Chemistry & Life Sciences

Enhanced Oil Recovery Chemicals Market Trends

EU, U.S. Promising Regions for Increased Use of EORs

04.10.2013 -


Maximizing Oil Fields' Output - Oil producers have resorted to innovative techniques to retrieve trapped oil from rock, sandstone and other formations. In most cases, stimulation techniques are used to recover oil in commercially viable quantities, and this is achieved by pumping in stimulation fluids along with various chemical additives.


The development and exploitation of an oil field typically consist of three stages: primary, secondary and tertiary recovery. In primary recovery, the oil is forced out by pressure generated from gas present in the oil. In secondary recovery, the reservoir is subjected to water flooding or gas injection to maintain a pressure that continues to move oil to the surface. In tertiary recovery, also known as Enhanced Oil Recovery (EOR), external fluids are introduced to reduce viscosity and improve overall flow and ultimately increase the recoverable reserves of oil.

Gases that are miscible with oil (typically carbon dioxide) are extensively used for EOR as well as steam, air or oxygen, polymer solutions, gels and chemicals, or microorganism formulations. Historically, the most common method is steam injection in the crude oil reservoir. Water injection has been used for many years. In general, gas injection is quite economical and is typically used when gas is part of the oil production. The gas is re-injected into the reservoir to maintain pressure. Alternatively, nitrogen is also used for EOR. It is produced from compressed air and membrane nitrogen generators, before being injected via high-pressure booster compressors.

Despite the recent popularity of gas injection, especially with CO2, which in 2012 was valued at 35% of EOR market share, chemical injection is also becoming an attractive method. This is mainly because of its proven effectiveness. In the same year, the chemical injection market share accounted for only 5% of the tertiary oil recovery, and the remaining 60% was thermal processes including steam stimulation and flooding. It is highly expected that chemicals injection market share will increase to 20% by 2019.

In general, the most beneficial attribute of chemical injection (or chemical flooding) is its ability to reduce the interfacial tension (IFT) between the crude oil and the injected water, allowing the oil to be produced. Moreover, various highly innovative chemical-based solutions are being developed and used - for example, micellar fluids, which are composed largely of chemically advanced surfactants mixed with water.

Normally, there are three chemical flooding processes including polymer flooding, surfactant-polymer (SP) flooding and alkaline-surfactant-polymer (ASP) flooding. In the polymer flooding method, which was the most popular in 2012 with 55.3% of the chemical-flooding market (fig.1), water-soluble polymers, usually polyacrylamides and biopolymers, such as xanthan, guar gum and cellulose polymers, are injected together with water to increase the viscosity of injected water. This leads to a more efficient displacement of moderately viscous oil. In the surfactant-polymer flooding method, under very specific circumstances, the oil-water IFT can be reduced to almost zero resulting in the displacement of trapped residual oil. In most cases the types of surfactants used in SP flooding were petroleum sulfonates and synthetic alkyl sulfonates, which usually require the use of co-surfactants (non-ionic surfactants) or co-solvents, mostly alcohols. In the alkaline-surfactant-polymer formulation, alkaline may convert some acids within the oil to surfactants that aid the oil recovery. The alkaline may also play a beneficial role in reducing surfactant retention in the rock. ASP formulations use moderate pH chemicals including sodium hydrogen carbonate (NaHCO3) or sodium carbonate (Na2CO3) rather than sodium hydroxide (NaOH) or sodium silicates (Na2SiO3).


Overview of the EOR Chemicals Market

The maturity of domestic oil fields supports the demand for EOR chemicals as oil companies aim at recovering the maximum quantities possible from their wells. In addition, the growth of EOR chemicals will be further influenced by energy conservation and policies, technology development and high fuel prices. Many chemical companies are focusing on researching and developing customized formulations offering a cheaper, faster and better EOR.

The U.S. and Europe are promising markets for the increased use of EOR chemicals. Despite the long presence in the market of EOR chemical solutions, the usage has not been as extensive as might be expected, especially when the size of the proven crude oil reserves and crude oil production (fig. 2) is considered. Moreover, many projects are still at their pilot stage. The major reason is that in most cases, advanced EOR techniques are highly demanding, challenging and expensive. Additionally, the profitability of EOR techniques depends directly on the crude oil prices and energy costs.

The pricing strategy of EOR chemical manufacturers takes into consideration the large volumes shipped. Therefore, it is not expected that EOR chemicals will experience a significant decrease in price until the economic conditions transform in order to justify a change in pricing strategy. In addition to the increase of raw chemicals costs, energy, warehousing and transport costs have a strong influence on EOR chemicals prices. Furthermore, many customers prefer value-added and multifunctional solutions that come with additional technical and after-sales support service.

In 2012, the EOR chemicals market in the U.S. and Europe was valued at $409.3 million with a high annual growth rate of 17.7%. When compared with 2009, where the EOR chemicals market generated revenues equal to $284.8 million, it is clear that the market experienced an explosive annual growth of almost 50%. The demand for EOR chemicals is expected to continue to grow during the forecast period up to 2018. The main reason is the anticipated continuous increase in oil prices and the systematic aging of oil-field resources. The main factor driving the market in the long term beyond 2018 is related to further technical advances as well as better understanding of EOR technology.


EOR Trends

There is a strong focus on the end-user market and further expansion on regions that have mature oil fields; as a result, it is crucial for chemical manufacturers to offer highly customized EOR chemicals or solutions. Chemical manufacturers that specialize in polymers, surfactants and formulations containing alkaline chemicals can benefit from this market growth by offering a broad range of chemicals at various concentrations. In addition, the service and oil companies require highly innovative technologies and equipment.

Key leading EOR chemical manufacturers, such as SNF Group, Tiorco, Kemira and BASF combined the most required properties to create highly effective EOR products. Strategic partnerships between key oil producers as well as EOR technology providers create better opportunities for EOR chemicals. Although investing in innovative, advanced and highly effective EOR chemicals and other chemical-based injection solutions is quite challenging, such investments are crucial for enhancing the overall crude oil extraction efficiency and thereby increasing oil production to meet the growing market needs, while maintaining high environmental, quality and health-care standards. In addition, there is a strong trend to employ bio-based chemicals, for example, biopolymers that are biodegradable, safe to humans and more environmentally friendly.


Growing Demand For EOR

The continuous increase in crude oil production dictated by high demand and depleting oil reservoirs is expected to maintain and further advance the need for various EOR technologies, including the chemicals injection method. The growing demand for a broad range of EOR chemicals such as polymers, surfactants, alkali chemicals and their formulations as well as advanced crude oil extraction technologies are helping to tap more oil from the rapidly maturing reserves that cannot be reached using traditional technology.



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