Drilling Fluids Additives Market Expected to Reach USD 1.97 Billion By 2027

bhagyashri shewale
Published on Jun 03, 2023

According to a new report by Reports and Data, the Drilling Fluids Additives market is projected to reach USD 1.97 Billion by 2027. The increasing demand for Drilling Fluids Additives can be attributed to the focus on developing new oilfields and restoring closed wells as a cost-effective alternative in the face of declining oil prices. Operators in the industry prioritize cost reduction and improved efficiency to maintain oil production rates. The UK Oil & Gas Authority (OGA) reports that out of 7,000 wells drilled on the UK continental shelf (UKCS), approximately 32.0% are active subsea wells, and 600 of the wells have been closed. In addition, well intervention operations led to the production of 22 million barrels of oil equivalent in 2017. However, subsea well intervention accounted for only 14.0% of operations in 2017, while platform wells accounted for 54.0%.

The global demand for energy is driving the growth of the Drilling Fluids Additives market. The US Energy Information Administration (EIA) predicts a 50.0% increase in global energy consumption between 2018 and 2050, with significant growth in non-OECD countries, particularly in the Asia Pacific region.

The COVID-19 pandemic has had a significant impact on the market. Lockdown measures imposed by nations worldwide resulted in a decline in oil demand, leading to reduced oil prices. Major oil and gas producers followed OPEC guidelines and cut production by 1.5 million barrels. This reduction in oil production has had a negative effect on exploration and drilling activities in the industry, consequently impacting the Drilling Fluids Additives market.

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Key findings from the report include:

  • Oil-based Drilling Fluids Additives dominated the market in 2019 due to its benefits such as lower well friction, especially in long-reach wells.
  • Offline distribution channels accounted for a larger market share in 2019, given the transparency and intensive nature of the industry.
  • Flocculants are expected to grow at a rate of 2.5% in the forecast period due to their applications in increasing viscosity and improving drilling efficiency.
  • North America held the largest market share in 2019 and is projected to grow at a rate of 1.9% due to the shale gas revolution and increasing energy demand.
  • Key participants in the market include Akzo Nobel, BAFF SE, Chevron Phillips, Innospec Inc., Dow Chemical, Tetra Technologies, Baroid Industrial Drilling Products, Omnova Solutions Inc., Lubrizol Corporation Ltd., and Croda International PLC.

For the purpose of the report, the Drilling Fluids Additives market is segmented based on type (water-based, oil-based, synthetic-based), distribution channel (online, offline), application (dispersants, flocculants, corrosion inhibitors, biocides, surface modifiers, defoamers, others), and region (North America, Europe, Asia Pacific, Latin America, Middle East, and Africa).

Drilling Fluids Additives Market: Drive factors

Factors Driving the Drilling Fluids Additives Market:

  1. Growing Emphasis on Oilfield Development: There is an increasing focus on the development of new oilfields and the restoration of closed wells. This is driven by the need for cost-effective alternatives in an environment of declining oil prices and profits. Operators aim to maintain oil production rates while reducing costs and improving efficiency, which drives the demand for drilling fluids additives.
  2. Surging Global Energy Demand: The rising demand for energy worldwide is a significant driver for the drilling fluids additives market. Projections by the US Energy Information Administration (EIA) indicate a substantial increase in global energy consumption, particularly in non-OECD countries. Robust economic growth, especially in the Asia Pacific region, is fueling the demand for energy, thereby driving the need for drilling fluids additives.
  3. Shale Gas Revolution: North America, in particular, has witnessed a shale gas revolution, leading to increased drilling activities and the demand for drilling fluids additives. The development of low-pressure oil wells and the growing demand for energy in the region contribute to the market's growth.
  4. Technological Advancements: Advancements in drilling technologies and techniques, such as extended-reach and deepwater drilling, require effective drilling fluids additives to ensure smooth drilling operations. As the industry continues to adopt advanced drilling methods, the demand for specialized additives increases.
  5. Environmental Regulations: Environmental regulations and concerns regarding drilling operations drive the need for environmentally friendly drilling fluids additives. Operators seek additives that comply with regulations, minimize environmental impact, and promote sustainable practices, thereby stimulating the market growth for eco-friendly additives.
  6. Well Intervention Operations: Well intervention activities, such as workovers and stimulation operations, contribute to the demand for drilling fluids additives. These operations aim to enhance oil production and revitalize aging wells. The use of additives in well intervention activities, such as corrosion inhibitors and surface modifiers, drives the market growth.
  7. Increasing Offshore Drilling Activities: Offshore drilling activities, particularly in regions with significant offshore oil and gas reserves, drive the demand for drilling fluids additives. The unique challenges of offshore drilling require specialized additives to maintain wellbore stability, control fluid loss, and mitigate formation damage.

These driving factors collectively contribute to the growth and expansion of the drilling fluids additives market.

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