The Global OCTG (Oil Country Tubular Goods) Market Report: 2014 Edition by Koncept Analytics. For more mail: vikas@konceptanalytics.com

1. Global OCTG (Oil Country Tubular Goods) Market
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2014
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2. Executive Summary
Oil country tubular goods (OCTG) are hollow steel products of circular cross-section used in the oil and gas industry for exploration and
production activities. OCTG encompasses mainly three types of products which include drill pipe, casing, and tubing. OCTG can be
produced as seamless or welded tubes and pipes. The OCTG manufacturers can generally either produce seamless or welded OCTG
products and not both, as the capital investment to manufacture seamless OCTG is ten to twenty times higher than the investment
required to manufacture welded OCTG. At the same time, API specifications for most grades of casing and tubing stipulate that either
welded or seamless construction is acceptable for end-use applications. Generally, welded pipe producers entering the OCTG market
concentrate on producing line pipe and in some cases, some low grades of API casing.
The key factors which are anticipated to drive OCTG market include rising global demand for oil and gas, growth in crude oil prices,
economic growth and lack of alternative sources of energy. Some of the noteworthy developments of this industry include global rig
count growth, increasing global E&P spending, and seamless pipe industry, among others. However, the growth of respective industry
is hindered by the barrier for fluctuation in steel prices, barriers to entry, global oil and natural gas depletion and impact on
environment.
This report offers a comprehensive analysis of the global OCTG market. Furthermore, market dynamics such as key trends and
development; and challenges are analyzed in depth. On the contention front, the global OCTG market is reined by few major players
namely, Tenaris S.A., Vallourec, OAO TMK and Nippon Steel and Sumitomo Metal Corporation. The competitive landscape of the
respective market, along with the company profiles of the leading players are also discussed in detail.
By combining SPSS Inc.’s data integration and analysis capabilities with our relevant findings, we have predicted the future growth of
the market. We employed various significant variables that have an impact on this industry and created regression models with SPSS
Base to determine the future direction of the industry. Before deploying the regression model, the relationship between several
independent or predictor variables and the dependent variable was analyzed using standard SPSS output, including charts, tables and
tests.
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3. Oil country tubular goods (OCTG) are hollow steel products of circular cross-section used in the oil and
gas industry for exploration and production activities..
•The demand of premium OCTG is chiefly driven by shallow water
which accounts for …% of the overall premium OCTG consumption
as of 2013, followed by deep water extraction with …% share.
•The active rig count acts as an important indicator of demand for
OCTG market. The latest industry statistics suggest that the
worldwide rig count increased by around …% to reach … in 2013
from … in 2012. Globally, the rig count increased at a CAGR of
…% during 2002-2008, but the global economic slowdown reduced
the drilling activity in 2009. However, industry experts believe that
the global rig count will grow once again due to aggressive drilling
activities to capitalize on the presently favorable economies.
•. Shale is a fine grained sedimentary rock which is composed of
mud. Shale is divided into three types: API, Semi-Premium and
Premium. API accounted for the largest share with …%. The semi-
premium and premium accounted for …% and …% share
respectively.
Global Composition of Shales by Type (2013)Global Rig Count (2009-2013)
Premium OCTG Consumption by Application (2013)
2009 2010 2011 2012 2013
Units
API Semi-Premium Premium
Shallow Water Deep Water Shales Oil Shales Gas Others Oil Others Gas

4. Some of the noteworthy developments of this industry include rising global demand for oil and gas, rising
crude oil prices, increasing global E&P spending and economic growth among others.
•Sustained high oil prices and sanctioning of major projects are
driving the global exploration and production spending. This growth
has been witnessed worldwide, as almost every country with
hydrocarbons to exploit is experiencing growth in E&P. E&P
spending was recorded to be US$... billion in 2013 which is
expected to reach US$... billion in 2014.
•During 2013, the US accounted for the largest share in drilling
activity and accounted for …..% share. It was followed by Canada
and Russia with …% and …% share, respectively.
•North America is the single largest OCTG market in the world and
its growth is determined by the fact that it offers an ideal mix of
both onshore and offshore oil and gas reserves and safe political
and legal environment with mineral rights privately owned. The
OCTG market showed a strong recovery after the recession of
2009. As of now, North America accounts for …% of the worldwide
recorded active rigs.
Active Rigs Count (2013)Global Drilling Activity by Geography (2013)
Global E&P Capital Spending Growth (2010-2014E)
2010 2011 2012 2013 2014E
US$Billion
The US International Canada
The US Canada Russia South America
Middle East Far East Africa Europe

5. The rising global demand for oil and gas plays a significant role in growth of the global OCTG market.
•In 2013, the global oil demand reached nearly … million barrels per
day over … million barrels per day in 2012. The same is expected to
reach … million barrels per day at the end of 2014, respectively.
•Given the current underutilization of US mills and growing demand for
OCTG in the region, the US OCTG production capacity is expected to
record a growth of …% in the next five years to reach … million tons by
2015 from … million tons in 2011.
•The use of horizontal drilling and hydraulic fracturing to exploit shale
plays a pivotal role in the energy landscape in the US. Shale drilling has
been continuously growing in the region due to which the use of
horizontal and directional drilling has expanded to …% and …%,
respectively. The development of shale drilling requires more tons of oil
country tubular goods per well drilled; which is certain to translate in the
growth of the OCTG market..
Breakdown of US Rig Count by Nature of Drilling Operations (2013)The US OCTG Production Capacity (2011-2015E)
Global Oil Demand (2009-2014E)
2011 2012 2013 2014E 2015E
MillionTons
2009 2010 2011 2012 2013 2014E
MillionBarrelsPerDay
Horizontal Vertical Directional

6. The growth of respective industry is hindered by the barrier for fluctuations in the prices of steel.
The prices of crude oil have recorded a notable growth over the last few years mainly in response to the strong global demand, limited spare
oil production capacity and continuing political instability in certain oil producing regions. The crude oil prices increased from US$... per barrel in
2012 to US$... per barrel in 2013 showing a growth of approximately …%. This growth provides an incentive to oil and gas companies to
increase drilling operations and increase their investments in production and exploration activities. This, in turn, will add to the demand for
OCTG throughout the oil and gas industry.
The recent years have witnessed significant growth in the global OCTG market, and the same is projected to continue at a positive rate in the
years ahead. In 2013, the global demand for OCTG products was … million tons, which is expected to grow up to … million tons by 2017. This
demand is estimated to grow at a CAGR of …% during 2010-2017.
The demand for oil and gas is increasing at a significant rate due to industrialization, particularly in emerging markets as industrialization calls
for increased energy consumption to operate business and factories. Growing wealth of the residents of emerging markets, especially China
and India, is also reflecting in their spending pattern in which they are buying cars which again requires notable amount of energy to run. The
demand for oil has increased at a steady pace during the period of 2004 to 2007; however, it declined in 2008 and 2009 due to global economic
recession. In 2010, global demand for oil and gas again picked up and has been increasing since then primarily due to the economic
development of Asian and other major non-OECD nations.
Note: Market attractiveness is inverse of penetration. Low penetration means high attractiveness and vice-versa
2009
2010
2011
2012
2013
US$PerBarrel
Worldwide Crude Oil Prices (2009-2013)
2010
2011
2012
2013
2014E
2015E
2016E
2017E
MillionTons
Global OCTG Demand Forecast (2010-2017E)

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