World demand for well stimulation materials is projected to increase nearly 14 percent annually to $11.1 billion in 2015.  Overall, advances will be driven by relatively high oil prices that have spurred increased drilling activity and justified the additional costs associated with hydraulic fracturing and other well stimulation processes.  Among the four major national markets, Canada is expected to register the fastest growth due to its ongoing recovery from a sharp downturn in upstream oil and gas activity in recent years. These and other trends, including market share and product segmentation, are presented in World Well Stimulation Materials, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

The United States will remain by far the largest well stimulation materials market, accounting for nearly two-thirds of overall demand.  The US produced about 13 percent of the world’s oil and gas in 2010, but more than 45 percent of the oil and gas wells drilled in the world that year were in the US.  Oil drilling will continue to grow substantially after a sharp decline in 2009.  Gas drilling levels will be sustained by efforts to develop shale gas formations. 

Outside the US, shale gas offers considerable potential to boost demand for well stimulation materials.  Hydraulic fracturing, the most common stimulation technique, is considered indispensable to the process of producing shale oil and gas from deep shale formations.  While the US is further along in terms of shale gas development than elsewhere in the world, formations in Mexico, South America, Europe, Australia, Africa, China, and South Asia have generated tremendous interest on the part of large multinational producers, national energy companies, and smaller independent concerns. 

Proppants -- typically sand or ceramic material -- will continue to be the largest product category, accounting for nearly half of overall well stimulation material demand.  Proppant demand has been so strong in 2010 and the early months of 2011 that a number of suppliers have added capacity or are in the process of doing so.  Numerous sand proppant suppliers have also recently expanded capacity, and a number of new market entrants have begun to supply raw frac sand for use in well stimulation applications. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.