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Oil & Gas Infrastructure

US demand to grow over 6% annually through 2016
US demand for midstream oil and gas infrastructure equipment is forecast to rise over seven percent annually through 2016, approaching $9 billion. Advances will benefit from the development of shale gas plays, especially in areas that have not until recently been major energy producers. These areas will require additional infrastructure in order to economically transport oil and natural gas from the well site. For example, pipeline capacity at the Bakken Shale in North Dakota and Montana is expected to more than double by 2016.

High oil prices to boost drilling activity in the short-term
Growth in the shorter term will benefit from high oil prices, which are boosting oil drilling. This will benefit infrastructure demand in areas such as the Eagle Ford play in Texas. Natural gas prices, while currently low, are expected to rebound by 2016. Expectations of this recovery are boosting demand for natural gas pipelines in areas such as the Marcellus Shale.

Steel to remain dominant, but plastic will grow faster
Pipe will continue to remain the largest product category in value terms, benefiting from construction of new main lines and the need for gathering systems at new drilling sites. Plastic pipe will register stronger gains than steel based on its widespread use in gathering applications. However, steel pipe will remain the dominant material based on its high pressure resistance. Welded pipe will continue to comprise the majority of steel pipe demand, due to its widespread use in transmission applications. Demand for pipeline flow control equipment such as valves, pumps and compressors will rise as a matter of course.

Eastern region to register strongest growth
The Eastern US will post the strongest gains of any region through 2016, benefitting from the need for infrastructure in the Marcellus play. However, the largest region for midstream infrastructure equipment is the Southern Region, which has the largest number of high output producing wells, the most drilling rigs, the largest number of well completions, and the highest levels of oil and natural gas production. In addition, offshore development in the Gulf of Mexico will create additional opportunities in the Southern Region.


PRESS RELEASE

US Demand for Oil and Gas Infrastructure Equipment to Exceed $12 Billion in 2016

Demand for oil and gas infrastructure equipment is forecast to rise 6.3 percent annually through 2016 to $12.1 billion. Advances will benefit from the development of shale plays, especially in areas that have not until recently been major energy producers. These areas will require additional infrastructure in order to economically transport oil and natural gas from the well site. For example, pipeline capacity at the Bakken Shale in North Dakota and Montana is expected to more than double by 2016. These and other trends are presented in Oil & Gas Infrastructure, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

Oil and gas infrastructure equipment demand will also benefit from increased upstream drilling activity. Much of this drilling activity is happening in previously dormant or nontraditional areas, which has created a demand for oil and gas infrastructure. Low natural gas prices have caused many producers to move drill rigs from dry gas areas into the more lucrative liquid plays. Strong liquid play activity is happening in the Eagle Ford Shale in Texas, the Bakken Shale in North Dakota, and the Niobrara Shale in Northern Colorado and Wyoming. However, natural gas prices, while currently low, are expected to recover by 2016. Expectations of this recovery are boosting demand for natural gas pipelines in areas such as the Marcellus Shale.

In addition to shale plays, significant pipeline opportunities will result from expansion of interstate pipelines. The most notable project is the Keystone XL pipeline, which would deliver crude oil from the Canadian tar sands to the southern US. The final portion of the project has yet to be approved by the US government, although such action is expected within the forecast period.

Demand for pipe will benefit from construction of new transmission lines and the need for gathering systems at new drilling sites. Plastic pipe will post faster gains than steel due to widespread use in gathering applications. However, steel pipe will remain the dominant material because of its high pressure resistance. Demand for equipment such as valves, pumps, and compressors will benefit from new and expanding pipelines, since this equipment is necessary to manage oil and gas flow through the system.

  • INTRODUCTION
  • EXECUTIVE SUMMARY
    • Table OIL & GAS INFRASTRUCTURE EQUIPMENT DEMAND (million dollars)
  • MARKET ENVIRONMENT
    • General
    • Macroeconomic Outlook
      • Table MACROECONOMIC INDICATORS (billion 2005 dollars)
    • Demographic Overview
      • Table POPULATION & HOUSEHOLDS (million persons)
    • Manufacturing Overview
      • Table MANUFACTURERS' SHIPMENTS
    • Electricity Generation
      • Table ELECTRICITY GENERATION BY FUEL SOURCE & PLANT TYPE (billion kilowatt hours)
    • Oil & Natural Gas Overview
      • Table OIL & NATURAL GAS SUPPLY & DEMAND
    • Oil Market Overview
      • Table CRUDE OIL & OTHER LIQUIDS SUPPLY & DEMAND (million barrels)
      • Production
      • Drilling
        • Table CRUDE OIL DRILLING INDICATORS
      • Pricing
    • Natural Gas Market Overview
      • Production
        • Table US NATURAL GAS SUPPLY & DEMAND (trillion cubic feet)
      • Drilling
        • Table NATURAL GAS DRILLING INDICATORS
      • Pricing
    • Unconventional Production
      • Shale
      • Tight Gas
      • Coalbed Methane
    • Midstream Sector Overview
    • Environmental & Regulatory Considerations
      • Drilling Regulation
      • Shale Regulation
      • Pipeline Regulation
    • International Activity & Foreign Trade
      • Table STEEL LINE PIPE FOREIGN TRADE (million dollars)
  • PRODUCTS
    • General
      • Table OIL & GAS INFRASTRUCTURE EQUIPMENT DEMAND BY TYPE (million dollars)
    • Pipe
      • Table PIPE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • By Material
        • Table PIPE DEMAND IN OIL & GAS INFRASTRUCTURE BY MATERIAL
        • Table STEEL PIPE DEMAND IN OIL & GAS INFRASTRUCTURE BY TYPE (million dollars)
        • Table WELDED PIPE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
        • Table SEAMLESS STEEL PIPE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
        • Table STEEL PIPE FITTINGS DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
        • Table PLASTIC PIPE DEMAND IN OIL & GAS INFRASTRUCTURE BY TYPE (million dollars)
      • By Diameter
        • Table OIL & GAS INFRASTRUCTURE PIPE DEMAND BY DIAMETER (million dollars)
    • Valves
      • Table VALVE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Automatic
        • Table AUTOMATIC VALVE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Conventional
        • Table CONVENTIONAL VALVE DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Compressors
      • Table COMPRESSOR DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Centrifugal
        • Table CENTRIFUGAL COMPRESSOR DEMAND IN GAS INFRASTRUCTURE (million dollars)
      • Reciprocating
        • Table RECIPROCATING COMPRESSOR DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Pumps
      • Table PUMP DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Centrifugal
        • Table CENTRIFUGAL PUMP DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Positive Displacement
        • Table POSITIVE DISPLACEMENT PUMP DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
      • Parts, Accessories, & Other Pumps
        • Table PARTS, ACCESSORIES, & OTHER PUMP DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Gas Processing Equipment
      • Table GAS PROCESSING EQUIPMENT DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Monitoring Equipment
      • Table MONITORING EQUIPMENT DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Storage Tanks
      • Table STORAGE TANK DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
    • Other
      • Table OTHER EQUIPMENT DEMAND IN OIL & GAS INFRASTRUCTURE (million dollars)
  • MARKETS
    • General
      • Table OIL & GAS INFRASTRUCTURE DEMAND BY MARKET & LOCATION (million dollars)
      • Oil
        • Table OIL INFRASTRUCTURE EQUIPMENT DEMAND (million dollars)
      • Natural Gas
        • Table NATURAL GAS INFRASTRUCTURE EQUIPMENT DEMAND (million dollars)
    • Locations
      • Onshore
        • Table ONSHORE OIL & GAS INFRASTRUCTURE DEMAND (million dollars)
      • Offshore
        • Table OFFSHORE OIL & GAS INFRASTRUCTURE DEMAND (million dollars)
  • REGIONS
    • General
      • Table OIL & GAS PRODUCING AREAS BY REGION
    • Producing Wells
      • Table PRODUCING OIL & GAS WELLS BY TYPE & REGION (thousand wells
    • Regional Drilling
      • Table WELLS DRILLED BY REGION
    • Regional Rig Counts
      • Table ACTIVE ROTARY RIGS BY REGION
    • Oil & Gas Infrastructure Demand by Region
      • Table OIL & GAS INFRASTRUCTURE DEMAND BY MARKET & REGION (million dollars)
      • Southern Region
        • Table SOUTHERN REGION: OIL & GAS INFRASTRUCTURE DEMAND (million dollars)
      • Midwestern Region
        • Table MIDWESTERN REGION: OIL & GAS INFRASTRUCTURE DEMAND (million dollars)
      • Eastern Region
        • Table EASTERN REGION: OIL & GAS INFRASTRUCTURE DEMAND
      • Western Region
        • Table WESTERN REGION: OIL & GAS INFRASTRUCTURE DEMAND
  • INDUSTRY STRUCTURE
    • General
      • Table US OIL & GAS INFRASTRUCTURE EQUIPMENT SALES BY COMPANY, 2011 (million dollars)
    • Market Share
    • Mergers & Acquisitions
      • Table SELECTED ACQUISITIONS & DIVESTITURES
    • Product Development & Manufacturing
    • Cooperative Agreements
      • Table SELECTED COOPERATIVE AGREEMENTS
    • Competitive Strategies
    • Company Profiles
      • ABB Limited
      • American Cast Iron Pipe Company
      • AMETEK Incorporated
      • Balon Corporation
      • Benxi Northern Steel Pipes Company Limited
      • Bonney Forge Corporation
      • Boomerang Tube LLC
      • Cameron International Corporation
      • Chevron Phillips Chemical Company LLC
      • CIRCOR International Incorporated
      • Crane Company
      • Dresser-Rand Group Incorporated
      • Dura-Line Holdings Incorporated
      • Ebara Corporation
      • Emerson Electric Company
      • EVRAZ plc
      • Flowserve Corporation
      • FMC Technologies Incorporated
      • Gardner Denver Incorporated
      • General Electric Company
      • Grupo Villacero SA de CV
      • Hyundai Hysco Company Limited
      • ITT Corporation
      • J-M Manufacturing Company Incorporated
      • JFE Holdings Incorporated
      • JMC Steel Group
      • John Wood Group plc
      • Liaoning Northern Steel Pipe Company Limited
      • Nagano Keiki Company Limited
      • National Oilwell Varco Incorporated
      • Northwest Pipe Company
      • OAO TMK
      • Paragon Industries Incorporated
      • Parker-Hannifin Corporation
      • PSL Limited
      • Schlumberger Limited
      • SeAH Steel Corporation
      • Siemens AG
      • SKF AB
      • SPX Corporation
      • Stupp Brothers Incorporated
      • Sulzer Limited
      • Tai Feng Qiao Metal Products Company Limited
      • Tenaris SA
      • Tianjin Lida Steel Pipe Group Company Limited
      • Tyco International Limited
      • United States Steel Corporation
      • United Technologies Corporation
      • Vallourec SA
      • voestalpine AG
      • Welspun Corporation Limited
      • WL Plastics Corporation
    • Other Companies Mentioned in Study

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