The global pipeline security market is predicted to grow at a compound annual growth rate (CAGR) of 6.79% to attain a market size of US$11.803 Billion by the end of the analysis period, 2026. The market was valued at US$7.451 Billion in 2019. Pipeline Security is concerned with the protection of pipelines that are highly used for commercial purposes for transporting natural gas, refined products, crude oil, water, chemicals, etc. to states and beyond borders. Pipeline Security has become a necessary concern due to increasing illegal tapping, sabotaging, and the risk of terror attacks. Based on solutions provided by the security company, the pipeline security market is segmented into surveillance solutions, intrusion detection solutions, tracking solutions, identity access control solutions, and secure communication.
Increasing Demand for Oil and Natural Gas Is Expected to Drive the Market:
With the increasing population, the demand for oil and natural gas is also expected to rise in the coming years. To meet the demand of the rising population the government must ensure undisrupted supply chains. With this, the role of pipelines comes to light. For instance, as per Empower AFPM, the US Department of Transportation Data shows that pipelines are the safest mode to transport oil and the recent data suggests that 99.999997% of the crude oil and gas are safely moved through these pipelines. Pipeline Companies ensure the safety of the structure from the beginning stage itself which includes designing, planning, construction, operation, and inspection. They continuously monitor the performance and engage with the governments and local agencies to improve its safety at every step. With the increasing environmental concerns, the demand for natural gas is also expected to rise in the coming years and all these factors together are expected to contribute heavily to the Pipeline Security Market.
Use of AI and IoT:
With digitalization, the application of the Internet of Things and Artificial Intelligence is expected to play a key role in pipeline security. Pipeline companies are using advanced technology including edge computing, data analytics visual inspection through drones, electronic monitoring through control rooms, sensor detections, vibration detections, etc. to ensure the safety of the pipelines. Multi-sensor data integration along with AI and edge computing are used to detect and alert the authorities about corrosion, damage, leaks, etc. AI is also being deployed to recognize different vibration patterns through three-dimensional vibration patterns that generate alarms if something comes across pipelines. For instance, recently Stellar Cyber has announced that it has won the 2021 Pipeline Innovation Award for introducing innovation in the security of pipelines. The company’s open XDR Platform analyzes data and provides security through its sensors to deliver a 360-degree view of the infrastructure.
Also, the SCADA (Supervisory Control and Data Acquisition) software is expected to witness significant growth in the coming years and is expected to play a key role in the development of the pipeline security market. SCADA software help industries and organization to personally control and monitor the process and gather real-time data and information. SCADA software in pipeline security is expected to play a key role as it can instantly alarm and notify the authorities in case of an intrusion or attack. With the facility of monitoring the site from a long distance, SCADA software provides a solution to check internal and external threats to pipeline infrastructure.
Increasing Cybersecurity Attacks and Terrorist Threats:
The increasing concerns regarding cybersecurity attacks and terrorist threats have become a major security concern especially in the high-conflict countries and are expected to drive the pipeline security market in the coming years. According to Global Terrorism Data in 2019, there were nearly 8500 terrorist attacks around the world that killed more than 203,000 people. The governments are spending huge funds to prevent such attacks and provide safety to the pipelines. Also, the increasing cyber-security attacks registered a global average cost of a data breach USD 3.86 million in 2020 is a major threat and is expected to play a key role in the market development. Due to the increasing threats, surveillance solutions and secure communications are expected to hold a key market share in the segmentation based on solutions.
Huge Installment Cost is a Major Restraint to the Market:
The huge installation costs associated with the pipelines, security maintenance costs, etc. are some of the restraints to the growing market. According to Global Energy Monitor, 2015-16 US gas pipeline projects registered an average cost of $7.65 million/miles which was higher than that registered in the previous years. Manpower costs, monitoring systems, installation of software and Artificial Intelligence, etc. are some of the key factors that determine the cost of the overall project, infrastructure, and security maintenance in turn.
Besides that, another major restraint to the market is the degradation of productive land. The installation of pipelines and security systems needs large underground access that often causes inconvenience to the farmers and landowners because this activity leads to huge-scale land degradation. This, in turn, hampers the production capacity of the land and makes it unfit to be utilized for the next coming years as well. This factor is also expected to hinder market growth in the coming years.
Coronavirus Pandemic Analysis:
The analysis report also provides a deep study about the impact of the coronavirus on market for pipeline security, stating how the lockdown, lack of labor, stringent curfew regulations by the government, export barriers, and employment have impacted the pipeline security market. With the shift in focus of the government towards handling the pandemic, the market did suffer a slowdown. The pandemic resulted in the slowing down of production, shutting down of industries which led to a fall in demand for pipeline security thus negatively impacting the market. But with the industries back in production, the pipeline security market is expected to bounce back in the coming years with the greater need to ensure security and safety.