Enjoy complimentary customisation on priority with our Enterprise License!
The drilling rig market is estimated to grow by USD 15.36 billion at a CAGR of 6.16% between 2022 and 2027. Various factors are playing a crucial role in driving the growth of the market, which includes a considerable increase in the demand for oil and gas, augmented investments in the upstream oil and gas sector, and a shift in focus towards unconventional oil and gas exploration and production activities. These factors are contributing significantly to the expansion of the market. This market research and growth report includes key drivers, trends, and challenges during the forecasted period.
To learn more about this report, Download Report Sample
The market encompasses the exploration and production of petroleum resources, particularly in untapped regions, where oil and gas discoveries continue to be made in challenging environments. These environments include shallow water, deep water, and ultra-deep water. Drilling rigs, such as jack up rigs, Semi submersible rigs, and drill ship, play a crucial role in accessing these resources. Operational companies are constantly innovating and investing in drilling technologies to mitigate environmental concerns and improve infrastructure efficiency. For instance, the Winterfell Project, a first-of-its-kind drilling operation, employs advanced technologies to extract natural gas from deepwater and ultra-deepwater reservoirs. As natural gas consumption continues to rise, the demand in the exploration and production of these resources is expected to grow. The market is dynamic, with ongoing advancements in drilling technologies and the discovery of new offshore discoveries in various regions. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increase in oil and gas demand is notably driving market growth. Countries such as China and India are witnessing rising industrialization and urbanization. As developing countries are urbanizing rapidly, they are also witnessing substantial growth in the demand for energy. This has significantly increased the demand globally.
Subsequently, oil and gas E&P companies are increasing their drilling activities to boost the production of oil and gas to meet the increasing demand. Due to this, the global active rig count is increasing. Therefore, the rise in the global demand will fuel these activities. This, in turn, will drive the market growth and trends during the forecast period.
The rise in deep-water and ultra-deepwater E&P activities is an emerging market trend. Upstream oil and gas companies have been exploring deep-water and ultra-deepwater resources due to the presence of large untapped reserves. Also, the depletion of resources in easily accessible locations, such as onshore has led oil and gas E&P companies to look for less explored areas, such as deep-water and ultra-deepwater. These projects are becoming more financially viable because of the increase in global crude oil prices.
According to an estimate by the US EIA, global offshore deep-water oil production will increase by 2.7 mbpd between 2017 and 2040. Offshore oil and gas investments are expected to grow at a CAGR of 11.78% during 2018-2021. The rise in these activities in offshore deepwater and ultra-deep-water oil and gas wells will stimulate the demand during the forecast period, thereby driving the growth of the market in focus.
Fluctuations in global crude oil prices are a major challenge impeding market growth. Investment decisions and profits of upstream companies depend entirely on the prices of oil and gas. Hence, any fluctuations in the prices of oil and gas will adversely affect their revenues. Fluctuations in crude oil prices can also lead to the cancelation or rescheduling of oil and gas E&P projects.
During 2020, crude oil prices consistently declined due to a supply-demand imbalance. However, in 2021 prices were increased. Such instances influence the profitability and performance of oil and gas E&P companies. This results in slow growth or even a decline in E&P activities, including delays and cancellations of drilling projects. All these factors are hindering the growth of the market.
The market growth and forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market research and growth report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
The market encompasses various types of advanced equipment, including drillships and jack up rigs, employed in exploration activities for crude oil and natural gas in challenging environments. They utilize the technologies such as artificial neural networks and machine learning to optimize drilling activities and improve operational efficiency. The market is driven by investment initiatives from energy companies to expand infrastructure in deepwater and offshore areas, where hydrocarbon reserves are abundant. Drillships, equipped with dynamic positioning systems, enable drilling in deeper waters and harsher marine environments. The first oil from these discoveries requires significant fossil fuel consumption, necessitating the need for advanced drilling techniques to minimize environmental effects and ensure compliance with regulatory requirements. Offshore infrastructure development and the increasing natural gas requirement further bolster market growth.
The market share growth by the onshore segment will be significant during the forecast period. Onshore drilling rigs, also known as land drilling rigs, are available in different sizes and power capabilities based on their applications. The demand for these rigs is increasing due to the growth in shale drilling, directional drilling, multilateral drilling, and sour good drilling.
Get a glance at the market contribution of various segments Request a PDF Sample
The onshore segment showed a gradual increase in the market share of USD 33.85 billion in 2017 and continued to grow by 2021. The onshore segment is capable of handling more pressure in adverse ambient environments and are more efficient, which is leading to their higher demand. Also, the operating cost of these activities is relatively lower than offshore oil and gas drilling activities, as the latter needs advanced technologies and equipment for drilling deeper wells in harsh environmental conditions. Such benefits are driving the growth of the segment.
For more insights on the market share of various regions Request PDF Sample now!
North America is estimated to contribute 37% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The North American market has experienced substantial growth, driven primarily by the US and Canada, two major producers. The rise of unconventional exploration and production (E&P) activities, including shale production in the US and oil sands in Canada, has significantly increased crude oil and gas output. This development is also fueling its demand. In particular, the use of semi-submersible rigs in shallow water and shelf drilling has become prevalent. Pipelines and storage facilities are essential infrastructure for transporting and storing the extracted resources. Streamlined permitting processes and advanced subsea systems enable efficient drilling in ultra deepwater and untapped regions. Notable projects, such as the Winterfell and Ultra Water initiatives, showcase the industry's commitment to innovation and expansion.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product launches, to enhance their presence in the market.
Archer Ltd. - The company operates a fleet of AC-powered land drilling-rigs in Latin America.
The market forecasting report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market encompasses a wide range of technologies and services, including challenge, crude, and drilling ships, as well as Onshore and Offshore rigs. These rigs are essential for extracting natural resources, particularly oil and natural gas, from the earth. The market is driven by various factors, such as increasing energy demand, technological advancements, and government regulations. Challenge rigs, for instance, are used for drilling in extreme conditions, such as Arctic regions. Crude drilling rigs, on the other hand, are designed for deep waters.
Onshore rigs are used for drilling in land areas, while offshore rigs are used for drilling in the ocean. The use of advanced technologies, such as automation and remote operations, is becoming increasingly common in the drilling rig industry. This not only enhances safety and efficiency but also reduces operational costs. The market is expected to grow significantly in the coming years due to the increasing demand for energy and the ongoing exploration and production activities. In conclusion, the market plays a crucial role in the energy sector by providing the necessary infrastructure for extracting natural resources. The market is driven by various factors, including technological advancements, increasing energy demand, and government regulations. The use of advanced technologies is becoming increasingly common, enhancing safety, efficiency, and reducing operational costs.
The market is propelled by the demand for energy resources, particularly in Deepwater and ultra deepwater activities locations, where exploration and production activities are challenging yet essential for accessing significant oil and gas reserves. The drill ship and offshore drilling rigs play a crucial role in these operations, enabling well intervention and extraction in marine environments. With the increasing fossil fuel requirements, there are substantial investment opportunities in offshore exploration and production activities, especially in ultra deep water regions. The market's growth is further driven by advancements in technology, allowing operations at greater operating depths while ensuring safety and efficiency. Despite challenges, the global market remains pivotal in meeting global energy demands and driving hydrocarbon exploration in offshore areas.
The market analysis and report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Market Scope |
|
Market Report Coverage |
Details |
Page number |
167 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 6.16% |
Market growth 2023-2027 |
USD 15.36 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.15 |
Regional analysis |
North America, Middle East and Africa, Europe, APAC, and South America |
Performing market contribution |
North America at 37% |
Key countries |
US, Canada, Saudi Arabia, China, and Russia |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
AP Moller Maersk AS, Archer Ltd., China Oilfield Services Ltd., Eni Spa, Helmerich and Payne Inc., KCA Deutag Alpha Ltd., Loews Corp., Nabors Industries Ltd., Noble Corp., NOV Inc., ParkerDrilling Co., Patterson UTI Energy Inc., PR Marriott-Drilling Ltd., Precision-Drilling Corp., Schlumberger Ltd., Seadrill Ltd., Stena AB, Transocean Ltd., Valaris Plc, and Weatherford International Plc |
Market dynamics |
Parent market trends and analysis, market growth inducers and obstacles, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
Customization purview |
If our market growth analysis report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Get lifetime access to our
Technavio Insights
Cookie Policy
The Site uses cookies to record users' preferences in relation to the functionality of accessibility. We, our Affiliates, and our Vendors may store and access cookies on a device, and process personal data including unique identifiers sent by a device, to personalise content, tailor, and report on advertising and to analyse our traffic. By clicking “I’m fine with this”, you are allowing the use of these cookies. Please refer to the help guide of your browser for further information on cookies, including how to disable them. Review our Privacy & Cookie Notice.