With respect to markets which have economic strength, coupled with positive CO2 growth opportunities, this would include the so-called ‘BRIC’ countries – those being Brazil, Russia, India, and China.
New CO2 plants are going into most of these countries, as well as other Asian countries over the next year ahead.
Furthermore, these countries are subject to CO2 market growth of up to 3%, or even greater; some indications of up to 5% per annum have been indicated for 2010 and into 2011 – this is non oil and gas usage.
Much of this strength is a function of new production rising from feed gas plants being expanded and changes in the industries and general manufacturing growth, for example.
In one such example, sugarcane involves perhaps the most efficient form of ethanol production, since there is no intermediate step for sugar conversion (from corn or grains) as with the first generation ethanol; so this is the case for Brazil, and some of the Asian nations.
Furthermore, the manufacture of many consumer goods, plus food processing and other products which use CO2, will be on the upswing in China primarily, and then India. These countries are growing powerhouse nations for manufacturing, particularly China, and CO2 demands will strongly grow. There is growth in the merchant markets in Latin America, so 1% or a little more is possible for much of Latin America.
As for other regions of the world where the oil patch is relevant, that being squeezing out the oil from partly depleted fields, enhanced oil recovery (EOR) will be a factor, this includes North America, Russia, the Middle East, and other world markets. However, in the case of EOR, sourcing is different via unrefined/less refined product due to flooding oilfields with CO2 rather than consuming it in food products, for example.
Furthermore, natural gas production from shale formations, such as those noted in the US is planned. Should natural gas be produced from shale formations in North America, particularly in the US, it is estimated this gas would be a sufficient form of energy for many decades to come, thus producing a high level of self-sufficiency compared to imported oil used in many cases, and less coal usage in power plants.
So natural gas production is often achieved via CO2 in many well stimulation or ‘frac’ applications – and today for example, the US and other North American and Latin American regions are noticing much more CO2 used for this purpose.
2010 and beyond
We can say that throughout the Euro Zone, the market will be flat for the year ahead, and possibly two years; and the same is relevant for the US; this is in terms of the merchant, non-oil & gas markets.
The flat status will take a positive turn as we slowly pull out of the recession, and see real stabilisation, and by all means the CO2 merchant markets will see positive growth, but probably not for the next year or even two for these large economic regions. The exception (Euro Zone and US), as noted above, would be oil & gas production, where CO2 is an agent in EOR and gas well stimulation.