Title: Panama Canal Customer newsletter
Full Citation
Permanent Link: http://ufdc.ufl.edu/UF00099413/00002
 Material Information
Title: Panama Canal Customer newsletter
Physical Description: Serial
Language: English
Publisher: Autoridad del Canal de Panama
Place of Publication: Balboa, Panama
Publication Date: March 2000
 Record Information
Bibliographic ID: UF00099413
Volume ID: VID00002
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.


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On February 22, the Canal Administra-
tor addressed the Panama Canal Sympo-
sium at the Hilton Hotel in New Orleans,
Louisiana. His presentation touched on
the recent transfer of the waterway by
the United States to the Republic of
Panama, and current and future im-
provement and modernization programs
being undertaken or planned by the
Panama Canal Authority to provide the
highest quality of transit service. He
also outlined the various studies that are
actively underway in connection with
the planned construction of the third set
of locks.

The event was sponsored by the World
Trade Center of New Orleans and it was
produced and organized by the Journal
of Commerce Group (JOC). Mr. Will-
iam Ralph, President of the JOC provided
the welcoming remarks and Panama's
Ambassador to the United States,
Guillermo Ford, delivered the keynote
address. Other speakers included: James
Benson, Panama Desk Officer, U.S. State
Department; Greg Stangel, Vice Presi-
dent Marketing, Intermarine; Mike
Haverty, President and CEO, Kansas City
Southern Lines, which has the conces-
sion in Panama for the Panama Canal
Railway Company to rehabilitate the
Panama railroad; Christopher Davis,
Partner Phelps Dunbar LLP and David
Robles, Partner, DeCastro & Robles, who

The Panama Canal Authority will be par-
ticipating in the Posidonia International
Shipping Exhibition to be held in Piraeus,
Greece. The Canal plans to have an
exhibit which will be jointly sponsored
by other entities in Panama, including
the Panama Maritime Authority and the
Interoceanic Regional Authority. The
conference will be held June 2 9. More
information is available at the following
Internet Web-site www.posidonia-

gave legal perspectives; Gilberto Chona,
Country Economist and Coordinator for
Panama, Inter-American Development
Bank; and C. Thomas Burke, Assistant to

the President, K-Line America and for-
merly Commissioner of the Panama Ca-
nal Study Commission, U.S. State De-

From left to right: James Benson, William Ralph, Ambassador Guillermo Ford, Alberto
Aleman Zubieta and C. Thomas Burke posed for a photo shortly after the first session.

Officials from the shipping line CMA-CGM
disclosed plans to begin providing a new
all-water service between Asia and the U.S.
East Coast via the Panama Canal. CMA-
CGM officials were in Hong Kong during
the second week of March, discussing the
final details forthe initiation of the new ser-
vice. They were accompanied by a repre-
sentative from the French Shipping Agency
in Panama who represents the line at the
Panama Canal.

The first vessel should sail from the Far East
in early April and transit the Panama Canal
around April 23. The service rotation will
be Pusan, Shanghai, Yantian, Hong Kong,
Keelung, Panama, Kingston, New York,
Norfolk, Savannah, Panama and back to

A weekly service is contemplated with two
vessels transiting the Canal and working
cargo in Panama every week, with one in
the southbound direction and the other

The Canal administration was very pleased
with CMA-CGM's announcementto deploy
its vessels via the waterway. CMA, a pri-
vately owned line based in Marseille,
France, bought out CGM, which is based
in Paris and was formerly owned by the
French government, thus transforming
CMA-CGM into a major global carrier.
CMA-CGM has developed agreements with
the China Shipping Group, based in Hong
Kong, to further broaden its service and

Mr. Rodolfo Sabonge, Director of Corpo-
rate Planning and Marketing for the Panama
Canal Authority has been invited to address
two important maritime related conferences
in April and May 2000. Atthe EXPO 2000
Intermodal conference, Mr. Sabonge, will
participate, along with three other promi-
nent panelists, in a "town meeting" style
discussion moderated by Theodore Prince,
Senior Vice President for Sales & Market-
ing at Kleinschmidt, Inc. The discussions
will focus on a wide variety of transporta-
tion issues including the Panama Canal,
railroads, trucking, ports and terminal op-
erations and regulatory matters. This con-
ference is organized by the Georgia Freight
Bureau, Inc. and the Intermodal Associa-
tion of North America and it will be held at
the World Congress Center in Atlanta, Geor-
gia, from April 11-13, 2000. More infor-
mation concerning this event can be ob-
tained by calling (404) 524-7777.

At the Terminal Operations and Shipping
Conference (TOC 2000) in Rotterdam, Mr.
Sabonge will discuss the advantages of the
all-water route through the Panama Canal,
the future of the waterway after the hand-
over, and he will highlight Panama's prime
geographic and strategic position as a ma-
jor trade and transshipment hub. Other
confirmed speakers from Panama for this
event will include Mr. Carlos Urriola, Vice
President of Marketing for the Manzanillo
International Terminal and David Starling,
President, Panama Canal Railway Com-
pany. The event will be held from May
16-18 and it will include presentations,
workshops and exhibits. More information
regarding the conference and the latest list
of speakers can be obtained by visiting the
TOC web site at www.toc-iirx.com.

Pierce Brosnan, well known as James Bond,
arrived in Panama in March, along with
Jamie Lee Curtis and Geofrey Rush, to be-
gin filming a movie based on the novel, "The
Tailor of Panama" by John Le Carr6. The
Panama Canal cooperated with the produc-
ers by providing support and assistance in
the production of the movie as some por-
tions of the movie will feature scenes of the

Gaillard Cut Widening
The accelerated Gaillard Cut Widening
Program continues on schedule and is ap-
proximately 83% completed. Project en-
gineers report that dry excavation which
is about 91% complete, and overall wet
excavation which is 73 % complete and
91.8% of all drilling and blasting opera-
tions have been accomplished. As a re-
sult of the Cut Widening Program, a new
longer vessel Tie-up station is under con-
struction on the west bank of Gaillard Cut,
just north of Pedro Miguel Locks, and that
project is scheduled to be completed in
June 2000. Once this new facility be-
comes operational it will replace the existing Paraiso vessel Tie-up station, which was
already scheduled for removal as part of the Cut Widening Program.

Vessel Traffic Management
The Enhanced Vessel Traffic Management System (EVTMS) went into service in December.
The following month, the new CTAN (Communications, Tracking, and Navigation) be-
came operational. CTAN provides the user with a new, powerful tool improving quality,
efficiency, and safety of vessel transits. Position accuracy is enhanced via the use of differ-
ential Global Positioning System (DGPS). As a result, the screens in the Marine Traffic
Control Center, as well as the ones in all supporting units, have a complete and updated
map of the location of all vessels and floating equipment, with the same view available to
pilots on their laptop computers. The first and most important phase of the EVTMS is now
fully operational. The system is being used in the Canal's daily operations, including
vessel and pilot scheduling, as well as billing. Fine-tuning of the system is now underway
by following up on recommendations received from the end users and increasing response
speed and reliability in some applications. The use of specialized modules is now being
evaluated to increase the benefits of this investment by adapting the system to multiple
situations that arise during the daily use of the system.

New Locomotives
During January, the 8 prototype electric locks towing locomotives began operating around
the clock and completed numerous lockages. These new locomotives are faster and more
efficient than the earlier models and they are designed with fewer moving parts to reduce
maintenance intervals, down time and costs. Operational trials will be ongoing through
May of this year to identify any modifications that may be required to the new locomotives.
When the prototypes are accepted by the Canal, an agreement will be made for the modi-
fications required on the production units, and the Canal Authority will give the order to
proceed with the manufacture of 18 additional units.

Rehabilitation of Locomotive Tow Track
More than ten thousand feet of locks locomotive tow track have been rehabilitated repre-
senting a 20% completion of the
project. The entire project calls for
the rehabilitation of more than
53,000 feet at all locks. The tracks
are being upgraded to withstand the
greater stress load that is being ex-
erted on the tow track. We are cur-
rently involved in the process for the
pre-demolition and manufacture of
steel sections. Installation should be-
gin on May 15, 2000.

-~~--~''''~''''~--' --'-- '''''

M fi'ihwmmm

The Canal is continuing its efforts to reduce lockage and vessel transit time by replacing
old or worn machinery and controls systems with new more reliable equipment, thus
increasing the Canal's overall capacity. Miter gate machinery, and the controls that acti-
vate the gates and other locks machinery, is undergoing replacement with new state-of
the-art equipment. Much of the machinery and all of the manually controlled systems
within each lock chamber are original, electromechanical and were built in-place during
Canal construction. This original equipment, which is showing signs of wear and fatigue,
is experiencing increasing failure from decades of use resulting in more frequent mainte-
nance intervals which produce traffic delays. Consequently, the strut arms for the miter
gates are being re-
placed with more
reliable and eco-
nomical hydrauli-
cally activated
equipment that has
fewer moving parts,
works smoother
and more effi-
ciently, and re-
quires less mainte-
nance and down
time. The manually
operated machin-
ery control panels
are also being re-
placed with a new
computerized sys-
tem to improve Newly installed hydraulically activated strut arm.
safety, reduce
maintenance levels and expedite the lockage process. Canal customers will benefit from
these improvements through a reduction in average lockage time.

The strut arm project involves the replacement of 80 strut arms distributed among the
three locks. As of this date, 12 hydraulic strut arms have been installed at the Pedro
Miguel Locks and are fully operational, and two others are undergoing installation. Simi-
lar work at the Miraflores Locks is scheduled to begin in April 2000 and should be com-
pleted during fiscal
year 2001. Follow-
ing this work, strut
arm replacements
will begin at Gatun

The electronic con-
trols have already
been successfully
implemented at
Pedro Miguel Locks.
The improvements at
Gatun Locks will be
carried out during the
fiscal year 2000
2001, to complete
this three-year con-
version program, at
an estimated cost of
$16 million.

The Panama Canal
will participate with a
display integrated into
Panama's country ex-
hibit at the EXPO 2000 World's Fair in
Hanover, Germany. The theme for the Fair
will be "Humankind-Nature-Technology".
As the Canal relies on natural rainfall to
supply the fresh water needed to provide
passage to more than 14,000 vessel tran-
sits and over 200 million long tons of cargo
annually, the display will highlight efforts
for the management and protection of wa-
ter resources and the Canal's watershed.
The display will also demonstrate the com-
plexity of these efforts and the exploration
of new water sources since the same reser-
voirs supply the ever-increasing demand
for potable water, hydroelectric power, and
irrigation water in the metropolitan areas
adjoining the Canal. It will also identify
the expanded watershed that will be
needed for the planned construction of a
third set of locks to expand Canal capac-
ity. Other features of the display will in-
clude the application of new technology
in the operation of the waterway, and the
important service the Canal provides to the
world through the efficient, economical
and environmentally friendly movement of
world trade for the benefit of all mankind.
The Fair will be open from June 1 through
October 31, and it promises to be the larg-
est World's Fair in history. More informa-
tion may be obtained about the Fair at the
following Internet web site:


Mr. William A. O'Neil, Secretary-General
of the International Maritime Organization
(IMO) and Mr. Jerry Salazar, Administrator
of the Panama Maritime Authority visited
the Canal's exhibit presented at Panama
Maritime V, which was held in Panama on
February 23 to 25.

Commercial Transits by Major Ship Types The trend toward larger vessels contin-
(October February) ues at the Panama Canal in spite of what
Vessel Type appears to be a temporary decline in to-
Stal transit levels for October through Feb-
Tankers ruary of fiscal year 2000. Average ves-
Refrigerated Cargo sel size rose 4.6% during that period,
Passenger with the number of Panamax-size ves-
General Cargo sels increasing from 1,789 last year to
Container Cargo increasing 1,789 year
Bulk Carrier Car 1,811 this year for the same five-month
Bulk Carriers period.
400 800 1,200 1,600 2,000
No. Transits With regard to transits, preliminary data
indicates that oceangoing commercial
*FY 1999 g FY 2000 .
transits totaled 5,227 or 34.4 daily for
the first five months of fiscal year 2000, compared to 5,517 or 36.5 per day for the same
period the prior year. As the bar chart shows, most major vessel types reflected declines.

When analyzing the trades, the first part of fiscal year 2000 was characterized by the
continuous increase in international oil prices, as the agreement to cut supplies among
OPEC countries remained through the month of March. This decision impacted negatively
on transportation costs, mainly freight rates, ultimately causing a change in some trades
through the Canal. Cargo levels during the first four months of fiscal year 2000 totaled
64.1 million long tons, a reduction of 6.4 percent with respect to the 68.5 million long tons
registered for the same period the prior year. Some commodities that showed negative
results for the period of October through January 2000 were crude oil and oil products,
coke and coal, phosphates, fertilizers, and manufactures of iron and steel. In addition, the
flow of grains, the largest and one of the most volatile commodity groups passing through
the Panama Canal, registered a 16.4 percent decline during the first four months of fiscal
year 2000. The reduced flow of corn from the East Coast of the United States to Asia, the
main commodity within the grains group, was caused by competition from China. Some
commodities that helped to offset these declines in cargo tonnage were containerized
cargo, chemicals and petrochemicals, lumber and products, and refrigerated foods.

As of January 2000, cargo flows through the Panama Canal were showing signs of recov-
ery overall. Grains reflected a 10.7 percent increase for the month of January and there is
strong speculation that OPEC countries may end their freeze on oil production by the end
of March.

May 15 to 26 (12 days)
Rehabilitation of 1,540 ft of locomotive track on West sidewall and centerwall .
Maintenance of miter ates.
April 24 to May 26 (29 days)
Centerwall culvert outage for inspection and replacement of 10 cylindrical valves.
June 12 to 24 (12 days)
Rehabilitation of 1,540 ft of locomotive track on East sidewall and centerwall.
East lane dry chamber; maintenance of miter gates.
July 17 to 29 (10 days)
East lane dry chamber.
Rehabilitation of 1,400 ft of locomotive track on East lane upper and lower level
August 21 to 31 (10 days)
Rehabilitation of 1,400 ft of locomotive track on West lane sidewall & centerwall.
September 18 to 19 (2 days)
Maintenance of East miter gates.
September 20 to October 1 (12 days)
East lane dry chamber; maintenance of miter gates; rehabilitation of 400 ft lower
level locomotive track.
September 30 to October 1 (2 days)
Rehabilitation of 760 ft of locomotive track on West lane sidewall lower level
Customers can stay informed as to the nature and impact of these projects on transit capacity, or changes in the schedule by accessing the
Canal's internet web site at: www.pancanal.com and then clicking on the "Manritime Operations" icon.

Mr. Juergen Dorfmeier, President of the
Panama Chamber of Shipping recently an-
nounced the appointment of Ms. Anna Maria
Sanfilippo to the newly established position
of Executive Director. Ms. Sanfilippo previ-
ously worked for Panama's National Port
Authority, where she served as director of
marketing and she has over 17 years of expe-
rience in the maritime sector. Mr. Dorfmeier
noted that Ms. Sanfilippo's appointment was
an initial step in the process of shifting the
role of the Chamber to an organization with
a broader membership that is more represen-
tative of the entire transportation sector as
well as other entities which contribute to the
development of Panama. The Chamber also
plans to closely examine its current structure,
bylaws and membership requirements. As
part of its new mission the Chamber will strive
to promote Panama as a major transportation
and trade hub, while also encouraging over-
all economic development and tourism. Mr.
Dorfmeier pointed out that with the transfer
of the Canal to Panama and the constant
changes in the transportation sector brought
about by globalization, deregulation and new
technology, it is necessary for his organiza-
tion to redefine its role in the new millen-

The Chamber was originally created in the
1960's as an informal group of local shipping
agents, which represent many of the shipping
lines that utilize the Panama Canal. Today, it
is affiliated with the International Chamber
of Shipping, based in London, and it is le-
gally comprised of 53 companies. Some of
its members include ports, the railroad, com-
panies involved in the consolidation and stor-
age of containers, and companies that pro-
vide collateral services, such as ship
chandling and tendering, legal services, and
maritime consulting. The Chamber is in the
process of developing a web site on the
internet and they plan to announce the ad-
dress in the next couple of months.

(then click on "Canal News")
We will publish the next issue in May, 2000

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