Cost & Price Analysis
PCP pumps represent a fairly low market share globally. Coupled with small R&D costs, simple design and small market, the pricing of PCP pumps has always been driven by supply and demand factors, with occasional opportunistic approaches. In the medium term, the prices for PCP pumps will not exhibit any volatility and will be driven by commodity prices and demand for pumps in non Oil & Gas sectors
There are two major cost drivers for PCP pumps:
- Non-Oil & Gas industries, such as Mining, Construction, Fish, Food, Paper, Marine, Sewage and many more
- Pump components- such as steel and motor ( electrical)
As with any other down-hole steel products, depending on the design and application, the costs of PCP pumps may vary by 3 times due to the selection of materials and processes, as well as the selection of elastomers/fluoroelastomers (high-quality synthetic rubber for sealing). High temperature and high H2S wells affect the material selection, this cost.
The acquisition of PCP pumps is primarily influenced by two factors - Assembly / Manufacturing costs and R&D costs.
Manufacturing & assembly costs- the majority of the components and parts used in assembling the PCP systems are electrical and steel. Most of the items are heavily used by other industries; hence PCP manufacturers may have limited control of costs.
Research & development costs - for most PCP pumps that are designed for standard applications, R&D costs spread over a longer period and larger markets. For any “tailor-made” systems, R&D costs are expected to go up significantly.