Oil and Mineral Exploration Drilling in Australia Industry Market Research Report Now Available from IBISWorld

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Oil and mineral exploration drillers are expected to face a number of structural challenges as the mining boom slows. For this reason, industry research firm IBISWorld has added a report on the Oil and Mineral Exploration Drilling in Australia to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

With the mining boom slowing, exploration drillers face an uncertain future.

In the five years through 2012-13, the Oil and Mineral Exploration Drilling industry has followed a volatile growth path. The industry provides services for mining companies engaged in greenfield oil and mineral exploration. This is the riskiest area of the Mining division, where companies are engaged in looking for new and economically viable deposits of resources. According to IBISWorld industry analyst Caroline Finch, “expenditure on greenfield exploration fluctuates significantly year on year in line with small miners' ability to access capital. When commodity prices fall, or sentiment around the Mining division declines, demand for greenfield exploration services can dry up suddenly”. In 2008-09 and 2012-13, drops in demand have resulted in contractions in industry revenue.

In the past 10 years, the Oil and Mineral Exploration Drilling industry has benefited from a prolonged boom in capital expenditure in the Mining division. The first phase of the boom took the form of increasing commodity prices as growth accelerated in developing countries such as China and India. Mining companies ramped up greenfield exploration spending in absolute terms to develop new projects to meet demand for commodities. The influx of funding for exploration was highlighted in 2007-08, when industry revenue shot up by 90.6%. The height of expenditure on industry services was in 2010-11, when revenue peaked. Over the five years through 2012-13, the industry has declined at a compound annual rate of 4.9%. This decline is expected to continue in 2012-13, with industry revenue forecast to decrease 21.2% to $697.2 million.

The outlook for the next five years is downbeat. “A number of structural challenges are expected to become more pressing as the boom in investment in the Mining division winds down,” says Finch. Over the past 10 years, the rate of new resource discoveries in Australia has slowed. If the pipeline of new projects continues to decline, the industry's scope will be limited. Over the next five years, industry services are likely to be employed in the assessment of the economic viability of known greenfield locations rather than in the search for new locations. Industry participation is forecast to contract due to these pressures.

In 2012-13, industry concentration is at a low to medium level. The industry’s four largest players Boart Longyear Limited, Ausdrill Limited, Layne Christensen Australia Pty Ltd and Barholdco Pty Limited.

For more information, visit IBISWorld’s Oil and Mineral Exploration Drilling report in Australia industry page.

Follow IBISWorld on Twitter: http://twitter.com/#!/ibisworldau

IBISWorld Industry Report Key Topics

This industry includes firms primarily engaged in test drilling, boring and core sampling for exploratory purposes in mining, oil and gas operations. Exploration drilling companies are contracted by mining companies to carry out exploratory drilling for greenfield (new) projects. However, many companies also supply drilling services for brownfield (established) projects, which is beyond the scope of this report.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.

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