Market Trends of India LNG Bunkering Industry
This section covers the major market trends shaping the India LNG Bunkering Market according to our research experts:
Ferries and OSV Segment is Expected to Witness Significant Growth
- Offshore vessels such as OSVs provide essential support and supplies to exploration & production activities away from shore. These include the supply of crew, equipment & machinery, freshwater, fuel, food, etc.
- Offshore support vessel segment is expected to dominate the market, owing to it being relatively cost-effective in terms of offshore exploration and production activities. According to Baker Hughes, the India offshore rig count was 40 in May 2020.
- With recovering oil prices and rising E&P activities, the future seems secure for offshore supply vessels on the demand side. Going by the number of offshore rigs, there will be an increasing demand for offshore supply vessels, as future exploration is going to be mainly in deep seas globally. However, in India, the share of shallow water fields production would remain substantially high.
- Hence, the country is expected to have a positive demand for Ferries and OSV in the LNG bunkering market, during the forecast period.
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Rise in LNG Bunkering Facilities to Drive the Market
- The reason for rise in LNG bunkering infrastructure can be attributed to the expected increasing LNG bunkering services and preference for LNG over other fuels by ship makers. Furthermore, several ports in the country are looking to develop an LNG fueling infrastructure.
- The rise in demand for natural gas in the country owing to the clean emission is also likely to boost up the use of LNG as a marine fuel in the shipping industry. The natural gas consumption was 59.7 billion cubic meters in 2019. The increasing consumption of natural gas is expected to drive the market further.
- The country is expected to be among the regional hot spots for the LNG bunkering market in the coming years. India has an operational port in Kochi, which is operated by Petronet LNG.
- An inland river cargo terminal to be built at Ghazipur in northern India is expected to have an LNG bunkering facility. The first phase of construction is expected to be completed by 2020.
- Furthermore, another LNG bunker is proposed to be built at Dharamtar Creek near Mumbai, which is estimated to reduce transportation cost significantly for LNG powered vessels plying between Goa and Mumbai.
