Gas Hydrates Market Size, Share & Industry Analysis, By Type (Onshore Gas Hydrates and Offshore/Marine Gas Hydrates), By Origin (Seabed and Permafrost), and Country Forecast, 2024-2032

The global gas hydrates market size was valued at USD 2.20 billion in 2023. The market is projected to be worth USD 2.31 billion in 2024 and reach USD 3.66 billion by 2032, exhibiting a CAGR of 5.94% during the forecast period.

Gas hydrates are crystalline solids composed of water and gas. It looks and acts similar to ice but contains huge amounts of methane. It is known to occur on all continents and is found as a several hundred meters thick layer in huge quantities in marine sediments just below the seabed and with permafrost in the arctic region. Moreover, gas hydrate deposits are found wherever methane occurs in the presence of water at high pressures and relatively low temperatures, such as under permafrost or in shallow sediments at the edges of continental deep seas. Hydrated methane can be a key product that includes both biogenic, produced as a result of biological activity in sediments, and thermogenic, produced as a result of geological processes occurring deeper in the earth.

The global impact of the COVID-19 pandemic on the market was moderate. A great economic shock was felt throughout this period and continued until the end of the year and even during the next year, but the extent of the damage is still uncertain, as is the speed and scale of recovery. Owing to the global lockdowns that resulted from the pandemic, gas consumption and production plummeted, and the prices reached a new record low. As the pandemic started to spread in Europe, gas production went below the 2015- 2019 range, reflecting the decreasing trend of gas production in Europe.

Gas Hydrates Market Trends

Development of Advanced Extraction Technologies for the Product is Surging Market Growth

The development of innovative extraction techniques for the product is an important trend in the market. Ongoing research and technology development aims to improve the efficiency and cost-effectiveness of gas hydrate extraction, including methods such as decompression, thermal stimulation, and CO2 injection. These advances are critical to realizing the commercial potential of gas hydrate reserves. Furthermore, environmental sustainability is the main trend in the market. As concerns about climate change and greenhouse gases increase, there is an increasing emphasis on environmentally sustainable practices in gas hydrate exploration and production. In line with this trend, the goal is to minimize methane emissions from mining, promote carbon capture and storage (CCS) technologies, and implement ecological production processes.

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Gas Hydrates Market Growth Factors

Increasing Government Support for Gas Hydrate Projects to Drive the Market Growth

The gas hydrate project will analyze solid, liquid, and gas samples to determine their chemical composition, stable carbon isotopes, and radiocarbon ages. Fluid samples include seawater containing dissolved compounds or gases and pore water extracted from sediments near gas flows or gas hydrate deposits. The USGS Gas Hydrates Project has contributed to the understanding of the U.S. and international gas hydrate science for at least three decades. The USGS Gas Hydrate Research Group is one of the largest in the U.S. The USGS Gas Hydrates Project focuses on the study of natural gas hydrates in deep-sea systems and permafrost. As part of the ongoing Alaska North Slope study, DOE, in collaboration with the Japan Metals and Energy Safety Organization (JOGMEC); Ministry of Economy, Trade and Industry; U.S. Geological Survey; and Arctic Slope Regional Corporation Energy Services (AES), conducts scientific production trials of gas hydrate-rich sands. Testing is being done under a drilling agreement between AES and Hilcorp Alaska on behalf of the Prudhoe Bay Working Interest Owners and approved by the Alaska Department of Natural Resources. The purpose of this test is to monitor the long-term behaviour of production, assess potential environmental impacts, and develop concepts for efficient gas hydrate well design. The Alaska site offers a unique opportunity to conduct experiments over several months, as the established infrastructure allows continuous access to the site.

             Rising Demand for Clean and Renewable Energy to Fuel the Market Growth

Gas hydrates are part of the global carbon cycle. Methane is the third most common greenhouse gas in the atmosphere after water. Clean energy is one of the most important global needs to meet global energy source demand. Natural gas hydrates (NGH) are one proposed way to release methane as clean energy and sequester carbon dioxide. As a new alternative energy source, gas hydrate has attracted widespread attention worldwide. Because gas hydrate is always associated with free gas, evaluation of the gas hydrate and free gas system is an important consideration in hydrate reservoir research and development. Furthermore, gas hydrate is considered one of the most potential new clean energies to replace coal, oil, and gas in the 21st century, and it is also a new energy with abundant reserves that have not yet been fully exploited. Because natural gas hydrate is a type of clean energy with great potential and positive impact on the greenhouse effect and marine ecosystem, the U.S., Canada, Japan, South Korea, and India are dedicated to its research and development, bolstering the gas hydrate market growth.

RESTRAINING FACTORS

High Production Costs and Complex Processing Techniques May Hamper the Market Growth

Gas hydrate extraction faces several challenges. The complex process of producing gas from hydrate-bearing sediments involves a combination of thermal, hydraulic, chemical, and mechanical factors, making it different from traditional fossil resource extraction. Avoiding the formation of hydrates during production is crucial because removing hydrate plugs is difficult and expensive. However, current solutions for hydrate formation in natural gas pipelines are not sustainable, and sustainable solutions and new technologies must be explored. The development of natural products also requires addressing key issues such as diagenesis, rock structural stability, particle size, and mode of cementation. In addition, the description and quantification of hydrate abundance and the creation of dynamic factors must be improved. Another challenge is methane leakage, especially in oceanic gas hydrate reservoirs with low permeability and permeable boundary layers.

Despite the progress, there are still challenges in basic theoretical research, production methods, and equipment and operation methods. In general, gas hydrate extraction requires addressing these challenges to achieve long-term commercial exploitation.

Gas Hydrates Market Segmentation Analysis

By Type Analysis

Offshore/Marine Gas Hydrates Hold a Dominant Share Due to the Growing Development and Production for Future Energy Source

Based on type, the global gas hydrates market is segmented into onshore gas hydrates and offshore/marine gas hydrates.

Offshore/ marine gas hydrates holds majority of market share and considered to be the fastest growing segment for global gas hydrate market. Large amounts of natural gas are stored in marine gas hydrates that are deposited at the edges of continents. Marine gas hydrates are considered a new energy and are characterized by high energy density, huge amounts of resources, and purification. It is important for resource development, environmental protection, and global climate change. This large marine gas hydrate reservoir is still considered an important part of the global carbon cycle and a future source of energy. Onshore gas hydrates is expected to grow during the forecast period as gas hydrates occur naturally on land in some permafrost regions and in sediments on or under the seabed, where water and gas combine at low temperatures and high pressures to form an icy solid. Methane, an important component of natural gas, is usually the dominant gas in the hydrated structure.

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By Origin Analysis

Permafrost holds the Dominant Market Share Due to Larger Occurrences of Natural Gas Hydrates

Based on origin, the global market is segmented into seabed and permafrost.

Permafrost is dominating the gas hydrate market and is considered to be the fastest growing segment among others as gas hydrates are widespread in the sediments of continental ocean margins and permafrost places where ocean and atmospheric warming can disrupt the hydrate stability field and lead to the release of bound methane into surface sediments and soils. The seabed is expected to dominate the methane hydrate extraction market. Most of the world's methane hydrate occurs on the continental slopes of the sea, where enough organic matter accumulates at the bottom. This provides an opportunity for governments and companies to explore and scale up methane capture widely. Many countries are taking active steps to remove methane hydrate from the seabed.

COUNTRY INSIGHTS

The market has been studied geographically across four main countries: China, the U.S., Japan, and others. The other countries include Germany, Canada, and South Korea.

Based on country, China dominates the gas hydrates market due to the increase in gas hydrate production trials. Over the past years, the country has been preparing for the third round of its offshore gas hydrate production test and completed seismic and environmental surveys in the targeted waters of the South China Sea and the geological design of a new gas hydrate well.

U.S. is expected to hold the second highest market share for gas hydrate market as the USGS Gas Hydrate Project has contributed to the understanding of U.S. and international gas hydrate science for at least three decades. The USGS Gas Hydrate Research Group is one of the largest in the U.S., with expertise in all major geoscience disciplines, including the physics and chemistry of gas hydrates and the geotechnical properties of hydrate-bearing sediments. In January 2024, a long-term onshore methane hydrate production trial began in Prudhoe Bay on the North Slope of Alaska in the U.S. on behalf of the Japan Metals and Energy Security Organization (JOGMEC) and Toyo Engineering Corporation of Japan provide technical support services. JOGMEC formed a consortium (MH21-S RandD Consortium) with the National Institute of Advanced Science and Technology (AIST) and the Japanese Methane Hydrate Operating Company, and the consortium conducted research and development for the future commercial development of methane hydrates agreement with the Ministry of Economy, Trade and Industry of Japan. For Japan, the land production trial in Alaska is one of the country's main pillars in the development of methane hydrate technology to launch a five-year pilot project led by the private sector in the 2027-2028 fiscal year as part of the current government plan.

List of Key Companies in Gas Hydrates Market

Several Players are Launching Pilot Projects to Gain a Competitive Edge

The global gas hydrates market is highly fragmented, with large and medium-sized country players supplying a wide range of products across the value chain at local and national levels. Many companies are actively implementing pilot projects for the production of the product. These players focus on strategic partnerships, new product launches, and commercialization to expand in the market. Moreover, these players invest heavily in research projects that enable them to launch innovative products and gain maximum revenue in the market.

List of Key Companies Profiled:

• Petro China Company Limited (China)


• Japan Petroleum Exploration Company Limited (Japan)


• Oil and Natural Gas Corporation (India)


• Gail Limited (India)


• Chevron Corporation (U.S.)


• Japan Drilling Co., Ltd. (Japan)


• Schlumberger Limited (U.S.)


• ConocoPhillips (U.S.)


• Korea Gas Corporation (KOGAS) (South Korea)


• ExxonMobil Corporation (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• January 2024- A scientific drilling mission in the Gulf of Mexico returned 44 cores from a methane hydrate reservoir deep beneath the ocean floor. Globally, energy-rich methane hydrates contain about 15% of the world's organic carbon but are poorly understood by the scientific community. The successful mission, led by The University of Texas at Austin, will now allow universities and scientific institutions around the country to study the methane hydrates.


• October 2023- As part of an international partnership, the National Energy Technology Laboratory (NETL) of the U.S. Department of Energy (DOE) announced that it is investigating the gas hydrate resource potential of the Prudhoe Bay Unit on Alaska's North Slope.


• January 2023- China unveiled that it is ready to spud a third gas hydrate well in the South China Sea. More exploration and evaluation activities are needed before commercial development in 2030.


• December 2022- An expedition funded by the National Energy Engineering Laboratory of the U.S. Department of Energy (DOE) and the Japan Organization for Metals and Energy Security (JOGMEC) drilled more than 600 meters (2,000 feet) of permafrost to remove hydrate-bearing sediments from deep below the tundra surface.


• March 2021- Offshore oil rig manufacturer Modec announced its plans to develop a system designed to extract methane hydrate, also known as fire ice, from the ocean floor and turn it into a source of clean-burning hydrogen. Modec will pilot the technology during the next fiscal year starting April. The technology will be used in a novel floating unit that will retrieve the methane hydrate.  The technology is used in a new floating unit that produces methane hydrate.

REPORT COVERAGE

The report provides a detailed value chain analysis of the market and focuses on key aspects such as competitive landscape and gas hydrates market share by type and by origin. Besides this, it offers insights into the market trends and highlights key industry developments and key players. In addition to the factors above, the report encompasses several factors that have contributed to the growth of the market in recent years.

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