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Midstream & Downstream Natural Gas

We help clients capture maximum value from the sourcing, wholesale marketing, retailing, transmission, distribution, and storage of natural gas and liquefied natural gas.

The natural gas industry presents complex challenges, from assessing the robustness of unconventional gas strategies in North America to evaluating the impact of liquefied natural gas (LNG) pricing on demand in Asia.

To navigate an unpredictable market, companies need a global perspective on the dynamics of the business, analytical rigor in weighing strategic options, and the flexibility to respond swiftly to shifts in supply, demand, regulatory context, and competitive behavior.

Examples of our work

We serve top oil and gas companies, power generators, pipeline operators, wholesale and distribution utilities, traders, and industrial buyers. We help clients develop insights into opportunities and risks, tailor their strategy to market outlook, evaluate asset and contract portfolios, define their regulatory stance, adopt powerful digital and analytic technologies, build capabilities, manage talent, and achieve operational excellence.

Energy Company Seeking International Gas Opportunities

Working with an energy company seeking international natural gas opportunities to analyze markets, model scenarios, create an integrated business plan, and develop a strategy to enter markets and capture €300 million in value creation

Taking Positions in LNG Marketing and Terminal Ownership

Helping a gas utility to take positions in LNG marketing and terminal ownership to diversify its gas sourcing by 20 percent and improve its negotiating position with suppliers

Developing a Risk-Scoring Method

Supporting a gas distribution utility in developing a risk-scoring method for allocating capital across a portfolio of more than 500 projects, 15 to 20 percent of which were reprioritized in line with their safety risk probability

Featured capabilities

We invest in a program of research and testing to develop our own tools for a variety of industry-specific functions, including:

  • Gas Portfolio @ Risk. This model for scenario generation and analysis helps clients uncover value-creation opportunities in their assets and contracts.
  • Market modeling. Our Global Energy Perspective provides an integrated view of the natural gas, power, oil, and coal markets with scenarios up to 2050; our Global Gas Model and North American Gas Model enable scenario testing for price, demand, and trade.
  • Benchmarking. We have separate tools for Basin Production & Economics, the LNG Cost Curve, and the Global Shale Gas Cost Curve.
  • Cost curves. Our International Natural Gas Distribution Benchmarking Survey includes operating and capital expenses data from more than 40 companies in more than ten European and Latin American countries; our Commercial Performance Survey for Energy Trading provides gas and power benchmarks for trading, risk, and back-office operations.

More from this practice

Energy Insights

Access data-driven energy market analysis, benchmark performance and gain valuable business insight. McKinsey Energy Insights, a McKinsey Company venture, gives clarity to the energy sector.

Related Insights

How COVID-19 and market changes are shaping LNG buyer preferences

– Our recent survey gauges how the pandemic has affected buyer sentiment with expectations of an increased reliance on the spot... and short-term market.

Setting the bar for global LNG cost competitiveness

– By 2035, unmet LNG demand could reach 100 to 140 MTPA. With more than 100 pre-FID projects totaling over 1,100 MTPA in contention... to meet this demand, how can operators improve their competitive position?

Value over volume: Shale development in the era of cash

– Despite rising production, most US shale producers are showing negative free cash flow. To improve capital efficiency, they need... to optimize development strategies for economic value, not volume.

Forced boil-off gas: The future of LNG as a fuel for LNG carriers

– New limitations on sulphur emissions will require ship operators to consider alternative fuels. As a result, the use of forced... boil-off liquefied natural gas is likely to increase.

North American gas outlook to 2030

– Here’s what you need to know about the North American outlook for gas demand, supply, and price to 2030.

The EU gas network resilience through advanced analytics

– How advanced analytics can help you understand the European gas network system response under demand and supply discontinuities.

Global LNG market dynamics: H1 2018

– Our semi-annual overview provides a high-level look at the LNG market during the first half of 2018, comparing current LNG market... dynamics with the same period a year ago.

LNG regas terminals: diversification the way forward

– Regulated LNG regas plants have come under pressure not only from open access regulation and overcapacity, but primarily from... a shift to a role as a separate business entity responsible for its own performance, especially in Europe - prompting plant owners to diversify into less regulated areas.

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