Front Cover
 Front Matter
 Table of Contents
 The Atlantic-Pacific interoceanic...
 Isthmian Canal interests of the...
 Potential canal traffic and...
 Excavation by nuclear methods
 General criteria
 Environmental considerations
 Analysis of alternatives
 Financial feasibility
 Management of sea-level canal construction...
 Conclusions and recommendation...
 Enclosure 1: Commission authorizing...
 Enclosure 2: Report by the technical...
 Enclosure 3: Atomic energy commission...
 Annex I: Study of foreign policy...
 Annex II: Study of national defense...
 Annex III: Study of canal...
 Annex IV: Study of interoceanic...
 Annex V: Study of engineering...
 Back Cover


Interoceanic canal studies, 1970
Full Citation
Permanent Link: http://ufdc.ufl.edu/AA00006086/00001
 Material Information
Title: Interoceanic canal studies, 1970
Physical Description: 1024 p. (various pagings) : illus., maps (part col.) ; 28 cm.
Language: English
Creator: United States -- Atlantic-Pacific Interoceanic Canal Study Commission
United States -- Army. -- Corps of Engineers. -- Jacksonville District
Publisher: Govt. Printing Office
Place of Publication: Washington, DC
Publication Date: 1971
Subjects / Keywords: Canals, Interoceanic   ( lcsh )
Genre: federal government publication   ( marcgt )
bibliography   ( marcgt )
letter   ( marcgt )
Bibliography: Includes bibliographical references.
General Note: Includes Annexes 1-5.
 Record Information
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 00143341
lccn - 78611485
sobekcm - AA00006086_00001
Classification: lcc - TC773 .U23
ddc - 627/.13/09728
System ID: AA00006086:00001

Table of Contents
    Front Cover
        Front Cover 1
        Front Cover 2
    Front Matter
        Front Matter 1
        Front Matter 2
    Table of Contents
        Page i
        Page ii
        Page iii
        Page iv
    The Atlantic-Pacific interoceanic canal study commission
        Page v
        Page vi
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
    Isthmian Canal interests of the United States and other nations
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
    Potential canal traffic and revenues
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
        Page 31
        Page 32
    Excavation by nuclear methods
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Page 40
        Page 41
        Page 42
        Page 43
        Page 44
        Page 45
        Page 46
    General criteria
        Page 47
        Page 48
        Page 49
        Page 50
        Page 51
        Page 52
        Page 53
        Page 54
        Page 55
        Page 56
        Page 57
        Page 58
    Environmental considerations
        Page 59
        Page 60
        Page 61
        Page 62
    Analysis of alternatives
        Page 63
        Page 64
        Page 65
        Page 66
        Page 67
        Page 68
        Page 69
        Page 70
        Page 71
        Page 72
        Page 73
        Page 74
        Page 75
        Page 76
        Page 77
        Page 78
        Page 79
        Page 80
        Page 81
        Page 82
        Page 83
        Page 84
        Page 85
        Page 86
        Page 87
        Page 88
    Financial feasibility
        Page 89
        Page 90
        Page 91
        Page 92
        Page 93
        Page 94
        Page 95
        Page 96
        Page 97
        Page 98
        Page 99
        Page 100
    Management of sea-level canal construction and operation
        Page 101
        Page 102
        Page 103
        Page 104
    Conclusions and recommendations
        Page 105
        Page 106
        Page 107
        Page 108
        Page 109
        Page 110
    Enclosure 1: Commission authorizing legislation
        Page 111
        Page 112
        Page 113
        Page 114
    Enclosure 2: Report by the technical associates for geology, slope stability, and foundations
        Page 115
        Page 116
        Page 117
        Page 118
        Page 119
        Page 120
        Page 121
        Page 122
        Page 123
        Page 124
    Enclosure 3: Atomic energy commission views on development of nuclear excavation technology
        Page 125
        Page 126
        Page 127
        Page 128
        Page 129
        Page 130
    Annex I: Study of foreign policy considerations
        Page Annex 1-a
        Page Annex 1-b
        Page Annex 1-i
        Page Annex 1-ii
        Page Annex 1-iii
        Page Annex 1-iv
        Page Annex 1-1
        Page Annex 1-2
        Page Annex 1-3
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    Annex II: Study of national defense aspects
        Page Annex 2-a
        Page Annex 2-b
        Page Annex 2-i
        Page Annex 2-ii
        Page Annex 2-iii
        Page Annex 2-iv
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        Page Annex 2-vi
        Page Annex 2-1
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    Annex III: Study of canal finance
        Page Annex 3-a
        Page Annex 3-b
        Page Annex 3-i
        Page Annex 3-ii
        Page Annex 3-iii
        Page Annex 3-iv
        Page Annex 3-v
        Page Annex 3-vi
        Page Annex 3-1
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        Page Annex 3-50
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        Page Annex 3-53
        Page Annex 3-54
        Page Annex 3-55
        Page Annex 3-56
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    Annex IV: Study of interoceanic and intercoastal shipping
        Page Annex 4-a
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        Page Annex 4-i
        Page Annex 4-ii
        Page Annex 4-iii
        Page Annex 4-iv
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        Page Annex 4-ix
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        Page Annex 4-xiv
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    Annex V: Study of engineering feasibility
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    Back Cover
        Back Cover 1
        Back Cover 2
Full Text


Stu-dy Commis
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A, :. 3 ..
9 9 .V"'.-

Digitized by the Internet Archive
in 2011 with funding from
University of Florida, George A. Smathers Libraries with support from LYRASIS and the Sloan Foundation



December 1, 1970

The President
The White House
Washington, D. C.

Dear Mr. President:

We have the honor to submit herewith the final report of the Atlantic-
Pacific Interoceanic Canal Study Commission as required by Public Law
88-609, 88th Congress, as amended.

One provision of the law required us to determine the practicability
of nuclear canal excavation. Unfortunately, neither the technical
feasibility nor the international acceptability of such an application of
nuclear excavation technology has been established at this date. It is not
possible to foresee the future progress of the technology or to determine
when international agreements can be effectuated that would permit its use
in the construction of an interoceanic canal. Hence, although we are
confident that someday nuclear explosions will be used in a wide variety
of massive earth-moving projects, no current decision on United States
canal policy should be made in the expectation that nuclear excavation
technology will be available for canal construction.

The construction of a sea-level canal by conventional means is
physically feasible. The most suitable site for such a canal is on Route 10
in the Republic of Panama. Its construction cost would be approximately
$2.88 billion at 1970 price levels. Amortization of this cost from toll
revenues may or may not be possible, depending on the growth in traffic,
the time when the canal becomes operative, the interest rate on the
indebtedness, and payments to the host country. We believe that the
potential national defense and foreign policy benefits to the United States
justify acceptance of a substantial financial risk.

As a first step, we urge that the United States negotiate with Panama
a treaty that provides for a unified canal system, comprising both the
existing canal and a sea-level canal on Route 10, to be operated and
defended under the effective control of the United States with participation
by Panama.

If suitable treaty arrangements are negotiated and ratified and if the
requisite funds can then be made available, we recommend that construction

of a sea-level canal be initiated on Route 10 no later than 15 years in
advance of the probable date when traffic through the present canal will
reach its transit capacity. Current trends indicate that this will be near
the end of this century; the specific year can be projected with increasing
confidence as it draws nearer.

We recognize, however, that the President of the United States and
the Congress will continue to face many serious funding problems and
must establish the relative priorities of the requirements for defense,
welfare, pollution, civil rights, crime, and other problems in social
undertakings then existing.

We specifically recommend that, when the rights and obligations
of the United States under new treaties with Panama are determined, the
President reevaluate the need and desirability for additional canal
capacity in the light of canal traffic and other developments subsequent
to 1970, and take such further steps in planning the construction of a
sea-level canal on Route 10 as are then deemed appropriate.


Robert G. Storey \ Milton S. Eisenhower

Kenneth E. Fields Raymond A. Hill

Robert B. Anderson, Chairman



Chapter INTRODUCTION ...........................................

STATES AND OTHER NATIONS ....................................


Chapter IV EXCAVATION BY NUCLEAR METHODS ......................

Chapter V GENERAL CRITERIA .......................................

Chapter VI ENVIRONMENTAL CONSIDERATIONS .......................

Chapter VII -ANALYSIS OF ALTERNATIVES .......... ....................

Chapter VIII FINANCIAL FEASIBILITY ...............................

STRUCTION AND OPERATION .................................. .

Chapter X CONCLUSIONS AND RECOMMENDATIONS ....................

Enclosure 1 Commission Authorizing Legislation .........................
Enclosure 2 Report by the Technical Associates for Geology,
Slope Stability, and Foundations .....................................
Enclosure 3 Atomic Energy Commission Views on Develop-
ment of Nuclear Excavation Technology ................................




List of Tables

Table Page

1 Canal Routes Selected for Commission Investigation ....................... 5
2 Panama Canal Users, Fiscal Year 1969 .................................. 15
3 Commercial Ocean Transits of an Isthmian Canal
Relative to Commercial Ocean Cargo in Year ........................... 20
4 Growth of Panama Canal Traffic ....................................... 22
5 Influence of Japan Trade ............................................. 22
6 Cargo Tonnage Forecasts for an Unrestricted
Isthm ian Canal .................................................. 23
7 Average DWT Projections ............................................ 25
8 Projected Sea-Level Canal Transits ..................................... 26
9 Estimated Sea-Level Canal Revenue Relative to
Total Cargo Tonnage .............................................. 29
10 Forecasts of Sea-Level Canal Revenues .................................. 29
11 Forecast Proportions of Super Ships in the World Fleet ..................... 47
12 Maximum Numbers of Ships in Convoys with Tidal
Checks in U se ................................................... 52
13 Single-Lane Channel Dimensions for Safe Navigation
of 150,000 DWT Ships ............................................ 53
14 Recommended Side Slopes of Excavations for
Different Materials and Heights ..................................... 57
15 Route 15 Data Estimates ............................................. 77
16 Route 14S Data Estim ates ............................................ 81
17 Route 10 Data Estimates ............................................. 85
18 Forecasts of Sea-Level Canal Revenues .................................. 89
19 Average Toll Revenues Per Long Ton of Cargo Required for
Amortization of Capital Cost in 60 Years .............................. 93
20 Estimated Peak Debt at 6 Per Cent for Construction
of Sea-Level Canal on Route 10 Operated in
Conjunction with the Panama Canal .................................. 98

List of Figures

1 Canal R outes ..................................................... vi
2 Interoceanic Canal Routes (1947 Study) ................................ 3
3 Culebra Cut Excavation, June 1913 .................................... 8
4 United States Navy Aircraft Carrier, CONSTELLATION ................... 10
5 Canal Zone Town of Balboa ......................................... 13
6 Comparison of Previous Panama Canal Traffic Forecasts and
Panama Canal Actual Total Cargo Tonnage Experience ................... 18

List of Figures (Cont'd)

Figure Page

7 Projected Panama Canal Commercial and Bypass
Traffic, Long Tons of Cargo (Economic Research
Associates) ................................................... 19
8 Cargo Tonnage Forecasts for a Non-Restricted
Isthmian Canal ................................................. 24
9 Isthmian Canal Transits Based on Potential
Tonnage Forecast .............................................. 27
10 SEDAN Crater .................................................... 34
11 BUGGY I Crater .................................................. 35
12 Helicopter Lifting a Drilling Mast on Route 17 ........................... 36
13 Route 17 Centerline Trail ........................................... 38
14 Base Camp, Route 17 .............................................. 39
15 Drilling for Subsurface Geological Data ................................. 41
16 Experimental Channel, Fort Peck, Montana ............................. 42
17 Seven Day Tide Record ............................................. 49
18 Tugs Assisting Ship in the Panama Canal ............................... 50
19 Scale Model Test, Naval Ship Research and
Developm ent Center ............................................. 51
20 Artist's Sketch of Tidal Check ..................................... ... 52
21 Tidal Check Operation, Single-Lane Canal ............................... 54
22 Tidal Check Operation, Canal with Center Bypass ......................... 55
23 Earth Slide in the Gaillard Cut, October 1915 ............................ 58
24 The Canal Zone ................................................... 64
25 Gatun Locks at the Caribbean end of the Panama Canal .................... 65
26 Widening the Panama Canal Channel ................................... 65
27 M iraflores Locks ........... ........... ............................ 66
28 The Panama Canal at Night .......................................... 66
29 Lock Canal Route 5, Sea-Level Canal Route 8 ........................... 68
30 Sea-Level Canal Routes 17, 23, and 25 ................................. 69
31 Line Camp where Route 17 Crosses the Continental
D ivide ........................................................ 70
32 Sea-Level Canal Route 25 ........................................... 71
33 Rio Sucio on the Atrato River ........................................ 72
34 Route 25 Channel Configurations .................................... 73
35 Alto Curiche Weather Station, Route 25 ................................ 74
36 Deep Draft Lock Canal ............................................. 76
37 Sea-Level Canal Route 14 ........................................... 79
38 Route 14S Channel Configurations .................................... 80
39 Sea-Level Canal Route 10 ........................................... 83
40 Route 10 Channel Configurations ..................................... 84
41 Farmland on Southern Portion of Route 10 ............................. 87

List of Figures (Cont'd)

Figure Page

42a Tolls Versus Opening Dates, Potential Tonnage
Projection ..................................................... 95
42b Tolls Versus Opening Dates, Low Tonnage
Projection ....................................... ....... ...... 95
43a Sensitivity of Tolls to Project Cost, Potential
Tonnage Projection .............................................. 96
43b Sensitivity of Tolls to Project Cost, Low Tonnage
Projection ..................................................... 97
44 Average Tolls Required for Amortization of a
Route 10 Canal ................................................. 100


Raymond A.

Robert G.
Vice Chm.

Robert B.

Milton S.

Kenneth E.


Executive Director John P. Sheffey

Engineering Agents Brigadier General Harry G. Woodbury, U.S. Army
(June 24, 1965 to June 18, 1967)

Brigadier General Charles C. Noble, U.S. Army
(June 19, 1967 to January 26, 1969)

Brigadier General Richard H. Groves, U.S. Army
(January 27, 1969 to the present)

Secretary Edward W. McGregor

e i

8 -










The Atlantic-Pacific Interoceanic Canal Study Commission was required by Public Law
88-609 of the 88th Congress, September 22, 1964, (Enclosure 1) ". .. to make a full and
complete investigation and study, including necessary on-site surveys, and considering
national defense, foreign relations, intercoastal shipping, interoceanic shipping, and such
other matters as they may determine to be important, for the purpose of determining the
feasibility of, and the most suitable site for, the construction of a sea-level canal connecting
the Atlantic and Pacific Oceans; the best means of constructing such a canal, whether by
conventional or nuclear excavation, and the estimated cost thereof." The Commission
interpreted its mission also to require, for the purpose of comparison, an evaluation of the
merits of improving and augmenting the existing Panama Canal to accommodate forecast
On December 18, 1964, President Lyndon B. Johnson announced the willingness of the
United States to negotiate with the Republic of Panama a new treaty to replace the Treaty
of 1903. At the same time he stated that the United States would request rights to conduct
on-site investigations of potential sea-level canal routes not only in Panama but also in
Colombia, Nicaragua, and Costa Rica. The President said:

"For fiftyyears the Panama Canal has carried ships of all nations in peaceful
trade between the two great oceans on terms of entire equality and at no profit
to this country. The Canal has also served the cause of peace and freedom in two
world wars. It has brought great economic contributions to Panama. For the rest
of its life the Canal will continue to serve trade, and peace, and the people of
But that life is now limited. The Canal is growing old, and so are the Treaties
for its management, which go back to 1903.
So I think it is time to plan in earnest for a sea-level canal. Such a canal will be
more modern, more economical, and will be far easier to defend. It will be free of
complex, costly, vulnerable locks and sea-ways. It will serve the future as the
Panama Canal we know has served the past and the present."
When President Richard M. Nixon took office in January 1969, he retained the
originally appointed Commission and requested it to continue the investigation to its
The Commission has been guided in its investigation by numerous earlier canal studies.
The most recent of these were:
The 1947 study conducted by the Governor of the Panama Canal.
The 1960 study by the House Committee on Merchant Marine and Fisheries.

The 1960 and 1964 studies by the Panama Canal Company.
These earlier studies evaluated all potential canal routes across Central America and thus
enabled the Commission to concentrate its efforts on the most promising ones.

Canal Treaties
The Commission has had no role in the treaty negotiations with Panama conducted by
its Chairman, Robert B. Anderson, in his separate capacity as Special Representative of the
United States for United States-Panama Relations.
The Commission assumed at the outset of its studies that construction of any sea-level
canal would require new treaty arrangements between the United States and the host
country. Existing treaties with Panama and Nicaragua do not provide authority for
construction of a sea-level canal in either country, and no existing treaties provide the
United States canal rights in Costa Rica or Colombia. In addition, no treaty in force
provides for multinational participation in canal finance or management.
During the first 2 years of the Commission's investigation, treaty negotiations with
the Republic of Panama were in progress. In June 1967, the negotiators reached agreement
on drafts of three new treaties to replace the Treaty of 1903 one for the continued
operation of the existing canal, another for United States rights to build and operate a
sea-level canal in Panama, and a third for canal defense. However, neither Government
initiated ratification procedures thereafter, and in 1970 the Government of Panama
announced its rejection of the draft treaties. In both countries new administrations have
replaced those in office when the draft treaties were developed. The drafts have no legal
status; they represent only the United States and Panamanian negotiators' judgments in
1967 of what might have been acceptable to their respective Governments at that time.
However, the Commission has been mindful of relevant provisions of the draft treaties in its
consideration of possible future treaty arrangements that would bear upon the feasibility of
a sea-level canal in Panama.

Selection of Alternatives for Evaluation
In October 1962, the Secretary of the Army formed a Technical Steering Committee to
review prior studies and to develop a new canal study plan for presentation to the Congress.
The sea-level canal routes recommended in this plan were selected from those found most
promising in the 1947 study conducted by the Governor of the Panama Canal which
identified 30 potential routes and assigned them numbers that have been used in all
subsequent studies (Figure 2). Those recommended for investigation in the plan proposed to
the Congress by the Secretary of the Army, with consideration of the potential of nuclear
excavation, were
Route 8 in Nicaragua and Costa Rica for a sea-level canal constructed primarily by
nuclear excavation.
Route 14 in the Canal Zone for conversion of the present lock canal to sea level by
conventional construction methods.
Route 17 in Panama for a sea-level canal constructed primarily by nuclear
Route 25 in Colombia for a sea-level canal constructed by a combination of nuclear
and conventional excavation methods.

15*00, \




-10o00, 8 COSTA SEE INSERT "A"
RICA 1 17618

9 PA A 22
85 00' O OF \ -
9500' 9000' -- /

26 27

S/GUA A 8000'
-1500- 50 0 50 100
100 0 100 200


The Congress authorized the new canal study on September 22, 1964. The original
legislation contemplated investigation of these four routes and authorized funds for field
surveys only of Routes 17 and 25. Data available from previous studies were believed to be
adequate for evaluations of Routes 8 and 14.
When the Commission was appointed in April 1965, it requested the Secretary of State,
the Secretary of the Army, and the Chairman of the Atomic Energy Commission to serve as
its Advisory Council. Interdepartmental study groups were then organized to conduct
studies under the Commission's direction as follows:

Study of Foreign Policy Considerations.
Study of National Defense Aspects.
Study of Canal Finance.
Study of Interoceanic and Intercoastal Shipping.
Study of Engineering Feasibility (directed by the Chief of Engineers, United States
Army, in coordination with the Atomic Energy Commission and the Panama Canal
Study of Public Information Requirements
(subsequently combined with the Study of Foreign Policy Considerations).
The study groups included representation from all government agencies with significant
interests in an Isthmian canal. They also used private contract agencies for supporting
technical studies.
The Commission employed a panel of eminent private consultants which it
designated as its Technical Associates for Geology, Slope Stability, and Foundations. These
specialists provided technical advice directly to the Commission on engineering matters and
were also made available to the Commission's Engineering Agent to advise and assist him in
the conduct of the Study of Engineering Feasibility.
At the outset of its studies, the Commission approved investigation of the four routes
recommended to the Congress by the Secretary of the Army. A few months later the
Commission directed its Engineering Agent to update earlier cost estimates for improve-
ments to the existing lock canal and for construction of a new lock canal in Nicaragua; these
estimates were needed to permit comparisons with the alternative sea-level canals in terms of
capacities and construction, operation, and maintenance costs.
As the engineering study of Route 14 progressed it became apparent that an alternate
route nearby, one that did not interfere with the existing canal, might be preferable.
Consequently, in June 1966 Route 10 was added to the routes under consideration. The
Congress subsequently provided additional funds for a limited field investigation of this
As the geological drilling program on Route 17 progressed, it became apparent that there
was little possibility that nuclear means could be used for excavation of approximately
one-third of the route. Hence, the plan for evaluation of this route was revised late in 1967
to provide for excavation of approximately 20 miles of its length by conventional methods.
In 1969 the Government of Colombia informally proposed a joint U.S.-Colombian-
Panamanian investigation of Route 23. The Commission advised Colombian representatives

that the route did not appear to be competitive with routes already under consideration but
agreed to include in its final report an analysis of it based upon available data.
Table 1 lists all the routes given specific consideration in the course of the
Commission's investigation. A detailed discussion of the selection of these routes is
contained in Annex V, Study of Engineering Feasibility.



Type of Canal/
Route No. Route Name Country Excavation Method Basis of Evaluation

5 San Juan del Nicaragua and Lock/Conventional Available data
Norte-Brito Costa Rica
8 San Juan del Nicaragua and Sea-Level/Conventional Available data
Norte-Salinas Bay Costa Rica or Nuclear
10 Chorrera-Lagarto Panama Sea-Level/Conventional Available data augmented by
geological investigations
14- Panama Canal Canal Zone Sea-Level/Conventional Available data augmented by
Combined Sea-Level geological investigations
14- Panama Canal Canal Zone Sea-Level/Conventional Available data augmented by
Separate Sea-Level geological investigations
15 Panama Canal Canal Zone Lock/Conventional Available data
17 Sasardi-Morti Panama Sea-Level/Conventional Comprehensive on-site survey
and Nuclear Combination
23 Atrato-Tuira Colombia and Sea-Level/Conventional Available data augmented by
Panama or partially Nuclear data from surveys on Routes
17 and 25.
25 Atrato-Truando Colombia Sea-Level/Conventional Comprehensive on-site survey
and Nuclear Combination




The United States entered the Isthmus of Panama in 1903 to build a canal to serve
world commerce and contribute significantly to the national security of the United States.
In the years since its opening in August 1914, the Panama Canal has played a major role in
the defense of the United States and its value as an international public utility serving ocean
trade has increased dramatically.
Although less than 5 per cent of canal tonnages in recent years has been United States
intercoastal trade and although most merchant ships now using the Panama Canal are not of
United States registry, approximately 70 per cent of all canal cargoes either originate in or
are destined for the United States. More than 40 per cent of the ocean trade of the Pacific
Coast countries of South America passes through the canal. Japan, Canada, Venezuela, and
Chile are major users, and almost every country in the world has some trade on the canal
The policy of the United States has been to operate the Panama Canal on a non-profit
basis for the benefit of all users. No specific effort has been made to amortize the United
States investment in the canal. With the exception of a few small repayments to the
Treasury, revenues in excess of operating and interest costs have been devoted to capital
The initial investment of $387 million was too great to be amortized by reasonable tolls
during the canal's early years. Tolls were set at 90 cents per measurement ton (100 cubic
feet of cargo space) for laden vessels, 72 cents per measurement ton for vessels in ballast,
and 50 cents per displacement ton for warships and other non-cargo vessels. From
1914 to 1951 the canal was maintained and operated by annual appropriations from the
United States Treasury, while annual receipts were returned to the Treasury. Not until after
World War II did revenues approach operating costs. In 1951 the Panama Canal Company
was organized as a United States Government corporation under legislation which permitted
continuation of the previously established toll levels but authorized increases when needed
to meet operating costs, interest on the unamortized investment, and a proportionate share
of the cost of the Canal Zone Government. In arriving at the interest-bearing debt* of the
Company the Congress set it at a minimum to lessen the interest burden on toll revenues.
All capital costs that reasonably could be attributed to defense or other activities not
required for ship transits were written off. No provision was made for payment of the

*The Panama Canal Company's interest-bearing debt was established in 1951 at $373 million. (See Public Law 841, 81st
Congress, September 26, 1950,64 Stat. 1041; Hearings before the Subcommittee on the Panama Canal of the Committee
on Merchant Marine and Fisheries, House of Representatives, on H.R. 8677, 81st Congress, June 26-28, 1950; Hearing
before the Committee on Armed Services, United States Senate, on H.R. 8677, 81st Congress, September 7, 1950.) As of
June 30, 1970 it had been reduced by write-offs and repayments to $317 million. As of this same date the total
unrecovered United States investment in the canal, including unpaid interest accrued since 1903, was estimated by the
Company to be $700 million, excluding defense costs.

Culebra Cut, the deepest excavation of the Panama Canal, June 1913

interest obligation which had accumulated prior to the creation of the Company, and the
formula prescribed for calculating the interest rate on the debt was designed to keep current
interest payments low. The legislation creating the Company did not permit it to increase
tolls for the purpose of amortizing its debts.
Since 1951 the Congress has continued to confirm its intent to maintain low tolls.
When the canal annuity to Panama was increased $1.5 million by treaty agreement in 1955
the Congress stipulated that the increase be paid through an appropriation to the
Department of State. This arrangement continues today; only $430,000 of the $1,930,000
annuity is included as a cost of canal operation. Hence, meeting the legally established
payment objectives of the Panama Canal Company has not required an increase in the toll
rates set in 1914.

Interests of the United States
The objectives of the United States in an Isthmian canal are:
That it always be available to the world's vessels on an equal basis and at reasonable

That it serve its users efficiently, and
That the United States have unimpaired rights to defend the canal from any threat
and to keep it open in any circumstances, peace or war.

National Security
The present Panama Canal plays an important role in the United States national
defense; this is analyzed in Annex II, Study of National Defense Aspects. In World War II
(1941-1945), United States Government vessels made 20,276 transits, and 24 million tons
of military supplies passed through the canal. During the Korean War (1951-1954), United
States Government vessels made 3,331 transits, and 12 million tons of supplies went
through. It played an important role in the deployment of naval vessels during the Cuban
crisis in 1962, and currently a large portion of the military vessels and military supplies
bound for Vietnam passes through the canal.
Closure of the Panama Canal in wartime would have the same effect on United States
military capabilities as the loss of a large number of ships. Many additional ships would be
needed to support military operations effectively via alternate !routes, particularly
operations in the Pacific area. The canal's major military importance is in the logistic
support of combat forces overseas; internal United States transportation systems and port
complexes could be severely burdened in wartime if cargo movements had to be diverted
from canal routes. In an emergency, combat vessels can be deployed between the oceans by
other routes, but the capacities of available shipping, ports, and domestic transportation
cannot be quickly augmented to compensate for canal closure.
Panama has neither sufficient military strength to defend the Panama Canal nor the
capability of developing such strength. The presence of United States forces is essential for
the security of the canal. This limited role of the United States forces in the Canal Zone has
created no great difficulties with Panama. The defense of the canal, however, is an integral
part of the defense of the Americas; Panamanian Governments in the past have expressed
objections to the planning and execution of hemisphere defense activities from Zone bases.
The existing Panama Canal is vulnerable to many forms of attack, even though
extensive protective measures have been taken to strengthen the dams holding its water
supply, to double-gate the canal locks, and to guard its power sources. Drainage of Gatun
Lake is the greatest danger. A guerrilla raid on the locks or dams or the demolition of a
shipload of explosives in the locks could result in the loss of stored water that could take as
long as 2 years to replace. Shorter term interruptions could readily be created by sabotage
of power supplies and lock machinery, by scuttling ships in the locks or channel, or by
harassment by fire on ships in transit. Considering its vulnerabilities, little comfort can be
drawn from the fact that no interruption of canal operations by hostile forces has occurred,
for no military or guerrilla attack on the canal has yet been attempted. The United States
must have a secure Isthmian canal, and its defense can best be accomplished in conjunction
with defense of the surrounding area at great distances from the canal itself.
Although it could not be put in operation for many years to come, a sea-level canal
across the American Isthmus would increase the security of the United States and other
countries in the Western Hemisphere. It would be much less vulnerable to interruptions and
hence easier to defend. The current weaknesses of locks and power and water supply would

The United States Navy Aircraft Carrier CONSTELLATION passing under the Thatcher Ferry Bridge over the Panama
Canal. This carrier, with a 250-foot wide flight deck, is too wide to pass through the 110-foot wide locks of the present

not exist. Blockages by scuttled ships or bomb-induced slides could be removed relatively
quickly and the possibility is remote that it could be closed for long periods by hostile

Canal Treaties
The principal treaties bearing upon United States canal rights and obligations on the
American Isthmus are:
The Gadsden Treaty of 1853 with Mexico which guaranteed to the United States
freedom of transit across the Isthmus of Tehuantepec should any means of transit
be constructed there.
The Hay-Pauncefote Treaty of 1901 with Great Britain which cancelled an earlier
agreement with Britain that the United States would not fortify any canal across
the Isthmus and provided that the United States could alone build, operate, and
protect the Isthmian canal, provided it was neutral and open to the world's vessels
on an equal basis.
The Hay-Herran Treaty of 1903 with Colombia (never ratified) which would have
given the United States the right to construct a canal in the Province of Panama.
Failure of the Colombian Government to ratify this treaty led to the creation of

the Republic of Panama, and signature of the Hay-Bunau Varilla Treaty of 1903
with Panama.
The Hay-Bunau Varilla Treaty of 1903 with Panama which gave the United States
in perpetuity the exclusive right to build and operate a canal across Panamanian
territory and all the rights as if sovereign in the Canal Zone.
The Bryan-Chamorro Treaty of 1914 with Nicaragua (now in process of being
abrogated) which gave the United States the right in perpetuity to construct an
interoceanic canal across Nicaraguan territory.
The Thompson-Urrutia Treaty of 1914 (ratified in 1922) with Colombia which
gave to Colombia the right of toll-free passage of the Panama Canal for her
government-owned vessels.
The 1936 and 1955 treaties with Panama which relinquished some United States
rights acquired in 1903 and provided additional benefits for Panama but did not
fundamentally change the 1903 Treaty relationship.

Treaty Negotiations, 1964-1967
The draft three-treaty package developed by United States and Panamanian negotiators
between 1964 and 1967, never signed or ratified, and rejected by the Government of
Panama in 1970, contained these major provisions:
The first of the proposed treaties, that for the continued operation of the present
canal, would have abrogated the Treaty of 1903 and provided for: (a) recognition
of Panamanian sovereignty and the sharing of jurisdiction in the canal area, '(b)
operation of the canal by a joint authority consisting of five United States citizens
and four Panamanian citizens, (c) royalty payments to Panama rising from 17 cents
to 22 cents per long ton of cargo through the canal, and (d) exclusive possession of
the canal by Panama in 1999 if no new canal were constructed or shortly after the
opening date of a sea-level canal, but no later than 2009, if one were built.
The second, for a sea-level canal, would have granted the United States an option
for 20 years after ratification to start constructing a sea-level canal in Panama, 15
more years for its construction, and United States majority membership in the
controlling authority for 60 years after the opening date or until 2067, whichever
was earlier. It would have required additional agreements on the location, method
of construction, and financial arrangements for a sea-level canal, these matters to be
negotiated when the United States decided to execute its option.
The third, for the United States military bases in Panama, would have provided for
their continued use by United States forces 5 years beyond the termination date of
the proposed treaty for the continued operation of the existing canal. If the United
States constructed a sea-level canal in Panama, the base rights treaty would have
been extended for the duration of the treaty for the new canal.

Interests of the Canal-Site Countries

The Treaty of 1903 with Panama for the construction and operation of the Panama
Canal granted to the United States in perpetuity all of the rights as if sovereign in a 10-mile-

wide zone across the Isthmus, to the entire exclusion of the exercise of such rights by the
Republic of Panama. The Republic of Panama has sought since 1903 to terminate the
sovereignty and perpetuity clauses of the treaty, to increase her participation in the
employment and financial benefits deriving from the canal, and to reduce both the
substance and the appearance of United States control of Panamanian territory. The treaties
of 1936 and 1955 made limited concessions to Panama, but were short of meeting
Panamanian aspirations.
Panama has indicated in past treaty negotiations that she considers her fundamental
interests in any canal across her territory to be:
That it be operated and defended with full recognition of the sovereignty of the
Government of Panama.
That Panama obtain the maximum possible revenues from the canal in direct
payments and through Panamanian employment and sales of goods and services in
the canal enterprise.
That Panama eventually become sole owner and operator of the canal.
The differing canal objectives of the United States and Panama have continued to
impair tranquil relations. Destructive riots took place along the Canal Zone border in 1959
and in 1964. New treaty negotiations, begun in 1964 and as yet unfinished, have as their
goal the reconciliation of the interests of both countries in a lasting agreement.
There are many constraints upon the United States in meeting Panamanian aspirations,
but the United States has demonstrated, in the treaties of 1936 and 1955 and in negotiating
the 1967 draft treaties, a sincere desire to go as far as it can without jeopardy to its own
canal objectives.
The existing lock canal requires a large staff of skilled operating personnel, and its
defense requires substantial military forces. The Canal Zone provides a United States
standard of living for the 4,000 United States citizen employees of the canal, mostly
executives and skilled craftsmen. The Zone military bases provide similar living standards for
13,500 military and civilian personnel. These canal and military personnel are accompanied
by approximately 20,500 dependents. This results in some 38,000 United States citizens
living in an enclave extending across the middle of the Republic of Panama.
The living conditions provided by the Canal Zone were needed in the past to attract and
retain skilled employees, but modern Panama's economy could provide housing and
commercial services equivalent to those of the present Canal Zone. Panama's capability of
providing skilled personnel is steadily increasing, and the Panama Canal Company has for
some years maintained training programs for its Panamanian employees. Consequently,
skilled employee positions are increasingly being filled by Panamanian citizens. An
employee phase down in a change over to a sea-level canal would hasten the elimination of
what is now deemed by Panamanians to be discrimination in favor of United States citizens
in canal employment. These prospects offer means for reducing or eliminating several
politically sensitive elements in the current situation.
The Panama Canal and its associated United States military bases provide a major
portion of the economic lifeblood of Panama. Although Panama's direct annual compensa-
tion is slightly less than $2 million, more than $100 million each year is paid to
Panamanians for goods and services supplied to the Canal Zone. Panama's economy is
growing more rapidly than the economies of other Latin American countries. Canal

operations and defense are expected to continue to be the basis for about two-thirds of her
foreign exchange earnings and one-third of her total economic activity, at least during the
remainder of this century.
A United States decision to construct a sea-level canal in another country would be an
economic catastrophe for Panama. The potential effects are analyzed in Chapter VII,
Analysis of Alternatives.

The economy of Colombia is larger and more broadly based than that of Panama.
Colombia's population is more than 10 times greater, and her metropolitan centers are far
removed from Route 25. A sea-level canal constructed in Colombia would be, at least
initially, remote from public view and its economic impact would be favorable, although
relatively small.
Formal negotiations for sea-level canal treaty arrangements with Colombia have not
taken place. Informal discussions by members of the Commission with her representatives
and public statements by her officials indicate that a treaty giving the United States
effective control of a canal on Colombian territory might be unobtainable in the foreseeable
future, and that United States military forces for canal defense could not be stationed in

-J .. .

The Canal Zone town of Balboa at the Pacific end of the canal

Colombia. Colombia's representatives acknowledged that construction of a new canal
wholly on Colombian territory could be destructive to the economy of Panama; hence, they
indicated that any canal arrangement involving Colombia would have to contribute to
regional cooperation and not be a source of friction with her neighbors. The Government of
Colombia did express willingness to cooperate with the United States and Panama in
investigating the feasibility of multilateral finance, control, and defense of a canal on Route
23 traversing the territories of both Panama and Colombia.

Nicaragua-Costa Rica
United States relations with Nicaragua and Costa Rica have traditionally been friendly.
The Bryan-Chamorro Treaty of 1914 established United States rights to build a canal in
Nicaragua, subject to further agreement upon detailed terms for its construction and
operation. Plans for abrogation of this treaty were initiated early in 1970, but new treaty
terms attractive to the United States probably would be attainable for a sea-level canal on
Route 8, generally along the border between Nicaragua and Costa Rica.

Interests of Canal Users
As previously indicated, the present Panama Canal plays an important role in the
economic life of some dozen nations and is used in lesser degrees by most other nations of
the world. Although the United States is the largest user of the Panama Canal, its economic
importance is greater to several smaller countries, particularly those of the Pacific Coast of
South America. Table 2 compares the exports and imports through the canal for various
countries in relation to their total ocean trade as a measure of its importance to each. The
United States' 15.8 per cent is exceeded by the proportions of 10 other countries whose
economies are vitally linked with the canal.
A recent informal opinion survey of Panama Canal users by United States embassies
found general satisfaction with operation of the present canal by the United States. The
survey also indicated that the maritime nations of the world assume that the United States
will continue to provide an adequate interoceanic passage.



Long Tons of Commercial Cargo Per Cent of Country's
Country Origin Destination Total Oceanborne Trade

United States
(U.S. I ntercoastal)
United Kingdom
Netherlands West
West Germany
Philippine Islands
New Zealand
South Korea
Canal Zone
El Salvador
South Vietnam
Puerto Rico






(Continued on following page)

'Countries are ranked in accordance with total of origin and destination cargoes in Fiscal
Year 1969. Canal per cent of country's total oceanborne trade is based upon data
contained in the United Nations Statistical Yearbook, 1970.





TABLE 2 (Cont'd)


Long Tons of Commercial Cargo Per Cent of Country's
Country Origin Destination Total Oceanborne Trade
Spain/Portugal 108,216 452,971 0.8
Jamacia 427,746 113,646 4.0
China 343,290 192,271 2.5
Costa Rica 276,139 237,150 30.9
Guatemala 74,396 407,349 30.9
Indonesia 66,578 413,416 1.8
Hong Kong 193,990 230,662 3.7
East Germany 355,160 48,179 4.2
French Oceania 130,498 246,157
Sweden 164,508 195,267 0.5
British Oceania 319,320 38,007
British East Indies 188,277 122,919
Netherlands Guiana 288,765 ---
Honduras 210,642 20,602 13.6
USSR 187,477 32,731 0.2
Thailand 68,656 151,272 1.7
North Korea 57,493 127,350 12.1
Denmark 52,777 128,345 0.6
West Indies
Associated States 134,371 40,023
Norway 103,574 66,836 0.3
Finland 158,050 --- 0.6
Guyana 140,418 --- 2.8
Yugoslavia 11,491 128,840 1.1
Argentina 36,886 56,355 0.5
South Africa ---- 92,317 0.4
Irish Republic --- 75,831 0.7
Haiti and Dominican
Republic 10,004 59,844 1.6
Rumania 62,867 --- 0.9
Israel --- 56,452 0.9
Libya --- 40,278 --
Greece --- 32,423 0.2
Lebanon --- 26,380 0.1
Morocco --- 12,995 0.1
Mozambique --- 10,100 0.1
British Honduras 1,636 -- 0.8
All Others 2,311,328 3,299,726 0.8

TOTAL 101,391,132 101,391,132



Canal traffic forecasts are required to determine (a) when the present canal will become
incapable of meeting estimated demand for transits and (b) whether a new sea-level canal
could be financed from toll revenues. Legislation authorizing a sea-level canal, and the
subsequent detailed planning and construction, would require approximately 15 years, and
60 years or more thereafter might be required for amortization. This period of 75 years into
the future is excessive for economic forecasting; hence, the estimates of potential canal
traffic and revenues described herein of necessity incorporate assumptions and judgments.

Previous Canal Traffic Forecasts
Many forecasts have been made of traffic through the Panama Canal. Figure 6 compares
actual Panama Canal experience with forecasts by Hans Kramer in 1927; Norman Padelford
in 1944; Roland Kramer in 1947; Stanford Research Institute in 1958, 1964 and 1967; and
Gardner Ackley in 1961. These forecasts have almost without exception soon been
exceeded by the traffic which subsequently developed. As the forecast periods became
history, unforeseen new commodity movements appeared in ever-increasing proportions of
the total tonnages passing through the canal.

The Economic Research Associates, Inc., Forecast
The Shipping Study Group, in its report to the Commission, did not estimate future
traffic through the existing canal; it limited its considerations to the potential traffic
through an unrestricted canal. However, early in 1970 a traffic forecast through 1985 for
the present canal was independently developed by Economic Research Associates, Inc.
(ERA) under a contract with the Panama Canal Company (Figure 7). It arrived at a
projection of potential canal traffic essentially the same for the 1970-1985 period as in the
Commission's forecasts, described later in this chapter, produced by a different method-
ology. ERA also forecast the division of potential traffic between the present canal and
alternate routes. As will be shown later in this Chapter, the ERA forecast provides a logical
basis for estimating the saturation date of the present canal if no sea-level canal is built.*

Capacity of the Present Canal
The average amount of commercial cargo per ship transiting the Panama Canal increased
slowly from approximately 4,000 to 5,500 long tons from 1920 to 1960. During the past ten
years, however, there was a rapid increase: 6,470 long tons per transit in 1965; 7,710 long
tons per transit in 1969; and 8,366 long tons per transit in 1970. The average amount of
cargo per ship passing through the Panama Canal in future years will certainly not lessen; it

*Saturation date is the year in which the number of transits through the canal reaches the maximum number that can be
passed through the locks, estimated to be 26,800 per year.

Ip D
1:I ,- I- I-

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le~ Z c W-
oTs LT IL U .

p ow, < z z z
.( Z c| -i c

-<>< 0 0 N S I I

_____RISO OF 2REI aV_ o T A A

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9- -o o Mt

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CIS 000 E 0m
II \ -- ----

0 04

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t; ,%'
- __ -- --- __ -- ----

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09UV j0SN? 9N1 d SNm I







160 **

140 -

120 d. **.... **






1947 1950 1955 1960 1965 1970 1975 1980 1985


Source: Economic Research Associates


should continue to increase as more and more intermediate sized tankers and large bulk
carriers are used to carry crude oil and petroleum products and dry bulk commodities
through the Panama Canal. The indications from this ,10-year trend are that the average will
be 9,500 long tons per ship by the time traffic reaches 150 million long tons of cargo per
year, and at least 12,000 tons per transit when 250 million tons of commercial cargo per
year are carried through the Panama Canal.
The numbers of commercial transits of an interoceanic canal with respect to the
amount of commercial cargo in the future, as variously estimated, are shown in Table 3.



Annual Shipping Study Report'
Cargo Transited 46 Per Cent 25 Per Cent
(Millions Of Tonnages Of Tonnages ERA Historical
of Long Tons) In Freighters In Freighters Report Trend

111 14,700 14,700 13,500 13,500
125 15,800 15,100 14,000 14,400
150 18,300 16,500 16,100 15,900
175 20,500 18,000 --- 17,300
200 22,900 19,300 --- 18,700
225 25,000 20,700 ---- 20,000
250 --- 21,900 --- 21,400
300 -23,600 --- 24,200
350 ---- 25,500 ---

'Annex IV, Study of Interoceanic and Intercoastal Shipping, transit data are related to
forecasts of total potential tonnage, including all categories of traffic that transit the
Panama Canal. This table relates to commercial ocean traffic only.

The Panama Canal Company has determined that 26,800 transits per year of all
classifications could be accommodated by completion of improvements now underway and
by augmentation of the water supply for lock operation. There generally have been less
than 1,500 noncommercial transits per year, although the total did exceed 2,000 in the
years of United States military actions in Asia. The effective transit capacity of the existing
Panama Canal may thus be taken to be 25,000 commercial cargo ships per year. The
corresponding upper limit of capacity of the Panama Canal, expressed in long tons of
commercial cargo per year, has been estimated by the Shipping Study Group to be:
-Forecast assuming 46 percent of tonnages
moving in freighters and an average
of 8,800 tons per transit: 220 million long tons

-Forecast assuming 25 percent of tonnages
moving in freighters and an average
of 12,400 tons per transit: 310 million long tons
If the average size of the ships transiting the Panama Canal continues to increase at the rate
that has prevailed for the past 10 years, the capacity at the saturation level will be at least
300 million long tons per year.
It may be inferred from estimates of probable bypass traffic during the next 15 years
that the demand on the Panama Canal (if it is not superseded) will be approximately 50
million tons less in the year 2000 than the traffic that would pass through an unrestricted
canal. The corresponding demand on the Panama Canal would thus be approximately 300
million long tons in the year 2000 if the potential forecast of the Commission were realized
or 200 million long tons if its low forecast prevails. These estimates are consistent with the
Shipping Study Group analysis of the economics of alternatives of the existing canal (Annex
It is apparent from this analysis of its capacity and the projections of future demand
that the Panama Canal can accommodate the demand for transits by ships of the size that
can pass the existing locks for at least 20 years and more probably to the end of this

Forecast of World Trade Growth
A 1968 study of world oceanborne trade by Litton Systems, Inc. forecast that the
growth of aggregate ocean cargo tonnages would slow from the current 7.2 per cent annual
rate to around 4 per cent by the end of the century and would continue to grow thereafter
at approximately that rate. For the past 20 years the Panama Canal portion of total cargoes
moving in ocean trade each year has been consistent, varying less than one percentage point
above or below 5.1 per cent of the total. A forecast based upon this relationship, using the
Litton forecast of world trade, would justify high expectations for a sea-level canal.
However, a projection of potential canal traffic growth into the future at the exponential
rates of the Litton Study reaches economically questionable levels toward the end of the
century and unrealistic levels thereafter.

The Commission's Forecasts
The traffic growth pattern of the Panama Canal (Figure 6) shows a rapid increase in the
years immediately after its opening in Fiscal Year 1915 followed by a levelling off to
insignificant growth during the depression and war years from 1929 to 1945. Since World
War II, however, there has been sustained growth, and there are no indications of a marked
decline in this growth in the near future. The data are given in detail in Table II-1 of Annex
IV and are summarized in Table 4 of this report. Much of the rapid increase in Panama
Canal traffic in recent years stemmed from trade with Japan, as shown in Table 5.
Two long-range forecasts of traffic through a non-restricted Isthmian canal, made by
the Shipping Study Group, are given in Table 6 and shown graphically in Figure 8. The
forecast of potential canal tonnages recommended to the Commission was in essence a
summation of separate estimates of canal traffic originating in 15 different regions, based in
each case on the historical relationship between such traffic and the respective Gross
Regional Product (GRP) and on extrapolation of that GRP through the year 2000. This



Total Transits Commercial Ocean Transits
Fiscal Cargo Cargo
Year Number Million Tons Number Million Tons

1915 1,108 4.9 1,058 4.9
1920 2,777 9.7 2,393 9.4
1925 5,174 24.2 4,592 24.0
1930 6,875 30.2 6,027 30.0
1935 6,369 25.4 5,180 25.3
1940 6,945 27.5 5,370 27.3
1945 8,866 19.4 1,939 8.6
1950 7,694 30.4 5,448 28.9
1955 9,811 41.5 7,997 40.6
1960 12,147 60.4 10,795 59.3
1965 12,918 78.9 11,834 76.6
1970 15,523 118.9 13,658 114.3


Millions of Long Tons

Total Commercial
Year Cargo in Year Japan Trade Other Cargo

1956 45.1 7.2 37.9
1957 49.7 10.2 39.5
1958 48.1 8.5 39.6
1959 51.2 9.1 42.1
1960 59.3 12.2 47.1
1961 63.7 15.3 48.4
1962 67.5 17.8 49.7
1963 62.2 15.4 46.8
1964 70.6 19.8 50.8
1965 76.6 21.4 55.2
1966 81.7 24.5 57.2
1967 86.2 28.9 57.3
1968 96.5 38.1 58.4
1969 101.4 41.0 60.4
1970 114.3 51.4 62.9



Millions of Long Tons Per Year Including
Allowances for Non-Commercial Traffic

Potential Tonnage Forecast Low Tonnage Forecast
1975 125 141
1980 157 171
1985 194 197
1990 239 218
1995 293 237
2000 357 254
2005 429 272
2010 503 290
2015 577 307
2020 643 325
2025 700 344
2030 743 363
2035 770 383
2040 778 403

forecast was accepted by the Commission for planning purposes. The other forecast was
developed by isolating the traffic to and from Japan from other commercial traffic and then
making separate forecasts for Japan trade and for the remainder of all potential traffic. The
Commission accepted this lower forecast for evaluation of the financial risk that could stem
from construction of a sea-level canal.

Ship Sizes and Potential Canal Transits
The Panama Canal satisfied all demands for shipping between the Atlantic and the
Pacific Oceans from the start of operations in August 1914 until recent years when very
large tankers and bulk carriers began to be built. In 1970 there were approximately 1300
such ships afloat and under construction or on order which could not pass through the
existing locks under any circumstances because of beam width and approximately 1750
others that could not pass through fully laden at all times because of draft limitations. All of
the former and most of the latter are now being used, or will be used, on trade routes that
do not involve the Panama Canal, such as shipments of petroleum from the Middle East to
Europe and iron ore from Australia to Japan. On the other hand, if it were not for the
physical limitations of the Panama Canal, some of these bulk carriers would undoubtedly be
used on canal routes. Distinction must therefore be made between the traffic that the

Potential tonnage

Low tonnage forecast

'/ Panama Canal experience


1i /











Panama Canal will be called upon to handle and the potential traffic that an unrestricted
sea-level canal might attract.
The dimensions of the existing locks of the Panama Canal preclude the passage of ships
larger than 65,000 deadweight tons* (DWT) when fully laden. This size limitation and the
time required for passage of ships through the locks now impose few restraints on free
movement of oceanborne commerce, but both will become progressively more restrictive as
the average size of the ships and the number of transits increase. Few general cargo vessels
are likely to be built that could not pass through the present canal. Approximately 1 per
cent of the bulk carriers now in service are larger than 65,000 DWT, but by the year 2000
about 10 per cent are expected to be. Only 7 per cent of the tankers now afloat cannot
transit the Panama Canal, but it is predicted that within 30 years more than half of the
tankers in the world fleet will be too large to do so. Table 7, developed by the Commission's
Shipping Study Group, lists the projected average sizes of ships that would use a future
Isthmian canal, considering a range of maximum size ships to be accommodated.



Ship Type Ship Size 1970 1980 1990 2000 2020 2040

Freighter All Limits 10,800 11,500 12,200 13,000' 14,600 16,500

Bulker 65,000 27,800 33,900 39,800 44,400 48,800 52,000
100,000 28,000 35,900 43,000 50,000 61,500 69,000
150,000 28,000 36,000 43,700 51,600' 65,800 81,000
200,000 28,000 36,200 44,100 52,000 67,000 84,000
250,000 28,000 36,200 44,100 52,200 67,200 85,000

Tanker 65,000 19,200 27,700 33,000 36,000 37,000 37,000
100,000 20,000 31,800 41,600 49,200 54,300 56,000
150,000 20,100 33,000 44,800 55,000' 66,600 74,600
200,000 20,100 33,300 45,500 56,600 71,000 83,200
250,000 20,100 33,300 46,000 57,500 72,300 87,200

Example: In a canal that could accommodate ships up to 150,000 DWT the average freighter in the year 2000
would be 13,000 DWT; dry bulker, 51,600 DWT; and tanker, 55,000 DWT.

Panama Canal ship mixes and likely variations in canal ship mixes in the future are
discussed in detail in Annex IV, Study of Interoceanic and Intercoastal Shipping. In recent
years, freighters have carried 46 per cent of the cargo tonnage, dry bulkers (some also
carried liquid cargo) 37 per cent, and tankers 17 per cent. It is anticipated that the
proportion of freighter tonnage will diminish progressively as more and more large bulk

*Deadweight tonnage of a ship is its fully laden capacity in long tons (2240 pounds), including cargo, fuel, and stores, but
excluding the weight of the ship itself.

carriers come into use. Since any specific forecast of transits for many years in the future
would have little reliability, transit requirements were calculated for a range of cargo mixes:
a maximum of 46 per cent freighter tonnage; a minimum of 25 per cent of freighter
tonnage. The resulting range of transit possibilities is shown in Table 8. Figure 9 graphically
portrays the range of possible transits for the potential tonnage forecast, used by the
Commission for sea-level canal capacity planning. It is probable that future sea-level canal
transits would remain above the middle range during the remainder of this century and fall
into the lower portion in later years.


(150,000 DWT Maximum Ship Size Capacity)

Potential' Tonnage Forecast Low2 Tonnage Forecast

Year 2000 2020 2040 2000 2020 2040

Tankers 2,252 3,350 3,618 1,602 1,693 1,874

Dry Bulkers 5,652 7,983 7,846 2,565 2,574 2,593

Freighters 16,745 26,854 28,751 21,921 24,975 27,403

Totals 24,649 38,187 40,215 26,088 29,242 31,870

'Assumes most tonnage growth will be in bulk cargoes and current Panama Canal ratio
of 46 per cent of cargo tonnages transiting in freighters will decline to 25 per cent by
2 Assumes uniform growth rate of freighter and bulk cargo tonnages with 46 per cent
of tonnages continuing to transit in freighters through the forecast period.

Estimated Sea-Level Canal Revenues at Current Toll Rates
A canal capable of accommodating large bulk carriers will attract more bulk cargoes
than the present canal. Therefore, revenue estimates must take cognizance of the projected
range of future possibilities: the present Panama Canal cargo mix in which 46 per cent of
tonnages move on freighters, 37 per cent on dry bulk carriers, and 17 per cent on tankers;
and a possible future mix of 25 per cent freighter cargoes, 58 per cent dry bulk cargoes, and
17 per cent tanker cargoes. The average revenue per ton of cargo transited on dry bulk
carriers is the lowest since they usually transit fully laden and have relatively few ballast
transits. The revenue from tankers is higher because of their higher ratio of ballast transits.
The revenue per ton for freighters is highest; they have few ballast transits but usually carry
bulky, light cargoes and are often not fully laden.

I 50

3 40


970 1980 1990 2000 2010 2020 2030 2040




Because the Panama Canal tolls are assessed on the basis of measurement tons (100
cubic feet of cargo capacity), revenues per weight ton of cargo vary widely. The average
revenue per weight ton of cargo passing through the canal during the past 20 years has
fluctuated between 80 and 90 cents per long ton of commercial cargo with a trend toward
the higher amount. Continuation of this upward trend of the average toll per cargo ton
carried through the Panama Canal is indicated by the findings in the recent report of the
Economic Research Associates to the Panama Canal Company. This trend would probably
reverse whenever a sea-level canal became available for use by ships that cannot pass the
locks of the present canal, because of the relatively low revenue per cargo ton realized from
such ships. Therefore, the average toll per long ton of commercial cargo that would be
carried through a sea-level canal can be expected to decrease as the volume of traffic
becomes greater and larger and larger ships come into service. A probable relationship
between such traffic and the average toll is shown in Table 9.
The potential revenues from tolls and toll credits at these average rates per cargo ton are
shown in Table 10 for the traffic forecast recommended by the Shipping Study Group and
for the lower forecast described in the report of that group. It is assumed, as has been
generally true in the past, that the average toll per commercial cargo ton is a fair measure of
toll credits of non-commercial transits.

Maximum Sea-Level Canal Toll Revenues
Three independent studies of potential revenue from the present canal have been made
in recent years. These are the Arthur D. Little Company Study in 1966 for the United
Nations Special Fund, the Stanford Research Institute's Study in 1967 for the Panama
Canal Company, and the Panama Canal Company's 1970 Study in connection with its
evaluation of the Intergovernmental Maritime Consultative Organization's proposed Uni-
versal Measurement Tonnage System.
The Arthur D. Little Study evaluated the movements of major commodities through
the canal in comparison with shipping costs between the same sources and destinations via
alternate routes. The study concluded that, for the short run, an upward revision of the
present tolls could double or triple gross revenues. However, extensive readjustments would
take place over the long run with loss of much of the potential traffic.
The Stanford Research Institute's (SRI) study involved a judgmental determination of
the responses of commodity movements to toll increase by comparing the estimated costs of
alternatives to the canal. It concluded that across-the-board increases up to 25 per cent
would have little effect on traffic, but larger increases would discourage traffic growth. A
100 per cent increase would cause traffic growth to cease entirely and perhaps even cause
traffic to decline. However, the study concluded that the maximum revenues could be
obtained over the long run by selective toll increases on a commodity basis, ranging from 25
per cent to 150 per cent.
The findings of the Panama Canal Company's 1970 Study were generally consistent
with those of the SRI Study. The 1970 Study concluded that maximum toll revenues could
be obtained through selective increases averaging approximately 50 per cent. It was
estimated that this would produce revenues about 40 per cent greater than would be
produced by continuation of the present system.



$0.90 per Laden Panama Canal Ton
$0.72 per Ballast Panama Canal Ton

Millions of Long Toll Revenue
Tons in Year Average Toll Millions of Dollars

200 $0.848 170
300 0.812 244
400 0.777 311
500 0.777 389
600 0.777 466
700 0.777 544
800 0.777 622



$0.90 Per Laden Panama Canal Ton
$0.72 per Ballast Panama Canal Ton

Potential Tonnage Forecast Low Growth Forecast
Fiscal Year $ Millions $ Millions

1990 205 185
2000 290 215
2010 391 235
2020 500 264
2030 577 282
2040 605 313

It is apparent from these studies that it would be necessary to do away with the present
Panama Canal toll structure to realize the maximum potential revenues in an Isthmian canal.
This toll structure, however, which does not discriminate among types of cargo, is
established by law and has the advantages of simplicity of administration, conformity with
systems used in many other canals and ship facilities, and established acceptability to canal
users. Furthermore, this schedule is currently producing revenues adequate to meet

legislatively established obligations of the Panama Canal Company.
The Commission recognizes that United States law requires public hearings before canal
tolls can be increased and that the views of the Congress, canal users, and others would have
to be considered in setting tolls in a sea-level canal. However, in view of the large capital
investment required for a sea-level canal (or for additional locks for the present canal) and
possible future increases in host-country compensation, the Congress may determine that
higher revenue objectives are warranted. The Commission's study of the potential for toll
increases and higher revenues was directed to the practical options available. These are set
forth in detail in Annex IV, Study of Interoceanic and Intercoastal Shipping. In general, it
was found that:

1. The A.D. Little Company, the Stanford Research Institute, and the Panama Canal
Company studies of the lock canal are applicable to an analysis of the revenue
potential of a sea-level canal.
2. The alternatives to the use of any Isthmian canal place an upper limit on the
charges it can impose for its services. These alternatives include:
a. Alternative ship routing to avoid the canal, and alternative ship sizes in
b. Transithmian pipelines for petroleum and dry bulk materials transported in
liquid slurry form;
c. The land bridge concept in which rail movement in the United States and
Canada substitutes for canal routing;
d. Air transport; and
e. Substitute sources and markets.
3. The potential bulk commodity traffic of the sea-level canal is very large, but the
alternatives to the canal limit the ability to increase tolls on these commodities
above present Panama Canal tolls.
4. The tolls on other categories of cargo could be increased on a selective basis in
varying amounts up to 300 per cent without exceeding the cost of available
5. The toll system that would produce the greatest revenue without discouraging
traffic growth is one with rates based upon the value to each user. The direct cost
of rendering the services would determine the minimum level for a tolls charge, and
the cost of the most attractive alternative would determine the maximum charge. If
permitted to use such a pricing structure, a sea-level canal could attract almost all
potential traffic from alternative routes and transportation modes.
The findings of the Shipping Study Group as to the maximum potential revenues of a
sea-level canal may be summarized as follows:
The potential traffic level of a sea-level canal is not likely to be achieved with a new
canal limited to ships of 100,000 DWT or less. It is most likely to be achieved by a
canal with a capacity to transit ships of 200,000 DWT or larger.
Toll rates in a canal of adequate dimensions could be increased an average of 50 per
cent in terms of current dollars by the use of a new system of tolls. This would
cause some loss of potential traffic, but would produce approximately 40 per cent
additional revenue.

- In addition to the potential for increase in current dollars, average tolls could be
increased at a rate approximating the average inflation of the costs of canal
alternatives with little impact on the volume of traffic.
- If tolls are restructured to produce maximum revenues, provisions must be made for
the variations in tolls sensitivities among commodities, ship sizes, and routes.
- A pricing system for structuring tolls designed to meet the costs of competing
alternatives offers the greatest revenue potential for a sea-level canal.




The initial PLOWSHARE cratering experiments and engineering studies conducted from
1958 through 1962, as well as a number of applicable nuclear weapons effects tests,
encouraged the hopes of the scientists and engineers involved that a practical nuclear
excavation technology would soon be forthcoming. An attractive potential application then
considered was the construction of a sea-level Isthmian canal; in 1963-1964 conceptual
studies and research in the new technology were extended to include this objective. Two
Isthmian canal routes, Route 17 in Panama and Route 25 in Columbia, having sparse
populations, remoteness from population centers, and apparently favorable topography,
appeared to meet the requirements of the embryonic technology.
Preliminary engineering estimates, made without on-site investigations, put nuclear
canal construction cost for Route 17 as low as $747 million about one-third the
then estimated cost of conventional construction on Route 14. Route 25 was estimated to
cost more because only a portion was thought suitable for nuclear excavation. However, it
was recognized that the potential economies were contingent upon proof of the feasibility
of nuclear excavation by further research and experimentation and also upon favorable
results of comprehensive physical surveys of the engineering and nuclear safety features of
the selected routes.
There was optimism in 1964 that on-site studies of the routes and the planned program
of additional nuclear cratering experiments would establish the feasibility and desirability of
nuclear excavation, although the magnitude of the technical and political obstacles to
nuclear excavation was recognized by President Johnson's advisers. Further, the United
States was being pressed by Panama to revise the 1903 Treaty. The urgency of determining
the feasibility of a sea-level canal was then deemed to warrant proceeding with on-site route
investigations while carrying out the additional nuclear cratering experiments needed to
develop a practical nuclear excavation technology.
The authorizing legislation requested by the President and approved by the Congress
contemplated extensive data collection on the two most promising nuclear routes, 17 and
25. Only limited field investigations of the routes for conventional excavation were provided
for as the available data were thought to be sufficient for feasibility studies. No field work
was planned for Route 8 inasmuch as evaluations based upon available data showed it to be
less suitable than other routes under consideration. The original authorization for the
planned studies was $17.5 million. This amount was later augmented to $24 million, in part
to expand the investigation of routes suitable for conventional excavation. The actual
expenditure was $22.1 million, of which approximately $17.5 million was devoted to the
nuclear routes, $3.0 million to the conventional routes, and $1.6 million to all other

SEDAN, July 6, 1962, 100 Kiloton The Thermonuclear explosion occurred 635 feet below surface and excavated a
crater about 1200 feet in diameter and about 320 feet deep with a volume of about 6.5 million cubic yards.

Nuclear Excavation Technology
In 1964 knowledge of nuclear cratering physics was limited to single craters in alluvium
and rock. Row crater experiments had been conducted with chemical explosives only.
However, extensive knowledge of the radioactivity, fallout, seismic, and air blast phenomena
associated with nuclear excavation operations was available from a wide variety of nuclear
It had been estimated in prior Isthmian canal studies that the deep cuts through the
Continental Divide sections of the routes would require salvo yields in the tens of megatons
(Mt).* Such levels were considered troublesome, particularly from the ground motions that
might be induced. It was recognized in these studies that radioactivity from fallout could
require extensive evacuation precautions and present problems under the restrictions of the
Limited Test Ban Treaty. There was confidence, however, that the radioactivity effects
could be held to insignificant levels.

*Nuclear explosive equivalent of one million tons of the chemical explosive, trinitrotoluene (TNT).

The BUGGY I crater approximately 860 feet long, 250 feet wide, and 65 feet deep produced by the simultaneous
detonation of five nuclear explosives of approximately 1 kiloton each on March 12, 1968. The explosives were buried 135
feet deep and spaced 150 feet apart in hard rock on the U.S. Atomic Energy Commission's Nevada Test Site. The arrow
points to a pick-up truck.

When the sea-level canal investigation was initiated in 1965, it was expected that
development of the nuclear excavation technology would be advanced sufficiently during
the course of the investigation to permit determination of its feasibility for canal
construction. The AEC's PLOWSHARE program in nuclear excavation was expanded in
order that development of the technology would be phased with the Canal Study
Commission's timetable. A program of some six to eight nuclear tests was considered the
minimum necessary to develop the technology.
Complementary theoretical and laboratory tests and studies were also programmed and
carried out. These related to all aspects of nuclear excavation, including the development of
clean devices and the probable behavior in cratering of the different materials not so far
tested rock, saturated rock, and clay sales as found on the Isthmian routes.
Political and budgetary constraints caused the planned PLOWSHARE nuclear excava-
tion program to move slowly. Although the Canal Study Commission's reporting date was
extended from June 30, 1968 to December 1, 1970, only three tests were carried out during
the Commission's investigation. The data from them materially assisted the complementary
the Commission's investigation. The data from them materially assisted the complementary

*: .... ..

United States Air Force CH-3 Helicopter Lifting a Drilling Mast on Route 17

studies and provided corroborative data at yields approaching usefulness for practical
excavation projects. The higher yield nuclear cratering experiments of the magnitude
required for the Isthmian canal excavation, however, remain to be carried out.

Engineering and Nuclear Operations Surveys
The engineering and nuclear operations surveys of Routes 17 and 25 were carried out
essentially as planned except for unavoidable delays. A field office in the Canal Zone and
base camps on each route were established. The latter were augmented by small satellite


camps along the alinements. The personnel involved numbered more than 800 at the height
of field activities.
Four weather stations were built and operated in Panama and Colombia to acquire the
weather data needed for prediction of the effects of nuclear operations and for other
purposes. Very high altitude air studies were conducted, using balloon and rocket-borne
instruments. Surveys of existing buildings and other structures within projected areas of
significant ground motion were made to estimate structural response and damage.
Bioenvironmental studies in the various radioecological systems were carried out by
scientists of different fields (marine, terrestrial, agriculture, forest, freshwater, etc.).
The engineering data program included topographic surveys to establish the preferable
alinements and their elevations. The surface geology along each route was mapped and
subsurface borings were carried out to confirm or correct geological interpretations. Rainfall
and stream flow were measured. People were counted.
As usual, in such preliminary surveys there are areas where more data and longer
collection periods would have been desirable. The data obtained, however, provide a basis
for a number of findings not previously possible.
Detailed analyses of the nuclear excavation technology and its potential application to
specific canal routes are contained in Annex V, Study of Engineering Feasibility, and its
appendices. Several of the technical evaluations developed from the surveys of Routes 17
and 25 are summarized below. Discussions of the unique political, military, and economic
aspects of these routes are contained in Chapter VII, Analysis of Alternatives.

Route 17

1. Geological drilling on Route 17 found competent rock along approximately
three-fifths of the 50-mile route. Hard materials predominate throughout the 20-mile
Continental Divide reach on the north and for 10 miles through the Pacific Hills on
the south. The center 20 miles through the Valley of the Chucunaque River,
however, consist largely of clay shales. This material, if excavated to steep slopes,
softens and slides as it weathers. Slopes as flat as one unit of vertical rise for each 12
units of horizontal measurement probably are needed for long-term stability in the
deepest excavation. Such slopes cannot be produced by single-row explosive
excavation, and the chemical explosive experiments conducted thus far indicate that
it is unlikely that multiple-row techniques can be developed to produce flatter slopes.
For this reason, cost estimates had to be based on the assumption that the center
portion of Route 17 would require conventional excavation.
2. The portions of Route 17 which appear to be suitable for nuclear excavation are
currently estimated by the United States Army Engineer Nuclear Cratering Group to
require about 250 separate explosives with a total yield of 120 megatons. They
would be fired in some 30 salvos of varying total yields over a period of 3 years or
longer. The largest salvo would have a total yield of 11 megatons. These estimates are
approximations only, based upon the limited route data available and calculated
nuclear explosive effects determined by extrapolation of low-yield experimental data
available in 1969. The AEC is confident that these estimates could be reduced, both
in number of explosives and in total yield required.


'j .

:Q=- .fi,

Ld .

Route 17 centerline trail through the Chucunaque Valley


Site survey base camp at Santa Fe Ranch, Route 17
3. Fallout predictions based upon meteorological conditions in the vicinity of Route 17
indicate that a land area of approximately 6,500 square miles containing an
estimated 43,000 persons would have to be evacuated during the period of nuclear
operations and for several months thereafter. This includes most of the area that
might be affected by ground shock or air blast, but precautions against glass breakage
and other damage in built-up areas would be required over a large area extending out
approximately 300 miles from the route. The AEC is confident, however, that a
significant reduction in the size of the area affected is possible.
4. Tidal currents in a partially nuclear excavated sea-level canal on Route 17 without
tidal checks would reach 6.5 knots in the conventional section.
Route 25
1. Geological drilling found competent rock through the Continental Divide reach at
the Pacific end of Route 25. This constitutes approximately 20 miles of the
alinement investigated. The greater portion of this 100-mile route passes through

alluvial material in the flood plain of the Atrato River. This reach is not suitable for
nuclear excavation, but is well suited for economical hydraulic dredging.
2. The portion of Route 25 that appears suitable for nuclear excavation is currently
estimated by the Corps of Engineers to require 150 individual explosives with a total
yield of 120 megatons. They would be detonated in some 21 row salvos over a period
of approximately 3 years. The largest salvo would total 13 megatons. The AEC
believes these estimates, like those for Route 17, could be reduced.
3. A land area of approximately 3,100 square miles containing an estimated 10,000
inhabitants would have to be evacuated to permit nuclear operations on Route 25.
As for Route 17, additional precautions would be required within a 300-mile radius
during actual detonations.
4. Tidal currents in a Route 25 sea-level canal without tidal gates would reach a
maximum of 3 knots.

Technical Feasibility of Nuclear Excavation of Routes 17 and 25
The Commission's Technical Associates for Geology, Slope Stability, and Foundations
were asked to assist in the evaluation of the technical feasibility of nuclear excavation of
Routes 17 and 25. Their report is Enclosure 2 to this report. The following extract
summarizes their findings as to the feasibility of nuclear canal excavation:
Feasibility of excavation by nuclear explosions is discussed in terms of: (1) the
present situation, i.e., the possibility of its being used with assurance for
interoceanic canal construction within the next ten years; (2) the requirements
for a continuing program of nuclear testing to assure future feasibility; and (3) the
possibilities of future applicability to weak rocks such as the clay shales of the
Chucunaque Valley. These discussions apply exclusively to the physical develop-
ment and configuration of craters which would result in a usable canal and
exclude all other effects of nuclear explosions such as seismic, air blast, and
radiological hazards.

( 1) Present Feasibility
The Technical Associates are in unanimous agreement that the techniques for
nuclear excavation of an interoceanic canal cannot be developed for any
construction that would be planned to begin within the next ten years.

The reasons for this opinion are:
a. Extension of the scaling relations now established by tests to the much higher
yield explosions is too indefinite for assured design and the "enhancement"
effects due to saturated rocks and row charge effects now assumed have not been
proved by large scale tests. There is a definite possibility of a major change in the
mechanics and shape of the crater formed by the much higher yield explosions
required for the canal excavations as compared to extrapolations from the
relatively small-scale tests carried out to date.
b. The effects of the strength of rock on the stability of "fall-back" slopes and
the broken rock crater slopes projecting above the fall-back to the great heights
required for an interoceanic canal have not yet been established.

Drilling for subsurface geological data

Therefore, the Technical Associates conclude that nuclear excavation cannot
safely be considered as a technique for assured construction of an interoceanic
canal in the near future.

(2) Future Development
The economic advantages of nuclear explosions for excavation of the very deep
cuts required by an interoceanic canal are so great that the present "Plowshare"
program should be continued, extended, and pursued vigorously until definitive
answers are obtained. Assured application of this technology to design and
construction of an interoceanic canal will require an orderly progression of tests
up to full prototype size, including full-scale row charge tests, in generally
comparable rock types, terrain and environment. Such a program may well
require another ten to twenty years to establish whether or not nuclear
excavation technology can be used with positive assurance of success for
construction of a canal along Routes 17 or 25.

(3) Application to Excavation in Clay Shales
A growing body of knowledge and experience indicates that high slopes in clay
shales, as in the Chucunaque Valley, or in more competent rocks underlaid by
clay shales, as in parts of the existing canal, may have to be very flat for long-term
stability and to avoid the danger of massive slides in the first few years after
excavation. Some attempts have been made to produce such flat slopes by
elaborate explosive techniques, such as over-excavation in anticipation of slides,
multiple row charges, and successive series of explosions or "nibbling" techniques
for application to problems such as construction of a sea-level canal across the
Chucunaque Valley. The Technical Associates believe this to be a highly
unpromising line of investigation with minimal chances of developing procedures
that could be used with assurance in the foreseeable future.

Experimental channel excavated by chemical explosive row charges at Fort Peck, Montana

In a letter (Enclosure 3) to the Canal Study Commission near the end of the sea-level
canal studies, the Chairman of the Atomic Energi Commission reported that any decision to
construct a sea-level canal in the near future must be made without reliance upon the
availability of nuclear excavation. He expressed the AEC's view that, given funds and
authorization, the technical problems of nuclear excavation could be solved within a
relatively short time; that each step which has been taken in developing nuclear excavation
technology has resulted in lowering the potential risk involved; that increased understanding
of the catering mechanism has increased belief in the potential benefit of this undertaking

for mankind; and that, if for any reason a decision to construct an interoceanic canal is
delayed beyond the next several years, nuclear excavation technology might be available for
canal construction.
It is clear that the technical feasibility of using nuclear explosives for Isthmian canal
construction has not been established and that any conclusion as to its technical feasibility
in the future for this purpose would be a speculative judgment of the potential of nuclear
excavation for the most sophisticated task that could be asked of it. It is equally clear that
the United States could not propose such excavation until the reliability of the technology
for such an application has been proved unconditionally.
Although mindful of, and in essential agreement with, the AEC's prognosis of eventual
availability of a nuclear excavation technology, the Canal Commission believes that many
experiments will be required in combination with practical applications in smaller projects
before the necessary degree of confidence can be assured. Although there is a considerable
body of scientific and engineering opinion that the technology has already been sufficiently
developed for application to projects of moderate size, such as harbors and highway cuts, it
is the view of this Commission that its perfection for use in canal excavation on Routes 17
or 25 is many years away.
Acceptability of Nuclear Canal Excavation
The political constraints upon the use of nuclear explosives for canal excavation were
recognized at the time the Commission's investigation was authorized by the Congress. It
was reasoned in the authorization hearings, however, that establishment of the technical
feasibility of nuclear canal excavation through experiments and practical applications of this
technology within the United States would ease removal of treaty constraints and other
political obstacles to its use for canal excavation. This reasoning was valid in 1964 and
remains so today, but neither technical nor political developments have proceeded at the
expected pace. Consequently, the international and local obstacles to nuclear canal
excavation are essentially unchanged from 1964. Although there have been encouraging
developments in international treaties bearing upon nuclear excavation, the Limited Test
Ban Treaty constraints remain in effect, and the Commission's studies indicate that
prospective host-country opposition to nuclear canal excavation is probably as great if not
greater than estimated in 1964.
The Limited Test Ban Treaty enjoins its signatories from conducting any nuclear
explosion which causes radioactive debris to be present outside the territorial limits of the
state under whose jurisdiction or control such explosion is conducted. The United States
recognizes, because there seems to be no possibility of excavating an Isthmian canal with
nuclear explosives without transport of some radioactive material across territorial
boundaries, that this provision could prohibit nuclear excavation of a sea-level canal. It was
also recognized by the United States and other signatories, including all canal-site countries,
that nuclear excavation for peaceful purposes could later become practicable and mutually
acceptable. Consequently, the Treaty was drafted to provide simple amendment procedures,
requiring only the concurrence of the United States, Great Britain, Russia, and a simple
majority of the parties to the Treaty.
Two other treaties bearing upon control of nuclear explosions have come into force
subsequent to the ratification of the Limited Test Ban Treaty. Both contain specific
provisions designed to facilitate the use of nuclear explosions for peaceful purposes,
including excavation, when the technology is developed and when mutually acceptable
procedures are established. In the Treaty of Tlatelaco (the Latin American Nuclear Free
Zone Treaty) fifteen Central and South American countries, including all Isthmian canal-site

countries, agreed to exclude nuclear weapons from their territories but specified conditions
for mutual cooperation in the employment of nuclear explosives for peaceful purposes.
The international agreement most encouraging for the future development of nuclear
excavation technology is the Nuclear Non-Proliferation Treaty now ratified by the three
principals and a majority of the signatories of the Limited Test Ban Treaty. Article V of this
Treaty provides that:
Each Party to the Treaty undertakes to take appropriate measures to ensure
that, in accordance with this Treaty, under appropriate international observation
and through appropriate international procedures, potential benefits from any
peaceful applications of nuclear explosions will be made available to non-nuclear-
weapon States Party to the Treaty on a nondiscriminatory basis and that the
charge to such Parties for the explosive devices used will be as low as possible and
exclude any charge for research and development. Non-nuclear-weapon States
Party to the Treaty shall be able to obtain such benefits, pursuant to a special
international agreement or agreements, through an appropriate international body
with adequate representation of non-nuclear-weapon States. Negotiations on this
subject shall commence as soon as possible after the Treaty enters into force.
Non-nuclear-weapon States Party to the Treaty so desiring may also obtain such
benefits pursuant to bilateral agreements.
The obligation assumed by the nuclear powers under Article V creates an environment
conducive to gaining international agreement upon modification or interpretation of the
Limited Test Ban Treaty to permit nuclear excavation projects. Discussions at the technical
level between United States and Russian representatives in 1969 and 1970 indicated that
Russia has great interest in the nuclear excavation technology and may be considerably
ahead of the United States in its development. These conferences produced joint statements
in favor of continued discussion of the technical aspects of peaceful nuclear excavation
technology; specific arrangements for dealing with the constraints of the Limited Test Ban
Treaty remain to be initiated.
Opposition to release of additional radioactive material in the world environment
probably would not be stilled by negotiation of a Limited Test Ban Treaty modification
authorizing peaceful nuclear explosive excavations. Many people throughout the world,
including some scientists, may remain convinced that the levels of radioactivity expected to
be released to the environment would not be acceptable.
The Commission's Study of Foreign Policy Considerations (Annex I) concluded that
within the canal-site counties, fear of the effects of nuclear explosions and fear of economic
dislocations could create major obstacles to nuclear canal excavation. The problems differ in
magnitude among countries, but none appears easily overcome.
It was found that more than a half-million people would have to be evacuated from
areas of Nicaragua and Costa Rica to permit nuclear excavation of Route 8. The
Commission then concluded that nuclear excavation of this route should be given no further
The evacuation requirements for Route 17 are formidable at this time and will grow
more so with the passage of time as the Darien area develops economically. The evacuation
area includes the homelands of Choco and Cuna Indian tribes with primitive cultural
attachments to their lands that could not be broken easily. A larger area extending to
Panama City on the west and Colombia on the east would be subject to possible ground
motion and airblast damage. The potential damages to masonry structures and window

panes outside the evacuation area would not be costly to repair, but the inconvenience to
thousands of inhabitants could be considerable. An additional major obstacle for Route 17
construction is the prospect of economic losses and dislocations in moving canal operations
away from Panama's metropolitan centers (See Chapter VII). These economic disturbances,
the imagined dangers of nuclear excavation, and the objections to evacuation of inhabitants
from the Route 17 area could cause widespread Panamanian opposition to a Route 17 canal.
The employment of nuclear explosives in the Continental Divide area of Route 25 in
Colombia would involve lesser problems of acceptability than would nuclear excavation in
Panama. The land area of evacuation would be only one-half as large. Although many of the
inhabitants of this area are Choco Indians whose removal would present problems similar to
those expected in Panama, the total evacuation requirement would involve only one-quarter
as many people. The required precautions against airblast and seismic shock would affect an
area of nearly the same magnitude as for Route 17.
The problems of public acceptance of nuclear canal excavation probably could be
solved through diplomacy, public education, and compensating payments. However, the
political and financial costs to the United States in obtaining such acceptance could offset
any potential saving in construction costs and gains in intangible benefits. Obviously, a wide,
deep channel constructed at low cost by nuclear excavation would have specific advantages
in military security and ship-size capacity in comparison with a conventionally excavated
canal. However, compensation costs unique to the dislocations and damages associated with
nuclear excavation, costs that not only would be incurred prior to and during construction
but also might be incurred for many years thereafter, would remain unknown quantities
until actually negotiated. Although pioneering in such a massive nuclear excavation project
would certainly add to the scientific and engineering stature of the United States,
proceeding with nuclear construction against extensive minority opposition would detract
from that prestige.

In the judgment of the Commission, the current prospects of nuclear canal excavation
At the present state of development of the nuclear excavation technology the
feasibility of its use in excavation of an Isthmian sea-level canal has not been
established. It is possible that the technology can be perfected to where such an
application is technically feasible, but many more nuclear excavation experiments
are needed. Technical, political, and budgetary constraints probably will continue
to slow development of the technology.
The outlook on balance favors eventual attainment of international acceptance of
practical applications of the nuclear excavation technology, but the time needed to
establish the necessary arrangements under the Limited Test Ban Treaty is
It is not possible at this time to determine whether a nuclear excavated canal would
be acceptable to Panama. The use of nuclear excavation on Route 17 may be
precluded by economic developments in the vicinity.
It is unlikely that nuclear excavation will become technically feasible on enough of
Route 17 to permit substantial cost savings in comparison with the cost of
all-conventional sea-level canal construction elsewhere in Panama.

It is probable that the technical feasibility) and cost advantages of the use of nuclear
explosives for excavation of portions of Route 25 in Colombia could be established
by an adequate program of experiments. The future acceptability of such a canal in
Colombia cannot now be determined.



Evaluation of the costs of the several routes considered for construction of a sea-level
canal required that the basic criteria of design and construction be the same for each route.
These criteria include: the maximum size of ship to be accommodated; the maximum
acceptable velocity of tidal currents; the size and shape of the navigation prism; the side
slopes of the excavation above the water surface required for stability; and the methods of

Size of Ships
Ships up to only 65,000 deadweight tons* can be passed through the locks of the
Panama Canal and very few ports in the United States can accommodate larger ships. The
world fleet, however, now includes many tankers and dry bulk carriers twice this size or
bigger. The Shipping Study Report (Annex IV) predicts that the proportion of such ships in
the world fleet during the period from 2000 to 2040 would probably be as shown in Table
The Commission concluded from these data that the demands of future world
commerce would adequately be met by providing for the transit of ships of 150,000 DWT
under all normal conditions of operation of a sea-level canal between the Atlantic and
Pacific Oceans.



Size Equaled or Exceeded DWT

Class Year 100,000 150,000 200,000

Freighters 2000 None None None
2020 None None None
2040 None None None

Bulkers 2000 3% 2% 1%
2020 6% 3% 2%
2040 10% 3% 2%

Tankers 2000 16% 5% 2%
2020 28% 10% 3%
2040 44% 18% 8%

*See Footnote on page 25.

Transit Capacities
Traffic through the Panama Canal has built up to more than 15,000 ships per year. It is
estimated by the Panama Canal Company that the future limit, without construction of
additional locks, will be 26,800 transits per year.
Recent trends indicate that the average amount of cargo per ship will increase more
rapidly in coming years than will the number of transits because of the increasing numbers
of large bulk carriers and tankers appearing in the canal ship mix. This divergence of the
growth rates of cargo tonnages and ship transits would undoubtedly become greater with
the opening of a sea-level canal that could accommodate ships of 150,000 DWT or greater.
The Commission concluded from the studies described in Annex IV that the demands
of world commerce would be well satisfied by providing for 35,000 transits per year initially
by means that would not preclude later expansion to at least double or even treble that

Navigation and Tidal Currents
Safety of navigation of a sea-level canal will be a controlling factor. The existence of
currents will impose few restraints on the passage of small ships but very large ships might
be unmanageable in an unrestricted canal under adverse tidal conditions.
Tidal fluctuations in the Atlantic along the Isthmus of Panama are small and somewhat
erratic. The tides on the Pacific side, on the other hand, are large and quite regular. The
resulting variations in level for a typical period are shown on Figure 17. The mean level of
the Pacific at Balboa averages eight inches higher than in the Atlantic at Cristobal.
If an unrestricted sea-level canal were built to connect these oceans, there would thus
be oscillating flow with net movements of water from the Pacific to the Atlantic. The
currents so produced would depend on the difference in levels at the time, on the length of
the canal, and on the size and shape of the navigation prism. The magnitude and direction of
such currents at all points along the several canals considered are set forth in Annex V
together with a description of the mathematical methods used to compute them. It was
found, for example, that on Route 10 the velocities of flow would be greatest at the
Atlantic entrance and would reach 5.1 knots on a few days each year and 3.7 knots under
average tidal conditions. Velocities of flow in a nuclear excavated canal would be
substantially greater, because of its greater cross-sectional area.
The Commission conducted extensive studies to determine the controllability of ships,
with consideration of the effects of currents, in a navigation prism of restricted width and
depth; these included a review of operating conditions in existing canals and restricted
waterways, a comprehensive mathematical analysis, and a series of tests of large-scale ship
models in a confined channel.
These studies indicate that:
1. The desirable speed of ships with respect to the land is 7 knots, equivelant to 8.05
statute miles per hour.
2. The speed of ships with respect to the water should not be less than 4 knots for
ships smaller than 50,000 DWT nor less than 5 knots for larger ships.
3. At least one powerful tug should be provided for control of each ship long enough
to cause blockage of the channel should the forward speed of this ship become less
than the velocity of the following current.
4. Powerful tugs should also be provided for assistance in stopping and for additional
control of all large ships and of small ships of limited maneuverability.



u 12

C 10
w 8

19 20 21 22 23
-6 VV
19 20 21 22 23




24 25

.. *I. .L X4

Tug assistance is required for all large ships in the present canal and is expected to be similarly required in a sea-level canal.

Tidal Checks
The uncertainty of safety of navigation under all tidal conditions led to consideration
of a new concept: the installation of a tidal control structure at each end of a long restricted
reach to limit the velocities of flow in a sea-level canal. It is contemplated that one structure
and gate would be located close to the Pacific entrance and another 24 to 25 miles north
thereof. The check gates would be moved alternately into position across or out of the
channel at intervals of 6.2 hours or some multiple thereof when the Pacific is at the same
level as the Atlantic. Under these conditions, the maximum velocity of flow would be
approximately 2 knots at the Pacific entrance and less elsewhere. It is also contemplated
that structures for gates would be built close to the Atlantic entrance where, if a gate were
installed and employed alternately with the Pacific gate, the maximum velocity could be
held to approximately 3 knots.
The contemplated tidal controls do not resemble the tidal lock and by-pass arrangement
proposed in the 1947 Study. The gates would not function as locks; no lifting of ships
would be involved, and no ship would have to stop in transit. They would be operated as a
pair; one would be rolled or floated into position across the channel at an appropriate time;

Scale model of a 250,000 DWT tanker undergoing tests in the Naval Ship Research and Development Center to determine
the controllability of large ships in a sea-level canal.
the other would be moved simultaneously back out of the way of oncoming ships. Their
position would then be reversed 6.2 or 12.4 hours later.
These tidal check gates would not have significant military vulnerability. Even if one or
both should be rendered inoperational by sabotage or military attack, they could easily be
removed from the channel. The higher tidal currents then encountered would not materially
impede the movement of warships and military cargo vessels through the canal. Figure 20 is
an artist's sketch of a tidal check structure at one end of the bypass in a sea-level canal.
The use of tidal checks at the ends of a one-way channel would require that all ships be
transited in convoys, scheduled to arrive at a check just after it is opened so that no ship
would have to stop or materially change its speed. These times will not be random; they can
be predicted accurately many months in advance after a few observations are made to
measure the lag in time with respect to the Pacific tides.
The length of each convoy will necessarily be limited by the distance between the tidal
checks. It has been found, as described in Annex V, that 4 ship lengths from bow to bow
would be a satisfactory average spacing. This distance between ships plus an allowance of at
least one mile of clear space ahead of the first ship in a convoy and of one-half mile behind
the last ship gives the following for certain critical locations of checks:


Artist's Sketch of a Tidal Check at the Entrance to a Bypass Channel



14 24
25 46
36 68

The shortest distance shown in this tabulation is that between the ends of a bypass,
consisting of 2 separate one-way channels, that could be constructed to augment the
transit capacity of a single-lane channel on Route 10. The largest distance is that between
the Pacific and Atlantic entrances of a canal on either Route 10 or Route 14. The
intermediate distance is the longest that would permit the use of an 18.6 hour convoy cycle;
it also would put a tidal check at the Atlantic end of a future bypass on Route 10.
The Commission elected to include in the designs structures for support of tidal gates at
or near the ends of each sea-level canal under consideration except Route 25, at each end of

the potential bypass on Route 10, and at a point 24 miles north of the Pacific entrance of
Route 14.
Figure 21 schematically portrays the location and operation of the tidal checks in the
single lane configuration. Figure 22 similarly shows the operation of the bypass

Cross Section of Navigation Prism
The Commission recognized early in its studies that the transit capacity of a single-lane
channel on all but the very long routes would meet all probable demands for many years
and that this capacity could most economically be augmented by the addition of a bypass.
The Commission also recognized that the cost of construction would be increased greatly by
providing for two-way traffic, because the width of a two-way channel should be more than
double the width of a single-lane canal.
It was developed from the comprehensive studies described in Annex V that any of the
following combinations of ship speed, channel width, and channel depth would provide
equal navigability for 150,000 DWT ships:



Speed in Water Bottom Width Water Depth
Feet Feet

9 Knots 500 72
550 60

11 Knots 550 85
600 77
650 65

The Commission recognized that the 9-knot ship speed in the water was for the
condition of 2-knots current with tidal checks in service and that the 11-knot ship speed was
based on passage against a 4-knot current. It accepted, however, the recommendation of its
Engineering Agent that this higher velocity be used for cost estimating purposes because it
may be found practicable over the years to operate in currents of this velocity, and because
it would permit passage of 250,000 DWT ships under controlled conditions.
The Commission, therefore, elected to use for all conventionally excavated channels a
single-lane navigation prism, having a bottom width of 550 feet, a center depth of 85 feet,
and a depth at the sides of 75 feet.

Side Slopes of Excavation
At the time the Panama Canal was built there was little knowledge of soil and rock
mechanics and much steeper slide slopes were used than would now be customary. Most of



Step 1




Gates move at mean Convoy t clears
tide as Convoy 1 is one-way channel.
between them and
moving toward the




Step 3
Convoy 2 is about
to enter one-way
channel from the




Step 4
Gates move at mean
tide as Convoy 2 is
between them and
moving toward the

Step 5
Convoy 2 clears
one-way channel as
convoy 3 starts to
enter it.

:00 AM 7:30 AM :5838 PM 6:35 PM 943 PM





Gates move at mean
tide as Convoy 3 is
between them and
moving toward the


z g


0 P'

S Tidal

= -- I

Step 1 Step 2 Step 3 Step 4 Step 5
Convoys la and lb Convoys la and lb Convoys 2a and 2b Convoys 2a and 2b Convoys 3a and 3b
are in the two lane clear the one-lane are now entirely clear the one-lane are now entirely
bypass section sections and con- within the bypass sections and con- within the bypass
about to enter the voys 2a and 2b section approaching voys 3a and 3b section approaching
one-lane sections as enter the one-lane the gates which shift enter the one-lane the gates which shift
the gates shift at sections behind on the mean tide as section behind on the mean tide as
mean tide. them. they approach. them. they approach This
is identical to Step


3:00 AM 6:07 AM 9:15 A 12:22 PM 3: 8PM




the slides along the Panama Canal have stemmed from this cause.
The Technical Associates of the Commission, after review of geologic and other
conditions along the existing canal and the several routes for a sea-level canal, recommended
that the slope criteria given in Table 14 be used in calculations of the quantities of material
to be excavated.
The proper side slopes for deep excavation in hard rock and soft rocks were also
investigated by the Engineering Agent, as described in Annex V. The findings of this study
were consistent with the recommendations of the Technical Associates. The Commission
accepted, for purposes of evaluating the costs of construction of a sea-level canal on each of
the several routes, the recommended slope criteria.

Construction Methods
The potential of nuclear excavation is discussed in a separate chapter; hence, this review
of construction methods is limited to conventional procedures.
Excavation will be the largest item of cost of a sea-level canal on any of the routes
considered, because of the tremendous volumes of material to be removed. The unit costs
(dollars per cubic yard) will vary widely depending on the nature of the materials and
whether or not the channel must be excavated below water. The unit cost of excavation of
hard rock will naturally be more than that of soft rock. The unit cost of removal of any
material will be less if the work can be done above water than if it has to be dredged, except
for unconsolidated deposits at moderate depths.
The Commission recognized that, in the years before actual construction of a sea-level
canal would be started, there probably will be major changes in methods and improvements
in equipment, but it directed that all estimates of cost be based on proved methods of
construction and on only foreseeable improvements of equipment now available. Four
general methods of excavation and their application to the different routes are described in
Annex V. These methods are:
1. Power shovels and truck haul disposal for isolated portions of the work and to
remove the tops of hills.
2. Power shovels and railroad haul disposal for the major portion of all excavation
above water.
3. Barge mounted shovels or draglines or bucket dredges and barge haul disposal of
material excavated below water.
4. Hydraulic dredges and pipeline disposal of unconsolidated sediments below water.



Condition A:

Condition B:

Condition C:

For locations where the canal would be remote from the
existing canal. (The existing canal would be available for
use during a proving period.)

For locations where the canal would be separate from the
existing canal but in close proximity. (Excavation would be
performed in the dry and gradual drainage would be possible
during construction. An observational period would be
available prior to the canal becoming operational.)

Locations where the canal would be adjacent to the existing
canal in an area with a history of slides. (The area would have
undergone long-term creep, and the slopes would be subject
to rapid drawdown. The maintenance of traffic on the
Panama Canal during construction is considered.)

Nature of Material Side Slopes of Cut
Horizontal + Vertical

High Quality Rock 0.375 Overall Including
Construction Benches

Intermediate Quality Rock 0.625 Overall Including
Construction Benches

Low Quality Rock Height of Cut in Feet
Such as Clay Shale 100 200 300 400 500

Condition A 1.0 4.1 6.0 7.5 8.6

Condition B 1.0 5.3 7.8 9.5 10.7

Condition C 1.0 6.4 9.2 11.4 13.0

Earth slide blocking the Panama Canal in the Gaillard Cut, October 1915




Construction of a sea-level Isthmian canal would impact on the land and ocean
environments in several ways. The physical effects can be estimated with some confidence
for both. The total effects upon land ecology can also be estimated with confidence, but the
effects upon ocean life are now uncertain because of the dearth of knowledge of the
regional ocean ecology.

The Land Environment
Canal excavation on any route would require clearing a right-of-way across the Isthmus
and disposal of great volumes of spoil on land and off-shore. These effects from
conventional excavation would extend a few thousand yards from the canal routes; the spoil
areas and destruction of forested areas incidental to nuclear excavation would be more
extensive. The excavation and spoil disposal plans for each conventionally excavated route
provide for containment of most spoil in areas where runoff would be least harmful and
where the fill would be most useful.
Stream courses would be altered where they intersect a canal on any route.
Construction of a sea-level canal on either Route 10 or Route 14 would divide Gatun Lake;
in the case of Route 10 there would be no material change in total area, but on Route 14
the remaining surface area would be about 62 square miles as compared to the present area
of 165 square miles.
The Panama Canal is already a barrier to faunal migration along the Isthmus. Any new
canal would be an added barrier.
Detailed estimates of the areas that would be affected on each route are contained in
Annex V, Study of Engineering Feasibility, together with specific estimates of potential
environmental effects. It can be concluded from these estimates that all permanent effects
on land areas would be limited to the immediate vicinity of the canal routes and would
result in no harmful ecological changes of significant magnitude. For the conventionally
excavated routes, the potential changes of the land environment and the freshwater ecology
appear to be less than those that were created by construction of the existing canal which
required the creation of Gatun Lake.
Medical experience in Central America and medico-ecologic studies performed for the
Commission have demonstrated the need for stringent and continuing preventive-medicine
measures and a responsive medical support program. Insect and rodent control, waste
disposal, and health education would be particularly important. Immunization would be
directed primarily against yellow fever, smallpox, typhoid fever, and tetanus. A special
effort would have to be made to control malaria and other parasitic diseases, enteric
diseases, and other tropical ailments. The present conditions in the Canal Zone demonstrate
that a healthy environment can be achieved with a well planned and executed medical

The Ocean Environment

Physical Effects
The permanent physical changes, e.g., temperature, currents, and salinity, to the ocean
environment as a result of opening a sea-level Isthmian canal would be small and limited to
areas adjacent to the canal entrances. The water level on the Pacific side, twice each day, rises
from 5 to 11 feet above and falls 4 to 10 feet below that on the Atlantic side. A sea-level
canal without tidal control structures would thus have strong currents that would change
direction twice each day with the rise and fall of the tides. While no single tidal phase would
endure long enough to cause a complete flow-through of water from one ocean to the other,
there would be a gradual net transport of water from the Pacific to the Atlantic because of
the slightly higher mean sea level of the Pacific. The transported water, however, would be
drawn from the upper levels of Panama Bay where it is already within a few degrees of the
water temperature on the Atlantic side. It would tend to become warmer as it moved back
and forth in the canal until it ultimately emerged at the Atlantic end. The predicted effects
on the receiving ocean's temperatures or currents are insignificant.
Spoil disposal and breakwater construction would considerably alter the existing shore
configurations and fill in large offshore areas. However, similar operations affected almost as
large an area in the construction of the present canal. Colon on the Caribbean side and Fort
Amador on the Pacific side were once ocean areas. No harmful environmental effects have
been identified with these large landfills.
Underwater excavation on Route 14 would have a very substantial effect on the water
in Gatun Lake; there would be some effect also caused by underwater excavation in the
approaches to any canal. Excavation in the dry, however, which would represent most of
the work on Route 10, could have only a nominal effect upon ocean areas near the
entrances. It is unlikely that sediment would be carried in canal flows, predominantly from
the Pacific to the Atlantic, in excess of the sediments that would reach the oceans naturally.

Biotic Interchange
An unobstructed sea-level canal across the Isthmus would allow relatively easy passage
of marine organisms. Certain forms of marine life now pass through the Panama Canal even
though Gatun Lake provides a highly effective biotic barrier. Barnacles and other immobile
organisms are carried through on the hulls of ships, and a variety of small plants and animals
is carried in ballast water from one ocean to the other. Transfers of marine life by these
means have been taking place continuously for more than 50 years. No harmful results have
yet been identified in either ocean as resulting from them. However, linking the oceans with
an unobstructed salt water channel would greatly facilitate the movement of these and other
Taxonomic studies indicate that the Atlantic and Pacific Ocean species along the
Isthmus are closely related, even though few are identical. The similarity results from the
linking of the Atlantic and Pacific Oceans until recent geologic time, perhaps 3 million
years ago. Concern has been expressed about the potentially undesirable biologic
consequences when such closely related species are allowed to intermingle and about the
ecological consequences of the movement of marine organisms generally. Marine biologists
are not in agreement on this subject; their predictions range from disaster to possible

beneficial results.
Because of the great divergence of views on the ecological consequences of a sea-level
canal, the Commission had a study made of the potential effects. This study, a limited one
because of time and fund constraints, was accomplished by the Battelle Memorial Institute
(BMI) in association with the Institute of Marine Sciences of the University of Miami. The
ocean populations on both sides of the Isthmus were studied, giving special attention to the
fish and crustaceans that are important to commercial and sport fishermen. The potential
transport of water, chemicals, sediment, and planktonic organisms between the oceans was
mathematically modeled and the resultant effects postulated. The BMI findings are
summarized as follows:
On the basis of the limited ecological information currently available we were
unable to predict the specific ecological consequences of marine mixing via a
sea-level canal. Preliminary modeling studies indicate that the net flow of water
would be from the Pacific to the Atlantic. This would result in minor
environmental changes near the ends of the canal and near the shore to the east of
the Atlantic terminus. Passive migration of planktonic organisms would occur
almost entirely in the same direction. Active migration of nekton could occur in
either direction, but environmental conditions in the canal would favor migration
from the Pacific to the Atlantic. We have found no firm evidence to support the
prediction of massive migrations from one ocean to another followed by
widespread competition and extinction of thousands of species.
Evidence currently available appears to indicate a variety of barriers to migration
of species from one ocean to another and/or the subsequent establishment of
successful breeding colonies in the latter. Environmental conditions in the canal
would constitute barriers to the migration of both plankton and nekton, and the
effectiveness of these barriers could be enhanced by engineering manipulations of
freshwater inputs to the canal and other artificial means. The marine habitats and
biotic communities at the opposite ends of most proposed sea-level canal routes are
strikingly different. Where similar habitats do occur on both sides of the Isthmus,
they are already occupied by taxonomically similar or ecologically analogous
species. These differences in environmental conditions on the two sides of the
Isthmus and the prior occupancy of similar niches by related or analogous species
would constitute significant deterrents to the establishment and ecological success
of those species which may manage to get through the canal.
It is highly improbable that blue-water species like the sea snake and the
crown-of-thorns starfish could get through the canal except under the most unusual
circumstances. On the other hand, we can be fairly certain that some Pacific species
could pass through the canal and could become locally established in the Pacific
waters of the Atlantic. It is also improbable that these species would be able to
survive in the Atlantic outside the region of environmental modification due to
water flow through the canal. The Pacific species most likely to become established
along the Caribbean shore are those of estuarine and other shallow-water habitats,
the very habitats that have been least thoroughly studied.
To improve the precision and reliability of these and similar ecological
predictions would require additional information and quantitative data which

could be provided only by a comprehensive program of field, laboratory, and
theoretical (modeling) studies. Extensive taxonomic surveys would be required to
improve our knowledge of the biota of the Tropical Western Caribbean and
Tropical Eastern Pacific. Except for a few economically important species,
ecological life history data are virtually non-existent. Basic biological studies
would be required to obtain such information. The geographical extent and
physiochemical characteristics of the marine habitats on the two sides of the
Isthmus are imperfectly known from a few cursory surveys. The species
composition and functional-ecological structure of the biotic communities that
characterize these habitats are imperfectly known and inadequately understood.
The parameters required to predict the flow of water and plankton through the
canal have not been adequately measured. The processes of migration, establish-
ment, and competition have been but little studied and are not well understood. To
remove these deficiencies in our knowledge would require a comprehensive,
long-term program of well-coordinated physical oceanography, marine ecology, and
basic marine biology studies.
The risk of adverse ecological consequences stemming from construction and operation
of a sea-level Isthmian canal appears to be acceptable. Since it is not possible to determine
the specific ecological effects without extensive studies before, during, and after
construction, the Commission requested the National Academy of Sciences (NAS) to
recommend a program of long-term studies to be undertaken if the decision is made to build
a sea-level canal. The complete NAS report and recommendations, together with the report
of the BMI study, are included in Appendix 16 to Annex V, Study of Engineering
Should future research indicate the need for a biotic barrier in addition to tidal gates, it
would be possible to install a temperature or salinity barrier. No such barrier was included in
the designs, because the need for anything in addition to tidal gates has not been
established. A thermal barrier created by discharge of hot condenser water from a power
plant into the canal between the tidal gates would be feasible, although the costs would be
high. Delivery of fresh water from Gatun Lake into a Route 10 or Route 14 sea-level canal
between the tidal gates would be practicable, but the available supply of water is limited.
Continuous operation of tidal gates on either Route 10 or Route 14 would accommodate all
potential traffic past the year 2000, by which time the consequences of increased migration
of biota through the canal should have been determined.

Combined Effects
The environmental impact statements required by Section 102 of the National
Environmental Policy Act of 1969 (Public Law 91-190) are included in Annex V, Study of
Engineering Feasibility. These statements cover not only the effect of mixing the oceans but
other environmental changes which could be expected as a result of constructing a sea-level



The choice of a feasible sea-level canal excavated by conventional means is limited to
Routes 10 and 14. In the analyses which follow these two alternatives are examined in
The route technically most promising for construction using nuclear explosives is Route
25 in Colombia; this is analyzed for possible future consideration, should the feasibility of
nuclear excavation eventually be established. A limited analysis of Route 17 is also included,
although its selection is considered unlikely.
As a basis for evaluating the incremental costs and benefits of a sea-level canal, an
analysis of augmentation of the existing lock canal is also provided.
Each of these alternatives is evaluated on the bases of its engineering feasibility, cost,
capacity, expandability, political acceptability, and its defense aspects.
Routes 5, 8 and 23 are analyzed only briefly, inasmuch as they are clearly less desirable
than other routes.
A brief description of the capabilities of the present lock canal is provided as a point of

The Panama Canal
The existing lock canal (Route 15) consists of short sea-level approaches to an elevated
midsection formed by Gatun Lake, which is regulated between elevations 82 and 87 feet
above sea level (Figure 24). The Gatun Locks on the Atlantic side consist of parallel twin
locks of three equal lifts. On the Pacific side there are two lock structures a double lift at
Miraflores which raises transiting vessels to an intermediate pool called Miraflores Lake, and
a single lift at Pedro Miguel raising the vessels to the level of Gatun Lake. All lock chambers
are 1,000 feet long, 110 feet wide, and at least 41 feet deep. The lock dimensions limit
transits to ships with lengths of less than 1,000 feet, beams of not more than 106 feet, and
drafts of less than 40 feet (approximately 65,000 DWT). Its annual capacity is now limited
by the available water supply to approximately 18,000 transits per year. The ultimate
capacity of the existing locks, upon completion of the long-term improvement program of
the Panama Canal Company, is estimated to be 26,800 annual transits. This program.
involving costs of approximately $100 million, includes provisions for pumping sea water
into Gatun Lake or recirculating lockage water.

Alternatives Eliminated from Further Consideration
Routes 5, 8, 17, and 23 were found to have disadvantages of sufficient magnitude to
eliminate them from consideration as alternatives to other routes. The reasons for doing so
are briefly summarized. Details are in the Annexes to this report.






5 0 5 10








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Gatun Locks at the Caribbean end of the Panama Canal


Widening the Panama Canal channel from 300 feet to 500 feet was completed in 1970.


_ . .j ~ ...- . ."L" .- ." .-.... j

Miraflores Locks and excavation for third locks at left. Pedro Miguel Lock and Gaillard Cut are in the background.

The Panama Canal is now lighted throughout its length and operates around the clock.

Route 5 Lock Canal (Figure 29)
Data available from 1931, 1947, and 1964 studies of the 167-mile route in Nicaragua
indicate that a lock canal capable of accommodating 110,000 DWT ships and having
approximately the same annual transit capacity as the existing Panama Canal would cost
about $4 billion. A lock canal designed to meet the 150,000 DWT ship size and 35,000
annual transit capacity criteria would cost much more.

Route 8 Sea-Level Canal Excavated by Either Nuclear or Conventional Excavation
A sea-level canal on Route 8 through Nicaragua and Costa Rica (Figure 29) would cost
an estimated $5 billion to construct by nuclear methods, if available, and $11 billion by
conventional methods. This latter cost is prohibitive, and nuclear excavation is infeasible for
the reasons given in Chapter IV.

Route 17 Sea-Level Canal Excavated by a Combination of Nuclear and Conventional
Route 17, approximately 100 miles east of the present Panama Canal (Figure 30) is
remote from Panama's developed areas an essential requirement for nuclear excavation.
Approximately 30 miles of its length through the high elevations (that involve the greater
portion of the total excavation volume) appear technically suitable for nuclear excavation.
Estimated construction costs, assuming partial nuclear excavation would be feasible, total
$3.1 billion more than the estimated cost of all-conventional construction on Route 10 or
Route 14.
The problems related to nuclear excavation described in Chapter IV are not the only
obstacles to a Route 17 canal. Panama could be expected to object, for the Route would
involve major dislocations of the economy of Panama. Panama City and Colon depend upon
the present canal and its associated military bases directly and indirectly for some 74 per
cent of their economic activity. Although the United States military bases could be left
where they are if canal operations were transferred to Route 17, a large phasedown of
employment and business activity would accompany the closure of the present canal. The
Stanford Research Institute estimates that employment within 30 miles of the present canal
would decline by 45,000 with the changeover to Route 17 and only 36,000 new jobs would
develop in the new area. The total Panamanian GDP is also estimated to grow somewhat
more slowly with the construction and operation of a Route 17 canal than with one on
Route 10 or Route 14.
Route 17 offers some military advantages because of its remoteness and its partially
nuclear excavated channel (Annex II, Study of Canal Defense). The wide, deep nuclear
reaches, comprising three-fifths of the total land cut, would be relatively invulnerable to
blockage by scuttled ships, making defense a less difficult problem than on other routes.
However, its potential advantages do not now appear to be significant in comparison with
the magnitude of the potential problems in nuclear excavation and in transfer of canal
operations away from the vicinity of the present canal.

Route 23 Conventional or Combined Nuclear and Conventional Sea-Level Canal
The sea-level canal, on Route 23 (Figure 30), proposed by a representative of the
Government of Colombia, would have a length of 146 miles, including more than 27 miles

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17, 23, AND 25
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Line camp at 1000 foot elevation where Route 17 crosses the Continental Divide

of seaward approach channels. This alone makes it non-competitive with other routes.
Approximately one-third the length would be in Colombia, generally along the trace of
Route 25, and two-thirds in Panama. The Pacific terminus would be the same as for Route
17 and its Caribbean terminus the same as for Route 25.
Were nuclear excavation feasible, about 20 miles through the Continental Divide would
be excavated by nuclear explosives. The remainder at lower elevations would be
conventionally excavated. Construction costs, based on the limited data available, are
estimated to range from $2.4 billion with partial nuclear excavation to $5.3 billion for
excavation wholly by conventional methods.
The great length of a Route 23 sea-level canal would involve greater operating and
maintenance costs than would other routes. Although there could be political advantages in
having a canal pass through two host countries, the technical disadvantages of Route 23 and
the obvious economic disadvantages for Panama in a remote canal that shared its revenues
with Colombia combine to eliminate this route from further consideration.

Route 25 Conventional and Nuclear Sea-Level Canal
Route 25 (Figure 32) is wholly within Colombia near the Panamanian border. It is
approximately 200 miles east of the existing Panama Canal. Its total length is 101 miles. A

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The town of Rio Sucio on the bank of the Atrato River. Excavation of this section of Route 25 through the flood plain of
the Atrato River would be accomplished by hydraulic dredging.

sea-level canal on this route would not be competitive in cost with other routes without the
economies promised by nuclear excavation.
Approximately 20 miles of Route 25 through the Continental Divide, the upper
Truando River Valley, and the Saltos Highlands would be excavated by nuclear explosives.
The remainder of the route, starting with elevations below 75 feet in the Truando Valley,
would be excavated conventionally almost entirely by hydraulic dredging. Most of this
portion of the route is through the flood plain of the Atrato River at elevations only a few
feet above sea level. At isolated high spots and at the juncture of the nuclear and
conventionally excavated reaches conventional dry excavation methods would be used.
Hydraulic excavation along nearly 80 miles of Route 25 at low elevations would be
relatively inexpensive, and the incremental costs of wider channels would be small in
comparison with the costs of wider channels on other routes.
Two alternatives, shown schematically in Figure 34, are:
The single bypass configuration.
The dual lane configuration.
In order to meet the initial 35,000 annual transit capacity criterion, the length of the
route would require at least one bypass, which ideally should be located in the center of the
single-lane channel and be equal to one-third the length of that channel. The 101-mile length


w 700 -

-100 IIIII
0 20 40 60 80 100






of a canal on Route 25 would limit peak tidal currents to 3 knots. The capital cost of this
canal has been estimated, as shown in Annex V, to be $2.1 billion. However, as stated in the
report of the Commission's Technical Associates:
A valid comparison cannot be made between Routes 10, 14C and 14S, all
of which would be excavated entirely by conventional means, and Routes 17
and 25, both of which require nuclear excavation for the planned
construction. Nuclear excavation is not yet a proven construction technique
and there is no assurance that construction plans and cost estimates based
on present knowledge are valid. Therefore, dollar cost comparisons at this
time have no true significance.

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Alto Curiche weather station near southern end of Route 25

Colombia's lack of enthusiasm for a United States-controlled canal on her territory is
discussed in Chapter II, and the current uncertainties in regard to the feasibility of nuclear
canal excavation are described in Chapter IV. However, both the technical and political
prospects of eventually employing nuclear explosives for canal excavation appear more
promising for Route 25 than for any other route.
Defense of a sea-level canal on Route 25 would present complex problems. Its land
length is nearly three times that of routes in Panama, and all defense facilities buildings.
roads, airfields, etc. would have to be provided. It is unlikely that United States military

forces could be stationed in Colombia. Although the Colombian armed forces would be
capable of providing a measure of security for a Route 25 canal, outside assistance would be
required to provide a level of security acceptable to the United States.
A critical defense problem that would accompany construction on Route 25 is that of
security of the present canal during the 10- to 15-year construction period. If construction
were undertaken as a result of inability to reach agreement in negotiations for a new canal in
Panama, a hostile environment would almost certainly develop. In this event, defense of the
existing canal could be difficult and expensive.
At the present, a canal in Colombia controlled by the United States appears neither
desirable for the United States nor acceptable to Colombia. Should construction of a new
canal elsewhere be long deferred and the practicality of nuclear canal excavation be proved
in the meantime, it is possible that other factors bearing on the acceptability of a sea-level
canal in Colombia would have changed and Route 25 would merit reconsideration.

The Third Locks Plan
There have been many proposals for increasing the capacity of the present canal by
construction of additional locks. The most promising are variations of two basic plans: The
Third Locks Plan and the Terminal Lake Plan. The former was actually initiated in 1939 and
discontinued after expenditure of approximately $75 million on excavations for larger locks
adjacent to the existing ones. The new locks would have been 140 feet wide, 1200 feet long,
and 50 feet deep. Locks of this size would accommodate vessels of up to approximately
110,000 DWT.
The Terminal Lake Plan would consolidate Miraflores and Pedro Miguel Locks on the
Pacific side, raising Miraflores Lake to the level of Gatun Lake. In the process a third lane of
locks would be added on both the Atlantic and Pacific sides. This plan has the advantage of
providing an anchorage area above the Pacific locks which would eliminate navigation
hazards now encountered in that area. A variation of the Terminal Lake Plan, proposed by
S.2228 and H.R. 3792, 91st Congress, provides for three lanes of locks, the largest being
140 feet wide, 1200 feet long, and 45 feet deep. The Pedro Miguel Lock would be
eliminated and the operating level of Gatun Lake would be raised 5 feet to a maximum of
92 feet above sea level.
None of the proposed lock plans would provide for the transiting of 150,000 DWT
ships, the minimum size that would enable the canal to compete with alternate routing for
bulk cargo. Hence, a Deep Draft Lock Canal Plan was developed that incorporates the best
features of the proposed plans with locks (160 feet by 1450 feet by 65 feet) capable of
accommodating 150,000 DWT ships. This plan (Figure 36) provides a reference base for
evaluation of sea-level canal alternatives. Table 15 summarizes its characteristics and costs.
None of the proposed lock plans, including the Deep Draft Lock Canal Plan, would
permit transit of the United States Navy's largest aircraft carriers which have angled flight
decks too wide for the locks. The estimated construction cost of locks adequate for these
carriers was $800 million more than the cost of locks for 150,000 DWT ships. Therefore, a
lock canal capable of transiting these carriers was given no further consideration.
The addition of a third lane of locks would increase annual transit capacity by
approximately 8,000, making the toal annual capacity 35,000. This capacity could



i 1300' 75




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NOTE, New locks srgle lane 161Y 14W 65' for 150,01 WT design min. Gatun Lake 8189

5 0 5 10




Total construction cost $1,530,000,000
Channel excavation volume 560,000,000 cubic yards
Channel excavation cost $570,000,000
Cost of new locks $550,000,000
Construction time 10 years
Operation and maintenance costs $71,000,000/year
(for 35,000 transits)

These data are based on construction and operation of a deep
draft lock canal with a land cut of 36 miles and 20 miles of
approach channels. Eight miles will have a 500- by 65-foot
channel (75-feet deep at centerline). The remainder will accommodate
two-way traffic. A third lane of locks will be added to the
existing locks. They will be 160- by 1450- by 65-feet and will
accept 150,000 DWT ships.

This improved lock canal would have an effective capacity of
35,000 transits per year. At this capacity, the time lost by
the average ship in slowing down, awaiting its turn to enter
the canal, transiting, and then regaining open ocean speed is
estimated to be about 25 hours.

meet projected demands for commercial transits through this century at a lesser cost than
that of a sea-level canal. This is its only major advantage. However, expansion to meet
further traffic growth would not be practicable.
The United States has held that the provisions of the Treaty of 1903 permit the
building of a third lane of locks. This may not be a practicable alternative because a
controlling determinant of the long-term viability of any course of action in Panama is its
acceptability to the government and people of Panama, the United States, and, hopefully, to
Latin America generally. It seems obvious that major augmentation of the existing canal
would not serve United States interests unless accomplished under a new treaty arrangement
or major revision of the present treaty willingly entered into by Panama.
Augmentation of the existing canal under treaty arrangements comparable with those
proposed in 1967, with an appropriate extension of the period of United States control,
would have favorable effects on the economy of Panama (see Annex I, Foreign Policy
Considerations). The political disadvantage of the third-locks solution is that it would tend
to increase operating personnel and defense requirements that are currently causes of
concern to Panama.
Construction of a third lane of locks would not reduce the vulnerability of the lock
canal to long-term interruption by sabotage or military attack. The critical weaknesses of
the locks and the high level lake would remain unchanged. The basic vulnerability of the

lock canal would continue to require large defense forces on site and provisions in United
States strategic plans for the contingency of long-term closure of the canal in wartime. The
lock canal's current inability to transit the Navy's aircraft carriers would continue.

Route 14 Conventionally Excavated Sea-Level Canal
The two alinements of Route 14 that were evaluated are identical except through the
Continental Divide (see Figure 37). Both follow the trace of the present Panama Canal
without its many angularities. Route 14 Combined (14C) would involve deepening and
widening of the present Gaillard Cut; Route 14 Separate (14S) would require a new cut
through the Divide about one mile to the southwest of the present cut. Both alinements pass
under the existing bridge at the Pacific end of the present canal and utilize excavation
already accomplished for the unfinished third locks project.
The combined cut offers considerable savings in the volume of excavation because of
the lower elevation through the Divide. However, only the separate cut permits excavation
in the dry to project depth in the Continental Divide area. A major disadvantage of the
combined alinement is its inevitable interference with the operation of the existing canal
during the ten or more years of actual construction. The Gaillard Cut is now only 500 feet
wide and must be operated on a one-way basis for the largest ships that transit the canal.
Cut widening and deepening would further limit capacity during the construction years.
Excavation to 85 feet below sea level in this cut could induce slides that would block the
existing canal for long periods. These and other potential disadvantages of Route 14C
discussed in detail in Annex V led the Commission to conclude that Route 14S would be
the preferable sea-level canal alinement within the existing Canal Zone, regardless of its
slightly greater cost.
Three feasible design configurations for Route 14S have been considered (Figure 38).
Two include a centrally located single-lane section while the other includes two parallel
single-lane sections; all sections are cut to the design channel criteria. Each configuration
includes 1400 by 85 foot two-lane approach channels at both its Atlantic and Pacific ends.
The configurations, in the ascending order of cost and capacity, are:
A 33 mile single-lane section.
A 24 mile single-lane section.
Two parallel 19 mile single-lane sections.
Each of these could be constructed with check gates to limit the tidal currents. The location
of the tidal checks would vary with the configuration and the maximum acceptable current.
The methods of operation with tidal gates in the various configurations of Route 14S,
channel design, and convoy operations would be essentially the same as for Route 10,
discussed later in more detail. The initial transit capacity would be at least 35,000 annually.
The topography of Route 14S does not lend itself to a bypass, which should be located
along the center third of a canal alinement to be effective. Consequently, the logical
expansion steps involve progressive shortening of the one-way section by extending the
Atlantic approach across Gatun Lake, where elevations are much lower than those close to
the Pacific. The maximum currents in the single-lane section would tend to increase as this
section became shorter, but tidal gates could provide appropriate control. Shortening the
restricted section would significantly increase capacity.



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24 MILES CH[Ni.|
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In the final phase of construction of a sea-level canal on Route 14S the water in the
channel would be lowered from the level of Gatun Lake to sea level. This would be
accomplished by removal of the plugs left at either end of Gatun Lake and the simultaneous
construction of an earth dam in the old canal channel near Gamboa to divert the Chagres
River to the Pacific. This drawdown would create a hazard of slides. As much as three
months would be required for the changeover, during which time there could be no traffic
through the canal.
Political factors bearing on the feasibility of a sea-level canal on any route within or
near the Canal Zone and the effects upon the economy of Panama would not be measurably
different (Annex I). Route 14 has the advantage, however, of being wholly within the Canal
Zone. Construction on Route 14 would require no acquisition of privately owned land and
would create the minimum local disturbances.


Total construction cost $3,040,000,000
Channel excavation volume 1,950,000,000 cubic yards
Channel excavation cost $2,210,000,000
Construction time 16 years (includes 2 years
for preconstruction design)
Operation and maintenance cost $56,000,000/year (for
35,000 transits)
These data are based on construction and operation of a sea-level
canal with a 33-mile single-lane land cut and 21 miles of two-lane
approach channels. Ships up to 150,000 DWT could be accommo-
dated under all conditions; larger ships up to 250,000 DWT could
be accommodated under controlled conditions. Tidal gates would
be installed and used continuously to limit current to no more than
2 knots.
This configuration would have an effective capacity of 39,000
transits/year. At this capacity, the time lost by a ship in slowing
down, forming into a convoy, passing through the canal, and re-
gaining open ocean speed would be comparable to time lost by a
ship passing through the Panama Canal in 1970. At lower traffic
levels, time lost would be significantly less.

If experience showed that additional capacity would be required,
the two-lane approach channel on the Atlantic end could be extended
inland across Gatun Lake for 9 miles, reducing the single lane reach
to 24 miles. The cost of this additional effort would be $430,000,000
The new configuration would have an effective capacity of 55,000

Interference with traffic through the existing canal during construction of a sea-level
canal and the ultimate elimination of the existing canal and the partial elimination of Gatun
Lake would be significant disadvantages from both United States and Panamanian
Route 14 has the military advantage of being in practically the same location as the
Panama Canal for which all existing defense installations have been sited, but there are two
disadvantages to Route 14 from the defense viewpoint: the vulnerability of the existing
canal during the construction period to interruption by slides or by military attack would be
greater than at present, and there would be many miles of barrier dams to defend along each
side of the sea-level canal across Gatun Lake.

Route 10 Conventionally Excavated Sea-Level Canal
Route 10 (Figure 39) is approximately 10 miles to the west of the existing Panama
Canal. With the exception of two short reaches across arms of Gatun Lake, the route lies
outside the present Canal Zone. The area is undeveloped except for a few small farms and
grazing lands interspersed with jungle. The proximity of the Canal Zone would permit use of
existing Panama Canal facilities in support of canal operations.
An analysis of possible sea-level canal configurations on this route leads to three distinct
alternatives, each of which would be 36 miles in length between two double-lane approach
channels 1400 feet wide and 85 feet deep (Figure 40). Listed in ascending order according
to capacity and cost, they are:
A single-lane channel for the full length of 36 miles.
An 11 mile single-lane channel on each end connecting with a 14 mile centrally
located bypass section consisting of two single-lane channels.
Two parallel 36 mile single-lane channels separated by a berm.
This order is also the sequence in which the canal could be constructed to provide
progressively greater capacity. The ultimate capacity would be reached by extension of the
bypass across the Isthmus, providing two parallel one-way channels.
A combination of conventional excavation techniques would be used. A system of
barrier dams would be employed to isolate the construction area from Gatun Lake and the
present canal and thereby permit excavation in the dry of the bulk of the material.
Table 17 gives the capacity-cost data for the single lane configuration.
Prism design and ship spacing have been based on operating in 4-knot currents, but the
Commission considered it prudent to base initial capacity calculations on tidal currents
being limited to 2 knots and to incorporate into conceptual designs and cost estimates the
facilities required for that purpose. The installation of a tidal control structure at the Pacific
entrance and another 25 miles north thereof in the basic one-way channel would accomplish
this purpose and permit more than 35,000 transits per year.
Past negotiations indicate that a sea-level canal on Route 10 should be acceptable to
Panama under reasonable treaty conditions. The precise treaty provisions can be determined
only by further negotiation, but the objectives of the United States and Panama in any canal
on Panamanian territory do not appear to be irreconcilable.
Construction of a canal on Route 10 would not bring about any shift of canal
operations from near Panama's metropolitan centers. The avoidance of interference with
traffic during the construction phase and the preservation intact of the existing canal after a



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(2 LANE) (2 LANE)

(2- LANE) (2 -LANE)






Total construction cost $2,880,000,000
Channel excavation volume 1,870,000,000 cubic yards
Channel excavation cost $2,030,000,000
Construction time 14 years (includes 2 years for
preconstruction design)
Operation and maintenance cost $57,000,000/year (for 35,000

These data are based on construction and operation of a sea-level
canal with a 36-mile single-lane land cut and 17 miles of two-lane
approach channels. Ships up to 150,000 DWT could be accommo-
dated under all conditions; larger ships up to 250,000 DWT could be
accommodated under controlled conditions. Tidal gates would be
installed and used continuously to limit current to no more than
2 knots.

This configuration would have an effective capacity of 38,000
transits/year. At this capacity, the time lost by a ship in slowing
down, forming into a convoy, passing through the canal, and
regaining open ocean speed would be comparable to time lost by
a ship passing through the Panama Canal in 1970. At lower traffic
levels, time lost would be significantly less.

If experience showed that additional capacity would be required on
this route, a 14-mile bypass would be constructed for about
$460,000,000. It would have an effective capacity of 56,000
transits/year and, at all levels of capacity, would allow less
time in transit than a single-lane canal.

new canal is opened would have distinct advantages for Panama. Construction of a canal on
Route 10 would permit future operation of the existing canal in combination with the
sea-level canal and leave Route 14 available for construction of a second sea-level canal if
one were ever needed.
While the advantages for Panama in either a Route 14 or a Route 10 sea-level canal
should make either acceptable under a mutually satisfactory treaty arrangement, the
comparative advantages and disadvantages on balance favor Route 10. In any arrangement
for operation of a sea-level canal on Route 10, it would be unacceptable for the present
canal to pass to Panamanian control and be operated in competition with the sea-level canal.
The Stanford Research Institute's study of sea-level canal economic impacts estimated
that the maximum reduction in canal employment for a sea-level canal on Route 10, in
comparison with continuing the present lock canal, would be 6,300 employees. On the

other hand, more than 7,000 employees would be needed during the sea-level canal
construction period. The foreign exchange earnings for Panama from sea-level canal
construction, estimated to be more than $1 billion, plus the greater long-term earnings from
the new canal capacity, would permit greater total economic development and employment
in Panama than continuation of the existing canal. The Stanford Research Institute
estimated that the gross domestic product (GDP) and total employment in Panama would
not only grow rapidly during the sea-level canal construction years but also would thereafter
continue to be greater than it would be were the present canal continued under the existing
treaty (Annex I).
One disadvantage of Route 10 is that it lies outside the existing Canal Zone.
Construction on it would require acquisition of some privately owned land, but the needed
land is relatively undeveloped and its acquisition should involve no significant problems or
cost. The question of jurisdiction in the canal area is not material to the choice of sea-level
canal routes in Panama, inasmuch as a new treaty is expected to be negotiated for
construction on any route. Resolution of the issues of Panamanian sovereignty and
jurisdiction of the canal operating authority should affect all routes equally.
Defense of a sea-level canal on Route 10 would require only limited expenditures for
new defense facilities, such as helicopter landing areas, access roads, and facilities at the
canal entrances for small Navy elements. The additional distance to Route 10 is so small
that all major defense requirements would continue to be met by existing military
installations in the Canal Zone. Not only would a sea-level canal on Route 10 be far less
vulnerable than a lock canal, but also it would be somewhat less vulnerable than one on
Route 14 with its more extensive barrier dams needed to preserve Gatun Lake.
The distance of Route 10 from the metropolitan centers of Panama City and Colon is a
slight military advantage, but continued use of existing Zone facilities in support of a canal
on Route 10 would leave many facilities and canal personnel in the same location regardless
of the choice of Route 10 or Route 14.
The major military advantages of Route 10 over Route 14 are that construction on
Route 10 would avoid the long period of vulnerability of the existing canal during
construction of a sea-level canal adjacent to it on Route 14, and the additional capacity and
safety offered by the continued availability of the old canal after a new one is opened on
Route 10.

Route 10 Sea-Level Canal Operated in Combination with the Existing Lock Canal as
One System
The present canal would continue in operation during the construction period of any
sea-level canal. When the sea-level canal is opened, the existing canal would be needed to
provide an emergency alternative until the new canal had been operated for a period of
years, its capabilities proved, and there was reasonable certainty that it would not be
seriously affected by slides. The Commission has been advised by its Technical Associates
for Geology, Slope Stability, and Foundations that 10 years is a minimum period for this
purpose. It would be desirable also to maintain it on a standby basis for an extended period
The existing canal with improvements short of additional locks has, as previously been
indicated, a potential annual transit capacity of 26,800 ships of all sizes below 65,000 DWT.

Farmland on southern portion of Route 10

In the mix of ships projected for Isthmian canal traffic in the year 2000 and thereafter,
more than 85 per cent of the total continues to be in these smaller sizes. Although the
combined capacities of the old canal and a sea-level canal on Route 10 are not likely to be
needed in this century, it would be unwise for the United States to commit itself to discard
the old canal permanently until the lack of ultimate need for it was certain.
There are no unique engineering problems in maintaining the lock canal on a standby
basis. The cost of operating it on a one-shift basis after a new canal is opened is estimated to
be approximately $4 million a year. This amount would provide for personnel for
maintenance and operation, dual training of sea-level canal operating personnel for lock
canal operations in an emergency, and periodic channel dredging. When no longer needed,
maintaining it on a non-operating standby status is estimated to cost $1 million a year.
Integration of the operation of a new canal on Route 10 with operation of the existing
canal would have great advantages over operation of a canal on Route 10 as a separate
If a new treaty should authorize such a system, all feasible alternatives for providing
canal capacity greater than now existing would be available. Initial expansion could be
accomplished by adding lock lanes to the existing canal or by building a sea-level canal on
Route 10. Subsequent needs in excess of the minimum capacity of the sea-level canal could
be met in three different ways:

1. Reactivating the existing lock canal,
2. Providing a bypass on Route 10, and
3. Constructing a second sea-level channel either along Route 10 or generally along
the trace of the existing canal (Route 14).

Reactivating the lock canal would permit a total of at least 60,000 annual transits;
addition of a bypass to the sea-level channel on Route 10 would permit approximately
56,000 annual transits; Route 10 with a bypass in combination with the existing lock canal
would permit at least 80,000 annual transits; a second sea-level channel would permit well in
excess of 100,000 annual transits.
This flexibility in future canal possibilities, providing as it would maximum transits and
other economic benefits, would be as advantageous to Panama as to the United States. Such
a system should be welcomed also by all canal-using nations as indicative of the intent of the
United States and Panama to ensure adequate canal capacity indefinitely.
The Stanford Research Institute's evaluations of the economic impacts of various
sea-level canals showed that the combined operation of the old and new canals would be the
most beneficial to Panama of all the plans considered. Appropriate Canal Zone facilities
would continue to be used by the canal system operating authorities to administer and
support canal-system operations and the Canal Zone military bases would continue in
essentially the present status for defense. In addition, however, maintenance of the old canal
in service, or even on a standby status, would create, directly and indirectly, more jobs for
Panamanians than would a sea-level canal on Route 10 alone and would generate greater
foreign exchange earnings for Panama.
Adoption of the system concept would not foreclose relinquishment to Panama of
excess Canal Zone properties such as contemplated in the 1967 draft treaties. Zone water
resources, unneeded facilities, and excess land areas that could be made available to Panama
were a sea-level canal operated alone on Route 10, would be almost equally available were
the channels and locks of the existing canal maintained for reactivation when needed.
The defense advantages of a sea-level canal on Route 10 have been discussed above.
These advantages would be somewhat greater in the canal system as envisioned because the
present canal would be useful if the sea-level canal were blocked. Defense of the standby
canal should cause no major additional problems. The existing military bases are already
suitably sited, and the forces planned for the defense of Route 10 could, with acceptable
risks, provide protection for the standby facilities. In periods of increased tension, defense
forces could be augmented as necessary.



The financial feasibility of the sea-level Isthmian Canal is dependent on a number of
variables, none of which can with confidence be assigned a value. The Commission had to
consider a range of values for some and make reasonable assumptions for others as described
in this Chapter. Detailed discussions of these matters and financial analyses of sea-level canal
arrangements and the third-locks alternative are contained in Annex III, Study of Canal
Finance. The discussion in this Chapter is directed primarily to the financial feasibility of
construction of a sea-level canal on Route 10 that would be operated in conjunction with
the existing Panama Canal as a single system.

Considerations for Financial Analyses
Revenues expected from tolls on a sea-level canal at current toll rates and the maximum
potential under an increased toll schedule are summarized in Table 18:


Millions of Dollars

Potential Tonnage Low Growth
Forecast Forecast

Current Maximum Current Maximum
Fiscal Year Tolls Tolls Tolls Tolls

1990 205 287 185 259
2000 290 406 215 301
2010 391 546 235 329
2020 500 700 264 370
2030 577 811 282 392
2040 605 847 313 440

Costs of Operations
The Panama Canal Company and Canal Zone Government now conduct many
revenue-producing activities not directly connected with operating and maintaining the
canal. The costs of these operations taken together approximately equal their total revenues.
Government functions, such as police and education, are financed from general revenues.

In estimating the operating costs of a sea-level canal, the Commission included only
those activities directly associated with canal operation and maintenance, including
administrative overhead. Commercial and government activities were assumed to be neither
a cost nor a source of revenue in sea-level canal operations.
Payment to Host Country
The unratified 1967 draft of a treaty with Panama for the continued operation of the
present canal would have replaced the 1955 Treaty provision for a fixed $1,930,000 annuity
to Panama with royalty payments for each long ton of cargo transported through the canal.
The draft suggested that the royalty payment start at 17 cents per long ton of cargo and rise
1 cent annually for 5 years to 22 cents per long ton, at which level it would remain. This
1967 plan has recently been rejected by Panama and is in no way binding upon the United
States. The Commission, however, used, for purposes of comparison, the suggested royalty
payments as one possible compensation arrangement in estimating the total cost of
operating a sea-level canal in Panama.
The level of host-country compensation that might be required for a canal in Colombia
cannot be established until the United States is prepared to discuss detailed canal treaty
terms with the government of that country. Meaningful estimates of the operating revenues
of a sea-level canal in Colombia require assumptions as to what use would be made of the
existing canal subsequent to the opening of the new canal. The Commission could find no
basis for such assumptions and hence was unable to make a financial analysis of a sea-level
canal on Route 25, except to recognize that competition by the existing Panama Canal
could make it impossible for the new canal to meet operating costs and debt service charges
from revenues.
The inflation of costs over time is an established trend that cannot be disregarded in
financial analyses of prospective sea-level canals. Maintenance of the Panama Canal tolls at
the same dollar level for more than a half a century was made possible only by political
decisions that reduced costs funded from tolls. Similar decisions could be made in financing
a new canal, but they were not assumed in developing the financial analyses in Annex III,
Study of Canal Finance.
A self-amortizing sea-level canal would require provisions in its financial plan to
compensate for the effects of inflation. However, reliable estimates of the effects of
inflation on costs and revenues for a 75-year period into the future are not possible;
attempting to incorporate them would not add to the validity of the financial analyses. The
conclusion was reached in the evaluation of the toll revenue potential of a sea-level canal in
Annex IV, Study of Interoceanic and Intercoastal Shipping, that costs of alternatives to
using the canal will tend to increase in parallel with increases in canal costs, and tolls could
be increased in proportion without discouraging traffic growth materially. Therefore, the
assumption was made that future tolls would be increased periodically in proportion to
inflation of costs. All estimated costs and revenues, therefore, are stated in 1970 dollars.

Construction and Amortization Periods
Estimated construction periods vary only slightly among canal routes, but estimates of
the time required for negotiations with the host country and the passage of appropriate