Linde Electronics and Specialty Gases has made another investment in its vertically integrated neon supply chain, with the installation of a production facility at the group’s large ASU in La Porte, Texas.

The new production unit is part of a $250m investment in Linde’s La Porte site, and will add no less than 40 million litres of neon annually to these capabilities.

The timing of Linde’s investment in neon supply is particularly pertinent, given that the gas has been in unusually severe shortage in 2015/16.

A by-product of very large oxygen plants, neon has historically been in over-supply since its days as a strategic product for both the US and former Soviet Union (USSR) in the production of their respective high-powered laser weaponry.

According to gasworld business intelligence estimates, the industrial gas market of the South Western region of the US recorded revenues of just under $4.3 bn in 2015. The market is dominated by three Tier One companies; Praxair, Air Liquide and Air Products. Praxair was the market leader for 2015, but will lose its top spot to Air Liquide once the acquisition of Airgas impacts on revenues in 2016.

Linde is currently the fourth-largest company in the South West region of the US, with a market share of 13%. The company boasts an extremely developed onsite business, similar to the entire region, with onsite revenues accounting for 51% of total revenue in the South West.

Over the course of the last 10 years, industrial gas revenues in the South West have grown by roughly 3% per annum (p.a.).

Within the 2016-2020 timeframe, our forecast models predict growth from 0.4% p.a. in a low scenario to 2.2% p.a. in a high scenario. This should see the industry in the South West achieve revenues of between $4.5 bn to $5.1 bn by 2020.


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