United Kingdom LNG Market

UK LNG Market Analysis

The United Kingdom LNG Market is expected to register a CAGR of less than 8% during the forecast period.

COVID-19 negatively impacted the market in 2020. Presently the market has now reached pre-pandemic levels.

• In the medium term, the increasing import volume of liquefied natural gas (LNG) in the country to drive the market is expected to drive the United Kingdom LNG market during the forecast period.
• On the other hand, LNG storage tanks at European regasification terminals, particularly in the United Kingdom, reached 'tank-top,' a number of buyers claimed force majeure, citing that they were physically unable to receive any more LNG, thus negatively impacting the market.
• Nevertheless, a high number of LNG regasification projects/development plans are expected to be proposed in upcoming years, underpinned by the growing LNG demand, leading to the creation of several opportunities for the market players in the United Kingdom, thus, making an emerging LNG market.

UK LNG Market Trends

Transportation Segment to dominate the market during the forecast period.

• LNG represents a potential economic and environmental advantage over diesel and fuel oil for transportation fuels for automobiles, trucks, and ships.
• It is estimated that more than 700 commercial vehicles in the United Kingdom are powered by CNG (compressed natural gas) or LNG (liquefied natural gas).
• Gas vehicles are the best solution for road haulage and heavy vehicles. A joined-up strategy and investment in infrastructure will be required to maximize gas-powered vehicles' potential. The technology is ready, the UK has an extensive and world-class gas infrastructure, and it is simply the most appropriate solution for this industry.
• As the demand for LNG continues to grow in the haulage industry, particularly for long-haul vehicles, companies continue to invest in their LNG refueling network. Compared to conventional fuels such as diesel, LNG emits significantly less carbon dioxide and dramatically less dangerous particulates such as NOx and SOx.
• In June 2022, DHL Supply Chain UK introduced 20 bio-liquefied natural gas (LNG) trucks to the Marks & Spencer fleet, replacing 20 diesel vehicles. The new vehicles will reduce carbon emissions by approximately 80% when fuelled with bio-LNG and 10-20% when fuelled with fossil gas. Replacing 20 diesel trucks with bio-LNG will reduce carbon emissions in the M&S fleet by approximately 2,200 tons a year.
• Considering the LNG demand from transportation leads to more natural gas consumption in the country, according to the BP Statistical Review of World Energy, the total consumption increased from 72 billion cubic meters in 2015 to about 76.90 billion cubic meters in 2021.
• Therefore, based on the above-mentioned factors, the transportation sector is expected to dominate the United Kingdom LNG market during the forecast period.

Increasing import volume of liquefied natural gas (LNG) to drive the market

• In the United Kingdom, there is an existing infrastructure of LNG, and it is expected to grow as the country is dependent on LNG imports for heating and electricity purposes, the price competitiveness of LNG compared to other fuels, and low carbon emission associated with natural gas.
• In the United Kingdom, LNG has gained significant momentum in recent years. The Isle of Grain LNG terminal was the first LNG receiving terminal in the country to offer LNG reloading services in 2015 and subsequently launched a consultation to offer small-scale ship reloading. Transportation of LNG through trucks has also gained significant momentum in the country in recent years.
• However, the trade of liquefied natural gas increased drastically from North America and the Middle East after the Ukraine and Russia wars, as the wars banned imports from Russia. It further lowered the total recording imports. According to the United Kingdom's Department for Business, Energy and Industrial Strategy, the total imports increased from 48,243.05 million cubic meters in 2016 to about 51,350 million cubic meters in 2021.
• Furthermore, this increased the demand for LNG trucks to transport LNG from receiving terminals to various end-users. For instance, according to the International Group of Liquefied Natural Gas Importers (GIIGNL), the truck loading of LNG increased from 87,542 cubic meters in 2020 to about 130,605 cubic meters in 2021.
• In November 2022, Qatar is investing millions of pounds in the expansion of a significant gas terminal in Wales, which is becoming increasingly dependent upon imports of liquefied fuel from abroad as it becomes more dependent on imports of liquefied fuel. In order to accommodate 25% more liquefied natural gas (LNG) imports from around the world, Qatar is upgrading its import facility located on the south coast of Wales.
• Overall, the growing imports of LNG will likely boost LNG business in the United Kingdom during the study period.

UK LNG Industry Overview

The United Kingdom LNG market is fragmented. Some of the major players include Dragon LNG, Ramboll Group A/S, South Hook LNG Terminal Ltd., Npower Limited, and Électricité de France, among others.

UK LNG Market Leaders

UK LNG Market News

• In August 2022, Houston-based Delfin LNG signed a deal to supply LNG to a United Kingdom energy company that plans to construct a floating LNG export terminal off Louisiana's coast. This agreement involves Delfin LNG providing 1 million metric tons of LNG annually to Centrica, an energy company located in Windsor, England, which owns British Gas and Bord Gais Energy.