Panama Investment Forum

Panama has been a regional leader in terms of growth in Latin America, a key question at the Panama investment forum is to project Panama’s before and after: From Logistic Hub to Latin America’s business

New York

Event Panama Investment Forum location in New York
23 Feb 2016
ProgrammeProgramme

Panama Investment Forum

The forum offers direct and personal networking opportunities through one-to-one meetings, side sessions and more informal and relaxed gatherings such lunches and cocktail

New York

Event Panama Investment Forum location in New York
23 Feb 2016
ProgrammeProgramme

Panama Investment Forum

Attendees will gain a real and valuable insight into business and investment opportunities in Panama, and a chance to meet personally with the key people who know how to unlock

New York

Event Panama Investment Forum location in New York
23 Feb 2016
ProgrammeProgramme

Panama Investment Forum

The Panama Investment Forum will bring top executives, institutional and alternative investors, bankers and policy makers with representatives from Panama’s public and private sector to discuss Panama’s economic diversification through its

New York

Event Panama Investment Forum location in New York
23 Feb 2016
ProgrammeProgramme
Opinion
2015-04-30    Panama< Back
Can Panama become a regional energy hub?

The $5.25 billion Panama Canal expansion project will be completed in December, further strengthening the Central American nation as a transhipment hub.

But the expanded waterway is also central to Panama’s ambitions to become a regional energy hub. When opened, it will handle an estimated 12 million metric tons of liquefied natural gas annually, the majority of which will originate from the U.S. – set to become the third largest exporter of LNG by 2020 – onto markets in Asia.

Already a major transit centre for petroleum, Panama has several free zones with large capacity to store petroleum products, and is a strategic location for the development of refineries that will serve regional export markets.

In 2007, the government unveiled a $40 billion plan to develop refining capacity. Since then a number of investors have expressed interest in developing a refinery at the Pacific end of an existing pipeline that stretches across the isthmus to the Caribbean. However the fact that hitherto the government has been unable to secure a deal to build Central America’s first large oil refinery (a memorandum of understanding with a Qatar-led venture expired in 2008) really puts into question the whole plan to turn Panama into a petrochemical hub.

The second pillar of Panama’s energy plan is the development of the power sector. With abundant hydro, thermal and other renewable energy resources (Panama was recently ranked third in a study as one of the most attractive countries in to which invest in clean energy), the country has huge potential in electricity exportation.

Total installed capacity is generated almost entirely from thermal and hydrocarbon resources. But the government hopes to diversify the energy mix and increase capacity by developing solar, wind and LNG power plants. Panama was recently ranked third in a study as one of the most attractive countries in to which invest in clean energy. As a result of the country’s capacity to transit and store LNG, a new law was established in 2012 to encourage the construction and operation of power plants based on natural gas. Since then several plans for the construction of LNG plants have been approved.

Due to its strategic location, Panama is key to plans to connect the electricity grids of North and South America. Central to this is the Colombia-Panama electricity interconnection project, which will see the construction of a 600-kilometer were transmission line between the two neighboring countries that will produce 300-400 megawatts of electricity. After some years of dormancy, the project re-launched last year and is expected to be completed by 2020.

Panama is also part of the landmark SIEPAC system, a project has been constructed for the transmission lines to connect 35 million consumers in Panama, Costa Rica, Honduras, Nicaragua, El Salvador, and Guatemala, at an estimated cost of USD 300 million.

Panama’s energy sector has grown 5% year on year, and energy projects under construction will add energy capacity by 16.5% by end of 2016. Its potential in term of both oil and gas transit and storage through the expanded canal, and generation and exportation of electricity is enormous.

However there are a number of challenges in the electricity sector, particularly in relation to meeting the rapidly rising domestic demand, installation of adequate transmission and new high voltage lines, and lack of long term energy policy to attract much-needed private investment. If Panama can overcome these challenges, its dream to become a regional energy hub will no doubt be realised.

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