LNG liquefaction equipment spend to double by 2035 as mid-scale plants reshape the build-out
Mid-scale LNG projects are pulling investment away from giant export trains, with equipment spending projected to hit $55.9 billion by 2035.
LNG liquefaction equipment spending is projected to double over the next decade, with the market estimated at $25.4 billion in 2025 and forecast to reach $55.9 billion by 2035, a compound annual growth rate of 8.2%, according to an analysis published by Future Market Insights on Friday (2026-05-29).2
That growth path signals where the next wave of LNG supply is coming from. The same report points to mid-scale plants as the preferred model, citing lower capital investment requirements, faster project execution timelines and flexible production capacity as the main draws for developers.2
The pace is uneven across regions. China tops the growth list at 11.1%, followed by India at 10.3% and Germany at 9.4%, according to the report. The refrigerant compressor system segment is projected to account for 37.2% of total equipment revenue in 2025, establishing it as the dominant technology category.2
The mid-scale shift reflects a broader repricing of LNG project risk, where developers increasingly favour modular, quicker-to-market designs over the multi-year construction schedules of traditional mega-trains. Faster execution timelines reduce capital at risk, and flexible capacity lets operators match supply to regional demand rather than committing to a single large offtake market.2
But the forecast carries obvious tensions. A doubling in equipment spending over ten years implies a substantial order book, yet the report does not specify how much of that demand is already contracted versus speculative. LNG project history is littered with capacity that was announced, financed and then delayed or cancelled when the price environment turned.2
The current price environment is supportive, at least for Asian buyers. JKM spot LNG traded at $22.08/MMBtu on Thursday (2026-08-20), while ICE Brent crude front-month stood at $94.30/bbl, up 0.42% in the same session. Those levels keep LNG competitive against oil-linked pricing in much of Asia, which underpins the demand case for new liquefaction capacity.2,3
At the same time, the equipment market's expansion is happening alongside broader energy infrastructure spending. MarketsandMarkets projected in a July (2026-07-19) release that the global generator market will grow from $26.79 billion in 2026 to $35.38 billion by 2031, a 5.7% CAGR. That is a slower growth rate than LNG equipment, but it points in the same direction: capital is flowing into energy hardware.3,4
The two forecasts overlap in a way that matters for suppliers. Generator demand is driven by grid resilience and backup power needs, while LNG liquefaction equipment demand tracks export project development. Both are competing for the same manufacturing capacity, steel inputs and skilled labour. If the liquefaction build-out accelerates as projected, equipment lead times could stretch and pricing power could shift to fabricators.3,2
The merchant hydrogen market tells a similar story of infrastructure capex, though from a smaller base. TechSci Research estimated the global merchant hydrogen market at $27.51 billion in 2024, projected to reach $44.37 billion by 2030, a CAGR of 8.13%. Oil refining, chemicals, metallurgy and fertilizers account for over 90 million metric tons of annual hydrogen consumption, with over 70% derived from fossil fuels.1
That hydrogen demand is largely industrial and existing, not new and clean. The same cannot be said for LNG, where the equipment forecast implies a wave of new export capacity requiring sustained gas demand growth. European buyers facing ICE Endex TTF front-month prices at €63.41/MWh on Thursday (2026-08-20) remain sensitive to supply additions that could ease the continent's reliance on spot cargoes.1,2
The key risk to the 8.2% CAGR is project execution. Mid-scale plants reduce but do not eliminate the classic LNG perils of cost overruns, permitting delays and offtake renegotiations. The report's growth forecast is a top-down projection, not a project-by-project pipeline, and the gap between those two views is where the market can disappoint.2
Equipment order flow is the signal to track over the next twelve months. If mid-scale final investment decisions accelerate through 2027, the $55.9 billion figure will start to look conservative. If they stall, the more likely result is a longer timeline, not a smaller market.2