A dive into the chemistries of fracking & the market's rise
In 2014, BCC Research revealed in a report that the North American market for wastewater treatment equipment for hydraulically fractured gas and oil wells was expected to grow to $350 million by 2018; it ended up surpassing that prediction. The U.S. hydraulic fracturing market is projected to reach $13.91 billion by 2025, according to a report by Business Wire. This growth reflects an expansion in the demand for primary energy resources due to the rise in population and industrialization.
By definition, fracking is a process that forces fluids through the ground at high pressures to create small fractures in rock formations that release oil and/or gas for collection. With the industry growing frequently, an increased demand for more raw materials is ever-present.
Chemistry is an important aspect of fracking. Technavio reported in March 2017 that the global fracking fluid and chemicals market is expected to exceed $35 billion by 2021. The three drivers contributing to this growth include the shift toward horizontal drilling, increased consumption of oil and gas, and the growth of the shale and gas markets. According to Business Wire, water-based fluids accounted for 66% of the market share in 2016.
With oil and gas exploration on the rise in the U.S., horizontal drilling needs more fracking chemicals and fluids as it covers more surface area than other types of drilling.
“The global fracking fluid and chemicals market is expected to grown significantly due to the increased acceptance of advances drilling technologies such as horizontal drilling recovering oil and gas,” said Mahitha Mallishetty, a lead analyst at Technavio for specialty chemicals research, in a Technavio report.
MFG Chemical is a company that supplies the different chemistries used in fracking.
“A lot of the chemistries that we work with are the monomers to polymerize and make different types of polymers that would go into water treatment. A lot of those are scale inhibitors, corrosion inhibitors, things of that nature,” said Keith Arnold, CEO of MFG Chemical.
Although MFG Chemical is not directly involved in fracking, it considers itself more of a supplier in the process rather than working in the field directly.
“I guess it’s kind of a doorway. Sometimes, we go work with our customers and sometimes they’re in different areas of water treatment that we are supporting,” Arnold said. “I know we’re in that space but we’re into it indirectly just because of our channel to market. It’s nice because we know our channels to market and it is through large chemical company service providers. That’s why we’re a little cautious. We don’t want them to perceive that we’re trying to do an end-around and ever compete with them.”
Lately, there has been more pressure to reduce the amount of freshwater used in the process. Some businesses have even started using recycled water in fracking. According to Scientific American, slightly dirty water can do just as good as a job as clean water when it comes to the process. Oilfield companies such as Halliburton and FTS Intl. are treating water from fracked wells just enough so it can be used again. In the past, companies considered recycled water too expensive and worried using anything other than freshwater would not reduce well output.
Arnold thinks this makes sense with how the industry has evolved over time.
“All of that comes down to a lot of sustainability. Reduction of processing chemicals. It just makes a lot of sense. Our industry in the past five, 10 years has come a long ways to water reuse,” Arnold said.
In the past decade, the technology advancement in the fracking industry also has helped the industry in a huge way.
Fracking is not a new development. In fact it was a well known method in earlier decades, according to Black Mountain Sand. However, the method was disregarded for not being economically feasible at the time. Now, with major advances in horizontal drilling, the industry continues to advance.
“It continues to evolve. It’s amazing the engineering and science that goes behind fracking, if you look at where it was almost nonexistent 20 years ago,” Arnold said. “So it’s companies, they really see the return on investment and continue to drive it. That’s why the U.S. is in such a dominant position worldwide because of what will be done and accomplished in fracking.”
Arnold said it is striking how in different parts of the country and the world, frackers have to customize their chemistries to get the best functionality. Even if it is only 10 miles away, Arnold said they have to change the characteristics, the molecular weights and even the composition of the chemistries and formulations.
“There is a lot of other water treatment areas that have a lot of technology that moves over into fracking, and it can be used as much as water clarification and purification and in areas of that nature. There’s a lot of, as I call it, cross-pollination of some of these chemistries,” Arnold said.
The industry continues to expand as the market becomes even bigger.
“Fracking continues to remain strong and growing, and that is why MFG Chemical is committed to manufacturing in the Houston area to support our customers with the expertise for this sector of oilfield.”