The global LNG supply chain has been through a major transformation: restructurings, ramifying process technologies, the rise of BAHXs, and for the first time in 2025+, a truly integrated equipment supplier. Are terms of trade improving for project developers? Who wins future order flow? This 16-page report contains our outlook.
Our long-term gas outlook sees rising energy demand, excellent economics of gas-fired power, clear signs of LNG under-supply, and the maturation of China’s coal resources, as outlined on pages 2-3.
Hence, global LNG markets will add +30MTpa/year of new LNG capacity on average, to reach 1.1GTpa by 2050, including a 50-60MTpa/year boom in 2027-30, trebling global LNG capex to $60bn pa, as shown on pages 4-6.
Hence, who wins the order flow for LNG capex, and how are terms of trade changing across the LNG supply chain? We start by breaking down the costs of LNG projects, down to the major component level, on pages 7-9.
We also compiled a new database of the LNG supply chain by company, showing who has won the contracts for EPC and key equipment, at 50 LNG plants, in the 2014-2030 timeframe, as shown on pages 10-11.
Our conclusions are that global LNG now has a transformed supply chain versus a decade ago. There has been far more change than we realized. We wonder if others may also have missed the extent of the transformation, and what it means?
Certain parts of the supply chain, which were effectively monopolies or duopolies in the past, have seen new technologies and new entrants, thus improving terms of trade for LNG project developers, per pages 12-16.
Other parts of the LNG supply chain remain highly competitive, with just 1-2 main suppliers, and the chance for excess returns, per pages 12-16.
Most exciting is the ramification of process technologies, emergence of BAHX cold boxes, and creation of a truly end-to-end technology and equipment supplier as Baker Hughes acquires Chart Industries, per pages 12-16.