Fracking Fluid End Market by Material Type, by End-User Type, by Horsepower Type, by Design Type, and by Region, Size, Share, Growth, Trend, Forecast, Competitive Analysis, and Growth Opportunity: 2020-2025

Highlights

Fracking Fluid End, an Essential Component of Frac Pumps

Hydraulic fracturing, the technique used for the production of oil and natural gas, uses frac pumps to transmit the fracking fluid into the wellbore. Each frac fleet uses several frac pumps. Typically, 18-20 frac pumps are used per frac fleet. These pumps consist of two major components, the power end and the fluid end.

Responsible for the high-pressure injection of the fluid into the well, these fluid ends are not only an essential part of the frac pumps but are also an indispensable component of the pressure pumping market. The lifespan of a fluid end decreases with the use of recycled water, advanced chemicals & slickwater, and the quality of frac sand pumped through it. In general, the life of carbon steel fluid end is 250-450 hours, whereas stainless-steel fluid ends introduced in 2012 have a life three-to-four times that of carbon steel. Due to this fact, the fluid ends market offers attractive opportunities to the manufacturers despite it accounts for only ~30% of the total pump’s cost.

Covid-19, Price Wars, & Demand Slump - Shifting the Horizons for Fracking Fluid Ends Market

Since 2014, the oil & gas industry was not stable and the last two years have been difficult especially for the pressure pumping companies in North America due to the stagnant oil prices, shale drilling slump, and investor pressure discouraging new drilling. The year 2020 brought up two major setbacks for the oil & gas industry: the price war between Russia and Saudi Arabia and COVID-19. The disagreement between Russia and Saudi Arabia on the reduction of oil production resulted in more than 30% plunge in the oil prices to below US$ 30 per barrel. Despite the end of this price war with the unanimous agreement between OPEC and its allies to slash production, the oil prices have still not recovered to a profitable level. Further, the oil price collapsed with tepid oil demand due to the lockdown of more than two-thirds of the world population.

The decline in oil prices has a major impact on the American shale industry as fracking becomes unprofitable at oil prices less than US$ 40 per barrel. Many fracking companies, including Halliburton and Schlumberger, wrote off a large portion of their fleets due to the high number of pressure pumping supplies in the market, which led to demand and supply imbalances.

EIA estimated the average oil price will remain at US$ 33 per barrel in 2020 and expects a recovery to US$ 46 per barrel in 2021. Considering the expected oil price recovery along with the recovery from the COVID-19 pandemic, the author has projected that the global fracking fluid end market is likely to reach an estimated value of US$ 677.9 million in 2025.

Market Share Analysis

Share by Type of Material - Stainless Steel to remain dominant both in terms of Growth & Share

The author has firstly segmented the market based on the material type as carbon steel fluid end and stainless-steel fluid end. The stainless-steel fluid end is likely to maintain its dominance during the forecast period. Also, the segment is likely to grow at a higher rate in the wake of its corrosion-resistant property and more pumping hours as compared to carbon steel fluid end.

Share by User Segment - Fluid ends need replacement 3 to 4 times in a year, creating a good demand in the aftermarket.

Based on the end-user type, the market for fracking fluid ends is segmented as OE and aftermarket. The aftermarket not only governed the fracking fluid end market in 2019, but it is also estimated to be the faster-growing type in the coming five years. The lifespan of fluid ends getting shorter with the harsher fracking environment, a larger volume of proppant used, rising pumping pressure resulting in increasing replacement of fluid ends in existing frac pumps. While power end lasts for two years, fluid ends need to be replaced three to four times per year.

Share by Horsepower of Frac Pumps - Demand shifting towards pumps having horsepower above 2,500

Based on the horsepower of frac pumps, the market is broadly segmented as 2000-2500 horsepower and above 2500 horsepower. In 2019, fluid ends compatible with frac pumps of horsepower between 2000-2500 held a major share of the market. The above 2500 horsepower segment is expected to grow at a higher rate during the forecast period, driven by the gradual shift in demand towards higher horsepower pumps in order to reduce the number of assets on the site while extending the parts life. For example, 11 units of 5,000 HP fracking pumps can do the job of 20 units of 2,500 HP frac pumps.

Regional Share - North America to remain dominant

In terms of region, North America is projected to remain the largest market during the forecast period primarily because of the presence of high technically recoverable reserves of shale oil and gas and the presence of major fluid end manufacturers in the region. In 2019, the demand for fluid ends in the region was disrupted principally because of the focus of operators for capital discipline over growth. Despite an increase in oil prices in 2019 (WTI oil price increased from $48 to $62 with an average of $57), the land rig count in North America shrunk by 27%. E&P operators in the region started shifting their focus towards cash generation over growth, which led to an accelerated downturn in the second half of the market. The COVID-19 outbreak disrupted the supply-demand dynamics with significant lesser oil demand may reduce exploration and production expenditure in 2020.

Key Players

The supply chain of this market comprises raw material suppliers, fluid end manufacturers, pump manufacturers, and services companies.

Some of the key fluid end manufacturers are:

• Dragon Products Ltd.
• Forum Energy Technologies Inc.
• Gardener Denver Inc.
• Halliburton Company
• Kerr Pumps
• ST9 Gas + Oil
• TechnipFMC plc
• The Weir Group PLC
• VP Sales & Manufacturing
• VULCAN Industrial Holdings

Some of the key mergers & acquisitions and strategic alliances in the market:

• In 2017, FMC Technologies, Inc. and Technip S.A. merged and formed TechnipFMC plc. The merger led to the formation of the world’s largest offshore energy services company.
• In 2016, The Weir Group PLC partnered with Canyon Services Group of Canada for the deployment of Weir’s SPM QEM 3000 frac pumps at its production site in Western Canada’s Duvernay and Montney formations. This marked the entry of the first continuous duty frac pump in the Canadian market.
• In 2015, Forum Energy Technologies, Inc. acquired J-Mac Tool, Inc., the manufacturer of hydraulic fracturing pumps, power ends, fluid ends, and other pump accessories. The acquisition made the company to expand its product portfolio in the pressure pumping market.

Some of the new product launches in the market:

• In 2018, Kerr Pumps launched Frac One Connect - F1X, a fluid end made from Super Stainless II material. The fluid end made from the strongest stainless-steel has been manufactured at just US$ 49, 995; contrary to the available fluid end at US$ 62,000.
• In 2018, Gardener Denver, Inc. launched GDNX - the next-generation fluid end technology. The stainless steel-made fluid end was designed to increase the operational service life of fluid ends used in various applications such as hydraulic fracturing and coil tubing. The fluid end is developed in a way that it lasts 3.5 times more as compared to the other fluid ends available in the market.
• In 2018, ST9 Gas + Oil released its XGen fluid end for frac and well service pumps. The company developed this product in order to address fatigue and washout problems seen in the competitors’ fluid end.

Report Features

This report provides market intelligence in the most comprehensive way. The report structure has been kept such that it offers maximum business value. It provides critical insights into the market dynamics and will enable strategic decision making for the existing market players as well as those willing to enter the market. The following are the key features of the report:

• Market structure: Overview, industry life cycle analysis, supply chain analysis
• Market environment analysis: Growth drivers and constraints, Porter’s five forces analysis, SWOT analysis
• Market forecast analysis
• Market segment forecast
• Competitive landscape and dynamics: Market share, product portfolio, product launches, etc.
• Attractive market segments and associated growth opportunities
• Emerging trends
• Strategic growth opportunities for the existing and new players
• Key success factors

Market Segmentation

The market is segmented into the following categories:

Fracking Fluid End Market, By Material Type

• Carbon Steel Fluid End (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Stainless-Steel Fluid End (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)

Fracking Fluid End Market, By End-User Type

• OE (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Aftermarket (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)

Fracking Fluid End Market, By Horsepower Type

• 2000-2500 HP (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Above 2500 HP (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)

Fracking Fluid End Market, By Design Type

• Triplex (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Quintuplex (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)

Fracking Fluid End Market, By Region

• North America (Country Analysis: The USA and Canada)
• Europe (Country Analysis: Russia, Norway, and Rest of Europe)
• Asia-Pacific (Country Analysis: China, Australia, and Rest of Asia-Pacific)
• Rest of the World (Sub-Region Analysis: Latin America, The Middle East, and Others)