Global OFS expenditure to rise by 21% in 2017, following a continued recovery in the onshore US sector
Continued improvement in the US onshore sector into the second half of 2017 is expected to support a recovery in global DWS expenditure, according to Westwood Global Energy Group’s latest World Drilling & Well Services Market Forecast report (previously the World Oilfield Services Market Forecast report).
Global Drilling & Well Services Expenditure by Region 2012-2021
- Total market of $1,177bn over the 2017-2021 forecast period.
- Global onshore and offshore expenditure are forecast to rise at a 9% and 2% CAGR, respectively.
- North America is forecast to increase its share of the onshore market from 48% over 2012-2016 to 51% over 2017-2021.
- Rig & crew services will account for 30% of global DWS expenditure over 2017-2021.
- Expenditure on stimulation services is forecast to rise at a 17% CAGR through to 2021.
- A decline in day rates for mobile offshore drilling units (MODUs), and reduced project sanctioning as a result of the downturn, is expected to limit growth in the offshore DWS market over the forecast.
Westwood Global Energy Group’s World Drilling & Well Services Market Forecast – previously known as the World Oilfield Services Market Forecast – presents the latest view on prospects for one of the largest areas of total oilfield services expenditure. Total expenditure is now expected to amount to $1,177bn over the 2017-2021 forecast period, a downward revision of 0.7% compared to the previous quarterly edition of the report.
An expected recovery in the North American onshore sector remains the key driver for growth in the global DWS market over the forecast, with Westwood’s forecast for North American onshore expenditure over 2017-2021 having increased marginally by 0.5% compared with the previous quarter. The US onshore rig count has continued to improve over the past three months as idle units are re-activated to satisfy rising demand.
Outside of North America, international DWS expenditure over 2017-2021 will total approximately $700bn, with a 2% CAGR. However, since the previous quarter, Westwood has made downward revisions to its outlook for Asian offshore drilling activity in China, Malaysia, and Thailand, due to ongoing constraints to operator budgets. This has contributed to a reduction in growth for offshore expenditure in this region but the outlook remains positive with an expected CAGR of 5.4%. Eastern Europe will overtake Asia and become the second largest market in terms of total onshore expenditure over 2017-2021.