|
Forecast
Period
|
2024-2028
|
|
Market
Size (2022)
|
USD
11.59 Billion
|
|
CAGR
(2023-2028)
|
4.17%
|
|
Fastest
Growing Segment
|
Downstream
|
|
Largest
Market
|
North
America
|
Market Overview
Global
Oil & Gas Industry Turbomachinery Market has valued at USD 11.59 Billion in
2022 and is anticipated to project robust growth in the forecast period with a
CAGR of 4.17% through 2028. Downstream sector is expected to dominate the
market in forecast period. The global refining sector is witnessing significant
growth in demand, on account of increasing demand for refined products from the
chemical and petrochemical industry. As a result, the demand for refined
products is expected to drive the growth of the turbomachinery market in the
forecast period.
Major
industries as a turbomachinery manufacturer are pumping high investments in
R&D of modern technology to reduce the start-up time, increase the
productivity at idle speeds and enhance the sensitivity to modification in
power demands for increasing the overall efficiency of the turbomachines. With
modern technologies, the turbomachinery market is expected to grow further
after the forecast period.
Key Market Drivers
LNG
(Liquefied Natural Gas) Demand
The
increasing demand for Liquefied Natural Gas (LNG) plays a pivotal role in
driving the Oil & Gas Industry Turbomachinery Market. LNG has emerged as a
cleaner and more versatile energy source, with applications ranging from power
generation to transportation fuel. This surge in LNG demand has far-reaching
implications for the entire oil and gas value chain, particularly in the
context of turbomachinery. First and foremost, LNG demand has spurred the
development of liquefaction plants and associated infrastructure. These
facilities require a wide array of turbomachinery, including compressors and
turbines, for processes like natural gas liquefaction and regasification. LNG
liquefaction plants are complex operations that require highly efficient and
reliable turbomachinery to cool and condense natural gas into its liquid form,
allowing for easier storage and transportation. Additionally, the
regasification of LNG at receiving terminals also relies heavily on
turbomachinery for converting it back into gaseous form before distribution.
Furthermore,
LNG's versatility has expanded its usage in the transportation sector,
particularly in heavy-duty trucks, ships, and even rail. LNG-powered engines
depend on turbomachinery for compression and expansion processes, making
turbomachinery a critical component of LNG refueling infrastructure. Moreover,
LNG is increasingly being adopted as a fuel for power generation due to its
lower emissions compared to coal and oil. Gas turbines, a type of
turbomachinery, are commonly used in LNG-based power plants, providing
efficient and flexible energy generation solutions.
The
global shift toward cleaner energy sources and the push for reduced greenhouse
gas emissions are further propelling LNG's popularity, thereby increasing the
demand for turbomachinery. As environmental regulations become more stringent,
companies in the oil and gas industry are investing in advanced turbomachinery
technology to optimize their LNG operations, reduce emissions, and improve
energy efficiency. In conclusion, the burgeoning demand for LNG is a key driver
of the Oil & Gas Industry Turbomachinery Market. This trend is expected to
persist as the world continues to embrace LNG as a cleaner and more sustainable
energy source, leading to ongoing investments in turbomachinery across the LNG
value chain, from production and liquefaction to transportation and power
generation. Turbomachinery manufacturers and service providers are poised to
benefit significantly from this growing demand for LNG.
Shale
Gas and Tight Oil Production
The
rapid expansion of shale gas and tight oil production is a major driving force
behind the growth of the Oil & Gas Industry Turbomachinery Market. Shale
gas and tight oil, extracted through hydraulic fracturing (fracking) and
horizontal drilling techniques, have transformed the global energy landscape
and created significant demand for specialized turbomachinery equipment. One of
the primary reasons for the surge in turbomachinery demand is the
unconventional nature of shale gas and tight oil reservoirs. These reservoirs
often require high-pressure hydraulic fracturing to release hydrocarbons
trapped within tight rock formations. Compressors and pumps are essential
components in the hydraulic fracturing process, pressurizing the fracking fluid
and driving it into the well to create fractures in the rock. The need for
reliable and efficient turbomachinery in this process has driven investments in
this sector.
Furthermore,
after extraction, shale gas and tight oil must be transported from remote
production sites to processing facilities and end-users. Natural gas and oil
pipelines, as well as compression stations, are crucial for efficient
transportation. Turbomachinery, including gas compressors, plays a pivotal role
in maintaining the pressure required to transport these hydrocarbons over long
distances, ensuring a steady supply to consumers. In addition to
transportation, shale gas and tight oil require processing before entering the
market. Gas processing plants and refineries rely on turbomachinery like
centrifugal and reciprocating compressors, as well as various pumps, to
separate impurities and refine the raw hydrocarbons into valuable products. The
complexity of these processes demands highly efficient and robust
turbomachinery solutions.
The
growth of shale gas and tight oil production has also led to increased
exploration and drilling activities, driving demand for drilling rigs and
associated turbomachinery such as mud pumps and drilling compressors. These
equipment is vital for drilling and maintaining wellbore integrity.
Furthermore,
shale gas and tight oil production is not limited to a single geographic
region. It has become a global phenomenon, with countries around the world
exploring and developing their unconventional resources. This global expansion
further fuels the demand for turbomachinery as these countries seek to
replicate the success of the shale revolution. In conclusion, the remarkable
growth in shale gas and tight oil production is a significant catalyst for the
Oil & Gas Industry Turbomachinery Market. The extraction, transportation,
processing, and drilling aspects of these unconventional resources rely heavily
on turbomachinery, making it a crucial factor in the industry's ongoing
expansion. As shale and tight oil production continues to evolve, the demand
for advanced and efficient turbomachinery solutions is expected to remain
strong.
Technological
Advancements
Technological
advancements play a pivotal role in driving the Oil & Gas Industry
Turbomachinery Market. As the oil and gas sector seeks to enhance efficiency,
reduce emissions, and improve operational reliability, turbomachinery
manufacturers and users are continually investing in cutting-edge technologies
to meet these goals.
One
of the most prominent areas of technological advancement is the development of
more efficient and reliable turbomachinery components. Advanced materials,
coatings, and manufacturing techniques have led to the creation of
high-performance compressors and turbine blades, rotors, and casings. These
innovations enable turbomachinery to operate at higher speeds and temperatures,
improving overall efficiency and reducing energy consumption. Enhanced
aerodynamics and improved sealing mechanisms further contribute to increased
efficiency, making turbomachinery an attractive choice for the industry. Furthermore,
digitalization and the adoption of Industry 4.0 principles have transformed the
oil and gas sector. Advanced sensors, data analytics, and predictive
maintenance algorithms are integrated into turbomachinery systems, enabling
real-time monitoring and diagnostics. This proactive approach minimizes
downtime, optimizes performance, and reduces maintenance costs. Data-driven
insights also help operators make informed decisions about equipment upgrades
and replacements.
In
addition to operational efficiency, environmental considerations are a driving
force for technological advancements in turbomachinery. The industry is under
increasing pressure to reduce greenhouse gas emissions. As a result, research
and development efforts are focused on designing turbomachinery systems that
are more environmentally friendly. This includes the development of
low-emission combustion technologies, carbon capture and storage (CCS)
solutions, and improved emissions control systems. Technological advancements
have also led to the miniaturization and modularization of turbomachinery
components, making them more adaptable to various applications and easier to
transport and install. This flexibility allows for quicker project
implementation and cost savings.
Moreover,
advancements in simulation and modeling software have enabled engineers to
design and optimize turbomachinery systems with greater precision.
Computational fluid dynamics (CFD) and finite element analysis (FEA) tools
assist in the development of efficient and reliable turbomachinery designs,
reducing the need for expensive physical prototypes and testing. In conclusion,
technological advancements are a driving force behind the Oil & Gas
Industry Turbomachinery Market's growth. These innovations lead to more
efficient, reliable, and environmentally friendly turbomachinery solutions. As
the industry continues to evolve, manufacturers and operators will continue to
leverage these technologies to meet the increasing demands for energy
efficiency and environmental sustainability.
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Key Market
Challenges
Market
Volatility
Market
volatility poses a significant and ongoing challenge to the Oil & Gas
Industry Turbomachinery Market. The oil and gas sector is renowned for its
cyclical nature, characterized by frequent and sometimes drastic fluctuations
in commodity prices, geopolitical tensions, and global economic conditions.
This inherent volatility has profound effects on the turbomachinery market,
affecting demand, investments, and strategic planning in several ways, Uncertainty
in Demand: Turbomachinery manufacturers often face uncertainty regarding the
demand for their products. When oil and gas prices are high, there is typically
increased exploration, production, and infrastructure development, leading to
greater demand for turbomachinery. Conversely, during periods of low prices,
capital expenditure in the industry tend to decrease, affecting new equipment
orders.
Delayed
Investment Decisions: Oil and gas companies often delay or cancel capital
expenditures during market downturns to conserve cash and mitigate financial
risks. These decisions can directly impact the turbomachinery market, leading
to postponed or canceled orders for new equipment. Budget Constraints:
Turbomachinery purchases are substantial investments, and their acquisition
often relies on capital budgets. Market volatility can strain these budgets,
leading to reduced spending on turbomachinery and other equipment. Project
Cancellations: Large-scale oil and gas projects, which often require
significant turbomachinery, are particularly vulnerable to market volatility.
Sudden price drops can lead to project cancellations or delays, directly
impacting turbomachinery orders.
Financial
Stability: Turbomachinery manufacturers and suppliers may face financial
challenges during market downturns when customer orders decrease. Maintaining
financial stability and cash flow can be challenging, and some companies may
struggle to weather extended periods of volatility. Capacity Utilization:
Turbomachinery manufacturing facilities and supply chains are designed to meet
demand during peak periods. When market conditions shift, manufacturers may
face issues with overcapacity, leading to inefficiencies and cost pressures. Competitive
Pressure: As demand fluctuates, companies within the turbomachinery market may
engage in price competition to secure orders. This can squeeze profit margins
and hinder long-term sustainability. Resource Allocation: Market volatility
necessitates flexible resource allocation and strategic planning.
Turbo-machinery manufacturers must balance the need for capacity with the risk
of underutilization during market downturns.
To
navigate the challenges posed by market volatility, companies in the
turbomachinery market must adopt proactive strategies. This includes
diversifying their product portfolios to serve a broader range of industries
and applications, implementing efficient inventory management practices, and
maintaining strong relationships with customers to better anticipate their
needs. Additionally, investments in research and development to create more
cost-effective and energy-efficient turbomachinery can enhance competitiveness
during market fluctuations. In conclusion, market volatility remains a
persistent and significant challenge for the Oil & Gas Industry
Turbomachinery Market. Companies in this sector must remain adaptable,
resilient, and innovative to thrive in an industry marked by frequent market
swings.
Environmental
Regulations
Environmental
regulations pose a substantial challenge to the Oil & Gas Industry
Turbomachinery Market. As governments worldwide intensify their efforts to
combat climate change and reduce greenhouse gas emissions, the oil and gas
sector faces increasingly stringent environmental requirements. These
regulations affect multiple aspects of the industry, including the development
and operation of turbomachinery equipment. Emissions Reduction Targets: Many
countries have committed to reducing carbon emissions to meet international
climate goals. As a result, oil and gas companies must implement cleaner technologies
and processes, including the adoption of low-emission turbomachinery solutions.
Achieving these targets often necessitates significant investments in research,
development, and innovation.
Methane
Emissions: Methane, a potent greenhouse gas, is frequently emitted during the
extraction, processing, and transportation of natural gas. To address this
issue, regulatory agencies are implementing rules to reduce methane emissions.
Turbomachinery used in natural gas production and processing must adhere to
these regulations, requiring advanced leak detection and control systems. Emissions
Monitoring and Reporting: Environmental agencies increasingly require
comprehensive monitoring and reporting of emissions from oil and gas
facilities. Turbomachinery operators must invest in monitoring technologies to
accurately measure and report emissions, adding complexity and cost to
operations.
Efficiency
Standards: Environmental regulations may also include efficiency standards that
turbomachinery must meet. This can necessitate the development of more
energy-efficient components, potentially increasing the cost of equipment. Waste
Management: Environmental regulations extend to waste management, requiring
proper disposal of hazardous materials and waste generated during the
manufacturing and maintenance of turbomachinery. Compliance with these
regulations adds to operational costs and complexity.
Carbon
Pricing: The implementation of carbon pricing mechanisms, such as carbon taxes
or cap-and-trade programs, can increase the cost of energy-intensive processes
in the oil and gas industry. Turbomachinery, as a significant consumer of
energy, may face additional financial burdens. Social and Public Pressure:
Beyond regulatory compliance, oil and gas companies face increasing pressure
from shareholders, consumers, and the public to adopt environmentally
responsible practices. This influences their decisions regarding turbomachinery
procurement and operations.
To
navigate these challenges, the turbomachinery industry must innovate and adapt.
This includes developing technologies that reduce emissions, improve energy
efficiency, and enhance environmental performance. Turbomachinery manufacturers
and operators should also engage in sustainable practices, such as
incorporating circular economy principles and exploring cleaner energy sources
like hydrogen. Collaboration with regulatory bodies and the adoption of best
practices for environmental compliance are essential in ensuring long-term
viability in a changing regulatory landscape. In conclusion, environmental
regulations represent a formidable challenge for the Oil & Gas Industry
Turbomachinery Market, requiring significant investments in technology,
emissions control, and sustainable practices to meet increasingly stringent environmental
standards.
Global
Supply Chain Disruptions
Global
supply chain disruptions have the potential to significantly hamper the Oil
& Gas Industry Turbomachinery Market. Turbomachinery, which includes
compressors, turbines, and other critical equipment, is essential for various
oil and gas operations, from extraction and processing to transportation and
power generation. When supply chain disruptions occur, they can disrupt the
timely delivery of these crucial components and have cascading effects on the
industry. Several factors contribute to the vulnerability of the turbomachinery
market to supply chain disruptions, Complex Supply Chains: The turbomachinery
industry relies on intricate global supply chains with multiple suppliers,
often spanning different countries and continents. This complexity increases
the risk of disruptions caused by factors like transportation bottlenecks,
trade disputes, or natural disasters.
Customization
and Lead Times: Turbomachinery equipment is often customized to meet specific
project requirements. This customization can lead to longer lead times, making
it more susceptible to delays and disruptions. When components or materials are
unavailable, it can cause project delays and cost overruns. Reliance on
Specialized Materials: Turbomachinery components often require specialized
materials with unique properties, such as high-temperature resistance and
corrosion resistance. Any disruption in the supply of these materials can
impact manufacturing processes and product availability.
Global
Events: Unforeseen global events, such as the COVID-19 pandemic, can disrupt
supply chains by causing factory closures, labor shortages, and transportation
challenges. These disruptions can lead to production delays and increased
costs. Geopolitical Factors: Trade tensions, tariffs, sanctions, and political
instability in key manufacturing regions can disrupt the flow of goods and
materials. Turbo-machinery manufacturers may face challenges sourcing critical
components from affected regions.
Transportation
Delays: Turbomachinery components are often oversized and require specialized
transportation methods. Transportation delays due to logistical issues, such as
port congestion or disruptions in shipping routes, can impact delivery
schedules. Quality Assurance: Turbomachinery components require stringent
quality control measures. Supply chain disruptions can lead to compromises in
quality assurance processes, potentially affecting the reliability and safety
of the equipment.
To
mitigate the impact of supply chain disruptions, companies in the
turbomachinery market may adopt strategies such as diversifying suppliers,
increasing inventory levels, and investing in digital supply chain management
tools for better visibility and agility. Collaboration with suppliers to
develop contingency plans and alternative sourcing options is also crucial. In
conclusion, supply chain disruptions pose a significant risk to the Oil &
Gas Industry Turbomachinery Market due to its reliance on complex and global
supply chains. Companies in the industry must proactively address these
challenges to ensure the consistent availability of critical equipment and to
minimize project delays and cost overruns.
Key Market Trends
Energy
Transition and Diversification
Energy
transition and diversification are powerful drivers propelling the Oil &
Gas Industry Turbomachinery Market into a new era. As the global focus shifts
toward more sustainable and environmentally friendly energy sources, the oil
and gas sector is undergoing a profound transformation, and turbomachinery
manufacturers are adapting to these changing dynamics. One of the primary
drivers of this transformation is the increasing urgency to address climate
change and reduce greenhouse gas emissions. Governments and organizations
worldwide are setting ambitious carbon reduction goals, and the oil and gas
industry is not immune to these pressures. As a result, the sector is expanding
its portfolio to include cleaner energy solutions, such as hydrogen production
and carbon capture and storage (CCS), alongside traditional hydrocarbon
operations.
Turbo
machinery, including compressors and turbines, plays a pivotal role in this
energy transition. Here's how, Hydrogen Production: Turbomachinery is essential
for hydrogen production, particularly in processes like steam methane reforming
(SMR) and electrolysis. As the demand for clean hydrogen grows, turbomachinery
manufacturers are developing specialized equipment to meet the needs of
hydrogen producers.
CCS:
Carbon capture and storage technologies are critical for reducing emissions
from existing fossil fuel operations. Turbomachinery is used in CCS processes
to compress, and transport captured carbon dioxide for storage underground,
helping to mitigate greenhouse gas emissions. Renewable Energy Integration:
Turbomachinery is increasingly integrated into renewable energy projects, such
as combined cycle power plants that pair gas turbines with wind or solar
generation. This hybrid approach enhances grid stability and ensures reliable
power supply.
Electrification:
The electrification of various oil and gas operations, including offshore
platforms and drilling rigs, requires electric-driven turbomachinery. This
trend promotes energy efficiency and reduces emissions. Decentralized Energy:
Turbomachinery providers are designing compact and modular systems suitable for
decentralized energy production, microgrids, and remote locations. These
solutions offer flexibility and reliability in diverse energy applications. Hybrid
Power Solutions: Turbomachinery is a key component in hybrid power systems that
combine renewable energy sources with traditional fuel sources. These solutions
optimize energy generation by using turbines to supplement intermittent
renewable sources.
Sustainability
Focus: Turbomachinery manufacturers are increasingly incorporating
sustainability principles into their operations, emphasizing energy efficiency,
recyclability, and reduced environmental impact in product design and
manufacturing. As the oil and gas industry embraces these changes,
turbomachinery manufacturers are well-positioned to play a vital role in
providing the technology and equipment needed for this energy transition. By
diversifying their product offerings, investing in research and development,
and collaborating with clean energy sectors, they can continue to thrive in a
changing energy landscape while contributing to a more sustainable future.
Energy transition and diversification are not only driving growth in the
Turbomachinery Market but also enabling the industry to align with global
sustainability goals.
Segmental Insights
Industry
Insights
The Downstream
Sector segment holds a significant market share in the Global Oil & Gas
Industry Turbomachinery Market. Downstream sector have dominated the oil &
gas industry turbomachinery market in recent years, and is expected to do the
same in forecast period.
Increasing
refined products demands in emerging markets, such as India, China, Brazil, and
Mexico, are expected to drive the oil & gas turbomachinery market in
downstream sector. Moreover, global demand for natural gas is expected to rise
because natural gas is more environment-friendly compared to other fossil
fuels, such as oil, and there is a global trend toward consumption of cleaner
fuel, owing to concerns about air pollution and global warming. Hence, the
share of the gas in total global energy consumption is expected to grow.
Beside this, the
growing population, urbanization, and industrialization in the developing
countries have resulted in increasing demand for refined and petrochemical
products. As a result, the focus of turbomachinery suppliers has shifted toward
countries like China and India.
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Regional Insights
North America plays a significant role
in the global Oil & Gas Industry Turbomachinery market,
The North American upstream industry is expected to grow at a faster rate due
to the positive outlook in the United States and Canada.
US crude oil production doubled between
2010 and 2018, with approximately 70% of that growth coming from the Gulf Coast
region. The United States Gulf Coast crude oil production grew from 5.2 million
bpd in 2014 to 7.1 million bpd in 2018, driven by production in the Permian
Basin in western Texas and Southeastern New Mexico.
Moreover, Canada presents tremendous
growth opportunity for the oil & gas turbomachinery market, as the major
oil reserves, like oil sand, are open to private companies and are not
controlled by national oil companies. Hence, growth in the United States and
private sector investments in Canada are expected to drive the upstream oil
& gas turbomachinery market in North America, during the forecast period.
Recent Developments
- India’s
investment in refining and petrochemicals industry is expected to pave a way
for the diaphragm pump market in India. Refining capacity of India grew to
22495.43 TMT in March 2019, an increase of 6.51% from March 2018. Refining
capacity of China is also on the rise, with a recent contract for 1 MTA
ethylene and refinery expansion project of Sinochem Quanzhou Petrochemical.
Key Market Players
- General Electric Company
- Siemens AG
- Sulzer Ltd
- Air Products & Chemicals, Inc.
- MAN SE
- Caterpillar Inc.
- Elliott Group Ltd.
- Atlas Copco AB Class A
- Kobe Steel Ltd
- Galileo Technologies S.A.
|
By Deployment
|
By Industry
|
By Type
|
By Region
|
|
|
|
- Gas & Steam Turbine
- Gas Compressor
- Pump
- Others
|
- North America
- Europe
- Latin America
- Middle East & Africa
- Asia Pacific
|
Report
Scope:
In
this report, the Global Oil & Gas Industry Turbomachinery Market has been
segmented into the following categories, in addition to the industry trends
which have also been detailed below:
- Global
Oil & Gas Industry Turbomachinery Market,
By Deployment:
o
Onshore
o
Offshore
- Global
Oil & Gas Industry Turbomachinery Market,
By Industry:
o
Upstream
o
Downstream
- Global
Oil & Gas Industry Turbomachinery Market,
By Type:
o
Gas
& Steam Turbine
o
Gas
Compressor
o
Pump
o
Others
- Global Oil & Gas Industry
Turbomachinery Market, By Region:
o North America
§ United States
§ Canada
§ Mexico
o Asia-Pacific
§ China
§ India
§ Japan
§ South Korea
§ Indonesia
o Europe
§ Germany
§ United Kingdom
§ France
§ Russia
§ Spain
o South America
§ Brazil
§ Argentina
o Middle East & Africa
§ Saudi Arabia
§ South Africa
§ Egypt
§ UAE
§ Israel
Competitive
Landscape
Company
Profiles: Detailed
analysis of the major companies presents in the Global Oil & Gas Industry
Turbomachinery Market.
Available
Customizations:
Global
Oil & Gas Industry Turbomachinery Market report with the given market data,
Tech Sci Research offers customizations according to a company's specific
needs. The following customization options are available for the report:
Company
Information
- Detailed analysis and profiling of
additional market players (up to five).
Global Oil & Gas
Industry Turbomachinery Market is an upcoming report to be released soon. If
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release, please contact us at [email protected]