The Panama Canal Authority is exploring the feasibility of constructing a pipeline to transport liquefied petroleum gas (LPG) across the waterway, potentially facilitating shipments from the U.S. to Japan, Administrator Ricaurte Vasquez told Reuters on Tuesday.

"We're exploring the possibility of rolling out infrastructure with the capacity to move up to a million barrels per day (bpd), but the market is much larger," Vasquez said.

The canal administration considers gas transport a high priority, though Vasquez acknowledged the project's complexity. Initial studies suggest potential LPG traffic through the canal could reach 2 million bpd within a decade.

A decision on whether to proceed with the pipeline is expected within the next year, Vasquez said.

The pipeline proposal comes amid heightened tensions between the U.S. and Panama. Earlier this month, a consortium led by BlackRock acquired the ports of Balboa and Cristobal, located at either end of the canal, for $22.8 billion. 

The deal, which also included stakes in 43 other ports globally, followed President Donald Trump's statements suggesting the U.S. should reclaim control of the canal.

BlackRock paid $19 billion to CK Hutchinson, owned by Hong Kong billionaire Li Ka-Shing, for the Panama ports and the other port holdings.

Last week, President Trump addressed the port deal in a speech to Congress, stating, "My administration will be reclaiming the Panama Canal, and we've already started doing it."

The canal authority's pipeline consideration and the recent port acquisition occur as the U.S. and Panama navigate a period of strained relations.