Introduction to Coiled Tubing

The Business
The CT Business
The coiled tubing industry continues to be one of the fastest growing segments of the oilfield services sector, and for good reason. CT growth has been driven by attractive economics, continual advances in technology, and utilization of CT to perform an ever-growing list of field operations. Coiled tubing today is a global, multi billion dollar industry in the mainstream of energy extraction technology.

The potential advantages associated with CT are typically driven by the fact that a workover rig (and associated cost) is not required, the rapid CT trip speed in and out of the well, and that CT operations are designed to be performed with pressure on the well. Eliminating the requirement to kill the well can be a significant factor in the decision to utilize CT for a particular field operation, as it reduces the risk of formation damage.

Growth of the Service Fleet
In January 2004, slightly more than 1,050 CT units were estimated to be available on a worldwide basis. The total number of working CT units is up sharply from the roughly 850 units reported in February 2001. At present, the International market accounts for the bulk of the currently available CT fleet with more than 425 units. Canada and the U.S. are estimated to contribute an additional 239 and 253 units, respectively.

New CT Markets / Field Applications
CT first established it's niche in the marketplace as a cost-effective well cleanout tool. In recent years, these conventional wellbore cleanouts and acid stimulation jobs accounted for more than three quarters of total CT revenue. However, CT use has continued to expand as it is adopted for use in additional field operations. Most recently, CT fracturing and drilling applications have emerged as two of the fastest growth areas. Revenue from these two CT applications has grown from almost zero 10 years ago, to approximately 15 percent in more recent times.

CT Service Providers
The CT market is dominated by three large service companies, who control approximately 60% of the CT total marketplace. The market is also serviced by numerous smaller CT service providers. On a regional basis, there are typically more than 30 providers of CT in the International marketplace. Canada is serviced by more than 35 CT providers, and the U.S. by more than 25 companies.