Industrial gas is a group of gases that are commercially manufactured and sold for uses in other applications. The most common industrial gases are:air gases - oxygen (O2), nitrogen (N2) and argon (Ar) rare gases - such as helium (He), krypton (Kr), xenon (Xe) and neon (Ne) and other gases like hydrogen (H2), carbon monoxide (CO), carbon dioxide (CO2) and nitrous oxide (N2O) ,chlorine (Cl2), hydrogen chloride (HCl) and sulphur dioxide (SO2) ,acetylene (C2H2), methane (CH4) and propane (C3H8).

In addition, there are many different mixtures of these and other gases to meet the needs of specific applications. The industrial and medical gases industry serves a very large number of customers in the whole community. Industrial gases are essential for almost all manufacturing. Large quantities of oxygen, nitrogen and argon are used in the steel and metal industry. Shipyards and the automotive industry use acetylene, propane, mixtures of fuel gases and oxygen for cutting and welding. Liquid nitrogen is vital in recycling plastics, packaging and scrap tyres. The chemical industry employs all major industrial gases as a raw material or for inerting. The other smaller market segment consists of cylinder gas and mixtures.

In India, there are presently over 300 small & medium size plants and approximately 25 large tonnage plants all over the country. These gases are supplied through pipelines to captive customers in adjacent factories; in cryogenic transport tanks for bulk deliveries to long distance customers; or filled in cylinders.

The present annual turnover of the gas industry, excluding captive production is about Rs. 3,000 crores ($650 million). With increased industrialization, the demand pattern of industrial gases is also changing fast. Modern application in the food processing industry, agro industries, healthcare and technology are growing at a tremendous pace. This has driven the industry to adopt stringent quality control systems and an efficient distribution network.

Major players in India include BOC India, INOX Air Products Ltd., Jindal Praxair Oxygen Co. Ltd., Air Liquide India Holding P.Ltd., Aims Industries Ltd etc.

The Indian gas industry is growing at an average rate of 12 per cent per annum during 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 forecast on the basis of projections of the steel and other metallurgical industry. Steel demand is seen rising by 10% in the fiscal year to march 2011, helped by higher spending on infrastructure will continue to drive growth of the gas industry.

Natural gas comprises 9 % of India's primary energy consumption and it will be 14% of energy mix by 2010. Demand for natural gas is also likely to increase at an average annual growth rate of 7.3%.Metals production and fabrication will continue to be the largest market for industrial gases, accounting for 31% of total demand in value terms in coming years. The second largest market will be the chemical processing/petroleum refining segment. The medical/healthcare market, though smaller in size, will be the fastest growing and record gains from the expansion of healthcare services in developing nations and rapidly increasing use of home healthcare respiratory therapies in advanced economics.

Hydrogen is gaining prominence and most companies are striving to develop technologies that can efficiently exploit the potential of hydrogen. Increased use of natural gas will create an opportunity for higher production of argon and carbon dioxide. The Industrial gas industry has a very bright future in the coming years.

How to prepare a Project Report on Industrial Gases Projects?

When you are preparing a project report on industrial gas, you need to have full knowledge of the industry. It is necessary to familiarize both global and local trends in the industry. Such trends include:

• Gas market size
• Future of the gas industry
• Gas market drivers
• Legal requirements for oil, gas, and minerals
• Raw materials, equipment, and human resource requirement
• Financial requirements

Industrial Gas Market

The industrial gas market grows by about 6.9% annually. The largest global consumer of industrial gas is the Asia Pacific. One of the drivers of industrial gas market growth is the steady growth in industrial markets in India and China.

India has over 300 small-scale and medium gas manufacturers, with over 25 large-scale industrial gas and industrial gas cylinder manufacturers. The demand for industrial gas increases proportionally with an increase in the level of industrialization.

Other drivers of the industrial gas industry include modern applications of industrial gas in:

• Food Processing Industries
• Agro-based Industries
• Healthcare and Technology

All these sectors are on a growth trend. The growth in these sectors has raised the need for the industrial gas sector to embrace strict quality control systems and efficient gas distribution mechanisms.

The average annual growth rate for the Indian industrial gas market is about 12%. Similar to global trends, the demand for oxygen in India grows at 15 – 17% p.a. 

Considering the steady growth in the steel and other metal industries, the future demand for industrial gas is still promising. Metal production and fabrication are the largest markets for industrial gases. There is also a rapid growth in the medical field, suggesting continuous demand for oxygen by these sectors.

Things to know while preparing a Feasibility Study report on the Gas Industry

There are various things that you need to know while preparing a feasibility study report, these are-

1. What is a Feasibility Study?

A feasibility study report on the gas industry is usually a continuation of the pre-feasibility study. You only do a feasibility study if the pre-feasibility study gives your project idea a feasibility approval.

2. What is the objective of a Feasibility Study?

Assume you thought of a business idea in nitrogen gas production. To determine whether such a project has a chance to survive under the currently prevailing circumstances, you did a pre-feasibility study. The pre-feasibility study report suggests nitrogen manufacturing is a viable business.

Knowing that an investment in nitrogen can survive the market does not give you a justifiable reason to put your money in nitrogen gas. You need detailed information about it that can help you clarify and address concerns about the industrial gas product.

In summary, as a prospective investor in industrial gas, you need to prepare a feasibility study report on the gas industry to make a final decision about investing in the sector.

3. What does a Feasibility Study contain?

The feasibility study report consists of:

• Technical project feasibility.  It considers the required facilities, the suitability of gas production technology, site suitability, and raw materials.
• Financial feasibility. This feasibility study considers the comparative costs of different industrial gas alternatives.
• Managerial feasibility proposes a workable business structure and management team.

Types of Industrial Gas

Industrial gases are gaseous at room temperature. However, they may be compressed and sold as liquids. We can group industrial gases into three types. The three types are oxidizers, inert gases, and flammable gases.

1. Oxidizers

The common oxidizers include oxygen, chlorine gas, and nitrous oxide. Oxidizers are non-flammable gases that accelerate combustion in the presence of an ignition source and fuel.

2. Flammable Gases

Flammable gases include a group of industrial gases that, at ambient temperature and pressure, form a Flammable gas mixture with air. Common Flammable industrial gases include ammonia, acetylene, hydrogen, propane, propylene, and methane. All flammable gases are hazardous and should handle them with care. They should be stored under low temperatures and away from potential sources of fires or electric sparks.

3. Inert Gases

Industrial gases that fall under the category of inert include argon, neon, and helium. These gases do not undergo any chemical reactions under normal conditions of temperature and pressure. Because of its low solubility in liquids, oxygen plant manufacturers mix helium with oxygen to make breathing gas.

Both helium and argon create a gas shield in welding arcs. On the other hand, neon is a component of neon light with which we are all familiar.

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Our research reports broadly cover Indian markets, present analysis, outlook and forecast for a period of five years.

The market forecasts are developed on the basis of secondary research and are cross-validated through interactions with the industry players

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