Offshore drilling finally set for growth, report claims

Demand for drilling and well services is growing with a total of more than 72,000 wells set to be drilled and completed in 2019, up 3% on 2018, according to analyst Rystad Energy.

Well completion activity hit a low point in 2016 after dropping 44% in just two years but has rebounded by 30% following the steady oil price rise.

Rystad forecasts an average annual growth rate of 4% towards 2021.

Offshore represents a small portion of overall activity, partly because the complexity of developing fields at sea requires fewer and more efficient wells compared with conventional onshore fields.

Rystad pointed out that the offshore market has been slower reacting to improved oil prices, and only next year will offshore investments and associated drilling activity revert to growth.

The North Sea is driving short-term growth for floating rigs, with Brazil and West Africa set to lift demand in the medium term.

As for jack-ups, the main markets will continue to be in the Middle East and Asia.

With offshore drilling reverting to growth, purchases of services look set to grow on average by 9% in the run-up to 2021, the analyst added.

Source: Offshore Magazine