NEWS RELEASE November 2018
What do Biopharmaceuticals, Shale Fracturing and IIoT have in Common
Biopharmaceuticals, shale fracturing, and IIoT are very important to suppliers of combust, flow, and treat (CFT) products and services. Here is what they have in common
- High growth opportunities
- U.S opportunity is very large
- U.S. sucess can be leveraged internationally
There is a warning about this unique American opportunity best explained by the question. What do coal fired boiler APC, semiconductor manufacturing, and mobile phones have in common? The answer is that the U.S. is no longer the center of activity and those American companies who did not seize the international opportunity are no longer leaders. The Chinese now are the coal fired boiler APC leaders. TSMC in Taiwan is the leading chip manufacturer. 400 million people in India have mobile phones which relegates the U.S to third place behind China in mobile phone use.
Biopharmaceuticals: The combust, flow and treat revenues for this industry will be growing at more than 10 percent per year. The U.S. is where the action is. Over 40 percent of the market is in the U.S. Filter suppliers such as Pall and Millipore are on the cutting edge of single use technologies. Crane and ITT are leaders in valve development. AES is a leading supplier of turnkey cleanrooms for this industry. Baker is a leader in biosafety cabinets. U.S. companies or U.S divisions of international companies will have the opportunity to expand with the industry as it internationalizes. McIlvaine is conducting a number of webinars on the subject in the first quarter First Quarter 2019 Webinars will Focus on Biopharmaceuticals
Shale fracturing: One can argue that the present booming U.S. economy is primarily the result of a few individuals who innovated fracturing technologies for shale over the last two decades and made the U.S. a world leader in gas and oil production. These innovations continue as U.S. companies have perfected horizontal drilling techniques, proppant design and have found all sorts of ways to make the cost of oil and gas competitive with other sources around the world. This extends to related processes.
CFT suppliers have big opportunities in the fracking processes and transport and treatment of the products. They also have big opportunities in related processes such as Frac sand. The cost of fracking is being reduced by the use of Texas and local sands rather than the superior natural sands found in Wisconsin. CFT equipment and services are utilizing local sands treated in a series of wet and then dry processes to create equivalent proppants delivered at lower cost. A number of U.S. companies are wet and dry plant design leaders. All of this activity is covered in various market reports http://home.mcilvainecompany.com/index.php/markets. Details on the companies and technology are tracked in N049 Oil, Gas, Shale and Refining Markets and Projects.
However, the opportunity is fleeting. One Japanese supplier has moved into the frac sand plant delivery. Sinopec, one of the world’s largest oil and gas companies has the American Jereh division in Houston and supplies fracking trucks, valves, and pumps. Sinopec has also tailored the fracking technology to make it economical to extract oil and gas in China. China has the world’s largest shale reserves. So the challenge for CFT suppliers will be to create winning strategies for the international market by leveraging the short term advantage in the U.S.
How is this possible? The domination of China in coal fired boiler air pollution control was not inevitable. B&W had thousands of people in its China. All the early FGD systems in China were through international licenses. The problem was that as the licensees embarked on supplying three times as much FGD as had been installed in the U.S. they became the most expert and experienced providers. The solution for B&W and other international suppliers could have been IIoT and Remote O&M. Doosan and MHPS are taking this path to insure their international position. So this leads us to the third commonality.
IIoT and Remote O&M: B&W still retains the experience and knowledgeable people to help coal fired boiler operators around the world. B&W bought the Joy air pollution control group decades ago. This group along with Nitro Atomizer developed spray drier FGD. In 1969 B&W became the second company to supply a wet FGD system and was an early leader in the technology. B&W has a substantial share of the U.S. inventory of FGD plants and also through licensees and joint ventures has worldwide experience. B&W supplies parts and service. With wireless transmission, remote monitoring and data analytics B&W subject matter ultra-experts (SMUEs) can be generating revenues for B&W at coal plants around the world.
GE is in a very good position to capitalize on the coal fired boiler wisdom residing in Connecticut as a result of the ownership of the former CE. It also owns what was once Flakt air pollution control. The legacy companies supplied the first FGD system at Union Electric in 1968 using scrubbers supplied by Environeering. At the time Robert McIlvaine was president of Environeering. CE later licensed the scrubber technology.
The CEO of GE coined the term IIoT and has been a leader in the adoption of this concept in several different industries. U.S. companies are leaders in automation, controls, wireless communication, data analytics and subject matter expertise. A U.S. CFT system supplier can incorporate the latest process management software, and data analytics using products of U.S. based companies with an international reach. This applies not only to coal fired boiler FGD but to biopharmaceutical and semiconductor cleanrooms, ultrapure water, and exhaust gas treatment. A webinar January 9 will cover this opportunity The IIoT Market Size and Structure. The full analysis is described at N031 Industrial IOT and Remote O&M