GVR Report cover Horizontal Directional Drilling Market Size, Share & Trends Report

Horizontal Directional Drilling Market Size, Share & Trends Analysis Report By Machine Type, By Parts (Rigs, Pipes, Bits, Reamers), By Application, By End-use, By Region, And Segment Forecasts, 2021 - 2028

  • Report ID: 978-1-68038-589-2
  • Number of Pages: 250
  • Format: Electronic (PDF)

Report Overview

The global horizontal directional drilling market size was valued at USD 8.16 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 6.7% from 2021 to 2028. The Horizontal Directional Drilling (HDD) technique is used to accurately undertake drilling operations and back ream the required pipe, sidelining various obstacles on the bore path without causing significant collateral damage to the subsurface ecosystems. Rising concerns about the need to minimalize environmental damage caused by rapid infrastructure development across the globe worldwide are contributing significantly to the increased adoption of horizontal directional drilling. Growing utility installations, burgeoning investments in shale gas development projects, and rising expenditures aimed at various developments across the telecom sector to offer high-speed connectivity are some of the other factors contributing to market growth.

U.S. horizontal directional drilling machines market size, by machine type, 2018 - 2028 (USD Million)

Over the past few years, the horizontal directional drilling technique has emerged as one of the most popular trenchless drilling technologies. This horizontal boring method requires fewer boreholes to be drilled and maintained. Growth prospects of the industry are subject to heavy investments as the equipment needed for trenchless boring costs much higher than conventional open-cut methods. As the setups are costly, customers opt to rent out the entire setup from contractors. Furthermore, various mid-sized companies also hire service providers for end-to-end projects. As a result, both horizontal directional drilling machine manufacturers and service providers hold a strong position in the market.

Since its inception, the horizontal trenchless technique has gained significant traction owing to its deployment from a single location in extremely rough sub-surface and the ability to hit multiple target zones. The prevalence of disruptive digital technologies, including 3D visualization, 3D earth models, and automation, has led to faster implementation, reduced noise and waste, and enhanced underground accessibility. Additionally, these technologies have enabled engineers, geoscientists, and other related personnel to more accurately visualize and optimize the Rate of Penetration (ROP) of the bore path. Technological advancements have also played a major role in helping the horizontal trenchless technique achieve a prominent position in drilling applications across oilfields, renewable gas exploration, and long-distance optical fiber installations in offshore locations.

Horizontal directional drilling is primarily employed for applications such as the installation of electrical conductors, utility transmission and supply lines, and communication conduits and cables. The cross bore technique that enables the intersection of two or more pipelines underneath the surface poses a threat to these directional boring industry workers and the public. This may be attributed to the lack of visibility in determining the track of the drilling activities in sub-surface locations. The cross-bore intersection of various utilities can often result in explosions, resulting in injuries and death. To avoid this, Occupational Safety and Health Administration (OSHA) mandates directional boring operators to check for structures indicating subversive utility installations or any other obstructions along the drill path before physically drilling entry and exit holes in the required locations. Apart from this, the market is also subjected to various environmental norms that emphasize reducing the ecological impact during underground construction activities.

The COVID-19 pandemic resulted in a temporary shutdown of horizontal directional drilling activities at several sites in a range of industries owing to stringent government lockdown regulations to arrest the spread of the disease. The oilfield sector faced major operational concerns as companies temporarily halted upstream and downstream activities, resulting in the abrupt decline in oil and gas production. Furthermore, oil prices dropped owing to a significant reduction in the frequency of transportation worldwide on the heels of a price war among the U.S., Saudi Arabia, and Russia. As a result, incumbents of horizontal directional services and the machine industry faced a downturn in demand. However, continual measures taken by world governments for mitigating the impact of the pandemic on oil and gas exploration companies are expected to allow for recovery in the horizontal directional drilling market in the near future.

Machine Type Insights

The Rotary Steerable System (RSS) segment dominated the HDD machines market in 2020 with a revenue share of over 70.0%. The RSS machine type uses push- and point-the-bit methods for accurate directional control of drilling and forms real-time corrections. The ability to enhance the ROP, reduction in drag and torque, and smoother borehole production, are some of the factors anticipated to increase the popularity of RSS. Furthermore, service providers invest dynamically in the upgrade of RSS machines to offer infallible drilling services, even under harsh underground conditions.

On the other hand, conventional horizontal directional drilling is still preferred by SMEs due to its low operational cost compared to RSS. The conventional machine type involves immovable and skid-mounted rigs that require arrangements to regulate their position. Conventional horizontal directional drilling allows boring up to a depth of 30,000 feet and can be deployed for applications such as geothermal energy distribution, soil mapping, and sewage disposal.

Parts Insights

The rigs segment captured a revenue share of over 55.0% of the overall market in 2020. An increasing number of oil and gas and telecommunication industry projects are the main factors driving the demand for rigs. Various technological advancements in rig infrastructure allow the end-user to carry out operations at a very high optimization rate. For instance, an automated system embedded into the control system of rigs smoothly guides the equipment to install pipelines for distant entry and exit points. However, rigs are costly and require regular maintenance for improving their operational life.

The pipes segment is expected to register the highest CAGR over the forecast period. Industry players are increasingly investing in the development of drilling pipes that can withstand high underground pressure. High-Density Polyethylene (HDPE) pipes are favored over steel or concrete pipelines owing to their high impermeability features. At zero allowable water leakage, the HDPE pipes are highly efficient as compared to Polyvinyl Chloride (PVC) and ductile iron pipes, which have a leakage rate of 10% to 20%. Moreover, their resistance to corrosion and low weight contributes to the higher preference for HDPE pipes.

Rig Type Insights

The midi rig segment accounted for around 40.0% of the revenue share in 2020. Midi rigs are utilized for medium-sized projects that require a pullback force of up to 40,000 pounds with a pipe diameter of up to 24-inches, length of up to 1000-feet, and depth of up to 75-feet. The deployment rate of mini rigs has increased with the rising need to satisfy the demand for clean energy and the subsequent rise in investments in the natural gas industry and the constant rise in utility construction projects such as the installation of gas pipelines. Moreover, the rise in the number of telecommunication projects, such as 4G and 5G cellular network expansion, can also be attributed to the rising demand for midi rigs over the years.

Maxi rigs are utilized for directional drilling length of 6,000-feet and torque of around 20,000 pounds. The torque requirement increases while installing large diameter pipes over longer distances. Furthermore, higher pullback force is essential for conducting horizontal boring operations in difficult ground conditions like tar, sand, and shale rock. Thus, maxi rigs are more suitable for heavy pipeline installation in deep-water projects such as offshore oil & gas pipeline deployment.

Rig Sales Insights

The aftermarket segment is expected to foresee the highest growth with a CAGR of around 4.5% during the forecast period. Previously used horizontal drilling rigs have emerged as the most prominent investments for end-users with limited funds. Newly entered operators with a specific list of requirements prefer buying rigs of previous models with almost the same functions as the new upgraded version, which are often available at a lower price. Aftermarket setups are also favorable for sturdily built rigs that are anticipated to be used for drilling operations in rough conditions. However, used rigs with worn-out components require higher maintenance costs and lead to productivity loss and rig uptime contractual obligations. Thus, end-customers must perform a quality check to rectify electrical harnesses, sprockets, hydraulic components, and bearings.

On the other hand, new rigs are owned mainly by multinational companies or large contractors to carry out immense upstream and downstream activities in the oil and gas sector. Compared to aftermarket rigs, new rigs help avoid the risk of using worn-out drill pipes, the repair cost of old drilling machinery, and a stressed drill rod. New directional drilling machines are thoroughly inspected and are often covered under a warranty. Furthermore, the constantly changing environmental regulations require that companies employ the latest horizontal directional drilling machines that abide by the new regulations for boring operations.

Application Insights

The offshore segment is projected to foresee the highest growth with a CAGR of around 10.0% over the forecast period. Due to the vast untapped oil & gas reservoirs, exploration and production activities are anticipated to be carried out at a larger scale across the globe in the near future. Furthermore, the decline in the average breakeven price for all non-permitted projects is resulting in cheaper oil production at offshore sites.

Onshore projects, on the contrary, are less expensive than offshore horizontal directional drilling projects due to the lower infrastructure and maintenance cost. The onshore horizontal directional boring projects are highly affected by the crude oil price variations. The heavy layout of fiber optic cables by the telecommunication sector in the offshore and onshore areas to provide 4G and 5G networking services are adding to the growth prospects of both segments.

End-use Insights

The oil and gas extraction segment dominated the market in 2020 with a revenue share of over 35.0%. According to a publication by Baker Hughes, the average worldwide oil and gas rig count till June 2021 was 1,325. The well-established infrastructure presents high demand for boring rigs and contributes to the high market share of the oil and gas extraction segment. Moreover, the need to address the soaring prices of oil exploration and production activities on unexploited locations is expected to contribute to the dominance of the segment.

Global horizontal directional drilling services market share, by end-use, 2020 (%)

The telecommunication segment is predicted to account for the highest CAGR over the forecast period. The increasing demand for faster broadband connectivity is compelling telecommunication providers to employ newer and more reliable drilling services such as horizontal directional drilling for expanding their network of optic fiber cables. HDD offers the ability to deploy conduits and pipe installations through holes of nearly 4 feet diameter and 6500 feet in length for telecommunication applications at offshore locations. Furthermore, the escalating demand for 4G and 5G networks is expected to drive the growth of the telecommunication segment over the forecasted period.

Regional Insights

The Asia Pacific region is anticipated to register the highest CAGR of around 10.0% over the forecast period. The national energy infrastructure in China is focusing towards adoption of renewable energy sources for safe, sufficient, and clean energy growth. This has led to an increase in massive infrastructure projects in the country, driving the adoption of advanced drilling equipment. Furthermore, directional boring machines offered for horizontal drilling by Chinese companies are relatively less expensive. Moreover, the rising investments in the region’s telecommunication sector to deploy 4G and 5G networks are driving the growth of the regional market.

North America accounted for the highest revenue share in 2020 owing to the oil and gas exploration activities in the region. In 2020, The U.S. Energy Information Administration reported that liquid fuel consumption was reportedly 20.54 million barrels per day as compared to the production of 18.12 million barrels per day in 2019. Apart from this, the growing number of infrastructure and utility projects is driving the demand for horizontal directional drilling equipment and services in North America. The MEA region emerged as the second-highest employer of boring services for oil and gas excavation activities.

Key Companies and Market Share Insights

Key companies operating in the market for horizontal directional drilling machines are Nabors Industries Ltd.; The Toro Company; The Charles Machine Works, Inc.; Vermeer Corporation; Herrenknecht AG; and XCMG. Prominent industry players are investing in R&D activities to assist their customers in optimizing their boring operations. These players have been aggressively developing state-of-the-art equipment with an intent to uphold their dominance in the market. For instance, In November 2019, The Charles Machine Works Inc. Company announced the launch of the ride-on trencher, RT80, with a tier-4, 74.5-horsepower diesel engine. The trencher is targeted toward urban utility job sites.

On the other hand, HDD service providers play an essential role in delivering projects on a contractual basis. These industry participants are responsible for the installation, maintenance, and inspection of drilling activities. The companies emphasize long-term collaborations with their customers to develop an ongoing business model. For instance, in April 2018, UEA was appointed by Telstra Corporation Limited, an Australia-based Telecommunications Company, to install directional bore telecommunications works for the Indigo-West cable system between Singapore and Perth. The alliance aimed at improving the communication traffic in the growing Asian markets. Some of the prominent players operating in the global horizontal directional drilling market are:

  • Nabors Industries Ltd.

  • The Toro Company

  • The Charles Machine Works, Inc.

  • Vermeer Corporation

  • Herrenknecht AG

  • XCMG

Horizontal Directional Drilling Market Report Scope

Report Attribute


Market size value in 2021

USD 8.02 billion

Revenue forecast in 2028

USD 14.86 billion

Growth rate

CAGR of 6.7% from 2021 to 2028

Base year for estimation


Historical data

2018 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Machine type, parts, rig types, rig sales, application, end-use, region

Regional scope

North America; Europe; Asia Pacific; Latin America; MEA

Country scope

U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico; KSA; UAE; Kuwait

Key companies profiled

Nabors Industries Ltd.; The Toro Company; The Charles Machine Works, Inc.; Vermeer Corporation; Herrenknecht AG; XCMG

Customization scope

Free report customization (equivalent to up to 8 analyst’s working days) with purchase. Addition or alteration to country, regional & segment scope.

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2028. For this study, Grand View Research has segmented the global horizontal directional drilling market report based on machine type, parts, rig types, rig sales, application, end use, and region:

  • Machine Type Outlook (Revenue, USD Billion, 2018 - 2028)

    • Conventional

    • Rotary Steerable System

  • Machines Parts Outlook (Revenue, USD Billion, 2018 - 2028)

    • Rigs

      • Type

        • Mini

        • Midi

        • Maxi

      • Sales

        • New sales

        • Aftermarket

    • Pipes

    • Bits

    • Reamers

    • Others

  • Services Application Outlook (Revenue, USD Billion, 2018 - 2028)

    • Onshore

    • Offshore

  • Services End-use Outlook (Revenue, USD Billion, 2018 - 2028)

    • Oil & Gas Extraction

    • Utility

    • Telecommunication

    • Others

  • Regional Outlook (Revenue, USD Billion, 2018 - 2028)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

    • Asia-Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

      • Mexico

    • Middle East & Africa (MEA)

      • KSA

      • UAE

      • Kuwait

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