There are some segments which are growing at much higher rates over the next few years. One is the flue gas desulfurization market (FGD) in India. There will be 100,000 MW of limestone systems which make a gypsum product. Valves are needed for delivery of water to be used in the systems. This water is used to transport limestone slurries and then the recycling scrubber liquor which includes a mix of limestone and gypsum. For large systems there can be a flow of up to 400,000 gpm. This requires multiple pumps and multiple slurry isolation valves.
Vietnam, Indonesia, the Philippines, and a few other countries are also installing FGD systems at an accelerated rate. The actual purchasers are large engineering companies with international partnerships or Chinese companies who may be supplying power plant financing along with construction of the FGD systems.
China is upgrading more than 200,000 MW of coal fired boilers to improve efficiency from the subcritical and supercritical level to that of ultra-supercritical. The target is 50 percent efficiency and plants as clean as the cleanest gas fired plant. These upgrades with the higher temperatures and pressures in the steam system require investment in valves designed for the extreme conditions.
Biopharmaceutical construction in the United States is another high growth market. The market for valves is growing faster than total CFT systems. The reason is that much of the investment is in closed systems. Butterfly valves are used in the transfer of product from one containment vessel to the next.
Hydraulic fracturing in the U.S. is having an impact on valve sales not only in the direct use, but in industries benefiting from the low raw product prices. The U.S. was already the largest combined oil and gas producer prior up to April of this year, when it also became the largest oil producer. Investment by the major oil companies is having a significant impact. The majors will produce half the oil coming out of the Permian basin in the coming decade.
Increase in refining
This is important not only because of the increase in supply but also the concurrent increase in refining and transportation capacity. Presently USD$100 billion is being spent for terminals, LNG liquefaction facilities, refineries, and petrochemical plants in Texas and Louisiana. Planned projects will generate a USD$20 billion per year capital investment and over USD$300 million per year in new CFT products. This initiative also accelerates the concentration of CFT purchasing in a few companies. Chevron and Exxon will each be producing more than 1 billion barrels/day in the region.
Hydraulic fracturing requires the manufacture of special sands, the trucking of these sands to the drill site and then the mixing of the sand with water and additives. Finally, the mix is injected at high pressure into the well. A significant number of valves are needed in this process.
Water reuse with zero liquid water discharge is also a growth market for valve suppliers. Desalination is one form of water reuse. New desalination plants are major users of valves. Growth in excess of seven percent per year is anticipated over the next five years. China is moving well up in the rankings and is now one of the world’s leading countries, along with some in the Middle East, in terms of desalination capacity.