Uproar in Ghana after president unveils his own statue    Putin hails 'courageous' Trump after election win    Israel passes law to deport relatives of attackers, including citizens    Monkey mayhem in South Carolina after 43 primates escape research facility    Russian anti-war teenager faces five years in jail after failed appeal    SR 3.95 million fines for 3 employees of a company and 6-month jail for one for violating Capital Market Law    Qassim emir launches 52 health projects costing a total of SR456 million    BD and INS partner to elevate standards of infusion care in MENAT    Dubai Design Week launches its 10th edition, celebrating creativity and innovation    GASTAT: Passengers of public transport bus and train soar 176% and 33% respectively in 2023    Fakeeh Care Group reports 9M-2024 net profit of SR195.3 million, up 49% y-o-y driven by solid revenue growth and robust profitability    HRT does not impact life expectancy — UK health body    Liam Payne's body to be flown back to the UK    Suspect arrested for banking fraud totaling SR493 million as Nazaha pursues corruption charges    Arab leaders and heads of state congratulate US President-elect Donald Trump    Neymar suffers muscle tear, out for 4-6 weeks    Crown Prince hails Saudi medical team that performed world's first fully robotic heart transplant    Al Nassr secures 5-1 victory over Al Ain to edge closer to knockout stage    Al Ahli extends perfect start with 5-1 victory over Al Shorta    Mitrovic's hat-trick leads Al Hilal to 3-0 victory over Esteghlal    India puts blockbuster Pakistani film on hold    The Vikings and the Islamic world    Filipino pilgrim's incredible evolution from an enemy of Islam to its staunch advocate    Muted Eid celebrations for millions of Nigerian Muslims    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Oil and gas drilling set for at least a 20-year low in 2020
Published in The Saudi Gazette on 14 - 07 - 2020

The COVID-19 pandemic has stymied oil and gas activity, a phenomena which has now affected the drilling market both in terms of wells drilled and in terms of related demand for drilling equipment.
A Rystad Energy analysis shows the number of drilled wells globally is expected to reach around 55,350 this year, the lowest since at least the beginning of the century.
The decline is a staggering 23% fall from 2019's number of 71,946 wells. Our forecast, which extends to 2025, does not find it likely that last year's number will be met or exceeded within the considered time frame.
Drilled wells are expected to partly recover to just above 61,000 in 2021, as governments ease travel restrictions, boosting oil demand and prices. Then numbers will rise further to just above 65,000 in 2022 and remain just below 69,000 until the end of 2025.
North America is likely to be most affected, with the country's rig count already down to historic lows just a few months into the downturn. Although modest recovery is possible in 2H20, drilling activity will remain more than 50% below the levels seen at the same time last year.
From the 55,350 wells to be drilled in 2020, 2,238 are offshore and 53,112 onshore. Before Covid-19 struck, Rystad Energy had expected total wells to rise year-over-year to 74,575, of which 2,896 would be offshore wells and 71,679 onshore wells.
"Both new wells and drilling lengths will be pared down as E&P's scale down investments, affecting the entire supply chain associated with these services. This includes drilling tools, which will decline by 35% in 2020 compared to 2019," said Reza Hassan Kazmi, energy services analyst at Rystad Energy.
When looking at drilling tools, we include blowout preventers (BOPs), downhole drilling tools, drill bits, drill pipe, jars, drill collars and other drilling tools except downhole pumps used for artificial lift, under the generic service segment.
Drilling length, another key driver for drilling tools, especially for drill pipes, drill collars, heavy-weight drill pipes and drill bits, is also estimated to drop by 25% this year before improving in 2021.
At a more granular level, such as the regional or country level, the percentage decrease in wells will not always result in a proportional reduction in total drilling lengths, as drilling depths per well could greatly vary between different regions and countries.
From the demand standpoint, we expect that onshore and offshore purchases for drilling tools will drop from $16 billion in 2019 to $10 billion in 2020. Besides North America, Africa and Russia will be the biggest contributors to this loss, where purchases will drop by 36% and 27% respectively this year.
Russian operators are likely to delay the drilling of new wells on mature assets to ensure compliance with agreed production cuts, while Sonatrach will cut back most of its spending on projects such as Hassi Messaoud and Tin Fouye-Tabankort.
In the medium term however, as major E&Ps resume developing their lineup of offshore projects in Africa, we expect the demand for drilling tools (especially for drilling risers) to increase.
Overall, onshore markets are expected to recover as early as 2021 and grow at a rate of 7% annually towards 2025, while offshore markets will see some highs and lows and will maintain an overall flattish level towards 2025.
Despite the overall stagnant growth, Brazil, Australia and China will continue to offer exciting opportunities in the short term with 20% to 40% growth prospects for offshore drilling in these countries while the United Kingdom, Guyana and Mexico look promising in the medium to long term.
The United States remains the hotspot for spending on drilling tools onshore, while Norway is expected to top the list for offshore drilling tools spending.
In the onshore market in the US, more than 80% of spending on drilling tools will be spent on shale drilling.
The Permian and the Appalachian basins will drive 60% of total shale spend on drilling tools followed by some conventional activity in other basins. Off the coast of Norway, Troll, Balder/Ringhorne and Johan Sverdrup will drive the demand for drilling tools. — Rystad Energy


Clic here to read the story from its source.