Industry Analysis & Industry Trends
The Oil Drilling and Gas Extraction industry has recently entered a boom, which has largely been encouraged by technological improvements that have enabled the development of Alberta's oil sands. Increased production over the past five years has led to consistent revenue growth, though a sharp decline in the world price of crude oil caused revenue to contract in 2015. Still, the size of Canada's proven oil reserves trails only Saudi Arabia and Venezuela, and continued production of the oil sands and offshore resources will spur overall growth through 2021, despite weakening prices in the short term. Additionally, improvements in the US economy, the industry's largest international market, are expected to boost export revenue in the next five years... purchase to read more
Industry Report - Starting a New Business Chapter
There are substantial barriers to entry to the Oil Drilling and Gas Extraction industry. For example, this industry is associated with high risk. The nature of oil and gas exploration and development, as well as the volatile shocks in the prices of these commodities, creates a substantial amount of risk for industry growth. Additionally, the industry is highly capital intensive. It requires significant amounts of capital equipment, including offshore platforms and other extraction machinery to bring fields into production.
Finally, many of the major oil and gas producers are vertically integrated companies, with interests in downstream operations, such as petroleum refining and marketing. New entrants lacking such linkages may find it difficult to penetrate the market.
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