{"id":4924,"date":"2026-10-01T09:32:00","date_gmt":"2026-10-01T14:32:00","guid":{"rendered":"https:\/\/panamcham.rewind10.com\/lng-in-panama-infrastructure-competitiveness-and-regional-expansion\/"},"modified":"2026-11-05T06:59:16","modified_gmt":"2026-11-05T11:59:16","slug":"lng-in-panama-infrastructure-competitiveness-and-regional-expansion","status":"publish","type":"post","link":"https:\/\/panamcham.rewind10.com\/en\/lng-in-panama-infrastructure-competitiveness-and-regional-expansion\/","title":{"rendered":"LNG in Panama: infrastructure, competitiveness and regional expansion"},"content":{"rendered":"\n

Energy security, long-term contracting and new opportunities for LNG development.<\/em><\/p>\n\n\n\n

Author:<\/strong> Ricardo D\u00edaz – <\/strong>Vice Chair of the Energy Committee \/ LNG Business Development and Commercial Lead at AES Panam\u00e1.<\/p>\n\n\n\n

Over the past decade, Liquefied Natural Gas (LNG) went from being an emerging alternative to becoming one of the pillars of the global energy transition. In Panama, its impact has reached far beyond power generation. LNG has strengthened the country’s energy security, diversified its fuel mix and made it possible to develop infrastructure with the potential to drive new opportunities in industry, transportation, the maritime sector and regional markets.<\/p>\n\n\n\n

The start of operations at Costa Norte LNG Terminal, in Col\u00f3n, marked a turning point for Panama’s energy sector. With a storage capacity of 180,000 m\u00b3 and the ability to serve vessels from 3,000 m\u00b3 up to 170,000 m\u00b3, the terminal has established itself as one of the most important energy infrastructures in Central America and the Caribbean. It supplies the Gas Natural Atl\u00e1ntico (381 MW) and Generadora Gat\u00fan (670 MW) plants, which together contribute more than 1,000 MW of installed capacity.<\/p>\n\n\n\n

Infrastructure, however, is only part of the equation. Just as important as building a terminal is securing LNG supply under conditions that provide stability and predictability over time.<\/p>\n\n\n\n

In Panama’s case, one of the most significant decisions has been to structure long-term supply contracts indexed to Henry Hub, the main natural gas price benchmark in the United States. Although the final price of LNG includes other components of the supply chain, starting from a stable benchmark and having volumes secured in advance reduces exposure to international spot markets and makes investment planning easier.<\/p>\n\n\n\n

The difference is clear when comparing Henry Hub (HH) with TTF. While HH is the main natural gas benchmark in the United States, TTF has become the most widely used benchmark for the European market and one of the most relevant indicators for pricing spot LNG cargoes within the Atlantic Basin. HH is quoted in dollars per MMBtu, that is, dollars per million British thermal units. TTF is originally traded in euros per megawatt-hour (\u20ac\/MWh). To compare them on the same basis, this article presents both indicators converted to US$\/MMBtu, a unit widely used in international LNG trade.<\/p>\n\n\n\n

Between 2020 and August 2026, HH reached a high of US$9.68\/MMBtu, while TTF climbed above US$99\/MMBtu during the European energy crisis caused by the war in Ukraine and the reduction of Russian gas supplies to Europe. At the close of August 2026, HH stood at around US$2.94\/MMBtu, while TTF remained close to US$23.79\/MMBtu. More than a price gap, these figures reflect two markets with very different characteristics and risk levels.<\/p>\n\n\n\n

The main difference lies in the supply structure. The United States has one of the largest natural gas production bases in the world, backed by an extensive pipeline network, storage capacity and transportation infrastructure. Europe, by contrast, depends to a greater extent on gas and LNG imports. As a result, geopolitical conflicts, supply disruptions, winter and international competition for cargoes tend to be reflected in European prices.<\/p>\n\n\n\n

This advantage opens up opportunities that go well beyond the power sector. LNG can replace liquid fuels in industries such as breweries, food plants, manufacturing and other processes that require continuous thermal energy. It is also an alternative for city buses, heavy-duty trucks and logistics operations seeking to cut emissions and improve their operating efficiency.<\/p>\n\n\n\n

The maritime sector is one of the most attractive opportunities for LNG development in Panama. The sustained growth of the global LNG-powered fleet, combined with the strategic position of the Panama Canal, creates the conditions to develop an LNG Bunkering market capable of supplying vessels that today have to refuel at other ports in the region. The main infrastructure already exists. In addition, some of the world’s leading container and car carrier shipping lines have expressed real interest in sourcing LNG in Panama, particularly during their loading and unloading operations through Simultaneous Operations (SimOps) schemes or, in certain cases, at dedicated anchorages within the waters protected by the Canal’s breakwater. The commercial interest is there; in the current global gas market environment, however, the greatest challenge remains securing a competitive molecule delivered in Panama. Without it, it is difficult to structure long-term supply contracts, preferably indexed to Henry Hub, that provide the visibility needed to support investments such as an LNG barge and other infrastructure associated with developing the market.<\/p>\n\n\n\n

Beyond the local market, Panama also has the potential to become a regional LNG supply platform. Colombia is a clear example. As its domestic gas production has declined, the country has had to increase imports to supplement its internal supply.<\/p>\n\n\n\n

An analysis published at the end of August 2026 by Sergio Cabrales, PhD and Associate Professor at Universidad de los Andes, showed that the price of imported gas for new contracts for September, October and November 2026 reached US$24.97\/MMBtu, a 79% increase over the US$13.96\/MMBtu recorded in February of the same year. By contrast, domestically produced gas remained at around US$13.5\/MMBtu. This difference reflects the challenge faced by countries whose gas demand grows faster than their local production: greater exposure to international market volatility. Cases like this one reinforce the importance of having competitive supply sources and long-term contracts that reduce uncertainty, improve planning and strengthen energy security.<\/p>\n\n\n\n

After nearly a decade operating LNG at commercial scale, Panama no longer has to prove that it can develop and operate this infrastructure safely and reliably. The infrastructure is there, so is the operating know-how, and its geographic location remains a natural advantage that is hard to replicate in the region. What began as an investment aimed at strengthening national power generation can become a platform to drive new industrial markets, develop LNG Bunkering and support supply to neighboring markets that will face growing natural gas demand in the coming years.<\/p>\n\n\n\n

At a time when energy security and competitiveness are becoming increasingly important, Panama has advantages that few countries in the region possess: world-class operating infrastructure, access to LNG from the United States, experience operating the supply chain and a privileged location along the world’s main shipping routes. The next step is not necessarily to build more assets, but to turn those advantages into long-term contracts that make it possible to develop new markets, attract investment and establish the country as a regional LNG hub for Latin America and the Caribbean.<\/p>\n\n\n\n

Appendices<\/h3>\n\n\n\n

Appendix 1. Henry Hub versus TTF, January 2020 to August 2026<\/strong><\/p>\n\n\n\n

\"Appendix<\/figure>\n\n\n\n

Table 1. Annual averages<\/p>\n\n\n\n

\"Table<\/figure>\n\n\n\n

Note: 2026 includes data through August 31. Values in USD\/MMBtu.<\/em><\/p>\n\n\n\n

Appendix 2. Colombia: monthly average price of new gas contracts<\/strong><\/p>\n\n\n\n

\"Appendix<\/figure>\n\n\n\n

Chart courtesy of Sergio Cabrales. \u201cGas importado alcanza US$24.97\/MBTU, un aumento del 79% desde febrero\u201d, August 25, 2026. Source indicated in the chart: Sistema Electr\u00f3nico de Gas (SEGAS).<\/em><\/p>\n\n\n\n

Full references<\/h3>\n\n\n
  1. Dutch TTF Natural Gas Futures and ICE Title Transfer Facility (TTF)<\/a>

    Intercontinental Exchange (ICE) \u00b7 ice.com<\/p><\/div>Open<\/span><\/svg><\/a><\/li>

  2. Gas Market Lessons from the 2022-2023 Energy Crisis: Anatomy of a natural gas crisis<\/a>

    International Energy Agency (IEA) \u00b7 iea.org<\/p><\/div>Open<\/span><\/svg><\/a><\/li>

  3. The impact of the war in Ukraine on euro area energy markets<\/a>

    European Central Bank (ECB) \u00b7 2022 \u00b7 ecb.europa.eu<\/p><\/div>Open<\/span><\/svg><\/a><\/li>

  4. Colombia supera en un 3,15% el escenario de reservas probadas<\/a>

    Agencia Nacional de Hidrocarburos de Colombia (ANH) \u00b7 2026 \u00b7 anh.gov.co<\/p><\/div>Open<\/span><\/svg><\/a><\/li>

  5. Gas importado alcanza US$24.97\/MBTU, un aumento del 79% desde febrero<\/a>

    Sergio Cabrales \u00b7 LinkedIn \u00b7 2026 \u00b7 linkedin.com<\/p><\/div>Open<\/span><\/svg><\/a><\/li>

  6. Henry Hub vs. Dutch TTF historical series (January 2020 – August 2026)<\/span>

    Provided by the author; basis for the chart and the table in Appendix 1<\/p><\/div><\/li><\/ol><\/div>\n\n","protected":false},"excerpt":{"rendered":"

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