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The Floating Storage Regasification Unit (FSRU) Market size is estimated to increase by 805.25 million, at a CAGR of 7.88% between 2022 and 2027. The growth of the market depends on several factors, cost competitiveness of FSRU, increase in offshore gas exploration, and extensive use of natural gas in the transportation sector
It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
Floating Storage Regasification Unit (FSRU) Market Forecast 2023-2027
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Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The cost competitiveness of FSRU is the key driver for the growth market. An FSRU mainly uses a hybrid ship for the transportation of LNG from its production plant to different regions across the globe. These ships offer a major solution to problems such as shortage of fuel and help in meeting the power requirements across various end-users. Additionally, they offer quick transportation of LNG, which grow the rate of adoption. Natural gas that is extracted from the producing gas field is called feed gas. The liquefaction process is done after the liquids and impurities are extracted.
Moreover, With high capital costs conventional liquefaction plants are large custom-built facilities. Hence, liquefaction is the most expensive procedure in the LNG value chain. This raised capital costs of liquefaction plants owing to the long development cycles. However, they offer a fast, affordable, and flexible mode of transport of natural gas to customers. According to the IEA, the cost of building an FSRU with all necessary facilities is 40%-50% less compared to the price of an onshore LNG facility. This competitive advantage offered by an FSRU and rising the rate of adoption of clean fuels are expected to drive the growth of the market during the forecast period.
Stabilization of crude oil prices is the key trend in the global market. Crude oil prices, from 2014 to 2020, the crude oil per barrel did not experience any reduction globally, but crude oil prices continued to show fluctuation. Such fluctuations impact E and P activities as they usually depend upon the profit of the industry. The fall of crude oil prices in 2014 and 2020 led to a number of E and P activities which put on hold.
Moreover, the data provided by the IEA shows that the price of crude oil has stabilized after its fall to a price where production activities are profitable. The stabilization of prices in crude oil indicates that E and P activities have been stopped. According to the IEA, natural gas is expected to account for more than 25% of the global energy demand by 2040. This prediction of the growth of natural gas is expected to support the growth of the global market during the forecast period.
Growth in the number of alternatives is the major challenge for the growth of the global market. The processes and floating storage offloading (FSO), and floating production storage and offloading (FPSO), are included in the Offshore transportation of LNG. The rapid development of the fleet, less investment, easy relocation to other fields, and low cost of abandonment are the benefits provided by FPSO. These FPSO units also provide storage and processing of produced hydrocarbons.
Furthermore, these alternate LNG transportation methods are mostly used for offshore storage and transfer. The additional equipment and safety procedures used to avoid leaks during regasification raise the overall cost of ownership. Hence, the high rate of adoption of FSO and FPSO is expected to restrict the growth of the market during the forecast period.
The power generation segment will account for a major share of the market's growth during the forecast period. The transportation of LNG using floating storage and offloading vessels (FSO), floating production storage and offloading (FPSO), and they are showing rapid growth due to the rising demand for LNG globally. To support this rising, LNG transport vessel vendors are implementing the construction of a floating power plant. Through these, they will generate power using LNG as a fuel. These concepts are being introduced in the LNG market to support the transition from conventional fuels. accommodate LNG for power generation need both infrastructure and technological changes.
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The power generation segment was valued at USD 887.31 million in 2017 and continued to grow until 2021.? According to the International Energy Agency (IEA), coal is mainly dominated the global power industry, with a share of over 40% in 2021. However, in the peak electricity requirement season, extensive use of coal results in quick aging of the plant, thereby reducing the overall lifetime. Natural gas does not face this issue. The demand for LNG has raise due to the deployment of FSRU, specifically in Asia and Europe, and fulfills the need for supplying natural gas to improve the efficiency of power generation projects across the world. Hence because of these factors is expected to fuel the growth of the FSRU market during the forecast period.
Based on type, the market has been segmented into newly built and converted. The roadways?segment will account for the largest share of this segment.? Newly built are rapidly gaining a grip as a leading type in the global market. As compared to older units, these offer cutting-edge technology, increased efficiency, and greater operational capabilities. Features such as higher regasification capacities, optimized storage capacities, and enhanced safety are just a few features of newly built FSRUs. Their capacity to stick to strict environmental laws as well as provide adaptable and scalable solutions makes them the perfect choice for countries such as US and UK. All these factors are expected to propel the growth of the market in focus during the forecast period.
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APAC is estimated to contribute 41% to the growth by 2027. Technavio’s analysts have elaborately explained the regional trends, drivers, and challenges that are expected to shape the market during the forecast period. Another region offering significant growth opportunities to vendors is the Middle East and Africa. The market in MEA is rapidly growing owing to the initiation of many projects in the region. In 2022, the major countries that are employed in MEA are Egypt, Ghana, UAE, and Kuwait. In addition, the UAE is a significant contributor to the market in MEA. Many drilling projects have been started in the country's capital. Abu Dhabi. Hence, the rising number of oil and gas projects in the MEA is driving the market in the region.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market players, including:
Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies vendors based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Vendors are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the market growth and trends opportunities from 2017 to 2027.
The Market has been significantly impacted by the outbreak of the COVID-19 pandemic, leading to the suspension of activities in the energy sector and marine sector. Social distancing measures and lockdowns have disrupted national and international transport and supply chains, affecting the implementation of gas-to-power projects and the demand for liquefied natural gas (LNG).
Despite these challenges, there is a growing interest in environment-friendly LNG and the use of FSRUs as a cost-effective and flexible solution for LNG storage and regasification. FSRUs offer commercial flexibility, low carbon emissions, and are considered an inexpensive alternative to traditional LNG terminals. However, restraints such as the high cost of production, volatility in the oil & gas industry, and capacity storage limitations in oceanic channels pose challenges to market growth.
Market estimations suggest that the market will continue to grow, with significant investment pockets and opportunities for competitive analysis and product segments within the energy sector.
Floating Storage Regasification Unit (FSRU) Market Scope |
|
Report Coverage |
Details |
Page number |
167 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7.88% |
Market growth 2023-2027 |
USD 805.25 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
7.31 |
Regional analysis |
Middle East and Africa, APAC, Europe, North America, and South America |
Performing market contribution |
APAC at 41% |
Key countries |
US, Iran, Qatar, China, and Russia |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
BUMI ARMADA BERHAD, BW Group, Dynagas Ltd., Eni SpA, Excelerate Energy Inc., Exmar NV, Flex LNG Ltd., Golar LNG Ltd., H Energy Group of Companies, Hoegh LNG Holdings Ltd., Jaya Samudra Karunia Group, Karadeniz Holding A.S., LNG Hrvatska d.o.o, MITSUI and CO. LTD., OLT Offshore LNG Toscana Spa, RWE AG, SENER GRUPO DE INGENIERIA SA, Swan Energy Ltd., Teekay Corp., and Trafigura Group Pte. Ltd. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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