Perforating Gun Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024-2030)

Perforating Gun Market Size

Perforating Gun Market Analysis

Rising Unconventional Oil and Gas Resources Drive the Industry

Rapid changes have been observed in methods, modes, and materials utilized for production and distribution in the petroleum industry. Currently, there is an increasing need for alternative resources that can effectively fulfill the rising energy demand due to the maturation of traditional reservoirs. The surging exploration for clean and efficient sources has been made easier by the discovery of unconventional oil and gas deposits. Unconventional oil and gas resources typically consist of oil or natural gas that cannot be extracted or produced using standard methods and must instead be obtained through non-traditional formations.

Despite the fact that the world's remaining conventional resources are still enough to meet current demands, while considering the concern of the future and rising prices, unconventional resources are rapidly becoming more valued and gaining more attention. As a result of decades of production and the widespread utilization of conventional resources, unconventional oil and gas resources are being used more. Shale gas, tight oil, coalbed methane (CBM), tight gas, shale oil, and natural gas hydrates are examples of unconventional deposits.

According to the International Energy Agency, the non-OPEC output will experience a significant increase, rising from 100.0 million barrels per day (b/d) in 2022 to an average of 102.8 million b/d in 2024. Also, there is an expected rise in the average daily consumption of liquid fuels from 99.4 million b/d in 2022 to 102.2 million b/d in 2024. Further, a rise in global oil inventories is expected during the following two years.

While unconventional oil production is projected to represent around 15% of global oil output by 2035. Thus, the expansion of exploration and production due to the rising output of unconventional oil and gas ultimately drives up the demand for perforating guns at exploration sites.

Shale deposits are primarily concentrated in the North American region, with the U.S. leading the local market, as well as in a few regions of Europe and Asia. The U.S. has experienced a shale boom, making it the world's top producer, surpassing Saudi Arabia and Russia, due to expanding shale projects and rising shale oil and gas output from the North Dakota basin, the Permian basin, and Montana's Bakken formations.

Horizontal Well Type Contributes a Larger Share

In 2022, the horizontal well category held a larger revenue share, of around 63%, due to the increased productivity capabilities of horizontal wells, which have encouraged oilfield operators to explore upstream activities related to these wells. Also, due to their advantages and greater economic viability, and technological improvements, horizontal well development is becoming widely preferred. Moreover, this type of drilling increases contact with the pay zone and promotes advanced production. As a result, during the forecast period, an increasing emphasis on unconventional reserves is projected to play a key driving role in the growth of the perforating gun market in this category.

In addition, the need for horizontal drilling activity is rising in offshore locations, due to a growing trend of multilateral wells, coupled with upcoming horizontal well projects, which is boosting the global demand. A number of nations, including China, Mexico, and Argentina, have begun to investigate the commercial feasibility of their shale reserves. Therefore, the market is expected to have a large demand along with the increasing exploration and production of shale oil and gas through horizontal drilling.

Tubing Conveyed Perforation Systems Dominate the Industry

The market is dominated by tubing conveyed perforation systems, with a share of more than 30% in 2022. This is due to their versatility and high operational efficacy. Moreover, guns for these systems are in high demand as a result of the widespread use of tube-conveyed perforating (TCP) methods for underbalanced wells in vertical and deviated applications.

TCP enables well operators to perforate long or widely spaced intervals on a single trip into the well and allows them a chance to run a flow test right away after perforating. Before making significant investments in gravel packing or stimulation, the extent of the wellbore damage can be determined using impulse-type testing procedures.

Moreover, other advantages of TCP include a long reservoir interval that can be perforated by one run, perforation can be done within the underbalanced condition so formation damage can be minimized, larger explosion charges than through a tubing system, and a significant reduction in rig time. Additionally, industry participants are providing TCP perforation guns with cutting-edge features. Thus, these factors are supporting the expansion of the market in this category.

Geographical Analysis

Rising Demand for Oil and Gas Has Led to a Surge in Drilling Activities in North America

The North American market is expected to grow at a CAGR of around 6% during the forecast period.

This can be ascribed to the presence of a large number of rigs and industry players and the rising demand for oil and gas, which has led to a surge in drilling activities in the region. The biggest change over the past 10 years in the area has been the switch from vertical to horizontal wells, which allows for greater access to formations with only a slight increase in well cost. For instance, in Canada, there are around active 139 rigs, whereas the U.S. has 784 active oil and gas rigs in operation. Therefore, it is expected that the increasing drilling activities will boost the need for perforating guns in the region.

Since 2014, the U.S. has boosted its daily crude oil production by around 10%, largely as a result of the increasing use of shale reserves through hydraulic drilling and horizontal drilling. Because of its low-wellhead breakeven price in comparison to other basins, the Permian is one of the highest investment basins. The majority of the additional oil produced in recent years came from the Permian.

Furthermore, the LATAM region contributed a significant revenue share in 2022, to the global market, due to the high production rate of oil and gas. Also, the region's expanding shale industry is expected to increase the number of oilfield service providers in the perforating gun market. For instance, the Vaca Meurta shale basin in Argentina is one of the world's biggest shale reservoirs. Argentina has reserves of 27 billion barrels of shale oil and 23 trillion cubic meters of shale gas.

Additionally, as new initiatives are being undertaken, the Gulf of Mexico has begun to show signs of recovery. Current oil and gas investments in ultra-deepwater and deepwater drilling projects, including Shell Offshore and Vito drilling projects in the Gulf of Mexico, are projected to open up new demands and opportunities for the nation for perforating guns.

Report Breakdown

Based on Type

• Expendable
• Semi-expendable
• Retrievable

Based on Gun Type

• Through Tubing Hollow Carrier Gun System
• Wireline Conveyed Casing Gun System
• Through Tubing Exposed Gun System
• Tubing Conveyed Perforation System

Based on Orientation

• Internal
• External

Based on Explosives

• Cyclotrimethylene Trinitramine (RDX)
• Cyclotetramethylene Trinitramine (HMX)
• Hexanitrosilbene (HNS)

Based on Depth

• Up to 3,000 ft.
• 3,001 – 8,000 ft.
• Above 8,000 ft.

Based on Pressure

• High Pressure
• Low Pressure

Based on Well Type

• Horizontal Well
• Vertical Well

Based on Application

• Onshore
• Offshore

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
• Asia-Pacific
  • Japan
  • China
  • India
  • South Korea
  • Australia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • Saudi Arabia
  • South Africa
  • U.A.E.

Top Perforating Gun Producing Companies