Panama Canal Expansion ends

Finally, a year and a half late, the expansion of the Panama Canal is finished and the first ship has crossed in what will be the new era of this important seaway.

The recent scandal of the “Panama Papers” has passed into the background with the good news of the opening of the new canal locks. After seven years the consortium Grupo Unidos por el Canal (GUPC) has handed over the works to the government of President Juan Carlos Varela.

On June 26 the container ship previously known as “Andronikos” now Cosco Shipping Panama, of the Chinese company Cosco, was the first ship to pass through the new locks of the Panama Canal. That day, in the presence of 70 heads of State and representatives of major shipping companies he long journey undertaken in 2007 ended. Given the magnitude of the project, its technical complexity and the multi-million investment required, a referendum required for its construction was endorsed by 78 percent of the voters.

The “Andronikos” changed its name to Cosco Shipping Panama to commemorate the third set of locks.

The “Andronikos” changed its name to Cosco Shipping Panama to commemorate the third set of locks.

It was a work similar in magnitude to the construction of the original Canal.

The main objective in this second stage was to modernize the infrastructure that was lagging behind the needs of the modern maritime industry.

The works included a third set of locks to allow transit of Super Post Panamax and Post Panamax ships, with load capacity of up to 14,000 containers (TEUs). That is, almost three times the load of ships using the actual locks, which carry a maximum of 4,500 containers. Additionally, a new Pacific access channel was built and the maximum operating level of Gatun was raised, which is one of the largest artificial lakes in the world. For this purpose it was necessary to use more than 220,000 tons of steel (equivalent to 22 Eiffel Towers).

The total investment value amounted to $5,581 million. And although its opening was lavish, this mega project was not without problems to complete. It was scheduled to end in October 2014, but it has been turned over almost 18 months later due to several strikes. To this was added a conflict with the Panama Canal Authority (ACP), for the cost overruns of the work, claimed by the GUPC consortium led by the Spanish firm Sacyr and made up of Italy’s Impregilo, Belgium’s Jan de Nul and Panama’s Constructora Urbana. They currently have a claim of $2,845 million.

There has also been much debate over tough competition that awaits the expanded canal. Not only is there the construction of a Nicaraguan Canal.

In any case, Panama has opened its masterpiece, with which it expects to take a slice of international trade. About 5 percent of global cargo moves through the Panama Canal, and its main users are the United States and China.

The expansion will allow greater competition in shipping rates (a reduction of 20 percent is estimated). In recent years the shipping industry has been endowed with the gigantic Post Panamax ships to save costs and time of movements. It will also open opportunities for larger cruise ships and facilitate the transport of gas from the US to Asian countries.

Panama Canal Expansion ends“The canal expansion is crucial for trade in Latin America because it opens great opportunities to export thermal coal and refined crude oil to the US and Asia,” says Oscar Bazan, a marketing official of the Panama Canal Authority, who states that Colombia will be one of the countries that benefits most.

This comment is matched by the Colombian Federation of Logistics Agents (Fitac) which states that in recent years the Colombian ports have raised their standards to international levels.

From the moment that work began on the Canal a revolution also began in the major ports of Latin America to receive Post Panamax vessels. Colombia, for example, has made huge investments in Cartagena, Barranquilla and Buenaventura.

In the case of the former, they have invested about $1,000 million in expanding and modernizing by the Port Society and Contecar. Last year five Post Panamax gantry cranes were installed, 25 stories high, and six more are under construction that will arrive next year. Further work was done to deepen the access channel to the bay to allow the passage of these giant ships. The goal is to use the canal expansion to consolidate this Caribbean port as one of the great maritime hubs in the region. It is able to handle 3 million containers and at the end of next year, 5.5 million.

Dozens of giant container ships asked to be the first to go through the new canal. Soon this work will make much impact on world trade, becoming a landmark of global engineering.

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