Background
During a recent speech by IndianOil chairman Mr. S M Vaidya, he perfectly demonstrates how much investment the refining sector is planning in the years to come. Mr. Vaidya reported on India’s energy future at IndianOil’s 62nd Annual General Meeting in New Delhi. Saying that “many forecasts state that Indian fuel demand will grow to 400-450 million tonnes by 2040 from 250 million tonnes currently.” Hence, all forms of energy may coexist.” The valve suppliers are awaiting this article and its announcements.
IndianOil plans to launch new projects to meet this surge in demand. As Mr. Vaidya “these translate into refining capacity expansion of over 25 million metric tonnes per annum (MMTPA). Including CPCL, and investment commitments of close to Rs one lakh crore over the next four to five years.”
Among the areas in which IndianOil needs to focus is on the optimal integration of current refining processes to yield more chemical products per barrel of oil. As well as developing alternative energy options, such as CNG, LNG, H-CNG, biofuels, hydrogen, and electric mobility.
The huge investments planned by IndianOil as well as by other companies. They will create significant sales opportunities for valve makers and suppliers. According to a reliable, quantitative assessment, the huge investments planned by companies will inevitably create significant sales opportunities for valve suppliers. As part of an attempt to gain a quantitative understanding of this opportunity. This journal reached out to Resolute Research for information on the predicted future valve and actuator purchases in the Indian refining sector.
Valve Requirements and Valve Suppliers
This chart shows the total valve and actuator sales in India by year (in USD millions). Courtesy of Resolute Research.
The chart below depicts the total sales for the years 2021 through 2026. This indicates that the total expenditure on isolation valves. The control valves, and pressure relief valves could top 1,920 million dollars. In terms of original equipment sales and aftermarket sales. The figures indicate that about USD 1,040 million is the cost of new-build projects, and around USD 880 million is the cost on aftersales.
Keep in mind a caution issued by Resolute Research. When interpreting chart 1. Due to practical considerations, all construction expenditures for new-build plants. They allocate to the target year of commissioning. It is likely, in practice, that spending on valves for large projects will be spread over a number of years. This explains the large spike in 2024.
The following chart shows the total valve and actuator sales in India in 2024, by valve type (in million USD).
In India, total valve and actuator sales in 2024, by valve type (in million USD).
Courtesy of Resolute Research
Resolute Research can also further analyze data to pinpoint sales per valve type. In taking the total sales for 2024 as an example. The chart shows that gate valves will account for the majority of sales (both new-build facilities as well as after-sales). Approximately USD 430 million will be spent on gate valves in the coming year. Another important linear valve – the globe design – ranked second in the sales list in 2024, with almost USD 150 million sold. Remember that the figures shown in this chart reflect the monetary value of valves that will be put into service, not necessarily purchased, in 2024.
Finally, based on publicly available project data. There are 22 active refineries in India. Including five that have been announced, two that are in the planning stages, and one that has been decommissioned. For the record, the oldest refinery in Digboi. Which dates back to 1901, and the most recent is Paradip. Which opened in 2015. In terms of forecast capacity expansions in existing refineries, Vadinar stands out for its sheer scale. As a result, capacity would more than double. From 405 barrels per day today to 920 barrels per day in 2024. Mangaluru, Panipat, Paradip, Koyali, Barauni, and Numaligarh are expected to add large-scale refineries in the future.