Industry Insights

Independent contractors are expected to ramp-up operations in the U.S. and Canada by the last quarter of 2016 hoping the WTI crude oil prices to stabilize by then. The anticipated recovery of onshore activities along with E&P companies striving to meet the current energy demand are also estimated steer growth.

High production costs are estimated to hamper the overall market over the forecast period. Regulatory agencies such as Fund for Wild Nature (FWN) have issued numerous directives concerning petroleum production. This is expected to retard the overall industry, thereby hindering the market growth over the forecast period. Growing atmospheric distress concerning hazardous fumes emission due to exploration is also expected to hinder the market development.

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Grade Insights

API grade products are mostly preferred in normal environment, and conventional basins owing to the easy availability and reduced OpEx to both E&P and contractor companies. Exploration in unconventional and harsh environmental conditions particularly in shale, CBM, and tight reserves are expected to steer premium grade drill pipes demand over the forecast period.

Application Insights

High IRR, high rate of rig activities, low-risk as compared to offshore drilling and significant familiarity of the key operators in the sector has been the key factor responsible for the market penetration in the segment. The petroleum industry witnessed an estimated decline of around 35% to 40% in the overall rig count across all the regional markets.

Momentous development in several offshore locations such as the Golden Triangle which includes the Gulf of Mexico, Brazil, and West Africa, South China Sea and the Persian Gulf are expected to drive demand in the segment over the forecast period. The segment is estimated to witness the fastest growth over the forecast period.

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Regional Insights

Asia Pacific and Central & South America are anticipated to witness above average growth rates over the next nine years. Expected increase in rig activities along with several new field developments including the offshore basins especially in China, Indonesia, Australia and India is expected to drive Asia Pacific drill pipes industry growth.

Competitive Insights

The global drill pipe market is dominated National Oilwell Varco, Inter Drill Asia Ltd., Superior Drill Pipe Manufacturing Inc., DP Master Manufacturing Pte Ltd., Shanghai Hilong Drill Pipe Co. Ltd., TPS TECHNITUBE RÖHRENWERKE GmbH, Tenaris Company, Drill Pipe International LLC, Vallourec and RK Pipe LLC.Owing to the presence of numerous industry participants, the market is considered as moderately fragmented. Major companies have been observed to have initiated frequent M&As in order to gain market share.