Global Oil & Gas Drill Bit Market by Product (Fixed Cutter, Roller-cone) and Region (North America, Latin America, Europe, Asia Pacific and Middle East & Africa), Forecast To 2028

Industry Insights

The global market for drill bits for oil & gas was 2,835.000 units in 2014. The market has seen significant growth in recent years due to the high rate of fossil fuel extractive to meet rising global energy demand. The significant demand for drill bits has resulted from large-scale drilling and E&P, both inshore and offshore oilfields, especially in the Middle East.

E&P companies have been forced to find hydrocarbons in unconventional resources, such as CBM, shale and tight blocks, due to the depletion of conventional oil & gaz wells. These unconventional reserves require special techniques and equipment to extract hydrocarbons.

North America's drill bits demand reached 1,023.4 thousand units in 2014. It is expected to grow to 100 units by 2022. The CAGR for 2015-2022 was 5.2%. Drill bits are essential equipment for oil and gas extraction. These bits are made from high performance metal compounds, such as tungsten carbide and high-speed steel. They also include synthetic or natural diamonds and polycrystalline diamonds. These bits are coated with special metallic coatings made of cobalt or titanium to increase their durability and wear resistance.

A typical E&P project requires a lot of drilling. This is because effective design and drill bits that are sensitive to case conditions play an important role in the drilling process. Highly optimized operations can be achieved by analyzing complex parameters like drilling medium, rock strength, drilling system, and bottom hole environment. A well-designed bit and thorough material testing can help to reduce costs and increase profitability.

The OEM manufacturers have had to improve their bit designs in response to increasing drilling performance requirements and growing concerns from E&P companies about reducing operating costs due to recent low crude oil prices. Smith Bits has developed a rolling polycrystalline diamond cutter that increases performance and durability under extreme operating conditions.

Future development will be possible due to technological advancements and customer preferences for more cost-effective equipment. Companies are constantly working to improve the expected life span of drill bits and design hybrid extraction equipment.

Product Insights

The largest segment of oil & gas drilling bits was the roller cone drill bits. It accounted for 70.4% market share in 2014. It is projected to have a net worth exceeding USD 1,060.0 million by 2022. Because of their low cost and ability to drill in soft and traditional formations, roller cone segments are expected to dominate the market. It is expected to lose market share to fixed cutters due to increased explorations into unconventional plays and the encountering harder rocks at deeper depths.

The tricone and roller cone bits can also be classified as milled tooth or tungsten carbide inserts. These products can be used in soft formations with greater efficiency than other downhole tools. The development of sealed bearings has seen recent innovations that prevent bearing corrosion and reduce the risk of failure.

Tungsten carbide inserts provide gauge protection and hardfacing to protect downhole equipment against damage from abrasion. Milled-tooth cuttings can be used to scrape in soft formations. However, tungsten carbide inserts increase the overall durability of the equipment against extremely hard formations.

The demand for fixed cutter drill bits was over 320 thousand units in 2014. They are predicted to grow at a CAGR exceeding 5.5% between 2015 and 2022. Because of their greater resistance to extreme hard surfaces, drill bits with diamonds embedded on them are becoming more popular.

PDC fixed cone bits and natural/synthetic cutters are niche market segments that are likely to see high growth in the future. Due to their superior durability and effectiveness, natural/synthetic cutters offer the greatest potential for future investments by industrial participants.

The high penetration rate (ROP) of shale and other sandstone formations and their suitability for a wide range of rock formations is a major reason behind the increasing demand for PDC in these formations. Geology and topography are important factors in selecting the right bit type for specific operations, such as exploration and extraction. PDC's durability allows for more use in oil and gas E&P in Canada and the United States.

Regional Insights

The North American drill bit market was dominant in the global market, accounting for more than 35% of the total market volume in 2014. It is expected to see moderate growth over this forecast period. The increased drilling of shale gas in the region can explain the dominance of the regional market.

In 2012, the government of Italy lifted the ban on offshore drilling and exploration activities. This is likely to have positive effects on the market growth for drill bits. After the discovery of significant petroleum reserves in Egypt's Nile Delta, Italy, the government of Italy renewed an agreement with Egypt. This agreement was to invest funds in the development of the crude oil industry. This agreement will increase Egypt's domestic production of crude oil and fuel the demand for drill bits.

Exploration projects for both onshore and offshore reserves will be driven by rising crude oil and natural gas consumption and large proven reserves in Canada and the Gulf of Mexico. Exploration activities in unconventional formations like shale or CBM will drive demand for durable, efficient drilling equipment and downhole instruments. Over the forecast period, oilfield directional drilling will drive the demand for PDC bits.

Royal Dutch Shell, for example, announced that Appomattox's Deepwater Project received Final Investment Decision (FID), confirmation for further development in Gulf of Mexico. This is expected to increase crude oil production. The project will open up new drilling opportunities as well as opportunities for exploration and drilling.

Asia Pacific is predicted to experience the fastest growth during the forecast period. It is expected that the region will have a net demand exceeding 790,000 units by 2022. Oil consumption is expected to rise due to population growth and an increase in automotive industry growth.

The new exploration and development of reserves is expected to be driven by declining production in conventional oil fields. The high growth in this market can be attributed largely to the increasing demand for oil products from India and China. China has joined forces with Middle East and African companies to build new oil refineries. These projects are expected to have a positive impact on oil product trade balance by being commissioned in Asia Pacific and Middle East.

Oil & Gas Drill Bit Market share Insights

The global market for drill bits in the oil and gas industry is extremely consolidated, with the top five players holding over 70% of the market share. These companies compete on the basis for product differentiation and innovative solutions. As part of their strategy to increase market share and sustain existing competition, some of the largest companies have formed strategic partnerships and acquired small and regional players.

Schlumberger accounted for 22.5% market share in 2014, making it the industry leader. Schlumberger offers a broad range of applications-specific bits, and is always innovating to improve the company's portfolio and keep it at the top of its game.

The OEM manufacturers have had to improve their bit designs in response to increasing drilling performance requirements and growing concerns from E&P companies about reducing operating costs due to the recent drop in crude oil prices. Smith Bits has developed a rolling polycrystalline diamond cutter that increases performance and durability under extreme operating conditions.

There are also other companies in this market: National Oilwell Varco, Halliburton, Baker Huges, Atlas Copco, Varel International, Inc., Torquado Drilling Accessories Inc., Kingdream Public Limited Company.

Up Market Research published a new report titled “Oil & Gas Drill Bit Market research report which is segmented by Product (Fixed Cutter, Roller-cone), By Players/Companies Kingdream Public Limited Company, Torquado Drilling Accessories Inc, Halliburton, Baker Huges, National Oilwell Varco, Inc, Atlas Copco, Varel International”. As per the study the market is expected to grow at a CAGR of XX% in the forecast period.

Report Scope

The report covers comprehensive data on emerging trends, market drivers, growth opportunities, and restraints that can change the market dynamics of the industry. It provides an in-depth analysis of the market segments which include products, applications, and competitor analysis.

Global Oil & Gas Drill Bit Market Report Segments:

The market is segmented by Product (Fixed Cutter, Roller-cone).

Oil & Gas Drill Bit Market research report delivers a close watch on leading competitors with strategic analysis, micro and macro market trend and scenarios, pricing analysis and a holistic overview of the market situations in the forecast period. It is a professional and a detailed report focusing on primary and secondary drivers, market share, leading segments and geographical analysis. Further, key players, major collaborations, merger & acquisitions along with trending innovation and business policies are reviewed in the report.

Key Benefits for Industry Participants & Stakeholders:

• Industry drivers, restraints, and opportunities covered in the study
• Neutral perspective on the market performance
• Recent industry trends and developments
• Competitive landscape & strategies of key players
• Potential & niche segments and regions exhibiting promising growth covered
• Historical, current, and projected market size, in terms of value
• In-depth analysis of the Oil & Gas Drill Bit Market

Overview of the regional outlook of the Oil & Gas Drill Bit Market:

Based on region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & Africa (MEA). North America region is further bifurcated into countries such as U.S., and Canada. The Europe region is further categorized into U.K., France, Germany, Italy, Spain, Russia, and Rest of Europe. Asia Pacific is further segmented into China, Japan, South Korea, India, Australia, South East Asia, and Rest of Asia Pacific. Latin America region is further segmented into Brazil, Mexico, and Rest of Latin America, and the MEA region is further divided into GCC, Turkey, South Africa, and Rest of MEA.

Highlights of The Oil & Gas Drill Bit Market Report:

1. The market structure and projections for the coming years.
2. Drivers, restraints, opportunities, and current trends of Oil & Gas Drill Bit Market.
3. Historical data and forecast.
4. Estimations for the forecast period 2028.
5. Developments and trends in the market.

                1. Fixed Cutter

                2. Roller-cone

7. Market scenario by region, sub-region, and country.
8. Market share of the market players, company profiles, product specifications, SWOT analysis, and competitive landscape.
9. Analysis regarding upstream raw materials, downstream demand, and current market dynamics.
10. Government Policies, Macro & Micro economic factors are also included in the report.

We have studied the Oil & Gas Drill Bit Market in 360 degrees via. both primary & secondary research methodologies. This helped us in building an understanding of the current market dynamics, supply-demand gap, pricing trends, product preferences, consumer patterns & so on. The findings were further validated through primary research with industry experts & opinion leaders across countries. The data is further compiled & validated through various market estimation & data validation methodologies. Further, we also have our in-house data forecasting model to predict market growth up to 2028.

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Reasons to Purchase the Oil & Gas Drill Bit Market Report:

• The report includes a plethora of information such as market dynamics scenario and opportunities during the forecast period
• Segments and sub-segments include quantitative, qualitative, value (USD Million,) and volume (Units Million) data.
• Regional, sub-regional, and country level data includes the demand and supply forces along with their influence on the market.
• The competitive landscape comprises share of key players, new developments, and strategies in the last three years.
• Comprehensive companies offering products, relevant financial information, recent developments, SWOT analysis, and strategies by these players.