The global onshore pipelines market is forecast to see a continued growth in overall spend from 2017 to 2022 at a compound rate of 1.4%. Overall, over the next five years, this represents a 15% growth in total spend versus the previous five-year period, as forecast in the latest edition of the World Onshore Pipelines Market Forecast by Westwood Global Energy (Westwood).

The report includes regional capital and operational expenditure forecasts, including examples of key countries and projects driving installation activity and expenditure within each region. Westwood expects the market to see a near-term increase in installation activity, with the total number of additional kilometres installed forecast to rise by 13% in 2018, supported predominantly by projects sanctioned prior to the downturn. The nature of the market, with long-lead times for many projects, does mean that the lack of new project-sanctioning activity in recent years will result in a slight decline in km installed and spend following the 2018 peak. However, overall forecast Capex for the 2018-2022 period will still represent a 13% increase compared with the preceding five-year period.

Global Onshore Pipeline Expenditure and Additional km, 2013-2022

For capital expenditure, regional market forecasts are provided for line pipe, right of way, fittings, stations, and construction, while operational expenditure is split in terms of operations-related expenditure, integrity management, technical & land management support, and stations. The report also provides a technical review of the project process from pre-FEED and FEED through to engineering, procurement, and construction (EPC) and operations and maintenance. It is therefore an essential tool for equipment manufacturers, onshore construction companies, steel mills, and pipeline operators, as well as government agencies and financial institutions requiring comprehensive, up-to-date insight into the market.

An increasing population of ageing pipelines, in addition to stringent regulations governing essential repairs and maintenance works (particularly in regions such as North America and Western Europe) will continue to act as stable long-term drivers for operational expenditure, with spend over the 2018-2022 period expected to increase by 17%, relative to the 2013-2017 period.

• North America has historically dominated installation activity, and will continue to do so over the forecast period, albeit with a reduced share of 34%, compared with 44% over the 2013-2017 period.
• While installation activity for both medium (24-41 inch) and large (>41 inch) diameter pipelines is expected to decline over the next five years, Capex allocated to small (<24 inch) pipelines is forecast to rise by 21% over 2018-2022.
• Africa is expected to see the strongest growth in terms of total forecast capital expenditure for the next five years, when compared to the 2013-2017 period. Total expenditure in the region for 2018-2022 is forecast to rise by 84%, relative to the preceding five years.
• Global pipelines Opex is forecast to rise steadily at a 3.5% CAGR over the next five years driven by an increase in the installed base of infrastructure and the need to maintain aging networks, particularly in Western Europe and North America.

Major projects underway include the 8,372km Xin-Zhe-Yue synthetic gas pipeline in China and the 4,000km Power of Siberia I pipeline from Russia to China. North America will remain the largest contributor to the market, with projects such as the 1,659km Line 3 Replacement Project are expected to support capital expenditure within the region over the forecast. Moreover, large projects such as the 1,400km Hoima to Tanga crude oil pipeline will contribute to relatively high installation activity in the African market, compared to the preceding five years.
Source: Westwood Global Energy