Impact of Outbreak of COVID-19 on LNG Liquefaction Equipment Market

February 10, 2021

Liquefied natural gas (LNG) is the liquid form of natural gas at temperature of −161°C. The liquefaction process of natural gas shrinks its volume by 1/600 of the volume of natural gas in gaseous form. This makes it easy to transport and store.
Volatility in prices of gasoline and diesel led by geopolitical factors and environment-related concerns has prompted companies to adopt the LNG-based technology. Companies are investing in R&D activities to develop cutting-edge technologies related to LNG and its uses.

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Increase in awareness about environment-related issues and implementation of stringent rules and regulations by regulatory authorities of governments have compelled companies to seek green solutions. Of late, LNG is being used as a substitute for gasoline and diesel. LNG is a clean fuel. LNG offers a cost-effective solution to consumers. Thus, significant increase in the usage of LNG in various industries is expected to drive the global LNG liquefaction equipment market in the near future.
LNG is considered a clean and safe form of energy. Furthermore, easy transportation of LNG is anticipated to drive the LNG liquefaction equipment market. Increase in usage of LNG would lead to higher demand for its transportation. This is estimated to boost the market significantly during the forecast period.
Installation and operating cost of LNG liquefaction equipment is high. As a result, companies are hesitant to invest in LNG liquefaction equipment. This is likely to restrain the market in the near future.

The global LNG liquefaction equipment market can be segmented in terms of type and capacity.
Based on type, the global LNG liquefaction equipment market can be divided into heat exchanger, compressor, and others. Demand for compressor type of LNG liquefaction equipment is expected to be high among end-users, as it provides operational simplicity and flexibility.
In terms of capacity, the global LNG liquefaction equipment market can be classified into less than 0.25 MTPA, 0.25 MTPA to 2.0 MTPA, and more than 2.0 MTPA. Demand for LNG liquefaction equipment with capacity of 0.25 MTPA to 2.0 MTPA is anticipated to be high, as these are employed in industrial applications.

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Based on region, the global LNG liquefaction equipment market can be segregated into North America, Asia Pacific, Europe, Latin America, and Middle East & Africa

Asia Pacific is likely to dominate the global LNG liquefaction equipment market during the forecast period, due to increase in demand for LNG in industrial and commercial sectors in the region. China, India, and Japan are leading countries in the region in terms of demand for LNG liquefaction equipment.
North America is projected to account for large share of the global LNG liquefaction equipment market in the near future. The U.S. is estimated to hold significant share of the LNG liquefaction equipment market in North America during the forecast period.
In terms of revenue, Europe is projected to contribute significantly to the global LNG liquefaction equipment market in the near future. Increase in demand for green fuel is expected to drive the LNG liquefaction equipment market in the region.

REQUEST FOR COVID19 IMPACT ANALYSIS –

The global coronavirus pandemic has led to imposition of lockdowns in many countries. The pandemic has severely hampered the global economy. During the initial stages of lockdowns, demand for LNG declined significantly; however, it is gradually rising as governments of various countries are in the process of lifting certain restrictions. Demand for LNG is rising in industrial applications across the world. Demand for LNG liquefaction equipment is dependent on the demand for LNG.