The latest round of rebates for transiting LNG vessels in the Suez Canal is set to boost traffic as the rival waterways compete for traffic ahead of an upsurge in LNG exports as US production rapidly increases.
The Suez Canal’s new discount on tolls, now in effect for six weeks, offers a hefty 65% cut on normal charges for laden or ballast LNG tankers operating between the American Gulf and Singapore.
It comes on top of a series of rebates announced earlier. These include a reduction of 30% on the normal dues for tankers operating between the Middle East Gulf and west of India up to the port of Kochi, and a 40% rebate for vessels sailing from Kochi to Singapore.
Meanwhile LNG traffic is increasing through the Panama Canal. On 1 October, the canal posted a milestone when four LNG ships transited in a single day through the Neopanamax locks, one vessel more than the previous record set on 17 April.
Both waterways are bending over backwards to encourage LNG carrier transits. It is no coincidence that 1 October was also the day the Panama Canal Authority lifted daylight and encounter restrictions through the enlarged locks, effectively giving a second daily slot for LNG transits. Since the new locks were commissioned in June 2016, the authority had restricted the passage of carriers to daylight hours and prohibited them from passing each other in different directions.
“Together, these changes will provide more flexibility and time during the day to transit LNG vessels,” said Panama Canal Authority deputy administrator Manuel Benitez. “[They] will allow LNG shippers to compete for a second booking slot.”