The report categorizes the global wellhead equipment market by application (onshore and offshore) and by components (hangers, flanges, and choke). The report also determines the geographic breakdown of the market in terms of detailed analysis and impact, which includes key geographies such as APAC, the Americas, and EMEA.
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Market driver: rising number of unconventional oil and gas resources
The entire upstream sector is highly dependent on the crude oil price and reflects the global supply‐demand balance, which is also influenced by several macroeconomic and political factors. Unconventional energy resources refer to the crude oil and natural gas found in shale formations and oil sands. Coalbed methane is another unconventional source of energy that has gained prominence in the recent times. It is found in coal seams or the coal deposits. Unconventional energy sources have received substantial stimulus in the past decade.
According to Thanikachalam Chandrasekaran, a lead analyst at Technavio for oil and gas research, “Increased shale exploration is being witnessed in developing regions such as China and India. Several upcoming projects have been undertaken by the national oil companies of each country. The increase in the drilling and production of the crude oil from unconventional sources is due to the technological innovation that has brought down the cost of drilling from tight formations.”
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Market trend: varying reservoir characteristics
Each reservoir has its specific characteristics according to the formation and the layer of the traps. The reservoir characteristics have an impact on the production of any well that ultimately decides the types of well drilling and completion tools that would be used during the operations. The composition and purity of crude oil, the character of the reservoir rock, and the nature and strength of the drive mechanism influence the flow rate and the ultimate productivity of a reservoir. Reservoir depth, orientation, and complexity are the key factors that determine the cost and complexity of drilling and completion of a well.
Market challenge: fluctuations in oil and gas prices
The continued trend of low crude prices has put additional pressure on the oil and gas service providing companies. Low-profit margins for a continued period result in reduced revenues that directly influence the financial aspect of any company. Low investments in oil and gas projects have reduced the market potential for oil and gas service companies. Integrated oil companies were still able to absorb some of the market pressure, but pure play upstream companies were affected the most.
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Some of the vendors in the market:
- Aker Solutions
- Forum Energy Technologies
- GENERAL ELECTRIC
The global wellhead equipment market is dependent on the upstream oil and gas industry. During the period of high crude oil prices, the market for wellhead equipment witnessed an increased market potential. This was mainly attributed to the increase in exploration and drilling activities across the world. The industry comprises many global players involved in manufacturing wellhead equipment.
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