore regions, such as Gulf of Mexico, North Sea, Brazilian Waters, and West Africa. It has increased the confidence of investors significantly, and the demand for offshore rigs is expected to improve gradually as witnessed in the North Sea in Q1 2018.

The major development in the market is expected to be witnessed after two to three years from now, due to the recent increase in production from the onshore segment, especially from Permian basin, accounting for a major share in the new crude oil produced recently. The shale production is expected to plateau in the next two to three years, and a shift in more focus toward offshore, is likely to become essential in maintaining the demand-supply balance.

The offshore contract drilling market has a high potential for economies of scale, and is capital intensive. In the recent past, contractors focused on economies of scale, rather than on the consolidation of the market, which was the trend before. In the past two years, only three merger and acquisitions activities have been witnessed: Ensco acquired Atwood Oceanics, Transocean acquired Songa Offshore, and Borr Drilling acquired Paragon. Lack of consolidation has been an obstacle for mitigating oversupply and increase in day rates.

The reportOffshore Contract Drilling Market Segmentation by Depth, by Type, and by Geographyis now available, and can be purchased directly at:


Key Insights from the Offshore Contract Drilling Market Report:

  • Currently, the market is flooded with old rigs that are not capable of meeting today’s requirement. Even upgrading of such rigs is capital intensive, resulting in high chances of newer rigs with high-spec to win contracts. The demand for jackups is expected to be driven by regions, such as the Middle East, Europe, and Asia. Meanwhile, Brazil and West Africa are expected to become the catalysts for the semisubmersible and drillships demand.
  • The offshore contract drilling market, in these recent years, has been highly competitive and capital intensive, and is becoming technologically advanced with high-spec. The top four companies account for around 35% of the global market. The downturn in the industry has resulted in average 57% of the decline in the total revenue of these companies, in the past three years.
  • Key players in the market include, Transocean LTD, Seadrill Ltd, ENSCO PLC, Noble Drilling PLC, Diamond Offshore Drilling Inc., China Oilfield Services, Rowan Companies PLC, Maersk Group, Ocean Rig UDW Inc., Saipem SpA, and others.

Offshore Contract Drilling market segmentation, based on depth, type, and regional coverage:

Offshore Contract Drilling Market, by Depth:

  • Shallow
  • Deepwater and Ultradeep water

Offshore Contract Drilling Market, by Type:

  • Jackups
  • Semisubmersibles
  • Drillships
  • Other Types

Offshore Contract Drilling Market, by Region

North America

  • United States
  • Rest of North America


  • Russia
  • Norway
  • United Kingdom
  • Rest of Europe

South America           

  • Brazil
  • Rest of South America    


  • China
  • Australia
  • Indonesia 
  • Rest of Asia-Pacific

Middle East & Africa  

  • Saudi Arabia
  • United Arab Emirates
  • Iran
  • Nigeria
  • Rest of Middle East & Africa

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