Panama Canal Activity Demonstrates American Energy Dominance

Tom Shepstone
Natural Gas NOW


The Panama Canal is changing its rules to adapt to LNG, recognizing that American energy dominance is the foundation and future of the Canal itself.

A recent article in The Panama Perspective demonstrates how the glorious shale revolution continues to change everything. It reports the Panama Canal Authority (ACP) is rapidly gaining LNG ship traffic and the U.S. is dominating. Reading the facts, it is impossible not to appreciate how far the shale revolution has come and how the U.S. and much of the rest of the world is benefitting.

Here are the key facts from the article:

  • “The Canal expansion completed two years ago included a new set of locks on the Atlantic and Pacific sides of the waterway, creating a third lane of traffic and doubling the cargo capacity. The expanded locks are 70 feet wider and 18 feet deeper.”
  • New larger Panama Canal “locks may be able to handle as many as 3 LNG shipments in one day.”
  • The Panama Canal is also lifting restrictions that now keep LNG vessels from being able to navigate Gatun Lake at the same time, which means “two different LNG vessels should be able to transit the Canal the same day in two different directions.”
  • “Since the expansion was completed, the Canal regularly has transited two LNG vessels in the same direction on the same day. In April, the Canal demonstrated it could transit up to three vessels on the same day in the same direction, with the tankers all destined for Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana.”
  • “In late April, the Canal also transited the first-ever shipment of LNG from the Dominion Cove Point terminal in Maryland to Japan.” That was, undoubtedly, Appalachian shale gas produced somewhere in rural Pennsylvania or Ohio, perhaps Susquehanna County.
  • “LNG transits are expected to continue to escalate as more export terminals are opened along the U.S. Gulf Coast and as more LNG supply moves to Central American destinations.”
  • “The expanded waterway through the end of June had welcomed a total of 372 LNG transits. All of the LNG vessels that arrived with reservations were transited on time, except for one vessel that arrived late.”
  • “The Canal’s decision to lift restrictions for LNG traffic has come with experience in transiting the very large gas carriers, or VLGCs. In addition to LNG exports, the expanded Canal has opened up the market for more liquefied petroleum gas exports transited via VLGCs.”
  • LNG traffic via the Canal is expected to grow by 50% at the end of this fiscal year from 2017, increasing to about 244 transits from 163.”
  • “The Canal expansion completed two years ago was the largest enhancement project in the waterway’s 103-year history.”
  • “LNG tankers today pay about $500,000-525,000 to use the Canal. The ACP also is seeing bigger container ships willing to pay more than $1 million.”

This is the sort of story that doesn’t make into the mainstream press. Moreover, no fractivist is going to notice, either. It’s essentially insider information that tells us the glorious shale revolution is ever conquering more territory. It is an irresistible force.

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