Market Trends of Onshore Oil and Gas Pipeline Industry
This section covers the major market trends shaping the Onshore Oil & Gas Pipeline Market according to our research experts:
Natural Gas Pipeline Type to Dominate the Market
- Natural gas consumption increased significantly, reaching 3822.8 billion cubic meters (bcm) in 2020, owing to the increasing demand for natural gas in multiple industries, including power generation and transportation. This consumption is expected to increase in the coming years and is likely to drive the gas pipeline infrastructure significantly.
- By 2030, owing to factors such as environmental benefits and the quest for energy security in regions such as Middle-East and Africa and Asia-Pacific, the demand for natural gas is expected to witness significant growth among all fuel types.
- Globally, the exports of natural gas through the pipeline were around 755.8 billion cubic meters in 2020. Also, as of 2020, Russia remained the largest gas exporter through the pipeline, with around 197.7 bcm of natural gas exported. Most of the pipelines used by Russia are of onshore nature, going through Belarus, Ukraine, and China. The LNG trade is expected to witness a significant increase globally, resulting in increased demand for the natural gas pipeline network as well.
- Moreover, in January 2020, the Indian government approved USD 774 million for an onshore natural gas pipeline network in the northeast region as part of a national gas grid being built to span remote locations in the country. The 1,656 km pipeline is expected to cost up to INR 92.65 billion and is expected to be completed by 2023.
- The development of new sources of natural gas, such as shale gas deposits, and the resulting price pressure is increasing the international trade of natural gas. Hence, these developments are expected to consequently result in increasing the demand for pipeline network expansion during the forecast period.
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Asia-Pacific Expected to Witness Significant Demand
- The energy consumption in Asia-Pacific is expected to increase by up to 48% by 2050. According to the International Energy Agency (IEA), China is expected to contribute 30% of the world's energy increase until 2025. Moreover, natural gas imports have been continuously rising in China and reached 138.371 bcm in 2020, thus, meeting the increasing domestic demand.
- China's state-owned firms, including CNPC and China National Offshore Oil Corporation, have plans to maximize production at local gas fields. This is expected to provide the need for the creation of onshore gas pipelines in the country, further driving the pipeline demand in the region.
- India is also modifying its gas pipeline infrastructure to meet the growing demand. In the annual budget for 2021, the Indian government announced a pipeline project for the union territory of Jammu and Kashmir. Apart from this, the nation aims to increase the natural gas share to 15% in the energy basket and expects USD 66 billion investment in building the gas infrastructure, including onshore gas pipeline, CGD, and LNG regasification terminals by 2030.
- Moreover, in December 2020, the Indian government announced a USD 60 billion investment for creating gas pipeline infrastructure, mostly onshore, which covers the expansion of Compressed Natural Gas pipeline networks (CGD) in 232 geographical areas across the country by 2024.
- Therefore, significant factors like the increasing demand for crude oil and natural gas along with new pipeline infrastructure in the Asia-Pacific region are expected to drive the global onshore oil and gas pipeline market growth.
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