What's Going On With the Panama Canal Expansion?

 In Panama Canal, Panama Canal Expansion,

Whats_Going_On_With_Panama_Canal_Expansion-2.pngJorge Quijano, Administrator and CEO of the Panama Canal Authority (ACP), released an awfully cheerful statement, published by the American Journal of Transportation (AJOT). It opens with:

“As the new year begins, I find myself reflecting on 2015 with a great sense of pride in our accomplishments and with much anticipation for the year ahead when we will inaugurate our Expanded Canal.”

Yes, the much anticipated Panama Canal expansion should be completed this year. Of course, despite the cheerfulness of Quijano’s words, the expansion project has not been like walking through a beautiful rose garden. Unless you were barefoot and bleeding, trying to climb your way out of a thick patch of rose bushes with its thorns tearing into your flesh. Yeah, that sounds more like the way the Panama Canal expansion has proceeded.

Quijano did admit in his statement that “the past year was not free of challenges…” Of course, he quickly followed that with “we have taken corrective measures to address them [the challenges]…” He also personally reassures us all “that work continues to complete the new locks with the quality established in the contract and to the standards customers are accustom to and expect.”

With all the delays and leaking locks, I’m not sure the standards customers are accustomed to and expect when it comes to the Panama Canal expansion are all that positive, Mr. Quijano.

But things have gotten better, right? Well…

Let’s take a look at what’s going on with the Panama Canal expansion.

Criminal Investigation

You know what the mess known as the Panama Canal Expansion Project could really use? A legal battle.

Going all the way back to how Grupo Unidos por el Canal (GUPC) landed the Panama Canal expansion contract, things with the consortium have looked shady. The consortium is not looking any better as a criminal complaint has been filed against it in connection with, of course, the expansion project.

The Costa Rica Star reports:

The consortium responsible for the main Panama Canal expansion project is the subject of a criminal complaint in the Central American country for allegedly inflating its cost overrun claims.

“We’re asking for an investigation into the possible defrauding of the nation’s resources” through the presentation of “unjustified” economic claims by the GUPC consortium, led by Spanish construction company Sacyr Vallehermoso, [National Bar Association Vice President Juan Carlos Arauz] told EFE Friday.

The drama between the GUPC and ACP has become downright embarrassing. Speaking to the nation, Panama’s president, Juan Carlos Varela had to address the situation, calling on the consortium to focus on the work of finishing the expansion over the legal battle. 

The Associated Free Press (AFP) quoted him in an article published on Yahoo! News.

“With respect, I am calling on the contractors for the expansion project to hold dialogue with the Panama Canal Authority, to allow work to be completed, to leave legal disputes in the hands of the competent authorities and to avoid mediatized differences that in no way help the image of the contractors, the Canal Authority and the Republic of Panama,” Varela said.

If GUPC does not heed President Varela’s words, we could be seeing even more delays to the expansion’s completion.

Expansion Completion Pushed Back Again

Speaking of delays, in President Varela’s address, he also let it slip that the Panama Canal completion date has been pushed back. Again.

AFP quoted him as saying the Panama Canal expansion will be completed “around the month of May”.

At least this is only a month later than the previous completion projection of April 2016, as opposed to a full year from the prior projection of April 2015, which had been pushed back from October of 2014.

We could look at this thing positively and say April is around the month of May and therefore there is no delay. Probably the only one who can make such positive statements about the expansion’s completion is Jorge Quijano.

What exactly does “around the month of May” mean? June is around the month of May. And heck, “around” is such a subjective term that July or even August could be in play here.

Whenever the Panama Canal expansion does finally get completed, it will be inaugurated in the second quarter of this year.

American Shipper reports:

The Panama Canal Expansion will be ceremonially “”inaugurated by the second quarter of 2016, with commercial opening to follow shortly there after,” according to Jorge L. Quijano, the Panama Canal Authority (ACP) administrator and chief executive officer.

Inauguration and opening the expanded canal are two separate things?

See, that’s funny because I thought inaugurate meant to commence or launch something, especially for public or commercial use. Maybe the term means something different in Panama. Wait, a government launching something before it’s finished and ready? I take it back. That makes perfect sense.

At least we are, at last, getting close to the end of this farce. There is only a little bit of doubt that the Panama Canal expansion will be finished this year. The American Shipper article goes on to share how close the completion is according the ACP.  For symmetry, we’ll end this blog with the cheerful words of Quijano:

“The work achieved thus far in the expansion program has been significant, and it is now 96 percent complete,” Quijano wrote in the January edition of the agency’s Canal Connection newsletter.

He said reinforcement of the lock sills by the GUPC consortium building the canal “will be completed this month.”

Related Reading

Big Backups at Panama Canal Spur Action

A Little Mistake Cost the Panama Canal Expansion Big Time

Shippers’ Questions: What’s Going On With This Canal Thru Nicaragua

Click Here for Free Freight Rate Pricing


Source: UC Blog

Leave a Comment

Panama Canal Risky