Artificial Lift Systems Market: Introduction
The global artificial lift systems market was valued at ~US$ 8.1 Bn in 2018 and is anticipated to expand at a CAGR of ~5% during the forecast period. In terms of component, the hardware segment accounted for a prominent share of the artificial lift systems market in 2018, due to the high cost of hardware components in artificial lift systems, along with rising demand for artificial lift systems in mature oil and gas fields. Based on system, the electrical submersible pumping (ESP) segment held a major share of the artificial lift systems market in 2018. This can be ascribed to the high demand for ESP systems due to lower operational costs and flexibility in production output. The artificial lift systems market in Middle East & Africa is likely to expand at a substantial pace in the near future, led by the increase in number of mature fields in the region.
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Key Drivers of Artificial Lift Systems Market
Rise in number of mature fields and aging oil & gas wells is estimated to boost the demand for artificial lift systems during the forecast period. Oil & gas production has been increasing in aging fields across the globe. As a result, the production output of these fields is gradually decreasing, owing to the decline in reservoir pressure. Artificial lift systems are deployed in these fields to ramp up the production output. These systems not only help increase reservoir production, but also improve the recovery rate of crude oil and natural gas from these reservoirs.
Growth in investments in the upstream oil & gas sector is also anticipated to drive the demand for artificial lift systems during the forecast period. Increase in investments in the upstream oil & gas sector enables discovery of new fields and drilling of new wells to exploit underlying reserves. However, currently, more than 90% of oil and gas fields require artificial lift systems for production. Thus, increase in investments in the upstream oil & gas sector is estimated to boost the demand for artificial lift systems in the near future. However, volatility in prices of oil and rise in shift toward environment-friendly technologies such as electric vehicles are likely to restrain the artificial lift systems market during the forecast period. Volatility in oil prices can significantly affect investments in the upstream sector of the industry. This, in turn, is projected to hamper the demand for artificial lift systems.
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North America Dominates Artificial Lift Systems Market
North America was the prominent region of the global artificial lift systems market in 2018. The region is anticipated to maintain its dominance during the forecast period. This can be ascribed to the high demand for artificial lift systems, especially in the U.S., due to the increase in production of shale oil and gas in the region. Growth in investments in unconventional resource exploration and production and rise in number of aging fields in Middle East & Africa are driving the demand for artificial lift systems in the region.
Artificial Lift Systems Market – Key Developments
In May 2019, Apergy Corporation announced that Apergy’s UNBRIDLED ESP Systems had successfully installed an electrical submersible pumping (ESP) system in association with Houston-based Reynolds Lift Technologies. The ESP system utilizes a modular permanent magnet motor (PMM), which is powered by the company’s variable speed drive (VSD) SMARTEN for Life. This setup was installed for a mid-continent region customer by both the companies. The VSD employed sought no additional adjustments to its standard configuration, ensuring that the SMARTEN control software and hardware effectively operates for permanent magnet and induction motors.