Panama Canal Working with Cheniere to Host More LNG Transits
- Business & Finance
The Panama Canal Authority is working towards increasing the number of LNG vessels that can transit the Neopanamax locks in a day.
The canal is bolstering its capacity amid the anticipated growth of natural gas exports from the United States, which is likely to increase LNG transits by 50 percent by September, according to Cheniere Energy.
Representatives of the U.S. LNG exporter and the Panama Canal Authority, led by Administrator Jorge L. Quijano, met this week to discuss the waterway’s growing LNG vessel segment and opportunities for future growth.
Cheniere has become the largest LNG user of the canal with 62 transits made in 2017.
“The Panama Canal and the LNG industry are, together, going through a learning curve. Cheniere is confident in the Panama Canal’s capabilities to adapt in addressing the needs of the growing LNG sector. The success of the Panama Canal is essential to the satisfaction of Cheniere’s customers and to the LNG industry as a whole,” Eric Bensaude, Managing Director, Commercial Operations and Asset Optimization for Cheniere, said.
When the expanded canal was inaugurated in June 2016, it opened the waterway up to 90 percent of the global LNG fleet and allowed LNG producers in the United States to ship natural gas to Asia for the first time.
Since then, the canal’s Neopanamax locks have transited more than 280 LNG vessels, and industry experts expect traffic to continue to rise steadily, according to the canal’s authority.
“The meetings with Cheniere allowed us to hear about customers’ experience transiting the Neopanamax locks first-hand, and to collaborate on ways we can continue meeting this growing demand from the LNG industry,” Administrator Quijano said.
In line with current levels of traffic, the Panama Canal offers one reservation slot per day for LNG vessels.
However, two fully loaded vessels have transited the canal in a day when necessary and, according to Panama Canal’s Authority, two-LNG-transit days have become ever more frequent amid traffic scheduling optimization.
“The Panama Canal is also offering more flexibility for LNG bookings so exporters can opt for the Canal route even if that was not the original plan. As expectations for growing LNG shipments materialize, the Panama Canal is already working towards significantly increasing the number of LNG vessels that can transit the Neopanamax locks in a day,” the canal authority said.