Drilling fluid additives are special materials that enhance the process of borehole drilling for oil, gas, and fresh water and are further useful in operations that include construction. Drilling fluid additives are used for different functions which make drilling process smooth & clean, keeping the borehole stabilized & open, cleaning the process at the bottom of the hole, and controlling the subsurface pressure. The global drilling fluid additives market covers different industries such as construction & infrastructure, manufacturing, and oil & gas.
Although there was some recovery after the COVID-19 impact in 2020, the Russia-Ukraine conflict is leading the global economy into recession in 2023 which will likely negatively impact drilling fluid additives sales in 2023.
Top Impacting Factors
Although the construction sector is facing a slowdown, which is affecting new drilling fluid additives sales, the drilling fluid additives market is expected to recover during the forecast period. One of the reasons for the growth is anticipated to be the rise in focus on shale gas development. Shale gas is the natural gas obtained from the shale deposits which is trapped in the microscopic level of pores or submicroscopic level of pores. Rise in demand for oil & gas in different countries such as India, South Africa, and China is expected to fuel the growth of the drilling fluid additives market. Further, rise in urbanization across the globe has increased the demand to build residential and transportational infrastructure. According to the United Nations, the global population is estimated to grow approximately by two billion in the next 30 years from 7.7 billion to 9.7 billion in 2050.
Factors such as discharge of toxic contaminants during the stone cuttings mixing with the groundwater makes the water toxic which becomes a barrier in the market growth. Secondly, the strict government regulations and carbon emissions are anticipated to restrain the market growth. Moreover, R&D strategies are expected to provide lucrative opportunities for players to increase their market share.
Technological advancement in the drilling activities is driving the market growth. Moreover, the focus on the depth of the borewell or borehole has increased, which requires high temperature and pressure conditions, stability, and other issues, hence requires a sophisticated drilling fluid system which helps in increasing the stability of wellbore, and improve the recovery ratio from reservoirs which is likely to improve the drilling operations; thereby, creating opportunities for the upsurge in the drilling fluid additives market during the forecast period.
Market Trends
New product launches to flourish in the market Improvement in the product range offered by the manufacturers increase the market competition. New advanced products help the customers to ease their work procedures and save time & extra miscellaneous costs. In April 2022, McDermid offshore solutions released water-based hydraulic fluid for offshore rigs. The applications of the water-based product are that it reduces wear and improvises the lubricity in motion comprehension devices and tensioning equipment for offshore drilling rigs. This is anticipated to improve the product portfolio of the company. Furthermore, Nanomalaysia, in November 2022, launched the patented revolutionary drilling fluid loss additives synergy 10AS Nano. This product has successfully passed the test which the company was carrying out from last four years in regards with the Malaysia’s 'National Energy Policy' which aims to reduce the carbon emission by improvising the energy efficiency.
The demand for drilling fluid additives decreased in the year 2020, owing to low demand from different industries due to imposition of lockdown by the government of many countries. The COVID-19 pandemic has shutdown production of various products for the drilling fluid additives sales channel, mainly owing to prolonged lockdowns in major global countries. This has hampered the growth of the drilling fluid additives market significantly during the pandemic. The major demand for the drilling fluid was previously noticed from giant manufacturing countries, including the U.S., Germany, Italy, the UK, and China, which were badly affected by the spread of coronavirus, thereby halting demand for chemical and material industry.
Segmental Overview
The drilling fluid additives market is segmented on the basis of type, formulation, sales channel, and region. By type, it is divided into surface modifiers, dispersant, corrosion inhibitors, biocides, defoamers, weighing agents, fluid loss control additives, and others. As per formulation, it is segmented into water-based fluids, oil-based fluids, synthetic-based fluids, and others. According to sales channel, it is divided into online (company-owned online channels, third party online channel), offline (retail outlets, specialty stores, hypermarket/supermarket, and others). On the basis of region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
By type: The segment includes all the types of drilling fluid offered by the manufacturers such as surface modifiers, dispersant, corrosion inhibitors, biocides, defoamers, weighing agents, fluid loss control additives and others. Companies such as Lubrizol, BASF SE, and Akzo Nobel N.V. provide a complete range of fluid additives.
By formulation: The water-based drilling fluid additives market is expected to grow rapidly during the forecast period. Water-based drilling fluid additives use water in the continuous phase and find a wide usage to maintain the change in viscosity, density, and regulate filtrate losses. Moreover, these are cost-effective with good chemical compatibility with rocks, and are preferred for curing mud losses.
By sales channel: The trend of online buying is biffing the offline system and customers prefer to order online to save time & money. This is attributed to the growth of the online sales channel segment.
By region: North America dominates the market share for drilling fluid additives as the key market players are established in the American region. The shale gas exploration within the region further plays a vital role in the market growth of North America.
Asia-Pacific has a significant market share in drilling fluid additives market, due to extensive demand in the construction & infrastructure in regards to oil & gas segment. The major players are striving to develop manufacturing units in these markets to improve production quantities as well as serve the Asian industries, including construction, oil & gas, and mining. Furthermore, according to the report published by the IMF organization, there was strong rebound of 6.5% in the Asian regional economy in 2021 and is projected to grow significantly by 4.3% in 2023. This influences the overall growth of construction and manufacturing facilities which further includes the drilling works in these regions. Thus, the improvement in overall production facilities is likely to create opportunities for the growth of the drilling fluid additives market in this region.
Major global players in the drilling fluid additives market are strengthening their businesses and offerings in Asian region, realizing the extensive growth opportunities for industrial growth. Moreover, China is one of the major exporters of drilling fluid additives globally. Rapid industrial development of China has motivated drilling fluid additives manufacturers to establish their production units in the country. The low labor and material costs in China help manufacturers produce drilling fluid additives at lower prices. The market in China further includes many small manufacturers who generally serve the Asian demand. Furthermore, manufacturing, energy, mining, and agriculture are some of the major industries in China. Hence, the development of these industries creates opportunities for the growth of drilling fluid additives in China.
Competitive Analysis:
Competitive analysis and profiles of the major players in the market, such as, Akzo Nobel N.V., Baroid Industrial Drilling Products, BASF SE, Chevron Phillips Chemical Company LLC, Croda International Plc, Flotek Industries, Inc., Halliburton, Lubrizol Corporation, Ltd., OMNOVA Solutions Inc., Prince Energy, Stepan Company, and The Dow Chemical Company are provided in this report. Major players have adopted technological advancement & product launch, acquisition, and business expansion as key developmental strategies to improve their product portfolio.
Acquisition and mergers:
Acquisition or merger helps the company to improve the product offering and adds more R&D facilities to the business. For Instance, in October 2019, Drilling Fluids Technologies Inc (DFT) acquired patented rights , Aphron Invasion Control System™ (AphronICS™) micro-bubble drilling fluid system from enventives, LLC. The acquisition includes a takeover of Aphrons ICS system with the patented rights. This will help drilling fluid technologies to expand its network of customers, add new members, and increase the sales & revenue of the company. This anticipates the growth of the drilling fluid additives market during the forecast period.
Business Expansions in the market:
In March 2022, Halliburton company announced the opening of the first chemical reaction plant in Saudi Arabia, to manufacture a wide range of chemicals required for the oil & gas value chain as well as the other industries. This extension of the company improvises its footprint in the eastern hemisphere and strengthens the serving ability in the Middle East region. Further, in August 2022, BASF announced the capacity expansion for the specialty chemicals, such as pyrrolidone which acts as a solvent and low foaming surfactant.
Although there was some recovery after the COVID-19 impact in 2020, the Russia-Ukraine conflict is leading the global economy into recession in 2023 which will likely negatively impact drilling fluid additives sales in 2023.
Top Impacting Factors
Although the construction sector is facing a slowdown, which is affecting new drilling fluid additives sales, the drilling fluid additives market is expected to recover during the forecast period. One of the reasons for the growth is anticipated to be the rise in focus on shale gas development. Shale gas is the natural gas obtained from the shale deposits which is trapped in the microscopic level of pores or submicroscopic level of pores. Rise in demand for oil & gas in different countries such as India, South Africa, and China is expected to fuel the growth of the drilling fluid additives market. Further, rise in urbanization across the globe has increased the demand to build residential and transportational infrastructure. According to the United Nations, the global population is estimated to grow approximately by two billion in the next 30 years from 7.7 billion to 9.7 billion in 2050.
Factors such as discharge of toxic contaminants during the stone cuttings mixing with the groundwater makes the water toxic which becomes a barrier in the market growth. Secondly, the strict government regulations and carbon emissions are anticipated to restrain the market growth. Moreover, R&D strategies are expected to provide lucrative opportunities for players to increase their market share.
Technological advancement in the drilling activities is driving the market growth. Moreover, the focus on the depth of the borewell or borehole has increased, which requires high temperature and pressure conditions, stability, and other issues, hence requires a sophisticated drilling fluid system which helps in increasing the stability of wellbore, and improve the recovery ratio from reservoirs which is likely to improve the drilling operations; thereby, creating opportunities for the upsurge in the drilling fluid additives market during the forecast period.
Market Trends
New product launches to flourish in the market Improvement in the product range offered by the manufacturers increase the market competition. New advanced products help the customers to ease their work procedures and save time & extra miscellaneous costs. In April 2022, McDermid offshore solutions released water-based hydraulic fluid for offshore rigs. The applications of the water-based product are that it reduces wear and improvises the lubricity in motion comprehension devices and tensioning equipment for offshore drilling rigs. This is anticipated to improve the product portfolio of the company. Furthermore, Nanomalaysia, in November 2022, launched the patented revolutionary drilling fluid loss additives synergy 10AS Nano. This product has successfully passed the test which the company was carrying out from last four years in regards with the Malaysia’s 'National Energy Policy' which aims to reduce the carbon emission by improvising the energy efficiency.
The demand for drilling fluid additives decreased in the year 2020, owing to low demand from different industries due to imposition of lockdown by the government of many countries. The COVID-19 pandemic has shutdown production of various products for the drilling fluid additives sales channel, mainly owing to prolonged lockdowns in major global countries. This has hampered the growth of the drilling fluid additives market significantly during the pandemic. The major demand for the drilling fluid was previously noticed from giant manufacturing countries, including the U.S., Germany, Italy, the UK, and China, which were badly affected by the spread of coronavirus, thereby halting demand for chemical and material industry.
Segmental Overview
The drilling fluid additives market is segmented on the basis of type, formulation, sales channel, and region. By type, it is divided into surface modifiers, dispersant, corrosion inhibitors, biocides, defoamers, weighing agents, fluid loss control additives, and others. As per formulation, it is segmented into water-based fluids, oil-based fluids, synthetic-based fluids, and others. According to sales channel, it is divided into online (company-owned online channels, third party online channel), offline (retail outlets, specialty stores, hypermarket/supermarket, and others). On the basis of region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
By type: The segment includes all the types of drilling fluid offered by the manufacturers such as surface modifiers, dispersant, corrosion inhibitors, biocides, defoamers, weighing agents, fluid loss control additives and others. Companies such as Lubrizol, BASF SE, and Akzo Nobel N.V. provide a complete range of fluid additives.
By formulation: The water-based drilling fluid additives market is expected to grow rapidly during the forecast period. Water-based drilling fluid additives use water in the continuous phase and find a wide usage to maintain the change in viscosity, density, and regulate filtrate losses. Moreover, these are cost-effective with good chemical compatibility with rocks, and are preferred for curing mud losses.
By sales channel: The trend of online buying is biffing the offline system and customers prefer to order online to save time & money. This is attributed to the growth of the online sales channel segment.
By region: North America dominates the market share for drilling fluid additives as the key market players are established in the American region. The shale gas exploration within the region further plays a vital role in the market growth of North America.
Asia-Pacific has a significant market share in drilling fluid additives market, due to extensive demand in the construction & infrastructure in regards to oil & gas segment. The major players are striving to develop manufacturing units in these markets to improve production quantities as well as serve the Asian industries, including construction, oil & gas, and mining. Furthermore, according to the report published by the IMF organization, there was strong rebound of 6.5% in the Asian regional economy in 2021 and is projected to grow significantly by 4.3% in 2023. This influences the overall growth of construction and manufacturing facilities which further includes the drilling works in these regions. Thus, the improvement in overall production facilities is likely to create opportunities for the growth of the drilling fluid additives market in this region.
Major global players in the drilling fluid additives market are strengthening their businesses and offerings in Asian region, realizing the extensive growth opportunities for industrial growth. Moreover, China is one of the major exporters of drilling fluid additives globally. Rapid industrial development of China has motivated drilling fluid additives manufacturers to establish their production units in the country. The low labor and material costs in China help manufacturers produce drilling fluid additives at lower prices. The market in China further includes many small manufacturers who generally serve the Asian demand. Furthermore, manufacturing, energy, mining, and agriculture are some of the major industries in China. Hence, the development of these industries creates opportunities for the growth of drilling fluid additives in China.
Competitive Analysis:
Competitive analysis and profiles of the major players in the market, such as, Akzo Nobel N.V., Baroid Industrial Drilling Products, BASF SE, Chevron Phillips Chemical Company LLC, Croda International Plc, Flotek Industries, Inc., Halliburton, Lubrizol Corporation, Ltd., OMNOVA Solutions Inc., Prince Energy, Stepan Company, and The Dow Chemical Company are provided in this report. Major players have adopted technological advancement & product launch, acquisition, and business expansion as key developmental strategies to improve their product portfolio.
Acquisition and mergers:
Acquisition or merger helps the company to improve the product offering and adds more R&D facilities to the business. For Instance, in October 2019, Drilling Fluids Technologies Inc (DFT) acquired patented rights , Aphron Invasion Control System™ (AphronICS™) micro-bubble drilling fluid system from enventives, LLC. The acquisition includes a takeover of Aphrons ICS system with the patented rights. This will help drilling fluid technologies to expand its network of customers, add new members, and increase the sales & revenue of the company. This anticipates the growth of the drilling fluid additives market during the forecast period.
Business Expansions in the market:
In March 2022, Halliburton company announced the opening of the first chemical reaction plant in Saudi Arabia, to manufacture a wide range of chemicals required for the oil & gas value chain as well as the other industries. This extension of the company improvises its footprint in the eastern hemisphere and strengthens the serving ability in the Middle East region. Further, in August 2022, BASF announced the capacity expansion for the specialty chemicals, such as pyrrolidone which acts as a solvent and low foaming surfactant.
Drilling Fluid Additives Market Report Highlights
| Aspects | Details |
 By Type |
|
 By Formulation |
|
 By Sales Channel |
|
 By Region |
|
 Key Market Players | Prince Energy, The Dow Chemical Company, Croda International Plc, Akzo Nobel N.V., Flotek Industries, Inc., BASF SE, OMNOVA Solutions Inc., Lubrizol Corporation, Ltd., Stepan Company, Chevron Phillips Chemical Company LLC |
Loading Table Of Content...
