Asia-Pacific Oil Country Tubular Goods Industry

Asia-Pacific Oil Country Tubular Goods Market Analysis

The Asia-Pacific Oil Country Tubular Goods Market is expected to register a CAGR of greater than 2.7% during the forecast period.

• Premium grade OCTG is likely to witness significant demand over the forecast period as the requirement of premium grade OCTG products is higher in upstream operation.
• The liberalization of the oil and gas sector in the Asia-Pacific region is aimed to increase the foreign investments and thereby helping the oil and gas industry to grow, which, in turn, is likely to provide an opportunity for oil country tubular goods market.
• China is expected to dominate the market over the forecast period owing to its improved domestic oil and gas production, which, in turn, increases the demand for OCTG products.

Asia-Pacific Oil Country Tubular Goods Market Trends

Premium Grade OCTG to Witness Significant Demand

• The premium grade OCTG market is in the growing phase on account of increasing demand for the same from oil and gas upstream activities.Thepremium grade applications are widespread in gas wells, horizontal wells, highpressure (above 5,000 psi) and high temperature (above 250 F) wells.
• The exploration of natural gas is receiving huge impetus with surge indevelopment of shale reserves. Moreover, the horizontal directional drilling haspromulgated the production of natural gas from shale reserves, which, in turn,is a big boost for premium grade OCTG market.
• As per the government's five year's plan for natural gas (2016-2020) in China, theproportion of natural gas in the energy consumption mix is expected to rise about 10% by 2020, from about 5.9% in 2015, through domesticexploration & production activities.
• Amongst the years, India has been one of the fastest growing large economiesin the world. However, India remains largely dependent on oil imports to meet upwith its growing need for oil. Moreover, in a bid to promote energy security by reducing its over-dependenceon the oil imports, the Indian government has set itself an ambitious target ofreducing oil imports by 10% by 2022.
• Oil & Natural Gas Corporation (ONGC) and Oil India Limited (OIL) along withnumerous private players such as BP, Reliance, among others have announceda series of large investments projects, both offshore and onshore, which isexpected to increase the demand of OCTG products in India significantly.
• Despite its lack of domestic energy resources, South Korea is home to some ofthe biggest and most advanced oil refineries in the world. In a bid to improve thenation's energy security, the national oil and natural gas companies are activelyseeking overseas exploration and production opportunities.
• Therefore, as the market for OCTG is directly dependent on oil & gas activities in Asia-Pacific region, which, in turn, is expected to register high demand for premium gradeOCTG. Furthermore, countries such as Japan has a well-established OCGTindustry, with export capabilities to other regions as well.

China to Dominate the Market

• China's newly adopted 13th Five-Year plan for the years 2016 to 2020 underscore China's commitment to deeper reforms in several critical sectors, including oil and gas (O&G).
• Boosted by government's support in 13th Five-Year plan, numerous international service companies and International Oil Companies (IOCs) have increased their presence in China mostly through partnering with Chinese companies. The offshore oil projects have attracted significant investments from IOCs and China National Offshore Oil Corporation (CNOOC), the largest offshore oil & gas producer in China.
• The offshore rig count in China reached 25 in March 2018. Increased offshore drilling has resulted in the increase of complexity and the lateral lengths of the wells drilled in China, which is expected to further supplement the demand for premium grade OCTG in the country.
• China holds a well-established network of OCTG manufacturing companies. Chinese domestic equipment manufacturers are expected to hold approximately 85% of the domestic oilfield services market. China benefitted a major share from the export of Oil Country Tubular Goods (OCTG) products when the United States was witnessing a shale production boom.
• Therefore, on a long-term forecast, with expected improving domestic oil & gas production, the demand for OCTG products is expected to increase, with a significant share coming from rising number of offshore oil & gas projects in China.

Asia-Pacific Oil Country Tubular Goods Industry Overview

The Asia-Pacific oil country tubular goods market is fragmented. Some of the key players include National-Oilwell Varco, Inc., ILJIN STEEL CO., Nippon Steel Corp, Inc., Tenaris SA, and TPCO Enterprise, Inc.

Asia-Pacific Oil Country Tubular Goods Market Leaders