Hectic Exploration Activities Make a Case for Electrical Equipment in the Oil and Gas Industry, Finds Frost & Sullivan Tax waivers on equipment bolster regional market growth
SINGAPORE, Oct. 12, 2012 /PRNewswire/ -- The escalating demand for energy in the Asia Pacific has set off a spate of exploration activities in the oil and gas sector, creating a vast market for electrical equipment and solution suppliers to sell into. Equipment suppliers will also feel buoyed by the discovery of oil and gas resources in the region, as it encourages refineries and petrochemical companies to initiate several upstream and downstream projects.
New analysis from Frost & Sullivan (http://www.energy.frost.com), Electrical Equipment and Solution for Oil and Gas Markets in the Asia-Pacific, finds that the market earned revenues of $614.4 million in 2011 and estimates this to reach $793.9 million in 2016 on the back of field exploration activities, oil and gas field developmental projects, demand for oil and liquid nitrogen gas for power generation, as well as industrial development.
"Currently, these gas fields use obsolete production technology, resulting in inefficient production," said Frost & Sullivan Research Analyst Avanthika Satheesh P. "Owing to the non-renewable nature of oil & gas resources, there is an urgent need for advanced and specialized techniques such as enhanced oil recovery, to extract oil from depleting resources."
Acknowledging the importance of foreign investments and sophisticated technology, the governments of countries such as Malaysia and Indonesia have announced tax waivers on equipment imported for resource extraction and development.
The Indonesian government has eliminated import taxes on offshore and subsea exploration equipment in the upstream sector, while the Malaysian government announced incentives to promote the development of new oil reserves and hard-to-reach oil fields to improve domestic production.
While on the one hand tax waivers benefit the electrical equipment and solutions market, carbon taxes are dampening its growth prospects by discouraging oil and gas production. The market is also pegged back by the lack of skilled labor force and dependence on the availability of resources. In oil-deficit countries, revenues are mainly generated by downstream segments and exploration activities. The market is further hindered by project delays brought on by financial crunches.
"In due course, the market will expand when the held up capital is released and the tendered projects recommence," noted Satheesh. "The price hikes in petroleum products will be an added incentive to increase production from existing oil wells and develop the newly discovered reserves, which, in turn, will boost the prospects of the electrical equipment and solutions market."
If you are interested in more information on this research, please send an email with your contact details to Jessie Loh, Corporate Communications, at email@example.com.
Electrical Equipment and Solution for Oil and Gas Markets in the Asia-Pacific is part of the Energy & Power Growth Partnership Services program, which also includes research on the North American electrical equipment for oil and gas market. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants.
Our "Growth Partnership" supports clients by addressing these opportunities and incorporating two key elements driving visionary innovation: The Integrated Value Proposition and The Partnership Infrastructure.
- The Integrated Value Proposition provides support to our clients throughout all phases of their journey to visionary innovation including: research, analysis, strategy, vision, innovation and implementation.
- The Partnership Infrastructure is entirely unique as it constructs the foundation upon which visionary innovation becomes possible. This includes our 360 degree research, comprehensive industry coverage, career best practices as well as our global footprint of more than 40 offices.
For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies?
Corporate Communications – Asia Pacific
P: +61 (02) 8247 8927
F: +61 (02) 9252 8066
Corporate Communications – Asia Pacific
P: +65 6890 0942
F: +65 6890 0988
SOURCE Frost & Sullivan