Panama Plans Interoceanic Gas Pipeline Energy Corridor

Panama, under President Jose Raul Mulino, is launching a major infrastructure project to build a gas pipeline alongside the Panama Canal to create an interoceanic energy corridor linking the Atlantic and Pacific markets. This initiative aims to diversify Panama Canal revenues beyond shipping tolls by adding energy transit, attracting global investors including Japanese firms, and boosting regional energy security through a reliable gas supply route. The Panama Canal Authority anticipates significant economic benefits, including substantial construction and permanent jobs, as well as over $1.5 billion in annual operating revenue. The pipeline project is part of a broader strategy to enhance Panama's competitiveness and status as a global trade and energy hub, with plans to begin prequalifying interested parties in 2025 and select a concessionaire by late 2026. Meanwhile, Panama is also pursuing a strategic power interconnection with Colombia, potentially influencing liberalization reforms in Panama's power sector; however, political challenges have slowed progress on these energy reforms. Together, these developments highlight Panama's efforts to strengthen its energy infrastructure and integrate regional energy markets.