Global LNG Storage Tank Market - 2023-2030

Global LNG Storage Tank Market - 2023-2030

The Global LNG Storage Tank Market reached US$ 4.5 billion in 2022 and is expected to reach US$ 6.7 billion by 2030, growing with a CAGR of 5.5% during the forecast period 2023-2030. The global LNG storage tank market has grown substantially in recent years, driven by the increasing demand for liquefied natural gas (LNG) as a clean and efficient energy source.

LNG storage tanks play a crucial role in the LNG supply chain, enabling safe and efficient storage and transportation of LNG from production facilities to consumption centers. Increasing environmental concerns and efforts to reduce carbon emissions have led to a shift in the global energy mix. Natural gas, including LNG, is considered a cleaner alternative to coal and oil, leading to a greater emphasis on natural gas infrastructure development.

North America stands out as a key player, accounting for over a quarter of the market share due to factors such as the region's high natural gas deposit and highly developed infrastructure to extract and utilize the available LNG reserve. The LNG storage tank market is witnessing technological advancements, enabling the construction of larger, more efficient, and safer storage tanks. Within the types of LNG storage tank, the steel LNG storage tank segment is witnessing the fastest growth and is projected to capture nearly half of the market share. The segment's rapid expansion can be attributed to its superior characteristics such as strength.

Market Dynamics

Shifting Energy Mix and Increasing Global Natural Gas Consumption

The global shift towards cleaner energy sources and environmental concerns are driving the demand for LNG storage tanks. Governments worldwide are adopting policies and regulations to reduce carbon emissions and mitigate climate change. LNG, with its lower carbon footprint compared to coal and oil, is playing a crucial role in the energy transition.

According to the International Gas Union (IGU), LNG emits around 50% less CO2 per unit of energy compared to coal. This transition to LNG as a cleaner fuel source necessitates the development of robust storage infrastructure, including LNG storage tanks. Another one of the primary drivers propelling the LNG storage tank market is the growing global natural gas consumption.

Natural gas has become a cleaner alternative to traditional fossil fuels, offering lower greenhouse gas emissions. According to the International Energy Agency (IEA), global natural gas consumption increased by 2.3% in 2020. Governments worldwide are implementing policies to promote the use of natural gas, driving the demand for LNG storage tanks to support the growing infrastructure for natural gas storage and transportation.

Expanding LNG Infrastructure

The expansion of LNG infrastructure is another major driver for the Global LNG Storage Tank Market. With the rising demand for natural gas, countries invest in developing LNG import and export terminals. According to the United Nations Conference on Trade and Development (UNCTAD), global LNG trade increased by 4.9% in 2020.

Governments are establishing new LNG terminals and expanding existing ones to meet the growing demand for LNG. The respective fact necessitates the construction of additional LNG storage tanks to ensure adequate storage capacity and enable uninterrupted supply chains. The development of LNG infrastructure in emerging economies is a significant driver for the global LNG storage tank market.

Countries in Asia-Pacific, such as China and India, are witnessing rapid economic growth and urbanization, resulting in increased energy demand. These countries are investing heavily in LNG import terminals and expanding their storage capacities. For instance, China's LNG imports reached a record high of 65 million tons in 2020, according to the General Administration of Customs of China. This infrastructure development in emerging economies fuels the demand for LNG storage tanks to support the growing LNG trade and consumption.

High Initial Investment and Infrastructure Requirements

The global liquefied natural gas (LNG) storage tank market has witnessed substantial growth in recent years, driven by the increasing demand for LNG as a cleaner alternative to traditional fuels. LNG storage tanks play a crucial role in the transportation, storage, and distribution of LNG. However, despite the positive market outlook, several significant restraints hinder the growth of the global LNG storage tank market. One such major restraint that hampers the respective market is the high initial investment and infrastructure requirements.

The construction of LNG storage tanks involves substantial capital expenditure, including site preparation, engineering, and safety measures. Additionally, the need for specialized equipment and materials adds to the cost. According to data from the U.S. Department of Energy, the average cost of an LNG storage tank is around US$ 200 to US$ 300 per cubic meter. The high capital requirement acts as a deterrent to market entry and limits the expansion of LNG storage facilities, especially in developing regions.

COVID-19 Impact Analysis

The COVID-19 pandemic resulted in disruptions across global supply chains, impacting the construction and delivery of LNG storage tanks. Restrictions on movement, lockdown measures, and workforce shortages led to delays in the delivery and installation of LNG storage tanks. Government-imposed restrictions on international trade and travel further hindered the procurement of essential components and equipment required for the construction of LNG storage facilities. According to the World Trade Organization (WTO), the volume of world merchandise trade fell by 5.3% in 2020.

The pandemic caused a significant decline in energy demand worldwide, affecting the LNG storage tank market. Industrial shutdowns, travel restrictions, and reduced economic activities resulted in a decline in natural gas consumption. According to the International Energy Agency (IEA), global natural gas demand decreased by 2.5% in 2020 compared to the previous year. The decline in energy demand led to lower LNG production and reduced the need for additional LNG storage tank capacity.

Segment Analysis

The global LNG storage tank market is segmented based on type, material and region.

Strength, Durability and Cost-Effectiveness

LNG storage tanks are crucial infrastructure components that enable the safe and efficient storage of liquefied natural gas. Among the various materials used in the construction of LNG storage tanks, steel has emerged as a prominent choice due to its strength, durability, and cost-effectiveness.

The increasing global demand for LNG is a major driver for the growth of the steel segment in the LNG storage tank market. As countries transition towards cleaner and more sustainable energy sources, LNG plays a significant role in meeting the growing energy needs.

According to the International Energy Agency (IEA), global LNG trade reached 356 million tonnes in 2020, representing a 4% increase compared to the previous year. The IEA further predicts that LNG demand will continue to rise in the coming years, driven by factors such as environmental regulations, coal-to-gas switching, and the expansion of LNG infrastructure. The growing demand for LNG necessitates the construction of additional storage tank capacity, leading to opportunities for the steel segment in the market. As the world continues its transition towards cleaner energy sources, the steel segment in the LNG storage tank market is well-positioned to capitalize on the expanding opportunities.

Geographical Analysis

Rising LNG Consumption and Government Initiatives Supporting the Growth

The International Gas Union predicts that after rising to 356.1 MTPA in 2020, global LNG consumption will reach 375 million tonnes per annum (MTPA) in 2022. North America is expected to dominate the LNG storage tank market, with the majority of consumption originating from U.S. and Canada. Additionally, LNG is a superior alternative fuel and governments have been taking steps to adapt to LNG. The Canadian government has pledged to cut greenhouse gas emissions substantially and there is a plentiful supply of natural gas in Canada.

Natural gas is a superior alternative marine fuel for the Canadian shipping industry because it emits fewer greenhouse gases when burned. Further, Venture Global LNG's Plaquemines in Louisiana and Pacific Energy Corp Ltd's Woodfibre in British Columbia are two new significant LNG projects in North America. The U.S. government authorized Venture Global to begin early site preparation in Plaquemines and subsidiaries of Sinopec signed long-term LNG purchase agreements with the business. As a result, it is predicted that North America will dominate the global LNG storage tank market throughout the forecast period.

Competitive Landscape

The major global players include Corban Energy Group, Linde plc, McDermott International Inc., Wartsila, IHI Corporation, CIMC ENRIC, Chart Industries, ISISAN ISI SAN. VE TİC.A. Ş, Cryolor SA and Trans Tech Energy LLC.

Why Purchase the Report?
• To visualize the Global LNG Storage Tank Market segmentation based on type, material and region and understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous LNG storage tank market-level data points with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.

The Global LNG Storage Tank Market Report Would Provide Approximately 53 Tables, 47 Figures And 187 Pages.

Target Audience 2023
• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies