Panama is set to play an increasing role in the distribution of liquefied natural gas (LNG) to the region, with the creation of a new facility that will make a distribution center for the key energy source.
The new AES Colon plant is the first of the kind in the region, with the ability to store, transfer and distribute LNG. Panama has the potential to become an export center for (LNG), distributing to Central America and the rest of the region, according to coverage in La Prensa.
Panama already plays a key role in the flow of natural gas around the world, thanks to the traffic through the Panama Canal. The rise of the natural gas industry, including an increase in production from the United States, was a large driver behind the expansion of the Canal and a strong indicator of Panama’s diverse economy.
The news is a reminder that Panama’s real estate market is strong because it is built on a strong economic foundation. The growth of the LNG industry is simply one major example, including the Canal and the region’s largest copper mine, which provide steady growth for years.
The AES Colon facility includes 180,000 cubic meters of storage of which 75 percent is intended for LNG distribution to the region, La Prensa reports. The remaining 25 percent goes to an LNG power generation plant, which is part of the project.
Since the AES Colón Terminal [in October 2019], 24 liquefied natural gas ships from the United States have been received, “consolidating the country as a key supply hub and center in Central America,” La Prensa reports. The company has an agreement for the supply and distribution of LNG with Tropigas Natural, “with which the table is set to provide cleaner fuel to companies and industries in Panama and the region.”
The real significance of the facility is in the potential for growth and the development of another industry in Panama. The secondary market “is just developing, with a client already operating, which is Island Power SA (IPSA) for off-grid electricity generation located in Darien, and Tropigas Natural as a distributor,” the paper reports. “With these clients already in operation, a demand for 15 tanks per week is estimated.”
The general manager of the company told the paper, “The use of natural gas in Central America and, particularly, in Panama will have an exponential increase as a result of the economic and environmental advantages that this fuel has compared to other traditional hydrocarbons, which are generally more expensive and polluting.”