Market Trends of Denmark Oil And Gas Midstream Industry
Transportation Sector is expected to Witness Growth
- The pipeline is an important means of transportation for natural gas, crude oil, and oil products. The oil and gas supply in different regions is expected to increase the existing transportation capacity, which requires expanding and constructing new pipelines. In Denmark, the pipeline is a substantial mode of transportation for natural gas.
- The country's natural gas consumption remained the same, from 2.3 billion cubic m of oil equivalent (mtoe) in 2021 to 2.3 billion cubic m in 2020. Gas production in Denmark decreased by 4.9%, year on year, from 1.4 billion cubic m of oil equivalent in 2020 to 1.3 billion cubic m in 2021.
- In 2022, due to the Russia - Ukraine war, Russia cut down the natural gas supply to Denmark, leading to a shortage of natural gas in Denmark. Denmark aims to increase its natural gas production to reduce its dependency on Russia and intends to produce more than enough gas to become self-sufficient.
- Moreover, Denmark plans to increase green power production by four times by 2030. The strategy includes expediting the green transition, phasing out natural gas, raising green heat and electricity, and green tax reform.
- Owing to increasing demands for natural gas production, the transportation sector is expected to witness significant growth in the Denmark oil and gas midstream market during the forecast period.
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Increasing Investment in the Oil and Gas Midstream Sector to Drive the Market
- The oil and gas midstream sector saw a rising investment owing to increasing demands for crude oil production and light distillates' increasing demand.
- For instance, oil consumption in Denmark increased by 1.1% in 2021. In 2021, the oil production was 128 thousand barrels per day compared to 2020, which was 127 thousand barrels per day.
- The Baltic Pipe, a 650 km (maximum) natural gas pipeline with a 120 km long offshore natural gas pipeline portion, was inaugurated in Poland in September 2022. The pipeline capacity is expected to be around 10 billion cubic m annually. The purpose of the oil pipeline is to store and transport fuel to airfields and barracks in Denmark.
- The proliferating demand for crude oil for refining and petroleum products is anticipated to boost the midstream infrastructure in the country.
- The Denmark oil and gas midstream industry is expected to grow slightly over the forecast period due to the expected massive increase in the consumption of oil and an increase in investment in the pipeline infrastructure.
