- The first half of 2017 shows the start of a recovery in the global land drilling market, according to figures from Westwood Global Energy Group (Westwood)
- It predicts that the global number of rigs drilling will increase at a seven per cent compound annual growth rate (CAGR), over the period to 2021
- The recovery is being led by North America, but Latin America is forecast to grow by five per cent CAGR (2017-2021) and rig demand in North Africa and the Middle East (MENA) is expected to grow
- The trend towards more efficient, higher spec rigs will create opportunities for component makers and equipment manufacturers
- Westwood has launched a unique Global Land Rigs tool giving access to international rig data, including hard-to-reach markets
(Aberdeen, UK) – 25 August 2017 – First half figures from Westwood Global Energy Group (Westwood), the energy market research consultancy, shows that the recovery in the global land drilling market, led by North America, is being sustained. The drive, both in the US and internationally, for wells with longer laterals and multiple wells drilled efficiently from larger pads is creating demand for high-horsepower, modern rigs that can minimise time between each well.
Westwood’s analysis shows that the number of rigs drilling around the world is predicted to increase by seven per cent CAGR over the next five years. It expects the global capable fleet size to rise by 154 units over 2017-2021, with North America accounting for 39 per cent of this growth.
Outside North America, the number of rigs drilling in Latin America is forecast to rise at a five per cent CAGR through to 2021, following a significant decline in drilling activity over 2014-2016. This is being driven by a resumption of stalled activity in Mexico, the development of the Vaca Muerta shale play in Argentina and the development of the ITT project and the Olgan field in Ecuador. Rig demand in North Africa and the Middle East (MENA) is expected to grow with the regional capable fleet forecast to increase by 43 units over 2017-2021.
With data on countries outside North America remaining extremely difficult to track, Westwood has launched a Global Land Rigs tool, giving online access to its database of 8,000 land rigs around the world. Covering 345 drilling contractors across 76 countries, it enables users to identify and search for information on individual rigs and contractors.
Steve Robertson, Head of Research, Oilfield Services, at Westwood Global Energy Group, comments: “There are many trends at play in this market. Whilst weekly movements in North America dominate the headlines, we expect significant growth in other territories such as South America and the Middle East, creating opportunities for operators, contractors and equipment manufacturers. However, until now it has been notoriously difficult to get information on what’s happening on the ground there.
“The market outside the USA is inherently more complex – we see a mix of ownership between specialist contractors and E&P companies and a trend towards consolidation of smaller contractors, a number of which have previously been subsidiaries of E&P companies. Recently, we have been supporting a number of E&P companies and OEMs to help them understand the nature and ownership of rig fleets in difficult-to-access countries.”
“The needs of the market are changing. Efficiency and speed is critical when many projects are on the brink of becoming commercially viable. This is driving a preference for more sophisticated, higher spec rigs, with specific component requirements varying by region but also by operator.
“We have a first-hand insight into this market, based on gathering data from operators, contractors and manufacturers over 11 years. This means that we can supply not only a demand forecast for land rigs, but can now also inform our clients on what’s happening on the ground.”
To discover more about Global Land Rigs or to book a demonstration visit https://www.westwoodenergy.com/research/global-land-rigs/.
Westwood Global Energy Group is headquartered in Aberdeen with offices in London, Houston and Singapore and has over 60 employees.
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Notes to Editors
About Westwood Global Energy Group
Westwood Global Energy Group is a leading provider of market research and consulting services for the global energy industry. Its independent insight through research-led consulting, data analysis and subscription services helps clients in the oil and gas sector make better commercial and strategic decisions.
Westwood Global Energy Group (formerly named Energy Software Intelligence Analytics) was formed in January 2015 by Energy Ventures, an energy specialist private equity firm with a vision to build a leading player in the business intelligence and market analytics space. Following an active period of acquisitions in 2015 the group has acquired the operations of Hannon Westwood, Novas Consulting, Richmond Energy Partners, Douglas Westwood and Energent Group Software LLC. With these acquired companies, along with a licensing agreement with JSI Services, the Group has assembled a unique market position in the Upstream E&P market covering both the operator and the supply chain perspectives. The company has more than 600 customers, including many of the world’s largest organisations as well as regional players and investors. To learn more, please visit www.westwoodenergy.com.
Westwood Global Energy Group headquartered in Aberdeen and has offices in London, Houston and Singapore.