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SCADA Market for Oil & Gas Propelled by Strong Pipeline Activity Worldwide

The worldwide Supervisory Control and Data Acquisition (SCADA) market reflects the impact of new technology on SCADA components and cost- effective communications for both data and knowledge transfer. Today’s SCADA systems offer a new generation of technology components that are easier to integrate and provide improved capabilities and functionalities. After weathering the effects of the 2008-2009 global recession, the market has rebounded strongly, growing at high single- and low double-digit rates. As demand for oil recovers and funding is freed up, project activity can be expected to return to robust levels in coming years, according to a new ARC Advisory Group study.

A number of significant factors are driving the worldwide SCADA market in the oil and gas industry. These include the continuing worldwide demand for additional energy from carbon-based fuels, the shifting of exploration and production locations to more remote and hostile environments, and end user requirements to link SCADA to information technology and business systems. Operating companies are placing an increasing emphasis on vendor services over the entire value chain and asset lifecycle and are looking for additional functionalities in application software. “SCADA systems, together with advanced applications, improve visibility and the performance of geographically dispersed assets, and form the basis for real-time performance management of production and pipeline assets,” according to Senior Analyst Allen Avery, the principal author of ARC’s “SCADA Systems for the Oil & Gas Industry Worldwide Outlook”.

The Expanding Role of SCADA in the Enterprise

SCADA suppliers are offering more flexible hardware with added intelligence and emphasizing total solutions by coupling their hardware and software with service packages. Traditional SCADA suppliers are introducing new and innovative product features and helping clients develop migration planning programs. Suppliers are also offering a wider range of web-enabled advanced applications and packaged solutions, particularly for users seeking to integrate SCADA with business and enterprise level applications and supply chains. Beyond its traditional role of data gathering and control, the value of SCADA systems is being enhanced with the addition of applications that enable business intelligence, giving users better insight into the economics of their operations, the ability to better validate nominations and pipeline allocations, and tools to track carbon emissions to help comply with environmental regulations.

Emerging Markets Driving Growth

North America is the largest single market, accounting for slightly under a half of all shipments, and showed strong growth between 2010 and 2011, as pipeline activity continued to move at a brisk pace, and pipeline operators sought to update their systems to take full advantage of the functionalities of modern SCADA systems. EMEA, the second largest segment, saw more modest growth during the same period, due to a drop in activity in Western Europe. The market focus continues to shift to the developing regions of the world, where numerous major Greenfield energy projects are occurring at a pace that exceeds that of the developed regions. Asia, led by China, posted strong growth in project activity during 2010, and will continue to drive growth going forward.

For more information on this study, please visit our Market Research section from ARC.

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