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Last Updated: March 2016


Map of Panama
Map of Panama
  • Panama is not a producer of crude oil, natural gas, or coal. However, the country serves as an energy transit point through its controls of the Panama Canal and Trans-Panama Pipeline.
  • The United States is the leading source of Panama's energy imports, shipping over 64 million barrels of refined petroleum products in 2014.


  • In 2014, hydroelectric power accounted for 54% of Panama's gross electricity generation (9.3 billion kilowatt-hours), while oil-fired generation accounted for 37% and coal represented 7%. Renewables including biomass-fueled generation, wind, and solar made up the remaining portion of less than 1%.
  • To meet domestic demand for electricity, Panama has collaborated with its neighbors to construct shared transmission lines. Panama is one of six Central American countries to join SIEPAC or theSistema de Interconexión Eléctrica de los Países de América Central, a major transmission project completed in late 2014. The 1,118-mile transmission line, with a capacity of 300 megawatts (MW), connects the electricity grids of Panama, Costa Rica, Honduras, El Salvador, Guatemala, and Nicaragua and is managed by an independent system operator. SIEPAC is intended to provide reliable and safe power transmission capacity, enhance the use of renewable power, and increase electricity trade throughout Central America. Another power line, stretching roughly 381 miles with at least 300 MW of capacity, is under development between Panama and Colombia. The project is slated to commence operations in 2018.

Oil and natural gas transit

  • The Panama Canal expansion program is 97% complete and expected to be finished by June 2016.
  • The U.S. trade lane most affected by the expansion is the East Coast U.S.-Asia trade lane because it represents the highest percentage of total cargo tonnage passing through the Canal.
  • The expansion program was designed to increase the Canal's capacity and allow for the transit of larger vessels. However, vessels similar to the Suezmaxes and Very Large Crude Carriers (VLCCs) will not be able to transit the Canal, according to Lloyd's List Intelligence. Alternatively, the expansion will allow the Canal to accommodate a higher percentage of the world's liquefied natural gas fleet, greatly shortening the distance U.S. LNG exports must travel and thereby making them more competitive in the Asian market.
  • Approximately 132,000 barrels per day (b/d) of crude oil and 882,000 b/d of other petroleum production were transported through the Canal in 2015.
  • The Trans-Panama Pipeline (TPP) or Transisthmian Pipeline, which is situated near the Costa Rican border, is another oil transit route that reduces transportation times and costs between the Atlantic and Pacific basins. Tanker data suggests that roughly 200,000 b/d of crude oil, most of which is of Colombian and, to a lesser extent, Angolan origin, flowed through the pipeline in 2015, double the amount compared with the previous year.