ID: MRFR/E&P/6595-CR | 155 Pages | Published By Chitranshi Jaiswal on May 2021
Pipeline Integrity Market share is expected to surpass USD 10.6 Billion by 2027, with a 4.34% CAGR during the forecast period, 2022-2027.
The Pipeline Integrity Market will witness a CAGR of 4.34 % and a significant value in the forecast period by 2030.
The Pipeline Integrity Market is contributed due to the higher investment pool in the pipeline business. The rise in concern for the environment impacts the government’s policies and regulations for pipeline assessment, and the safety of pipelines and energy infrastructure is highly demanding for the market. The increased rate of focus on remote management of oil and gas pipelines for process automation is driving the market.
The huge amount of oil and gas transported through pipelines can increase risks due to hazardous materials. Therefore, pipeline integrity management plays a major role in managing it properly. A proper management process is highly necessary for assessing, evaluating, identifying, and mitigating the risks of pipelines.
The governments all over the country are implementing rules for the development of the pipeline integrity process. As the risks, threats, and damage can do maximum harm, the demand for the market worldwide is higher. The regulations for improving integration and analysis, data collection, and repair of the pipelines also drive the market. The rapid growth of urbanization and industrialization ensures greater energy demand, causing the usage and production of oil and gas. These factors are highly driving the Pipeline Integrity Market growth.
The prominent players operating in the global pipeline integrity market are ROSEN Group (Switzerland), Baker Hughes (US), NDT Global Gmbh & Co. Kg. (UAE), Emerson Electric Co. (US), Applus (Spain), Intertek Group Plc (UK), and EnerMech (UK), Schneider Electric (Japan), T.D WilliAMSON Inc (US), and Altus Intervention (Norway).
The global pipeline integrity market is expected to grow substantially during the forecast period owing to increased regulations and mandates for pipeline assessment. Moreover, big data analytics would increase the scope of the pipeline monitoring system, which is likely to create an opportunity for the players operating in the global market. However, cross-border pipelines are expected to restrain growth during the forecast period.
The global pipeline integrity marketis classifiedbased on service, product, applicationand region. By service, the global pipeline integrity market has been segmented into testing, monitoring, inspection, and software service.By product, the global pipeline integrity market has been segmented into oil, gas and refined product. By application, the global pipeline integrity market has been segmented into onshore and offshore.
The pipeline integrity market has been classified into five major regions, namely, North America, Europe, Asia-Pacific, the Middle East & Africa, and South America. The pipeline integrity market in North America is estimated to account forthe highest share of the pipeline integrity market. North America is one of the prominent regions in the world. The increasing per capita energy consumption,reduction in crude oil prices, increasing exploration and production of oil and gas, and concern over the environmental impact and safety of pipeline infrastructure are likely to drive the growth of the pipeline integrity market in the region. For instance, as per ICF International, approximately USD 333 billion investments are required between 2015 and 2035, including transmission pipelines, compressors, and gas storage.
Additionally, according to the BP Statistical Review of World Energy report, 2019, the primary energy consumption per capita of North America increased by 1.9% from 235.3 Gigajoules per capita (GJ/Capita) in 2017 to 239.8 GJ/Capita in 2018 of the regions. Furthermore, the oil production in the region increased by 12.1% from 20.16 million barrels per day (BPD) to 22.59 million BPD in 2018. Moreover, according to the US Energy Information Administration (EIA), in 2018, approximately 6.44 million BPD of crude oil was produced from tight oil resources in the US. Moreover, the development of strategic petroleum reserves and the increase in oil demand are expected to provide significant growth opportunities for the pipeline integrity market.
A pipeline integrity system refers to services provided in the midstream oil & gas industry sector, ensuring all the components of pipelines are operating properly in terms of reliability and efficiency. The management of pipeline integrity includes engineering, inspection, maintenance, and other aspects of oil & gas pipelines.
Pipelines transport the majority of primary energy that is used to supply power to vehicles, heat homes & workplaces, and provide feedstock for industrial processes and materials. These pipelines are constructed from steel and mostly buried underground. For instance, in the US, around 450 operators manage 180,000 miles of hazardous liquid pipelines, and about 1,000 operators manage 305,000 miles of natural gas transmission pipelines, for a total of nearly half a million miles. The tremendous amount of oil & gas being transported in these pipelines increases the probability of risks due to hazardous materials. To properly manage these pipelines, a proper integrity management process is required for identifying, assessing, evaluating, and mitigating the threats associated with pipelines.
Moreover, the government bodies of different countries are also amending the rules that require operators in order to develop integrity management programs for gas transmission pipelines where a leak or rupture could do the most harm. These regulations also require oil and gas pipeline operators to perform ongoing assessments of pipeline integrity. Moreover, regulations are needed to improve data collection, integration& analysis, and repair of the pipelines. Thus, increased regulations and mandates of pipeline assessment will drive the growth of the pipeline integrity market during the forecast period.
Urbanization and industrialization have increased the demand for energy, which eventually increases oil and gas consumption and production. Moreover, many oil & gas companies are focusing on increasing the E&P activities to meet the rising energy demand. This raises the demand for pipelines for the transportation of oil and gas. For instance, in September 2019, Subsea 7 (UK) signed a contract with Total (France) to developthe Lapa North East field located in São Paulo, Brazil,to transport and install pipelines. As per the report published by Global Energy Monitor (US) in 2019, the oil and gas companies in North America are planning to invest more than USD 1 trillion in the expansion of oil and gas infrastructure, of which approximately USD 232.5 billion, accounting for 23.25%, would be invested for the expansion of oil and gas pipeline projects. Furthermore, as per the World Pipelines Report, December 2018, the governments in Europe are planning to invest approximately USD 8.75 billion to constructthe Nord Stream gas pipeline for exporting gas from Russia to Germany under the Baltic Sea.
Hence, rising investments in pipeline infrastructure are expected to drive the growth of the global pipeline integrity market, which is an integral part of pipelines.
Geopolitical instability refers to disturbances due to the influence of various geographic and political factors, while geological challengesare the instabilityin the geology of a particular area or place, including drastic environmental changes. These are the major concerns for the oil & gas industry operators. Rapid urbanization, climatic changes, internal conflicts, and changes in oil prices, demand & supply risks, and political extremism are some of the factors that usually lead to the conditions of geopolitical and geological instability in countries. Such conditions play an important role in the growth of the pipeline integrity market as they help diversify pipeline supply routes, trading partners, and economic ties between the countries. Moreover, instability also results in cancellations, delays, interruptions, and financial loss in pipeline projects, which lead to projects being put onhold. For instance, in 2016, Saipem (Italy) filed an arbitration claim to Gazprom (Russia) worth approximately USD 823 million for the cancellation ofthe natural gas pipeline project in the black sea. Furthermore, political instability leads to delay in the construction of the oil & gas projects, which hampers the growth of the pipeline market. For instance, the Middle East to India Deepwater Pipeline project, which was proposed for enabling the supply of gas from Iran and Oman to India, got delayed due to various challenges such as political and technological challenges.
Moreover, cross-border pipelines are associated with disruption and generating conflict. Although most operating pipelines have not faced these problems, the risks in cross-border pipelines may increase the cost of finance. In addition to this, high financing cost impacts the delivered cost of the fuel.
The technological innovations and integration of digitalization technologies in the oil & gas industry have resulted in massive datasets in the oil & gas industry. This has created an opportunity for developing technologies for handling and processing these massive datasets, which are gathered and recorded in large volumes from various operations in the oil & gas industry. Big data analytics refers to analyzing and interpreting large amounts of data to gain better insight into improving operational efficiency, mitigating risks, cost optimization, safety, productivity, and real-time monitoring of flow stream in pipelines in the oil & gas industry. The information gathered from activities involved in the oil & gas industry is being utilized to gather data and information regarding leak detection and oil and gas flow rate. Moreover, many oil and gas companies are introducing Industry 4.0 architecture to enhance efficiency and increase productivity. Industry 4.0 architecture includes new industrial revolutionary technologies and processes, such as the Internet of Things (IoT), cloud computing, and artificial intelligence (AI), to gather and analyze data, which offers several advantages, including effective control, process automation, real-time access response, and data integration. These technologies offer better control and understanding of every aspect of the operations and provide data to help improve processes and boost productivity. Industry 4.0 enabled SCADA systems to enable better operations of collecting and managing data involved in the oil & gas industry.
Thus, the introduction of big data analytics to widen the scope for pipeline integrity systems creates a growth opportunity for the players operating in the global pipeline integration market during the forecast period.
The impact of COVID-19 on the worldwide economy is changing every day. The decline in revenue generation from the oil & gas industry has substantially impacted economies around the world. For instance, in May 2020, Subsea 7 announced that it is working on a cost reduction program, which aims to reduce its total headcount by one-fourth from its existing 12,000 employees by the second quarter of 2021. The company also announced that the company would be reducing its active fleets of 32 vessels to 10 vessels over the next 12 months. According to the market conditions, the company is expected to reshape its fleet over the next 12 months. Furthermore, the decline in oil prices is expected to incur approximately 30,000 job cuts from companies operating in the North Sea over the next 12 months. Moreover, cash inflow for many companies has declined due to the pandemic, and numerous companies have filed for bankruptcy in the past few months. For instance, in April 2020, Diamond Offshore Drilling filed for bankruptcy as it could not repay some financial obligations.
Low demand for oil and gas has also negatively impacted the pipeline industry, as many projects have been stalled across numerous countries. For instance, in May 2020, pipeline companies in the US announced that collectively they would be scaling back the construction of pipelines, which would have increased transportation capacity by 1.4 million barrels per day. Such factors are expected to have a substantial impact on the global pipeline integrity market. Additionally, companies operating in the global pipeline integrity market are expected to witness a severe financial crisis in the coming months.
COVID-19 has led to severe impact across all the industries around the world. The rapid spread has led governments across the globe to take stricter actions for the operations of industrial plants and offices, leading to stricter lockdowns. The prices associated with pipeline integrity services are expected to remain constant once the oil & gas industry stabilizes in the forthcoming months. The pandemic has disrupted the maintenance of oil and gas projects, leading to transportation and storage problems. Moreover, after the pandemic subsides and workers go back to work, the work is still not expectedto continue at the same intensity as the weather windows would have been missed, pushing the work to 2021-2022.
|Market Size||2030: Significant Value|
|CAGR||4.34% CAGR (2022-2030)|
|Historical Data||2019 & 2020|
|Forecast Units||Value (USD Million)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, and Trends|
|Segments Covered||Service, Application, Product|
|Geographies Covered||North America, Europe, Asia-Pacific, and Rest of the World (RoW)|
|Key Vendors||ROSEN Group (Switzerland), Baker Hughes (US), NDT Global Gmbh & Co. Kg. (UAE), Emerson Electric Co. (US), Applus+ (Spain), Intertek Group Plc (UK), and EnerMech (UK), Schneider Electric (Japan), T.D WilliAMSON Inc (US), and Altus Intervention (Norway).|
|Key Market Opportunities||strict government regulations for pipeline assessment and increase in focus on remote management of oil and gas pipelines for process optimization and automation|
|Key Market Drivers||
USD 2.14 Billion is the valuation of the market by 2024
2020 to 2027 is the growth period of the market
The global pipeline integrity market leading at a rapid pace because of strict government regulations for pipeline assessment and growth in focus on remote management of oil and gas pipelines for process optimization and automation.
4.34% is the CAGR of the market during the forecast period (2022 – 2030).
Baker Hughes, A GE Company (US), Rosen (Switzerland), Applus (Spain), Altus Intervention (Sweden), T.D. Williamson (US), Enermech (UK) are the key companies leading the market.