The Panama Canal is considering the construction of a pipeline to transport liquefied petroleum gas (LPG) across the strategic waterway, potentially bringing gas from the U.S. to Japan. Canal administrator Ricaurte Vasquez confirmed the plans to Reuters.
“We are exploring the possibility of building infrastructure with the capacity to move up to one million barrels per day (bpd), though the market is much larger,” Vasquez explained.
While the Panama Canal authorities prioritize this project, Vasquez acknowledged its complexity. Initial studies suggest that LPG traffic through the canal could reach up to 2 million bpd in the next decade.
The Panama Canal administration is expected to make a decision on whether to move forward with the plan within the next year, according to Vasquez.
This proposal comes at a time of rising tensions between the U.S. and Panama. President Donald Trump recently suggested that the U.S. should reclaim control of the canal, a structure the country helped build.
In early March, a consortium led by BlackRock purchased two ports on either side of the Panama Canal, just weeks after Trump made his comments. The $22.8 billion deal also involved several other global ports. BlackRock paid $19 billion for the ports of Balboa and Cristobal, previously owned by CK Hutchinson, a company controlled by Hong Kong billionaire Li Ka-Shing. CK Hutchinson also agreed to sell its stakes in 43 other ports across 23 countries.
Trump supported the deal, stating in a speech last week: “My administration will be reclaiming the Panama Canal, and we’ve already started doing it.”
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