The market for LNG bunkering is set to grow solidly over the coming decade reaching record levels by 2025, according to the latest figures from consultancy Transparency Market Research.
The outlook from TMR point to a compound annual growth rate (CAGR) of 63.6% and forecasts a rise to 22,540 kilo tons handled annually by 2025. the forecast describes the increase as a “staggering” growth from just 70 kilo tons of capacity in 2013, and suggests gas may rapidly rise to dominate transport fuelling this century.
“Natural gas is one of the most commonly used fossil fuels for power generation across the globe and is touted to be the fuel of the 21st century owing to its cleaner nature as compared to other popular fossil fuels such as coal and oil,” a spokesperson for TMR said.
Marine transport is identified as one key area of growth with the report noting that future sulphur oxide emission limits are expected to drive increased uptake. The widening of existing emission control zones (ECA) is also predicted to drive many shipping companies to switch to LNG.
“This factor is expected to have a significant impact on the global bunkering fuel market, which is exploring new and better bunkering fuel options to comply with the increasingly strict regulations being imposed to cut down sulphur emissions in marine environments,” the report’s authors note.
Container traffic to drive LNG growth
The findings are published in TMR’s LNG Bunkering Market – Global Industry Analysis, Size, Share, Growth, Trends, and Forecast, 2014 – 2025 report which is segmented on the basis of end-user and geography. It considers key end users of LNG bunkering market to be container vessels, bulk and general cargo vessels, tanker vessels, and ferries and offshore support vessels (OSVs).
“Of these, the segment of ferries and offshore support vessels accounts for a dominant share in the global LNG bunkering market. Over the report’s forecast period, the segment of containers is projected to significantly aid the expansion of the global LNG bunkering market, primarily owing to the rising container traffic in Asia Pacific and Europe,” the report notes.
In terms of geography, Europe emerges as the leading regional market for LNG bunkering due to the presence of a majority of LNG bunkering stations in the region, while North America is projected to benefit from the continuously declining prices of natural gas in the region.