the global LNG bunkering market was rated at 3.77 billion USD in 2020 for $5.14 billion by 2027, at a CAGR of 45.2% from 2021 to 2027. LNG is an attractive alternative fuel for seagoing and inland vessels, as liquefied natural gas emits fewer polluting substances. According to the IMO emission requirements, LNG is a potential substitute due to its negligible sulfur content and low NOx production, unlike fuel oil and marine diesel. LNG is a clean-burning fuel associated with financial points of interest based on calorific value among other fuels.
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The regulation of the International Maritime Organization of the sulfur limit of 0.50% m/m (mass/mass) in 2020 for marine fuels, increase in maritime trade, in particular in ton-km travelled. The lower cost of LNG bunker fuel compared to other ECA compliant fuel variants are the factors driving the growth of the global LNG bunker market. However, the gap between demand and supply for LNG bunkering is expected to increase with the implementation of IMO regulations; therefore, supply must increase rapidly to meet global demand and high-end demand from Asia-Pacific in particular. On the contrary, an increase in investments and financing for LNG bunkering is expected to create opportunities for the major players in the LNG bunkering market over the forecast period.
The global LNG bunker market is segmented on the basis of product type, application and region. By product type, the market is categorized into tank trucks, port-to-ship, ship-to-ship, and portable tanks. The applications covered in the study include container fleet, tanker fleet, freight fleet, ferries, inland waterway vessels and others. Regionally, it is analyzed in North America, Europe, Asia-Pacific, Middle East and Africa.
Dynamics of the global LNG bunkering market
Pilots: IMO regulations on the sulfur content of marine fuel
HFO and MDO are used as fuels in most generators and engines used in the marine fleet. These fuels are made from crude oil, which is a non-renewable fossil fuel. The IMO has allowed an overall cap of 0.5% sulfur on marine fuels from 1 January 2020, down from the current cap of 3.5%. The lower sulfur cap is expected to have a huge impact on the global refining and shipping industries due to stringent environmental policies aimed at reducing marine pollution.
Regulations on the lower sulfur cap in bunker fuels are expected to reduce marine pollution, which has led to an increase in demand for cleaner bunker fuels among shipping lines. The 2020 date is subject to review of the required availability of marine bunker fuel. Therefore, LNG bunkering is considered as a feasible alternative to diversify and secure fuel consumption in various end-use industries. Thus, there will be an increase in demand for LNG bunkering from the shipping industry, as this ensures increased environmental performance of maritime trade, including decreased greenhouse gas emissions.
Constraints: gap between supply and demand for LNG bunkering
LNG marine bunkering customers need security of supply and resilient supply chains. Conversely, suppliers should verify their investment plans and the capital required to supply LNG bunkers to the market. This stalemate has led to a lack of action, with shipping majors and LNG suppliers reluctant to make major investments until the other side shows its commitment. Pricing remains an unknown variable at this stage, and the market is rather opaque for LNG trading, with buyers and sellers dealing directly with each other to trade freight. Current LNG bunkering operations are limited to short sea shipping vessels. As the demand for LNG as a bunker fuel evolves, port authorities need to pay more attention to the economics and availability of LNG supply, two of the biggest challenges for the LNG market. LNG refueling.
Opportunities: LNG Transportation Services Opportunities
Bulk shipping is used to transport commodities or goods that cannot be placed in standard shipping containers. General cargo includes coils and rolls, structural steel, heavy or oversized cargo, construction equipment, wind turbine structures and vehicles. The breakbulk LNG service is part of the growth of the small-scale LNG sector by offering storage, breakbulk and reloading services.
Breakbulk shipping offers advantages such as transportability of non-containerized cargo, reduced deconstruction time, smaller port accessibility, etc. General cargo services divide large-scale LNG shipments into smaller ones. The use of LNG as a bunker fuel in this general cargo transport is expected to increase significantly, followed by the introduction of strict government regulations on marine pollution. Additionally, increasing investment in port infrastructure development to provide bulk LNG shipping services is expected to create opportunities for key players in this market.
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The study categorizes the LNG bunkering market based on product type, application, and regions.
Outlook by Product Type (Revenue, USD Million, 2017-2027)
- ship to ship
- Portable tanks
By Outlook Application (Revenue, USD Million, 2017-2027)
- Container fleet
- Tanker fleet
- Freight fleet
- Inland vessels
Outlook by Region (Revenue, USD Million, 2017-2027)
- North America (United States, Canada, Mexico)
- South America (Brazil, Argentina, Colombia, Peru, Rest of Latin America)
- Europe (Germany, Italy, France, United Kingdom, Spain, Poland, Russia, Slovenia, Slovakia, Hungary, Czech Republic, Belgium, Netherlands, Norway, Sweden, Denmark, Rest of Europe)
- Asia-Pacific (China, Japan, India, South Korea, Indonesia, Malaysia, Thailand, Vietnam, Myanmar, Cambodia, Philippines, Singapore, Australia and New Zealand, Rest of Asia-Pacific)
- The Middle East and Africa (Saudi Arabia, United Arab Emirates, South Africa, North Africa, Rest of MEA)
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Ship-to-ship, by product type, accounts for the largest market share in 2020
On the basis of product type, the global LNG bunker market is categorized into truck-to-ship, port-to-ship, ship-to-ship, and portable tanks. In 2020, the Ship-to-ship segment held the largest market revenue share of 60.52% and had a CAGR of 45.4% during the forecast period, 2021-2027. It is a type of bunkering in which an LNG bunker vessel delivers LNG to an LNG fueled vessel. This can be done in a variety of places, such as at anchor or along the quay or pier. Bunkering can also be done efficiently simultaneously as the vessel receiving LNG performs simultaneous cargo operations, depending on port restrictions. Ship-to-ship operations are feasible for any ship. The first ship bunkering using liquefied natural gas took place in the European port of Gothenburg in 2017.
The key driver for market growth includes increasing number of vessels using LNG due to the need for cleaner fuel that complies with stringent government regulations to minimize air pollution and maintain sustainability. In addition, owing to advantages such as fast transfer operations and high capacity of 700 to 7,500 tons, the LNG ship-to-ship bunkering segment is expected to experience substantial revenue growth during the period. forecast. Additionally, LNG-powered vessels can save approximately 25.0% of their overall fuel costs.
Asia-Pacific accounts for the highest CAGR over the forecast period in the LNG bunkering market
Based on region, the global LNG bunkering market has been segmented into North America, Europe, Asia-Pacific, South America, and Middle East & Africa. Asia-Pacific has a growth rate of 44.1% during the forecast period. 2021-2027. The Asia-Pacific LNG bunkering market is analyzed in Japan, China, India, Australia and the rest of Asia-Pacific. Additionally, the rapid rise in maritime trading activities across Asia-Pacific is propelling the growth of the LNG bunker market. Asia-Pacific is one of the most important markets for LNG bunker fuel. The main centers of consumption of raw materials in the world are currently located in this region. The port of Singapore in Asia-Pacific is now one of the largest ports in the world in terms of bunker fuel volumes traded.
Rising shipbuilding and infrastructure activities and rapidly growing trade in essential goods, raw materials and others are expected to boost the development of the LNG bunker market in the region. Additionally, restrictions on high sulfur content of marine bunker fuel imposed by the International Maritime Organization (IMO2020) are expected to drive the demand for ultra low sulfur fuel oils during the forecast period. It is expected that ultra low sulfur fuel oil or low sulfur alternatives such as LNG will replace high sulfur fuel oil during the period under analysis. Additionally, increased awareness and stringent government regulations regarding environmental pollution are expected to increase the demand for LNG (as a bunker fuel), which will create opportunities for major players in this market in the coming years. to come.
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Main market players
Global LNG Bunkering Market analysis covers in-depth information about major industry players. Major players operating and profiled in the report are Broadview Energy Total SE, Solutions BV, Harvey Gulf International Marine, Crowley Maritime Corporation, Gasum Oy, Klaw LNG, Korea Gas Corporation, Polskie LNG SA, Royal Dutch Shell Plc, SHV Energy, PETRONAS . , and Exxon Mobil Corporation. Other players operating in the value chain of the global LNG bunker market include ENN Energy Holdings, Ltd., Fjord Line, Gas Natural Fenosa, Eagle LNG, EVOL LNG, Statoil ASA, and others.