The Panama Canal Authority (ACP) signed a cooperation agreement with the Port of Lake Charles in Louisiana earlier this week, which aims to attract new customers from the liquefied natural gas (LNG) industry to soon to be the expanded Canal. Currently, LNG vessels cannot transit through the waterway due to their beam dimensions, which are too wide to fit the existing locks. The agreement will
promote cooperation in marketing activities, information exchange, market research, training and technology, among other initiatives that will benefit both the Canal and the Port of Lake Charles.
The Port of Lake Charles is a deep water port with entry into the Gulf of Mexico, and several companies are expected to either start construction of new plants or expand their existing LNG liquefaction capacity in the region over the coming years, with the aim of exporting their product mainly to Asia through the Panama Canal. While in Louisiana, the parties responsible for signing the agreement, Jorge Quijano, Panama Canal Administrator/CEO and the Executive Director of the Port of Lake Charles, William J. Rase, were joined in a series of meetings by companies such as Southern California Telegraph & Energy LNG; Magnolia LNG; Venture Global LNG; Lake Charles LNG Company; Cameron LNG; Waller Point Marine and BG Group.
“My interactions with potential users of the expanded Canal while in Louisiana have been extremely relevant to understand their expectations, as well as promoting key business strategies and identifying ways to improve efficiency when the Canal Expansion Program is completed,” said Quijano. While touring Louisiana, Administrator Quijano participated in a panel discussion with investors who are scheduled to build new LNG liquefaction plants with the Canal Expansion in mind. Earlier this week ACP proposed a new toll structure, including tolls for LNG vessels. The proposed unit of measurement for LNG vessels is the cubic meter. The new toll structure will also provide an incentive for the new LNG segment, where customers that use the same vessel for a roundtrip voyage through the Canal will have the option of receiving a special ballast fee, if the transit in ballast is made within sixty days after the laden transit was completed.
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