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Friday, August 22 2014 @ 03:54 AM EDT

Delay Confirmed on Panama Canal Expansion Project

Canal ExpansionPanama Canal Authority officials have announced on national television that the Canal expansion project, which is expected to result in lower shipping costs and emissions as well as greater capacity and efficiency, has fallen six months behind schedule. The $5.25 billion dollar expansion project will result in an increased beam constraint from 32.2 meters to 49 meters enabling larger ships to transport more goods in fewer trips. According to a study in the International Journal of Maritime Engineering and referenced in the Nature News Blog, the potential savings in both fuel and reduced emissions may be as great as 16% per tonne-mile.

Delays - On April 4 2012 it was reported by the Journal of Commerce that the consortium responsible for building the new locks, Grupo Unidos por el Canal (GUPC), submitted a letter to the Panama Canal Authority with a new work schedule indicating an expected completion date six months behind the original target date of October 2014 - 100 years after the canal was first completed. According to Alberto Aleman Zubieta, the Panama Canal Authority's Chief Executive Officer, "the company is trying to catch up with lost time."

In December of 2011, the project was reported to be "at least one year behind schedule" and in March 2012, Zubieta said the project was "delayed at least seven months," and that GUPC was accelerating the work in an attempt to make the original deadline. According to the contract, a penalty of $300,000 per day will be applied if GUPC cannot complete the locks on time.

In an early June statement by the Panama Canal Authority, officials reported that the first monolith for the new locks was completed, marking an important milestone. The delay to April 2015 is a result of GUPC's difficulty in meeting its contractual agreements for the standards of the concrete mix for the locks, which delayed the laying of the concrete from January to July of 2011. (shipandbunker.com)

Editor's Comment: This isn't news for Panama Guide readers. I was the first one to report on the real and factual details of these delays, and only now the contractors and representative from the Panamanian government are starting to begrudgingly accept and report the facts. They fell way behind, and then were still falling farther behind and have since been trying like hell to make up for lost time. They have been trying to blame the delays on one thing or another, but my inside sources tell me the delays are actually being caused mostly by poor or inadequate management of the movement of people and logistics on the job site. They tell me stories of heavy equipment that can't move because there's no fuel for it, things like that. But guess what? Name one very large public works project that has not faced any delays. There are none. All large projects such as this are bound to face delays, sooner or later. However the bottom line won't change very much. The expanded Panama Canal will eventually be completed, more and larger ships will pass through, the government of Panama will make even more money off of the canal, and everything will be just fine.

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