Shale gas equipment ushered in "Golden Decade"

Under the guidance of the “Shale Gas Revolution” in the United States, China’s shale gas industry has begun to take off and will witness explosive growth during the “13th Five-Year Plan” period. Correspondingly, shale gas equipment is expected to usher in the “Golden Decade”, in which core equipment companies such as fracturing and logging and companies directly involved in development benefit the most. The US “shale gas revolution” has a huge impact, and China is catching up. (1) Natural gas is increasingly important in China’s energy consumption structure. In the future, natural gas is demanding as a clean and environmentally friendly energy and chemical raw material, in an environment where energy conservation and environmental protection are increasingly demanding. Future applications will see substantial growth. According to the IEA (International Energy Agency) forecast, natural gas will surpass coal as the world's second largest energy source in the future. At present, natural gas accounts for about 24% of the world's primary energy consumption, while China only accounts for about 4%, and there is huge room for growth in the future. From 2000 to 2010, China's natural gas consumption grew at an average annual rate of 16.4%, 9 percentage points faster than oil consumption, and 8 percentage points faster than coal consumption. In 2011, the apparent consumption of natural gas in China reached nearly 130 billion cubic meters, a year-on-year increase of 20.9%. Considering the increase in demand for natural gas consumption in China's urban gas (including residential, commercial and natural gas vehicles), power generation, industrial fuels, and chemicals, we believe China's natural gas consumption is expected to average annually during the 12th Five-Year Plan period. It is about 20% growth. (2) The US “Shale Gas Revolution” changes the world energy pattern, and China accelerates the development process. The development of shale gas is considered to be “an energy revolution”. The successful development of shale gas in the United States has prompted some countries to accelerate the development of the natural gas industry. The advent of "hydraulic fracturing" technology has made large-scale exploitation of shale gas possible. The global natural gas resources to be discovered have grown rapidly. The global shale gas resource evaluation results are optimistic. The shale gas resources have increased global natural gas resources by 40%. . The global unconventional natural gas resources are huge, about 1.65 times the amount of conventional oil and natural gas resources. At present, shale gas accounts for the largest proportion of shale gas, coalbed methane and tight gas reserves that have been commercially mined, accounting for about 49%. The successful exploitation of shale gas in the United States has set off a passion for global shale gas research and exploration. From the domestic point of view, the supply and demand gap of natural gas will continue to expand, China's shale gas resources recoverable reserves are at the global leading level, and natural gas as a highly efficient clean energy accounted for a proportion of domestic primary energy consumption is significantly lower than the global average. Shale gas mining has great advantages. In March 2012, China’s “Shale Gas Development Plan (2011-2015)” has established a preliminary understanding of the national shale gas resources and their distribution, preferably 30 to 50 shale gas prospects and 50-80 It is advantageous to target areas, to find shale gas geological reserves of 600 billion cubic meters, recoverable reserves of 200 billion cubic meters, and 2015 shale gas production of 6.5 billion cubic meters. At the same time, the plan also made a prospect for the development of shale gas in 2020: during the “13th Five-Year Plan” period, further increase investment and significantly increase the reserves and production scale of 19 exploration and development zones. At the same time, vigorously promote the exploration and development of the two lakes, Jiangsu, Zhejiang, Ordos , South China North, Songliao, Junggar, Tuha, Tarim, Bohai Bay, and build a new shale gas exploration and development zone. Strive to achieve 600-100 billion cubic meters of output in 2020. By the end of 2011, China's oil companies had carried out 15 shale gas straight well fracturing test gas, 9 gas, and initially mastered the shale gas straight well fracturing technology, which confirmed the prospect of shale gas development in China. Drill two shale gas horizontal wells 201-H1 and build HF-1 wells. At present, through the first round and the second round of bidding for shale gas, China's shale gas development mechanism is gradually improving. The State Council approved the release of shale gas as an independent mineral and the "Shale Gas Development Plan (2011-2015)". The enthusiastic participation of many enterprises and local governments has made China's shale gas development embark on a rapid development track. In the future, China's shale gas bidding mechanism will gradually mature, shale gas mining tax and fee reduction and financial subsidy policies are expected to be introduced, and natural gas price marketization mechanism reform is expected to be realized, and will become an important catalyst for promoting the development of shale gas industry. (3) The shale gas equipment is expected to usher in the "Golden Decade", and the core equipment enterprises will benefit the most. We believe that the development of the domestic shale gas industry in the "Twelfth Five-Year Plan" period will still be in its infancy, and it is expected to welcome during the "13th Five-Year Plan" period. Explosive growth. Shale gas equipment is expected to usher in the “Golden Decade”, in which nuclear equipment companies such as fracturing, logging and perforating, and related equipment companies directly involved in shale gas exploration and development have benefited the most. We are optimistic about Jerry shares, Hui Bopp, Ji Yi science and technology, the source of oil, LandOcean and other core competitiveness of the industry segment leader. Among the five companies, Jerry is the leader in fracturing and cementing equipment; Huibopu is involved in shale gas bidding, and may enter the shale gas downstream industry on the basis of oil and gas separation equipment and other related equipment business; Jiai Technology has a unique position in the field of high-end imaging logging equipment; Tongyuan Petroleum has core competitiveness in the field of compound perforating equipment and oil and gas field production technology services; Hengtai Epp's exploration equipment and services will be in the shale gas development process It will benefit first, and will expand and strengthen its unconventional oil and gas resources and technical services such as shale gas and coalbed methane through the acquisition of integrated oil and gas equipment business such as logging trucks. Overall demand for shale gas equipment: 200 billion in 2012-2020 (I) Overall demand analysis: The average annual demand for shale gas equipment before 2020 is about 22.2 billion yuan. We believe that China's shale gas will be from 9 to 2012 years. It is necessary to drill about 40,000 wells, with a total investment of 800 billion yuan, with an average annual investment of 88.9 billion yuan; of which equipment accounts for 25%, total equipment demand is about 200 billion yuan, and the average annual demand is about 22.2 billion yuan. We assume that shale gas production will reach 60 billion cubic meters by 2020. According to the "Shale Gas Development Plan (2011-2015)", the shale gas production in 2015 will be 6.5 billion cubic meters, and the output in 2020 will reach 600-100 billion cubic meters. At present, most of the domestic and international plans for 2015 are agreed, but the goals for 2020 are controversial. Among them, WoodMackenzie, a world-renowned energy consulting company, believes that China can only achieve a maximum of 30 billion cubic meters of shale gas production in 2020; Tong Xiaoguang, an academician of the Chinese Academy of Engineering, believes that the goal of producing 80 billion shale gas per year in 2020 is likely Too high. We are cautious, assuming that we can achieve the planned lower value target of 60 billion cubic meters. We assume that China's single well production in 2015 and 2020 will be 2 million cubic meters and 1.5 million cubic meters respectively. (1) PetroChina's single-well production level in the shale gas wells in southern Sichuan Province has an average daily output of 10,000 cubic meters, which can be calculated at 3.65 million cubic meters per year; (2) Chongqing proposes to fight 150-200 shale by 2015. Gas wells, the annual output of shale gas reaches 1.3 billion to 1,500 million cubic meters, so that the single well output is calculated to be 8 million cubic meters. (3) However, according to US data: In 2006, the US shale gas production was 28.3 billion cubic meters, the number of wells was 39,500, and the single well production was 720,000 cubic meters. (4) We believe that the data of PetroChina is a well-expanded and well-drilled well, and it also needs to take into account the unventilated drilling and the attenuation of the gas output over time. We believe that the single-well production data in the United States is more relevant. Considering the differences in the geological structure between China and the United States, we assume that China's single well production in 2015 and 2020 will be 2 million cubic meters and 1.5 million cubic meters respectively. . Referring to the current cost of Sichuan shale gas development and Shell's cost plan, we assume that the single well investment in 2015 and 2020 will be around 25 million yuan and 30 million yuan respectively. We estimate that from the period of 2012-2020, China's total investment in shale gas will be around 800 billion yuan, with an average annual investment of 88.9 billion yuan; of which equipment accounts for 25%, total equipment demand is around 200 billion yuan, and the average annual demand is at About 22.2 billion yuan. We roughly decompose the total equipment demand of about 200 billion yuan. It is estimated that the demand for domestic shale gas equipment in 2020 is expected to be close to 60 billion yuan. Given the small base, China's shale gas equipment demand will grow at an average annual rate of around 50% in the next nine years. Since the demand base of shale gas equipment in 2012 is difficult to determine, the annual average demand growth rate of the industry is highly biased. When we assume that the demand for shale gas equipment in 2012 is 1 billion yuan, the average annual growth rate of the industry in 2012-2020 is 58%; when we assume that the demand for shale gas equipment in 2012 is 2 billion yuan, the industry in 2012-2020 The average annual growth rate is 46%; when we assume that the demand for shale gas equipment in 2012 is 3 billion yuan, the average annual growth rate of the industry in 2012-2020 is 39%. (2) The demand for oil and gas equipment far exceeds shale gas. The average annual demand for more than 250 billion yuan before 2020. We only considered the shale gas equipment part; due to the close integration of shale gas equipment and services, and shale gas equipment service and coal seam Unconventional natural gas such as gas and tight gas and conventional oil and gas exploitation are inseparable, and some enterprises are engaged in domestic and foreign markets at the same time. Therefore, the oil and gas equipment market is actually much larger than the shale gas equipment market. According to the world's leading energy agency Spears & Associates, the global oil and gas equipment and services market is about 300 billion US dollars, of which the onshore oil and gas equipment and services market accounts for about 70%. We use the total industrial output value data of China's oil drilling and mining equipment manufacturing industry to roughly judge the market size of domestic oil and gas equipment. According to the statistics of China Machinery Industry Federation, the total industrial output value of China's oil drilling and special equipment manufacturing industry in 2011 reached 183.4 billion yuan, a year-on-year increase of 33%. From January to July 2012, the total industrial output value of China's oil drilling equipment manufacturing industry increased by 22% year-on-year, of which the output value in July increased by 31%. We believe that the market demand for China's oil drilling and special equipment in 2012 is more than 200 billion yuan. If we conservatively assume that the market demand will remain around 6% (refer to GDP growth) by 2012, the annual average market demand for China's oil drilling and special equipment will exceed 250 billion yuan by 2020, and the oil and gas equipment market demand in 2020. Nearly 320 billion yuan. According to our analysis, the annual market demand for shale gas equipment is close to 1/10 of the total oil and gas equipment market by 2020, but in 2020, the demand for shale gas equipment market may be close to 1/5 of the total oil and gas equipment market. (III) Shale gas development industry chain: horizontal wells and fracturing are the most critical technical links Shale gas development includes exploration, development and production. Among them, the development and production links need to apply drilling equipment, logging equipment, cementing equipment, logging equipment, perforating equipment, pressure equipment, oil and gas water separation equipment and many other equipment. In the current shale gas mining process, horizontal wells and clean water fracturing are the most critical technologies for shale gas development. Shale gas equipment segmentation: focus on fracturing, logging and other aspects (1) Fracturing equipment: accounting for about 20% of equipment investment Fracturing operations play an important role in tapping the production potential of oil wells and maintaining stable production of oil fields. effect. The fracturing process is applied extensively in the oil and gas extraction process. The fracturing operation uses a fracturing truck (skid) group to inject a liquid (fracturing fluid) carrying chemical additives and quartz sand into a destination layer through a high-pressure pump (generally at a pressure of 15,000 PSI) to cause cracks in the reservoir rock. The quartz sand in the fracturing fluid is several times denser than the sand of the formation sand, so it can play a supporting role in the crack, so that the crack is open for a long time, thereby forming a crude oil seepage passage, improving the oil flow environment and improving the crude oil production. Generally speaking, after oil well fracturing, the daily oil production per well can be increased by 3-5 times compared with that before fracturing. The average production increase period is about 6 months, and some oil wells can even reach more than one year. Repeated fracturing can be performed after the production of the well is reduced to the pre-fracture production, and some wells can be repeatedly fractured 5-6 times, or even 7-8 times. The main equipment for fracturing operations is the fracturing train or the fracturing skid. One set of fracturing trucks generally consists of six fracturing pump trucks, two sand mixing trucks, two instrument trucks and one manifold truck. For fracturing operations requiring high displacement and high pressure wells (typically 8,000-18,000 water horsepower), more fracturing trucks are required. The fracturing skid set refers to the fracturing device installed on the skid after the chassis is removed, and is mainly used for the fracturing operation on the offshore drilling platform and the desert Gobi Desert. In recent years, the annual demand for domestic fracturing equipment is above 10 sets of skid sets. Domestically produced fracturing equipment has rapidly replaced imports. Domestic fracturing equipment has occupied 95% of the domestic market share and entered the international market. We use the following methods to roughly calculate the market demand for shale gas pressure cracking equipment: (1) According to empirical data, fracturing equipment accounts for about 20% of equipment investment; we previously thought that China's total investment in shale gas from 2012 to 2020 At around 800 billion yuan; equipment accounts for 25%, and total equipment demand is around 200 billion yuan. If fracturing equipment accounts for about 20% of equipment investment, then by 2020 China's shale gas development will require about 40 billion yuan of fracturing equipment, with an annual average of 4 billion to 5 billion yuan. (2) Usually a single set of fracturing equipment consists of 10 sets of 2000 horsepower fracturing trucks. The price of a typical type 2000 fracturing truck is about 10 million yuan. The value of each set of fracturing trucks is 1 About 100 million yuan. Generally, a single set of fracturing equipment is fractured 150 times at full load every year. According to 70% working time, 100 wells can be fractured. Assuming each shale gas well needs to be fractured once a year, we initially obtain the number of wells and fracturing trucks. The proportional relationship of the groups is 100:1. If the shale gas drilling reaches 40,000 in 2020, 400 sets of fracturing trucks are needed. According to the calculation of 100 million yuan per set, the total demand for fracturing equipment is about 40 billion yuan. (3) According to the experience of shale gas development in North America, every 100 million cubic meters need to be fracturing with 10,000 water horsepower fracturing trains; 60 billion cubic meters need to be fractured with 6 million water horsepower vehicles; For 10 sets of 2000 water horsepower fracturing trucks, 300 sets of fracturing trucks are required; according to the calculation of 100 million yuan per set, the total demand for fracturing equipment is about 30 billion yuan. We combine the above three calculation methods and find that the first two are basically the same, and the third method is also similar, and the calculation results of the first two are used. We believe that China's shale gas development in 2012-2020 will require about 40 billion yuan of fracturing equipment, with an annual average of 4 billion to 5 billion yuan. The main domestic production enterprises of fracturing equipment include oil four-machine factory, four-machine racing, Lanzhou general-purpose machine, medium-oil special vehicle and Jerry shares. Among them, Jerry, a listed company, has outstanding performance in various fields such as fracturing equipment and cementing equipment, and its development prospects are good. (II) Exploration link: The front-end link is the first to benefit from oil and gas exploration and development. It is the front-end link of the oil and gas industry, including the design and implementation of resource search and development programs, maintaining the stability of proven resources and ensuring the sustainable development of the petroleum industry. It is of great significance. Oil and gas resources exploration and development technology is based on geophysical exploration, similar to “CT” for the earth, that is, using seismic and geological information to analyze the stratigraphic structure of the exploration area, find favorable reservoirs, and guide drilling and oilfield development. Oil and gas exploration is divided into seismic exploration and non-seismic exploration. Seismic exploration is one of the most important methods in geophysical exploration. Its principle is that when elastic waves caused by artificially creating strong vibrations (generally explosions not deep underground) propagate in rocks, they encounter rock formations. The interface produces a reflected or refracted wave, which is recorded with a highly sensitive instrument when it returns to the ground. The depth and shape of the rock interface at which the reflected or refracted wave occurs is determined based on the wave propagation path and time. Underground geological formations to find oil and gas traps. In recent years, with the continuous growth of exploration and development investment by global oil companies, the global oil and gas exploration equipment and service market has grown rapidly. According to Spears&Associates, the global oil and gas exploration equipment and services market reached $12.458 billion in 2010. In 2011, the global oil and gas equipment and services market was around US$300 billion, of which exploration equipment and services accounted for 4.5% of the global oil and gas equipment and services market. , about $ 13.5 billion. Among them, from 2000 to 2008, the seismic data processing explained that the industry market scale increased from 1.416 billion US dollars to 5.016 billion US dollars, an increase of 2.54 times, and the compound annual growth rate reached 15.09%. Due to the significant technical barriers, the world's exploration and development technology services are monopolized by a small number of service giants. The market share of the top 5 service providers has stabilized at around 80%, namely CGGVIERITAS, WESTERNGECO, PGS, Oriental Geophysical Exploration, and FUGRO. Domestic listed companies mainly include Hengtai Epp and Potential Hengxin. (3) Drilling equipment: large demand for drilling accessories Oil and gas drilling rigs are a group of very complicated large-scale complete sets of equipment, in addition to general land oil and natural gas drilling, as well as in deserts, alpine, plateaus, swamps, shoals, and oceans. The drilling rig used, the oil drilling rig working in different environments should be able to withstand the harsh natural conditions such as sand, low temperature, seawater corrosion and wave washing. At the same time, it can adapt to the extremely special and complicated working conditions such as high pressure, high temperature, pollution, erosion and corrosion in the drilling process. According to the location of the rig, the oil rig is generally divided into two parts: the land rig and the ocean rig. According to the difference of drilling depth, the drilling rig with a depth of 5000~7000 meters is generally called a deep well drilling rig, and the drilling rig with a depth of 9000~12000 meters is called an extra deep drilling rig. At present, there are more than 6,000 oil rigs in the world, which are produced in more than 20 countries. Among them, the United States, China and Germany and other countries have strong competitiveness and can produce high-quality complete sets of oil drilling equipment products. At present, the land drilling rigs with a drilling depth of 1500~12,000 meters have been formed into a series, which has the ability to produce 1500~12000 meters mechanical transmission, electric drive, top drive land, desert, polar all kinds of complete drilling rigs. At present, China has an annual production capacity of 400 drilling rigs, accounting for about one-third of the world's annual drilling rig production, but the manufacturing cost is 25% to 35% lower than that of other producing countries. According to the research of Spears, in recent years, China's drilling activities will continue to increase, and the demand for drilling rigs will be strong. The number of drilling oil and gas wells in China will increase from 16,850 in 2006 to 21,321 in 2012, and the total demand for drilling rigs will be around 1,125. By 2012, the new demand for land drilling in China is around 200 units. We believe that due to the large inventory of drilling rigs, the growth rate of new drilling demand is not fast; and the rig accessories, especially those such as drill bits, have relatively good demand. Domestic drilling accessories listed companies mainly include Jiang Diamond shares and Shandong Molong. (IV) Logging equipment: high-end imaging logging demand is good Logging technology is a cutting-edge technology in the petroleum field, and is a key technology in oil and gas exploration and development, and its technical content is high. Logging instruments are a comprehensive application of sound, light, electricity, nuclear, magnetic, electronic, materials, geology, geophysical and other disciplines. They are characterized by intensive technology and high unit price. The oil and gas logging industry includes the manufacture of petroleum logging instruments and the provision of logging engineering services. Logging instruments are mainly used to provide logging engineering services, that is, using sound, light, electricity, nuclear, magnetic, geological, geophysical and other disciplines to collect lithology of the formation and porosity of the formation by collecting relevant information of the underground stratum. , permeability, saturation, etc., to determine the location and content of oil, gas, water layer, explain the thickness of oil, gas layer, water saturation and reservoir properties and to monitor the quality of drilling and cementing engineering, is the discovery of oil and gas One of the most important tools for collecting and assessing oil and gas reserves and their production. Logging engineering services are based on the needs of exploration and development, using well logging instruments to log wells in various exploration areas of the oilfield, and submit logging data and analysis reports. As China's petroleum exploration and development further expands into complex lithologic reservoirs and subtle reservoirs, the difficulty of exploration is becoming more and more difficult, and the demand for high-end, personalized logging instruments by logging service units is further increased. Most of the high-end imaging logging tools in use in China are introduced, and they are gradually aging, and there is an urgent need for replacement. Therefore, the demand for domestic advanced imaging logging tools is increasing. According to the statistics of the China Petroleum and Petrochemical Equipment Industry Association, there are currently about 1,000 sets of existing logging tools in China, of which imaging logging instruments account for about 25%. With the increasing complexity of exploration and development objects, the market demand for high-end imaging logging instruments continues to grow. At present, foreign similar logging instruments are expensive, and Schlumberger, Baker Hughes and other international logging market leaders are gradually adjusting their strategies. In the Chinese market, logging services are mainly used, and a complete set of logging tools has been rarely sold. . According to the statistics of China Petroleum and Petrochemical Equipment Industry Association, the sales revenue of China's oil and gas logging equipment market reached 2.19 billion yuan in 2010. It is estimated that the sales revenue of China's oil and gas logging equipment market will reach 2.57 billion yuan in 2011, by 2015. It reached 4.74 billion yuan, with an average annual growth rate of about 17%. At present, the development of shale gas in China is still in its infancy, and the logging operation is mainly completed by foreign oil service companies. The domestic logging equipment market for shale gas is still very small. Demand for shale gas logging equipment is expected to grow rapidly over the next 10 years. Domestic logging equipment companies mainly include China Oil Logging, Shengli Weiye, Huan Ding Technology, China Power 22, China National Offshore Oil Co., Ltd. and Ji Ai Technology. Among the listed companies, we are optimistic about the development prospects of Jiai Technology. (5) Perforating equipment: demand for composite perforating technology is good. Perforating is an important factor determining the output of oil and gas wells. It is called “one foot” in the field of oil and gas exploration and development. In the process of oil and gas exploration and development, the reservoir area is first discovered through exploration, and then the ground and underground wellbore are connected through drilling operations, and the connection between the wellbore and the reservoir is achieved through perforation. Perforation is the transfer of a specialized instrument to a certain section of the oil and gas well, opening some channels in the casing, cement ring and formation, so that the oil and gas from the formation into the oil and gas well system work process. The ultimate success (capacity and life) of a well depends on how well the wellbore is connected to the formation. The number of wells is the core indicator that determines the size of the oil and gas well perforation market. In a well, there are several discrete layers of oil along the vertical direction. The perforation of oil and gas wells is usually a stratification operation for different oil layers. Each new well is usually opened first and perforated, ie a new drilling perforation. When the layer is oiled to a certain stage, the other layers of the same well are perforated, that is, the new layer is perforated. A large number of production processes in the production wells will also result in re-perforation in the production wells due to changes in the formation or blockage of solid-phase particles during the production process, in order to restore and rebuild the production capacity, ie in the production well (old layer) . At present, the total number of new wells and wells in the world is more than 1 million, and the annual perforation meters of global oil and gas wells is about 5 million meters. According to the per-meter perforator price of $2,000, the annual global market for oil and gas well perforation is about $10 billion. The market size of domestic oil and gas well perforation can be measured by the consumption of perforating bullets. Perforating projectile is the necessary blasting material for the perforation of oil and gas wells. Since the perforating projectile is an explosive, its annual production volume needs to be reported to the former Defense Science and Technology Industry Committee (now the National Defense Science and Technology Industry Bureau) for approval. In 2007-2009, the consumption of special energy-collecting perforating bullets for oil and gas wells in the country was 9.55 million, 10.74 million and 11.5 million, respectively, calculated according to the average of 12 shots per meter of perforated bombs, 2007-2009 The domestic market for perforating is 4.9 billion yuan, 5.2 billion yuan and 5.4 billion yuan respectively. Among them, the economic scale of the composite perforation in 2009 reached 724 million yuan. According to the prediction of China's blasting equipment industry association, by 2012, the overall size of the domestic perforating market will reach 6 billion yuan. The main enterprises in the field of domestic oil and gas well perforation are divided into two categories, one is a professional service company based on traditional energy-collecting perforating technology, and the other is a new technology research and development and promotion enterprise. As the most advanced perforating technology, the composite perforating technology has the advantages that traditional perforating technology can't match in improving oil and gas production. The demand for composite perforating device and operation service relying on compound perforating technology will obviously exceed the traditional poly in the future. Product and operation services that can perforate technology. Major domestic companies in the field of perforating have Daqing Oil Testing and Production Company, China Petroleum Logging Company, China National Offshore Oil Company, Western Drilling Company, Shengli Logging, Great Wall Drilling, Chuanqing Drilling, Bohai Drilling, etc. Tongyuan Petroleum, 204, 213, etc. We are optimistic about Tongyuan Petroleum, a leading company in compound perforating technology.

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