Recent developments in the global gas market – LNG and bio-LNG

Gas market forecast

The International Energy Agency (IEA) has published its latest Gas 2025 Report, providing an analysis and forecast of the global gas market, with a particular focus on liquefied natural gas (LNG). The report anticipates that around 300 billion cubic metres of additional LNG export capacity per year could be added by 2030. This expected growth is already shaping investment decisions and prompting supply chain adjustments, as producers work to balance reliability with sustainability.

In parallel, industry conversations increasingly centre on how LNG producers might reduce emissions while maintaining security of supply. Carbon capture and storage is gaining momentum across upstream and liquefaction operations, while bio-LNG is emerging as a complementary pathway, signalling the sector’s dual priorities: safeguarding energy availability while progressing towards net zero.

Biomethane liquefaction in Klaipėda

A step forward for low-emissions gases comes from Lithuania, where the Klaipėda LNG terminal has become the first in the Baltic region to facilitate virtual biomethane liquefaction. This system tracks and transfers the renewable attributes of biomethane through the gas grid, allowing it to be converted into bio-LNG at the terminal. Developed jointly by KN Energies, Equinor and Gasum, this model demonstrates how biomethane producers can access LNG markets without physical liquefaction at the point of injection.

The IEA expects biomethane to account for over half of the projected increase in low-emissions gases by 2030, underlining its potential contribution to the energy mix.

Biomethane and its uses

Biomethane is produced by upgrading biogas generated via anaerobic digestion of organic waste such as agricultural residues, food waste and sewage. Once refined, it is chemically identical to natural gas, making it compatible with existing infrastructure.

It can be used for heat, power generation, fuel for transport (bio-CNG and bio-LNG), and industrial processes requiring high-grade methane. As such, it offers a route to decarbonisation that does not rely on extensive new pipeline development — an advantage that could support more rapid scale-up and adoption.

For developers, the emergence of virtual liquefaction raises practical considerations around project design, planning and commercial delivery. For the wider market, it may influence price stability and system flexibility over time.

Regulation and compliance

Regulatory frameworks will play a central role in determining pace and scalability. In the EU, Regulation 2023/1805, in force since January, introduces stricter renewable fuel requirements for the shipping sector through annual GHG intensity reduction targets. The UK framework — including the Green Gas Support Scheme and associated sustainability criteria — also shapes compliance obligations and certification pathways.

For investors, these regulatory developments affect cross-border arrangements, contracting structures and risk allocation. Understanding them early will be key to strategic planning.

Looking ahead

Gas Infrastructure Europe reports that, as of early 2025, 25 European countries host 1,678 biomethane plants, up from 1,548 the previous year. Around 86% are connected to the gas grid, with total installed capacity at 7 bcm annually, led by France.

The breakthrough at Klaipėda represents more than technical progress — it indicates a market moving towards greater integration of renewable gas. Stakeholders should expect further regulatory refinement and new commercial models to support decarbonisation across transport and industry.

How we can help

Our team advises across the LNG value chain, supporting clients with:

• regulatory compliance under EU and UK frameworks
• contract negotiation and drafting, including PPAs and supply agreements
• strategic planning for market entry and scale-up
• specialist expertise in UK LNG storage

As the sector evolves, we help clients deal with challenges, assess risk and unlock opportunity.