Natural Gas Storage Market

Overview of Natural Gas Storage Tank Market:

Natural Gas Storage Tank Market at USD 501 Billion in 2024 and it is expected to reach USD 641.3 Billion by 2030 with a CAGR of 4.2% over the forecast period. Anticipate market expansion fueled by the rising hunger for natural gas, heightened supply flexibility, and the ever-growing embrace of cutting-edge technology.

Scope of Natural Gas Storage Tank Market Report-

The scope of the natural gas storage tank market is influenced by various factors, including the growing demand for natural gas as an energy source, the need for reliable storage solutions, and the expansion of natural gas infrastructure. A natural gas storage tank, frequently denoted as a natural gas storage facility or reservoir, represents a structure or system designed for the containment and preservation of natural gas. These storage tanks assume a pivotal role within the natural gas supply chain, guaranteeing the dependability and adaptability of this vital energy resource. A range of natural gas storage tank types exists, each tailored to distinct purposes and functions. The two predominant categories of natural gas storage tanks encompass underground natural gas storage tanks and above-ground natural gas storage tanks.

The LNG market is a significant driver of natural gas storage tank demand. LNG is transported and stored in cryogenic tanks to maintain its liquid state, making storage facilities a vital part of the LNG supply chain. The future scope of the global natural gas storage tank market will depend on several factors, including energy policies, technological advancements, and the transition to renewable energy sources.

Market Revenue generation model:

The revenue generation in the natural gas storage tank market is derived from the sale of storage tanks themselves, with additional income sources including installation and construction services, maintenance, and repair contracts, marketing and advertising, Distribution & sales Channels, and after-sales services. They mostly follow distribution channels like direct sales, government contracts tenders, and distribution partners.

Supply Chain Analysis:

A supply chain for the natural gas storage tank involves raw materials and component suppliers, manufacturing, assembly, quality assurance and testing, distribution, retailers, customer purchase, installation, maintenance, regulatory compliance, technology solution providers, after-sales service, government and regulatory bodies and end of product life. This analysis helps stakeholders in the industry understand the efficiency, quality control, cost-effectiveness, and potential vulnerabilities of the supply chain.

Value Chain Analysis:

The value chain model of the global natural gas storage tank market features a complex value chain that encompasses the supply of raw materials, manufacturing, research and development, quality control, operations, installation and maintenance, and regulatory compliance.

For Example, the installation cost of natural gas storage tanks can vary widely depending on factors such as the type of tank, size, location, and associated infrastructure requirements. Additionally, costs can vary by region and over time due to factors like labor costs, materials prices, and regulatory changes.

COVID-19 Impact on the Natural Gas Storage Tank Market:

The COVID-19 pandemic had a significant impact on the natural gas storage tank market. The pandemic caused significant fluctuations in natural gas demand. Initially, demand dropped due to lockdowns and reduced economic activity. This led to decreased utilization of storage tanks as inventories surged. Also, the energy market experienced extreme price volatility during the pandemic. Sharp declines in oil and gas prices affected the profitability of storage operators and influenced investment decisions in storage infrastructure.

Some storage facilities reached their maximum capacity levels as excess gas was stored to address market uncertainties. This raised concerns about the available storage capacity in the event of unexpected supply or demand shocks. According to the U.S. Energy Information Administration (EIA), natural gas consumption in the industrial sector in the U.S. declined by about 9% in 2020 compared to the previous year. The growing demand for natural gas is expected to drive the growth of the global natural gas storage tank market in the coming years. Additionally, the growing LNG trade is also expected to boost the demand for natural gas storage tanks.

Key Players of Global Natural Gas Storage Tank Market Report-

Some major key players for the global Natural Gas Storage Tank Market report cover prominent players like Chart Industries, Inc., Worthington Industries, Air Products and Chemicals, Inc., McDermott International (formerly CB&I), Gazprom Transgaz St. Petersburg, Cheniere Energy, Inc., IHI Corporation, TechnipFMC, Linde plc, Emerson Electric Co., Samsung C&T Corporation, Oneok, Inc., TransCanada Corporation (now TC Energy), Royal Vopak, Mitsubishi Heavy Industries, Ltd., Saipem S.p.A., Dominion Energy, Inc., Cameron LNG, Kiewit Corporation, Oiltanking GmbH.and others.

Market Drivers:

Increasing Demand for Natural Gas Accelerates the Growth of Natural Gas Storage Tank Market

The increasing demand for natural gas fuels the growth of the Natural Gas Storage Tank Market in several significant ways. Firstly, as the world undergoes an energy transition toward cleaner and more sustainable sources, natural gas is recognized as a bridge fuel due to its lower emissions compared to other fossil fuels. This transition propels the demand for natural gas storage infrastructure to ensure a stable and reliable supply of this cleaner energy source. For example, in 2019, there was an increase in demand of more than 55 billion cubic meters (bcm) attributed to the shift from coal to gas for fuel, and an additional 50 bcm due to market expansion. Secondly, natural gas demand experiences fluctuations throughout the year, with peaks during winter for heating and in summer for cooling. Storage tanks play a crucial role in balancing this seasonal demand by storing excess natural gas during periods of lower consumption and releasing it when demand surges, thereby ensuring a continuous and reliable energy supply. Additionally, the growth of natural gas in power generation, industrial processes, and transportation further drives the need for storage capacity to meet the diverse requirements of these sectors. This increased demand fosters opportunities for innovation in storage tank technologies, ultimately fueling the expansion of the natural gas storage tank market.

Technological Advancement Propel the Expansion of Global Natural Gas Storage Tank Market

Technological advancements have led to the development of highly efficient insulation materials for natural gas storage tanks, Advanced Cryogenic Tanks, Floating LNG Storage and Regasification Units (FSRUs) and advanced safety features such as real-time monitoring, emergency shutdown systems, and automated leak detection to enhance safety.

Shell's Prelude floating LNG facility is a prime example of technological advancements in natural gas storage and processing. It is the world's largest floating LNG facility, equipped with advanced storage and processing systems. Prelude demonstrates the feasibility and efficiency of using floating LNG storage and processing units to access remote offshore natural gas reserves.

Market Restraints:

Fluctuating Natural Gas Prices Limits the Market Growth

Natural gas prices are a function of market supply and demand. Increases in natural gas supply generally result in lower natural gas prices and decreases in supply tend to lead to higher prices. Increases in demand generally lead to higher prices and decreases in demand tend to lead to lower prices. In April 2020, the Henry Hub natural gas spot price in the U.S. dropped to below US$2 per million British thermal units (MMBtu), down from over US$4 per MMBtu at the beginning of the year. This price fluctuation can affect the growth of the natural gas storage tank market.

Regulatory Challenges Led to Delay in Production and Product Launch

Natural gas storage facilities are subject to various environmental regulations aimed at reducing emissions and ensuring the safe operation of these facilities. Stricter emissions standards and environmental regulations can lead to increased compliance costs for storage facilities. An example of regulatory challenges in the natural gas storage industry can be seen in the aftermath of the Aliso Canyon gas leak in California in 2015. This incident, which involved the release of large amounts of methane from a storage facility, led to stricter regulations and scrutiny of natural gas storage operations in the state.

Opportunity Factors:

Renewable Integration and Energy Transition: As the energy transition to renewables accelerates, natural gas can play a crucial role in providing flexible backup power to balance intermittent renewable energy sources. This presents an opportunity for increased natural gas storage capacity to support grid stability. Natural gas Peaker plants can be equipped with advanced storage solutions to rapidly respond to fluctuations in renewable energy generation, ensuring a reliable power supply.

Now, Renewable Integration and Energy Transition is a new opportunity for growing the natural gas storage tank market.

Market Trends:

Digitalization and IoT:

• Digital technologies: The adoption of digital technologies, including the Internet of Things (IoT), is increasing in the monitoring and control of natural gas storage facilities. Real-time data analytics, remote monitoring, and predictive maintenance are becoming standard practices to optimize operations and safety.
• Recently, Advanced Monitoring and Control Systems are installed in LNG Terminals, and they are critical components of the natural gas supply chain, facilitating the import, storage, and distribution of liquefied natural gas. To enhance safety, efficiency, and reliability in LNG terminals, digitalization and IoT technologies are employed extensively.

Expansion of Underground Storage Facilities:

• Balancing Supply and Demand: Underground storage facilities allow gas to be injected during periods of low demand and withdrawn when demand is high. This helps maintain a consistent and reliable supply of natural gas to meet consumer needs. The Haidach storage facility in Austria is an example of the expansion of underground storage capacity. Since 2011, around 2.9 billion cubic meters of natural gas has been able to hold underground in Haidach and 55% of the total storage capacities are commercialized by astora.

Market Competition Nature:

Present Strategies:

Expansion and Infrastructure Investment: Many companies are expanding their natural gas storage infrastructure, both in terms of capacity and geographic reach. This includes the development of new underground storage facilities and LNG terminals.

Integration of Advanced Technologies: Companies are incorporating advanced technologies such as IoT sensors, real-time monitoring, and data analytics to optimize storage operations, improve safety, and reduce operational costs.

Future Strategies:

Renewable Integration: As renewable energy sources continue to expand; storage companies may develop integrated solutions that combine natural gas storage with renewable energy storage technologies to provide grid-balancing services.

Carbon Capture and Storage (CCS): Future strategies may involve the incorporation of CCS technologies within natural gas storage facilities to capture and store carbon emissions, aligning with global efforts to reduce greenhouse gas emissions.

Geography Analysis:

How the Robust Network of Underground Storage Facilities Drive the Market Growth in North America Region:

In North American region, The United States is a significant player in the global natural gas storage tank market. The country has an extensive network of underground storage facilities, particularly in regions like the Gulf Coast and Midwest. The United States had 625.4 trillion cubic feet (Tcf) of proved natural gas and natural gas plant liquids (NGPLs) reserves as of December 31, 2021, up 32% (152.1 Tcf) from 2020. The EIA also reported that the U.S. had over 430 active underground natural gas storage facilities across the country.

Also, Canada operates several underground natural gas storage facilities, including the Dawn Storage Hub in Ontario. This facility plays a crucial role in meeting seasonal demand variations and ensuring a stable supply of natural gas to Canadian consumers and industries. The Canadian natural gas system has the capacity to store about 850 billion cubic feet (bcf) of natural gas. The market is dominated by countries United States and Canada in the North American region.

How Increasing Demand for Natural Gas Spur the Market Growth in Europe?

Europe has a well-developed and diverse natural gas storage tank market due to its significant reliance on natural gas for energy needs, energy security concerns, and the need to manage seasonal variations in demand for heating and power generation. Europe places a strong emphasis on energy security, given its dependence on gas imports. Natural gas storage tanks, especially underground storage, are critical for maintaining gas supply reliability during disruptions. European countries are working to diversify their gas supply sources, including LNG imports. This requires additional storage capacity to manage LNG imports efficiently.

The European Network of Transmission System Operators for Gas (ENTSOG) reported that as of 2020, Germany had the largest underground gas storage capacity in Europe, followed by Italy and France. These countries invest significantly in storage infrastructure.

Key Benefits of Global Natural Gas Storage Tank Market Report:

• Global Natural Gas Storage Tank Market report covers in-depth historical and forecast analysis.
• Global Natural Gas Storage Tank Market research report provides detailed information about Market Introduction, Market Summary, Global market Revenue (Revenue USD), Market Drivers, Market Restraints, Market Opportunities, Competitive Analysis, and Regional and Country Level.
• Global Natural Gas Storage Tank Market report helps to identify opportunities in the marketplace.
• Global Natural Gas Storage Tank Market report covers extensive analysis of emerging trends and competitive landscape.

Global Natural Gas Storage Tank Market Segmentation:

By Type:

• Underground storage tanks
• Above ground storage tanks

By Material:

• Steel
• Concrete
• Lined
• Others

By Storage Capacity:

• Large-Scale Tanks
• Small-Scale Tanks

By End-use:

• Industrial and Commercial
• Residential
• Utility
• Transportation

By Regional & Country Level:

• North America
  • S.
  • Canada
• Europe
  • K.
  • France
  • Germany
  • Italy
• Asia Pacific
  • China
  • Japan
  • India
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • GCC
  • Africa
  • Rest of Middle East and Africa