Cedigaz studies LNG in transportation

Cedigaz studies LNG in transportation

Cedigaz, the international association for natural gas, released a new study called “LNG in transportation” that looks into the prospects for LNG as fuel as well as market drivers, perspectives, existing and planned infrastructure.


LNG as a potential transport fuel, especially in shipping and trucking, is attracting considerable interest. This is mainly a reflection of the price advantage of LNG over oil based fuels, especially in the US where the shale gas revolution has driven gas prices to record lows. In the marine sector, the reinforcement of emissions regulations will force ship-owners to move to less polluting fuels or technology and LNG has a number of advantages over other compliance solutions. However, the development of LNG as a transport fuel faces a number of challenges and will have to go hand in hand with the development of fuelling infrastructure.

The study finds that the greatest potential is seen in road transport, were annual demand is projected to reach 96 million tons per year (mtpa) in 2035 in CEDIGAZ’ base scenario while demand in the marine sector could grow to an estimated 77 mtpa. The rail sector could add another 6 mtpa to global demand.

“Use of LNG in land transport will be largely limited to heavy duty vehicles (HDV) and will essentially be driven by the difference between the price of diesel and that of LNG,” stands in the study. In contrast with the marine sector, environmental legislation is unlikely to play a major role. However, the cost advantage of LNG relative to diesel currently provides a strong economic incentive in the trucking industry. With the world’s largest inland goods transport market and an already well developed LNG supply infrastructure, China has a huge potential and should represent almost half of the global market in 2035. LNG should also carve out a significant market share in the US, Europe and the rest of Asia.

“There is little doubt that the use of LNG as a fuel will grow in the marine sector, though the rate and pace of growth will be highly dependent on the timing and geographical scope of emissions restrictions set out in the MARPOL treaty. Compliance with the new emissions limits will require either: to switch to cleaner but more expensive oil-based fuels, to implement costly flue gas treatment technologies, or to switch to LNG. Economic analysis taking into account all relevant factors shows LNG to be a very attractive solution when compared to other compliance solutions,” study shows.

The study also shows that rail has a relatively low share of energy consumption in the transport sector. In addition, the potential for LNG in the rail sector is likely to be most evident in countries with high levels of long haul freight and low level of penetration of electric powered traction in the freight sector, conditions found in relatively few countries.

 

LNG World News Staff, September 29, 2014

Share this article

Follow LNG World News

One thought on “Cedigaz studies LNG in transportation”

  1. Pingback: andrew

Comments are closed.

Events>

<< Sep 2017 >>
MTWTFSS
28 29 30 31 1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 1

LNG BUNKERING MED

The only 3 day course offering theoretical and practical training on LNG bunkering for the Mediterranean market, the syllabus is accredited…

read more >

International Gas Cooperation Summit (IGCS)

The International Gas Cooperation Summit (IGCS) is a platform for South Africa’s aspirations to build an energy hub for gas cooperation…

read more >

Budapest LNG Summit

Budapest LNG Summit is a niche event focused on the up and coming LNG  region of Central & Eastern Europe (CEE).

read more >

Mozambique Gas Summit & Exhibition

Now in its fourth edition, the Mozambique Gas Summit & Exhibition is recognized as the leading strategic meeting for Mozambique’s gas industry…

read more >