As part of its effort to maximize efficiency, flexibility and reliability of Canal operations, the Panama Canal announced changes to the Transit Reservation System for neopanamax vessels, to take effect from 1st October 2018.
Among the main issues addressed were the need to increase the number of LNG vessels that may book per day, and adjustment of the booking periods based on the needs of the LNG industry, which include the spot and long term contracts market (Annual Delivery Program) scheduling.
Currently, clients can book transits during three periods determined by the days prior to the required transit date. As such, the announced modifications will introduce a new reservation space within the first period, called “reservation period 1.a”, which will be accompanied by modifications corresponding to the duration and redistribution of spaces within each reservation phase.
The modifications to the reservation system will address the current practice by some LNG customers of acquiring booking slots during the first period competition, to the point where these slots are nearly sold out up to 365 days in advance, while in reality these slots are only used on average 60% of the time.
These changes will also include a transition period for those LNG vessels that have obtained quotas during the current reserve period 1, which will allow them to be released without cancellation costs.
These modifications will allow the Panama Canal to better handle the present and expected demand for LNG vessel transit slots by providing the certainty and flexibility required by the LNG market segment. These changes should also improve the efficiency of the transit reservation system, which will benefit all users of the Neopanamax locks.
Modifications to the Neopanamax booking periods The total number of spaces available for neopanamax vessels and the priority for certain segments will not change. We saw the opportunity to increase the efficiency and capacity of the Panama Canal for customers in all segments by better addressing the needs raised by the LNG industry. (To do so), we adapted the Transit Reservation System and aligned ourselves with the immediate delivery market and the long-term contracts (Annual Delivery Program) in the LNG segment and its programming, with the lifting of certain restrictions for LNG ships, …said Silvia de Marucci, executive manager of the Division of Economic Analysis and Research. of the Panama Canal Market. Although it is the fastest growing segment, LNG ships use only 60% of their reservations. The announced changes will allow the Panama Canal to optimize and better accommodate LNG transits in the future, at the same time, it will be maximized for all segments. The new modifications to the Transit Reservation System are part of a series of efforts to provide greater flexibility and reliability in accordance with the growing needs of the market. This includes the decision in June to lift the imposed restrictions on natural light and comply with restrictions on LNG transits as of October 1, 2018, as well as the additional reservation quota for neopanamax that was implemented in May, which gives a total of eight places per day.
