Natural Gas Storage Infrastructure

Abstract

BCC Research has completed this study on the demand for natural gas and LNG storage infrastructure. The goals of this report are to: Anticipate gas supply drivers and trends, including technology shifts; evaluate pricing trends for key North American and European wholesale gas markets; assess the impacts of new and proposed infrastructure on LNG and underground gas storage projects, and determine their effects on the market; quantify the impact of new technologies, industry structure, business trends, and regulatory change; identify the key structural and strategic factors that will drive growth and opportunity in the LNG and natural gas storage industry to 2010; and provide details on the various technologies involved in LNG and natural gas storage including the critical stages of integration and how they relate to the global natural gas trade and demand pattern.

The objective of this market research report is to provide a balanced and detailed evaluation of the current status of the global LNG and natural gas storage infrastructure industry.

Ninety-eight percent of all LNG traded worldwide is transported by ship. Driven by increasing global demand and decreasing costs, is it any wonder that LNG storage and shipping are being thrown into the limelight? More and more, industry players are realizing that LNG storage and shipping is more than just an integral part of the LNG supply chain. To put it simply, getting storage and shipping right is critical to your business.

The natural gas crisis between Russia and Ukraine at the beginning of January 2006 highlighted the importance of natural gas storage (energy) security in the region and Europe. This is illustrated in the case of Turkey. Although the crisis had no immediate fallout in Turkey, the country is a major buyer of Russian natural gas and the question mark hovering over Russian supplies brought forward the importance of gas storage in Turkey and national contingency plans.

The consumption of natural gas varies day-to-day and month-to-month. Weather and the demands of electric power generation translate into usage fluctuations. Seasonally the fluctuation is as much as 50%, and short term it can be even more variable. Exact timing, location, and volume of peak demand are unpredictable. Since natural gas is not produced in a way that corresponds to these fluctuations, surplus gas is pumped during slumps in usage into numerous storage facilities (underground and LNG) for use during inevitable surges in consumption. In international trade LNG storage provides the vital link between gas producers and consuming countries. This allows continuous service even when production or pipeline transportation services can not meet demand.

• Assesses and quantifies the current global natural gas and LNG storage market and demand;
• Investigates and evaluates the future global use of storage as a means of primary energy production, through 2010;
• Offers a comprehensive overview and analysis of the global natural gas and LNG storage market;
• Discusses important current and potential environmental regulations that may effect the growth of this market;
• Provides a detailed patent analysis and profiles the top companies in the market.

• Global LNG and natural gas storage infrastructure spending was approximately $22.9 billion in 2005. By 2010, this market will reach nearly $31 billion, an average annual growth rate (AAGR) of 6.2%
• Merchant LNG storages will continue to spearhead growth over the forecast period. These small regasification storage plants are often called "peakshaving plants." Alternatively, the LNG may be transported in special tanker trucks to small facilities where it is stored and regasified as needed. Such facilities are called "satellite plants." The United States, for example, has about 100 LNG satellite and peakshaving plants throughout the country. There is also a growing support for natural gas vehicles (NGV), with their global usage being seen as one of the major pathways to the "hydrogen economy". Worldwide there are now over 3.8 million NGVs on the road
• The deregulation of underground storage has combined with other factors such as the growth in the number of gas-fired electricity generating plants to place a premium on high-deliverability storage facilities. This will maintain a healthy growth in working gas storage investments globally at an AAGR corresponding to 5.4% over the forecast period to 2010.