Forecasting Fracking Fields: A Supply Chain of Chemicals

Hydraulic fracturing or “fracking” is a topic for hot debate in regards to safety and sound environmentalism. Nevertheless, the number of US fracking wells has seen a steady increase since 2002, as can be seen in Figure 1 [1].

Figure 1.

Figure 1 also shows the corresponding increase in “silica proppant” as the number of horizontal fracking wells increase. Silica proppant is a chemical injected at each wellhead to extract previously inaccessible oil and natural gas from the ground.

Therefore, the success of fracking wells largely depends on the accessibility and availability of silica proppant. Figure 2 shows a typical example of how silica proppant travels from a Minnesota mine to a Wyoming fracking site [2].

Figure 2.

Furthermore, ensuring each wellhead has an adequate amount of silica proppant is made more difficult due to the fact that this chemical mixture has a timed shelf life of when it is most effective. Otherwise, large holding tanks could be built at each wellhead and drawn from as needed. Due to the shelf life of the silica proppant, advanced forecasting can be used to ensure enough chemical mixture reaches each wellhead to cater to the demand for oil and natural gas. Some fracking drillers are taking advantage of the industrial internet of things (IIoT) and using sensors on holding tanks located at each wellhead to know exactly how much silica proppant is needed [3]. To improve forecasting even further, shipments of silica proppant destined for certain wellheads can be tracked via GPS to know precisely how much chemical will reach each well at what time. If this information is shared with the company supplying the silica proppant then the supplier can better prepare for future demand and scale up or cut back production as needed.

To be as successful as possible in the fracking industry requires up to date information within the supply chain. Forecasting can be introduced to increase success. 

[1 & 2] Mawet, Pierre J., Alex C. Fleming, and John H. Nichols. Eight Leading Practices for the Proppant Supply Chain. Rep. Accenture. < http://www.accenture.com/sitecollectiondocuments/pdf/accenture-eight-leading-practices-proppant-supply-chain.pdf/>.

[3] "Fracking And Chemicals Used In Drilling: A Supply Chain In Need Of Improvement." Forbes. Forbes Magazine. Web. 27 Oct. 2014. <http://www.forbes.com/sites/stevebanker/2014/09/26/fracking-and-the-chemicals-used-in-drilling-a-supply-chain-in-need-of-improvement/>.