Market Insights
"The global composite frac plugs and frac balls market is estimated to grow at a healthy CAGR of 5.6% during the forecast period to reach a value of US$ 983.1 million in 2028."
Frac plugs and balls are components used in hydraulic fracturing (fracking) operations in the oil & gas industry. They are essential tools in the process of creating fractures in the subsurface rock formations to release hydrocarbons, such as oil and natural gas. A frac plug, short for "fracture plug," is a temporary downhole tool used in hydraulic fracturing. It is typically a cylindrical device made of materials designed to withstand high pressure and temperature conditions in the wellbore. A frac ball, or "fracture ball," is another component used in hydraulic fracturing operations. It is a spherical object typically made of materials that are easily broken down or dissolved under specific conditions.
Plug-n-perf is the most common technique and accounts for 85%+ of the global hydraulic fracturing market. Composite frac plugs and balls are advanced versions of the traditional frac plugs and balls used in hydraulic fracturing (fracking) operations in the oil & gas industry. The use of composite materials in frac plugs and balls has gained popularity due to their improved performance, reduced environmental impact, and cost savings. They offer advantages over traditional materials like metal alloys, as composites are engineered to meet the challenging downhole conditions while being more easily removed during well-cleanup operations. Composite frac plugs are known for their reliability, strength, and resistance to corrosive well fluids. Composites hold more than 70% share of the overall frac plugs and balls market in the industry. The composite frac plugs and balls market is highly dependent on hydraulic fracturing, the latter is highly subjected to the volatility of crude oil prices. The cash cost of producing a barrel of oil from hydraulic fracking from shale is about US$ 30 to US$ 50, whereas the cost of producing a barrel of oil from the conventional method in Saudi Arabia is about US$ 5 to US$ 10. Hydraulic fracturing becomes unviable for operators if the oil price is below US$ 40 per barrel.
Similar to hydraulic fracking, the composite frac plugs and balls market registered a severe downfall in 2015 and 2016, followed by a huge recovery in 2018, giving future hope to the composite frac plug and ball manufacturers. However, this hope did not last long and broke with a massive double-digit decline in 2019, owing to the weakened oil prices and increased capital discipline by major US operators, which slowed completion activity. In response to this, the oilfield service companies have cut costs, retired equipment, and improved efficiencies.
In 2020, the sudden outburst of the COVID-19 pandemic shook various industries. Almost all major industries recorded a massive decline in the year 2020 across regions due to lockdowns across nations, limited availability of raw materials, supply chain disruptions, and production halts. The hydraulic fracturing market was no exception and recorded a massive decline amid the pandemic. Composite frac plugs and balls, two essential parts, registered a decline of 33% (in terms of units) in 2020 amid the pandemic.
However, the market started rebounding with the rise in the price of crude oil and natural gas paired with the rising demand for oil & gas. In the long run, the composite frac plugs and balls market is estimated to grow at a healthy CAGR of 5.6% during the forecast period to reach a value of US$ 983.1 million in 2028. Composites frac plugs and balls provide an advantage of chemical inertness with any type of fluid, including oils, water, and natural gas. They also offer superior productivity, with less time required for mill out and low drill out as compared to metal frac plugs and balls. Furthermore, ongoing research & development efforts have led to the improvement of composite frac plugs and balls, making them more effective and cost-efficient and increasing their demand in the oil & gas industry. Also, stringent environmental regulations have pushed the industry to adopt more reliable and eco-friendly solutions, making composite frac plug and ball systems a preferred choice.
Recent Market JVs and Acquisitions:
Over the past five years, the industry has recorded a large number of mergers & acquisitions, keeping the numbers of players in mind. Some of the most noticeable ones are the following.
- In October 2019, Downhole Technology, LLC, and Resource Well Completion Technologies, Inc. merged. These combined businesses, wholly owned by Schoeller-Bleckmann Oilfield Equipment AG, will operate under the newly formed, The WellBoss Company.
- In 2018, Nine Energy Service, Inc. announced the acquisition of Magnum Oil Tools International, Ltd., a market-leading downhole technology provider serving the global oil & gas industry for over a decade. Magnum has a broad offering of proprietary downhole completion products, including dissolvable and composite frac plugs and several other patented consumables.
Segments Analysis
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Segmentations
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List of Sub-Segments
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Dominant and Fastest-Growing Segments
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Product-Type Analysis
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Frac Plugs and Frac Balls
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Frac plug is expected to remain the larger product category of the market during the forecast period.
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Resin- Type Analysis
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Epoxy, Phenolic, and Others
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Epoxy resin is likely to be the largest and fastest-growing material type in the market during the forecast period.
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Process- Type Analysis
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Compression Molding, Filament Winding, and Injection Molding
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Filament winding is expected to remain the dominant as well as the fastest-growing process type.
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Sales- Type Analysis
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Direct Sales and Distributor Sales
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Direct sales are holding the larger market share over the forecasted period.
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Regional Analysis
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North America, Europe, Asia-Pacific, and The Rest of the World
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North America is expected to remain the largest market over the next five years, whereas Asia-Pacific is likely to grow at the fastest rate.
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Product Trends
"Frac plug segment accounted for the largest market share."
Based on the product type, the composite frac plug & balls market is segmented into frac plugs and frac balls. Frac plug is anticipated to be the dominant product in the market during the forecast period. The dominance of frac plugs in hydraulic fracturing operations is due to their critical role in zonal isolation, controlled fracturing, and efficient well cleaning. Frac plugs are versatile tools that offer greater customization and adaptability to wellbore conditions, making them a more prominent product type in the industry. Composite frac plugs offer exceptional strength and durability, ensuring reliable zonal isolation during hydraulic fracturing operations. They are resistant to corrosion, which is crucial in the harsh downhole environment. Composite materials also provide a lightweight yet robust solution, reducing the risk of damage during installation. Additionally, composite frac plugs are cost-effective, with longer service life and reduced maintenance needs. As the oil & gas industry prioritizes efficiency, environmental compliance, and cost savings, composite frac plugs have emerged as the preferred choice, making them the dominant option in the market.
Resin Trends
"Epoxy resin segment accounted for the largest market share."
Based on the resin type, the market is segmented into epoxy, phenolic, and others. Epoxy resin is expected to be the dominant resin in the composite frac plugs & balls market during the forecast period. Epoxy resins offer several advantages when used in composite frac plugs. These include excellent mechanical properties, resistance, and interlaminar strength. Additionally, they have high tensile strength, good fatigue properties, and are compatible with both glass and carbon fibers. Epoxy resins also possess excellent adhesive properties and have a low shrinkage ratio.
Process Trends
"Filament winding segment accounted for the largest market share."
Based on the process type, the market is segmented into compression molding, filament winding, and injection molding. Filament winding is estimated to be the dominant as well as the fastest-growing process in the composite frac plugs and balls market. Frac plugs are mostly produced using the filament winding process, which is ideal for manufacturing medium-to-large-diameter parts with longer lengths. This process is best suited for structures with diameters ranging from 1 inch to 24 inches and lengths between 10 to 20 feet. Additionally, it is considered the optimal method for large-scale production runs. In addition to that, this process allows precise placement of reinforcing materials, such as fiberglass, in a controlled pattern, resulting in a composite structure with an exceptional strength-to-weight ratio. Filament winding ensures consistent quality, reducing the risk of defects. Moreover, it enables manufacturers to produce complex shapes with ease, meeting the varied design requirements of frac plugs and balls. As the oil & gas industry values reliability, durability, and cost-efficiency, the filament winding process delivers these benefits, securing a large market segment for composite frac plugs and balls.
Regional Insights
"North America accounted for the largest market share."
In terms of regions, North America is expected to be the largest region for the composites frac plugs & balls market. The market is primarily driven by the abundance of technically recoverable shale oil reserves, the well-established infrastructure of shale gas, and the processing capabilities in North America. Half of the country's crude oil is sourced from fracking. The Permian and Eagle Ford basins are the major regions for composite frac plugs and balls. Moreover, there has been an acceleration in the production of oil & gas composite components to cater to the huge demand from the growing shale gas exploration and production activities. Furthermore, the region boasts a mature and technologically advanced oil & gas industry, with well-established drilling and completion operations. This has created a substantial market for composite frac plugs and balls.
Kay Players
The market is highly consolidated with the presence of a handful number of regional and global players. Most of the major players compete on some of the governing factors including price, product offerings, regional presence, etc.
The following are the key players in the composite frac plugs & balls market.
- Halliburton Company
- Nine Energy Services Inc.
- Schlumberger NV
- NCS Multistage
- NexTier Oilfield Solutions
- KLX Energy Services Holdings
- Innovex Downhole Solutions Inc.
- Weatherford International plc
- Baker Hughes Company
- Downhole Technology LLC
Note: The above list does not necessarily include all the top players of the market.
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Research Methodology
This strategic assessment report from Stratview Research provides a comprehensive analysis that reflects today’s composite frac plug & balls market realities and future market possibilities for the forecast period. The report segments and analyzes the market in the most detailed manner to provide a panoramic view of the market. The vital data/information provided in the report can play a crucial role for market participants as well as investors in the identification of the low-hanging fruits available in the market as well as to formulate growth strategies to expedite their growth process.
This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools. More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data. We conducted more than 10 detailed primary interviews with market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.
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