LNG Marine Engine Market is set to experience sizable growth through 2023 to 2032, driven by the increasing need for less polluting fuels within the maritime shipping industry. Additionally, rising intervention by regulatory bodies such as International Convention for the Prevention of Pollution from Ships is creating further impetus for industry growth.
The growing number of ships equipped with LNG-powered engines has fueled higher investments across infrastructure projects. Shipowners are increasingly focusing on fleet decarbonization through LNG, which is reporting escalating supplies, positively impacting the market prospects.
Given that LNG is non-toxic towards seas and waterways, its infrastructure is rapidly expanding across several ports throughout the world, making the fuel more readily available for maritime ships.
As LNG engines deliver affordable propulsion systems that strictly adhere to all safety guidelines and emission legislations, they are being adopted at a higher rate in commercial power generation. The market is further witnessing a notable demand from the booming maritime tourism sector. Tourists are increasingly flocking to cruise vacations as the relatively more affordable nature of LNG is comparatively driving down ticket prices, which is slated to boost the industry outlook in the long run.
Based on type, the LNG marine engine market from diesel-fired LNG engines is projected to record notable rise, fostered by their large sizes and ability to operate at higher efficiencies. Marine shipping extensively used four-stroke marine diesel engines, specifically in bulk carrier and smaller container ships. Rising emphasis on exhaust gas emissions and fuel consumption will also augment business growth.
North America is estimated to account for a notable share of the global LNG marine engine market by 2032. The revenues are likely to be driven by the mounting of crude oil exports within the region. As per estimates, the US, on average exported nearly 5.97 million barrels per day in 2022, which is 405,000 bpd more than it did in 2021. The growth was driven by an 18% increase in distillate fuel oil export.
The introduction of various sustainability and environmental norms has driven novel investments towards the shipbuilding sector. This has elevated R&D projects in the field of marine engine manufacturing, infusing a positive outlook for industry progression.
Meanwhile, the APAC LNG marine engine market is also expected to build up notable steam through 2032, fueled by expanding number of seaborne trades between several developing nations in the region. With COVID-19 a distant memory, countries across APAC have opened their borders to trade once again, fostering a significant rise in LNG bunkering within the region. This especially more apparent in Singapore, which is home to the largest bunkering port in the world. Meanwhile, Australia is emerging as a leading producer of LNG around the globe, exporting a new record 81.4 million metric tons of LNG back in 2022, which was up by 0.5% yoy.
Leading LNG marine engine market players are actively implementing growth and marketing strategies such as mergers & acquisitions, novel product developments, contracts, and partnerships & collaborations to have a competitive edge over their counterparts. For instance, back in 2021, Rolls-Royce, supplied two of its cutting-edge gas engines, mtu 16V 4000 M55RN to Singapore-based, Sembcorp Marine Integrated Yard, to help with the construction of the world’s first LNG-hybrid-powered tug ship.
Cummins, IHI Corporation (Dai-ichi Life), Yuchai, John Deere, Caterpillar, Scania (Volkswagen Group, Traton), Yanmar, Volvo Penta (AB Volvo), Brunswick Corporation, Anglo Belgian, Turbo, and Deutz are among the leading providers of LNG marine engines in the world.
The Russia-Ukraine conflict has greatly highlighted how important LNG is for the world’s energy commodities mix, with expanding ship fleets creating a notable impetus for LNG bunkering, further reflecting on the need to transition to greener marine fuels as global environmental rules tighten.
While skeptics questioned whether it was a smart idea to move the energy mix to LNG, especially as prices were elevated by the Ukraine invasion, the benefits of LNG for shipping held it in good stead as the fuel offers the industry a tangible way to transition to net-zero greenhouse gas emissions. Risk management & verification firm, DNV, had suggested that the world’s deep-sea LNG fleets would likely reach the 1,000 vessels mark by 2022-end. The projection is supported by the fact that numerous shipping firms as well as charterers across Asia are also embracing LNG-powered ships.