Steady Investment In Middle East and North African Energy Industry Powers Demand for NDT Inspection Services
Posted: 2014-12-13
Continued investment in new oil and gas as well as power generation projects is
accelerating the need for nondestructive testing (NDT) inspection services in the
Middle East and North Africa. Despite pressure on global oil prices and fears of a
slowdown, the Middle Eastern oil and gas industry is expected to remain robust,
offering immense growth opportunities for the NDT inspection services market.
New analysis from Frost & Sullivan, Beyond BRIC—Strategic Analysis of the Middle
East and North African NDT Inspection Services Market, finds that the market
earned revenues of USD 796.4 Million in 2014 and estimates this to reach USD
1,310.9 Million in 2019. The Kingdom of Saudi Arabia will be the biggest market
and grow at a compound annual growth rate of 11.6 per cent over the next five
years.
For complimentary access to more information on this research, please visit:
http://corpcom.frost.com/forms/MI_NDT
The Brent crude oil price, against which the Middle East and North African
countries benchmark their oil industry, has remained high since 2011. As a
result, oil and gas companies have earned significant revenue and duly invested
back in infrastructure development.
"A number of new construction projects were announced between 2012 and
2014, benefitting the NDT inspection services market since an average of one
percent of the cost in any new construction project can be attributed to NDT
inspection," said Frost & Sullivan Measurement and Instrumentation Senior
Research Analyst Nikhil Jain. "In addition, the growing focus on safety in the oil
and gas industry is driving the demand for NDT inspection services in Middle
East and North Africa."
An important trend in the market is the increasing competition based on price.
The influx of Korean and Indian NDT inspection service providers has caused
average prices to decline to historically low levels, affecting profits. For instance,
companies such as S&K Engineering (www.skengineering.net), Samsung
Engineering (www.samsungengineering.com) and Hyundai Engineering
(www.hec.co.kr) have recently won contracts for mega construction projects by
quoting extremely low prices. To maintain a healthy profit margin, they then
source products and services from less expensive Korean companies.
Educating customers on the importance of quality over price will be vital to
succeed in this competitive market. Participants must also explore the possibility
of providing advanced NDT services to offset low profit margins.
"Competition in the advanced NDT services segment is far lower than for
conventional services," noted Jain. "Hence, service providers offering
sophisticated solutions can charge a premium and boost revenues in the Middle
East and North African market."
Beyond BRIC—Strategic Analysis of the Middle East and North African NDT
Inspection Services Market is part of the Test & Measurement
(http://www.testandmeasurement.frost.com) Growth Partnership Service
program. Frost & Sullivan’s related studies include: Global voice over LTE (VoLTE)
Testing and Monitoring Market, Global LTE-Advanced Test Equipment Market,
Analysis of Global NDT Equipment Market, Analysis of Global NDT Training
Services Market, Emerging and Non-traditional NDT Equipment Market, and
Analysis of Global Ultrasonic NDT Equipment Market. All studies included in
subscriptions provide detailed market opportunities and industry trends
evaluated following extensive interviews with market participants.
accelerating the need for nondestructive testing (NDT) inspection services in the
Middle East and North Africa. Despite pressure on global oil prices and fears of a
slowdown, the Middle Eastern oil and gas industry is expected to remain robust,
offering immense growth opportunities for the NDT inspection services market.
New analysis from Frost & Sullivan, Beyond BRIC—Strategic Analysis of the Middle
East and North African NDT Inspection Services Market, finds that the market
earned revenues of USD 796.4 Million in 2014 and estimates this to reach USD
1,310.9 Million in 2019. The Kingdom of Saudi Arabia will be the biggest market
and grow at a compound annual growth rate of 11.6 per cent over the next five
years.
For complimentary access to more information on this research, please visit:
http://corpcom.frost.com/forms/MI_NDT
The Brent crude oil price, against which the Middle East and North African
countries benchmark their oil industry, has remained high since 2011. As a
result, oil and gas companies have earned significant revenue and duly invested
back in infrastructure development.
"A number of new construction projects were announced between 2012 and
2014, benefitting the NDT inspection services market since an average of one
percent of the cost in any new construction project can be attributed to NDT
inspection," said Frost & Sullivan Measurement and Instrumentation Senior
Research Analyst Nikhil Jain. "In addition, the growing focus on safety in the oil
and gas industry is driving the demand for NDT inspection services in Middle
East and North Africa."
An important trend in the market is the increasing competition based on price.
The influx of Korean and Indian NDT inspection service providers has caused
average prices to decline to historically low levels, affecting profits. For instance,
companies such as S&K Engineering (www.skengineering.net), Samsung
Engineering (www.samsungengineering.com) and Hyundai Engineering
(www.hec.co.kr) have recently won contracts for mega construction projects by
quoting extremely low prices. To maintain a healthy profit margin, they then
source products and services from less expensive Korean companies.
Educating customers on the importance of quality over price will be vital to
succeed in this competitive market. Participants must also explore the possibility
of providing advanced NDT services to offset low profit margins.
"Competition in the advanced NDT services segment is far lower than for
conventional services," noted Jain. "Hence, service providers offering
sophisticated solutions can charge a premium and boost revenues in the Middle
East and North African market."
Beyond BRIC—Strategic Analysis of the Middle East and North African NDT
Inspection Services Market is part of the Test & Measurement
(http://www.testandmeasurement.frost.com) Growth Partnership Service
program. Frost & Sullivan’s related studies include: Global voice over LTE (VoLTE)
Testing and Monitoring Market, Global LTE-Advanced Test Equipment Market,
Analysis of Global NDT Equipment Market, Analysis of Global NDT Training
Services Market, Emerging and Non-traditional NDT Equipment Market, and
Analysis of Global Ultrasonic NDT Equipment Market. All studies included in
subscriptions provide detailed market opportunities and industry trends
evaluated following extensive interviews with market participants.
