Industry Insights
The global enhanced oil recovery (EOR) market size was estimated to be worth USD 29.71 billion in 2016 and is likely to grow significantly over the projected period. The rising oil requirement and reducing oil production has resulted in the development of new technologies to extract oil from the reserves such as EOR.
Global enhanced oil recovery market revenue, by technology, 2014 - 2025 (USD Billion)
EOR helps to increase the oil production from matured and aged wells. As the crude oil demand is rising exponentially, this method is contributing to overcome the gap between output and demand. Globally, the average recovery factor of oil is around 35%. With the help of EOR, oil production has increased, reaching around 70% to 73%. This technique extracts 60% to 90% of the oil from the reservoir, which is remaining even after standard production method (primary & secondary).
Companies present in the market are investing heavily in the research and development of new technologies including ultrasonic, and plasma pulse technology (PPT) to enhance oil recovery. Many companies are also developing Carbon Capturing and Storage (CCS) technique to improve oil recovery.
Segmentation By Technology
• Gas injection
• Thermal
• Chemical
• Others
Gas injection accounted for 26% of the total market share in 2016 and is expected to grow substantially over the projected period. Its various advantages over other methods including an increase in pressure in the reservoir resulting in more oil production are expected to lead to its growth. Moreover, the injected gas mixes with the oil making it soluble, due to which the oil viscosity decreases.
Carbon dioxide, nitrogen, and natural gas are the most common gas used for the method. The method is most popular in U.S. and Canada. CO2 EOR contributes about 6% of U.S total crude oil production.
Thermal EOR market was valued at USD 12.6 billion in 2016 and was the most widely used technology for oil extraction. Technologies such steam flooding, cyclic steam injection and combustion widely used in extracting oil mature wells. In 2011, solar thermal EOR techniques were introduced in Oman and California. This method is similar to the thermal technique which uses solar energy to heat the steam.
Segmentation By Application
• Onshore
• Offshore
The onshore segment accounted for 72.2% in 2016 and is expected to witness steady growth over the projected period. With depleting onshore reserves, offshore reserves are expected play greater role in securing growing demand. Furthermore, technological development has helped oil companies to increase the depth of offshore oil field which in turn is expected to boost the market.
Depleting extraction rates and increasing hydrocarbon production cost in conventional onshore oil wells are resulting in increasing offshore exploration activities. The offshore segment is expected to grow at a volume CAGR of 7.2% over the next nine years.
Segmentation by Region
• North America
• U.S.
• Canada
• Mexico
• Europe
• Germany
• UK
• Russia
• Asia Pacific
• China
• Japan
• Australia
• Middle East & Africa
• Saudi Arabia
• Central & South America
North America accounted for 42.4% of the global volume share in 2016. The regional market witnessed a surge in crude oil production by an average growth of over 10% and natural gas production by over 5% from 2013 to 2014. The regional market is expected to witness stagnant growth over the next nine years on account of slump in crude oil prices in the recent past particularly from the second quarter of 2014 to 2015.
Large and global E&P companies are concentrating their activities in China, South Korea, and India. Increasing government initiatives to exploit oil reserves by providing financial aid which includes tax benefits particularly in China and India is expected to drive market penetration in these regions over the next few years. The Asia Pacific EOR market is anticipated to grow at a revenue CAGR of 8.4% over the projected period.
Competitive Insights
The EOR industry is characterized by the presence of giant, multinational and experienced players. These companies procure raw materials such as polymers, nitrogen, and carbon dioxide from regional suppliers. The technology used in the EOR is mostly done in-house by the companies.
Some of the major players in enhanced oil recovery market are China Petroleum & Chemical Corporation, BP plc., ExxonMobil Corporation, Chevron Phillips Chemical Company LP., Royal Dutch Shell plc, Lukoil Oil Company, Praxair, Inc., Chevron Corporation, Cenovus Energy Inc, Petroleo Brasileiro S.A.
