After the $5 billion-plus expansion of the Panama Canal is dedicated this Sunday, June 26, the first “New Panamax” vessel scheduled to pass through the canal’s new, longer, wider locks will be the Lycaste Peace, a Very Large Gas Carrier (VLGC) that is transporting propane from Enterprise Products Partners’ Houston Ship Channel export terminal to Tokyo Bay in Japan. What remains to be seen, though, is how many other supersized vessels carrying propane, liquefied natural gas (LNG) or other hydrocarbons will follow, and how soon. Today, we mark the formal opening of the newly enlarged Atlantic-Pacific short-cut with a look both at the game-changing potential of the expanded canal and the realities of today’s energy and shipping markets.
The international energy trade has been shifting toward larger and larger sea-going vessels, seeking to maximize economies of scale and minimize shipping costs. That shift has been stymied somewhat, though, by the Panama Canal’s inability—until now—to handle the vast majority of the world’s LNG and liquefied petroleum gas (LPG) carriers. As we said in our recent Run Through the Jungle blog series and Here She Comes, Full Blast blog, until new, larger locks were built and other improvements were made along the canal, the manmade waterway was limited to vessels no larger than 965 feet long and 106 feet wide; and their drafts (or depth below water level) were capped at just under 40 feet. (Ships up to this size and draft are known as “Panamax” vessels.) When the new canal locks open for business this weekend, the “New Panamax” dimensional limits of ships using the canal increases to 1,200 feet in length, 160 feet in width, and 50 feet of draft. That’s a game-changer for both LNG and LPG. Until now, less than 10% of the world’s 400-ship fleet of LNG carriers can use the canal, but starting on Sunday more than 90% will be able to. (In fact, the only LNG carriers that will not be able to use the canal because of their width are the Q-Flex (164 feet wide) and Q-Max (180 feet wide), vessels whose use was pioneered by Qatar Gas to move staggering volumes of LNG.) The expanded canal also significantly expands the number of ships that can move propane, butanes or LPG (which is mostly propane with some butanes) through the canal. The VLGC (which can carry between 375 MBbl and 550 MBbl, depending on the model) is the LPG-mover of choice, especially for serving mega-markets like Japan (where, as we said, the first VLGC to ply the expanded canal is headed). Only one-fifth of the 200 or so VLGCs now afloat could fit through the old Panama Canal, but now every VLGC on the planet (including the first through-the-locks Lycaste Peace—photo below—which is leased to Japanese LPG trader Astomos Energy) can fit through the expanded waterway.
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About the song
“Ship of Fools” was written by Jerry Garcia and Robert Hunter, and appears as the fourth song on Side 2 of the Grateful Dead's seventh studio album, From the Mars Hotel. The song was first premiered live at Winterland in San Francisco in February 1974. It contains one of Jerry Garcia's personal favorite guitar solos in the outro of the song. Personnel on the record were: Jerry Garcia (lead guitar, lead vocals), Bob Weir (rhythm guitar, vocals), Phil Lesh (bass, vocals), Bill Kreutzmann (drums), Keith Godchaux (keyboards, vocals), and Donna Godchaux (vocals).
From the Mars Hotel was recorded during April 1974 at CBS Studios in San Francisco and produced by the Grateful Dead. Released in June 1974, the album went to #16 on the Billboard 200 Albums chart. The real Mars Hotel, as depicted on the LP's cover by Kelley/Mouse, was a flophouse that Jack Kerouac had briefly lived in. Located at 192 Fourth Street in San Francisco, it has since been demolished.
The Grateful Dead were an American rock band formed in Palo Alto, California, in 1965 by Jerry Garcia, Bob Weir, Phil Lesh, Ron "Pigpen" McKernan, and Bill Kreutzmann. Thirteen members passed through the band since its formation. They have released 13 studio albums, 10 live albums, 10 compilation albums, 27 singles, 74 retrospective live albums, 36 Dick's Picks albums, and 41 Dave's Picks albums. They have sold more than 35 million records worldwide. The band have a Grammy Lifetime Achievement Award and was inducted into the Rock and Roll Hall of Fame in 1994. Original member Ron “Pigpen” McKernan died in March 1973, and Jerry Garcia in August 1995. After Garcia's death, the remaining members of the band decided to disband. Since that time there have been reunions and various side projects by surviving band members.
