US drilling may be booming, but demand for
bentonite drilling clay remains muted, as drillers continue to
favour oil-based muds, industry sources told
Bentonite is used in water-based drilling
fluids, or muds, but the clay is not necessary in synthetic
fluids containing hydrocarbons.
Drilling fluid is necessary in oil
exploration and extraction to lubricate and cool the drill bit,
as well as to maintain formation pressure, preventing a costly
So bentonite producers might have been
hoping for an increase in demand thanks to the recent uptick of
US drilling activity.
Last week the oilfield services company
Baker Hughes reported the number of active drilling rigs at
941, compared to just 438 a year ago. This increase comes
despite the fact that oil prices are still struggling to
concertedly break the $50 a barrel mark, which many in the
industry have identified as the break-even point for onshore US
But speaking to IM, a
source at a major oilfield services provider noted that the
increase in drilling has been extremely localised.
The increase has only been seen in onshore
US activity, with numbers outside the US remaining fairly
And even within the US, new drilling
activity is concentrated in the Permian basin, the oil-rich
region of West Texas.
Drillers in the Permian basin are reported
to prefer to use clay which is below API-grade, or oil-based
Oil-based mud is often preferred for shale
drilling, because it is less able to penetrate into shale
formations, and is less likely to cause collapses or blockages
of the formation.
Another source at an oilfield services
provider told IM that sales of bentonite had
remained stagnant, even as sales of barite, a heavy mineral
used as a weighting agent in drilling fluid,
One US bentonite producer noted that
bentonite prices had remained flat despite the uptick in
"Drilling is still a very minor use of
bentonite," he said. The swelling clay has a wide range of
other uses, from metal casting, to wine production, to kitty
"Drillers are using more oil-based muds,"
another US-based producer told IM. But he
noted that demand for bentonite from non-oil drillers, such as
pipeline drillers, was more active.
And he was optimistic that the move toward
oil-based drilling fluids might not be a permanent one.
"Oil-muds mean higher maintenance costs,"
he noted. "A lot of mud companies are saying that they want to
go back to clay."