North America Perforating Gun Market - Growth, Trends, COVID-19 Impact and Forecasts (2022 - 2027)

North America Perforating Gun Market - Growth, Trends, COVID-19 Impact and Forecasts (2022 - 2027)

The North America perforating gun market is expected to register a CAGR of more than 6% during the forecast period, 2022–2027. The COVID-19 outbreak in Q1 of 2020 affected the growth of the oil and gas industry with declined investments. This had a direct impact on the oil and gas industry, especially in the production activities, which curbed the market for perforating guns. For instance, companies like ExxonMobil, and Shell cumulative decreased their expenditure by around 22% in 2020, thus impacting the market studied. Factors such as the rise in oil and gas drilling activities in the North American region, increased shale gas exploration, and technological developments in perforating gun systems are expected to drive the perforating gun market during the forecast period. However, a shift toward renewable energy sources to fulfill energy demand due to increasing concerns about emissions and global warming are likely to restrain the perforating gun market during the forecast period..

Key Highlights

• The horizontal and deviated well segment is expected to provide a huge thrust to the perforating gun market owing to the increasing well development activities in comparison to vertical wells.
• The discovery of new oil and gas fields discoveries and the reperforation of old wells are expected to provide opportunities for the perforation gun market.
• The United States is one of the largest markets for perforating guns mainly due to increased exploration and production activities in its tight oil and shale reserves.

Key Market TrendsHorizontal and Deviated Well Segment to Dominate the Market

• The horizontal well development is gaining popularity, owing to the benefits associated with the same and technological advancements that have led to the increased economic viability.
• Drilling in shale reserves involves directional or horizontal drilling, which leads to increased contact with the pay zone, as well as advanced production. Hence, a growing focus on unconventional reserves is expected to be a significant driver for the perforating gun market during the forecast period.
• With a growing trend of multilateral wells, the demand for horizontal drilling activity is increasing in offshore regions, which, in turn, is driving the North American market. Technological innovations and the increasing efficiency of horizontal drilling and multi-stage hydraulic fracturing technologies are unlocking vast unconventional shale and tight hydrocarbon resources in North America.
• As of September 2022, horizontal wells accounted for about 97% of the US crude oil production. This, along with upcoming horizontal well projects, is expected to support the growth of the segment in the upcoming years.
• Countries such as Mexico has started to explore the commercial viability of their shale reserves. Hence, with the rising exploration and production of shale oil and gas through horizontal drilling, the perforating gun market is also expected to witness a significant demand.
• Therefore, owing to the above points, the horizontal and deviated well segment is expected to witness dominant growth during the forecast period.

United States to Dominate the Market

• Drilling activities in the United States have increased amid the rising oil and gas demand. The shift from vertical to horizontal wells is the most significant change over the last decade in the region, allowing for greater formation access while only incrementally increasing the cost of the well. The surge in drilling activities has created optimism in the United States oil and gas market and hence may be considered a good sign for perforating gun markets.
• The United States rig count reached 759 in 2022 comprising of 741 land rigs, 15 offshore rigs, and three inland water rigs. As the United States invested heavily in expanding its oil and gas production capacity, the Gulf of Mexico has become a global hotspot for gun services. As of 2021, the Gulf of Mexico region is responsible for 97% and 15% of the US offshore and total hydrocarbon production, respectively. The region has one of the highest global densities for the Gun Perforation Market.
• As of 2021, crude oil production in the United States has increased by approximately 40% compared to 2014, mainly due to increased exploitation of shale reserves through horizontal drilling and hydraulic fracturing. Permian is the leading one of the highest investments among basins due to its low wellhead breakeven price compared to other basins. Permian accounted for the largest share of the new oil produced in recent times.
• Also, the Gulf of Mexico has started to witness a sign of recovery as new projects are coming up. Ongoing oil and gas investments in deepwater and ultra-deepwater drilling activities, such as one by Shell Offshore for Vito in the Gulf of Mexico, are expected to create new avenues for the perforating gun market in the country.
• Therefore, United States production has developed significantly, and the growing shale industry in the country is expected to create a significant amount of opportunities for the oilfield service providers engaged in the perforating gun market.

Competitive Landscape

The North America Perforating Gun market is moderately fragmented. The key players in the market include Baker Hughes Company, Schlumberger Limited, Weatherford International PLC, NOV Inc., and Halliburton Company among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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