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Panama Canal plans energy corridor, ports & water infrastructure expansion

Posted on July 9, 2025

The Panama Canal Authority (ACP) unveiled a major strategic diversification plan, which includes development of an energy corridor (LPG pipeline), new port terminals on both Atlantic and Pacific sides, a land logistics corridor, and a water security project centered on the Lago Río Indio reservoir, according to ACP’s release.

In a speech marking the inauguration of the new board of the Panama Maritime Chamber, ACP Administrator Ricaurte Vásquez Morales emphasized the need to “increase Canal revenues and future sustainability for the benefit of all Panamanians.”

He noted that the Canal must respond to global maritime commerce demands—as it did with the 2016 expansion—and said “our obligation is to generate more resources for social investment in Panama.”

He added that additional water will support both citizens and Canal operations, fuel (gas) transport will avoid using the interoceanic locks, and more ports would be offered to global users.

The energy corridor envisions an 80 km interoceanic LPG pipeline connecting both canal banks, allowing transfer of liquefied petroleum gas without vessel transit through the locks—a move projected to relieve congestion, cut costs on tolls, tugs and pilots, and keep slots available for container and LNG vessels.

On water security, ACP proposes constructing a US $1.6 billion dam and reservoir on the Río Indio: 90.5 m tall, 840 m long dam with an 8 km tunnel to Gatún Lake, increasing dry‑season capacity for around 15 extra daily transits and supplying potable water to over 50 % of the population for the next 50 years.

ACP’s 10‑year investment plan (2025–2035) totals approximately US $8.5 billion, financed through a mix of public–private partnerships and internal funds. It includes the pipeline, reservoir, multimodal logistics hub with port terminals, highways, railways, and new tugboats ordered from Spain’s Armón shipyard.

The Panama Canal Authority (ACP) is an autonomous legal entity of the Republic of Panama, established in 1997 to operate, administer, preserve, maintain and modernize the Panama Canal.

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