Small-scale LNG Market An insight on the important factors and trends influencing the Global Industry Scenario by 2025


Liquefied natural gas (LNG) is a type of natural gas that is converted into liquid form. The process of conversion is called liquefaction. LNG is extensively used, which is a factor likely to drive the demand for small-scale LNG during the forecast period.

Rising demand for electricity in recent days has augmented the demand for LNG, which has led to higher production of LNG. Several remote areas are devoid of electricity supply and increasing government initiatives about rural electrification have raised the demand for LNG in recent years. The trend is likely to continue in the next few years. Increasing industrialization and risen household requirement have increased the demand for electricity production. This, in turn, boosts the global market for small-scale LNG. LNG is also used for cooking and heating purposes and with the rising population, growth potential for the small-scale LNG market is expected to increase during the forecast period. Reduction in the prices of natural gas and fluctuation in the prices of crude oil caused by excessive production of crude oil are major drivers for the small-scale LNG market.

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One of the major disadvantages of LNG projects is that the LNG production is not cost-effective. As the production process involves substantial amount of technology, prices of LNG are higher in the overall energy sector. Moreover, use of high-end technologies in the production process makes the process challenging, which restraints the growth of the small-scale LNG market. However, with the rapid advancement of technology, a cost-efficient method for the production of LNG can be achieved in the next few years.

Increasing concerns about the environment lead the worldwide energy producers to switch their production to LNG from other forms of fuel such as diesel. Stricter emission control norms by governments and international agencies have increased the production of LNG in developed as well as emerging economies. This has increased the use of LNG in commercial and industrial sectors. This is likely to offer growth opportunities for the small-scale LNG market during the forecast period. Hence, inclination toward greener and cleaner fuel creates growth opportunity for this market.

Based on type, the small-scale LNG market has been segmented into liquefaction terminal and re-gasification terminal. The regasification terminal segment holds the maximum market share, as LNG is employed power generation plants in remote areas. Development of the downstream infrastructure and logistics, LNG bunkering, trucking stations, and remote regasification terminals is raising the demand for LNG. This, in turn, is anticipated to trigger the growth of the small-scale LNG market during the forecast period.

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Some of the key companies in the global small-scale LNG market are Honeywell International Inc., General Electric, The Linde Group, Dresser-Rand Group, Inc., and Gazprom.

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