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A clear distinction between LNG and LNG is a pre-requisite for understanding the basics of what is being discussed in this report. Understanding the definition terms, LPG – Liquified Petroleum Gas is a byproduct gas obtained in the process of extracting petroleum which has propane as the major constituent while, LNG – Liquified Natural Gas is the Natural Gas, only in a liquid form.
The liquid form reduces the volume of the gas drastically as it occupies around 1/600 the volume of natural gas in general. The major constituent of LNG Fuel Market is methane and with the property of non-corrosive material at its advantage.
LNG was invented in 1820 and the first commercial industry for the same was established in West Virginia which kicked off in the year 1917. The dramatic rise in trade of LNG is because of the increased demand in the fuel to fulfill the demands of increasing globalization every day has made LNG a go-factor for marketers to invest upon.
In this report, we will further understand the market dynamics of LNG.
By 2019 statistics, the World’s largest exporter of liquified natural gas in Qatar. It is a key player in this field as Qatar is home to the third-largest reserves for the same, thus making it highly resourceful. The interesting thing to consider is the high demand and relatively low prices of the LNG in the marketplace.
Market researches showing low demand in LNG Fuel Market has created an excess of uncontrollable supply in the present times making the market volatile.
To understand LNG’s importance, we must have a look as well at where it is in use. Because of LNG, 70% of energy requirements are met by commercial and residential sectors. Somewhere around 18% is accountable for electricity generation with 35% of its use involved for industries.
The record of 2019 indicates a 12% increase in demand for LNG Fuel Market globally where China itself holds a record of 12% growth of LNG demand. Robust economic growth patterns in various countries make LPG one of the primary places of import/export for their use.
Power generation has been one of the major uses of LNG and because of the world’s growing hunger for energy, it’s unlikely that this market will diminish in the upcoming times. Augmentation in LNG’s demand in the transportation and industrial sectors is a pivotal factor that drives this market forward.
Covid-19 has created widespread insecurities in various fuel markets all over the world. In the meantime, as expected, there has been a decline in demand in the market. However, with lockdowns lifting nowadays, a positive outlook is expected in the upcoming months ultimately stabilizing the market back to normal and progressive.
Liquified Natural Gas is subject to fluctuations and turbulences because of unstable oil prices and thus is indirectly vulnerable to changes in global oil prices.
On a regional basis, its market can be divided into North and Latin America, Asia Pacific, Middle East, and Africa. The region of Asia Pacific is observed to be the most opportunistic as well as blooming LNG Fuel Market because of the export record of recent times.
The proliferation of trading in Southeast Asian and Caribbean regions is allowing for small-scale expansions on supplier sides and is paving and pushing the way forward for the LNG market.
China and South Asia are one of the most promising markets with plenty of growth opportunities because of inexpensive products and favorable satisfaction that can be met with the increased electricity demand.
Companies collaborating to enhance the use of LNG provide a way for new scopes in the market. An example of a partnership between GE and Technip, looking for a digital and futuristic solution for technology, engineering and operational advancements for LNG are propelling factors for this industry to drive forward.
The most fascinating and irresistible characteristic of LNG – around 200 years of reserves available. The liquid form of LNG makes it fire resistible and thus making safety an essential and appealing feature. As stated earlier, its main constituent is Methane which makes it way more efficient than propane, in simple words – High calorific value.
Plans are to accelerate industrial demand through innovations in equipment. Since new equipment is necessary for achieving more productivity in less time, innovations are emerging in drilling, process-in-work, and the final production and storage facilities, which are making the whole Liquefaction and transporting processes less hazardous and more attractive options for chances of growth in present times.
In comparison with other fuel substituents in the market, LNG produces comparatively a smaller number of pollutants namely Sulphur dioxide, Nitrogen dioxide, and Carbon Dioxide. Thus, clean fuel is tagged with its name. Since LPG is easy to extract, it is economical and cheap, which is an advantageous feature over other fuels.
Focusing on the attributes of LNG, countries are focusing more upon researches and extracting of the same. The welcoming policies of countries over this issue, allure global Multi-National firms to collaborate with governments in finding and exploitation of such reserves. This creates business and more opportunities for people as well for employment thus pushing the growth of the Liquified Natural Gas market simultaneously.
Some of the prominent companies to know about in this field are:
And the list continues which indicates the severity of the competition in this area. One of the major areas of companies’ interest lies in the development of large-scale pieces of machinery and terminals as well as for liquefaction of gas extracted. That is, there is an automatic need for major infrastructure facilities for this gas to be extracted, refined, and transported to stations that finally convert this gas to be utilized by various spheres over the globe.
With the encouraging traits of LNG, the market ahead seems optimistic on the grounds of clean fuel which is lauded as the awareness among people globally is increasing on deteriorating consequences of usage of conventional fuels.
This also gives a boost to the Research and Development of the fuel industry to discover and innovate more promising solutions overtime for the world’s benefit.
