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The oil and gas drilling automation market share is expected to increase by USD 206.7 million from 2020 to 2025, and the market's growth momentum will accelerate at a CAGR of 1.64%.
This oil and gas drilling automation market research report provides valuable insights on the post-COVID-19 impact on the market, which will help companies evaluate their business approaches. Furthermore, this report extensively covers oil and gas drilling automation market segmentation by application (onshore and offshore) and geography (North America, Europe, APAC, MEA, and South America). The oil and gas drilling automation market report also offer information on several market vendors, including ABB Ltd., Akastor ASA, Ensign Energy Services Inc., Honeywell International Inc., Kongsberg Gruppen ASA, Nabors Industries Ltd., National Oilwell Varco Inc., Rockwell Automation Inc., Schlumberger Ltd., and Siemens AG among others.
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The O&G price recovery is notably driving the oil and gas drilling automation market growth, although factors such as high ownership costs may impede the market growth. Our research analysts have studied the historical data and deduced the key market drivers and the COVID-19 pandemic impact on the oil and gas drilling automation industry. The holistic analysis of the drivers will help in deducing end goals and refining marketing strategies to gain a competitive edge.
Key Oil And Gas Drilling Automation Market Driver
O&G price recovery is a major driver fueling the oil and gas drilling automation market growth. Since 2019, the moderate recovery in crude oil prices has spurred growth in oil and gas (O&G) extraction projects in countries such as the US, Saudi Arabia, Oman, and Kuwait. Rapid fluctuations in crude oil prices adversely impacted the economic activities in oil-dependent regions such as the Middle East during 2016-2019. Owing to factors such as the limited production of crude oil in key oil-producing countries, such as the US and Russia, and geopolitical factors, such as the US-China trade war, oil prices witnessed considerable stability in 2019. Additionally, the restoration of oil production facilities in Saudi Arabia to full capacity is expected to cater to the global demand for O&G at stable prices during the forecast period.Owing to rapid advances in automation and system integration technologies, automated drilling solutions are finding increased adoption in onshore and offshore oil and gas sites. Offshore rigs are equipped with cybernetics systems to improve equipment manipulation and automate key processes such as pipe handling, jacking, and fixation. Therefore, the recovery in crude oil prices is expected to drive the adoption of O&G drilling automation solutions globally during the forecast period.
Key Oil And Gas Drilling Automation Market Trend
The adoption of IoT technology is the major trend influencing the oil and gas drilling automation market growth. The adoption of the internet of things (IoT) devices for in-depth monitoring and data capturing in the O&G industry is improving the overall efficiency of O&G operations. With crude oil prices registering considerable recovery over the last two years, rig operators and oil producers are emphasizing optimizing the energy efficiency of oilfields. IoT devices are being increasingly used in the O&G industry for a range of applications, including drilling management, pipeline testing, and monitoring, among others. IoT enables oil rig operators and refineries to monitor key performance parameters such as pipe pressure and flow rate. Additionally, IoT ensures accurate and real-time data collection at locations that are not easily accessible. Smart devices provide notifications in advance to operators about any drilling errors or incorrect measurements, thereby minimizing the requirement for routine manual inspections. Advances in connected technologies such as low-power wide-area networks (LPWAN) enable connectivity between monitoring sensors in remote offshore applications. Therefore, the rising adoption of IoT in drilling activities is expected to drive the growth of the global O&G drilling automation market during the forecast period.
Key Oil And Gas Drilling Automation Market Challenge
High ownership costs are a major hindrance to the oil and gas drilling automation market growth. The high costs of automated equipment and technologies have been a significant limitation to the growth of the global O&G drilling automation market in the last few years. Drilling automation involves considerable initial costs related to the installation of equipment and software. Additionally, owing to factors such as the lack of equipment standardization and limited software interoperability, several rig operators opt for semi-automated drilling operations that require the retention of trained manpower. Subsequently, although drilling automation improves operational efficiency and minimizes the requirement of human labor, especially in remote offshore environments. The lack of interoperability between different equipment in a specific system also contributes to the overall ownership costs for rig operators. Several vendors offer semi-automated systems for various applications, such as drill floor optimization, and the equipment installed in these semi-automated systems are vendor-specific and only compatible with the automation solutions provided by the same equipment manufacturing vendors. Thus, the high ownership costs associated with the setup, installation, and replacement of automated equipment and software are expected to continue to restrict the growth of the global O&G drilling automation market during the forecast period.
This oil and gas drilling automation market analysis report also provides detailed information on other upcoming trends and challenges that will have a far-reaching effect on the market growth. The actionable insights on the trends and challenges will help companies evaluate and develop growth strategies for 2021-2025.
Technavio categorizes the global oil and gas drilling automation market as a part of the global industrial machinery market. Our research report has extensively covered external factors influencing the parent market growth potential in the coming years, which will determine the levels of growth of the oil and gas drilling automation market during the forecast period.
The parent global industrial machinery market covers companies engaged in manufacturing of industrial machinery and components covering presses, machine tools, compressors, pollution control equipment, elevators, escalators, insulators, pumps, roller bearings, and other metal fabrications. The global industrial machinery market was valued at $2,561.67 billion in 2020 and is expected to grow at a moderate pace.
The report analyzes the market's competitive landscape and offers information on several market vendors, including:
This statistical study of the oil and gas drilling automation market encompasses successful business strategies deployed by the key vendors. The oil and gas drilling automation market is fragmented and the vendors are deploying growth strategies such as organic and inorganic strategies to compete in the market.
To make the most of the opportunities and recover from post COVID-19 impact, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.
The oil and gas drilling automation market forecast report offers in-depth insights into key vendor profiles. The profiles include information on the production, sustainability, and prospects of the leading companies.
Our report provides extensive information on the value chain analysis for the oil and gas drilling automation market, which vendors can leverage to gain a competitive advantage during the forecast period. The end-to-end understanding of the value chain is essential in profit margin optimization and evaluation of business strategies. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.
The value chain of global industrial machinery market includes the following core components:
The report has further elucidated on other innovative approaches being followed by manufacturers to ensure a sustainable market presence.
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31% of the market's growth will originate from North America during the forecast period.The US and Canada are the key markets for oil and gas drilling automation market in North America. Market growth in this region will be faster/slower than the growth of the market in regions.
Recovery in crude oil prices and the significant growth in shale oil production in the US will facilitate the oil and gas drilling automation market growth in North America over the forecast period. This market research report entails detailed information on the competitive intelligence, marketing gaps, and regional opportunities in store for vendors, which will assist in creating efficient business plans.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Five Forces Analysis
5 Market Segmentation by Application
6 Customer landscape
7 Geographic Landscape
8 Drivers, Challenges, and Trends
9 Vendor Landscape
10 Vendor Analysis
11 Appendix
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