North America, Asia to drive growth, pipeline CAPEX to 2019

Onshore pipeline expenditure is forecast to grow by 14 per cent between 2015 and 2019, with approximately 309,000 km of pipeline expected to be installed globally, according to the latest global pipeline market report.

Market research firm Douglas Westwood has released its World Onshore Pipelines Market Forecast 2015-2019. While the report states that the fall in oil prices continues to impact the pipeline industry, mainly in North America, the five-year outlook for the global pipeline industry is positive.

The report states “The pipeline market itself if well-cushioned from short-term commodity price fluctuations with projects typically responsive to long-term demand and supply trends.”

Douglas Westwood forecasts that onshore pipeline expenditure will grow by US$220 billion (14 per cent) between 2015 and 2019, with approximately 309,000 km of pipeline expected to be installed globally. This is compared to a US$193 billion growth-rate, and 11 per cent increase on pipeline installed for the previous five-year period.

“An increasing volume of pipeline installations is expected in most regions, supported by continued product demand growth in both new and existing population centres, new and increasing hydrocarbon supply, and a shift in energy demand preferences towards gas,” says the report.

According to market research firm, North America and Asia remain the highest volume markets to 2019, accounting for approximately 45 per cent of global pipeline construction CAPEX, but fastest growth is anticipated in the Middle East.

Other key trends highlighted by the report:

  • Anticipated 35 per cent increase in global energy demand between 2010 and 2040
  • Natural gas demand expected to increase by 65 per cent, driven largely by non-OECD demand growth and technology advancements (including LNG)
  • Investment in new infrastructure to support LNG and UCG developments will drive demand for pipelines
  • Outside Middle East region, gas pipelines are expected to account for 66 per cent of km installed globally.
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