Up and Away: Directional Drilling Services Procurement Category Market Research Report from IBISWorld has Been Updated
Los Angeles, CA (PRWEB) January 26, 2015 -- Directional drilling services have a buyer power score of 2.5 out of 5, indicative of a market with relatively low buyer power. On one hand, a low level of vendor financial risk, which results in a negligible risk of supplier bankruptcy, favors buyer power, says IBISWorld research analyst Agiimaa Kruchkin. However, “a limited availability of substitutes, a significant level of specialization and high recent price volatility limit buyer negotiation power.”
Demand for directional drilling services has been robust due to the benefits of these services. Namely, directional drilling allows buyers greater access to resources scattered throughout the well bore. Furthermore, this method has improved drilling efficiency, which also reduces costs. “By comparison, in-house directional drilling is an expensive alternative and vertical drilling is limited in its capacity to reach reservoirs,” says Kruchkin, “thereby maintaining demand for directional drilling and aiding buyer power.” Significant price volatility has also challenged buyers during the period. Sudden swings in service prices undermine buyers' ability to accurately budget for services. As a result, buyers can bundle services for greater cost savings.
In the three years to 2014, service rates for directional drilling have trended upward, hampering buyer power. External demand drivers like industrial production index and the value of construction have facilitated this growth to the benefit of suppliers. At the same time, tepid annualized growth in the oil and natural gas price index has offset the increase in service prices to an extent. Furthermore, because a large number of small and medium-size vendors characterize this market, price-based competition is prominent and provides some relief to buyers. Current suppliers include Baker Hughes Inc., Halliburton Company, Schlumberger Ltd. and Weatherford International Ltd. For more information, visit IBISWorld’s Directional Drilling Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of directional drilling services. Directional drilling involves drilling at an angle to take measurements, hit targets and stimulate reservoirs. These evaluation services aid in reservoir engineering, well placement and mining resource mapping. Directional drilling services benefit buyers because they reach targets that cannot be reached otherwise, while improving well productivity in a fractured reservoir and minimizing the well's environmental impact. This report does not cover oil well fishing services or horizontal drilling services.
Executive Summary
Pricing Environment
Price Fundamentals
Benchmark Price
Pricing Model
Price Drivers
Recent Price Trend
Price Forecast
Product Characteristics
Product Life Cycle
Total Cost of Ownership
Product Specialization
Substitute Goods
Regulation
Quality Control
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Imports
Competitive Environment
Market Share Concentration
Market Profitability
Switching Costs
Purchasing Process
Buying Basics
Buying Lead Time
Selection Process
Key RFP Elements
Negotiation Questions
Buyer Power Factors
Key Statistics
About IBISWorld Inc.
IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
Gavin Smith, IBISWorld Inc., +1 (310) 866-5042, [email protected]
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