SCUP Report
Table of Contents
Abstract
About half of the worldwide oil field chemicals market continues to be accounted for by the highly mature fields in North America. This region has a very high percentage of its chemical use associated with gas fields. Increased production of tar sands in North America has resulted in increases in the volume of chemicals used and, based on the projected growth in this area, the volumes of chemicals consumed in the future will represent a significant portion of the market. Growth in Latin America, particularly in Brazil, has been significant although political instability has limited activity in Venezuela. Africa has seen significant growth across the continent and this is forecast to continue over the next five years. Although there are questions about political instability in some countries, such as Nigeria and Sudan, no single country dominates chemical usage in the region. In the Middle East, the two countries with the greatest growth potential are Iraq and Iran, where political factors have a major impact.
Many of the new fields present technological challenges, such as drilling in very deep water or working in high-temperature, high-pressure, and corrosive conditions. These wells require larger volumes of more expensive chemicals than most conventional wells. Thus, oil field chemical consumption will increase not only in volume but also in value as more expensive chemicals will be required in some cases.
Most of Western Europe's oil field production is in the North Sea, where the aging of wells has been accompanied by problems of corrosion and scale. In addition, European environmental concerns have led to restrictions or outright bans on many chemicals formerly employed, including alkylphenol formaldehyde resin–based demulsifiers and olefin-based synthetic fluids. Alternative products or techniques that are generally more expensive have now been substituted. Many of the major international oil companies, which have higher overhead costs, have divested older more mature fields to smaller operators who can operate the fields at lower cost.
The Asia Pacific market will show strong growth in the drilling, cementing and stimulation markets. Production chemicals will have a slower growth rate because much new development has involved gas fields. China remains a relatively closed market except for technologically difficult offshore fields.
While many service companies have a significant presence in the CIS (Commonwealth of Independent States), Schlumberger has based one of its five research centers in Moscow. Information on the markets in many of these countries is still somewhat sparse.
The global oil field chemical industry is dominated by large corporations that are also active in the wider range of oil field services such as exploration, drilling, design, and engineering. Halliburton Company is the largest cementing and stimulation service company and is also a major participant in drilling fluids. M-I SWACO, another major drilling fluids company, is jointly owned by Schlumberger and Smith Industries, both leading players in the oil field services sector; Schlumberger is also a major player in cementing/stimulation services. Baker Hughes is active in drilling chemicals through Baker Hughes Drilling Fluids and in production chemicals through Baker Petrolite.