Liquefied Natural Gas Market Witness Significant Growth Of $20.6 Billion By 2025: Grand View Research, Inc.

September 10 07:34 2019
Liquefied Natural Gas Market Witness Significant Growth Of $20.6 Billion By 2025: Grand View Research, Inc.

Grand View Research, Inc. – Market Research And Consulting.
According to report published by Grand View Research,Rising focus on development and expanding gas pipeline infrastructure and growing demand for natural gas from downstream sectors is a crucial driving factor for the liquefied natural gas industry.

According to a report,“Liquefied Natural Gas (LNG) Market Analysis By Application (Transportation Fuel, Power Generation, Mining & Industrial), By Region, And Segment Forecasts, 2018 – 2025”, published by Grand View Research, Inc., The global Liquefied Natural Gas (LNG) Market is expected to reach USD 20.6 billion by 2025, growing at a CAGR of 12.7%, Rising focus on development and expanding gas pipeline infrastructure and growing demand for natural gas from downstream sectors is a crucial driving factor for the industry.

Decreasing LNG prices along with execution of favorable government rules and regulations, which are attracting FDIs & tax schemes are also conducive to industry growth. Cumulative emphasis of adequate support infrastructure in numerous economies is anticipated to enhance product demand in the construction sector, since the product is used in building equipment.

On the contrary, insufficient channel infrastructure is supplementing demand for small scale projects to source natural gas for key consumers in remote areas, specifically in the power generation and industrial manufacturing verticals. Rapid urbanization, industrialization and increasing projects supporting power, gas & petrochemical distribution are projected to positively provide stimulus to the industry.

Power generation accounted for 46% of the volume share in 2016, and is anticipated to grow at over 6.9% CAGR from 2017 to 2025. Power generation plants are gradually shifting from naphtha-based feedstock towards LNG in order to provide cost-competitiveness and enhanced delivery times while also receiving support in the form of favorable regulations encouraging these trends.

Key Takeaways from the report:

  • The global LNG market demand exceeded 265 million tons in 2016 and is expected to grow at a CAGR of 6.5% from 2017 to 2025

  • Transportation is emerged as the largest application in 2016 and is estimated to generate revenue over USD 3.6m billion by 2025 owing to widespread adoption of sustainable resources in place of conventional fuels

  • Prices in North America are expected to be dependent upon the Henry Hub model, while demand in South Africa is likely to continue being unpredictable on account of civil unrest and fluctuating supply dynamics

  • Europe is likely to witness moderate progress with rising competition from Russia and Norwegian piped natural gas (PNG). Africa is expected to remain a rapidly developed market with new production strategies in the Cameroon and development anticipated in Mozambique.

  • Asia Pacific consumption patterns are projected to remain exponentially high over the next decade owing to various developments across emerging economies, especially in the power generation and transportation market. The region is expected to grow at a CAGR of 6.5% from 2016 to 2025

  • Key players including Chevron, Exxon Mobil, PetroChina, Total SA, Stat oil, Eni S.p.A., BP plc, Royal Dutch Shell, Conoco Philips and CPCC dominated the sector accounting for over 60% of the total volume in 2016

U.S. LNG market revenue, by application, 2014 – 2025 (USD Million)

U.S. LNG market revenue, by application, 2014 - 2025 (USD Million)

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Global LNG market volume, by application, 2016 (%)

Global LNG market volume, by application, 2016 (%)


Regional Insights

Rapidly rising Liquefied Natural Gas production in Australia is expected to positively influence the power sector dynamics over the forecast period. However, rising demand from the east Asia with the nuclear plants is likely to negatively impact the energy mix of Japan and south Korea. India is likely to remain an attractive destination for the manufacturers and exporters owing to the surge in the infrastructure development.

In the Atlantic region, the Henry Hub Linked LNG price is projected to provide stimulus to the global pricing. Furthermore, Africa is also expected to remain a stimulating region with new production strategies and development from Cameroon in Mozambique.

Middle East is ready to engross spot and short-term volumes in terms of demand. Various countries are restructuring their gas markets to attract new investments. Several other economies including China, Mexico, and Egypt, are moving ahead with significant reforms, inviting more private participation in the supply, transport, and marketing, and familiarizing third-party access to gas infrastructure.

Incentives on various fuels are being reduced considerably in various parts of the Middle East, North Africa, Latin America, and Asia. This exercise is likely to expose power generation to more competitive pressures in comparison to other fuels and technologies. Prices that replicate the industry essentials are also likely to result into high consumption and increased investments.

India is expected to witness highest growth rate in Asia Pacific in upcoming years. Energy mix gas accounts for only 5% of primary energy consumption in India, providing plenty of space for expansion. Strong economic growth across the region is also leading towards higher utilization of gas based power facilities and improved application scope in the industry. These factor are expected to propel the demand for LNG in the Indian market

Gas consumption is anticipated to decrease in Japan in upcoming years. However, new policies in Korea are likely to generate ample growth opportunities. Japan and Korea consumed around 45% of the total traded volumes in 2016, with substantial volume shares as well.

These economies witnessed reduced production in recent years owing to several factors such as safety issues with nuclear power plants in Korea and an upsurge in gas use as a result of the East Japan Earthquake. This trend is anticipated to continue over the forecast period as well, resulting in reduced demand across the regions.

However, there are substantial uncertainties over the trajectory in both the economies. In Japan, twelve nuclear reactors have been permitted the green light from safety authorities and five more have restarted. Besides this, the new government in Korea has also formulated several favorable rules and regulations, targeting at a reduced usage of nuclear and coal-fired power. This factor is further projected to fuel the demand for LNG in near future.

Competitive Insights

The global industry is highly competitive and fairly concentrated, with top four companies accounting for maximum share of the global production. Key participants include BP plc, Royal Dutch Shell, Chevron and Exxon Mobil.

Application developments are expected to be the key parameter for being competitive in this market. The industry is also anticipated to witness frequent mergers and acquisitions as an attempt to diversify product portfolio and gain market share.

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About Grand View Research, Inc.

Grand View Research provides syndicated as well as customized research reports and consulting services on 46 industries across 25 major countries worldwide. This U.S.-based market research and consulting company is registered in California and headquartered in San Francisco. Comprising over 425 analysts and consultants, the company adds 1200+ market research reports to its extensive database each year. Supported by an interactive market intelligence platform, the team at Grand View Research guides Fortune 500 companies and prominent academic institutes in comprehending the global and regional business environment and carefully identifying future opportunities.

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