Floating LNG Power Vessel Market

[113 Report Pages] The global floating LNG power vessel market was valued at USD 484.8 million in 2017 and is projected to reach USD 931.6 million by 2023, at a CAGR of 1.61% during the forecast period. The years considered for the study are as follows:

• Base Year: 2017
• Estimated Year: 2018
• Projected Year: 2023
• Forecast Period: 2018–2023

The base year considered for company profiles is 2017. Whenever information was unavailable for the base year, the previous year was considered.

Objectives of the Study

• To define and segment the floating LNG power vessel market by component, power output, vessel type, and region
• To provide detailed information about major factors influencing the growth of the market (drivers, restraints, opportunities, and industry-specific challenges)
• To strategically analyze the market with respect to individual growth trends, future expansions, and contributions to the market
• To analyze market opportunities for stakeholders and details of a competitive landscape for market leaders
• To forecast the growth of the market with respect to the major regions (Asia Pacific, the Middle East & Africa, North America, and RoW)
• To strategically profile key players and comprehensively analyze their market rankings and core competencies
• To analyze competitive developments such as new product development, mergers & acquisitions, expansions & investments, and contracts & agreements in the market

Research Methodology

This research study involved the use of extensive secondary sources, directories, journals on power generation technologies and other related rental markets, newsletters and databases such as Hoover’s, Bloomberg, Businessweek, and Factiva to identify and collect information useful for a technical, market-oriented, and commercial study of the global floating LNG power vessel market. The primary sources include several industry experts from the core and related industries, vendors, preferred suppliers, technology developers, alliances, and organizations related to all the segments of this industry’s value chain. The research methodology has been explained below.

• Study of annual revenues and market developments of major players in floating LNG power vessel
• Analysis of the major end-users and applications of floating LNG power vessel
• Assessment of future trends and growth of market on the basis of investments
• Study of contracts & developments related to the market by key players across different regions
• Finalization of the overall market size by triangulating the supply-side data, which includes product developments, supply chains, and annual revenues of companies manufacturing floating LNG power vessel across the globe  

After arriving at the overall market size, the floating LNG power vessel market was split into several segments and subsegments. The figure given below illustrates the breakdown of primary interviews conducted during the research study on the basis of company type, designation, and region.

To know about the assumptions considered for the study, download the pdf brochure

The major players operating in the floating LNG power vessel market include Siemens AG (Germany), MAN Diesel & Turbo SE (Germany), Wärtsilä Corporation (Finland), General Electric Company (US), and Caterpillar Inc. (US).

Target Audience:

• Banks, venture capitalists, financial institutions, and other investors
• Consulting companies of the energy and power sector
• Electric utilities
• Electrical infrastructure providers
• Government and research organizations
• Industry, energy, and environmental associations
• Power distribution equipment manufacturers
• Power generation equipment manufacturers
• Public and private operators of power barges and power ships

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Scope of the Report

:

By Vessel Type

• Power Barge
• Power Ship

By Component

• Power Generation System
  • Gas Turbine & IC Engine
  • Steam Turbine & Generator
• Power Distribution System
  • Transformer
  • Switchboard

By Power Output

• Small Scale (Up to 72 MW)
• Medium Scale (72 MW to 400 MW)
• High Scale (Above 400 MW)

By Region

• Asia Pacific
• North America
• Middle East & Africa
• RoW

Available Customizations:

With the given market data, MarketsandMarkets offers customizations as per the client’s specific needs. The following customization options are available for this report:

Company Information

Detailed analyses and profiling of additional market players (up to five).

Drivers

Increasing demand for power, coupled with the lack of power infrastructure

The demand for power in the industrial sector exceeds the supply. Several industries are facing an acute shortage of power. The governments are therefore encouraging and mandating efficient power consumption for the industrial sector to reduce the demand and supply gap. Additional power plants have also been set up as a permanent power solution. However, establishing permanent power plants is capital-intensive and time-consuming. Such government initiatives have increased the demand for power. However, the grid infrastructure, particularly in most of the developing countries, is unable to meet the increasing demand for power. Several countries in the Asia Pacific, the Middle East, Africa, and South America have seen poor planning and shortfall in capital expenditure, which has created market opportunities for temporary power solutions and accentuated the need for non-renewable floating power plants. The lack of infrastructure has thus increased the demand for floating power plant solutions.

Benefits over land-based power plants

The average age of a power plant is estimated to be 40 years. Post decommissioning, a power plant leaves behind toxic residues, unfading fuel stains, and other forms of pollution that cannot be completely cleaned. Thus, power plant sites, which are polluted by the toxic residues, are sealed off from any further land use. Such degradation of land can be avoided with the help of floating LNG power vessel. According to research, floating power plants are safe from the effects of earthquakes and tsunamis, as the stretch of the ocean would shield the plant from seismic waves. When the floating power plants are moored in about 100 meters of water, the intensity of the tsunami is expected not to cause any serious damage. Thus, floating power plants can help to avoid accidents, such as the Fukushima Daiichi nuclear disaster in Japan in 2011 and the geothermal power plant damage in the Philippines in 2017. These benefits of floating power plants over land-based power plants are expected to drive the floating LNG power vessel market.

Restraints

High operating cost associated with transportation, logistics, & accessibility issues

Floating power plants, which are situated over water bodies, can be damaged by the harsh environment conditions. Any damage to equipment would require maintenance, which is slightly more expensive than that of land-based power plants. Also, floating power plants are usually located dozens of miles away from the shore and are difficult to access, especially in bad weather. So, rectifying a minor technical issue can be tricky and incurs a huge cost. The challenges with maintenance are higher in case of power ships based floating power plants when compared with power barge based power plants. Power ships based power plants have units located at the base of the ship. Thus, the maintenance and repair related issues would increase the non-productive time of the power plant. Other challenging factors in the floating power plant market are the grid interconnection and operation and the development of transmission infrastructure, which is simpler in onshore power plant installations. The high operating cost and issues associated with the operation, maintenance, and transportation and logistics can hinder the growth of the floating power plant market.

Price disparity across regional markets

Gas importers face disparity in prices as the production and supply of most of the world’s natural gas is concentrated in a few countries. While 40% of the total global natural gas production comes from the US and Russia, nearly two-thirds of the total global reserves are located in Russia, Iran, and Qatar. The trade of liquefied natural gas (LNG) is highly localized with only 14% traded in international markets, compared to more than 70% of crude oil. Hence, pricing negotiations are mostly carried out in a confidential manner for large supply agreements, such as the one between Russia's Gazprom and China National Petroleum Corporation (CNPC) in 2014. Utilities in North America pay a much lower cost for natural gas than those in other countries that heavily depend on imports, such as India. India has a natural gas-fired power plant capacity of nearly 24,000 MW, only 20% of which was operational in 2014 due to the high cost of imported natural gas. As a result, the price disparity in the international trade of natural gas is a restraint for the floating LNG Power Vessel market.

Competitive Landscape

Contracts & Agreements

Note: The developments mentioned above are for floating LNG power vessel manufacturers.
Source: Company Websites and Press Releases

New Product Launches

Note: The developments mentioned above are for the floating LNG power vessel manufacturers
Source: Company Websites and Press Releases

Partnerships, Collaborations, Alliances, And Joint Ventures

Note: The developments mentioned above are for floating LNG power vessel manufacturers.
Source: Company Websites and Press Releases

The global floating LNG power vessel market is projected to reach a market size of USD 931.6 million by 2023 from an estimated USD 860.1 million in 2018, at a CAGR of 1.61%. This growth can be attributed to the increasing demand for power, lack of power infrastructure, and added benefits over land-based power plants.

The report segments the floating LNG power vessel, by vessel type, into power barge and power ship. The power ship segment is expected to hold the largest market share by 2023. The power ship is generally used in the energy leasing market for short- and mid-term contracts because of its self-propelling property. Karadeniz Holding (Turkey) dominates the supply of power ships in the market. Most of the projects use power between 100 MW and 150 MW and run on liquid fuel or natural gas, which are expected to witness high growth in the market.

The floating LNG power vessel, by component, is segmented into the power generation system and power distribution system. The power generation system segment is expected to dominate the floating LNG power vessel market by 2023. It is further classified into gas turbine & IC engine and steam turbine & generator. Gas turbine & IC engine are the two key components in the floating power generation system market. The gas engine technologies can be connected to the existing gas pipeline system to avoid diesel fuel supply issues that occur during natural calamities, whereas IC engines are used in floating LNG power applications with a power output between 5.0 MW and 20.0 MW.

In this report, the floating LNG power vessel market has been analyzed with respect to 4 regions, namely, North America, the Middle East & Africa, Asia Pacific, and the RoW. The Asia Pacific market is estimated to be the largest floating LNG power vessels market from 2018 to 2023. The growth of population in the Asia Pacific region has increased the demand for electricity, which is one of the major factors driving the floating LNG power vessels market. Also, the governments of several countries are spending heavily to meet the increased demand for power. For instance, Karpowership, one of the leading players in the power ship market, was awarded a contract by Myanmar Electric Power Generation Enterprise to provide an FPP in Rangoon, Myanmar. Such activities are expected to drive the floating LNG power vessel market in the region.

The high capital cost associated with the operations, maintenance, transportation, and logistics, price disparity across regional markets, and increasing focus on renewable energy could act as restraints for the market. The leading players in the floating LNG power vessel market include Siemens AG (Germany), MAN Diesel & Turbo SE (Germany), Wärtsilä Corporation (Finland), General Electric Company (US), and Caterpillar Inc. (US). Contracts & agreements is the most commonly adopted strategy by the top players. It is followed by new product launches and partnerships, collaborations, alliances, and joint ventures.

Opportunities

Stringent emission norms for diesel engine powered marine gensets & rise in hybrid fuel engines

The demand for marine gensets operating on diesel fuel oil as well as natural gas (LNG) has increased. The gas and fuel oil hybrid increases fuel efficiency and lowers the cost of operations. The maintenance cost of operating hybrid gensets is also lesser as compared to single fuel oil powered marine genset. Operation & maintenance costs are an important factor for the end-user. Lower emissions than only-diesel gensets is another advantage of hybrid-fuel powered marine gensets, especially the ones with natural gas and diesel fuel option. Hybrid gensets produce a less volume of sulfur oxides (SOx) as well as NOx and particulate matter emissions. These advantages along with stringent emission norms have increased the demand for hybrid-fuel powered marine gensets and have created new opportunities for the component manufacturers in the floating LNG Power Vessel market.

Growth in adoption of LNG as an energy source

According to the International Energy Outlook 2017 (IEO2017), the world’s natural gas producers are expected to increase supplies by 42% from 2015 to 2040. In Russia, the production of natural gas is expected to increase mainly due to increasing development of resources in the country’s Arctic and eastern regions. The US production growth is mainly from shale resources. In China, production would increase due to the development of shale resources, which are projected to account for over half of the country’s total natural gas production by 2040. The comparatively lesser emissions of natural gas-fired power plants at costs that are lower than renewable energy generation are providing an alternative to utilities facing stringent emission regulations. Utilities in the US have responded to the tough emission regulations on coal plants by switching to natural gas-fired power generation. Policy makers are also seeking to leverage gas-fired plants as an option to help reduce overall emissions in the near term. Cleaner gas-fired electricity generation is expected to drive the LNG power generation market. The benefits of floating power plants would provide a growth opportunity for the floating LNG power vessel market.

Challenges

Growth in distributed energy generation

Distributed generation is the act of power generation carried out at or close to the point of end-use. Distributed generation systems are generally defined as being less than 100 MW in capacity (typically less than 50 MW) and can be stationary as well as mobile in nature. Distributed power technology includes solar panels, gas and diesel engines, small wind turbines, fuel cells, and gas turbines. The demand for energy from distributed energy resources has grown globally due to several reasons, such as planned rolling blackouts, power quality problems, unexpected utility power outages, and increases in power costs. Instead of relying totally on utilities for power needs, end-users, which include residential, commercial, and industrial customers, have started generating power from distributed energy sources. This approach is backed by incentives offered by governments, such as net metering and feed-in tariffs, among others. The General Electric Company (U.S.) estimates that annual distributed power capacity additions will rise from 142 GW in 2012 to 200 GW by 2020, while investments in distributed power technologies will grow to USD 206 billion by 2020. Meanwhile, utilities have also started shifting their business models from directly selling electricity to involving end-users as a part of their business to cater to the peak demand without large-scale capacity additions. This, in turn, will eliminate the need for the construction of a new power plant. Hence, the distributed generation resources could pose a challenge for the floating LNG Power Vessel market.

Gas Turbine

Note: The list mentioned are for companies which provide these components. They may or may not operate in the floating power plant industry.

Steam Turbine

Note: The list mentioned are for companies which provide these components. They may or may not operate in the floating power plant industry.

Power Transformers

Note: The list mentioned are for companies which provide these components. They may or may not operate in the floating power plant industry.

Switchboard

Note: The list mentioned are for companies which provide these components. They may or may not operate in the floating power plant industry.

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