Investments in the oil and gas industry, as well as the automation and control solutions (ACS) market, are expected to see increases over the next several years. Frost & Sullivan analysis says a growing Turkish economy with a stable political establishment is a key driver. ACS market investment increases are also expected to see influence from compliances with new regulations governing oil and gas products.
The "Automation and Control Systems in Turkish Oil and Gas Industry" analysis reported the ACS market generated $118.4 million in revenue during 2012, and predicts revenue to reach $183.2 million in 2016. ACS include distributed control systems (DCSs), programmable logic controllers (PLCs), safety instrumented systems (SISs), supervisory control and data acquisition (SCADA), manufacturing execution systems (MESs) and human machine interfaces (HMIs).
"A key factor driving ACS investments is the steadily escalating demand for oil and gas," said Karthik Sundaram, senior analyst for industrial automation and process control research at Frost & Sullivan. "The lack of sufficient domestic production is coercing the Turkish government to encourage new investments and increase subsidies to local companies for greater domestic production."
Turckey’s major end-user segments: upstream, midstream and downstream, should see equal influence from the growth in the oil and gas industry, with several greenfield projects under taken, according to Frost & Sullivan.
"The Turkish government is determined to sustain oil and gas exploration; investments in upstream exploration activities will be spurred by both government and foreign investors," Sundaram said.. "In the case of midstream operations, newer investments are expected primarily from foreign investors as there is a growing emphasis on finding an efficient alternative to Russian gas supply monopoly in Europe."
Two new refining companies are expected to begin operation during the upcoming years that would benefit the downstream segment. While these are positive contributions to the market, Turkey’s economy is seeing increases in interest rates, oil and gas prices and taxes that could turn investors away and damage ACS market growth potential.
"Sales and service support will be instrumental for automation vendors to effectively compete and gain acceptance from Turkish oil and gas companies," Sundaram said. "Improved product functionality will also lay the foundation for sustained market development."