American LNG producers will profit from the US$ 5.25 billion expansion of the Panama Canal, as the distance to ship US liquefied natural gas from the Gulf Coast to Asia will decrease by 9000 miles. The expansion will allow larger ships carrying LNG to make use of the canal en-route to Asia. Currently, only 21 of the existing global fleet of 370 LNG tankers can fit through the Panama Canal and none actually use it, Commissioner William P. Doyle of the Federal Maritime Commission noted in a keynote address to the Eno Center for Transportation's Forum on the Panama Canal on 19 September.
The expansion will enable US LNG producers to compete with Australia, Russia, East Africa and the Middle East as a natural gas supplier for Asian markets. With the development set to be complete by the end of 2015 - in time for the first scheduled exports from Sabine Pass on the border between Texas and Louisiana - more than 80% of LNG tankers will be able to make the passage through the Canal. The development of US natural gas resources, together with the expansion of the Canal, will have a “transformative impact on the US energy and transportation landscape”, Doyle noted. A study commissioned in 2011 by the Texas Department of Transportation projected that the Panama Canal expansion will enable Texas to export an additional 15 million t of cargo to lucrative new Asian markets.
Edited from various sources by Katie Woodward
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