The global produced water treatment market size was USD 5.81 billion in 2015. Strict regulations regarding produced water discharge limits have led to a boost in the requirements for advanced technologies for separation of oil, and for enhancing the efficiency of oil recovery.
Produced water is a byproduct of the exploration & production (E&P) operations of oil & natural gas. Treatment of produced water in the oil & gas sector involves the use of various primary, secondary, and tertiary separation methods for removal of oil droplets, sediments, mud particles, heavy metal particles, salts, hydrocarbons and other organic content.
The increasing use of rainwater coupled with the prolonged discharge of oil colloidal particles in aquatic bodies is expected to pollute the existing resources and lead to scarcity issues in the future. Hence, governments of developed countries including Germany and the U.S. have implemented stringent environmental policies and practices by imposing minimized or zero discharge limits of oil concentrations in disposed streams.
The emergence of the U.S. and Canada as a production destination for alternative sources including tight oil and shale gas as a result of increasing spending on hydraulic fracturing is projected to have a significant impact on the market. Furthermore, regulatory support towards increasing E&P spending towards coal bed methane (CBM) and gas hydrates in Durgapur and Andaman & Nicobar in India, respectively is expected to open new opportunities for growth over the next eight years.
Low adoption rate of technologies in the oil & gas sectors of developing countries including Indonesia and India in light of the lack of regulations about water management in the energy sector is expected to remain a challenging factor for the industry participants. Furthermore, increasing usage of enhanced oil recovery in Russia, Venezuela and UAE are projected to limit the application of produced water treatment services.
Russia Produced Water Treatment Market Revenue, By Technology, 2013 - 2024 (USD Million)
Secondary separation accounted for 46.8% of the global revenue in 2015. The technology involves the use of degassers; flotation, solid separators, membrane filtration, electro-coagulation, and adsorption.
Tertiary separation is expected to remain fastest growing technology segment at a CAGR of 6.8% from 2016 to 2024. Rising environmental concerns associated with BTX (benzene, toluene, xylene) in the oil & gas industry in light of increasing awareness towards the reduction in greenhouse gas emissions is expected to play a significant role in increasing the usage of tertiary treatment.
Production Source Insights
Crude oil accounted for 62.8% of the global revenue share in 2015. Production of crude from conventional sources has considerably declined over the past few years due to continuous depletion of crude concentrations in the oil-water produced streams. This scenario is likely to reflect in terms of a drop in the market share of crude as a production source.
Rising production of natural gas as a result of technological advancement on account of increasing importance of LNG is expected to promote the usage of water management services. Furthermore, the majority of countries including China, India, Pakistan, and Bangladesh have planned to increase the share of natural gas to reduce the reliance on crude and coal as a source of energy generation. Therefore, natural gas is expected to remain fastest growing production source with a growth rate of 6.2% from 2016 to 2024.
Onshore accounted for 72% of the global market revenue share in 2015. The high adoption rate of management services in onshore fields to limit the utilized water for irrigation applications is expected to have a positive impact.
Offshore is expected to witness the fastest growth at a CAGR of 6.3% from 2016 to 2024. Over the past few years, the prominent market players including Siemens are focusing on secondary and advanced treatment technologies for minimizing the discharge as well oil spills in surrounding aquatic bodies in the offshore sector. This favorable scenario is likely to promote the application of produced water management services.
North America dominated the market accounting for .42.5% of total revenue in 2015. The robust presence of crude reserves in the U.S. and Canada is expected to result in the effective usage of water management services.
Asia Pacific is anticipated to witness the fastest growth at a CAGR of 7.1% from 2016 to 2024. The implementation of “First Shale Gas Policy” and “Open Acreage Licensing Policy (OALP)” by the governments of China and India, respectively will be a key driver over the next eight years.
Key industry participants include Veolia, Siemens, GE, Schlumberger, Halliburton Company, Weatherford International, Baker Hughes, Exterran Corporation, and Ovivo. The produced water treatment industry is highly fragmented in nature and the top four market players together accounted for 21.6% market share in the year 2015. The market comprises of prominent, well-established players that captured a small chunk of the pie, while the larger portion of the pie was captured by other global and regional players in 2015.
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