As oil and gas production companies look for efficient and cost-effective methods of increasing their output, the well intervention market is set to get a healthy boost.
According to the analysis by Rystad Energy, spending on interventions (a way to extract additional resources from an existing well instead of drilling a new one) is projected to jump by almost 20 percent this year and total $58 billion.
Models by Rystad Energy showed that this is just the start of a surge in the coming years as the focus on efficiency intensifies.
According to independent company, the intervention rate (how many oil and gas wells go through the intervention process) is forecast to reach 17 percent in 2027. “This would total about 260,000 wells globally.”
The analysis showed that more than $11 billion of the total expenditure will be directed to the wireline & perforating segment, while together, intervention units and oilfield chemicals sectors will represent 35 percent.
“In addition, the sum of the investments in coiled tubing, water management, and intervention tools is expected to close 2023 surpassing $20 billion.”
Jenny Feng, supply chain analyst at Rystad Energy, said as oil demand picks up in the second half of this year, operators will look to ramp up production from existing fields, and well interventions will be a vital piece of the puzzle.
“As a quick, efficient, and cost-effective method of maximising existing resources, interventions are going to be a hot topic in the years to come,” he said.
To boost production rather than drill new wells, operators are more likely to undertake intervention into mature assets that have been producing for more than five years, with relatively high production rates which are starting to show signs of decline.
“Onshore interventions in Asia, South America, and Africa will lead the 9 percent growth in activities related to intervention during 2024, a year expected to be significant for the well intervention market.
“North America is projected to account for 64 percent of the total oil and gas wells ready for intervention in 2027, whereas Asia and South America will reach their maximum in 2026, with 41,413 and 9,703 wells respectively.”