Feeling the heat
28 Jan 2008
High demand for heat exchangers has put pressure on suppliers, as there is an acute scarcity of some materials, particularly steel, nickel and aluminium, according to Kaushik Ghosh, a market analyst at Frost & Sullivan
In addition to lengthening delivery times, the materials shortages are hindering the growth plans of manufacturers, Ghosh said an F&S report, European Heat Exchanger Market, which values the business at $3.5 billion (£1.75 billion) in 2006. Rising raw material prices, meanwhile, are forcing up the product price and doing little harm to manufacturers’ profits.
The supply of heat exchangers is an extremely competitive market, however, to which there has been a number of new entrants. This is giving some price relief to customers, says the market researcher, as it is forcing manufacturers to be “price-takers”.
This situation has created enough pressure to ensure that prices remain competitive, even in the face of the increasing material and labour costs, although they have gone up by around 15% since 2004.
For the five years to 2013, F&S forecasts annual price increases of 3-5%. In this period it expects suppliers to increase their portfolios and step-up their service operations in order to retain business with existing clients. At the same time, it anticipates increased R&D investment as manufacturers explore alternatives to compensate for the raw materials scarcity.
Power generation and oil and gas are the most important sectors for the future and are predicted to drive consumption. The key to their status is the commissioning of major oil projects and higher demands for power from a general growth in industrialisation.
The significant investments being made in chemicals, fuel processing and power generation in Central and Eastern Europe will certainly have a very positive influence on the future European market. Also, there remains a high replacement business in existing applications due to the limited life span of many installed heat exchangers that demands a combination of frequent upgrades and product renewals.
The future of the heat exchanger market in Europe lies in plate heat exchangers, according to F&S analyst Ghosh. He says their popularity is growing because of the advantages they hold over shell and tube categories.
“Plate heat exchangers are compact, can be modularised in different shapes and sizes and show increased efficiency in heat transfer,” explains Ghosh. “They can withstand high temperatures and pressures, and also incur low installation and maintenance costs.”
Overall, Ghosh estimates that the European heat exchanger market is growing at a rate of 10% annually, driven by high demand from the chemicals, fuel processing, power generation, pulp and paper, petrochemicals and oil and gas sectors
According to the analyst, the Iraq war has played a significant part in the buoyant market conditions as the escalating price of oil prompted the initiation of many projects like gas to liquid, liquefied natural gas and ethylene cracker plants that were previously on hold.
Wireless network is a first
StatoilHydro is employing an Emerson wireless self-organising mesh field network to monitor heat exchanger and wellhead annular pressures on the Grane offshore platform in the Norwegian Sea off the coast of Bergen, Norway. The application is claimed to be first offshore wireless installation in Europe.
The wireless network enables continuous monitoring of pressures and eliminates the need for daily visits to the wellhead to manually record gauge readings. Continuous monitoring enables unusual readings to be identified earlier and action taken to investigate and rectify faults before they develop into serious problems.
The Smart Wireless network on the platform includes 22 wireless Rosemount pressure transmitters, which replace traditional gauges. Twelve pressure transmitters monitor inlet pressure and pressure drop over the heat exchanger, with a further ten pressure transmitters used to measure annular pressure.
Each transmitter relays data back to the operator consoles in the control room. Installation, said Emerson, was quick and easy with a gauge adapter fitting used to allow a direct ‘screw-in’ replacement. A wireless gateway is mounted outside the process area on one side of the platform, at a height where it oversees the wellhead area.
