Water Market Insights No

· “Shale Markets and Instrumentation” will be “Hot Topic” Next Friday,

· Power Companies will be the Largest Purchasers in the $7 Billion Sedimentation and Centrifugation Market

“Shale Markets and Instrumentation” will be “Hot Topic” Next Friday, February 1, 2013

At 10 a.m. (CST) on Friday, February 1, McIlvaine will be providing some general market forecasts for the oil and gas shale industry. This will be supplemented by some specific applications for instrumentation. Perkins & Elmer will be covering the important subject of measuring methane in water. Lee Marotta, Senior Field Application Scientist at PerkinElmer, Inc., and Dennis Yates, Senior Spectroscopy Technology Specialist will be speakers. Tom Tschanz and Bob McIlvaine of McIlvaine will be discussion leaders.

There is a big controversy as to whether methane found in drinking water has always been there or is the result of some new fracking activity. It is, therefore, important to quantify the methane levels before and after gas and oil extraction.

McIlvaine will be initiating discussions on the future of both gas and oil shale. The U.S. market has recently shifted from the dry shale in the East to the wet shale in the West. But plans for gas to liquids, gas turbine combined cycle and LNG plants all promise to drive up the price of shale gas and increase the number of drilling rigs. The amount of shale gas and oil potentially recoverable in other countries far exceeds that in the U.S. The question is when, if ever, will this international potential be exploited?

The impact of regulatory activity has a somewhat negative impact on total production, but not on the instrumentation markets. The new requirements for emission reduction during well completion plus tighter limits on air and water emissions all will boost instrument sales. The complexity of fluids extracted from shale also requires more extensive instrumentation for both processing and custody transfer. Measurement of temperature throughout the extensive perforated horizontal casing two miles underground is just one other example of this complexity.

On Thursday at 10 a.m. Central time, McIlvaine hosts a 90 minute web meeting on important energy and pollution control subjects. Power webinars are free for subscribers to either Power Plant Air Quality Decisions or Utility Environmental Upgrade Tracking System. The cost is $125.00 for non-subscribers. Market Intelligence webinars are free to McIlvaine market report subscribers and are $400.00 for non-subscribers.

DATE	Non-Subscribers Cost	SUBJECT	Webinar Type
January 31, 2013	$400.00	Filter media (forecasts and market drivers for media used in air, gas, liquid, fluid applications, both mobile and stationary)	Market Intelligence
February 1, 2013	No charge	Shale Markets & Instrumentation	Free
February 7, 2013	$125.00	Valves for Power Plants, Boilers and Water Treatment Facilities	Power
February 14, 2013	$125.00	NO_x Control for Gas Turbines	Power
February 21, 2013	$125.00	Monitoring Boiler Steam Cycle Chemistry	Power
February 28, 2013	$125.00	Implementation of the MACT Rule	Power
March 7, 2013	$125.00	HRSG Design, Operation and Maintenance Considerations	Power
March 14, 2013	$125.00	Inlet Air Pretreatment for Gas Turbines	Power
March 21, 2013	$125.00	Industrial Boiler MACT Impact and Control Options	Power
March 28, 2013	$125.00	Mercury Measurement and Control	Power
April 4, 2013	$125.00	Fabric Selection for Particulate Control	Power
April 11, 2013	$125.00	Air Pollution Control for Gas Turbines	Power
April 18, 2013	$125.00	Multi-pollutant Control Technology	Power
April 25, 2013	$125.00	Control Technologies for Fine Particulate Matter	Power
May 2, 2013	$125.00	Flyash Pond and Wastewater Treatment Issues	Power
May 9, 2013	$125.00	Clean Coal Technologies	Power
May 16, 2013	$125.00	Power Plant Automation and Control	Power
May 23, 2013	$125.00	Cooling Towers	Power
May 30, 2013	$400.00	Air Pollution Control Markets (geographic trends, regulatory developments, competition, technology developments)	Market Intelligence
June 6, 2013	$125.00	Report from Power-Gen Europe (update on regulations, speaker and exhibitor highlights)	Power
June 13, 2013	$125.00	Monitoring and Optimizing Fuel Feed, Metering and Combustion in Boilers	Power
June 20, 2013	$125.00	Dry Sorbent Injection and Material Handling for APC	Power
June 27, 2013	$400.00	Power Generation Forecast for Nuclear, Fossil and Renewables	Market Intelligence
July 11, 2013	$125.00	New Developments in Power Plant Air Pollution Control	Power
July 18, 2013	$125.00	Measurement and Control of HCl	Power
July 25, 2013	$125.00	GHG Compliance Strategies, Reduction Technologies and Measurement	Power
August 1, 2013	$125.00	Update on Coal Ash and CCP Issues and Standards	Power
August 8, 2013	$125.00	Improving Power Plant Efficiency and Power Generation	Power
August 15, 2013	$125.00	Control and Treatment Technology for FGD Wastewater	Power
August 22, 2013	$125.00	Status of Carbon Capture and Storage Programs and Technology	Power
August 29, 2013	$125.00	Pumps for Power Plant Cooling Water and Water Treatment Applications	Power

McIlvaine will be at stand #123 next to Parker Hannifin and across from U.S. Lime. As usual, we will be facilitating discussions at EUEC next week in Phoenix. The following list shows those whose pictures were taken last year:

Some new faces on the scene will be Jacob Kershman and Rob Fredell. They will be manning the Neumann stand #338. Neumann will announce a new product line at EUEC which they say will dramatically reduce the operating cost of Dry Sorbent Injection (DSI) air pollution control systems. The NeuStream^®-DR process offers DSI operators a 90 percent recovery in the unreacted trona in their flyash when DSI is used for SO₂ pollution control.

NSG Chairman and President Dr. David Neumann said “NeuStream^®-DR enables up to 67 percent reduction in trona usage, cutting DSI operating expenses by more than half. NeuStream^®-DR captures and re-processes the large portion of unreacted trona from the flyash waste of DSI systems for re-use as sodium bicarbonate.”

Yokogawa has sold ammonia slip monitors for the Hitachi SNCR systems at AEP Clinch River. The TDLS instrument has application for many combustion processes. Ed Deck and Dale Cathey (Gas Products Marketing Manager) will be available to discuss instrumentation and automation. Dale is assuming marketing responsibilities for the TDLS.

Jon Lemkuhler, John Schettler and Janet Chetland of Chemtura will be available to discuss use of bromine compounds to capture mercury.

The market for monitoring and instrumentation systems to measure the properties of gases including air will exceed $4.5 billion in 2013. This is the latest forecast in Air & Water Pollution Monitoring World Markets published by the McIlvaine Company. www.mcilvainecopmpany.com

Revenues $ Millions
Industry	2013
Asphalt	7
Bioclean	8
Chemical	90
Commercial & Residential	528
Electronics	30
Food	20
Government & Academia	1,291
Incinerators	34
Metals	182
Mining	58
Other Industries	277
Pharmaceutical	40
Power	1357
Pulp & Paper	43
Refining, oil and gas	400
Steel	49
Stone	54
Surface Coating	12
Wastewater	32
Total	4,512

The market will achieve growth well above GDP because of four important factors:

Developed and developing countries are all increasing the stringency of their air pollution regulations. Accurate measurement of the pollutants is the key to enforcement. With the steady increase in the cost of fuel and the negative aspects of carbon dioxide emissions, energy efficiency is becoming increasingly important. Instant measurement of the products of combustion and of oxygen is critical.

Process automation is often dependent on continuous monitoring of physical and chemical composition of gases. Refining, oil and gas exploration and petrochemical production rely on these measurements.

Product quality control is also enhanced by air measurement. Semiconductor chips are subject to particulate damage. Facility monitoring systems continuously measure particulate at many points.

The safety and health of workers and residents is leading to accelerated monitoring of work and living space. Air borne contaminants include particulates, gases, mold, viruses, etc.

All gas phase measurement devices are included. Here are the gas phase categories:

· The measurements can be made continuously in processes, with periodic sampling and in the laboratory. Some of the laboratory sampling is of solids or liquids which have been used to trap the air contaminants.

Devices are needed to measure the physical properties of the gas. The measured properties are:

Measurement of chemical properties is a challenge. There are hundreds of gas phase compounds which need to be measured. Some contaminants e.g. dioxins, appear as a number of distinct compounds. It is, therefore, necessary to measure each and utilize an equivalency factor to measure the total for the contaminant group. The chemical groups can be divided into four categories:

o Compounds impacting combustion efficiency (oxygen, carbon monoxide, carbon dioxide)

The forecasts do not include devices measuring air and gas properties in vehicles. This is a large and separate market.

Power Companies will be the Largest Purchasers in the $7 Billion Sedimentation and Centrifugation Market

Purchases of clarifiers, centrifuges, cyclones, dissolved air flotation units and other sedimentation and centrifugation equipment will exceed $7.3 billion in 2013. This is the latest forecast in the McIlvaine Sedimentation/Centrifugation World Markets. www.mcilvainecompany.com

The power industry will be the largest purchaser. Power plants extract ten times more water than do municipalities. Before it can be used as boiler feedwater or even for cooling, the water must be purified. Clarifiers are used for primary particle removal. The flue gas desulfurization systems utilize hydrocyclones, centrifuges and clarifiers. Geothermal plants are also purchasers. Biomass energy plants require this equipment for the incoming water and for the scrubber wastewater clarification.

Municipal wastewater treatment plants will be the second largest group of purchasers. Decanter centrifuges are used to dewater the sludge. A series of clarifiers is needed in the physical and biological treatment of the sewage.

The mining industry will be the third largest purchasing group. The mining industry is expanding capacity at greater than average rates. It is also retiring and replacing capacity. Clarifiers, thickeners and hydrocyclones are used in the beneficiation processes as well as treatment of tailing.

The food industry will also be a major purchaser. Centrifuges are often used to make products. The disc centrifuges purify wine and juices. The dairy industry is heavily reliant on centrifuges.

The pharmaceutical and biotechnology industries utilize disc centrifuges to purify products. These devices are often the largest capital expense in the process.