The liquefied-natural-gas industry is taking full advantage of the expanded Panama Canal. After a record number of transits in 2017, LNG traffic is expected to spike by 50 percent in the current fiscal year, according to Panama Canal Authority officials.
Most of the traffic is coming from the United States, where natural gas production is on the rise.
In fiscal 2017, 163 LNG ships were registered for transit; 244 are expected in 2018. A large chunk of the growth is coming from ships headed from Louisiana to Asia.
The growth of LNG is expected to send ripples through the entire Panama economy, with the addition of more support facilities and companies growing their Panama operations.
There had been some questions in the industry if the canal would be able to handle the LNG traffic. LNG slots through the Canal have been more than two months ahead of time, according to industry reports.
But the Canal has been adjusting its rules and procedures as the Canal Authority “gained experience in understanding the nature of the LNG trade,” Silvia de Marucci, executive manager of the Economic Analysis and Market Research Division for the Canal Authority, wrote in a recent column.
LNG transits had been limited to one ship a day, but the Canal is now allowing two on certain days and allowing night-time transits to help accommodate demand, according to news reports. The Authority has been able to transit two LNG carriers in one day 13 times, “and plan to continue to do so whenever the vessel mix allows it,” according to Marucci.
“Thanks to the data and experience we have gained thus far, we will soon be able to lift some of the transit restrictions on these vessels,” Marucci wrote. “This will keep us ahead of demand and allow us to accommodate demand surges as needed.”