New Oil Discoveries And Oil Country Tubular Goods Demand In Africa

1 min read

The world’s growing population, and rapid industrialization are fuelling a proportional increase in the global oil and gas demand. This demand has led to an increase in oil explorations and production around the world. Oil country tubular goods are a vital part of both oil exploration and production. Oil country tubular goods, or OCTG in short, refers to pipelines and other tubular products such as drill pipes, tubing and pipe casings that the petroleum industry uses.

With oil beginning to be used as a political weapon these days, many of the world’s developed and developing economies are trying to achieve oil independence. This has resulted in oil production and exploration not being limited to just a few traditional players anymore. There is also the problem of many of the old wells starting to dry out, in addition to the added concern of environmental safety on the older wells. Both oil companies and governments are therefore pushing for oil exploration into new regions around the world. Advances in drilling and extraction technology has led to an increase in the use of horizontal drilling and fracking for oil and gas exploration and extraction.

Oil country tubular goods can be of welded or seamless construction. Seamless tubes are used when the drilling and production encounters high pressure and hostile environments. Welded pipes are used when high strength is not required. The manufacturing costs of seamless tubes are currently much higher than that of welded ones. Corrosion is another major factor affecting OCTG. Selection of proper material for OCTG for each kind of environment is important in regulating the overall cost of the drilling and production processes as well as ensuring integrity of the well.

Although factors like high initial investment and lack of skilled labour have always been hindrances to the development of all branches of the oil and gas industry, the push of increasing energy demand is making oil and gas exploration and production more and more attractive to investment. The intense competition among petroleum producers is also serving as an impetus to increasing drilling activity around the world. The current trend of the petroleum industry is pushing up the demand for OCTG worldwide.

The petroleum industry in Africa has always been hindered by regional conflicts, theft, corruption and lack of skilled labour. In spite of this, the oil and gas industry is on a positive surge in Africa, especially in the wake of new oil discoveries along the eastern coast. The regional oil consumption in Africa is also increasing in view of a rising populations and urbanization. As African countries seek to increase their oil production, they are also driving the demand for petroleum exploration and production equipment like OCTG.

Mordor Intelligence

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