MOUNTAIN VIEW, Calif., March 20, 2013 /PRNewswire/ -- Pipelines are fast becoming the preferred mode for oil and natural gas transportation, as pipeline companies overcome the initial resistance from environmental groups. This improved business environment, along with manufacturers' ability to enhance monitoring systems and alleviate safety concerns, opens up bigger opportunities for onshore oil and gas pipelines in North America.
New analysis from Frost & Sullivan's ( http://www.energy.frost.com) Analysis of the North American Onshore Oil and Gas Pipelines Market research finds the market will expand at an approximately 1.0 percent compound annual growth rate (CAGR) between 2011 and 2017. The analysis also finds that in 2009, before the natural gas impetus we see today, the interstate and intrastate transmission pipeline mileage for natural gas totaled more than 250,000 miles, crude oil transmission totaled 65,000 miles, and petroleum products totaled more than 100,000 miles in pipeline mileage.
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The exploration of unconventional resources increased energy production and created a need to connect new crude and natural gas sources to their demand centers. This accelerates pipeline network expansion."The cost efficiency of transporting hydrocarbons through pipelines rather than by road, rail or sea will attract investments from operators," said Frost & Sullivan Industry Analyst Rajalingam Chinnasamy. " North America has some of the oldest pipeline infrastructure globally, and long-term replacement opportunities will add to market revenues." While market opportunities abound, the increasing costs of labor, along with low gas prices and excess pipeline capacities, dampen market growth. Further, recent pipeline leaks raised concerns over the environmental impact of this transportation method. Stricter environmental regulations will only increase construction costs and hinder revenue growth. Therefore, companies must manage their in-house knowledge base better to prevent leaks and widen the pipeline infrastructure in North America. "Currently, pipeline companies find it difficult to obtain environmental clearance for new projects that pass through sensitive ecological habitats," concluded Chinnasamy. "Implementing predictive maintenance practices will enhance their credibility among environmental groups and the public."