Market Trends of HIPPS Industry
This section covers the major market trends shaping the High Integrity Pressure Protection System Market according to our research experts:
Oil and Gas Segment Holds for a Major Share Throughout the Forecast period
- A high integrity pressure protection system is a safety instrumented system designed to protect oil and gas production, refining, and pipeline systems against over-pressurization. HIPPS leverages an oil and gas company's expertise in system design and integration.
- Players operating in the market are focusing on developing innovative products and solutions, which may bolster the growth of the HIPPS market in the coming years. In the recent past, ATV HIPPS delivered HIPPS to a major customer in the United Arab Emirates. ATV HIPPS is part of ATV Group and ATV SpA, a major player in Subsea and Topside critical service valves for the oil and gas industry. The company acquired Hydropneumatic, which is specialized in wellhead equipment and controls. This may leverage its enhanced technical portfolio of HIPPS solutions.
- The OCT SW development was driven by market feedback from offshore oil and gas operators concerning seawater service valves used for fire safety. The new solution ensures graphite parts, which can increase neighboring metals’ susceptibility to corrosion when exposed to seawater.
- Excessive wellhead pressure can cause serious consequences to downstream personnel, production and production assets, and the environment. It is, therefore, mandatory to have IEC 61511 compliant protection systems. Companies implement various strategies, but the most common are 1oo2 or 2oo3 architectures for compliance to SIL 2 or SIL 3.
- In the past, the Indian engineering major, Larsen & Toubro, supplied the country’s indigenously developed HIPPS to Dirok Gas Field Development Project in Assam. L&T Valves, a part of Larsen & Toubro, supplied indigenously developed HIPPS to Dirok, which is promoted by a consortium of Hindustan Oil Exploration Company, Oil India, and IOCL.
- HIPPS's demand further depends on sustainable development policies, which may deviate the industry application requirement further. In the sustainable development scenario, determined policy interventions may lead to a peak in the global oil demand within the next few years. The demand is estimated to fall by more than 50% in advanced economies and by 10% in developing economies between 2018 and 2040.
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Asia Pacific Segment Expected to Grow at a Significant Rate Over the Forecast Period
- The Asia Pacific HIPPS market is anticipated to witness the highest growth rate during the forecast period due to the region’s focus on developing oil and gas refining capacity and notable growth in the chemicals industry, with China, Japan India being some of the principal countries in this region. For instance, according to IEA, Asia continued to be the key destination for LNG, accounting for 70% of the total LNG imports by 2020.
- According to IEA, gas demand in the coming five years is set to be driven by Asia Pacific, and it is anticipated to account for almost 60% of the total consumption increase by 2024. In 2019, the requirement for gas in China surged sharply due to the expansion of the petroleum industry, improvement in living standards, and the development of gas infrastructure.
- Asia Pacific presents a tremendous potential for the installation of HIPPS in the oil and gas, chemicals, and power generation businesses. The burgeoning demand for petrochemicals in countries, such as China and India, is augmenting the production of oil, gas, and chemicals.
- For instance, according to the Ministry of Chemicals and Fertilizers, India, the annual growth of production during 2018-2019 was 4.70% over the preceding year, with a CAGR of 3.02% over a period of eight years, in case of major chemicals. The annual growth of basic major petrochemicals was 3.82% over preceding year, with a CAGR of 3.54% during the same period.
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