Market Size and Overview:

In the year 2023, the Global Upstream Production Automation Market attained a valuation of $15.6 billion, with a forecast indicating its expansion to a market size of $21.52 billion by 2030. The anticipated growth trajectory for the market during the forecast period spanning from 2024 to 2030 suggests a Compound Annual Growth Rate (CAGR) of 4.7%.

Industry Overview:

The Upstream Production Automation Market is poised for a consistent Compound Annual Growth Rate (CAGR) during the forecasted period from 2023 to 2030. The industry is undergoing a digital transformation, marked by the widespread adoption of sensors globally, collecting data from rigs. Embracing digital technology facilitates enhanced collaboration between engineering teams and Upstream Production Automation firms, streamlining data management and project requirements. This, in turn, improves internal communication, simplifies plans, and optimizes overall workflow processes.

Automation in the Upstream Production Automation sector holds the potential to boost productivity and reduce costs. Post the Deepwater Horizon oil leak incident, the belief is that automation can significantly enhance the measurement of oil pressure and flow. Through smart sensors connected to centralized monitoring software, real-time reporting of pressure, flow, and oil levels can be achieved remotely. This allows rig crews to monitor and adjust settings as needed without a physical presence on-site, potentially reducing operational costs and enhancing efficiency.

The Upstream Production Automation industry stands to benefit from the deployment of Internet of Things (IoT) solutions, incorporating downhole sensors to surface control valves that transmit real-time data for analysis in boardrooms. This not only improves operational efficiency but also contributes to creating a safer working environment throughout the oilfield.

COVID-19 Impact:

The ongoing COVID-19 pandemic has produced various immediate effects, influencing the trajectory of numerous industries. While some sectors face a reduction in demand, others remain unaffected, exhibiting promising growth potential. The pandemic prompted the shutdown of numerous businesses, necessitating the departure of workers from industrial facilities. This circumstance underscored the importance of automation. However, as some facilities lacked the required infrastructure for automation, the market experienced a marginal contraction. Despite this setback, the Upstream Production Automation Market is anticipated to rebound in the coming years with promising opportunities.

MARKET DRIVERS:

Expansion of Automation Driving Growth in Upstream Production Automation Market

The escalating demand for automation is a key driver propelling the growth of the Upstream Production Automation sector. Automation has proven crucial, particularly in scenarios where human workers face challenges in maintaining consistent performance. Offshore Upstream Production industries, with their distinct operational environments, have witnessed substantial benefits from automation. Notably, automation projects have justified their worth by minimizing or eliminating production losses during evacuations caused by hurricanes. Automated platforms demonstrate the ability to sustain production for extended periods, yielding substantial cost savings. The integration of automation in the Upstream Production Automation industry is expected to be a profitable venture in the foreseeable future.

Cloud Computing Driving Growth in Upstream Production Automation Market

The Upstream Production Automation sector is poised to undergo an evolutionary digital transformation, driven by advancements in cloud computing, social media, big data, and analytics. Cloud computing, in particular, enhances business agility by breaking down barriers between corporate business function silos. The ability to analyze vast amounts of structured and unstructured data from multiple sources in real-time fosters innovation and provides valuable insights, thanks to big data and analytics.

MARKET RESTRAINTS:

Labour Shortage Restraining Growth in Upstream Production Automation Market

A significant challenge in the Upstream Production Automation industry is the time required to develop the necessary engineering skills to meet the diverse disciplines essential for typical industrial automation oil & gas projects. The shortage of qualified analyzer engineers, particularly at the Engineering, Procurement, and Construction (EPC) level and front-end engineering design (FEED), poses a concern. Adequate personnel with the requisite skills for operating process equipment and utilizing analytical tools are continually in demand, hindering the industry's growth.

Upstream Production Automation Market Segmentation – By Offering:

• Hardware
• Software
• Services

The Upstream Production Automation market is segmented based on offering into hardware, software, and services. The hardware sector has secured a substantial market share in terms of product offerings, while significant growth is anticipated in the software sector in the coming years.

Upstream Production Automation Market Segmentation – By Technology:

• Supervisory control and data acquisition (SCADA)
• Programmable logic controllers (PLCs)
• Distributed control systems (DCS)
• Machine execution systems (MES)
• Enterprise resource planning (ERP)
• Product lifecycle management (PLM)
• Others

The market is categorized by technology into supervisory control and data acquisition (SCADA), programmable logic controllers (PLCs), distributed control systems (DCS), machine execution systems (MES), enterprise resource planning (ERP), product lifecycle management (PLM), and other technologies.

Among these technologies, Distributed Control Systems (DCS) are expected to dominate revenue share in the forecasted years. DCS, functioning as a controlled architecture overseeing multiple integrated systems, is instrumental in managing localized processes, particularly in industrial applications such as oil and gas refineries and oil production. Key drivers for DCS adoption include the increasing use of renewable and nuclear energy resources for power generation and the promotion of the industrial internet of things (IIoT) for real-time decision-making. The flexibility to integrate various hardware solutions and support for both traditional and modern IoT-enabled devices further contribute to its comprehensive solution capabilities.

Upstream Production Automation Market Segmentation – By Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East and Africa

Cisco's projection of 50 billion IoT-enabled assets presents an opportunity for the Upstream Production Automation industry to capitalize on this trend. Operating in a dynamic global business landscape, the industry grapples with cost management, asset optimization, and uptime enhancement. Technological advancements fostering connected businesses play a pivotal role in achieving operational excellence, with the sector leveraging various automation technologies to optimize operations.

Upstream Production Automation Market Segmentation – By Company:

In the realm of social media platforms facilitating swift, direct, and cost-effective consumer interactions, and the advent of mobile technology unlocking new business avenues, businesses are set to access an expanded pool of data due to the declining cost of sensors and the rise of the industrial internet of things (IoT). Combining these technologies has the potential to significantly enhance their capabilities, ushering in a new era of linked intelligence in Upstream Production Automation operations. For Upstream Production Automation firms, big data and analytics, IoT, and mobile devices are emerging as top trends in the digital landscape, not only boosting productivity but also enabling more effective customer communication.

Key Companies in the Upstream Production Automation Market:

• ABB Ltd
• Honeywell International Inc
• Rockwell Automation Inc
• Mitsubishi Corporation
• Schneider Electric SE

Notable Happenings in the Upstream Production Automation Market in the Recent Past:

In July 2019, Emerson introduced two new Rosemount 628 Universal Gas Sensors, enhancing the existing capability to detect oxygen and carbon monoxide depletion. This expansion broadens the scope of scenarios monitored by the Rosemount 928 Wireless Gas Monitor platform, addressing a wider range of potential hazardous situations in the Upstream Production Automation sector.