The global onshore seismic market has had a devastating 2020 with a 27% slump in purchase value. Next year is set to be even more painful year as operators’ budget cuts will continue to strain the services sector, before a projected recovery in 2022, a Rystad Energy report shows. China will be a bright exemption to the trend as it will lead global purchases in the next two years, starting with a projected 12% demand boost already in 2021.

Global onshore seismic purchases are expected to fall to $3.9 billion in 2020 from almost $5.4 billion in 2019. Rystad Energy forecasts the overall decline to continue into 2021, with purchases sliding to $3.2 billion before they start a recovery to $3.7 billion in 2022 and further in following years.

Interest in onshore exploration picked up in 2019, as evident from the number of lease rounds that were held and the onshore acreage that was awarded. This year, though, onshore license awards through October have dropped by two-thirds to 106,000 square kilometers in acreage from 316,000 square kilometers during the same period last year. The largest onshore acreage awarded was in India, which amounted to 30,566 square kilometers. This was followed by Australia with 15,513 square kilometers and Oman with 10,000 square kilometers.

“Asia, North America and Russia will account for more than 70% of the onshore seismic purchases over the next two years. While Asia will begin its recovery in 2021, both North American and Russian purchases will continue to shrink,“ says Binny Bagga, senior energy service analyst at Rystad Energy.

Within Asia, China is expected to account for 80% of the total purchases over the next two years. China, as part of its 14th five-year economic development plan starting next year, is looking to boost its shale gas production by between 50 billion to 80 billion cubic meters per annum through 2025. Chinese onshore seismic demand is expected to grow by 12% in 2021, followed by 16% in 2022 as the country remains committed to increasing its domestic oil and gas production.

In fact, China will be the global leader in onshore seismic purchases in the next two years, with its market estimated to reach a cumulative $1.7 billion in value, followed by the United States with $1.6 billion and Russia with $1 billion in 2021–2022.

BGP, a subsidiary of China National Petroleum Corporation (CNPC) and the market leader in the global land seismic market, this year conducted multiple surveys both within and outside China. The company in April commenced a large 3D seismic acquisition survey in the Jintang-Santai area in the Sichuan basin in China. The survey is by far the largest 3D seismic survey in the Sichuan basin in 2020, covers up to 2,263 square kilometers, and will be of great significance to explore and develop large-scale natural gas reservoirs in southwest China.

BGP also concluded the world’s first large-scale 9C-3D seismic survey in the Qaidam basin in western China in August. In the wider Asian region, the company conducted a walk-away VSP survey for Pertamina in Indonesia. Also, Sinopec Oilfield Service Corporation, with its significant presence in China, actively undertook onshore oil and gas exploration in Shunbei, southeast Sichuan and other regions of China.

PetroChina, China’s biggest onshore operator, has continued with its optimized domestic exploration activity in 2020 and has made important discoveries and strategic breakthroughs in Tarim, Sichuan, Junggar, Erdos and other basins. Overall, we estimate the number of Chinese exploration wells to climb to 2,641 in 2021 from 2,187 this year.

Among other key regions, we expect activity in the United States, which accounts for a major share of North American purchases, to pick up in 2022, while it will take one more year for activity in Russia to get back on its feet.