In the last year, the US drilled 9,000 horizontal wells and pumped about 90 billion pounds of proppant. This year, we’re drilling just about 18,000 horizontal wells and pumping 250 billion pounds of proppant. How can it be that new well completions have doubled and proppants pumped almost tripled?

And it’s not stopping there; 2018 will climb another 90 billion pounds, as seen in this chart of proppant demand in the US:

I’ve stared and stared at this chart, and the numbers seem far too big to believe. I’ve checked and rechecked my math for the last two weeks -- including during a hike in the Julian Alps -- thinking that the rarified air would help expose the fallacies of my logic.  

I keep coming back to 250 billion pounds. Let me tell you why.

In the Bakken, operators have always drilled 10,000’ laterals. This has not changed since 2014. But in 2014, operators completed about 24 million feet of hole using about 400 pounds of proppant per foot of completed hole, which means they pumped about 10 billion pounds of proppant in 2014.  

In 2017, operators will complete far fewer feet – just 11 million – but they will pump about 1,500 pounds of proppant per foot of completed hole, or 16 billion pounds.  In the Bakken, they drilled half the wells and pumped 50% more proppant in 2017.

The main reason for the demand boost? Quadrupling the proppant intensity. Any why increase intensity? Operators are finding out that the more proppant they pump into the formation the larger the resulting fracture is, and thus they can access more of the reservoir and produce more oil or gas. Operators used to space Frac “stages” about 250-300 feet apart, but now they are closer (~200 ft apart) or are in “clusters” – all of which results in more proppant per foot of hole.

In every other basin, three variables have changed since 2014: number of feet of hole completed, pounds of proppant pumped per foot, AND length of the horizontal lateral.

The most dramatic change has happened in the Permian where all three variables have moved to the extreme: 2014 had 4,700 horizontal wells of 6,500’ laterals and 800 pounds of proppant per foot, creating demand for 25 billion pounds of proppant. 2017 will see 6,400 horizontal wells with 8,800’ laterals and 1,900 pounds of proppant per foot, or 95 billion pounds of proppant.  Wells grew by 50%, and proppant demand quadrupled.  

Back in the olden days of 1979, my very first frac job had two dump trucks, each with 40,000 pounds of sand, so an 80,000 pound frac job. That same amount of sand today would treat only 40 feet of completed hole… only one set of perforations.  

This justification is important because our forecast of proppant demand is far higher than everyone else’s forecast. But if ours is the right one, the only one taking account for the compounded growth, we could likely run into proppant shortages until capital can expand capacity again.