PUBLISHER: AnalystView Market Insights | PRODUCT CODE: 1555556
PUBLISHER: AnalystView Market Insights | PRODUCT CODE: 1555556
Oil & Gas EPC Market size was valued at USD 4,32,518.2 Million in 2023, expanding at a CAGR of 5.00% from 2024 to 2032.
The market for oil & gas EPC includes all of the services that EPC firms offer. These services include oil and gas infrastructure design and engineering, as well as the acquisition of equipment and materials needed for the job. Assuring adherence to project timeframes, cost estimates, and technical standards, EPC contracts play a crucial role in enabling the efficient execution of oil and gas projects. The massive mergers and acquisitions, changing global demand, and technological changes that have transformed the oil & gas EPC Market are putting it in a key position. With 1,571 M&A transactions in 2023, the oil and gas industry saw a strong consolidation. Notable examples of this include ExxonMobil's $64.5 billion acquisition of Pioneer Natural Resources and Chevron's $60 billion acquisition of Hess' Guyana holdings.
Oil & Gas EPC Market- Market Dynamics
Increased Demand for Crude Oil and Natural Gas to Propel Market Growth
The expansion of the oil & gas EPC market is supported by the rising need for energy on a worldwide scale, especially for natural gas and crude oil. This increase is driven by the world's continued reliance on fossil fuels as the main source of energy and the rising energy consumption in emerging economies. EPC firms play a more crucial role as market conditions encourage increasing production to fulfill this growing demand. These businesses are crucial to the planning, building, and upkeep of the infrastructure required to increase production capacity in an efficient and long-lasting manner. Growing energy demands and EPC services are correlated, indicating a strong market growth trajectory driven by the volume and complexity of necessary infrastructure projects.
Oil & Gas EPC Market- Key Insights
As per the analysis shared by our research analyst, the global market is estimated to grow annually at a CAGR of around 5.00% over the forecast period (2024-2032)
Based on contract type segmentation, the construction & installation category was predicted to show maximum market share in the year 2023
Based on end-user segmentation, the upstream category was the leading segment in 2023
On the basis of region, North America was the leading revenue generator in 2023
The Global Oil & Gas EPC Market is segmented on the basis of Contract Type, End-user, Application, and Region.
The market is divided into the following categories based on contract type: Fabrication & Equipment, Construction & Installation, Management Services, and Others. The construction & installation category dominates the market. While the construction and installation segment consists of building production platforms, drilling rigs, and refineries at onshore or offshore locations, the installation segment includes projects where a company provides services to install platforms, pipes, pipe fittings, boilers, turbines, mud pumps, fans, and engines. Construction and installation have become the dominant segment due to the development of oil and gas fields and facilities. Over the forecast term, this tendency is anticipated to continue.
The market is divided into three categories based on end-user: Upstream, Midstream, and Downstream. The upstream category dominates the market and is likely to maintain its dominance during the forecast period. Exploration and production (E&P) activities are included in the upstream sector. The sector's dominance is ascribed to the massive exploration efforts for new gas and oil reserves, which are fueled by the increase in global energy consumption. In the upstream industry, EPC services encompass a wide range of sophisticated and high-tech projects, from drilling and well completion to seismic surveys and geological modeling. The emphasis on non-traditional resources such as deep-water deposits and shale gas increases the need for specialized EPC services. In order to maintain their competitive advantage in the market, businesses in this sector are making significant investments in cutting-edge technologies that will increase exploration success rates and maximize production efficiency.
Oil & Gas EPC Market- Geographical Insights
Geographically, this market is widespread into the regions of North America, Latin America, Europe, Asia Pacific, and the Middle East and Africa. These regions are further divided as per the nations bringing business.
Over the course of the forecast period, North America is anticipated to hold the greatest share of the global market for Oil & Gas EPC, which is propelled by the region's significant natural gas and oil reserves. The oil and gas industry has experienced a renaissance in the United States, specifically because of technological breakthroughs in extraction methods such as horizontal drilling and hydraulic fracturing, particularly in shale formations. The enormous oil sand deposits and LNG projects in Canada have an impact on the market. Favorable governmental policies and the presence of large oil and gas corporations and EPC contractors facilitate the expansion of the oil & gas EPC market in North America. The market is further characterized by its emphasis on cutting down on environmental impact and integrating contemporary technologies into operations.
In addition, the Oil & Gas EPC market is anticipated to expand at the fastest rate in the world during the projected period in Asia Pacific. Growing energy consumption as a result of fast industrialization and urbanization, especially in China & India, is the main driver of this growth. The need for EPC services is driven by large investments in the discovery, development, and upgrading of new oil and gas fields, as well as the upgrade of existing infrastructure. The market is also greatly influenced by the increasing attention being paid to LNG projects in Australia and the burgeoning oil and gas industry in Indonesia. For EPC businesses, the region's competitive and diverse landscape presents a number of opportunities, particularly when it comes to incorporating cutting-edge and sustainable technologies.
The Oil & Gas EPC market is fragmented, with numerous small firms offering the oil and gas industry construction, fabrication, and installation services. Due to the rising demand for oil and gas reserves, EPC contractors are working hard to meet the expanding demand for EPC services. Among the important players are WorleyParsons, Saipem, Subsea 7, Larsen & Toubro, Petrofac, TechnicpFMC, McDermott, and KBR. This industry is expected to expand, offering profitable prospects for market participants due to rising energy consumption and greenfield and brownfield development activities.
March 2024: One of the biggest oil firms in the world, Saudi Aramco, has awarded a substantial Engineering, Procurement, and Construction (EPC) contract to Kalpataru Power Transmission Limited (KPTL). This contract demonstrates KPTL's expanding footprint in the global oil and gas industry as well as its capacity to carry out significant infrastructure projects. The agreement strengthens KPTL's position as a top worldwide EPC service provider and highlights the company's strategic entry into the Middle Eastern market. It also expands its portfolio of high-value projects.
September 2023: Major UK operators have awarded contracts to John Wood Group PLC for its digital maintenance optimization technology, maintAI. Up to 20% less operational costs and maintenance backlog are possible with this system, which makes use of artificial intelligence and customer data. Additionally, Wood is assisting a global operator in minimizing maintenance backlogs and optimizing maintenance across North Sea assets by utilizing maintAI.
October 2023: On behalf of North Eastern Electric Power Corporation (NEEPCO), NTPC Green Energy put in bids for the engineering, procurement, and construction (EPC) package together with land development for solar power projects across India that have an interstate transmission system (ISTS) connection and can produce up to 300 MW.