Four new ACP mega projects

By: Franklin Castrellón

The Panama Canal Authority (ACP) has announced the development of four mega projects in addition to the Port of Corozal. According to its administrator, Jorge L. Quijano, it will add value to the Panamanian route and boost the development of the country as a global logistics hub. The plan is to create a logistics park, a terminal for liquid natural gas (LNG) ships, another port for car carrier vessels and a photovoltaic generation plant.

Photovoltic Plant.

Photovoltic Plant.

The Port of Corozal is already in its final phase, after the ACP made the announcement that on January 3, 2017, it will tender its development and operation among the four global port operators that were pre-qualified. They are: APM Terminals B.V., from Holland; PSA International Pte.Ltd., Singapore; Terminal Link, France and Terminal Investment Limited, S.A., Holland. This project will be executed in two phases and will cost more than $1 billion, and generate around 3,000 jobs.

Corozal will solve the port capacity deficit in the Pacific littoral and will attract some of the services that have deviated to Colombian ports (Buenaventura and Cartagena) and Jamaica (Kingston) for that reason. Also, the new terminal, will allow Panama to take advantage of the shipping mega-alliances growing demand for transshipment services. Currently 77% of the container vessels that are Canal users dock here to carry out transshipments and the demand will increase with the Neo-panamax ships transiting the waterway.

Ro-Ro Terminal

Ro-Ro Terminal.

“The ACP incursion into projects which are different to the transit of ships, a power given by article 316 of the Constitution and article 18 of its Organic Law, started to take shape in 1998, when the Canal Commission hired Louis Berger, Arthur Andersen and Booz Allen Hamilton to make three studies respectively and recommend possible businesses, so the future ACP could expand its income base”, explained Rodolfo Sabonge, former ACP Planification and Commercial Development vice-president.

“The concept was consolidated by another study made by the consulting firm Bain & Co in 2012. The results from the report demonstrated that the ACP has a good potential to exploit its competitive advantages and available land to develop commercial activities, that will not only generate additional income for the country, but also make the route more attractive,” he said.

The ACP wants to build a terminal for natural liquid gas ships.

The ACP wants to build a terminal for natural liquid gas ships.

New projects

LNG Terminal.

LNG Terminal.

“The new projects are the product of the studies made by international consulting companies”, said Quijano. “With regards to the commercial development of 1,200 hectares on the west side of the Pacific entrance, the firm, Ante Group, of Holland, outlined a master plan to serve as guide for the use of the land for the development of these areas,” he added and pointed out that the feasibility study should be ready at the end of 2017.

With regards to a terminal dedicated to vehicles and heavy equipment, the firm HDR of the United States, did a feasibility study together with industry experts. The report about the technical and financial viability of a terminal for Liquid Natural Gas (LNG) is in the process of being tendered and awarded. It should be ready in mid-2017

Logistics Park

Logistics Park.

Talking about a Ro-Ro ship terminal, the studies will help to improve the project and define the tendering terms. “We estimate that this project will be tendered in the second half of 2017,” said Quijano. Less progress has been made with the photovoltaic plant which will produce solar energy and has taken impulse in the world as an alternative source which is not a contaminant. It is calculated that worldwide photovoltaic energy plants will produce 300 gigawatts.

Quijano said that all these projects should make the Panamanian route more competitive by providing the services required by ships and cargo. “When a vessel arrives in Panama, it not only needs to cross the Canal, but also needs port services, fueling, crew changes etc. For that reason, if one of the services they receive in Panama does not meet their expectations, the Panama route will not be attractive,” he said.

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