Overview of the global process plant equipment market in downstream oil and gas industry
Extensive research carried out by the analysts at Technavio has shown that the global process plant equipment market in downstream oil and gas industry will grow at a CAGR of more than 1% over the predicted period. Developing countries like India, China, and the Middle East are anticipated to have a large number of new refineries during the forecast period. China is expected to witness a high demand for refined products as well as petrochemicals, despite its economic slowdown since 2012. The Middle Eastern countries are attempting to reduce their dependency on imports by developing their downstream refining capability. The countries in this region are utilizing abundant crude oil supply to manufacture and export petrochemical products.
Greenhouse gasses (GHG) emissions from the transportation sector contribute a significant share in overall global emissions. As a result, developed markets like the US and Europe have enforced stricter emission regulations to reduce the content of sulfur and NOx in vehicular emissions. For instance, India, following the COP21 agreement, declared that it would skip standards similar to EURO V and adopt standards on the lines of EURO VI by 2020. The strict guideline state that refiners must upgrade their secondary processing equipment in the refineries to supply fuel in accordance with the current emission standards.
Competitive landscape and key vendors
The overall competition in this market is quite intense with the presence of multiple big players. The market is highly dominated by multinational companies that have vast experience in construction of not only refineries but also other critical areas like petrochemical units, upstream exploration units, gasification units, and LNG terminals. As a result, small or medium vendors are facing difficulties in entering the market as they lace up front investments. The process plant equipment in the refining industry is provided by EPC players in long-term contracts. The EPC vendors specialize in building refineries and upgrading the plants by attaching specific units for secondary processing. Recently, it has been observed that vendors are trying to renew their contract by collaborating with public companies. For instance, Fluor, a US-based firm and a leading EPC player in the refining industry, collaborated with Sacyr by selling 50% of its operations to increase its presence in Spain and Southern Europe.
Key vendors in the market are -
Other prominent vendors in the market are Bechtel, CB&I, Jacobs, KBR, Larsen & Toubro, NPCC, Petrofac, SK Engineering & Construction, Technicas Reunidas, and Worley Parsons.
Segmentation by type and the analysis of the process plant equipment market in downstream oil and gas industry
- Plant equipment
According to this market report, the plant equipment segment in the oil and gas industry dominated the market and is expected to grow at a CAGR of more than 1% by 2020. The plant equipment segment consists of pressure vessels, storage tanks, columns, crystallizers, heat exchangers, evaporators, and furnaces. This segment forms the core of any refinery and accounts for the largest share of equipment costs. The demand for such equipment will increase during the forecast period due to the rise in the number of complex refineries. While upgrading a plant, complex units like hydrocrackers and coking units are used, which have higher capital costs.
Geographical segmentation and analysis of the process plant equipment market in downstream oil and gas industry
In terms of geography, APAC led the process plant equipment market in downstream oil and gas industry and is expected to account for nearly 33% of the market’s revenue share by 2020. APAC has a high demand for refined petroleum products such as gasoline and diesel. This demand is primarily driven by countries like India and China, with steady GDP growth rate. These countries are also constructing refineries to avoid dependence on imports. India has low per capita consumption of petrochemicals and refined petrochemical products. As a result, most of the refined products are exported to Europe, the Middle East, and Asian countries. However, the country will increase its refining capacity from the rising growth of the construction, transportation, and manufacturing sectors.
Key questions answered in the report include
- What will the market size and the growth rate be in 2020?
- What are the key factors driving the global process plant equipment market in downstream oil and gas industry?
- What are the key market trends impacting the growth of the global process plant equipment market in downstream oil and gas industry?
- What are the challenges to market growth?
- Who are the key vendors in the global process plant equipment market in downstream oil and gas industry?
- What are the market opportunities and threats faced by the vendors in the global process plant equipment market in downstream oil and gas industry?
- Trending factors influencing the market shares of the Americas, APAC, Europe and MEA.
- What are the key outcomes of the five forces analysis of the global process plant equipment market in downstream oil and gas industry?