Increased oil and gas recovery from shale formations in many parts of world will result in greater demand for hydraulic fracturing fluids and chemicals.

A new report from Research and Markets says that the fracking fluids market was worth $20 billion in 2015 and will reach $32.4 billion by 2020, growing at a compound annual rate of 10.1 percent over the forecast period.

With widespread drilling for unconventional reserves, particularly in the United States, North America is the global leader of the fracking fluids and chemicals market and is expected to remain so in the coming years. Demand is driven by the growth in hydraulic fracturing for shale oil and gas reserves, which consumes huge quantities of fracking fluids.

China and Indonesia also have significant shale gas reserves but fracking activity is currently low. Development of Asian unconventional shale reserves is projected to increase during the forecast period, resulting in increased demand for fracking fluids and chemicals.

Research and Markets also analyzed the fracking fluids and chemicals market by chemical function (acid, surfactant, biocide, gelling agent, crosslinker, breaker, scale & corrosion inhibitor, clay & iron control, and friction reducer). It found that gelling agents will represent the largest share at the end of the forecast period, accounting for 37 percent of the market in 2020.

In terms of fluid type, water-based fluids are most commonly used due to their various applications and cost effectiveness. However, growing environmental concerns are expected to increase demand for gelled oil-based fluids.

For the market to really flourish globally, water contamination from fracking fluid and chemicals, as well as other geological concerns, need to be addressed, the research firm concluded.