TO STUDY THE GLOBAL MARKET SCENARIO AND ANALYZE NEW

APLLICATIONS OF INDUSTRIAL GASES

Dissertation submitted to the College of Management and Economic Studies for the partial fulfillment of
the degree of

INTG. BBA + MBA (OIL AND GAS MARKETING)

Guided By:
Faculty:
Prof. S.K POKHRIYAL
College of Management & Economic Studies,
University of Petroleum & Energy Studies,
Dehradun 248006
Submitted By:

AMAN SUD
R-430209005
500008005

College of Management and Economic Studies,

University of Petroleum & Energy Studies,
Dehradun, Uttarakhand, India
November, 2013

ACKNOWLEDGEMENT

I am honored to take this opportunity in expressing my deep sense of

gratitude to Prof. S.K. Pokhriyal for having spared his valuable time and
guidance which helped me throughout my research. He was a constant
source of inspiration during the study.

I am also thankful to the other teaching staff of University Of Petroleum

& Energy Studies without whose support and help, this project wouldnt
have been possible. It was only due to their guidance that this project could
be brought to this form in time and in an efficient manner.

(Aman Sud)

RESEARCH SUMMARY
This report depicts the global scenario of the industrial gas industry
with the patterns of their production, consumption and their demand.
This report covers the entire cycle starting from the production of the
industrial gases, the quality checks and standards which it should
comply with, the distribution channels, the HSE initiatives, and the sale
of the gases and finally, the application of the gases in the client
companies.
This report covers the applications in which industrial gases play a vital
role , Industrial Gases are used in a huge number of industries and
their applications are endless.
In order to understand the applications of the industrial gases, one has
to know the properties of the gas and then identify areas in which the
properties can be beneficial. The properties as well as the areas of
applications have been defined in this report.
The main purpose of this report is to throw light on newer possible
applications in which industrial gases can be used successfully,
profitably and commercially.
The roles of industrial gases as shielding gases in welding applications
have been highlighted in this report.

TABLE OF CONTENT
1.INTRODUCTION

RESEARCH OBJECTIVES
1. To study the Global Industrial Gas market scenario
2.

To analyze the pricing , demand and supply patterns of industrial gases

3.

To understand the uses of Industrial gases and the industries or areas it is used in.

4.

To study the business strategies of the top market leaders in Industrial gas industry.

5.

To find new areas in which industrial gases can be used.

To study the value chain of industrial gases involving production, transportation and distribution

INTRODUCTION
BACKGROUND
Industrial gases are a group of gases which are manufactured commercially
and traded for consumptions in other applications. The most common
industrial gases are:
A) Air Gases
1) Oxygen (O2)
By a big margin, the dominant oxidizing agent in petrochemicals
manufacturing is molecular oxygen. Compressed process air still figures as
oxidant for many oxidations, but as a rule the advantage belongs to
processes using pure gaseous oxygen (GOX) as oxidizing agent because
The candidate technologies are far more effective. For example, eliminating
the large amount of inert gases that must be transported through the

system with air oxidation results in a number of benefits: savings in

investment costs and resources leading to reduced environmental impact
can be achieved because of the possibility of using significantly smaller
apparatus, highly positive effects on selectivity in many cases and a
substantially smaller exit-gas stream. The last point alone often yields a
considerable saving in fuel and an associated reduction in CO2 emissions.
The use of supplemental oxygen frequently results in a substantial boost in
the productivity of an existing plant that employs air oxidation. In many
cases, corresponding oxygen enrichment of the process air, which
commonly can be realized with only minor effort, represents a very
promising way to intensify the process. Gains in capacity typically range
between 10 and 15 percent.
Such an increase in productivity can often be achieved by simply injecting
GOX into the process air ducting. The added equipment cost for this mode
of oxygen enrichment is comparatively slight.
All three options for oxygen supply dedicated on-site generation, liquefied
gas supply and pipeline network are used in petro chemistry.
The oxidation of liquid p-xylene to terephthalic acid, a key feedstock for
many polyesters, plays a major role in the petrochemical industry. In this air
oxidation process, oxygen enrichment is increasingly employed to boost
capacity. Most production units have capacities between100, 000 and
1,000,000 tons per year. Enriching the inlet air to25 vol. % oxygen thus calls
for several million Nm3/year of oxygen capacity. Among the salient effects
that come with additional use of GOX is a capacity increase of more than 20
%.
A variety of heterogeneous gas-phase oxidations are candidates for the use
of technologies with gas recycle where only GOX is employed as oxidizing
agent. The highly advantageous setting here in comparison to processes
without gas recycle, which normally involve the use of process air means in
particular a much-increased product selectivity and substantially less offgas. Today, with hardly an exception anywhere in the world, the processes
employed for oxidation of ethylene to produce ethylene oxide and vinyl
acetate make exclusive use of GOX. Processes with gas recycle also hold
great interest for the oxidative chemical treatment of light saturated
hydrocarbons or fuel grade feedstocks.
Such processes have already been implemented on an industrial scale, as
for example in the oxidation of ethane to acetic acid.

High purity, typically over 99 %, is required in most cases when using GOX
in recycle processes, in order to prevent inert gases such as argon building
up in the recycle stream.
2) Nitrogen (N2)
Nitrogen is the gas most commonly used in the chemical industry.
Because of the remarkable inertness of diatomic nitrogen, there are just
a few instances in which it serves as a reactant, as in the production
of ammonia. As a consequence, it serves to protect equipment, ensure
product quality, perform cooling tasks and provide industrial services.
Other applications include the conveyance of solid bulk material such as
powders and the preparation of catalysts.
In the petrochemical industry, the main uses of nitrogen are in inerting
procedures as well as industrial services. Sometimes, gaseous N 2 (GAN)
is admixed with other gases as a diluent, for example with H 2 for hydrogenation
purposes, as in the purifi cation of crude terephthalic acid. H 2/N2
gas mixtures are often used for activation of catalyst material, notably
for hydrogenations.
Cryocondensation, where gases are cooled by cryogenic liquid nitrogen
(LIN), may become more important in future. A typical cylinder-based N 2
application is its use as an inert gas for analytical procedures, for example
as a carrier stream in gas chromatography.
Inerting
The purpose of inerting is to displace (atmospheric) oxygen, moisture or
combustible gases with an inert gas. This task is most often performed
with nitrogen, only occasionally with carbon dioxide, either to afford
safety or to protect products.

3) Argon (Ar)

B) Rare Gases
1) Helium (He)
2) Krypton (Kr)
3) Xenon (Xe)
4) Neon (Ne)

C) Other Industrial Gases1) Hydrogen (H2)

In many cases, hydrogen (H2) applications in petrochemical processing call
for large quantities of hydrogen which normally are sourced from syngas
production. Alternatively, H2 can be supplied by electrolysis of aqueous
solutions or by treatment of hydrogen-rich off-gases, such as those arising,
for example, in petroleum refineries or in plants producing styrene

monomer. Complex production clusters built recently tend to consume more

H2 than some of their various processes, such as platforms, are producing.
This situation is mainly due to regulations calling for the production of
clean fuels, especially originating from desulphurization requirements.
Present H2 sourcing options rank considerably lower than syngas in terms of
the quantity of H2 produced or recovered.
A key requirement for H2 generation is reliably steady product quality,
which depends mainly on two factors: Catalyst performance in steam
reforming, the predominating technology for H2 production (in particular,
catalyst poisons, such as S-containing compounds, must be minimized in
the feed). Minimization of impurities and by-products in the H2 product to
meet the demands of the processes supplied with this gas. Accordingly, the
content of CO has to be kept very low in some hydrogenation processes, e.
g. below one ppmv.Normally, H2 is delivered as a compressed gas by
cylinders, trailers, on-site production plants or via pipeline (in the last case
at 60 bar, for example); the purity routinely ranges up to 99.999 %. Which
option is chosen depends heavily on the quantity and quality required and
on the plant location [15]. Besides CO, the main impurities are nitrogen,
oxygen and water. Appropriate purification treatments, such as catalytic
combustion to eliminate oxygen, are employed.
2) Carbon monoxide (CO)
Carbon monoxide fi gures as a reactant in many industrial chemical
syntheses [9], such as:
3 Manufacture of phosgene
3 Production of acetic acid by carbonylation of methanol
3 Production of acetic anhydride by carbonylation of methyl acetate
or dimethyl ether
3 Oxidative carbonylation of methanol to dimethyl carbonate
Actually, CO also plays a role in complementing well-established technologies.
For example, methyl methacrylate monomer is produced
mainly from hydrogen cyanide and acetone, but a novel two-stage synthesis
route involving ethylene, methanol and formaldehyde as starting
materials along with CO is becoming competitive. One production plant
of this type is now being erected in Singapore and expected to come
on stream in 2008 [19].
Petrochemical processing normally uses large quantities of CO, generally
produced by on-site plants (see fi g. 6). A few chemical complexes
have pipeline networks to supply the gas to various processes. Production
capacities often range up to 30,000 Nm3/h. For minor demands,
such as in laboratories, CO is normally delivered as a compressed gas.
The properties of carbon monoxide it is highly toxic, combustible,
colourless and odourless mean that stringent safety requirements
govern its shipping, storage and handling.
Fig. 6:

3) Carbon dioxide (CO2)

Carbon dioxide (CO2) is a colourless, stable, noncombustible gas. Compared
to N2, the heavier CO2 is not as chemically inactive and accordingly
fi nds only limited use as an inerting gas in petrochemical applications.

As CO2 is an acid, it reacts with bases such as ammonia or carbanions.

It can moreover be used for reaction or co-polymerisation with epoxides.
But overall, CO2 serves as a building block for only a few chemical
reactions.
Including other purposes, however, such as product formulation or
industrial services, CO2 covers a wide variety of applications.
The gas is used as:
A component for chemical syntheses such 3 as the production of urea,
organic acids (e. g. hydroxybenzoic acids such as salicylic acid) and
cyclic and polymeric carbonates [20]
3 A feed for CO production, especially if H2 is available (see equation (4))
3 A reagent for neutralisation of aqueous fl uids with too high pH (often
replacing sulphuric acid in this function)
3 A solvent (in the supercritical state), as in the production of fl uorinated
polymers
3 A foaming agent in production of voluminous polymers
3 An inert gas mainly for blanketting, as it is heavier than air
3 A fi re extinguishing agent
As a solid i. e. dry ice - CO2 is used as:
3 A coolant
3 A surface cleaning agent (especially in dry ice blasting applications,
where accelerated CO2 pellets are used, for example, in maintaining
heat exchangers or pipelines)
As CO2 is a greenhouse gas (human activities account for the generation
of more than 20 billion tons per year [20]), efforts are made not only
to minimise output but also to discover new potential uses. Such novel
applications have been found in the fi eld of resource opening such as
enhanced oil recovery (EOR), where CO 2 reduces the viscosity of in-situ
oil deposits for facilitated recovery. In petrochemistry, however, bulk
uses of CO2 are not easy to fi nd, even when the various options of reduction
to carbon monoxide (including the Boudouard equilibrium and
the Calcor process) are considered [21]. Many efforts to exploit the
useful properties of CO2 as a supercritical solvent have not yet led to a
major breakthrough in the production of commodity chemicals. Another
interesting approach for bulk use of this gas seems to be the dehydrogenation
of saturated hydrocarbons where CO2 could have potential as
a supporting oxidant (see e. g. [22]). Such an application, however, does
not appear to have been commercialised yet.

4) Nitrous oxide (N2O)

5) Chlorine (Cl2)
6) Hydrogen chloride (hcl)
7) Sulphur dioxide (SO2)
8) Acetylene (C2H2),
Acetylene, an endothermic compound which is energetically costly to
produce, was long ago supplanted by ethylene as a C2 source for basic
chemistry. Steam crackers producing ethylene also generate acetylene
as a by-product. As a rule, the acetylene is hydrogenated to ethylene as
part of the process, but at a few crackers it is isolated by gas scrubbing
and thereby recovered as a vendible pure gas fraction. Acetylene is also
obtained by pyrolysis of a wide range of hydrocarbons such as methane
or crude oil and, not least, by hydrolysis of coal-based calcium carbide.
A very large amount of energy is stored in the acetylene molecule.
This, along with other properties of the gas, calls for careful handling in
accordance with regulations. For major demand, as common in petrochemistry,
the gas can be delivered by pipeline from a nearby generation
plant.

9) Methane (CH4)

10) Propane (C3H8).

Syngas
Synthesis gas (syngas), a mixture of hydrogen and carbon monoxide (CO), is
not only the most important source for the production of pure gases, but it
is also quite important as a building block for chemical syntheses.
For example, synthesis gas is the main feedstock for the production of
methanol, which in turn is or can be the starting material for the
manufacture of the following products, e. g.:
-Formic acid
- Acetic acid
- Formaldehyde
-Dimethyl ether or methyl tert-butyl ether
- Hydrocarbons such as olefins
- Hydrocarbon mixtures for fuels (such as FAME,i. e. fatty acid methyl ester)
Because of the wide range of possible applications for methanol, its
potential in terms of a methanol-based economy beyond oil and gas is now
under discussion [10].In addition, the following process classes involving
syngas are industrially important or becoming so:3 Oxo synthesis or
hydroformylation of alkenes to make aldehydes, from which products such
as alcohols and carboxylic acids are easilyobtained3 Fischer-Tropsch
synthesis of higher hydrocarbons, such as transport fuels
In this field, presently the conversion of biomass to liquid (BTL) is of high
interest; e. g. in Germany, a pilot installation for gasification of biomass is
being installed where various feed options can be tested. There also are
many diverse combinations of these and other gases to meet the
requirements of precise applications.
The industrial gases industry, attends to a very large number of customers
in the entire community. Industrial gases are vital for most of the
manufacturing operations. Large amounts of oxygen, nitrogen and argon are
used in the metal and steel industry. Marine and the automotive industry
use - acetylene, propane, mixtures of fuel gases and oxygen for cutting and
soldering. Liquid nitrogen is important for recycling of plastics, packing and
scrapping of tires. The chemical industry uses most of the major industrial
gases as raw materials for inerting. The smaller market segment consists of
cylinder gas and mixtures.

INDIAN INDUSTRIAL GAS SCENARIO

Coming over to India, there are currently approx. 300 small & medium size
plants and approx. 25 large tonnage plants in the country. These industrial
gases are supplied through the pipelines to captive customers in nearby
factories; through transportation by cryogenic tanks for bulk deliveries to far
away customers; or through cylinders.

The up-to-date yearly turnover of the gas industry, not including captive
production is around Rs. 3,000 crores, i.e. ($650 million). With greater than
before industrialization, the demand pattern of industrial gases is also
changing fast.
#Modern applications in the food processing industry, agriculture industries,
healthcare and technology are increasing at an incredible pace. This has
compelled the industry to adopt strict quality control systems and an
effective distribution system.

Major players in India include

1) INOX Air Products Ltd.
2) BOC India
3) Air Liquide India Holding Pvt Ltd.
4) Jindal Praxair Oxygen Co. Ltd.
5) Aims Industries Ltd etc.

The Indian gas industry is increasing at an average rate of 12 per cent per
annum since the last couple of years, with the industrial oxygen growing
consistently at 15-17 per cent per annum.
The growth of industrial gas industry can be easily predicted on the basis of
estimates of the steel and other metallurgical industry. The demand for steel
is seen increasing by 10% in the financial year to march 2013, aided by
higher expenditure on infrastructure will remain to drive the growth of the
gas industry. Natural gas consists of 9 % of India's total primary energy
consumption and it will rise to 18% of energy mix by 2015.

The demand for natural gas is also likely to grow at an average yearly
growth rate of 7.3%.Metals manufacture and fabrication will continue to be
the major market for industrial gases, accounting for approx.31% of overall
demand in value terms in approaching years.
The second biggest market will be the chemical processing/petroleum
refining sector. The medical/healthcare market, although smaller in size, will
be the fastest budding and will expect record gains from the growth of
healthcare services in developing nations and the fast increasing use of
home healthcare respiratory treatments in innovative economics.
Hydrogen is getting importance and most companies are endeavoring to
develop technologies that can proficiently exploit the potential of hydrogen.
Increased use of natural gas will generate an opening for greater production
of argon and carbon dioxide. The Industrial gas industry has a very positive
future in the upcoming years.

Industrial gases fi nd use in almost every modern manufacturing process.

Prominent among gas-using sectors is the chemical industry, where the field
of petro chemistry, or petroleum products chemistry, is most important in
terms of not only quantities used but also generation of industrial gases.
The term petro chemistry in this paper refers to the field of chemistry
concerned with processes for making basic chemicals from petroleum
refinery products, natural gas and synthesis gas.
In concrete terms, it comprises technologies for making and processing
3 Paraffi nic hydrocarbons
3 Mono and diolefi ns
3 Cycloalkanes
3 Aromatic hydrocarbons
In this field, industrial gases are mainly needed
3 As reactants
3 To afford safety
3 To protect the environment
3 For industrial services
The quantities of gas required range widely, from less than 1 to over
100,000 Nm/h. Specified purities also vary greatly from application to
application, with values from 90 to 99.9999 vol. %

.
The requisite quantity and purity govern both the production process
selected and the form in which gases are delivered (cylinders, cylinder
bundles, liquefied-gas tank trailers, near-by production plants such as onsite plants when dedicated to the corresponding process). The gas industry
offers diverse manufacturing processes and a wide spectrum of delivery
forms to the petrochemical industry .

ENVIRONMENTAL IMPLICATIONS
Gas production is largely an extremely environmentally-friendly industry.
With the exception of acetylene and hydrogen production, the processes
concerned produce no waste.
In acetylene production the waste produced is lime, which creates a small
disposal problem, but most of it is used in water treatment. The only waste
in hydrogen production is oxygen, which is naturally present in air and so
does not create a problem.
When the gases are used, again there is little environmental damage.
Nitrogen, oxygen and argon are simply different fractions of air, so returning
them to the air has no detrimental effect.
Hydrogen is also present in air, and is harmless. Carbon dioxide and
acetylene (which is burnt, giving off carbon dioxide and water) are of more
concern, but still do not cause serious damage. Any carbon dioxide that
doesn't form into dry ice pellets is recycled on site.
The only two areas of concern are energy consumption and the use, of large
volumes of cooling water.

LITERATURE REVIEW

The Global Industrial Analysts Inc. published a complete international report

on Industrial and Specialty Gases market. According to this report, the
international market for industrial and specialty gases is predicted to reach
11 Trillion Cubic Feet by the year 2017, aided by excellent growth
opportunities in electronics, healthcare and energy areas, and the rewarding
prospects in the developing markets of the Asia-Pacific region placing
special prominence on India and China.
The report suggests that the industry currently is concentrating on the
growth of new environment friendly technologies and products which are
likely to open innovative application markets for industrial gases.
The Linde group , which is arguably the global market leader in the
Industrial gas segment released a report describing the types of industrial
gases produced, the process and equipments involved in their production
as well as their uses. According to the report, Industrial gases are produced
mainly by air separation, i.e, extracted from the air. A few examples of
gases created in this method are nitrogen, oxygen, argon, and other rare
gases. However, few gases, inclusive on hydrogen, acetylene, and carbon
dioxide, are by-products of other processes. The global market for industrial
gases is around $40 billion a year, with the U.S. only at $13 billion. U.S is
presently the largest market in Industrial gases.
This report mainly focuses on the gases that are produced and sold by the
Linde group and have given inadequate information about the other
industrial gases. Furthermore, with the advancement in technology, the
method of production may also be subject to changes.
bcc report on industrial gas market dated 27 February 2013 described the
use of oxygen and nitrogen in the metal and medical segment of industrial
gas market and predicted the growth in demand of these gases with the
advancement in technology.
The article has made predictions with 2017 as the target. It describes the
changes in industrial gas distribution that could happen in the future, it also
stresses on the growth of this industry in the asia pacific region.
The report fails to explore the emerging fields where industrial gases can be
used due to the advancements in technologies; it focuses mainly on
forecasting the increase in demand of industrial gases in the existing fields.

In 2016, the global industrial gases market is projected to have a value of

$98.8 billion, an increase of approx. 55.2% since 2011.
One of the major strong point of the industrial gas industry is that it does
not rely on one or two major markets . The sectors, which rely on industrial
gases to produce their final products or services, account for more than 50%
of the overall global GDP.
The industrial gases industry serves a very large number of customers. They
are essential for virtually all manufacturing. Large amounts of oxygen,
nitrogen and argon are used in the metal and steel industry. Marine and the
automotive industry use propane, acetylene, mixtures of fuel gases and
oxygen for cutting and welding. Liquid nitrogen is important for recycling of
plastics, packaging and scrap tires. The chemical industry uses most of the
major industrial gases as raw material or for inerting. The smaller market
segment consists of gas cylinders and mixtures.
With the expansion of modern industries, the demand for industrial is
certainly to going to rise .
Furthermore, with advancement in technologies, many new areas are
opening up which would require industrial gases for their operations.

RESEARCH METHODOLOGY
RESEARCH DESIGN
For this Research, A mixture of Exploratory and Descriptive research design will be used in order to have an indepth knowledge about the Industrial Gas industry and its various associated industries and also to generate
necessary knowledge which can be used future studies about the new applications of industrial gases.
Descriptive research design is an effective technique for researching detailed subjects and acts as an initiator to
more quantitative studies. While there are some debatable concerns about the statistical validity of this research
types, as long as the boundaries are understood by the researcher, this kind of study is an invaluable scientific
tool.

The whole process including the production, purification, transportation and distribution of industrial gases will
be observed and described under this research.

SAMPLING DESIGN
Judgmental type of sampling will be used in this research.
According to judgmental sampling, elements will be selected on the basis of a set group of criterias as well as
the judgment of senior experienced professionals from the industry. For this research, the criteria for selecting
the industrial gas companies will be geography, market share .
For the second part of the research, that is to find new applications of industrial gases, the elements will be
selected on the basis of the application of industrial gas.

DATA COLLECTION
PRIMARY DATA COLLECTION
The Primary Data for this research has been collected by interviewing people associated with the industrial gas
industry.
Data has also been generated through a 2 month summer internship at Emirates industrial gas company, Dubai.
SECONDARY DATA COLLECTION
The Secondary Data for this research has been gathered from previous Dissertations , newspaper and magazine
articles and from verified and reliable sources from the internet

FINDINGS
CONCLUSIONS
In years to come, the petrochemical industry will see the effects of
thefollowing trends:
Intensifi cation of petrochemical processes including those in the
industrialised countries, e. g. higher capacities, fewer production
steps, enhanced product selectivities
3 Construction of large new petrochemical complexes in the newly
industrialising countries

3 A shift of production sites from Europe and North America toward

market areas and locations with sources of fossil feedstocks
3 I ncreasing employment of renewable feedstocks and use of
biotechnological
production processes
3 I ncreasing use of coal, oil sand resources and light hydrocarbons also
as a chemical feedstock
3 Optimisation of production units with respect to energy conservation
and reduction of CO2 footprint
3 More and more stringent environmental protection standards also in
developing countries
These changes will also affect the use of industrial gases. For example,
larger and more energy-effi cient gas generators will come into service.
The demand for individual gases will also show differential growth, with
the greatest anticipated potential in the demand for hydrogen and
oxygen (by total replacement of air or oxygen enrichment). The world
demand for gases in petrochemistry is expected to grow most of all in
the newly industrialised and developing economies.

LIMITATIONS
SCOPE FOR FURTHER STUDIES
REFERENCES