Spending on well intervention by oil and gas production companies is likely to rise by 20% this year as companies seek more efficient and cost-effective ways to improve output, according to Rystad Energy on Monday.
To boost production and extract additional resources rather than drill new wells, operators are more likely to undertake intervention in mature assets that have been producing for more than five years and have relatively high production rates that are starting to show signs of decline.
While expenditure for well intervention is projected to total $58 billion in 2023, the intervention rate, which shows how many oil and gas wells go through the intervention process, is forecast to jump 17% in 2027, reaching about 260,000 wells globally.
Onshore interventions in Asia, South America, and Africa will lead the 9% growth in activities related to intervention in 2024, a year that is expected to be significant for the well intervention market.
North America is projected to account for 64% of the total oil and gas wells ready for intervention in 2027, whereas Asia and South America will reach their maximum in 2026, with respectively 41,413 and 9,703 wells.
Algeria and Saudi Arabia are the top two onshore markets, accounting for up to more than 11,000 wells with exceptional intervention opportunities forecast from 2023 until 2028.
Brazil, a country traditionally attractive for offshore explorations, represents almost 17% of the total top five intervention counts, followed by Libya and Indonesia.
‘As oil demand picks up in the second half of this year, operators will look to ramp up production from existing fields, and well interventions will be a vital piece of the puzzle,’ Jenny Feng, supply chain analyst at Rystad Energy, was quoted as saying in the statement.
