LNG Infrastructure Sector: Growth Drivers and Challenges
Growth Drivers
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Growing Trade of LNG As An Energy Source
According to the International Energy Agency (IEA) imports of natural gas around the world increased from 38382048 TJ in the year 2010 to 45875233 TJ in the year 2017.
The trade for natural gas around the world has expanded rapidly over the years owing to the demand for natural gas from several nations around the globe along with the presence of several natural gas resources in countries globally. Demand for natural gas in several nations has raised the need for investments from LNG infrastructure companies to provide rapid and flexible import solutions, for instance floating storage and regasification units. Transformation in the demand for natural gas from local to regional and global markets, coupled with increasing competition and diversity among the suppliers and customers, and the investment decisions taken by companies during the previous decade is contributing towards the increasing trade for LNG around the globe, which is anticipated to drive the growth of the global market in the upcoming years. - Growing Number of LNG Projects Under Construction and Planned Start Up
According to other statistics by the IEA, as of Q3 2018, more than seventeen new LNG projects are planned and are under construction around the world.
Several LNG producing companies around the world are increasingly investing on numerous new LNG projects which are under construction and are planned to come up in the near future. The increasing investments can be attributed to the lower initial investment costs and shorter installation periods required for the setting up floating storage and regasification units (FSRUs). As such, to meet the rising demand for LNG as an energy source, companies are increasingly investing to develop new plants for the production of LNG. Such a factor is anticipated to drive the growth of the global LNG infrastructure market.
Challenges
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Rising Demand for Alternative Source of Energy
Several nations around the globe are opting for alternative energy sources, such as nuclear energy as well as renewable energy sources, such as solar, wind and others. Additionally, high cost of equipment is also anticipated to hamper the growth of the global market throughout the forecast period.
