NEW YORK, Nov. 16, 2017 (GLOBE NEWSWIRE) -- The small scale LNG market is expected to witness a CAGR of 2.81%, and is projected to reach USD 43.5 billion by 2023. Factors propelling the growth of small scale LNG market are growing global natural gas reserves, favorable gas prices and stricter emission regulations. Further, flexible supply volume; growing demand from marine, heavy-duty trucking, rail and high-horsepower industrial equipment tends to support the growth of the small scale LNG market.
The report segments Small Scale LNG market by Type (Liquefaction Terminal (Onshore, Offshore), Regasification Terminal (Onshore, Offshore)), by Storage Tank (Pressurized (Spherical, Bullet), Atmospheric (Flat, Bullet), Floating Storage), by Supply Mode (Shipment & Bunkering, Trucks, Rail Tanks, Pipeline, Others), by Application (Transportation (Marine, Road, Mining), Off-grid power generation, others), by Region (North America, Europe, Asia-Pacific, Rest of the World (RoW). The report studies the global Small scale LNG market over the forecast period (2017-2023).
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Small Scale Liquefied Natural Gas (ssLNG) infrastructure include plants having a capacity less than 1 MTPA and carriers or vessels with a LNG storage capacity less than 30,000 cubic meters. LNG supply chain includes consolidated infrastructure from terminal and bunker vessels to the end users such as power and transportation industry. The LNG from the source is shipped to regional hub terminals. These import terminals facilitates the use of LNG in domestic market as well as the re-export of LNG to nearby markets. Further, the LNG in the domestic market is re-gassed and piped to the customers or distributed through trucks and container vehicles in the remote areas.
Key Findings of the Global Small Scale LNG Market Report
- The small scale LNG market is expected to reach at a capacity of 324 MTPA by 2023
- Onshore re-gasification terminals occupy the largest market share in terms of volume. The construction of number of onshore re-gasification terminals would drive the growth of onshore re-gasification small scale LNG market
- Offshore re-gasification terminal has the highest growth rate during the forecast period. The growth is supplemented by the increasing number of FSRU
- By supply mode, shipment and bunkering segment is expected to grow at a significant rate. The changing regulatory affairs pertaining to the emission in the marine transportation drives the growth of this segment
- The transportation segment is expected to garner the majority share of the small scale LNG market. Factors such as clean fuel, environment regulations, low cost of LNG fuel and government incentives propel the growth of transportation segment
- The off grid power generation segment of small scale LNG market is expected to grow at the highest CAGR in the years to come. The existence proper LNG infrastructure in place, need to maintain low air quality, higher fuel efficiency and low capital cost will pent up the demand of small scale LNG in off grid power segment
- Geographically, Asia-Pacific dominates the small scale LNG market. The underdeveloped large scale gas infrastructure and increasing demand of LNG in LNG-to-power projects is driving the growth of small scale LNG in the region
- Europe is the second largest small scale LNG market. Europe is capitalizing on developing LNG fuelling infrastructure inland as well as across the shore to make LNG economically viable
- Companies are forming associations to develop solutions related to small scale LNG business and working towards promoting low carbon economy, for instance Wartsila has come in agreement with French company Engie to develop services and solutions related to small scale LNG businesses
- Engie will invest around 112 million USD to develop small scale LNG and CNG trucking infrastructure across Europe by 2020
- In February 2017, Gazprom signed an agreement with Avtodor to develop a network of LNG and CNG filling stations in Russia. Gazprom is developing small scale LNG infrastructure in Vietnam, China, Belarus and Bolivia
- In April 2017, approximately 61 small scale LNG ship carriers are operating globally
- The key players dealing in small scale LNG market are Wartsila Corporation, The Linde Group, General Electric, FLUXYS, Golng Indonesia, Energy Holdings Limited, Kunlun Energy, Plum Energy, Engie, Gazprom, Skangass AS, Gasnor
Investor Corner
Small scale LNG offers abundant opportunity in the market which are not connected to pipeline network as well as the markets where the infrastructure is less developed. Small scale LNG market is an attractive investment for the investors particularly for those who are willing to enter the oil and gas industry. The small scale LNG is tapping point for those investors with less capital investments and has long term plans to expand in LNG market. With minimum risk and good return on investments the small scale LNG market has lot to offer. The added advantage that Small scale LNG provides is modularization of LNG market in term of supply and infrastructure. These small scale infrastructures supplements the current LNG market demand. Over the long term small scale LNG can be integrated with large scale projects or can be developed into large scale projects over a course of time. The small scale LNG offers a promising growth as new markets are opening up for LNG projects. Further, the revamping marine and heavy vehicle industry requires small scale infrastructure for seamless supply of fuel. Moreover, changes in the regulatory policies pertaining to the use of fuel are driving a number of industries to switch to LNG. The bunkering ship, import terminals and trucked cargoes servers as the building block for the growth of small scale LNG. However, the sustainability of small scale LNG market depends on well connected supply chain to the end users.
Regional Insight
Asia-Pacific is a hub of small scale LNG activity mostly driven by the capital investment by countries such as India and China. Major LNG demand is simulated by the LNG-to-power demand and transportation in the region. LNG being a clean and low emission fuel is promoted by government commitments to turn to LNG based economy.
The policy in North America pertaining to LNG trade is changing for better. The Trump administration has proposed a rule that will provide for faster approval of small scale export of natural gas from export facility. Central America, Caribbean and South America are the target market of U.S. small scale industry. Most of the countries in these regions are LNG deficient; they import large volume of LNG through conventional tankers and large scale terminals. The small scale LNG export market has provided a solution eliminating economic and practical caveats pertaining to natural gas exports to these countries.
Europe is spending heavily to develop LNG infrastructure. The changing fuel scenario especially in countries such a France, Belgium and UK is driving the growth of small scale LNG in the region. The emission control policy especially in marine transport and heavy vehicle sector is increasing the consumption of LNG in Europe. Further, the blue corridor projects that aim to build LNG fuelling infrastructure across Europe in order to make LNG economically viable fuel will attract investments from major companies operating in Europe.
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