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Friday, June 23 2017 @ 10:02 PM EDT

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Sacyr May Earn $31 Million a Year From Panama Canal, Cinco Says

Canal ExpansionBy Ben Sills (Bloomberg) Sacyr Vallehermosa SA may earn $30.9 million a year over the five-year contract for expanding the Panama Canal, Cinco Dias reported, citing people close to the Panamanian government without naming them. The project, in which Sacyr owns a 48 percent stake, may earn $322 million before interest, tax, depreciation and amortization over the period, giving it a 10 percent profit margin, the newspaper said. The company is assuming it will have a margin of at least 6 percent, the newspaper said, citing people in the industry. It said that Sacyr declined to comment.
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Panama Canal Expansion Now 20% Complete

Canal ExpansionThe project to expand the Panama Canal has advanced by some 20%, and contracts worth a total of more than $4 billion dollars, of the estimated total of $5.25 billion, have been awarded according to the Panama Canal Authority (ACP). The ACP administrator Alberto Zubieta German, introduced the financial report to the Commission on Public Infrastructure and Canal Affairs of the National Assembly. The modernization process includes the widening and deepening of the access channels ships use to enter the Panama Canal from both the Atlantic and Pacific oceans, as well as the deepening of the 13 kilometers of the Gaillard Cut that is considered to be the most narrow part of the waterway. The project also includes the construction of a new interconnection channel to access the new locks from the Pacific side with an approximate length of 6.1 kilometers, and another new access on the Atlantic side as well.

The largest segment of this multi-billion dollar mega project is the construction of two new locks, which will be located at the entrance to both Pacific and Atlantic, to allow for the passage of the giant PostPanamax ships. The corporation responsible for building these locks is Grupo Unidos por el Canal (GUPC), which is led by the Spanish company Sacyr Vallehermoso and is accompanied by Italy's Impregilo, the Panamanian company Constructora Urbana, and Belgium's Jan de Nul. This business group was awarded the work for $3.118 billion dollars and due to the magnitude of the locks project they expect to hire about 7,000 people over the next three years.

According to estimates by the ACP with the completion of the expansion works in 2014, after seven years of continuous work, the new Panama Canal will double its capacity from 300 million to 600 million tons annually. During the presentation of the report, Aleman Zubieta also announced that on 29 April 2011 they will be opening the proposals, delivered in a sealed envelopes, to hire the company for the design of a third bridge over the Panama Canal. The Panama Canal operations during fiscal 2010, ended with toll revenues of $1.482 billion dollars, an increase of 3% over 2009 in which they received $1.43 billion dollars. (La Prensa)

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Scott sends $77M to Port of Miami in light of Panama Canal work

Canal ExpansionGov. Rick Scott said Friday that he is redirecting $77 million in Florida Department of Transportation funds to help dredge the Port of Miami to 50 feet deep. The deeper channel will help the port accommodate larger cargo ships expected to use the expanded Panama Canal. Scott’s office could not immediately say what projects the money was being redirected from, how it arrived at the estimate the project will create 30,000 jobs or whether any similar funding might be steered toward Tampa. Tampa Port Authority CEO Richard Wainio said he was told of Scott’s decision about the Miami port early Friday. “I am pleased that Governor Scott has shown a strong understanding of the importance of trade for the Florida economy and a desire to help fund Florida’s important seaport projects,” Wainio said in a statement. “Accordingly, I am confident that Governor Scott and the Florida Legislature will approve additional funding for other important port projects to include several projects under development at the Port of Tampa.” Scott made the announcement at the Miami waterfront minutes after the Florida Supreme Court upheld his decision to reject $2.4 billion in federal funding to build a high-speed rail line between Tampa and Orlando. “This is the type of infrastructure project that will pay permanent, long-term dividends, and provide a solid return on investment for Florida’s taxpayers,” he said in a statement. (bizjournals.com)
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Port Manatee readies to expand as Florida exports escalate

Canal ExpansionBy JENNIFER RICH - MANATEE -- New figures rank Florida as the nation’s fourth largest export state even as facilities like Port Manatee ready themselves for an increase in traffic expected from the Panama Canal expansion. The state’s exports grew by nearly 18 percent in 2009-10 from the previous year, moving it into fourth place behind Texas (1), California (2) and New York (3), according to U.S. Department of Commerce figures. Although the number of exports at Port Manatee are overshadowed by its imports, Steve Tyndal, senior director of trade development and special projects, says the overall growth in state exports shows there is great potential for Port Manatee to grow. “Florida exports are typically high value, and high value cargo is more often shipped in containers,” Tyndal said. “We want to get in that business for a variety of reasons, it creates more revenue for the port, but also creates more jobs for the region.” The port soon will be completing the final part of a nearly $200 million, 11-year expansion when it begins dredging Berth 12 in April to a depth of 41 feet and extending it from 1,000 feet to 1,584 feet to accommodate container vessels.

The new berth sits adjacent to a planned 52-acre container terminal on the port’s south side that is all part of the port’s plans to take advantage of the completion of the Panama Canal expansion in 2014. Phase one of the container terminal project will begin this year, according to Tyndal, with expected completion by 2014. Tyndal said the port’s expansion will “let container lines and shippers know we are serious about establishing ourself in the container business.” Florida’s move up in export rankings shows the state is serious about becoming a major international trade player, officials say. “Being ranked above four states in as little as six years is a tremendous feat in trade,” said Manny Mencía, Enterprise Florida’s senior vice president overseeing its International Trade & Business Development division. Enterprise Florida is the state’s economic development arm. Since December, the agency has opened offices in São Paulo, Brazil, and Montreal, and is hosting export sales missions to Chile and Peru in May.

The overall growth in U.S. exports last year came after a dip for most ports because of the country’s financial crisis, said John Murphy, vice president for international affairs with the U.S. Chamber of Commerce in Washington, D.C. “It hammered international trade more than the rest of the economy except maybe housing,” he said. “Credit markets seized up and globally we saw 20 and 30 percent declines (in trade),” Murphy said. “Last year the U.S. and other countries came roaring back.” Florida’s exports had dropped 13.6 percent in 2008-09 from the previous year. The value of the dollar, lower tariffs and stronger economic growth has increased exports, Murphy said. He thinks Florida has been very aggressive in growing its international trade, particularly with South American countries and the Caribbean. That’s a change from the past when in the early 1990s, the state was a minor trade partner. “The state of Florida is well positioned with the widening of the canal, which will make trade even cheaper,” he said.

More companies overall are looking to export, says Sandra Campbell, director of the U.S. Commercial Service with the Department of Commerce, a trade promotion agency in Clearwater. “Our goal is to steadily grow our exports in the next five years,” she said. “We are the gateway for the Caribbean and South America.”

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Construction Begins on New Lock for Panama Canal Expansion

Canal ExpansionThe construction of what will be the new lock of the Panama Canal began this year, within the time allowed, according to the consortium Grupo Unidos Por el Canal (GUPC), that is responsible for the project. The cost of the project to expand the Panama Canal is estimated at $5.25 billion dollars, and should be ready by 2014. Antonio Zaffaroni, GUPC consortium's executive director, said today that the excavations have reached the expected level of progress, "we have completed the installation of the industrial plants and have started with the concrete." This means - the executive explained - that "we have entered the industrial process" to build the third set of locks during the next three years. Under the expansion project, construction of the third set of locks is estimated to cost $2.73 billion dollars and the water saving basins $620 million. This represents 65% of the total cost of the project. Zaffaroni said production will increase gradually and by the end of 2011 it is expected that the work will be between 25% to 30% completed. Today, he said, there are 2,500 people working on this project (in the physical part) and as the demand for labor increases it will peak at 5,000 workers. (La Prensa)

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US ports race to keep up with bigger Panama Canal

Canal ExpansionBy RUSS BYNUM - SAVANNAH, GA. - East Coast seaports from New York to Miami are in a race for government permits and funding to dig deeper harbors. The ports need more room to handle giant cargo ships expected to sail through an expanded Panama Canal in just a few years. By the end of 2014, the Panama Canal is expected to allow passage of ships loaded with more than double the amount of cargo of most vessels now calling on the Atlantic Coast. The supersize ships need up to 50 feet of water to navigate. Only the port at Norfolk, Va., is that deep on the eastern seaboard. The port of New York/New Jersey already has a $2.3 billion project underway to dredge its harbor. Port officials in Savannah, Ga., are seeking a $588 million deepening. Charleston, S.C., and Miami are also in the hunt. (Business Week)
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Port of Tampa leaders hear Panama Canal expansion is on schedule

Canal ExpansionTampa Bay Business Journal - by Mark Holan , Staff Writer - An ambitious expansion of the Panama Canal remains on track for 2014 completion. Port of Tampa and Port Manatee officials expect to see more traffic as a result. The Panama Canal Authority’s top executive told maritime officials in Tampa Tuesday that after completion the amount of cargo moved will quadruple compared with what was moved in 2000. Larger vessels will travel more quickly through the 48-mile ship canal. “Everything so far is going in the right direction,” Alberto Aleman Zubieta said during remarks at the fourth annual Shifting International Trade Routes conference at the Grand Hyatt Tampa Bay. “This is a game changer.” Panama is using the canal expansion to develop its own port with some dredge material being used to increase landside facilities on the Atlantic and Pacific ends of the canal. “We are the only port in the world with two oceans,” Zubieta said.

The Canal Authority is sponsoring the Retail Industry Leaders Association Logistics Conference Feb. 20-23 in Orlando. It will bring together representatives of all major retail and consumer product segments, along with service providers. Zubieta sidestepped a question about a toll increase to pay for the $5.25 billion project, saying his agency would adjust tolls to remain competitive. “Ships will move to whoever has the best service at the best cost,” he said. U.S. Maritime Administration chief David Matsuda said his agency is studying how the canal expansion will impact commerce and infrastructure requirements in America. The agency expects to release a series of reports beginning in the second quarter.

Tampa Port Director Richard Wainio expressed concern about the United States falling behind in infrastructure investment. “If we do not modernize soon we will not lead in the 21st century; we will follow,” he said. The Shifting International Trade Routes conference continues through lunchtime Wednesday with discussions about distribution and warehousing, and highway and railroad perspectives.

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Some business leaders worry Panama Canal expansion could threaten jobs in Valley, region

Canal ExpansionBy Kevin Smith, Staff Writer - International trade has long been one of Southern California's top economic drivers, but some business leaders fear that expansion of the Panama Canal could divert freight movement away from Southland ports and threaten much-needed jobs in the San Gabriel Valley and beyond. A diversion of goods could slow business for scores of importers and logistics and warehousing operations in Industry. A project to widen and deepen the Panama Canal is scheduled to be completed in 2014. The expansion includes the construction of two new sets of locks - one on the Pacific side and one on the Atlantic side - as well as the widening and deepening of existing navigational channels. The expansion will allow the canal to take on bigger ships. More importantly, it will make ports in the southern and eastern United States more desirable to Asian shippers. "There are some very significant concerns," said Lee Harrington, executive director of the Southern California Leadership Council. "If you look at the big picture, one in four jobs in California is related to trade flows." Much is being done to streamline and speed the flow of goods moving to and from the ports of Los Angeles and Long Beach, and more projects are planned, but if some of those planned improvements aren't stepped up, freight movement at the ports may erode and jobs will be lost, according to Harrington. "The Panama Canal is being built with the objective of taking away a big part of our market share in terms of trade flow," he said. "A 25 percent cut in our market share is not inconceivable." (more)
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Councilwoman: N.C. not ready for Panama Canal expansion

Canal Expansionby Shelby Sebens - Councilwoman Laura Padgett went to Panama last month to get a look at the Panama Canal expansion which will bring larger ships to the east coast. Padgett said the opening of the new locks in 2014 will be an economic opportunity for east coast states and North Carolina needs to get ready if it wants a piece of the pie. She chided the state for moving away from the proposed N.C. International Terminal near Southport. She said N.C. ports need be getting ready to accommodate the larger vessels. “If we don’t we miss a huge economic, job building opportunity for all of the eastern half of NC,” she said. (Star News Online - Cape Fear Watchdogs)
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Panama denies WikiLeaks report of canal trouble

Canal Expansion(AFP) Panamanian President Ricardo Martinelli says he had total confidence in the expansion of the critical Panama Canal, denying it was a "disaster," as a US ambassador said in a diplomatic cable released by WikiLeaks. "We are here to show our support for all the work that has been done to date by the Canal Administrator and his entire team. This is a project that will benefit the country and the entire world," Mr Martinelli said in a statement issued after a visit to the site. His comments were the first government reaction to a leaked diplomatic cable in which then-US ambassador to Panama Barbara Stephenson described the vice president's deep concerns over the project.

According to a January 2010 memo, Vice President and Foreign Minister Juan Carlos Varela told the US representative: "The canal expansion project is a disaster." "In two or three years, it will be obvious this was all a failure," he said, adding he was worried about the financial stability of the consortium expanding the canal. Ms Stephenson also reported that Mr Martinelli himself had "grimaced" when asked how the project was going and had indicated he was worried the construction bid had been tipped to a group that included the canal administrator's cousin.

An international consortium, led by Spain's Sacyr, won a $3 billion bid in 2009 to expand the canal's locks. - AFP

Editor's Comment: And now, when high ranking Panamanian politicians talk to the US Ambassador, they will only discuss the weather ... "My, these crumpets are delightful. Have you tried the shrimp dip?" The President then "grimaced" and said "the last time, they gave me gas." No doubt, this whole Wikileaks thing is going over like a fart in church.

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Port Manatee: Full steam ahead for 2011

Canal ExpansionBy GRACE GAGLIANO - PALMETTO - Port Manatee has a full slate of projects ahead for 2011. Improvements to the south port area will be under way, port staff and consultants will work on identifying new business consistent with the Panama Canal expansion, and the Manatee County Port Authority will search for a successor to port Director David McDonald, who retires in January 2012. 2010 brought a wealth of fortunate news for the port. It was awarded $15 million in federal and state grants to develop the south port area. The port also gained business from several new tenants that include Martin Marietta and Port Dolphin. A new aggregate terminal by Martin Marrietta, set up in the fall, is expected to bring in $600,000 to $700,000 annually. And payments from Port Dolphin, a natural gas pipeline to run from about 30 miles off Anna Maria Island to Port Manatee, are projected to be nearly $1 million next year. (more)
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Canal administrator rejects criticism from Panama gov't

Canal Expansion(Fox News) Panama City – The Panama Canal's administrator downplayed government criticism of the process of expanding the waterway cited in U.S. diplomatic cables disseminated by WikiLeaks. "I'm not going to pay much attention to those types of things," Alberto Aleman Zubieta told reporters Wednesday at the headquarters of the Panama Canal Authority, referring to alleged criticism from President Ricardo Martinelli and Vice President Juan Carlos Varela. In a January message to the State Department, then-U.S. Ambassador Barbara Stephenson reported on meetings in which Martinelli and Varela criticized the canal expansion process and warned of its possible failure. "I'm not going to get into things that they supposedly said," Aleman said Wednesday. "I look at the factual reality." (more)
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Port of Galveston signs MOU with Panama Canal Authority

Canal ExpansionBy Barrett Goldsmith (Houston Business Journal) - The Panama Canal Authority said Wednesday that it had signed a memorandum of understanding with the Port of Galveston to improve trade along the route between Asia and the United States. At a ceremony in Panama City, Alberto Zubieta, the authority's chief executive and administrator, and Port of Galveston Director Steven Cernak signed the MOU to “facilitate international trade and generate new business by promoting the All-Water Route,” according to a release. The MOU spells out initiatives for joint marketing, data exchange, collaborative market studies, modernization, improvements, mutual training and technological interchange between the two entities. “As the ‘gateway to the Gulf,’ the Port of Galveston facilitates the movement of a varied mix of domestic and international cargo generating an economic impact of more than $1 billion for the state of Texas,” Cernak said at the signing ceremony. “We, too, look forward to this new partnership with the ACP and the opportunities it will bring for continued fiscal growth and viability for both Panama and Texas."
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Port of Charleson "will lose out" if dredging doesn't happen

Canal ExpansionWCSC reports that the State Ports Authority officials say Port of Charleston "could end up losing out on a lot of business" if the harbour is not deepened. The officials recently visited the Panama Canal and say an expansion project there will have an impact on Charleston. Ports authority officials, state lawmakers, and Charleston business leaders saw the expansion site, which is set to be complete by 2014. It means bigger container ships will be able to pass through and change cargo shipping globally. "Ships today with a maximum size of 5,000 TEUs can go through the canal. In the future that will be 13,000," TEUs. It's probably the biggest game changer in the history of containerization," said SCSPA President Jim Newsome. Newsome says if South Carolina wants business from companies with the larger container ships, then the Army Corps of Engineers needs to start a Charleston Harbour deepening project soon. Before the harbour is dredged the state must secure money from the federal government to do an impact study. Port officials say to handle the bigger ships the channel needs to be at least 5ft deeper. (www.sandandgravel.com)
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Panama Canal project a big opportunity for Charleston's port

Canal ExpansionBY ALLYSON BIRD - CHARLESTON — State Ports Authority chief Jim Newsome today called the Panama Canal expansion a "3 million container opportunity" for Charleston. Speaking at the Charleston Metro Chamber of Commerce Developers Council's annual growth forum, Newsome pointed out the chance to capture container traffic currently passing through West Coast ports. The canal expansion is set to be completed in 2014, and a local delegation recently toured the project. Newsome pointed to the work the state must finish in order to compete for the wave of new business. That includes building a network of distribution centers while developing competitive rail and continuing progress on its container terminal under construction at the former Navy base in North Charleston.

He said little about the contentious debate on Capitol Hill over funding for harbor deepening, which requires an earmark that Republican Sen. Jim DeMint will not lend support. "It is very important that we keep our harbor-deepening project on track," Newsome said. "I don't want to get into an arcane discussion about earmarks." (The Post and Courier)

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On the Waterfront: Impact from Panama Canal expansion is focus of forum

Canal ExpansionBy Kristopher Hanson - It's perhaps the biggest economic question - and potential threat - that Long Beach and its neighboring cities have faced in decades. And it couldn't come at a more trying time for dockworkers, mariners, truckers and business leaders struggling with a global recession and severely depressed trade volumes through San Pedro Bay. The Panama Canal is midway through the biggest expansion in its 100-year history, a $5.25 billion renovation designed to accommodate new generations of mega ships and tankers currently unable to squeeze through the aging waterway. If, as many predict, the expansion proves a success, the canal would siphon millions of containers and thousands of ships - and jobs - from the ports of Long Beach and Los Angeles each year. (more)
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Lawmakers wrestle with rail access to new SC port

Canal ExpansionBy BRUCE SMITH (AP) – CHARLESTON, S.C. — South Carolina lawmakers began wrestling Thursday with providing rail access to a new $525 million port terminal as the state works to regain its competitive position among other East Coast ports. Lawmakers were urged to develop a plan that doesn't jeopardize a $1 billion North Charleston urban renewal project or harm a predominantly black community nearby. South Carolina has a "a unique, one-time opportunity" with larger ships that will call after the Panama Canal is widened in 2014, said State Sen. Larry Grooms, R-Bonneau, and chairman of the Review and Oversight Commission on the South Carolina Ports Authority. He said the state needs to be prepared or business will flow to other ports. Charleston, once the second-largest container port on the East Coast, has in recent years fallen behind. Now it's fourth, behind New York-New Jersey, southeast Virginia and Savannah, Ga. (more)
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Dredging towards the centenary of the Panama Canal

Canal Expansion A new custom-built cutter suction dredger destined for the Panama Canal has been launched by IHC Merwede on Monday 6 September. The 12,000kW vessel has been designed and built by IHC Beaver Dredgers at its Sliedrecht shipyard in The Netherlands for the Panama Canal Authority* (ACP – the Panama Government’s autonomous agency). QUIBIÁN I** was named and launched before invited guests at Sliedrecht, and will now be completed to IHC Merwede’s exacting quality standards. The vessel will be delivered to ACP in April 2011, within the schedule agreed when the contract was signed in March 2008.

The cutter suction dredger will work on the Panama Canal’s ongoing expansion programme in the run-up to its centenary in 2014. After this notable historic landmark, it will continue to be used for ongoing maintenance work and future modernization projects. The new addition to ACP’s fleet will have the capacity to dredge along the entire 80-kilometre shipping route that joins the Pacific Ocean to the Atlantic Ocean. (more)

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Panama Canal Expansion Project 13% Complete

Canal Expansion As of today, the work on the to expand the Panama Canal has been underway for three years, and thus far 13% of the project has been completed. The expansion of the waterway adds one more lane to the existing two. The main component of the expansion is the construction of new locks in the Pacific and Atlantic sectors. During the past three years work has been concentrated in the removal of dirt and dredged materials, and preparing for the construction of the third set of locks by GUPC. The new locks, the size of four football fields, will allow the transit of so-called post Panamax ships, with a capacity to carry 12,000 containers, three times more than the ships that currently fit through the Panama Canal. The ACP has established 21 October 2014 for the completion of the work for the main contract, the consortium United for Panama Canal (GUPC), which will be paid $215,000 for each additional day of early completion. (Panama America)
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Hill International to Provide Project Oversight Services for $5.25 Billion Expansion of Panama Canal

Canal ExpansionMARLTON, N.J. and PANAMA CITY, Panama -- Hill International, the global leader in managing construction risk, announced today that it has been awarded a contract from the Panama Canal Authority (ACP) to provide project oversight services for the Panama Canal Expansion Program. The Panama Canal is a 50-mile long, three-step lock waterway, connecting the Atlantic and Pacific oceans across the Isthmus of Panama. The Panama Canal Expansion Program entails building a third lane of traffic along the waterway through the construction of a new set of locks and other navigation channel improvements. The expansion, which is estimated to cost $5.25 billion and is scheduled to be completed by the fourth quarter of 2014, will double the Canal's capacity and allow more traffic, which in turn will spur economic growth and maintain the Canal's competitive advantage.

"We are extremely honored to have been selected by ACP to participate in this historic expansion program at the Panama Canal," said David L. Richter, Hill's President and Chief Operating Officer. ACP is the autonomous entity of the Government of Panama that has operated the Canal since December 31, 1999, following its transfer from the United States by virtue of the Panama Canal Treaty of 1977. For more information on ACP, please visit their website at www.pancanal.com.

Hill International, with 2,500 employees in 90 offices worldwide, provides program management, project management, construction management and construction claims and consulting services. Engineering News-Record magazine recently ranked Hill as the 8th largest construction management firm in the United States. For more information on Hill, please visit our website at www.hillintl.com.

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Mexico's Cemex announces Panama Canal contract

Canal ExpansionMexican buildings supplies giant Cemex SAB says it has signed a contract to supply 500,000 tons of cement for the Panama Canal expansion project. The Monterrey, Mexico-based company says the cement will be destined for the construction of a third set of locks on the waterway. The company said it has invested about $300 million in its Panama operations over the last two years, and has tripled its cement production capacity there. Panama has embarked on a $5.25 billion project to expand the canal to allow the largest container ships to travel the waterway. The project is due for completion in 2014. (Business Week)
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Consortium says Panama Canal strike lifted

Canal ExpansionA spokesman for the GUPC consortium handling the main contract for the expansion of the Panama Canal has told local media that last week's strike by workers has been lifted. According to a report by International Construction, GUPC head of human resources, Edgar Ochomovo told local reporters that the dispute over pay and conditions had been resolved thanks to government mediation and direct negotiations with workers. Wages are being kept at the US$ 2.90 per hour minimum originally agreed in a collective bargaining agreement, but the two sides are understood to have settled on better working conditions. The successful round of talks appears to have taken place without the participation of the Sindicato Único Nacional de Trabajadores de la Industria de la Construcción y Similares (SUNTRACS) construction union, which met twice with the consortium last week, but failed to settle on a deal. SUNTRACS secretary general Genaro Lopez was quoted in local media as saying he was not aware that the strike had been lifted.

The GUPC consortium comprises Italy's Impregilo, Spain's Sacyr, Belgian dredging specialist Jan de Nul and Panamanian contractor Constructora Urbana. The US$ 3.32 billion contract to construct two new flights of locks - one on the Atlantic side and one on the Pacific - was awarded last July by the Panama Canal Authority (ACP). (www.sandandgravel.com)

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Death & strikes hit Panama Canal expansion

Canal ExpansionBy Chris Sleight - Work on the expansion of the Panama Canal has stalled due to the death of a worker and strikes by 700 others seeking pay rises and better working conditions. The disruption came just days after the dignitaries from Panama, Italy and Spain officially inaugurated the expansion project. The expansion work is being carried out by the GUPC consortium led by Italy's Impregilo and including Spain's Sacyr, Belgian dredging specialist Jan de Nul and Panamanian contractor Constructora Urbana. The US$ 3.32 billion contract to construct two new flights of locks - one on the Atlantic side and one on the Pacific - was awarded last July by the Panama Canal Authority (ACP). That worker that died is reported to be a 49 year-old who was killed while working on Jan de Nul's 'Marco Polo' dredger on Lake Gatún, on the Atlantic side of the canal. A spokesperson for Jan de Nul refused to comment on the reports.

Meanwhile between 500 and 700 workers have gone on strike to protest against low pay, poor working conditions and safety standards. Local reports say some 28 of these, all members of the SUNTRACS construction workers' union, have been arrested, although it is not clear on what charges. June 30 saw Panamanian Prime Minister Ricardo Martinelli host a ceremony to mark the start of GUPC's work on the project. Guests included Italian Prime Minister Silvio Berlusconi and Spanish Deputy Premier Manuel Chaves, and the disruption to work so soon after this ceremony is proving to be an embarrassment to the Panamanian government. (www.khl.com)

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Evergreen confirms containership orders

Canal ExpansionAs reported yesterday, the Taiwan-based Evergreen Group has placed the first of its long awaited newbuilding orders with Samsung Heavy Industries and the order is the first concluded for Evergreen account since 2004. The Korean yard will build ten 8,000 TEU ‘L’ class vessels at a cost of $103 million each and will be delivered in 2012-2013, with the last unit scheduled for November 2013. Six of the new vessels are to be built for Evergreen Marine Corp (EMC - the Taiwan listed arm of Evergreen) and four for Evergreen International S.A. (Panama).

The newbuildings will have overall length of 334.8m, a beam of 45.8m and a cruising speed of 24.5 knots and will be the largest vessels in the Evergreen-owned fleet. Although the company declares the vessels’ capacity at 8,000 TEU, the dimensions suggest that the real capacity could be some 20% higher. The ‘L’ class ships will be one row wider than those of Evergreen’s existing 8,073 TEU ‘C’class design, which come with a 42.8m beam. The ‘C’ class ships were built in 2005-2006 and are long term chartered from German owner Conti Reederei.

Evergreen said that “the ten ships are the beginning of a programme of a new generation of container vessels that will be ordered by Evergreen Line from several shipbuilding yards in Asia.” This programme could include up to 92 ships for over 500,000 TEU. Further orders are expected to be placed at STX Shipbuilding and CSBC shortly. STX Shipbuilding had announced last week that it has signed a Letter of Intent in June for a containership order with an unidentified Taiwanese carrier.

The present order at Samsung is the first time that Evergreen has ordered ships directly for its own account at a Korean yard. Until now, all of Evergreen’s vessel series have been built in either Japan or Taiwan. (motorship.com)

Editor's Comment: These are the kinds of ships that will regularly be navigating through the newly expanded Panama Canal once work is completed in August 2014. The new locks of the expanded Panama Canal, measuring 426.72 meters long by 54.86 meters wide and 18.29 meters deep, will be able to easily accommodate these new Evergreen vessels. After the expansion is completed the Panama Canal Authority says they expect revenues from the canal to jump to more than $5 billion dollars per year. They expect annual operating costs to be about $3 billion per year, with the Panama Canal generating about $2 billion in profits which will be turned over to the government of Panama to be spent on social and infrastructure projects. Most of the money spent on annual operations - $3 billion dollars per year - also stays in the local economy, spent on things such as labor, services, materials, fuel, etc. So, the Panama Canal currently brings in about $2 billion in revenues, which will increase substantially once ships like this start paying to go through, carrying almost 10,000 TEU's each. And how do you say "expanded Panama Canal" in Chinese?" Ka'ching!

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Colombia Cementos Argos Gets $65M Panama-Canal Cement Contract

Canal ExpansionBy Inti Landauro - BOGOTA (Dow Jones)--Cementos Argos SA (CEMARGOS.BO), Colombia's largest cement maker, signed a contract to sell $65 million worth of cement and other supplies to the group expanding the Panama Canal. The company will start to supply the group building a new set of locks on the Panama Canal in December and will keep on supplying until the first quarter of 2014, Cementos Argos said Tuesday in a statement. The company's Panamanian unit will manufacture the cement for the canal, though Argos's plant located in the Caribbean port of Cartagena will back up the Panama operations if needed. Over the past five years, Cementos Argos has invested $100 million in Panama to upgrade its operations there. A consortium made up of Sacyr Vallehermoso SA (SYV.MC), Italy's Impregilo SpA (IPG.MI) and other partners last year won the contract to build a new set of locks in the canal for $3.12 billion. The expansion is due to be ready in 2014 and will double the capacity of the Panama Canal. Shares of Cementos Argos were up 1.4% to 11,480 Colombian pesos ($6.11) in recent trading.
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Expansion work begins on Panama Canal

Canal Expansion(IANS/EFE) Expansion work on a third set of locks on the Panama Canal has officially begun. 'Today, a new future begins for the country,' said Panama President Ricardo Martinelli Wednesday at a ceremony jointly presided over by Martinelli, Italian Prime Minister Silvio Berlusconi and Spanish Deputy Premier Manuel Chaves. The function was also attended by the presidents of Colombia, Guatemala and Honduras. The project is being carried out by Grupo Unidos por el Canal, a consortium led by Spain's Sacyr Vallehermoso construction company. The canal, designed in 1904 for ships with a 267-metre length and 28-meter beam, is too small to handle the 'post-Panamax' ships that are three times as big, making it necessary to expand by building the new set of locks. The Panama Canal Authority, a government agency that manages the waterway, wants to double transit capacity. The 80-km canal, which currently handles about five percent of world trade, has been under Panamanian management since Dec 31, 1999, when the US surrendered it in keeping with the 1977 Torrijos-Carter treaties.

Editor's Comment: This contract was for $3.2 billion dollars, the largest single contract of the Panama Canal expansion project. The money will be spent over the next four years, starting yesterday and ending by the summer of 2014 - for the projected opening of the expanded Panama Canal. Economically speaking this project is a wonderful thing for the Republic of Panama in so many ways. The vast majority of the money being spent on this project will remain right here and this contract is a great example. The Consortium will have to pay for manpower, equipment purchase or rental, services, materials, concrete, steel, cables, fuel - you name it. Of course the companies themselves will be making a profit and taking some of that home with them. However most of the money will stay right here in Panama to circulate through the national economy dozens of times before it eventually ends up in someone's savings account. And once the expansion is complete, the capacity of the Panama Canal will be doubled. So will it's revenue and profits. Can I get a "ka-ching" ...

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Dredging International wins key Panama Canal contract

Canal ExpansionThe Panama Canal Authority (ACP) announced today that Dredging International N.V. has been awarded the contract to dredge an area of the Panama Canal's manmade body of water, Gatun Lake. The dredging project is another integral element of the canal's expansion program. After a thorough review of the lowest priced proposal, the ACP awarded the contract to Dredging International N.V. for $39,983,822.82. Listed below are the companies that submitted bids June 1 with their corresponding bid prices in U.S. dollars. Dredging International N.V. - $39,983,822.82 China Harbour Engineering Company (CHEC) - $67,377,423.00 Boskalis International - $85,500,207.49 Great Lakes Dredge & Dock - $72,392,354.34 Van Oord - $97,998.256.97 Jan De Nul - $57,856,939.00

"We are pleased with the competition for this contract for which several premier dredging firms from around the world submitted proposals," said ACP Executive Vice President of Engineering and Program Management Jorge L. Quijano. "The ACP has partnered with Dredging International N.V. in the past and we are confident in its proven expertise to deliver this important component of the Expansion Program. Not only has the ACP benefited from a competitive price that is within the estimated budget, but it is also assured of an effective, high quality execution."

The primary element within the scope of work for this contract is to widen and deepen the existing navigational channel by dredging approximately 4.6 million cubic meters in the northern most reaches of the Lake. This contract is one component within the ACP's Fresh Water Dredging and Excavation Project for the Canal Expansion, which includes the dredging and/or excavation of about 30 million cubic meters in Gatun Lake and the Gaillard Cut (the narrowest stretch of the Panama Canal).

Expansion will build a new lane of traffic along the Panama Canal through the construction of a new set of locks which will double capacity and allow more traffic and longer, wider ships.

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Dry Excavation Will Be Completed Ahead of Schedule

Canal ExpansionThe consortium led by the Spanish construction company Sacyr Vallehermoso - which also includes the Italian company Impregilo, the Belgian company Jan de Nul, and the Panamanian company Cusa - said they would complete the excavation work they have been contracted to do in early 2012, one year ahead of schedule. Despite the acceleration in the excavation phase of the project, the entire project will only be completed a few weeks prior to the date stipulated in the contract, 21 October 2014, so that the inauguration coincides with the 100th anniversary of the commissioning of the original Panama Canal, on 15 August 2014. The good pace of work being maintained on the part of the project to construct the third set of locks is the most news in this project whose main difficulty is not from bad weather, as one might expect in a country where the rainy season lasts from eight to nine months. In fact, calculations by contractors led by Sacyr predict work will be slowed by some 50% but only during days of the most intense rainfall.

"The paperwork, that's the main problem we have encountered so far," said the director of the Grupo Unidos Por El Canal (GUPC), Antonio Zaffaroni, referring to the immense bureaucracy the consortium has to face day to day. Of the $3.198 billion dollars ($2.665 billion Euros) that the consortium will earn for building their part of the project, they have already received an advance of $300 million dollars ($250 million Euros) which was spent on the acquisition of machinery to start work. They will soon receive a second advance, of the three agreed to in the contract, of $100 million dollars (83 million Euros), for the acquisition of electromechanical equipment, while for work accomplished they have only charged $30 million dollars (25 million Euros). The budget for the project is closed, but the consortium could earn up to a maximum of 50 million dollars (42 million euros) paid at a rate of $215,000 per day, if they deliver the project ahead of schedule. However, the penalty is higher if the delivery is delayed - they will have to pay a fine of $300,000 per day up to a total of $54.6 million dollars.

So far, the group expects to be able to remove about 40 million cubic meters of earth, and they now think they will be able to do that in about two years as compared to the three originally planned, allowing for less overlap with the concrete pouring stage, which is more complicated that will take nearly two years. In parallel with the excavations, which began in February this year, they are building ancillary facilities that include an aggregate crushing plant to make concrete, which will be produced in another plant. The aggregates will come from the excavated rock on the Pacific side, because the rocks on the Atlantic side are sandy and are no good for this purpose, and right now the contract to deliver cement still has not been signed, although they are negotiating with both Cemex and Cemento Panama.

The two new systems of locks, which constitute the third set of locks for the Panama Canal, will be built on both the Atlantic and Pacific sides, and will have three chambers each, separated by four blocks of two huge gates each. The expansion, which during the peak of the project will employ about 8,000 construction workers, 90% of that labor local, will allow for the passage of vessels of greater size and depth, while the faster filling and emptying of the chambers will facilitate passage of up to 28 ships per day.

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Belgian Company Lowest Bidder To Dredge Gatun Lake Channel

Canal Expansion The Belgian consortium Dredging International presented the lowest bid yesterday for the contract to dredge a part of Gatun Lake, which supplies water to the Panama Canal, as part of the program to expand the waterway, according to an official source. The consortium made a bid of $39.9 million dollars, beating another Belgian company Jan De Nul ($57.8 million), the China Harbour Engineering Company ($67.3 million) and from the Netherlands Boskalis International ($85.5 million), from the US the Great Lakes Dredge & Dock ($72.3 million) and from the Netherlands Van Oord ($97.9 million). The Vice President of Projects for the Panama Canal Authority (ACP), Jorge L. Quijano, told reporters they would begin a technical and financial analysis of the proposals, as well as the requirements stated in the tender specifications, before finally awarding the contract set by the lowest bidder. "The project to dredge Gatun Lake is vital to ensure the passage of huge vessels to the new locks on the Atlantic, so we expect to award the contract to the winning firm within the next few weeks," he said. The main element in the scope of work for this contract consists of widening and deepening the existing navigation channel through the dredging of approximately 4.6 million cubic meters along the edges of the existing channel, in the extreme Northern end of the lake. This will allow for the passage of larger vessels, such as post-Panamax, through the Gatun locks as well as the new larger locks that are being built. The Canal expansion program, which ends in 2014, with an estimated cost of $5.25 billion dollars, will increase the annual capacity of the Panama Canal from 300 million tons to 600 million tons of cargo per year. (Telemetro)
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Panama partners with Jacksonville

Canal Expansion The Panama Canal Authority (ACP) and Jacksonville Port Authority have launched a strategic partnership with the signing of a Memorandum of Understanding (MoU). As part of the MOU, ACP and Jacksonville will conduct a series of joint activities. Specific areas of focus include marketing, research and data interchange, technical advancements and personnel training programs. The port’s connection with the Panama Canal at present stands at more than 600 annual calls. The port said it regarded the opening of the new locks as the beginning of a profound transformation in US cargo patterns, and said it will be ready for the completion of the new locks and a dramatic increase of canal cargo volume. (portstrategy.com)

Editor's Comment: Everyone from the Gulf of Mexico to the Eastern Seaboard of the United States is getting "twitchy" over the implications of the impending expansion of the Panama Canal. Traditionally, most cargo from Asia came into West coast ports on huge container ships, and then was moved via rail and truck into the middle of the country. Only smaller container ships that could pass through the Panama Canal would call on ports such as Houston, Tampa, and Jacksonville. As this article indicates, the expansion of the Panama Canal will create a "profound transformation in US cargo patterns" and everyone is maneuvering to try to position themselves to be in the best position to take advantage of the newly emerging paradigm. Last week I got a telephone call from a guy who ships tons of cotton from Texas every year, and they were lobbying to have Houston established as one of five collection points for overseas shipping, due to the impending expansion of the Panama Canal. From a strategic point of view, West Coast ports will see less traffic and Gulf and East coast ports will see more. The shippers will figure out the most efficient and least expensive routes, and use those. And of course all of this is great news for Panama, because all that new traffic will paying tolls here. Ka-ching! In the photo - the Emma Maersk - the largest container ship in the world, capable of carrying 15,200 "twenty foot equivalent units" or TEU's. This ship can carry more than three times as much cargo as the current "Panamax" ships - and it will be able to pass through the newly expanded Panama Canal after August 2014. Now, the ports in the Gulf and on the Eastern seaboard are scrambling to dredge their access channels, upgrade port facilities, install new cranes, etc.

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