Global proppants market is expected to witness significant demand growth in hydraulic fracturing as it helps keep fractures open and impart high permeability to unconventional plays. Large technically recoverable reserves in Asia Pacific coupled with increasing consumption of proppant per well is expected to act as a key market driver over the next six years. In addition, with the introduction of multi-stage fracturing resulting in increased number of fracturing stages, the consumption of proppants is expected to increase thereby accelerating demand over the forecast period.
Gaining popularity of ceramic proppant on account of excellent properties including high strength, conductivity, and crush resistance are expected to play an important role in driving proppant market over the projected period. Moreover, the increase in a number of horizontal wells in North America would result in higher demand for proppants per well which is expected to have a positive impact on market growth over the next six years. Stringent government regulations aimed at reducing hydraulic fracturing due to its hazardous environmental impact and ground water contamination could pose a challenge to market growth. In addition, high transportation cost of proppants is also expected to have a negative impact on the market growth. The development of ecofriendly non-phenolic resin coated proppants and improvement in hydraulic fracturing process in terms of increasing fracture flow capacity could be major growth opportunities over the next six years.
Sand was the largest product segment, accounting for over 75% of market volume in 2013. Low cost and high availability of sand as compared to other proppants are expected to help maintain market leadership over the forecast period. Ceramic proppants are expected to witness swift demand growth on account of growing consumption in impermeable shale plays as they impart high crush resistance, conductivity, and strength. Resin coated proppants are expected to witness high demand on account of a performance advantage over sand and cost advantage over ceramic proppants.
Proppants are used in hydraulic fracturing for various application segments including shale gas, tight gas, coal bed methane and others (LNG, shale oil, tight oil). Growing application scope of proppant in shale gas extraction owing to its use in power generation and transportation is expected to drive market growth over the forecast period. Moreover, large unexplored shale gas reserves in China, Australia, Argentina, Saudi Arabia, Algeria, and Brazil is expected to propel demand for proppant over the next six years. In addition, increasing use of ceramic proppant in shale plays owing to high EUR (estimated ultimate recovery) and permeability is further expected to drive market growth over the forecast period. High potential reserves of CBM in India and Australia are expected to augment demand for proppants in this application.
North America dominated the regional market of proppant and is expected to witness significant growth on account of increasing drilling and completion activities in U.S and Canada for shale plays. Proppant market in Asia Pacific is expected to witness demand growth owing to the presence of enormous shale gas reserves and hydraulic fracturing projects in China and Australia coupled with potential shale gas extraction projects in India. The government of China and India have announced plans to develop shale gas reserves as a part of their 12th five-year plans, which is expected to have a positive impact on market growth. The advent of shale gas and tight gas reserves in Saudi Arabia, Algeria, and Kuwait is expected to drive the proppant market in MENA over the forecast period. In addition, demand for ceramic proppant in Russia is expected to accelerate on account of growing hydraulic fracking activities primarily for unconventional oil.
Key players in the global proppants market include Carbo Ceramics, U.S. Silica, Fairmount Santrol, Hi-Crush LP Partners, Momentive, Saint-Gobain, Fores and Preferred Sands. Majority market players have increased production capacity in Asia Pacific due to application growth in the region. China Government shale gas policy “First Shale Gas Industrial Policy” intended for rapid promotion of shale gas industry is expected to open new market opportunities over the next six years.
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