The global vapour recovery units market size is anticipated to exhibit substantial growth during the forecast period of 2023 to 2033. According to the research report published by Future Market Insights, the global market is poised to attain a valuation of USD 1,256.2 million in 2023. It is projected to surpass a valuation of USD 2,105.5 million by 2033. The market is expected to showcase a significant CAGR of 5.3% from 2023 to 2033.
Demand for vapour recovery units is increasing in the oil and gas industry as they are used to restrict the loss of crude oil from storage tanks through the restriction of vapour. In a quest for a net-zero future, governments across the globe are imposing stringent regulations to reduce the emission of Volatile Organic Compounds (VOC) from storage tanks. Besides this, the development of upstream and downstream projects in Asia Pacific and North America is also aiding the growth of the market.
| Attributes | Details |
|---|---|
| Vapour Recovery Units Market Share (2022) | USD 1,196.4 million |
| Vapour Recovery Units Market Share (2023) | USD 1,256.2 million |
| Vapour Recovery Units Market Share (2033) | USD 2,105.5 million |
| Vapour Recovery Units Market Share (2023 to 2033) | 5.3% |
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In 2018, the global vapour recovery units market size stood at USD 955.5 million. From 2018 to 2022, the market observed considerable amplification, accounting for USD 1,196.4 million in 2022. The market expanded at a considerable CAGR of 4.6% from 2017 to 2022.
The surging application of these units in the oil and gas industry is improving the growth in the market. The increasing establishment of crude oil storage tanks across the globe has surged the need for vapour recovery units. These tanks are used to hold oil for a brief period to stabilize the flow between production wells and pipelines.
End users are increasing the adoption of vapour recovery units to reduce the emission of light hydrocarbon and other volatile compounds. According to the United States Environmental Protection Agency (EPA), there are around 500,000 crude oil storage tanks in the United States.
Around 7,000 to 9,000 vapour recovery units are installed in the United States oil production sector. The increasing development of upstream and downstream projects is accelerating the adoption of vapour recovery units. Regionally, North America is expected to be the notable pocket in the global vapour recovery units market.
Stringent Environmental Laws for VOC Emissions to Boost the Vapour Recovery Units Sales
Surging upstream and downstream projects across the globe have increased the crude oil production and installation of storage tank vents in oil & gas and marine industries. As per the International Energy Agency (IEA), the global demand and supply for oil are expected to increase by 104.1 million barrels/day and 67.6 million barrels/day (mb/d) by 2026, respectively.
With the constant increase in upstream projects and oil & gas exploration activities, end users are increasing the installation of vapour recovery units. Due to strict environmental regulations limiting the emission of GHG and other VOCs, oil & gas and marine industries are aiming for ‘alternative methods’ to adhere to the norms.
According to the EPA, governments across several countries are aiming to reduce emissions by nearly 90,000 tonnes per year. Due to this, manufacturers, importers, and distributors are compelled to limit the VOC content of consumer products. Hence, demand for vapour recovery units is expected to surge in the oil and gas industry over the forecast period.
Surging Oilfield and Oil Storage Opportunities due to Increasing Energy Demand to Augment Growth.
The growing trend for clean energy sources and conflicting fuel prices has affected the oil and gas industry across the globe. In response to this, national oil companies, especially in the Middle East and Africa, and South America are strategizing to improve their economy in the context of the energy transition.
According to the National Oil Companies and Energy Transition, national oil companies in the Middle East and North America are investing in oil and gas projects while maintaining transparent and efficient management. Upcoming oilfield and oil storage opportunities in these regions are expected to provide growth opportunities for vapour recovery unit manufacturers over the coming decade. For instance,
This project is expected to hold around 50 billion barrels of oil equipment and the company is aiming to increase the production from the field by 1 million barrels per day by the end of 2024. A slew of such projects in these regions is expected to increase the installation of vapour recovery units to reduce VOC emissions.
Principal Consultant
Vapour Recovery Units Based on Membrane Separation Technology to Outpace the Sales of VRUs Based on Adsorption.
FMI opines vapour recovery units with membrane separation technology are expected to witness high demand over the forecast period. With cost-effective operational and installation costs as compared to other technologies, demand for membrane separation technology is anticipated to remain high. As Vapour Recovery Units (VRUs) based on membrane separation technology are easy to install and have straightforward usage, end users are opting for them extensively for upstream applications.
Membrane separation technology VRUs provide a high recovery rate and extensive reduction in maintenance costs. However, the sales of VRUs based on the adsorption principle are expected to surpass USD 1 billion by the end of 2028.
The condensation segment under technology is likely to garner substantial growth from 2023 to 2033. The condensation segment occupied 46.0% market share in 2022. The growth is ascribable to the advancements in condensation technology that have made it reliable, cost-efficient, and effective.
New condensation VPUs can handle a variety of vapour compositions and are equipped with improved control systems. They are also equipped with the best heat exchange mechanisms, which increases their overall reliability and performance. These factors are boosting condensation technology demand in the market.
Surging Production and Consumption of Oil to Increase the Sales of Vapour Recovery Units in Upstream Applications
In terms of application, marine loading and railcar loading are expected to register substantial growth over the forecast period. Growth in these segments is underpinned by the increasing consumption of crude oil in these sectors.
The increasing development of upstream projects across North America and the Middle East has improved the demand for VRUs in upstream applications. Subsequently, the high cost of these vapour recovery units upstream might drive the growth in the upstream segment.
The growing production of oil and increasing development in oil exploration units and refineries have aided the adoption of vapour recovery units in the oil and gas sectors. On the back of these factors, demand for vapour recovery units for oil and gas compressors is going to fuel the growth in the market. In 2022, the oil & gas compressors segment captured 39.6% of the market share.
| Segment | Technology |
|---|---|
| Sub-segment | Condensation |
| Market Share (2022) | 46.0% |
| Segment | End-use |
|---|---|
| Sub-segment | Oil & Gas Compressors |
| Market Share (2022) | 39.6% |
Development in Oil and Gas Industry to Propel Vapour Recovery Units Sales
As per Future Market Insights, Asia Pacific excluding Japan is expected to rank second in the global market of vapour recovery units. Increasing oil and gas exploration activities in India are expected to create incremental growth opportunities for vapour recovery unit manufacturers.
According to the India Brand Equity Foundation (IBEF), India is expected to be one of the \ prominent contributors to non-OECD petroleum consumption growth. India’s vapour recovery units market occupied 6.5% of the global market share in 2022. In 2021, the primary energy demand doubled to 1,123 million tons of oil equivalent and crude oil production, which is estimated to reach 4.9 million metric tons by 2025.
With increasing investment in oil storage and oilfield projects, the adoption of vapour recovery units is expected to surge in India by the end of 2028. For instance, in 2021, Oil and Natural Gas Corporation announced an investment of USD 4.03 billion to boost the oil and gas output. Such development in the oil and gas industry and stringent norms imposed by International Energy Agency and EPA are expected to augment the sales of vapour recovery units in India.
Surging Oil and Gas Exploration Activities to Fuel the Sales of Vapour Recovery Units.
Growing production and consumption of oil are resulting in a rise in the number of oil exploration units and refineries across the United States. Factors that are favouring the United States vapour recovery units market growth include:
Increasing greenhouse emissions and strict environmental norms across North America have compelled several organizations to adopt vapour recovery units and systems to adhere to their commitment to sustainable development.
As per FMI, North America is expected to contribute over 3/5th of the demand share in the global vapour recovery units market. With increasing oil storage opportunities and favorable stringent norms imposed by EPA, the United States is expected to dominate North America market. In 2022, the United States garnered 17.6% of the market share globally.
Development of Oil and Gas Companies in GCC Countries to Increase Vapour Recovery Units Adoption
Future Market Insights estimates, increasing upstream and downstream projects in the Middle East might provide remunerative growth opportunities for vapour recovery unit market players. Development of oil exploration activities in Kuwait, Qatar, and UAE are expected to increase the sales of vapour recovery units to reduce GHG and VOC emissions. For instance,
Onshore facilities due to this refinery are expected to receive 4.6 billion cubic feet per day of feed gas and 11,000 tons per day of LPG. Hence, with the company’s commitment toward sustainable development due to the increased production of oil and the reduction of the emission of ethane, the adoption of vapour recovery units is expected to increase.
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As per Future Market Insights, the global vapour recovery units market is expected to be fragmented in nature. The presence of numerous leading players in the market has intensified the competition, resulting in increased product launches.
Key players are also aiming for strategic mergers and acquisitions to expand their global presence. Meanwhile, tier-1 players are developing their sales channels and introducing advanced products to meet emission standards.
Recent Developments Observed by FMI:
| Attribute | Details |
|---|---|
| Forecast Period | 2023 to 2033 |
| Historical Data Available for | 2017 to 2022 |
| Market Analysis | USD million for Value |
| Key Regions Covered | North America; Latin America; Europe; East Asia; South Asia & Pacific; The Middle East & Africa (MEA) |
| Key Countries Covered | The United States, Canada, Germany, The United Kingdom, Nordic, Russia, BENELUX, Poland, France, Spain, Italy, Czech Republic, Hungary, Rest of EMEAI, Brazil, Peru, Argentina, Mexico, South Africa, Northern Africa, GCC Countries, China, Japan, South Korea, India, ASIAN, Thailand, Malaysia, Indonesia, Australia, New Zealand, Others |
| Key Segments Covered | Technology, Application, Process, End-use, Region |
| Report Coverage | Market Forecast, Company Share Analysis, Competition Intelligence, Trend Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives |
The vapour recovery units market is expected to be valued at USD 1,256.2 million in 2023.
The vapour recovery units industry registered a modest CAGR of 4.6% from 2018 to 2022.
The industry is expected to reach a valuation of USD 2,105.5 million in 2033.
The United States vapour recovery units market held a share of 17.6% in 2022.
Stringent VOC laws drive the vapour recovery units market growth over the forecast period.
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