Wednesday, May 05, 2021

US nat-gas surge proves a boon to expanded Panama Canal

Ships cross the Cocoli locks in the expanded Panama Canal, in Panama City, Panama, 26 June 2017. The expanded Panama Canal has set records and surpassed expectations in maritime traffic. Thanks to the boom in natural gas in the USA the transport of liquefied natural gas is a significant part of the performance of the Canal. EFE

Panama City, Jun 26 (EFE).- The burgeoning US natural-gas industry is largely responsible for the high volume of shipments of liquefied natural gas (LNG) through the expanded Panama Canal, the waterway’s manager said Monday.

Nine percent of the more than 1,500 vessels – nearly six per day – that have transited the canal in the one year since the expansion was completed were carrying LNG, administrator Jorge Quijano said.

That number far exceeds the forecast made a decade ago at the start of the project to expand the inter-oceanic channel, when the United States “was not an exporter, but rather an importer of gas,” he said.

Prior to the expansion, the canal could not accommodate the tankers used to transport LNG.

Of the LNG shipments that move via the Panama Canal, 70 percent sail from a single plant on the US East Coast, Quijano said.

Ship Ever Loading of Evergreen company crosses the Cocoli locks in the expanded Panama Canal, in Panama City, Panama, 26 June 2017. The transport through the Canal of Liquefied Natural Gas has been a rate bigger than the overseen by authorities, thanks to the boom in this industry in the United States, said general manager of the Canal Jorge Quijano, one year after the Expansion was presented. EFE

“Three additional plants will be opened (in the US) over the next two years, which means that there is a great possibility that liquefied natural gas (shipments) will grow to double what we are seeing today and possibly even to three times that,” the canal administrator said.

Thanks in part to the expansion, the Panama Canal Authority (known by the Spanish initials ACP) is on track to provide the Panamanian government with more than $1.6 billion in the current fiscal year, which ends Sept. 30, compared with $1.01 billion the previous year, Quijano said during a ceremony at the Cocoli Locks.

A 12.5 percent gain in revenue since October 2016 is attributable exclusively to the new locks, he said.

Container ships continue to represent the lion’s share of traffic through the canal, but volume has grown by less than expected as a result of a decline in global trade, the administrator said.

“We hope that economies continue recovering next year and we can see more container ships passing through the canal,” Quijano said.

Built by the US more than a century ago, the Panama Canal handles roughly 6 percent of the world’s trade.