Oilfield Stimulation Chemicals Market - Forecast(2023 - 2028)

Oilfield Stimulation Chemicals Market Overview

Oilfield stimulation chemicals Market size is forecast to reach $4.27 billion by 2026, after growing at a CAGR of 9.8% during 2021-2026 due to increasing demand from oil & gas industry. Oilfield stimulation chemicals reduce the consumption of water and save energy during fracturing. Oilfield stimulation chemicals such as gelling agents, friction reducers, surfactants, corrosion & scale inhibitors, acids retarders, clay stabilizers, and others are used in exploration and production activities. The gelling agent is frequently adopted during the oil extraction process and reduces the viscosity of fluids, thus it is the most widely used oilfield stimulation chemical in the oil industry. Thus, the increasing growth of the oil & gas industry is estimated to growing the consumption of oilfields stimulation chemicals.

Impact of Covid-19

Oil & gas sectors are one of the major industries that have got a hit because of COVID-19 pandemic. Due to lockdown the exportation and production of oils were stopped. According to the US Energy Information Administration (EIA), crude oil production fell by 8% in 2020 and is expected to fall by 230,000 barrels per day (bpd) in 2021. Thus, the decline in production hindered the consumption of oilfield stimulation chemicals.

Report Coverage

The report: “Oilfield Stimulation Chemicals Market – Forecast (2021-2026)”, by IndustryARC, covers an in-depth analysis of the following segments of the Oilfield Stimulation Chemicals Industry.

By Product: Biocides & Acids, Friction Reducer, Clay Stabilizers, Surfactants, Corrosion & Scale Inhibitors, Gelling Agents, Wetting Agents, Acid Retarders, Crosslinkers, Iron Control Agents, and others.
By Application: Hydraulic Fracturing, Matrix Acidization, Acid Fracking, and Others.
By Geography: North America (USA, Canada, and Mexico), Europe (UK, Germany, Italy, France, Spain, Netherlands, Russia, Belgium, and Rest of Europe), APAC (China, Japan, India, South Korea, Australia, Taiwan, Indonesia, Malaysia, and Rest of Asia Pacific), South America (Brazil, Argentina, Colombia, Chile, and Rest of South America), and RoW (Middle East and Africa).

Key Takeaways

• North America dominates the Oilfield stimulation chemicals Market due to increasing consumption and production of oil, also investment in oil extraction will enhance the market demand for oilfield stimulation chemicals.
• According to The Canadian Association of Petroleum Producers (CAPP), investments in oil sands operations and conventional oil & gas production are expected to rise nearly from US$19 billion (C$24 billion) in 2020 to US$21 billion (C$27 billion) in 2021.
• Growing adoption of oilfields stimulation chemicals such as gelling agents, friction reducer, corrosion inhibitors, and others in the industry to increases productivity of fluids.
• Increasing consumption of chemicals for crude oil & shale gas and save energy during fracturing of fluids will create growth for the Oilfield stimulation chemicals Market.

Figure: North America Oilfield Stimulation Chemicals Market Revenue, 2021-2026 (US$ Billion)

Oilfield Stimulation Chemicals Market Segment Analysis – By Product

Gelling agent segment is expected to lead the market of oilfield stimulation chemicals in 2020 as gelling agents provide fluid loss control and viscosity control. The gelling agent is designed for the oil wells that have a high temperature at the bottom. Additionally, gelling agents are mainly used for water shutoff and to limit sand production. Apart from this friction reducer is used as a drag reducer in oil well fracturing. Hence, due to increasing adoption of chemicals for oil extraction is estimated to growing the market size of oilfield stimulation chemicals.

Oilfield Stimulation Chemicals Market Segment Analysis – By Application

Hydraulic fracturing segment dominated the Oilfield stimulation chemicals Market in 2020 and is growing at a CAGR of 9.5% during 2021-2026 owing to the exploration of shale gas. Hydraulic fracturing creates high conductivity with a large area of formation that may exist in the wellbore area. Oilfield chemicals such as crosslinkers are maintaining fluid viscosity and friction reducer minimizes friction between the fluid and pipe during fracturing. Thus, with help of various chemicals, hydraulic fracturing cures the treatment of shale gas production. Hence, due to the better productivity of shale gas hydraulic fracturing oilfield stimulation chemicals are widely used for this application. 

Oilfield Stimulation Chemicals Market Geography - Segment Analysis

North America dominated the Oilfield stimulation chemicals Market with more than 30% in 2020 due to the increasing production of crude oil and the rapid consumption of shale gas in the region. According to U.S. Energy Information Administration (EIA), crude oil production is expected to rise on average 11.1 million b/d in 2021 and 12.0 million b/d in 2022. Hence, residential commercial and industrial natural gas consumption is expected to reach 13.1 Bcf/d, 9.3 Bcf/d, and 23.8 Bcf/d, respectively in 2021, according to EIA. Furthermore, according to U.S. Energy Information Administration, electric power generated with natural gas is expected to average 36% in 2021 and 35% in 2022. Apart from this, according to the Canadian Association of Petroleum Producers (CAPP), oil and gas companies will invest C$27.3 billion in 2021. Therefore, growing consumption and projects are supporting the demand for the Oilfield stimulation chemicals Market in the region.

Oilfield Stimulation Chemicals Drivers

Growing Production of Oil & Gas is expected to Grow Consumption of Oilfield Stimulation Chemicals

Oilfield stimulation chemicals such as gelling agents are used for increasing the viscosity of hydrofluoric fluids. Friction reducer as an alternative of gelling agent, which helps to prevent formation plugging and piping in the oil wells. According to U.S. Energy Information Administration (EIA), In 2020, the United States natural gas production reached 34.4 trillion cubic feet (Tcf). According to the Oil & Natural Gas Corporation (ONGC), in India, crude oil production was 1788.92 TMT in 2020 which is 1.24 higher than 2019. According to IBEF, oil production is expected to rise 36 billion cubic meters (bcm) in 2021. Hence, the growth in the oil & gas production sector will influence the demand for oilfield stimulation chemicals.

Increasing Investment in North America in Oil & Gas Sector

Oilfields stimulation chemicals such as gelling agent, scale & corrosion inhibitor, friction reducer, acid retarders, and others are widely used in shale gas production. Also, these chemicals help to promote the exploration of oil & gas. Thus, increasing investment in the oil & gas industry in North America is estimated to growing the consumption of these chemicals. According to the Canadian Association of Petroleum Producers (CAPP), Capital investment in Alberta’s oil sands is expected to increase from $6.7 billion in 2020 to $7.3 billion in 2021. According to Energy Shale Gas Production, the total natural gas production is projected to contribute 30% and more than 75% in Canada & Mexico, respectively by 2040. Hence, all such factors are expected to drive the growth of the oil and gas industry in North America, which is further expected to increase the demand for the Oilfield stimulation chemicals Market.

Oilfield Stimulation Chemicals Challenges

Increasing Preference for Renewable Sources of Energy

While oil demand falls with the adoption of renewable sources of energy and gas technologies, there is a need for oil companies to have insight into new advanced technology. Oil companies pursue new drilling and extraction technologies that help to increase the sustainability of energy sources. Oil companies adopted a new process that improves oil recovery and improves the production of hydrocarbons. Increasing adoption of renewable sources of energy includes bioenergy, hydropower, geothermal energy, solar energy, wind, and wave energy may hamper the market of oilfield stimulation chemicals.

Adverse Health and Environment Impact of Biocides

Biocides exposure is harmful to health as they contain toxic, carcinogenic, endocrine-disrupting properties which affect human health and the environment. Biocides irritate skin, eyes. They can cause pollution and harm wildlife when they spill onto the land respiratory system, nervous system, and other organisms. Thus they are harmful to health and the environment which is limiting the consumption of oilfield stimulation chemicals.

Oilfield Stimulation Chemicals Market Landscape

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the oilfield stimulation chemicals. Major players in the Oilfield stimulation chemicals are BASF, Baker Hughes, Dow, Flotek Industries, Halliburton, Schlumberger, Chevron Phillips Chemical, Clariant, Ashland, AkzoNobel Oilfield, Solvay, and among others. 

Acquisitions/Technology Launches

• In Feb 2019, Halliburton Company announced to build the first Saudi Arabia-based Oilfield Stimulation and specialty chemical manufacturing plant. This plant is capable to manufacture a broad range of chemicals for stimulation and production from the refineries.

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