Monday, 25 August 2014

Panama Canal: 100th Anniversary & Expansion Plans.

The construction of the Panama Canal began in yr. 1904 and was tagged as the most expensive project in US history of its time costing around $375m. It took 10 yrs. for its completion with its first voyage undertaken by a French crane boat Alexandre La Valley on 7th Jan, 1914. Since the first transit a century ago, the Panama Canal has undeniably projected itself as an essential link in the global trade chain.
 
In changing times, the shipping industry has undergone dramatic transformation over the past 100 yrs. Vessels that were considered large in the 1960s are dwarfed by the behemoths operating today. Realising the advancements, the Panama Canal had to respond to this evolution in size or risk losing business as large ships turn to transit via the Capes to avoid the canal’s size constraints. The Panama Canal has had a significant influence on ship development and trade routes since opening in 1914. It marks its 100th anniversary with plans to create a new lane for larger transits, expected to open in 2016, posing new challenges for the maritime community. New locks will enable new Panamax ships (12,600 TEU) to enter the canal. Existing locks only allow for the passage of vessels carrying 4,400 TEU. This expansion will enable between 12 and 14 larger vessels per day i.e. (approx. 4,750 additional ships a year) to transit the canal. The increased size of these vessels, particularly container ships of 12,600 TEU, will play a critical role in doubling the annual cargo capacity of the canal to 600 million PCUMs tons [Panama Canal Universal Measurement System].
 
The expansion plan at $5.25 bn began on 3 Sept, 2007 after six years of study and its approval. The project will see two new sets of locks constructed adding a third transit lane. The project also includes the deepening and widening of the canal entrances, excavation of a new north access channel for the pacific post – Panamax locks; elevation of Gatun lake’s (an artificial lake to the south of Panama which forms a major part of the canal) maximum operation level, and the deepening and widening of the Gatun lake and Culebra Cut navigational channels. The scheduled opening date for commercial transits is 2016.
It can be clearly stated as we draw to close the scheduled opening of the new canal, the Panama Canal has been shaping shipping business for the past century and its plan for the future promises an even greater influence over the world trading patterns going forward.

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