How ‘Well’ Positioned Is The Coiled Tubing Market?

Coiled tubing has a multitude of uses in the oil and gas industries, with it being particularly cost- and time-efficient. How does the market currently look, and how have the market players kept pace with the advancements?

Coiled tubing is a term that is used frequently in the oil and gas industry, but will definitely sound unfamiliar to common folks. So, what exactly is it? Simply put, it is an electrically welded tube, which is manufactured with one longitudinal seam. The seam is formed by high-frequency induction welding without the addition of filler metal. It is a long pipe spooled on a large reel, and is 1 to 3.25 inch in diameter.

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The modern day concept of the technology was developed in the early 1950s under the U.S. patent 2,567,009, named “Equipment for Inserting Small Flexible Tubing into High Pressure Wells”. It is a cost- and time-effective solution in the process of well intervention, and with well intervention being very critical to ensure optimal functioning of the producing well, coiled tubing assumes huge importance.

Assuming greater importance

Coiled tubing can be applied in both onshore and offshore oil & gas fields. The technique is gaining popularity as it is helpful for extending life of a producing well by providing well cleaning and completion facilities in the well. These services are included under well intervention service. Coiled tubing services can be used for deployment in wells while continuously circulating fluids. Another advantage of CT is, it has ability to work with current surface pressure present (no need to stop the well production), minimal formation damage when operation is performed, and it also reduces the service time & increase personnel safety.

With the growing demand for coiled tubing usage in upstream oil & gas industry, companies are also engaging themselves for developing intelligent coiled tubing (ICT), which combine real-time downhole data monitoring and power. The use of these systems improves operational efficiency significantly while accelerating well recovery. Some of the advantages are:

• well stimulation,
• milling & cutting,
• gas lift,
• perforating & abrasive jetting, and
• cleanouts.

Baker Hughes came out with their Intelligent CT system in 2016, which offers accurate and real-time downhole monitoring of high-resolution depth correlation, differential pressure, and temperature data, in order that the field crews can instantly react to changing conditions, and eliminate missed or wasted runs.

The cost and time-efficiency of Intelligent CT systems can be illustrated by the examples of Norway and Brazil, where the well located off the coast of Norway saw a significant decline in production, owing to hard barium sulfate accumulation. The intelligent milling and cleanout service in this case improved mill life and efficiency, minimized the number of runs, and saved much time and cost, to the tune of USD 755,000, when compared to a conventional cleanout. In the case of Brazil, the mature offshore well operation using the ICT system resulted in 83 hours being saved, as compared to traditional operations.

Growth Factors and Challenges

There are a number of factors aiding the growth of coiled tubing market, especially the Intelligent CT services. Prominent among them are:

• Decline in the production of oil, along with a simultaneous increase in the number of production and exploration activities around the globe is expected to drive market growth.
• Growing demand for well intervention and drilling services in oil and gas industries is expected to aid market growth.
• Countries engaged in exploration and production activities are witnessing Government support in the form of regulations, such as 30 CFR 250.616 and DRAFT IRP 21 (2016), providing a springboard for intensifying the activities.
• Critical economies such as China and the U.S. have taken initiatives such as relaxing FDI provisions, providing tax incentives and financial aids, which is anticipated to steer the coiled tubing market towards positive growth.
• Rise in shale gas projects as well as unconventional resource developments is expected to be a significant market driver in the coming years.

Oil recovery techniques are seeing promising growth owing to regeneration of matured oil wells, as well as rising operating costs concerning oil extraction from existing wells.