DUBAI, United Arab Emirates, Dec. 11, 2014 /PRNewswire/ -- Continued investment in new oil and gas as well as power generation projects is accelerating the need for nondestructive testing (NDT) inspection services in the Middle East and North Africa. Despite pressure on global oil prices and fears of a slowdown, the Middle Eastern oil and gas industry is expected to remain robust, offering immense growth opportunities for the NDT inspection services market.
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New analysis from Frost & Sullivan, Beyond BRIC -- Strategic Analysis of the Middle East and North African NDT Inspection Services Market, finds that the market earned revenues of USD 796.4 Million in 2014 and estimates this to reach USD 1,310.9 Million in 2019. The Kingdom of Saudi Arabia will be the biggest market and grow at a compound annual growth rate of 11.6 per cent over the next five years.
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The Brent crude oil price, against which the Middle East and North African countries benchmark their oil industry, has remained high since 2011. As a result, oil and gas companies have earned significant revenue and duly invested back in infrastructure development.
"A number of new construction projects were announced between 2012 and 2014, benefitting the NDT inspection services market since an average of one percent of the cost in any new construction project can be attributed to NDT inspection," said Frost & Sullivan Measurement and Instrumentation Senior Research Analyst Nikhil Jain. "In addition, the growing focus on safety in the oil and gas industry is driving the demand for NDT inspection services in Middle East and North Africa."
An important trend in the market is the increasing competition based on price. The influx of Korean and Indian NDT inspection service providers has caused average prices to decline to historically low levels, affecting profits. For instance, companies such as S&K Engineering, Samsung Engineering and Hyundai Engineering have recently won contracts for mega construction projects by quoting extremely low prices. To maintain a healthy profit margin, they then source products and services from less expensive Korean companies.
Educating customers on the importance of quality over price will be vital to succeed in this competitive market. Participants must also explore the possibility of providing advanced NDT services to offset low profit margins.
"Competition in the advanced NDT services segment is far lower than for conventional services," noted Jain. "Hence, service providers offering sophisticated solutions can charge a premium and boost revenues in the Middle East and North African market."
Beyond BRIC -- Strategic Analysis of the Middle East and North African NDT Inspection Services Market is part of the Test & Measurement Growth Partnership Service program. Frost & Sullivan's related studies include: Global voice over LTE (VoLTE) Testing and Monitoring Market, Global LTE-Advanced Test Equipment Market, Analysis of Global NDT Equipment Market, Analysis of Global NDT Training Services Market, Emerging and Non-traditional NDT Equipment Market, and Analysis of Global Ultrasonic NDT Equipment Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
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Beyond BRIC -- Strategic Analysis of the Middle East and North African NDT Inspection Services Market
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Contact:
Paroma Bhattacharya
Corporate Communications - Middle East and North Africa
P: +91.22.6607 2047
F: +91.22.2832 4713
E: paromab@frost.com
Ravinder Kaur
Corporate Communications - Middle East, North Africa and South Asia
P: +91 44 6681 4413
F: +91 44 2431 4264
E: ravinder.kaur@frost.com
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