The global Production Chemical Market is Segmented By Type(Biocides, Emulsion Breakers, Scale Inhibitors, Corrosion Inhibitors, Scavengers, Surfactants, Antifoam Agents, Others), By Operation(Onshore, Offshore), By Application(Drilling, Cementing, Well Completion, Stimulation, Others), and By Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis, 2023-2020
The Global "Production Chemical Market" is estimated to reach at a high CAGR over the forecast period (2023-2030).
Production Chemical Market Scope
Metrics |
Details |
Market CAGR |
High |
Segments Covered |
By Type, By Operation, By Application, and By Region |
Report Insights Covered |
Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, and Other vital insights. |
Fastest Growing Region |
Asia Pacific |
Largest Market Share |
North America |
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Production chemicals are utilized for improving the recovery and production of the oil & gas from the well. Oil & gas companies use various production chemicals, including corrosion inhibitors, scale inhibitors, biocides, antifoam agents, scavengers, surfactants, etc. The oil & gas manufacturers are exploring new oil and gas sites to add to the existing production capacities. The production chemicals market is expected to boost companies looking to expand their oil & gas production and optimize their production operations with the most negligible environmental impacts. The increase in ultra-deepwater drilling projects will also be a vital factor in accelerating the growth of the production chemical market.
A poor understanding of chemicals in various operations increases the consumption to achieve the desired results. Therefore, reducing the number of chemicals is essential to minimizing the environmental impact of oil and gas production, as these chemicals can cause ecological harm. Hence, the companies focus on gaining more knowledge about appropriate production chemicals.
Source: DataM Intelligence Analysis (2023)
Production Chemical Market Dynamics and Trends
The growth of the global chemical market is driven by the growing oil & gas production.
Growing oil & gas production
At present, oil has become the leading source of energy globally. Its products underpin modern society, principally supplying energy to the heating homes, power industry, and fuel for vehicles and airplanes. Moreover, expanding exploration & production activities and increasing ultra-deep-water projects are expected to boost the demand for chemicals in the forecast period. According to the International Energy Agency report, in 2020, at the start of our forecast period, the oil demand was nearly nine mb/d below the level in 2019. Without policy intervention and behavioral changes, longer-term growth drivers will advance to ramp up oil demand. As a result, by 2026, oil consumption is forecasted to touch 104.1 mb/d globally. It would signify a gain of 4.4 mb/d from 2019 levels. With the rising oil demand, various companies are centering on ramping up their production. The need for chemicals has expanded dramatically, with companies looking to expand their oil production.
The companies are bringing proprietary technologies for product development, sensitivity studies, testing, and modeling operating scenarios to enhance oil & gas production in any environment. For instance, in 2017, Schlumberger announced the opening of a purpose-built Production Technologies Center of Excellence to solve customers' global challenges related to oil & gas production chemicals, particularly those encountered in deepwater, heavy oil, and other extreme environments. The center brings under the capabilities in chemical research, production chemicals formulation, and performance testing for our global operations.
Need for customized chemicals
The production chemicals necessitate being designed to be custom-made as per the production conditions. Similar applications may need different production chemicals involving other product specifications. Most Oilfield production chemicals are complex formulations of several different chemicals. The constituent chemicals are not pure chemical species but a mix of reaction products, reactants, and diluents.
The formulation ordinarily has one or two primary ingredients that provide the additive its main functionality. In addition, the formulation needs to be designed specifically for each oilfield. For each well and well within the oilfield, the recipe may differ depending on the time and the operating conditions. The scenarios mentioned above create problems for the chemical manufacturers and the oil & gas companies in optimizing their production process.
Covid-19 Impact on Production Chemical Market Growth
The oil & gas industry has encountered negative demand in the outbreak of Covid-19 due to the series of lockdowns, which severely affected end-use sectors. In 2020, Global oil consumption declined by approximately 9% as the pandemic reduced business, factory production, and transportation of goods. This abrupt drop accelerated an ongoing shift from fossil fuels to renewable energy. The lockdown has hampered the supply chain and operation. In addition, the import and exports were suspended, which fluctuated the prices of raw materials.
The industry players focus on reducing capital expenditure by postponing final investment decisions on new oil projects, which has impacted the chemical production market. For instance, ExxonMobil Corporation has decreased 30% capital expenditure on upstream operations. The covid has also resulted in a substantial decrease in oil prices, which reduced demand for oil because of lockdowns worldwide and impacted the need for production chemicals. World oil markets are rebalancing after the crisis spurred an unprecedented collapse in order in 2020. Still, according to industry experts, they may never return to normal.
Production Chemical Market Segment and Shares Analysis
By type, the production chemical market is segmented into biocides, emulsion breakers, scale inhibitors, corrosion inhibitors, scavengers, surfactants, antifoam agents, and others.
The need for restraining the growth of bacteria and other harmful organisms in the wellbore is boosting the sales of biocides.
The biocides chemical are expected to hold a significant production chemical market share. Biocides are widely used in the offshore oil & gas industry to maximize production by preserving assets by inhibiting microbial-induced biofilm and corrosion. The chemical is utilized to constrain the growth of bacteria and other harmful organisms in the wellbore. Protection of equipment and improved operational efficiency by controlling microbially induced corrosion is necessary, and biocides effectively treat bacterial metabolisms, such as scales, acids, slime, and poisonous gases. Biocides are also beneficial to protect the top structure from rusting. During the hydrostatic testing, the chemicals are recommended to limit the internal equipment from corrosion. The chemical should be used in small quantities while water is injected into the wellbore.
The companies are utilizing various strategies to expand their biocide chemical business. For instance, in 2021, Lanxess announced the acquisition of International Flavors & Fragrance's biocide business for about US$ 1.3 billion. Lanxess will now be a producer of glutaraldehyde, a biocide used in preservative applications such as paints and oil & gas drilling.
Source: DataM Intelligence Analysis (2023)
Production Chemical Market Geographical Analysis
The rapid expansion of oil & gas activities in the region boosts production chemical sales.
The Middle East & Africa region holds a significant market share for the oilfield stimulation chemical market globally. The anticipated growth is encouraged by the booming demand for oil fields and increasing expenditures in exploration and production activities in the Middle East. Countries such as UAE and Saudi Arabia, among others, are leading participants in developing the market in the region. For instance, Saudi Arabia possesses around 17% of the proven petroleum reserves globally. The oil % and gas sectors account for approximately 50% of the gross domestic product and 70% of export earnings.
The companies are looking to expand the production capacities in the oil fields due to immense need, which is anticipated to boost the oil field stimulation market in the region. For instance, in 2021, Halliburton Company won a contract to provide Production Chemicals and Associated Services for IOC in Oman. The company has been awarded a seven-year contract. Halliburton will supply a complete suite of customized products and specialized services to support the in-field chemical treatments. Halliburton will manufacture vital raw materials for the Halliburton Saudi Chemical Reaction Plant portfolio.
Source: DataM Intelligence Analysis (2023)
Production Chemical Companies and Competitive Landscape
The production chemical market is consolidated, with most of the production coming from global companies. The production of chemicals manufacturing is a complex task, which needs vast R&D and technologies to manufacture the chemical with accurate composition. Hence it becomes difficult for new companies to enter the market. Some of the key players contributing to the market's growth are Clariant AG, Evonik Industries, Rockwater Energy Solutions, AkzoNobel, BASF SE, Croda PLC, Schlumberger Limited, Solvay, Patriot Chemicals and Services, LLC, Halliburton, and others. The major players are adopting new strategies to dominate the market, such as launching new products, investing in R&D, acquisitions and collaborations, contributing to the growth of the chemical production market globally.
Clariant AG
Overview: Clariant AG is a specialty chemicals company, established in 1995 as a spin-off from Sandoz. The company is focused on three business areas: catalysis, care chemicals, natural resources, and plastics & coatings. Clariant Oil Services is a leader in developing, manufacturing, and supplying specialty chemicals and services to the oil & gas industry. The company will have a workforce of 13,000 by the end of 2020.
Product Portfolio: Clariant Refinery Services offers a wide range of production chemicals designed to meet the specifications in various streams and applications Our product offerings have an impressive reach extending from enhanced oil recovery, offshore and deepwater, conventional and unconventional oil & gas, heavy oil, and well services additives.
Critical Development: In 2018, Clariant announced the opening of its facilities based in Clinton, Oklahoma, today. The site is strategically located to support the growing oil and gas industry within the Mid-Continental region, focusing on the STACK and SCOOP.
Why Purchase the Report?
- Visualize the segmentation of the production chemical market by type, operation, application, and region, highlighting the critical commercial assets and players
- Identify commercial opportunities in chemical production by analyzing trends and co-development deals.
- Excel data sheet with thousands of data points of production chemical market-level 4/5 segmentation
- PDF report with the most relevant analysis cogently put together after exhaustive qualitative interviews and in-depth market study
- Product mapping in excel for the critical product of all major market players
The global production chemical market report would provide approximately 61 market data tables, 58 figures, and 190 pages.
Target Audience
- Oil & Gas Companies
- Chemical Manufacturers
- Industry Investors/Investment Bankers
- Transportation Companies
- Education & Research Institutes
- Research Professionals
