Message from the Panama Canal Authority Administrator/CEO
2008 has been a year of great accomplishments for the Panama
Canal Authority (ACP). We are moving forward with the Canal
expansion, the largest infrastructure project in Latin America,
which will double the waterway's capacity within the next six years,
allowing for the passage of vessels up to 49 meters (160 feet)
wide, 366 meters (1,200 feet) long and 15 meters (50 feet) deep,
with a maximum cargo volume of 170,000 DWT or 12,600 TEUs.
Five Major Multilateral Development Agencies to Finance the
At a time of global economic and financial uncertainty, five major
multilateral agencies, from different regions of the world, showed
their confidence in Panama and committed to finance $2.3 billion
of the $5.25 billion project. The financing package was negotiated
with the European Investment Bank (EIB), Japan Bank for
International Cooperation (JBIC), Inter American Development
Bank (IDB), International Finance Corporation (IFC) and
Corporaci6n Andina de Fomento (CAF). It includes a 20-year
amortizing period with a 10-year grace period.
Expansion Program Moving Forward On-Schedule and
The Expansion Program's execution is moving forward as
planned, on-time and on-budget. Currently underway the dry
excavation project consists of four phases that will remove 46
million cubic meters of material and will ultimately lead to the
creation of the new 6.1 kilometers long Pacific Access Channel
(PAC). Phases one and two are being performed by Constructora
Urbana, S.A. and Cilsa Minera Maria, which are tasked with the
removal of 7.4 million and 7.5 million cubic meters of material,
Third Dry Excavation Expansion Project
The bid opening ceremony for the third of four dry excavation
contracts under the Canal Expansion Program took place on
December 4. Six bidders participated in the process and
presented the following price proposals:
2. Constructora Santa Fe, Ltd.
3. Corporaci6n M&S Int.
4. Constructora Urbana, S.A.
5. Constructora Meco, S.A.
6. Cilsa Minera Maria
Similar to the first and second dry excavation projects, this
contract will be awarded to the firm with the lowest-priced bid that
meets all of the requirements in terms of experience, technical
capacity, financial strength and bonding stated in the request for
Excavation for the Navigation Channel Continues
The dry excavation work began in September 2007 with the
blasting of 32,000 pounds of explosives in Paraiso Hill and
continues to advance at a very fast pace. The Hill, located north
of the Pedro Miguel Locks, is rapidly disappearing and the south
end has already reached the final elevation of 46 meters required
in the contract. The third phase of dry excavation will further
reduce the Hill to 27.5 meters. The work includes the excavation,
removal and disposal of 8 million cubic meters of material and the
clearing of 190 hectares of munitions and explosives of concern
(MEC), remnants from former U.S. training facilities in the Canal
Dredging of the Pacific Sea Entrance
Dredging International (DI), a Belgium-based company, was
awarded the contract for the dredging of the Pacific sea entrance
for $177.5 million. DI already has its Vlaanderen XIX cutter suction
dredge positioned in the area and the work began November 17.
When the expansion concludes, the Canal's approximate 9
mile-long (14 km) navigation channels will be widened to a
minimum of 225 meters (738 feet) and deepened to a minimum
level of 15.5 meters (51 feet) below the Mean Low Water Springs
Internationally Renowned Consultants Provide Inputs
The program's implementation is being overseen by a number of
internationally renowned firms including program manager CH2M
Hill; financial advisor Mizuho Corporate Bank, Ltd.; financial legal
advisor Shearman & Sterling LLP; contract legal advisor Mayer
Brown; and insurance broker British Willis Limited.
Expansion Program Receives Awards
Due to its importance to world trade, the Canal expansion was
honored in 2008 as the "Best Long Term Performance Project"
and "Strategic Project of the Year" by the 6th Annual CG/LA
Infrastructure Latin-American Forum, as well as the "Most
Significant Project in the World" by Samoter International. These
recognitions have been a source of pride, as they are a tribute to
the ACP's contribution to innovative construction development on
both national and international levels and its strategic vision.
Environment Takes Priority
As the expansion project unfolds, the ACP continues to take
special care at its work sites to protect the wildlife of the area.
Wildlife rescue plans are prepared by contractors and approved
by the National Environmental Authority before forest areas are
cleared. Traps are placed in the areas where vegetation will be
affected to rescue animals that are unable to move by
themselves. So far, nearly 396 animals have been rescued,
examined and relocated to protected areas near the Canal. More
than 145 hectares have been reforested at national parks with the
coordination of the Panamanian Environmental Authority and
another 270 hectares are scheduled for reforestation during
Dry excavation work continues on new navigational channel.
Onwards to 2009 Expansion Continues Apace
In 2009, we will award the contract for the design and
construction of the new locks. Four international consortia
composed of world-class engineering firms from Spain, Germany,
Great Britain, the Netherlands, France, Brazil, the United States,
Japan, China, Belgium and Panama -are competing for this
contract, which represents the largest portion of the program. The
deadline for the final submissions of proposals has been extended
to March 2009 to provide the consortia with additional time to
present more fully developed bids, from both the technical and
In the interim, the ACP continues to invest in improving the
existing Canal, offering a safe, reliable and efficient service to all
our customers. This year, we revamped our transit reservation
system to provide additional booking slots and more flexibility in
the process. All these efforts will guarantee that we continue
offering the best shortcut between the Atlantic and Pacific Oceans
and the best service to shippers worldwide!
Alber o Alenn Zubieta
Panama Canal Authority Tel. (507) 272-7961
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