Oil and Gas Digital Rock Analysis Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The oil and gas digital rock analysis market is expected to grow at a CAGR of more than 2.5% over the period of 2020-2025. Factors such as an increase in the complexity of production from unconventional reservoirs, rising requirement of enhanced knowledge of the reservoir and formation for multiple horizontal wells require, and increasing production of natural gas is expected to drive the market. However, high cost related to producing high-resolution rock structures is expected to restraint in the market.

Key Highlights

• The oil and gas digital rock analysis market is aided by the increasing complexity of reservoirs and increasing production from new wells as it is able to help, the market players, simulate and analyze better results. Due to its broad base and increasing exploration and production activity, the conventional segment is expected to be the largest segment in the market during the forecast period.
• Gas hydrates production may become an opportunity for the market players as its economically viable production may pose new problems, requiring better digital rock analysis techniques.
• Due to the large reserves of shale oil and gas, North America is expected to be the largest market during the forecast period, with majority demand coming from the United States and Canada.

Key Market Trends

Conventional Segment to Dominate the Market

• Oil and gas digital rock analysis encompass a multi-disciplinary approach involving advanced microscopy and physics combined with geology, geochemistry, petrophysics, and petroleum engineering to understand the pore-scale microstructure of reservoir rock. It may be used to help exploration and production (E&P) operators to reduce risk, increase the production of hydrocarbon, and improve the recovery from the well. Its improvements made over the conventional methods are expected to aid its growth in the market.
• Unlike traditional core analysis, which works on the assumption that homogeneous rock samples comprise a single distinguishable rock-type, digital core analysis allows for a detailed assessment of the heterogeneity and classification of a core's physical properties. This leads to more robust calibrations of well-logging data as well as a better understanding of mechanisms correlating different physical measurements, thus reducing uncertainty. An increase in the reliability of the system's data over the traditional methods may boost the market.
• Advancements are being made in the application of super-resolution and machine-learning techniques in the process of reservoir characterization to quantify uncertainty stemming from small-scale details, which may help develop efficient numerical algorithms to test and challenge the assumptions while embedding data structures for upscaling physical properties from the pore scale. As the research proceeds, oil and gas digital rock analysis are expected to provide a reliable platform to create better reservoir models that are able to more accurately analyze the reservoir and its properties.
• Natural gas produced in the world has increased by 3.4%, to 385.98 billion cubic feet, in 2019 from 373.22 billion cubic feet, in 2018. The increased utility of natural gas has ordained an increase in natural gas production to meet the world's consumption.
• Therefore, with the rise in demand for oil and gas, advancements in the technology and rising reliability of the system are expected to aid the market considerably during the forecast period.

North America to Dominate the Market

• North America region is the largest oil and gas digital rock analysis market and is expected to continue its dominance in the coming years. The region consists of major oil and gas oil production basins in the world, which provide fertile ground for further growth in the industry.
• The United States is the largest user of the oil and gas digital rock analysis in the region, especially with the boom in shale oil and gas in many of the onshore basins like the Permian basin that have contributed to the advancement in the digital rock analysis market. Shale oil and gas have steadily increased in the country, and market players are looking for better ways to extract from the reservoirs in the shale basins. Oil and gas digital rock analysis may provide for that requirement in the forecast period.
• The shale gas boom is expected to further provide growth in the oil and gas industry, which is expected to increase the growth in the oil and gas digital rock analysis market. In the 2018-2019 period, in the United States, shale gas increased by 15.76%, which is expected to positively aid the oil and gas digital rock analysis market.
• In 2018, the United States Interior Department allowed drilling in nearly all the United States waters, which is among the biggest expansions of offshore oil and gas leasing by the federal government in the history of the United States. This new development is expected to drive offshore exploration and production activity, and hence, the demand for digital rock analysis is likely to increase in the future.
• North America increased its output of crude oil increased significantly to 1027.1, in 2018 from 918.7, in 2017. Whereas, the region's gas production increased from 826.8, in 2017 to 906.2, in 2018. Increasing production is expected to create demand for better oil and gas digital rock techniques.
• Hence, the North America region is expected to dominate the market due to its vast crude oil and natural gas upstream sector, rising exploration in the offshore industry, and increasing demand for fossil fuel.

Competitive Landscape

The oil and gas digital rock analysis market is partially fragmented. Some of the key players in this market are Schlumberger Limited, Halliburton Company, Baker Hughes Company, Weatherford International PLC, CGG SA.

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