Raúl Baz
CEO
Grupo Petroquímico Beta
/
Insight

National Production of Fracturing Chemicals

Wed, 01/22/2014 - 11:09

As shale gas development in Mexico begins its evolution towards a production phase, a critical factor for the success of these activities will be the presence of reliable suppliers. One of the most vital links in this supply chain is the constant availability of chemical fracturing products. The chemical components of the water-based mixtures used in hydraulic fracturing are an essential part of shale gas and oil extraction activities. The expansion and stability of this subset of chemical producers and suppliers is particularly important to the sector, given the accelerated growth necessary to make shale projects profitable. The market for these chemical products already exists in Mexico given their cross-industry applications, but its size must increase if the future needs of the shale industry are to be met.

Larger chemical companies might naturally be thought able to fulfill this need as they already have a hand in this market. However, independent Mexican chemical producers also have an important role to play in this industry. There are numerous examples of shale development being better suited to small or mid-size suppliers that can provide the flexibility needed by operators. An interesting example of such business is Grupo Petroquímico Beta, a mid-sized Mexican chemical producer that has developed a product called carboxymethyl hydroxyethyl cellulose (CMHEC), which includes shale gas fracking among its numerous applications. 

Raúl Baz Harvill, CEO of Grupo Petroquímico Beta, explains the usage of this product in the shale extraction process. “This component is injected into the shale structure and, through a chemical reaction, becomes a very viscous solution allowing gas and other components to flow out of the well. We have developed our product based on ethylene oxide and cellulose, it substitutes one traditional product for the same purpose, namely ethoxylated guar gum.” This application of CMHEC is currently being certified by major oil service companies such as Baker Hughes and Halliburton. Another advantage provided by this product is the environmental and logistical benefit inherent to its manufacturing process, as outlined by Baz Harvill. “The environmental benefit is quite substantial in itself. The product that competes most closely with us, ethoxylated guar gum, is harvested exclusively in Pakistan and India, which presents several complications. For example, the cultivation areas were flooded two years ago and the price of guar gum shot up from US$3 to US$21 per kilogram, illustrating its overdependence on one specific area. We use cellulose to manufacture CMHEC, which is widely available everywhere. We are a more reliable supplier in terms of having a more stable cost structure.”

Baz Harvill asserts that Grupo Petroquímico Beta is “banking heavily on Mexico’s future as a shale gas producer to grow.” He is also focused on the possibilities offered by the international market, which he plans to tackle through partnerships such as that recently forged with German chemical giant HCS Group. As the Mexican market for CMHEC grows, Grupo Petroquímico Beta will be in a unique position to compare the development of the Mexican shale oil and gas industry with the development of other shale gas industries worldwide.