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The Fracking Chemicals Market is significantly influenced by various market factors that play a pivotal role in shaping its dynamics. One of the primary drivers of this market is the increasing global demand for energy. With a growing population and industrialization, there is an escalating need for unconventional sources of oil and gas, and hydraulic fracturing, commonly known as fracking, has emerged as a key method to extract these resources. This surge in energy demand has directly contributed to the expansion of the fracking chemicals market, as these chemicals are integral to the fracking process, aiding in the extraction of hydrocarbons from underground reservoirs.
Moreover, government policies and regulations also exert a considerable impact on the fracking chemicals market. Environmental concerns related to fracking have led to the implementation of stringent regulations governing the use of chemicals in the process. As governments worldwide seek to strike a balance between energy needs and environmental sustainability, the market for fracking chemicals is influenced by the evolving regulatory landscape. Compliance with these regulations not only affects the composition of fracking chemicals but also stimulates innovation in the industry, driving the development of environmentally friendly alternatives.
Technological advancements represent another crucial factor shaping the fracking chemicals market. Continuous research and development efforts have led to the introduction of advanced fracking technologies and chemicals that enhance the efficiency and sustainability of the extraction process. Innovations such as the use of nanotechnology in fracking fluids and the development of bio-based chemicals are driving market growth and transforming the industry landscape. The adoption of these technological advancements by key players in the market plays a pivotal role in gaining a competitive edge and meeting the evolving demands of the industry.
Market dynamics are further influenced by the economic landscape. The fracking chemicals market is sensitive to fluctuations in oil and gas prices, which directly impact the level of investment in exploration and production activities. During periods of high oil and gas prices, there is an increased willingness to invest in unconventional extraction methods like fracking, leading to a surge in demand for fracking chemicals. Conversely, during periods of low prices, companies may scale back their operations, impacting the demand for these chemicals.
The geopolitical scenario also casts its shadow on the fracking chemicals market. Regions with abundant shale reserves and favorable regulatory environments tend to attract significant investments in fracking activities. Political stability and international relations play a crucial role in determining the growth prospects of the fracking chemicals market in specific geographical areas. Changes in geopolitical dynamics, trade policies, and global energy alliances can have far-reaching consequences on the market's trajectory.
Additionally, public awareness and perception of fracking practices contribute to market dynamics. Concerns about the environmental impact, water usage, and potential health hazards associated with fracking have led to public debates and activism. This heightened awareness influences public policy decisions, regulatory frameworks, and, subsequently, the market strategies of companies involved in the fracking chemicals industry.
Fracking Chemicals Market Highlights:
Fracking Chemicals Market Overview
The fracking chemicals market is expected to register a CAGR of 6.54% during the forecast period, 2021-2030. Fracking chemicals are the chemicals used in drilling operations along with water and sand to increase the extraction efficiency of hydrocarbons. The composition of the fracking fluid (fracking chemicals, water, and sand mixture) varies with each industry player depending on the availability of water in the manufacturing facility and regulations instructed by local as well as state governments. The hydraulic fluid can be water-based, oil-based, or foam-based. The fracking chemicals help to increase the extraction of oil and natural gas per well by hydraulic fracturing of the rocks by pressurization, thereby reducing the total number of wells needed to extract resources. Fracking chemicals also allow the commercialization of low permeability reservoirs in which oil and gas are not easily found for extraction. Fracking chemicals perform several functions such as a carrier, solvent, biocides, scale inhibitor, friction reducer, additive, corrosion inhibitor, and non-ionic surfactants. Rising demand for oil & gas across the globe owing to the growing fuel & energy demand on account of expanding population is the major growth driver to the global fracking chemicals market. Additionally, shifting trend toward horizontal drilling owing to its systemic mechanism to recover the unusual shale reserves with hydraulic fracturing technology is also contributing to the growth of the fracking chemicals market. Besides this, the continued development of unconventional sources of oil and gas in order to ensure energy security and to lessen dependence on foreign oil imports in many countries are also propelling the growth of the product market significantly. However, many fracking chemicals are identified as toxic and possess high VOC content by the US Environmental Protection Agency (EPA), which may restrict market growth during the forecast period. Moreover, various companies are investing in R&D and are striving toward the development of eco-friendly fracking chemicals. For instance, Halliburton Company has initiated the production of bio-based drill muds from guar gum to expand its product portfolio and meet the stringent regulations by the US EPA against the use of toxic fracking chemicals. Furthermore, non-toxic drilling fluids are developed, such as foam-based fluid (FBF), as an alternative to toxic oil-based fluid (OBF), which is difficult to remove from the drill hole. These research & development activities are expected to exhibit intense growth opportunities to the players operating in the global fracking chemicals market during the forecast period. Global Fracking Chemicals Market Share in 2017, by Type
Source: MRFR Analysis Market Segmentation The global fracking chemicals market has been segmented by type, fluid type, and region. On the basis of the function, the global fracking chemicals market has been segmented into the gelling agent, friction reducer, corrosion inhibitor, biocide, surfactant, scale inhibitor, clay stabilizer, cross-linkers, pH adjusting agent, iron control agent, and others. By fluid type, the global fracking chemical market has been categorized into water-based, oil-based, and foam-based.
Regional Analysis
The global fracking chemicals market has been segmented into five regions, namely Asia-Pacific, North America, Europe, Latin America, and the Middle East and Africa. North America accounted for the largest share of the global fracking chemicals market in 2018 and is expected to show significant growth during the forecast period. The presence of a developed drilling industry due to major shale gas revolution in the US is majorly contributing to the demand for fracking chemicals in the region. Furthermore, advanced technology available to drill and recover oil & gas from unconventional resources is also boosting the market growth at an exponential rate. Europe is another major market for fracking chemicals due to growing offshore oilfield activities in the North Sea for exploring newer reserves. Furthermore, the high rate of deployment of the mud-cap drilling technique in the region is also likely to create new growth opportunities for the fracking chemical companies in the next five years. The market in Asia-Pacific is expected to register the highest CAGR during the forecast period. Rapid industrialization & urbanization in emerging economies of the region have vastly increased the demand for fuel and energy and thus, positively influencing the oilfield industry. The majority of oil & gas exploration and production activities are centered in China, Indonesia, South Korea, Australia, and India. The Middle East & Africa is expected to showcase increasing demand for fracking chemicals during the forecast period due to the high concentration of oilfield reserves and established oil & gas industries in the region. Latin America held the least share of the global fracking chemicals market in 2018 and is also expected to show sluggish growth during the forecast period due to the lesser number of oil & gas reserves in the region.
Key Players
Some of the major players operating in the global fracking chemicals market are AkzoNobel N.V. (The Netherlands), Ashland Inc. (US), Baker Hughes Incorporated (US), Halliburton. (US), Schlumberger Limited (US), BASF SE (Germany), Chevron Phillips Chemical Company (US), Clariant International AG (Switzerland), DowDuPont (US), Albemarle Corporation. (US), FTS International Inc. (US), Calfrac Well Services Ltd. (Canada), and EOG Resources, Inc. (US).
Recent Development
October 2021- Liberty Oilfield Services Inc., a Denver-based company, has announced the completion of acquiring a prominent supplier of proppant delivery equipment, software, and logistics solutions, PropX. The company reported a 12% in third-quarter revenue this year. Liberty becomes the send-largest provider of natural gas & oil producers with fracking and well-completion services, with this deal worth USD90 million. The deal comprised of USD5 million in cash and the other 5.8 million shares of Liberty’s common stock having net valued of over USD76.5 million based on a 30-day average closing share price of USD13.08. PropX, established in 2016, is a prominent supplier of last-mile proppant delivery solutions, including logistics software and proppant handling equipment across the North American region. The company offers advanced eco-friendly technology coupled with benefits such as canceling out emissions, reducing noise, driving logistics efficiency, wellsite proppant handling equipment, and better dry and wet sand containers. April 2021- California is set to ban new oil fracking by 2024 under an executive order that Gov. Gavin Newsom, announced that with small fanfare following months of confusing mixed messages.The order came as a shock to the oil firms in the state but a narrow victory for environmentalists, who have been forcing Newsom to do more to combat fossil fuels, pollutions, and climate change pollution in disadvantaged communities. Intended Audience
- Fracking chemicals manufacturers
- Traders and distributors of fracking chemicals
- Research and development institutes
- Potential investors
- Raw material suppliers
- Nationalized laboratory
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