Nigeria has been classified as a major crude exploration hub in Africa, driving the global offshore drilling riser market estimated to reach $4.1 billion by 2023 and $4.9 billion by 2033.
The biggest deepwater reserves of crude oil remain in Nigeria, which is first among the ten nations. The bulk of reserves are located offshore in the Gulf of Guinea, the Bight of Benin and the Bight of Bonny as well as in the Niger River Delta throughout the nation.
Two main drivers in this market are responsible for accelerating its growth in the past few years.
The increasing number of offshore projects along with the rising production of shale gas globally will garner the requirement for offshore drilling risers.
At the same, the extraction of crude oil has driven extensive investments in offshore production and exploration activities globally.
A significant surge in the investments for multiple offshore projects has been prominent for the last five years and hence propelling the global demand for offshore drilling risers.
The Middle East and Africa are thought to be the most lucrative region for this market as large offshore oil and gas deposits are present in several Middle Eastern and African nations, says Oil Review Africa.
The South Pars Gas Complex present in the Persian Gulf, which is the biggest gas field in the world, as well as recent developments of oil and gas deposits in the eastern Mediterranean Sea are anticipated to support the market's expansion.
For instance, Shell Plc, stated in January 2022 that a large oil and gas discovery had been made in a Namibian offshore well.
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Resources estimated to be worth 250-300 million barrels of oil and gas equivalent have been discovered since the Graff-1 well drilling began in December 2021. The region, which has been essentially inert for the past 25 years, is anticipated to see a big increase in foreign investment as a result of the Graff-1.
Although little onshore exploration is taking place, the current emphasis of exploration efforts is mostly on the deep as well as ultra-deep offshore. Therefore, it is anticipated that the number of offshore drilling risers in the region would increase throughout the projection period due to upcoming offshore E&P operations, particularly from the West African region.
Recovering crude oil prices have been driving investments in offshore exploration and production (E&P) activities around the world. A significant uptick in the number of final investment decisions for a number of offshore projects has been prominent over the past couple of years, which has been driving the contracts for offshore drilling risers.
Emergence of integrated service providers, who provide both design engineering and installation services has been a prominent trend, as they help reduce the overall cost of the project to E&P operators.
Unstable crude oil prices and widening supply-demand gap are anticipated to hamper the growth prospects of the offshore drilling riser market in the foreseeable future.
Also, the growing number of offshore discoveries in Nigeria, Iran, South Africa, Egypt, Guyana, and Mozambique are expected to create significant growth opportunities for offshore drilling riser manufacturers in the Middle East & Africa region.
