League tables A burst of energy

Energy is where it’s at for infrastructure investors – it’s that simple, and there’s really no need for any qualification. Take a look at our top 10 projects table for initial confirmation and you’ll find that all five of the largest infrastructure projects around the world last year were energy-related, topped by the enormous $42.1 billion Ichthys liquefied natural gas (LNG) project in Western Australia.

Then adjust your gaze to the top sectors. To provide context, every year this is a close race between the two dominant sectors of energy and transport. In 2011 for example, energy accounted for 35 percent of total activity and transport 30 percent – an outcome broadly in line with previous years. And then, in 2012, the race suddenly ceased to be close as energy’s $156 billion of deals gave it a 59 percent market share – completely eclipsing transport’s 21 percent. Moreover, add the 12 percent accounted for by renewables and you have a share of more than 70 percent.

While the two largest deals were recorded in Australia, the demand for energy-related infrastructure is growing all over the world. Moreover, because the demand for energy is often far from the source, the need for infrastructure in the areas of exploration, development, transportation and distribution is all the more acute. The shale gas boom in the US is but one example of a trend lending itself to greatly increased energy infrastructure investment.

Assisted by the two mega-deals in Australia, there is also a notable outcome in the top regions table with Asia Pacific’s $92 billion of deals making it a runaway leader. Western Europe, normally at the top of this table, is well behind on $59 billion with the Middle East and Africa in third ($40 billion) and North America fourth ($28 billion).