I thought I would share some macro news I have come across in...

I thought I would share some macro news I have come across in the last couple of days:

Panama Canal to attract LNG players through agreement with Port of Lake Charles


The Panama Canal Authority said it has signed a cooperation agreement with the Port of Lake Charles in Louisiana, which aims to attract new customers from the liquefied natural gas industry.

This is a strategy that builds upon the advantages that the expanded Canal will offer. Currently, LNG vessels cannot transit through the waterway due to their beam dimensions, which are too wide to fit the existing locks.
The agreement will promote cooperation in marketing activities, information exchange, market research, training and technology, among other initiatives that will benefit both the Canal and the Port of Lake Charles.
Several companies are expected to either start construction of new plants or expand their existing LNG liquefaction capacity over the coming years in the region, with the aim of exporting their product mainly to Asia through the Panama Canal. While in Louisiana, the parties responsible for signing the agreement, Jorge Quijano, Panama Canal Administrator/CEO and the Executive Director of the Port of Lake Charles, William J. Rase, were joined in a series of meetings by companies such as Southern California Telegraph & Energy LNG; Magnolia LNG; Venture Global LNG; Lake Charles LNG Company; Cameron LNG; Waller Point Marine and BG Group. While touring Louisiana, Administrator Quijano discussed progress on the Panama Canal Expansion Program with businesspeople, government officials and representatives of Lake Charles’ Chamber of Commerce, including members of the Alliance for Economic Development. The tour included participation in a panel discussion with investors who are scheduled to build new LNG liquefaction plants with the Canal Expansion in mind. The Administrator also visited the construction site of Cheniere, a gas liquefaction plant located in Cameron, Louisiana, which will begin production in the first quarter of 2016.

Baupost Group buys Hoegh LNG shares for clients


The Baupost Group said it has acquired 200,000 shares in Norway’s Höegh LNG on behalf of several clients.

Following the transaction, the aggregate shareholding in HLNG over which Baupost is authorized to exercise voting rights on a discretionary basis amounts to 3,677,467 shares, equaling 5.26 % of the issued shares and votes in HLNG, the company said in a statement.
No single client of Baupost holds more than 5 % in HLNG after the acquisition, it added.

Panama Canal: LNG to be priced based on cubic meters


The Panama Canal Authority made a proposal for a new toll structure, following more than a year of informal consultations with representatives from various industry segments.

The proposed restructuring calls for each segment to be priced based upon different units of measurement, while aligning with customers’ needs and requests, and modifying pricing for all canal segments. For instance, LNG will be based on cubic meters.
Pricing for containers will be measured and priced on TEUs, dry bulkers will be based on deadweight tonnage capacity and metric tons of cargo, passenger vessels will be based on berths and tankers will be measured and priced on Panama canal tons and metric tons.
The new structure will apply to the existing canal as well as the new lane of traffic when the expansion project begins operation in 2016. The new locks will allow shipping lines to transit the canal with larger ships, providing greater economies of scale. Moreover, the expansion will open new global shipping routes and allow the transit of non-traditional commodities through the waterway, such as liquefied natural gas.