Japanese LNG Suppliers Looking to Circumvent Panama Canal

Japanese LNG lifters with offtake agreements from USGC terminals are looking for alternative routes to circumvent the congested Panama Canal, according to Platts.

• Some of the routes being considered are the use of LNG cargo swaps, or transiting via the Suez Canal or the Cape of Good Hope.
• However, the USGC-Japan via the Suez Canal takes 40 days, compared to 20 days via the Panama Canal.
• Slot availability for LNG carriers is getting tight, with available slots falling from 7 to 6 in December and then to 5 in January. 279 LNG carriers have transited the Panama Canal so far in 2023, compared to 300 over the same period in 2022.
• The ongoing drought at the Panama Canal may also affect Japanese loadings beyond the winter. Around 8% of Japan’s LNG imports in 2023 to date are from the US.