Analysis of the North American and European Oilfield
Chemicals Market
Shale Gas Industry Thrives on Advanced Oilfield Chem...
Research Team

Lead Analyst

Research Manager

Anna Jarosik

Leonidas Dokos

Industry Analyst
Chemicals, Materials and Foo...
Contents
Section

Slide Numbers

Executive Summary

4

Market Overview

10

Total Market of Oilfield Chemicals in Shale Ga...
Executive Summary

M932-39

4
Executive Summary
• Shale gas is an unconventional natural gas (NG). Technological advancements, especially
in hydraulic f...
Executive Summary (continued)
• This research service analyses the impact of shale gas on the oilfield chemicals market.
M...
Executive Summary—Market Engineering Measurements
Total Market of Oilfield Chemicals in Shale Gas: North America and Europ...
Executive Summary—Market Engineering Measurements
(continued)
Competitor Overview
Number of
Competitors
>40 at supply
leve...
Executive Summary—CEO’s Perspective

1

The shale gas industry offers emerging
growth opportunity, but it is initially abu...
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North American and European Oilfield Chemicals Market - Executive Summary. Shale Gas Industry Thrives on Advanced Oilfield Chemical Solutions

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This research service analyses the impact of a shale gas on the oilfield chemicals market in North America and Europe from 2009 to 2019, with 2012 as the base year. It also analyses the situation, developments, trends, and future opportunities. The market is divided into the following segments by chemical type: drilling chemicals, stimulation chemicals, cementing chemicals, hydraulic fracturing chemicals, and wastewater treatment chemicals. Along with Canada, the United States and Mexico, the study analyses Austria, Balkan countries, Baltic countries, Benelux countries, Czech Republic and Slovak Republic, France, Germany, Hungary, Ireland, Iberian countries, Italy, Nordic countries, Poland, Switzerland, and the United Kingdom.

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North American and European Oilfield Chemicals Market - Executive Summary. Shale Gas Industry Thrives on Advanced Oilfield Chemical Solutions

  1. 1. Analysis of the North American and European Oilfield Chemicals Market Shale Gas Industry Thrives on Advanced Oilfield Chemical Solutions M932-39 November 2013
  2. 2. Research Team Lead Analyst Research Manager Anna Jarosik Leonidas Dokos Industry Analyst Chemicals, Materials and Food (CMF) Global Programme Manager Chemicals, Materials and Food (CMF) (48) 22 481 62 36 (44) 186 539 86 85 anna.jarosik@frost.com leonidas.dokos@frost.com Contributing Analyst Strategic Review Committee Leader Michael Mbogoro Brian Balmer Research Consultant Chemicals, Materials and Food (CMF) Industry Principal, Performance Materials Chemicals, Materials and Food (CMF) (44) 186 539 86 61 michael.mbogoro@frost.com M932-39 (44) 186 539 86 34 brian.balmer@frost.com 2
  3. 3. Contents Section Slide Numbers Executive Summary 4 Market Overview 10 Total Market of Oilfield Chemicals in Shale Gas - • External Challenges: Drivers and Restraints 47 • Forecasts and Trends 60 • Market Share and Competitive Analysis 84 Market Segments - • Drilling Chemicals Segment Breakdown 98 • Stimulation Chemicals Segment Breakdown 107 • Cementing Chemicals Segment Breakdown 116 • Hydraulic Fracturing Chemicals Segment Breakdown 125 • Wastewater Treatment Chemicals Segment Breakdown 133 The Last Word (Conclusions and Implications) 142 Appendix 145 M932-39 3
  4. 4. Executive Summary M932-39 4
  5. 5. Executive Summary • Shale gas is an unconventional natural gas (NG). Technological advancements, especially in hydraulic fracturing, make shale gas extraction a commercially viable. As demonstrated by the United States (US), countries with technically recoverable reserves are now considering the increase of their gas allocations in energy matrices due to the nascent accessibility of this feedstock. • In general, the hydraulic fracturing technology has high stakes; associated costs, risks, and benefits need to be properly analyzed in a framework that can enable elected officials and policy makers to make educated decisions that balance the needs of a nation’s economy and the environment. • Due to the nascent stage of the technology, especially in European countries, there is a lack of empirical evidence to support many of the assumptions surrounding shale gas; this uncertainty, coupled with environmental concerns, has created serious debate by various stakeholders and governments. • Key challenges are related to pricing regulations, cost and profitability, environmental and health concerns, and the management of water resources. • Key drivers are energy security and economic benefits (should shale gas be developed in an environmentally responsible manner). • The development of shale gas reserves in Europe could reverse the dwindling natural gas reserves, reduce dependence on imports, and restore the region’s status as an exporter. Source: Frost & Sullivan M932-39 5
  6. 6. Executive Summary (continued) • This research service analyses the impact of shale gas on the oilfield chemicals market. Moreover, it analyses the situation, developments, trends, and future opportunities in North America and Europe. • The total market revenue in North America and Europe is expected to grow from $5,371.6 million in 2012 to $8,621.3 million in 2019, at a compound annual growth rate (CAGR) of 7% between 2012 and 2019. • In 2012, hydraulic fracturing chemicals were the largest and the most dominant chemical group consumed in shale gas extraction and production. This group was far ahead of other chemicals, accounting for 37% of revenue generated by the total market of oilfield chemicals in shale gas production in North America and Europe. • The market share of hydraulic fracturing chemicals segment is expected to increase to 37.7% by 2019. • In 2012, the US was that largest consumer of a shale gas oilfield chemicals. Revenue generated by the region accounted for 75.5% of the total market of oilfield chemicals in shale gas revenue. Source: Frost & Sullivan M932-39 6
  7. 7. Executive Summary—Market Engineering Measurements Total Market of Oilfield Chemicals in Shale Gas: North America and Europe, 2012 Market Overview Market Stage Market Revenue $5,371.6 M Growth (2012) Base Year Market Growth Rate 5.6% Compound Annual Growth Rate 7.0% (CAGR: 2012–2019) Decreasing Stable Increasing Market Volume 6,689.5 Average Price per Tonne $803.0 $8,621.3 M (2012) (‘000 Metric Tonne) Customer Price Sensitivity 6 (2019) Degree of Technical Change 8 (scale: 1 [low] to 10 [High]) Market Size for Last Year of Study Period Market Concentration <72.0% (scale: 1 [low] to 10 [High]) (% of market share held by top 5 companies) For a tabular version click here. Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan M932-39 7
  8. 8. Executive Summary—Market Engineering Measurements (continued) Competitor Overview Number of Competitors >40 at supply level e <20 at service level (active market competitors in 2012) Number of Companies that Exited* 0 (2012) Number of Companies that Entered* 2 (2012) Industry Advancement Average Product Development Time 3–6 years Decreasing Stable Increasing Average R&D Spend by Product $1.4 M Marketing Spend as a percent of Market Revenue 10-15% *Companies with more than $60.0 M revenue. Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan M932-39 8
  9. 9. Executive Summary—CEO’s Perspective 1 The shale gas industry offers emerging growth opportunity, but it is initially abundant in supply and low in demand. 2 Shale gas is being acclaimed as a game changer in energy markets, such as North America, that have recoverable reserves. 3 An increase in natural gas production is expected to make it the preferred feedstock for chemicals and materials in the future. 4 The largest challenge to shale gas and oilfield chemicals is environmental sustainability. Source: Frost & Sullivan M932-39 9

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