fbpx

Canal Connection

English version

December

Propelling the Canal ForwardPanama Canal Leaders Share Their 2022 Outlook

This month marks the end of another record-breaking year at the Panama Canal – no simple feat – given the challenges it faced, from global supply chain disruptions to the continued effects of the COVID-19 pandemic on the global economy. Behind the waterway’s uninterrupted service stood a world-class team, who worked tirelessly to ensure the waterway remained safe and prepared for whatever the future may have in store for it next. 

To celebrate the end of the year, Panama Canal leaders were asked to reflect on the waterway’s top achievements from the past year, as well as what they have in store for 2022. 

Operations  

Although global trade began its resurgence in 2021, the Panama Canal kept its operations teams as agile as possible, given the pandemic’s unpredictable impacts on traffic thus far. The team made prompt adjustments to accommodate the unprecedented surge in demand. In February, the Canal modified its transit reservation system and other maritime services to adapt its service and better manage its capacity in the face of fast-growing market conditions. The Canal also began offering an auction booking slot for the Panamax and Neopanamax Locks to help alleviate waiting times and offer additional booking options and flexibility for customers. 

By October, the Panama Canal celebrated a record-breaking year of transits. “Our achievements in 2021 were made possible by our team’s dedication to understanding our customer’s shifting needs. As they shifted, we listened and evolved our service accordingly, while continuing to keep health and safety as a top priority,” said Ilya Espino de Marotta, Deputy Administrator of the Panama Canal. “We look forward to accommodating even more transits for our customers in the New Year, with containership, liquefied natural gas and liquefied petroleum gas transits already expected to drive growth in 2022.” 

Sustainability  

Accelerating the Panama Canal’s transition to carbon neutrality will also be a key priority across the waterway’s teams in the coming year, building off the waterway’s fast-growing sustainability initiatives. In just the past year, the waterway launched its CO2 Emissions Savings Dashboard, a tool for calculating the carbon dioxide (CO2) emissions saved by vessels that transit the Panama Canal, compared to the most likely alternative route, which found that vessels saved more than 13 million tons of CO2 emissions by opting for the Panama Canal route in 2020. 

This past year, the Panama Canal also signed the Call to Action for Shipping Decarbonization with 150 maritime organizations, contributed to the UN Global Compact’s Charting a 1.5 C Trajectory for Maritime Transport, and gave a presentation on sustainable maritime routes at 2021 United Nations Climate Change Conference (COP26).  

In 2022, the waterway will advance its pledge to becoming carbon neutral by 2030, with plans already underway to invest roughly $2.4 billion in modernizing its equipment and infrastructure to meet this commitment. For the operations team, initial next steps include adopting 10 hybrid tugboats, with the option of purchasing another 10, which will reduce tugboat operational carbon emissions by 20 percent. The Canal will also introduce a fleet of electric vehicles, among other measures.  

“Our goal is to begin a series of investments that maximize the value we can offer our community, customers and world as a green route and corridor for world trade,” said Victor Vial, Vice President of Finance. “By fortifying our infrastructure, technology and equipment, we can meet this challenge and ensure we continue to deliver the safe, efficient and reliable service we have been delivering for over 100 years.” 

Infrastructure & Engineering 

Maintaining and modernizing the infrastructure of the Canal is no small mission. Over 100 maintenance projects are conducted in a typical year to preserve infrastructure and equipment. 

To proactively plan, monitor and execute projects more efficiently, Miguel Lorenzo, Vice President of Infrastructure and Engineering and his team spent the past few months reviewing and optimizing the waterway’s investment portfolio to determine new ways to carry out equipment acquisition, improvement and replacement projects. According to Mr. Lorenzo, 2021 marked the start of a series of organizational changes that will “fundamentally change” the way the Canal’s physical assets are managed over the coming years, with landmark investments planned for 2022 that will guarantee the long-term sustainability of the Canal. 

“We are carrying out exhaustive evaluations of the conditions of our infrastructure, especially the oldest, to define the needs of attention in the short, medium and long term,” he said. “In parallel with this, we will be evaluating and executing those projects that aim to maintain the Canal’s social and environmental license, especially those aligned with our declaration of being a neutral entity in greenhouse gas emissions by 2030.” 

Digital Transformation 

The design and implementation of the Panama Canal´s digital transformation vision and high-level roadmap was another strategic endeavor in 2021 that will continue into the coming years. According to Antonio Córdoba, Vice President of Digital Transformation, “going digital” is essential for the Canal as it will “evolve our organization to a new stage of innovation and will keep us relevant, transparent, and successful.” 

As part of this initial process, Mr. Córdoba and his team completed the following: priorities determination and digital breach analysis, new ways of working to be adopted, the data and analytics roadmap, the people and cultural transformation journey, among other components of the overall Digital Transformation strategy. “We also defined, at high level, our internal IT evolution journey, which will allow us to support the organization in our acceleration towards the digital future.” 

Moving forward, the team anticipates a strong focus on scaling its organizational agility, as well as a move towards new digitalized and improved processes. These shifts will then bring increased operational efficiency at all levels. “An incremental usage of data in ways we had never before, thanks to new technologies we are implementing, will allow the organization to discover new business insights, improve precision in forecasting and predictability, and make better data driven decisions in 2022,” said Mr. Cordoba. “We will prioritize updating our IT baseline infrastructure and systems, in a sustainable and consistent way, to be able to face the new era of transformation and technology changes.” 

Water 

The Panama Canal is also advancing investments that will redefine its water use for the next 50 years, while making steady progress in the short-term.  

A year after introducing water measures, the Panama Canal offered a maximum draft of 50 feet at the Neopanamax Locks in 2021, the highest allowed at the waterway. Achieved through effective water management and an increase in rainfall, the higher draft ultimately increased the waterway’s capacity to maneuver larger and heavier vessels, a trend expected to continue in 2022. 

The Panama Canal, meanwhile, made progress on its search for a long-term water solution, reaching an agreement in November with the US Corps of Engineering (USACE) for developing an economically justified and environmentally sustainable integrated water resource management plan. John D. Langman, Vice President of Water Projects, confirmed that the plan will cover “specific measures to maximize the yield of water resources within the Panama Canal watershed and potentially includes complementary solutions integrated from outside of the Canal´s watershed, resulting in increased operational reliability and resiliency of the system.” He added that the agreement will also encompass “a recognition, feasibility studies, and tender support phases to prepare design build solicitations for the solutions selected, as well as capacity building throughout the process.” 

In 2022, Mr. Langman and his Panama Canal team will work alongside USACE experts to advance project management, engineering, hydrologic, water quality and other elements during the recognition and feasibility phases related to the reached agreement. 

Strategic Vision 

Measures to secure water in 2021 also offered invaluable lessons that will be applied in the coming year.    

“After implementing the freshwater surcharge and hearing from customers over the past few months, we recognized the value of offering a dynamic price, based on market,” said the Panama Canal Administrator, Ricaurte Vásquez Morales. “We are therefore working with our customers to develop a new simplified pricing strategy that provides them more visibility and transparency while also safeguarding the competitiveness of our route.” 

According to the Administrator, “transparency and close communication with customers from across the Panama Canal’s team proved essential to the waterway’s overall success in 2021. At the end of the day, our legacy depends on our ability to sustainably create, capture, and render value for our customers, which we can only achieve together.” 

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

November

Panama Canal Caps Month of Sustainability Advocacy with Preview of Upcoming Decarbonization Measures and Next Steps on Water Solution

On the heels of COP26, the Panama Canal announces Green Vessel Classification Plan and engagement with the U.S. Army Corps of Engineers for long-term water solution

Five years ago, the Panama Canal’s contributions to the reduction of emissions from the international shipping industry were presented during the International Maritime Organization’s (IMO) 70th Marine Environment Protection Committee session (MEPC 70). Fast forward to this month, the waterway’s efforts have expanded tenfold to respond to the urgency of climate change. This month, the Panama Canal is building on this further, from advocating for shipping decarbonization at the UN Climate Change Conference (COP26) to unveiling a new greenhouse gas emissions classification system aimed at strengthening the waterway’s position as a green corridor for global trade. Expanding Efforts to Support Greener Vessels   The Panama Canal Administrator Ricaurte Vásquez Morales announced that the Canal would take its efforts another step further, in recognition of the urgency of climate change and the need for accelerated industry and global climate action. While speaking at AAPA Latino in Cartagena, Colombia, on November 30, Administrator Vásquez announced the Panama Canal Green Vessel Classification system, which will include a Greenhouse Gas (GHG) Emissions Fee. These changes will build upon the Canal’s existing incentives for sustainable shipping lines, provided through its Green Connection Environmental Recognition Program. This program has evolved from the Green Connection Award, the Environmental Premium Ranking, and the Emissions Calculator. The urgency to take climate action is here, and the industry must take an accelerated approach to mitigate the already adverse effects of climate change. By implementing this fee, the Canal acknowledges the environmental impacts of shipping, as well as those in the industry, who are paving the way to minimizing emissions. The fee will support investments to guarantee environmental performance standards and aid in making Canal operations carbon neutral. Ships will be classified in levels depending on their energy efficiency. The classification and fee will apply to all vessels over 125 feet (38.1 meters) length overall (LOA). This classification system will incorporate the following three factors that will reduce GHG emissions between 20-100 percent during transit through the Canal:

  1. Energy Efficient Design Index (EEDI)
  2. Efficient operational measures such as the use of Bow Thrusters
  3. Use of Zero Carbon Biofuels or Carbon Neutral Fuels

The Canal has held discussions with ship owners directly for transparency, as it evaluates these changes, and will work in partnership with customers to accelerate carbon neutrality. This program will align with the International Maritime Organization regulations that promote international plans for decarbonization in the maritime sector. Carbon Neutrality and Digital Transformation at the Panama Canal Meanwhile, Deputy Administrator Ilya Espino de Marotta participated at the TOC Connect Conference on November 3, where she shared updates on the Canal’s ongoing process to reach carbon neutrality, including upcoming plans to consolidate Canal facilities to reduce its carbon footprint by 33 percent. She also shared that, as ships transition to cleaner fuels, the Canal is investing in hybrid tugboats, starting with 10 with potential to include more, which reduces 20 percent of tugboat operational carbon emissions. In addition to hybrid tugboats, the Canal will introduce a fleet of electric vehicles as well. Maintaining and modernizing the Canal’s infrastructure is also a priority for securing a sustainable future. For the remainder of the decade, the Canal plans to invest several billion dollars in equipment, infrastructure, technology, and the water solution project, among others.  This plan will also include a step towards digitizing Canal operations to provide more value for customers. With more data, the Canal can better anticipate customer needs and tailor its operations to sustainable solutions. Advocating for Shipping Decarbonization at COP26 At the start of the month, the Panama Canal joined world leaders at COP26 in Glasgow to advance global climate action. On November 4, the Panama Canal participated at the UNFCC’s Action Hub, with a TED-style presentation to international delegations and industry leaders on how sustainable maritime routes can drive climate action.  The Canal stressed the importance of having the entire supply chain, from shipping lines to final customers, involved in the sustainable transition. “We need to understand that being part of the maritime business can and should support the global effort of reducing carbon emissions,” said Environmental Specialist Alexis Rodriguez during the presentation at the UNFCC’s Action Hub. “Shipping will continue to play a big role in the supply chain, as COVID-19 continues to impact imports. We need to have clear guidelines across all international bodies to reach these goals.”   From there, the Panama Canal was also present at the International Chamber of Shipping (ICS) side event “Shaping the Future of Shipping” on November 6, showcasing the advantages of the Panama Canal’s green route and the value green corridors provide to international maritime trade. Finally, Mr. Rodriguez served as a panelist for an IMO event on November 10 that explored opportunities for developing countries to provide zero-carbon fuels to global shipping. He then closed the month’s activities by joining the IMO’s Marine Environment Protection Committee (MEPC) meetings, where discussions around research and development for shipping decarbonization continued. Securing the Future of Water Availability   In 2019, the Panama Canal announced plans to invest in a series of solutions to secure water quality and quantity to support the Canal and local population’s needs for at least the next 50 years. As the latest step towards this goal, the U.S. Army Corps of Engineers (USACE) will provide technical assistance for the project to ensure operational sustainability, engineering services and overall analysis of the project. USACE will work together with Canal professionals to develop the conceptual design for water alternatives. Both organizations have a longstanding partnership, dating back to the Canal’s construction in 1914.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

October

Panama Canal Administrator on Global Supply Chain Issues, Record FY21 Traffic and Significant Investments Through 2030

The Panama Canal began its Fiscal Year 2022 (FY22) at the start of October, marking the end to a year of record-breaking traffic at the waterway and global supply chain disruptions worldwide. To mark the occasion, we held a Q&A with the leader of the Panama Canal, Administrator Ricaurte Vásquez Morales, to learn about the waterway’s performance in FY21, global supply chain constraints, carbon neutrality next steps and more. See his responses below.The Panama Canal saw record tonnage in 2021 fiscal year (FY21). Which segments and corresponding trends in global trade drove this growth? Will this continue in FY22?Between October 2020 and September 2021, 516.7 million Panama Canal tons (PC/UMS) passed through the waterway, carried mainly by containerships (184.3 million PC/UMS tons), as demand for consumer goods increased sharply in the United States. We anticipate traffic levels for containerships will be similar in FY22, as high demand for containerized cargo imports in the U.S. continues. Across all traffic segments supported, liquefied natural gas (LNG) carriers registered the highest increase in tonnage through the waterway in FY21, with almost a third (31.4 percent) more LNG carried through the Panama Canal compared to the previous year. We also saw the highest ever LNG transits and tonnage facilitated by the Panama Canal team overall this year, no small feat given the segment only began transiting the waterway for the first time after the completion of the Panama Canal Expansion in June 2016. This increase was largely due to record low temperatures during the winter in Asia, heightened demand for energy during what was already peak season. In addition, grain exports through the Canal increased as U.S. exporters meet soybean demand to feed livestock and poultry in China. We were able to accommodate this shift in the market by staying flexible with our transit reservation system and operations. In the past five years, our team has gained tremendous experience supporting and adapting to the needs of the segment, which has solidified the Panama Canal as a safe, reliable route for LNG. As more LNG terminals in the East and Gulf Coasts of the U.S. open or expand their operations and increase exports to Asia, we expect the segment will only continue to rely on the waterway more for at least the next three years.How did the Panama Canal mitigate the continued impact of COVID-19 on operations? Despite the continued challenges our industry faced, the Panama Canal had a landmark year thanks to our world-class workforce and their commitment to serving world trade without interruption. I am incredibly grateful for those on our team who have gone to significant lengths to protect the health and safety of our workforce and that of our customers and their crews. We will continue to maintain safety measures, which have allowed the Canal to remain open without pausing transits enabling customers to continue delivering essential goods around the world.Challenges in the supply chain continue to affect ports across the world – how did the Panama Canal manage this in FY21?Going into FY21, we knew the residual impact of COVID-19 would continue to affect supply chains, and we readied our workforce for this situation. Between October 2020 and September 2021, containerized cargo imports to the United States grew 19 percent as consumers began to spend money saved during the pandemic. The lack of ships to supply this growing demand coupled with congestion issues at ports, and high freight rates tightened the supply chain. The Canal managed these shifts by keeping operations agile, forecasting market trends to ensure uninterrupted service to our customers, while keeping safety at the center of our operations. For example, the Canal made changes to accommodate larger ships, increasing the maximum allowable length (LOA) for vessels transiting the Neopanamax Locks in June 2021 to allow 96.8 percent of the world’s fleet of containerships to transit the Canal. In addition to the increased LOA, the Canal also maintained a 50-foot draft, the highest level allowed at the waterway, benefitting customers who were able to transport more cargo.While we have been able to stay agile and flexible to continue offering reliable service through this past year’s challenges, we have not lost sight of the future. Therefore, through the past year, the Canal continued to advance its commitments to the environment, through sustainability and innovation.  Were there any significant changes in top routes and customers? Measured by tonnage carried, the top trade routes using the Panama Canal were the same year over year apart from the East Coast South America – Asia route, which replaced the East Coast U.S. – West Coast of Central America route. South Korea also rose in the ranks to become the fourth top user of the waterway this year, moving above Chile and preceded by the United States, China, and Japan.Does the Canal have plans to digitize its operations? Many are turning to technology as the answer to overcoming rising challenges across the industry, from global supply chain issues to climate change. To stay ahead, the Panama Canal will kick off a multi-year digital transformation program in FY22 that will change the future of our business. In lieu of expanding the Canal’s physical infrastructure, which would require costly and disruptive construction, our team will use technology to find new ways in which we can increase the value the Panama Canal offers to our customers and country. Over the next decade, we will invest approximately $500 million, including in advanced data analytics capabilities, so our team can better understand the needs of our customers, their long-term projections, and the services the Canal can offer to make their transit more efficient. In this transition, we will seek to gain visibility into the needs of not only shipping lines, but also the owner of the cargo and the final customers, leveraging real-time data to help us become more agile, enhance our quality of service, and continue to add value to the route. In FY21, the Canal announced plans to become carbon neutral by 2030. What progress has been made to accomplish this goal? What’s coming next?We are working on the roadmap outlining the specific steps that the Panama Canal will take to ensure we reach carbon neutrality by 2030, from how we generate electricity from renewable sources to migrating the Canal’s fleet to electric vehicles and hybrid tugboats. By the end of the decade, we expect to invest roughly $2.4 billion in equipment replacement and infrastructure modernization, as well as $2.8 billion in maintenance. Our team will also explore a pricing strategy that promotes the efficiency and low-carbon emissions of the ships that transit the waterway, as well as participate in the upcoming 2021 United Nations Climate Change Conference (COP26) and IMO Marine Environment Protection Committee (MEPC77) meetings. The Canal secured a 50-foot draft this past year. How will the Canal continue to guarantee a steady supply of water? We are still advancing our planned investment that will guarantee a steady draft of water at the Panama Canal for the next 50 years. We decided to reformulate the tender model for this long-term Water Management System Program in June 2021 to take into consideration the feedback received from the interested companies that participated in the prequalification process. We are currently working on evaluating the best alternative(s) considering cost-benefits, reliability and control, technical challenges, and social and environmental implications. The next step will be the production of conceptual designs. We chose this approach as it will reduce risk, improve cost estimates, and facilitate the technical evaluation of the proposals. In the meantime, the team will continue to offer transparency by sharing daily water levels at Gatun Lake and announce draft adjustments at least four weeks in advance.

 

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

September

Investing in Longevity and Carbon Neutrality:
Setting the Stage for the Path Forward at the Panama Canal

Visión a largo plazo y carbono neutral: La ruta hacia el futuro del Canal de Panamá

The COVID-19 pandemic has undoubtedly changed the status quo of the shipping industry. As supply chains shifted, trade patterns once solidified in their routines altered course and a whole industry began to adapt. This exposed areas up and down the supply chain that needed to reform to the demands and challenges of today, beyond pandemic preparedness. Most notably, the latest IPCC report revealed that human influence has warmed the Earth’s climate at an alarming rate, and it is expected that global warming of 1.5°C and 2°C will be exceeded during the 21st century unless deep reductions in carbon dioxide (CO2) and other greenhouse gas (GHG) emissions occur in the coming decades. This report sounded the alarm, and proved, furthermore, that inaction is unacceptable.

The Panama Canal has transcended beyond its role as a shortcut in the logistics chain, offering reduced voyage times along maritime routes and emissions, to an advocate for sustainable shipping and route optimization as a means to reduce CO2. Thus, this past year, it introduced several initiatives to better align with the global response to climate change, as many players in the value chain have done, from shipping lines to cargo owners.

At the start of 2021, the waterway launched the CO2 Emissions Dashboard, which began tracking monthly data on carbon emissions per segment. In April 2021, the Canal also announced its objective of becoming carbon neutral in its operations by 2030, a deadline shared by many in the maritime industry, as the urgency of climate change continues to pose an imminent threat to the Earth’s resources.

As recently cited by the UN Global Compact’s Charting a 1.5 C Trajectory for Maritime Transport brief published this month, the Canal established its decarbonization targets, while encouraging customers to maximize sustainable transits by publishing its data through the Emissions Dashboard, demonstrating actions that can be taken to accelerate decarbonization across the shipping value chain. Just this month, the Panama Canal and more than 150 other organizations across the maritime value chain signed the Call to Action for Shipping Decarbonization, urging world leaders to help further accelerate the decarbonization of shipping.

Looking ahead, the Canal is working on its roadmap to outline the specific steps to achieve its goal of carbon neutrality by 2030, which includes generating electricity from renewable sources, consolidating facilities to minimize the impact of its operation’s footprint, and migrating the Canal’s fleet to electric vehicles and hybrid tugboats. In addition, the Canal will also establish a pricing strategy that promotes the efficiency and low-carbon emissions of the ships that transit the waterway.

To be effective in this movement, however, organizations must put not only sustainability, but also resiliency at the core of their operations. This requires investing in technology, infrastructure and optimizing operations to ensure they are as reliable and efficient as possible. At the Panama Canal, modernization and maintenance programs are planned in advance and then methodically choreographed and communicated to customers with sufficient time to minimize disruptions.

By 2030, the Panama Canal expects to invest roughly $2.4 billion in equipment replacement and infrastructure modernization, and $2.8 billion in maintenance. In addition, the waterway also plans to invest $500 million in digital transformation to maximize capacity and provide added value to its customers.

Implementing an innovative long-term water management system to sustain operations and human consumption will remain a significant focus by the Canal team. In the meantime, the team will continue to maintain transparency by sharing daily water levels at Gatun Lake and announcing draft adjustments at least four weeks in advance.

Transparency and ongoing communication with customers remain top priorities for the Panama Canal team throughout this green transition. Earlier this year, the waterway made modifications to its reservation system to offer additional booking options and flexibility for customers across market segments in anticipation of growing market needs. In the coming months, the Canal will aim to provide further pricing visibility and certainty to better safeguard the competitiveness of the waterway, taking into consideration the route’s value and dedication to providing a competitive service to the global maritime community.

 

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

August

History in Pictures: 107 Years of the Panama Canal

Maritime trade in the Americas before the Panama Canal opened 107 years ago required sailing around Cape Horn, the southernmost tip of South America, a voyage that could take up to two months. Today, sailing from US East Coast to Asia through the Panama Canal takes approximately 26 days, compared to 43 days for voyages through Cape Horn, 37 days through Cape of Good Hope, or 33 days if transiting through the Suez Canal.

Today, the Canal has facilitated more than 1.1 million transits, connecting more than 180 maritime routes, and 1,920 ports in 170 countries. It has also grown to serve as the Green Route by continuously expanding its environmental protections, incentives and offerings as a more sustainable option for shipping lines. Since its opening in 1914, the Canal has contributed to the reduction of more than 850 million tons of carbon dioxide (CO2) through its service to shipping lines.

As we look ahead to the future, take a look back at key moments in the Canal’s 107-year history:

15 DE AGOSTO DE 1914 - Inauguración del Canal de Panamá
AUGUST 15, 1914 – The Inauguration of the Panama Canal

The Panama Canal opens to the world with the transit of the SS Ancon transiting from the Atlantic to the Pacific. Two hundred people were on board, including Captain John Constantine and the President of Panama, Belisario Porras.


MAY 12, 1963 – 24/7 Operation

The Panama Canal starts operations 24 hours a day, seven days a week. This was made possible with the installation of fluorescent lighting at the locks and the Culebra Cut, allowing night transits and increasing overall transits to the waterway.

Did You Know? On September 4, 2010, the bulk carrier Fortune Plum became the millionth transit through the Canal.


SEPTEMBER 7, 1977 – The Torrijos-Carter Treaties

The United States and the Republic of Panama sign the Torrijos-Carter Treaties, setting the stage for the transfer of the Panama Canal from United States to Panamanian administration in 1999.

FEBRUARY 16, 1994 – Seven Wonders of the Modern World

The Panama Canal is named one of the seven wonders of the modern world by the American Society of Civil Engineers (ASCE).

DECEMBER 31, 1999 – A Panamanian Administration

Panama takes on the administration and operation of the Canal. Since its transfer, the Panama Canal has been focused on improving the quality of its service and the safety and reliability of the route to offer a competitive service to global trade.

Did You Know? Every year, the Panama Canal spends more than $250 million in its maintenance program and invests roughly $200 million in projects ranging from replacing floating equipment to modernizing critical infrastructure and beyond.

SEPTEMBER 3, 2007 – Construction of the Expanded Canal Begins

Construction of the Expanded Canal begins, prompting investments in similar expansion projects around the world, particularly at seaports located along the U.S. East Coast, to take advantage of the forthcoming increase in traffic. The blast in Paraiso Hill (pictured above) signaled the breaking ground and beginning of the Expansion Program.

JUNE 26, 2016 – Expanded Canal Inauguration

The Expanded Canal is inaugurated with the transit of the COSCO Shipping Panama, creating a new lane for the transit of Neopanamax vessels and doubling the cargo capacity of the waterway.

Did You Know? The Panama Canal is responsible for the management, maintenance, use and conservation of the water resources of its surrounding watershed. The Canal also helps protect the Panama Canal watershed’s overall sustainable development and ecosystem in partnership with local communities and partners, such as the Smithsonian Tropical Research Institute.

DECEMBER 27, 2020 – The Largest Capacity Vessel Transits

The CMA CGM Argentina, with a 15,846 Total TEU allowance, transits through the Neopanamax Locks, as the largest capacity vessel to date.

APRIL 26, 2021 – Carbon Neutral by 2030

The Panama Canal initiates the process of becoming a carbon neutral organization by 2030.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

July

Celebrating the Legacy and Future of the Panama Canal’s Green Connection Environmental Program

Today, the Panama Canal presented the MSC Virgo, a containership with a Total TEU Allowance (TTA) of 15,746, with a Green Connection Award during its maiden voyage through the waterway, in recognition of its high environmental standards. In addition, the vessel was applauded for choosing the most emissions-efficient route when traveling from Europe to the West Coast of South America. The decision to navigate via the Panama Canal allowed the MSC Virgo to save more than 4,500 tons of CO2.

Sustainability is ingrained in the Panama Canal’s legacy. The waterway opened almost 107 years ago as the shortcut for maritime trade and the Canal works to add value as the Green Route – implementing measures and initiatives that maximize the waterway’s environmental and operational efficiency. This legacy of sustainability only continues to grow.

The recognition to MSC Virgo comes on the fifth anniversary of the implementation of the Green Connection Environmental Recognition Program and the sixth month of data published in the CO2 Emissions Dashboard. Though much has been achieved in the past five years, the road towards decarbonization will require the efforts of an entire industry. As the Canal looks ahead to the future, here are a few highlights from programs over the past five years:

The Green Connection Environmental Program

Launched in 2016, the Green Connection Program introduced the Environmental Premium Ranking and the Green Connection Award. The Ranking is an incentive that rewards qualified customers who meet high environmental efficiency standards with the opportunity to improve their position within the Customer Ranking System, which is considered when booking transits through the Panama Canal. In 2018, this system was applauded by the International Transport Forum and the Organization for Economic Co-operation and Development (OECD) as an innovative idea that could be widely applied in other ports. As of today, 73 customers are ranked in the system.

The Green Connection Award was launched in the same year to honor customers who comply with the highest environmental performance standards. When awarding ships, the Canal considers the operational efficiency, the Environmental Ship Index (ESI) and the efficient design of ships, as well as fuel efficiency measures and emissions reduced in transiting the Panama Canal over other routes. The first recipient of the award was the Maran Gas Apollonia on July 25, 2016, the first ever LNG vessel to transit the Panama Canal thanks to the inauguration of the Neopanamax Locks.

Since the Maran Gas Apollonia transit, more than 1,500 vessels have received the Green Connection Award. A few notable recipients include container vessels such as CMA CGM Theodore Roosevelt, Hapag Lloyd’s Valparaiso Express, and ONE Hawk, as well as NYK‘s vehicle carrier Garnet Leader, the LPG tanker G.Dolce, the Q-Flex LNG tanker Al Safliya, and the IMOIIMAX tanker Stena Imperial. The Green Connection Award was also presented to the hydrogen-powered, zero-emission catamaran Energy Observer, which serves as a floating laboratory for ecological transition, while in its expedition delivering a message towards a decarbonized future.

Over the past five years, more than 10,000 transits have been considered Green Connection transits because of their CO2 emission savings by using the Panama Canal route. With the Canal’s expanded emissions tracking system and environmental incentives, the goal is for this number to steadily grow as the world turns towards a cleaner future.

Tracking Emissions

One year after launching the Green Connection Program, the Panama Canal enhanced its emissions tracking abilities through the Emissions Calculator – a tool that allows to assess the shipping lines’ greenhouse gas (GHG) emissions reductions per route, including the amount saved by transiting the Panama Canal over the most likely alternative route. The tool aims to incentivize customers to demonstrate strong environmental stewardship and adopt more sustainable itineraries. For example, a container vessel traveling from Asia to the U.S. East Coast saves about 12 percent in emissions when returning via the waterway rather than transiting the Suez Canal and would save 18 percent in emissions compared to sailing around Africa’s Cape of Good Hope. Since the program was introduced in 2016, the Emissions Calculator has shown that customers have saved 40 million tons of CO2 by choosing the Panama Canal route.

After updating the tool to use georeferenced data in 2019, the Canal debuted a CO2 Emissions Dashboard building off information provided by the Emissions Calculator in January 2021. Over the past six months, the Dashboard has published monthly data on the CO2 emissions saved by vessels that chose to transit the Panama Canal compared to the most likely alternative route. Customers benefit from this information as it provides them visibility into how the route helps shipping lines reduce emissions with each transit.

Transparency and quality of service remains at the heart of the Canal’s objectives, fostering a sustainable future for global trade tacking actions to achieve the IMO and Paris Agreement global commitments.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

June

The Transformation of the
Panama Canal’s Service Since the Expansion

Commemorating the fifth anniversary of the Neopanamax Locks and the steady transformation of the Canal’s safe, reliable and sustainable service.

Five years ago, the Panama Canal opened the Neopanamax Locks, creating a third lane for traffic at the waterway. The Expanded Canal doubled the waterway’s capacity, attracting new markets and opening up world trade. Since the inauguration, more than 13,700 vessels have transited the Neopanamax Locks, accounting for 54% of the tonnage handled by the waterway.

However, ensuring a seamless transition was not instant, but rather driven by ongoing transformation of our workforce, operational measures, and equipment, among other elements. This month, we reflect on that gradual transformation and how, through heightened flexibility, reliability, and sustainability, we have reshaped the Panama Canal’s service and value to the world.

Fostering Safe & Sustainable Transits at the Waterway

The wider dimensions of the Neopanamax Locks allowed the Panama Canal to begin accommodating a larger class of vessel, as well as an entirely new segment – liquefied natural gas (LNG). While LNG vessels were previously too wide to fit through the Panamax Locks, the Canal’s Expansion meant over 95% of the global LNG fleet could transit the Panama Canal for the first time, allowing exporters in the United States to ship natural gas to Asia at competitive prices.

Did You Know? Container ships continue to be the main user of the Neopanamax locks with 42% of transits, followed by liquefied petroleum gas carriers (22%), dry bulkers (15%) and LNG vessels (14%).

The new locks also required updated technology and equipment to ensure the safe passage of larger vessels. As a result, the Panama Canal acquired 14 new tugboats, 8 of which now have top-of-the-line firefighting capabilities, increasing the Canal’s fleet to 46 tugboats. The Canal also provided rigorous training to its pilots and tugboat captains to prepare them for vessel maneuvers through the new locks and conducted trial transits before the inauguration of the Neopanamax Locks in 2016.

“As the head engineer of the Expansion, I witnessed firsthand the excellence of our operations team in adapting and innovating to welcome a new era for global trade,” said Panama Canal Deputy Administrator Ilya Espino de Marotta. “We continue the same commitment today we made five years ago – to continue enhancing the service and value we offer at the Panama Canal for the benefit of our customers and the world.”

The Canal continues to find ways today to expand its services to accommodate larger vessels through the Neopanamax Locks. Most recently, the waterway increased the maximum length overall (LOA) for commercial and non-commercial vessels acceptable for regular transits of the Neopanamax Locks to 370.33 meters (1,215 feet), up from 367.28 meters (1,205 feet). The change means that 96.8% of the world’s fleet of containerships can transit the Panama Canal, shortening routes and benefiting economies around the world.

Did You Know? In addition to the increased length overall, due to the effective management of the water resources, the Panama Canal was able to maintain draft levels above 13.72 meters (45 feet) during the dry season in 2020, and secured an optimal draft throughout the first six months of 2021. In June, the waterway increased the draft offered to 15.24 meters (50 feet), the highest level allowed in the waterway.

The efforts to welcome larger ships to transit the waterway have also fulfilled another priority– increasing its emission savings offered to shipping lines. The Expanded Canal significantly increased the route’s emission savings for shipping lines by allowing them to transport even greater amounts of cargo in fewer trips, reducing time, fuel, and emissions. By offering a shorter route for ships, the Neopanamax Locks contributed to a reduction of 40 million tons of carbon dioxide (CO2) equivalent emissions during the last five years, in comparison to the most likely alternative routes.

“The Expansion allowed us to significantly increase the value we offer to our customers as we look to minimize the carbon footprint through the reduction of emissions in our own operations with the objective of fostering a more sustainable future for shipping,” said Panama Canal Administrator Ricaurte Vásquez Morales.

Building on these efforts, the Panama Canal is committed to decarbonizing operations, becoming carbon-neutral by 2030. As an initial next step, the Canal will also soon begin an electric vehicle pilot program to inform the migration of its entire fleet away from fossil fuels. Decarbonizing operations at the Canal as well as developing a viable solution for water conservation continue to be urgent priorities.

An Optimistic Rebound and Future Outlook

The Panama Canal has adjusted its operations not only for water conservation, but also for changing trade patterns due to the COVID-19 pandemic. While traffic has returned and is expected to remain stable at the Neopanamax and Panamax Locks in the coming months, the Panama Canal will continue adapting its operations to accommodate its customers through the ebbs and flows of the global economic recovery. To demonstrate this, the Canal announced that the temporary suspension to the advance payment of reservation (booking) fees is until further notice to offer customers support and added flexibility following a series of extensions.

The past five years have not been without hardship, particularly the last year. However, we are proud of what our team has accomplished for our customers, country and world since opening the Neopanamax Locks to the world. As we celebrate the fifth anniversary of the Expansion, we remain committed to building on these efforts to expand the Panama Canal’s value and role in ushering in a more sustainable, connected world for years to come.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

May

Part of the Solution: How the Canal Protects the Natural Resources of the Watershed

Beyond the Panama Canal being a link for world maritime trade, the Canal Watershed facilitates connectivity for the rich biodiversity found in the region. Surrounding the Panama Canal lie thousands of acres inhabited by howler monkeys, white-faced capuchins, toucans, harpy eagles, sloths, and deer, among others.

Panama is part of the Mesoamerican Biological Corridor, the natural land bridge from South to North America, used by species in migration. The Canal Watershed is part of this bridge, consisting of over 847,500 acres of rainforest, of which 57% is forest cover. The Panama Canal Watershed, in addition to providing water for Canal operations and for more than half of the country’s population, is also a sanctuary for a great variety of species of flora and fauna.

Today, the surrounding waters and islands in the Canal Watershed house approximately 160 mammal species. Of the 33 mammals considered in danger of extinction in the country, 30 live in this area, among them, the jaguar, the tapir and the white-lipped peccary. The Canal Watershed is also home to more than 500 bird species, with 25 of the 35 protected bird species in the country living in this area. In addition, the area is also home to 125 reptile species and 26 types of fish.

The Panama Canal plays an important role in the conservation of this area, fostering sustainable development and protecting its water resources. The Panama Canal has long recognized water as its principal resource, implementing and expanding a myriad of programs that stretch beyond its operations in the name of conservation.

The Panama Canal diligently manages the Canal’s water supply and actively protects its environmental resources, while enhancing and maintaining the sustainability of the Canal Watershed. As part of its operations, the Canal team is in charge of maintaining the water resources, in quantity and quality, using the necessary technology to properly forecast water levels, ensure the proper conservation of the natural resource, and effectively control water flow.

By taking care of the Watershed and its natural resources, the Canal contributes to the protection of the species in the region. As part of its environmental protection strategy, the Panama Canal carries out several programs for the protection and conservation of the natural resources, which contribute to the biodiversity conservation strategies at the national level and protect the diversity of the Mesoamerican Biological Corridor.

The Canal carries out programs, such as agroforestry (integrating tree planting) and conservation efforts that have contributed to the reforestation of over 19,700 acres. By partnering with the local community in the watershed through land titling and environmental education programs in forest conservation, the Canal has contributed in the protection of additional 7,783 acres of rainforests. The Canal also conducts periodic monitoring reports to keep track of reforestation efforts. The waterway is also working with local stakeholders to design new strategies that will help enhance the forest cover, and encourages the creating of sustainable business initiatives linked to environmental protection, ecotourism, and agritourism.

During the seasonal migration of cetaceans, which include whales, dolphins and other large aquatic mammals, the Panama Canal promotes the implementation of maritime traffic separation schemes (TSS) which decreases the overlap between vessels entering or exiting the Canal and migrating whales. Vessels traveling through these areas on the Pacific side of the Canal are also required to proceed at a speed of no more than 10 knots, a practice known as Vessel Speed Reduction (VSR). This measure, first implemented in 2014, has significantly reduced the likelihood of serious incidents and accidents involving humpback whales and other cetaceans in the years since, assuring maritime safety and control of vessels transiting the waters surrounding the Canal. The measures have also lowered their greenhouse gas and pollutant gas emissions by an average of 75%, depending on the type, size, and fuel of each vessel.

Protecting biodiversity at the Canal Watershed cannot be done alone. The Canal maintains alliances with scientific institutions, the private sector and the Panamanian government entities. The Canal also has a longstanding partnership with the Smithsonian Tropical Institute (STRI), which carries out pioneering research on a wide range of topics, including biodiversity in the Watershed. Together, they continue their work on the 1730-acre Agua Salud Project, which compares how different experimental land uses affect water management, carbon storage and biodiversity conservation in the Panama Canal Watershed.

The Panama Canal will continue developing projects and initiatives to protect its natural resources. The health of the Watershed is a reflection of the health of the Panama Canal, and it continues to remain an important part of the Canal’s strategy to protect the natural resources surrounding the Green Route and guarantee water availability. Strong partnerships will be integral to this goal, and the Canal will continue to grow its partnerships and develop programs to be a part of the solution for nature.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

April

Safety at the Center of the Panama Canal’s Service to Global Trade

his piece originally appeared on Administrator Ricaurte Vásquez Morales’s LinkedIn Page; follow him or the Panama Canal on LinkedIn to receive the latest commentary and updates from the waterway.

Finally, the world is showing signs of steady economic recovery after last year’s pandemic-induced decline. The UN Conference on Trade and Development (UNCTAD) announced last month that the global economy is now expected to grow by 4.7% in 2021. The World Trade Organization (WTO) also estimates that world merchandise trade will increase by 8% in volume this year.

While these predictions are optimistic, as we saw recently -and as we all witnessed during the past year-incidents and unforeseen circumstances can arise at any minute and impact our day-to-day life significantly, as well as our global macroeconomic outlook. It is safe to say we have all learned the importance of adaptability and preparation for proper response to allow for effective management of unanticipated events and continuity of service.

In our case at the Panama Canal, we have carried these traits through the decades, founded on the principle of safety as the priority in everything we do, building what UNCTAD has described as a “culture of safety first”. While we cannot control what happens in the world, we are able to control the way we handle the response, and we do everything we can to do so in the best possible way. As such, I wanted to shed some light on the core ways in which we ensure safe and reliable transits every day at the Panama Canal:

  1. Pilot Control

The Panama Canal is unique in that we take control of each vessel during its transit. This is because transiting through our waterway involves a series of complex navigational maneuvers, including passage through the locks. To ensure the safety of each transit, we require our pilots to board and steer all vessels from start to finish. Their years of experience and deep knowledge of the currents and the locks ensure each vessel passes through the waterway safely.

Given pilots, among other personnel, are required to board each vessel and interact with the crew, we have heightened our health protocols amid the pandemic. These protocols will remain in place to ensure the continued safety of our customers and workforce.

  1. Tugboat Escorts

To supplement the pilot’s experienced guidance, we require tugboats to accompany vessels through their transits for any eventuality. This includes their passage through the Culebra Cut, the narrowest section of the waterway. This protocol is critical, particularly for Neopanamax vessels, the largest of which can carry around 15,000 TEUs.

  1. Water Management

Maintaining steady water levels is another critical component of safeguarding our service, as our operations depend on freshwater from Gatun and Alhajuela Lakes. In response to recent climate variability, the Panama Canal team has adopted conservation measures to sustain a level of draft that allows us to safely maneuver vessels through the Canal.

As a longer-term solution, we are also advancing the pre-qualification for the design, construction and implementation of a robust water management system that will guarantee enough water, not only in volume, but also in quality and control for the next 50 years. Addressing the latter will involve adopting technology to properly forecast water levels and effectively control water flow to our navigational channels. All in all, the Canal expects to make the waterway’s largest investment since the Expansion Program to secure water in the long-term.

  1. Ongoing Maintenance & Modernization

This water project, however, is just one of the wider multimillion-dollar investments we make on an ongoing basis to ensure our operations remain safe and reliable. Every year, the Panama Canal spends more than $250 million in its maintenance program and invests roughly $200 million in projects ranging from replacing floating equipment to modernizing critical infrastructure and beyond.

Dredging is one example of a particularly important, ongoing maintenance effort, as there is bank erosion and constant sedimentation coming from the natural water sources that feed its lakes. To make sure vessels always have adequate draft and channel width, our in-house team dredges the waterway almost daily, maintaining narrow operational areas such as the Culebra Cut and clearing the bottom of all navigation channels.

All projects are carefully planned to ensure there is no disruption to the Canal’s operations. In the coming years, we plan to invest around $3 billion in dredging, infrastructure projects and other modernization efforts to ensure we continue providing uninterrupted service.

These core practices, combined with countless other safety procedures, are the reason behind the Panama Canal’s long track record of safe and reliable operations. They enable us to adapt and respond to unforeseen circumstances, while keeping world trade moving. As the global economy recovers, we will continue to uphold this principle of safety, while finding ways to create, capture and render value for our customers.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

March

Connecting the World Through the Panama Canal

Mapping out the waterway’s continued connectivity across the globe

The Panama Canal has improved global commerce, transportation, and connectivity for more than 100 years. Through its shortened route and strategic location, the Panama Canal continues to expand its partnerships across the world and innovate its services to uphold its commitment to creating, capturing and rendering value to its customers and Panama.

Connecting 170 Countries

Since the opening of the Neopanamax Locks in 2016, the Panama Canal has come to serve 36 new maritime routes, connecting an additional 220 ports and 10 countries. Today, the waterway serves a total of 180 maritime routes that link 1,920 ports across 170 countries. Through this expanded number of routes, new terminals have become points of origin or destination for cargo that transits the Canal, such as the liquefied natural gas (LNG) export terminals of Cove Point and Cameron in the United States and Port of Point Fortin in Trinidad and Tobago.

The United States remains the top user country of the Panama Canal, with two-thirds of cargo transported through the waterway originating from or destined for this market, followed by China and Japan.

The main route using the waterway by cargo tonnage runs between the U.S. East Coast and Asia. It is followed by the U.S. East Coast and the West Coast of South America, Europe and the West Coast South

America, the U.S. East Coast and the West Coast of Central America, and the South America intercoastal route.

Facilitating Grain Exports

Traditionally, the dry bulk market has been and continues to be important in terms of the cargo tonnage transported through the Panama Canal. The main commodities moved in bulk cargo vessels consist of soybeans, corn and miscellaneous grains. The grain flows originate in U.S. ports located on the Gulf of Mexico region destined for China, the West Coast of South America, Japan and the West Coast of Central America. Soybeans are the most prominent commodity crop that navigates the Mississippi river to be shipped through U.S. ports bound for China. Corn shipments from the same ports are often bound for Japan and Peru.

In the last months, grain exports through the Canal have increased as U.S. exporters meet soybean demand to feed livestock and poultry in China.

Energizing the Market – LNG and LPG Trade

While various market segments have contributed to the Canal’s widened reach, the LNG and liquefied petroleum gas (LPG) market segments saw exponential growth in recent months. The world’s global economic recovery, combined with record low temperatures during the winter in Asia, heightened demand for energy during what was already peak season.

The LPG segment saw particularly high growth during the Canal’s 2020 fiscal year (FY2020), which ran between October 2019 and September 2020, recording Panama Canal tons (PC/UMS) tonnage 27 percent higher than projected. In that same period, 95 percent of LPG traveling through the waterway originated from the U.S., followed by Trinidad & Tobago with almost 3 percent. Almost half (49 percent) of all U.S. LPG exports passed through Panama Canal during this time, with a majority destined for either South Korea or Japan.

Connectivity through the Green Route

As the Panama Canal’s network expands, so does its positive environmental impact. Already, the Canal has contributed to a reduction of more than 830 million tons of carbon dioxide (CO2) since opening by allowing vessels to save time and fuel through reduced voyages and fewer cargo movements compared to freight transportation via air, truck or rail.

The Panama Canal has been able to steadily manage the water issue, to safeguard an operational level of water and its longstanding reliability for customers. This dry season, the Canal saw positive results from the measures implemented last year. The Panama Canal was able to secure a steady draft for this period through the waterway, allowing shippers to carry more cargo using the Panama route.

Through its unprecedented connectivity, the Panama Canal has facilitated the development of world maritime trade, unlocking opportunities for connectivity and exchange between countries and markets.

We are a link in a chain where reliability is the most valued attribute, and we are committed to continuing to invest in and build upon our role in connecting the world.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

February

The Panama Canal Releases January CO2 Emissions Data 
Shippers Saved a Million Tons of CO2 in January by Opting for Panama Canal Route

January 2021 Data from the CO2 Emissions Dashboard

The Panama Canal released the January data from the CO2 Emissions Dashboard, which calculates the carbon dioxide (CO2) emissions saved by vessels that choose to transit the Panama Canal over the most likely alternative route.

The figures confirmed that customers already saved a million tons of CO2 emissions in the first month of 2021, equivalent to the emissions produced by roughly 215,000 passenger vehicles driven for a year. This translates to each transit saving an average of 1,206 tons of CO2 emissions, roughly the amount a car would produce driving the length of the circumference of Earth 100 times.

Similar to the overall 2020 results announced in January, the containers segment was the main market segment of saved emissions followed by chemical tankers, dry bulk and LPG carriers.

The CO2 Emissions Dashboard was introduced to help inform how the maritime industry adopts initiatives to reduce the carbon footprint. This is informed through the Emissions Calculator, which allows shipping lines to measure their greenhouse gas (GHG) emissions reductions per route, including the amount saved by choosing  the Panama Canal over other routes.

“The data we will gather at the Canal for this dashboard will better inform our environmental practices and encourage customers to reduce their CO2 emissions in transit,” said Alexis Rodriguez, Panama Canal Environmental Specialist. “This is an important step, but we will also need international cooperation and policy implementation to safeguard the future of the environment and make a lasting impact in shipping.”

The Panama Canal has been a steadfast leader in the maritime industry for reducing carbon emissions. In 2020, the waterway contributed to a reduction of more than 13 million tons of carbon dioxide in comparison to the most likely alternative routes. In its years of operation, the Panama Canal has allowed vessels to save time and fuel by reducing voyage distances, representing a reduction of more than 830 million tons of CO2. The Canal also implemented the Green Connection Environmental Recognition Program, which recognizes customers who demonstrate excellent environmental stewardship and encourages others to implement technologies and standards that reduce emissions.

You can follow the Canal’s progress as the Green Route on LinkedIn through this Showcase Page, which will also feature voices from Canal leadership on upcoming initiatives.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

January

The Canal’s New Anchorages and Infrastructure
Investments Reflect a Changing Industry

The Monte Lirio anchorage project located southeast of the Agua Clara Locks in Gatun Lake

The opening of the Expanded Canal in 2016 transformed the waterway’s capacity to serve world commerce/trade. It was an investment in the future of the Canal and its customers, doubling its capacity of service to usher in a new world economy. The Canal’s investments and the maintenance of its operations represent a commitment to its continued reliable service. These investments are a monthly and annual commitment to its customers that the waterway is taken care of and in constant renovation.

The Monte Lirio anchorage project is a recent example of the Canal’s steady improvement and to provide customers with greater flexibility. The anchorage, located southeast of the Agua Clara Locks in Gatun Lake, will allow to anchor up to three Neopanamax vessels simultaneously.

To expand the anchorage, special equipment was used to clear trees and logs that were submerged in the surrounding areas. The area was then charted and measured to confirm that the seabed could safely anchor Neopanamax vessels with drafts up to 50 feet.

The anchorage, will provide additional, safe locations to secure Neopanamax vessels passing through the waterway, allowing for greater flexibility in scheduling Canal traffic, maximizing the Canal’s capacity. They will also minimize delays and increase safety by allowing vessels to be secured during rainy season or mechanical issues. The first two areas of the anchorage were opened on October 23, 2020, and the third will be available in February 2021.

At the moment, the Panama Canal is also carrying out two other projects that will add flexibility and capacity to the operation. They include the Peña Blanca anchorage in Gatun Lake, which should conclude early in 2021 and the deepening of anchorage “A” in Cristobal, which is scheduled to start operations in January 2022.

There are components of the Canal’s processes and infrastructure that date back more than a century ago, which require constant modernization and maintenance to continue offering the efficient service currently provided.

An example, is the system of dams and spillways that were originally designed for the Canal were constructed with technology no longer used today and that require constant modernizations to bring them up to current modem standards. By bringing in new technology and talent to innovate and adapt these systems, the Canal is able to keep up with the demands of the 21st century.

As a result, the waterway budgets for extensive maintenance each year. In fiscal year 2021, the Canal is investing 350 million dollars in maintenance. These investments include new acquisitions, replacements of operating fleets and improvements in its facilities all of which are key to the more than 100 years of operations at the waterway. From maintaining the locks, dams and tugboats, the Canal continually evaluates its infrastructure to maintain reliable transits. In the coming years, the Canal plans to invest around 3 billion dollars in capital expenditure on maintenance and infrastructure projects.

The investment in a new system guaranteeing the long-term supply of water for the next 50 years will also help the Canal continue its efficient, uninterrupted service in the future. This project, like the Expanded Canal, will fundamentally change operations at the Canal. To achieve this, the Canal expects to make the waterway’s largest investment since the Expansion Program. The new water management system will reshape how the Canal uses water, reinforcing its role as a green route for trade. It is also just one of the many ways the Canal is working to heighten its protection of the environment and contributions to a more sustainable era for the maritime industry.

The Canal’s attentive care and maintenance of its infrastructure is a perennial part of its operations. As the global economy rebounds from the pandemic, the Canal will ensure it remains prepared for the future while preserving its world class service.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

December

Panama Canal Administrator’s Year End Remarks:
A Legacy of Resilience and Action to Benefit
our Customers, Country, and World

This month marks the close of the Panama Canal’s 21st year under Panamanian administration. Looking back, our resilience this year attests to the experience and world-class workforce built over the decades. Despite facing new challenges in 2020, we upheld our long-standing commitments while continuing to create, capture and render value to our customers and Panama.

For one, we secured the continuity of our service by protecting our team and customers first. We introduced COVID-19 safety measures in March to keep the Panama Canal route operating safely and without interruptions throughout the entire year. To date, positive cases have not affected, nor have been linked to, our transit operations, and our staff remains on duty.

We also adapted our service to better partner with customers. In April, our team introduced relief measures to give customers added flexibility. These included the deferral of booking fee payments to maintain higher liquidity and the forfeiting of reservation fees for passenger vessels, the most affected segment during the pandemic. While these offerings were set to end on December 31, we extended them for six more months to help alleviate the prolonged impact of the COVID-19 pandemic on customers.

As the global economy began to recover, upending supply chains and traditional trade patterns, we worked with customers again to find ways to accommodate their needs. Since October, the Panama Canal, along with ports across the Americas, Asia, Europe, and beyond, experienced a sudden uptick in arrivals. This caused the convergence of high seasons across segments, such as container ships and liquefied natural gas (LNG). To accommodate the temporary surge in traffic, we have made operational adjustments, increasing the number of operational crews while maintaining safety protocols, to allow more vessels that arrive without reservations to transit per day.

Despite the urgent needs presented by the pandemic, we also advanced a key investment in the Panama Canal’s long-term sustainability. Earlier this year, when we implemented the freshwater fee, we announced our intent to undertake a portfolio of projects to guarantee water availability. In September, we launched the tender for our new water management system, with the contract to be awarded by late 2021. In the meantime, our water conservation measures proved successful in securing a steady draft. Our goal of ensuring that the value of our resources is factored into global supply chains, was also validated in both concept and price, when trading began in the first futures market for water in December. The Panama Canal will now begin 2021 offering a draft of 50 feet, the highest level allowed at the Neopanamax locks and exactly four feet more than was offered a year earlier.

Finally, we capped the year off by pledging the Panama Canal’s support for the global distribution of the COVID-19 vaccine. On December 21, the Panama Canal accepted an invitation to join the World Economic Forum’s Supply Chain & Transport Industry Action Group (SCT) to aid in the distribution of COVID-19 vaccines and medical supplies to Panama, Latin American and the Caribbean.  Panama’s strategic location and strong logistics hub will be key in achieving the goals placed by UNICEF for the massive distribution of vaccines to the region.

While we see light at the end of the tunnel, the Panama Canal will continue to prioritize safety. This approach has allowed our customers to continue ferrying essential goods in 2020 and guarantees the essential tools to usher in a brighter future in 2021.

In the meantime, we will be ready and working to accommodate the global recovery, one safe transit at a time.

Sincerely,

Ricaurte Vásquez Morales
Panama Canal Administrator

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

November

Panama Canal Honors Pledge for Continuity of
Service as Traffic Rebounds

In early April, Panama Canal Administrator, Ricaurte Vásquez Morales, pledged to keep the waterway safe and open throughout the pandemic. At the time, global supply chains that relied on the Canal to ferry essential goods were facing disruptions due to country lockdowns that affected ports, factories and consumers, creating an increasing level of uncertainty.

This pledge was not an easy feat since, in normal conditions, approximately 1,200 vessels transit the waterway every month, each requiring several members of the Canal’s transit operations team to board and facilitate its passage through the 50-mile channel. With the COVID-19 health crisis, the health and well-being of Canal workers and client’s crews were at stake. If the contagion went out of control, it could even affect the continuity of Canal operations.

Nonetheless, throughout its 106 years of existence, the Canal has had to adapt and operate through global crises. This experience has enabled it to effectively serve more than 1,700 ports in 160 countries, 24 hours a day, 365 days a year. Hence, beginning in January 2020, the Canal administration implemented safety protocols to guarantee a continuous and uninterrupted service to the communities and economies that depend on it.

“There will be light at the end of the tunnel, and we plan to be ready to support our customers when that day comes,” the Administrator wrote in May. “In the meantime, the Panama Canal will continue to play a critical role in making sure people’s basic needs, including food and medicine, are met every day during the pandemic.”

Today, the Panama Canal marks a promise fulfilled: the waterway has prioritized its team’s health with no traffic interruptions, and it now sees transits nearing pre-pandemic levels.

The Canal’s COVID-19 Roadmap

To ensure its safe, continued service, the Panama Canal prepared early, guided by its century’s worth of experience.

“As operations relied heavily on a culture of safety first, protocols were already in place to handle infectious diseases,” cited UNCTAD’s Review of Maritime Transport 2020. “This regulation was the basis of the initial approach of the Panama Canal Authority to dealing with the pandemic, since it established the procedures to follow prior to the arrival of a vessel and general requirements upon its arrival, as well as protocols for inspections and health measures that included procedures designed for infectious diseases.”

Building on these procedures, the waterway developed new COVID-19 response protocols following the recommendations of the World Health Organization (WHO) and in coordination with the Ministry of Health of Panama (MINSA). These protocols were to be updated constantly to ensure safe operations for both its workforce and customers’ crewmembers.

By March, operations were shifted to working remotely or physically distanced, with on-site personnel limited only to those necessary for projected transits. To minimize the risk of infection and fatigue, the Canal reorganized shifts, arranged private transportation, offered hotel rooms, provided protective equipment, created a COVID response team, took temperatures upon arrival at worksites, disinfected facilities and equipment regularly, and performed serological tests to all the workforce. According to UNCTAD, “vessel arrivals were still high, and putting in place such measures was key in ensuring the safety and availability of the workforce, while maintaining efficient and seamless operations for clients.”

Raising the Standards for Safety  

The arrival of Holland America’s Zaandam in late March put these measures promptly to the test. Carrying several ill passengers and crew, the cruise ship had been denied entry by several South American ports before reaching Panamanian waters. To provide support, the Panama Canal began coordinating closely with Holland America and MINSA, which inspected and signed off on each vessel before passage. Together, they facilitated the transfer of healthy passengers and supplies between the Zaandam and Rotterdam, a second Holland America ship that arrived to assist. Then, as an act of humanitarian goodwill, the Panama Canal facilitated the transit of both vessels.

To achieve this objective, Administrator Vásquez Morales, Deputy Administrator Ilya Espino de Marotta and countless other members of the Canal team established extreme safety measures by coordinating with MINSA. They opted to use the waterway’s wider and newer Neopanamax Locks for both transits, while reducing the number of Canal employees required onboard to two pilots who volunteered for the special maneuver.

Through this sense of solidarity, camaraderie and diligence, the Panama Canal shortened the Holland America vessels’ return to the United States by more than two days. According to UNCTAD, “the experience raised the standards for handling similar situations in the future.” It also reaffirmed the waterway’s commitment to continue serving those who relied on the waterway in times of need.

Remaining Safe Amid the Rebound

While the waterway has had cases of COVID-19 among its workforce, none have been tied to, nor affected, its transit operation. The Panama Canal continues to maintain stringent protocols to ensure the safety of its personnel and its customers’ crews.

The Operations team has been back at full staff since May, working in shifts that account for the time and personnel required to adhere to all safety procedures. After months of diligent work, they have observed a rebound in traffic.

Containerships, the Canal’s largest segment, are already returning at rates steadily above projections set in May as the global economy slowly recovers and U.S. retailers restock ahead of the holiday season.

Dry bulk transits now far surpass past projections, as China’s recovering pig farms raise demand for grains, on top of consistent coal shipments from Colombia to Chile and Mexico. LPG, LNG and tanker transits have picked up too, due to favorable market conditions.

To accommodate the recent rise in traffic demand, the Canal has made operational adjustments, increasing the number of operational crews while maintaining its safety protocols, to accommodate more transits per day for vessels that arrive without reservations.

In addition, the Canal has provided relief measures to its customers, which include the deferment of the payment of booking fees to maintain higher liquidity, and the forfeiting of reservation fees for passenger vessels that have been the most affected during this difficult times.

The Panama Canal will always prioritize safety, as it did during the height of the health crisis, adapting as needed to match the fluid situation. This approach and adherence to safety allowed the Canal to remain open without any closures or interruption to traffic throughout the pandemic, enabling customers to continue delivering essential goods around the world. The Panama Canal remains committed to accommodating the world’s economic recovery swiftly, and with all the necessary safety measures still in place.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

October

Thank You for Your Partnership in FY20

The world has come a long way since the letter I wrote in April. As we mark the end to the 2020 Fiscal Year (FY20) and begin a new this month, I would like to relay my appreciation for the partnership afforded over the past few months.

While the Panama Canal has overcome over a century’s worth of changes and trends, our team faced an extraordinary set of circumstances in FY20, from low water levels to trade disruptions to a global pandemic. I am grateful to our workforce and customers, who came together quickly and with great patience to ensure essentials goods continued to travel safely to communities around the world.

What I said in April still holds true – the Panama Canal will do everything possible to remain open. We know the world depends on it.

As the world begins to recover, our team will carry this spirit of partnership forward. We know the landscape is still uncertain and plans are changing quickly, so flexibility will be paramount at the Panama Canal in this new fiscal year.

We will always prioritize safety, as we did when we carefully programmed our resources to match traffic demand during the height of the pandemic to minimize infection risk. These measures have since allowed the Canal to remain open without pausing transits, enabling customers to continue delivering essential goods around the world. Rest assured that we have the capacity to accommodate the recovery swiftly and with the necessary safety measures still in place in the long run.

To ease the burden of the pandemic, we will continue to offer relief measures, such as the suspension of advance payments for transit reservation fees. We now also allow a new method of transit payment in the form of a “line of credit” through a bank guarantee, which will simplify the service request process and cut transaction costs.

Beyond the pandemic, water is another challenge that still lingers on the horizon. Thanks to our customers’ understanding of the temporary measures we put in place earlier this year. Their patience and flexibility allowed us to regain a steady draft and begin FY21 with the highest allowed maximum draft possible at the Neopanamax Locks. Nonetheless, we continue to pursue a new integrated water management system to ensure the Canal’s operational viability in the decades to come, while cementing the waterway’s role in achieving a low-carbon future.

Thank you for your partnership during the waterway’s 106th year in operation, and my first year as Administrator. We look forward to many more years of partnership to come.

 

Sincerely,


Dr. Ricaurte Vásquez Morales
Panama Canal Administrator

 

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

September

Ask the Experts:
Daniel Muschett and Jose Reyes

The need for a sustainable supply of water at the Panama Canal has been a top priority since the Canal experienced its fifth driest year in 70 years in 2019. Since then, the Canal implemented a freshwater fee, extended water conservation measures, and made changes to its booking system. As a result of these actions, the Panama Canal now offers a maximum authorized draft of 50 feet at the Neopanamax Locks, a significant improvement from the 43-foot draft in July 2019, confirming the effectiveness of said measures.

However, there is still a critical need for the Panama Canal to adopt a long-term solution to securing its water supply for the next 50 years. Therefore, on September 7, 2020, the Panama Canal published a Request for Qualifications (RFQ) for the pre-qualification of potential offerors for the engineering, design and construction of a new water management system that will fundamentally change the way Panama handles its water resources. The Canal expects to invest up to $2 billion in this project, making it the waterway’s largest infrastructure undertaking since the Expanded Canal.

To better understand why and how the Panama Canal will approach this project, we spoke with Panama Canal’s Vice President of Water Administration, Daniel Muschett, and Vice President of Water Projects, Jose Reyes, to elaborate on the scope of this project and its long-term impact on the Canal.

Daniel Muschett

What lessons learned from previous projects and the Canal Expansion are you looking to apply to the design and construction of the new water management system? 

First and foremost, the needs and livelihoods of the communities within and outside the Panama Canal watershed are of upmost importance to us. Our experience studying other watersheds across Panama to determine their potential to supply water to the Canal, as well as our track record in the engineering, design and construction of large infrastructure projects have taught us so. We also learned how to work better with our partners across government agencies, multilateral organizations and within the Canal. To that end, we can only achieve our objective to increase water availability and build capacity to manage it by engaging local communities throughout this process, so that they can benefit both economically and socially. 

Can you speak to the innovative aspects of this project? 

We are proud to share there are various innovative components of the new water management system. For instance, the use of information technology, such as sensors, geographic information systems, satellite mapping and data-sharing tools, will allow the Canal to obtain real-time, automated data to ensure an optimal water level for operations year-round. A lynchpin to this effort, research and development will take center stage through the newly created water research center, in partnership with the Technological University of Panama (UTP). Together, we will work to identify innovative solutions that mitigate the effects of climate change on water availability, including deployment of the latest technologies like artificial Intelligence.

We have also infused innovation throughout the project cycle to push for a more sustainable future for Panama and the global maritime industry. Specifically, we will make sure this project will drive improvements to the social and economic wellbeing of the local communities by creating jobs, improving local infrastructure, and advancing the UN Sustainable Development Goals (SDGs).

What is the Panama Canal already doing to conserve water and protect the environment?

The Panama Canal continues to implement measures that conserve water in its operations such as cross-filling lockages, a technique that sends water during transits between the two lanes at the Panamax Locks and already saves the same amount of water used in six lockages each day. Other ongoing measures include the closure of the Gatun hydropower station, elimination of hydraulic assist at the Panamax Locks, use of tandem lockages (two ships in one lockage, whenever possible) and use of water-saving basins at the Neopanamax Locks. The Canal also implemented a series of water measures in February 2020, such as a freshwater fee, a common industry response to low water levels. Together, these efforts have allowed the Canal to secure a steady draft increase after less than three months of implementation. 

The Canal also continued its seasonal measures to protect the migratory paths of whales, dolphins and other large aquatic animals in accordance with the International Maritime Organization (IMO). From August 1 – November 30, 2020, ships must stay within designated navigation areas known as Traffic Separation Schemes (TSS), which decrease the overlap between vessels entering or exiting the Canal and migrating whales.

Jose Reyes

Why is this project different from previous capital investments at the Canal? 

This water management system is different from other major investments because the final outcome will not simply be a piece of infrastructure, but a system that will change how Panama manages its water resources. We are the fifth rainiest country, tied with Costa Rica, and have an opportunity to revolutionize how we think of the future and the control we have over our water sources—from facilitating global trade to providing clean drinking water. This system will afford us an optimal level of water in our navigational channels year-round, which will be even more important as trade patterns continue to change due to the coronavirus. 

This project will also be critical to Panama’s economic recovery from the coronavirus. Though there is no certainty as to how many jobs it will bring just yet, this project will span several years and require many hands-on deck.

Why is water quantity, quality and control a key outcome of the project?

Water is our main priority. We need to guarantee an operational level of water 24/7 and 365 days a year, and secure enough supply for human consumption. An integrated water management system will allow the Canal to have control over the water levels at the Gatun Lake during any season. In order to gain this amount of control, the system will also need to have the necessary technology to properly forecast water levels and effectively control water flow to our navigational channel to ensure sustained operations. To manage water quantity, this new system will improve our water storage capacity, which is especially important when droughts occur, like we saw in 2019. Last but not least, quality is key to this project as we need to ensure that water quality is kept according to standards for drinking water and salinity levels are sufficient for human consumption and optimal for transit operations.

Can you elaborate on the engineering concept of the project?

We have envisioned a few scenarios for this system over the past few years, from segmenting the Gatun Lake for a reservoir to a pipeline that draws water from a lake with higher water levels to the Canal. Ultimately, there is no simple answer or single project that will solve the ever-changing environmental and business challenges impacting the Canal, so we are focused on implementing an integrated system.

The conceptualization of the project will be known once we chose the most qualified firm through the RFQ process. We aim to short-list the most-qualified firms by the end of the year, inviting each to submit their best value proposals for a portfolio of water management projects at the waterway.

Why should companies take part in this project and participate in the RFQ process?

Socially and environmentally conscious bidders should consider applying for this once-in-a-lifetime project that will undoubtedly leave an impact on global trade and Panama for many years to come.
For more information, please visit:
https://apps.pancanal.com/sli/LicitacionesBusqueda/Welcome

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

August

Carefully Choreographed Maintenance, 100 Years in the Making, Completed on the Panama Canal Locks

106 years ago this month, the Panama Canal opened and reshaped world trade forever. Since then, the waterway has seen over a million vessels transit its locks, and come to serve 144 trade routes that connect 1,700 ports across 160 countries today.

The key to the Panama Canal’s continued, smooth operations over the past 106 years? A combination of its committed workforce and a rigorous maintenance program perfected over the past century and modernized with 21st century technology. Both were in full force this month as maintenance was carried out at the Panamax Locks across two days as part of the Panama Canal’s routine efforts to ensure a safe and reliable service.

Carefully Choreographed Maintenance, 100 Years in the Making, Completed on the Panama Canal Locks

To minimize the impact on transits, maintenance was performed simultaneously at the Miraflores and Pedro Miguel Locks between August 25 and 26. This required support from 120 workers and multiple divisions, including the Locks Division, Industrial Shipyards, Engineering and Dredging. While the West Lane of the Locks were closed during this period, transits continued on a regular basis through the Neopanamax Locks, as well as the East Lane of the Panamax Locks.

The floating crane, Titán, aiding maintenance efforts at the Miraflores Locks

At Miraflores, the work involved replacing yoke bushings and girders, which hold the gate when in regular operation. Given the gates at the Miraflores Locks weigh between 353.8 and 662.2 tons, the team brought in the floating Titán crane to lift the gate and then replace the bushings. The efforts took 34 hours to complete.

A gate is lifted as part of routine maintenance at the Miraflores Locks

Meanwhile, tire fenders at the Pedro Miguel Locks were replaced, an endeavor that spanned 12 hours. Gerardo Ríos, infrastructure maintenance foreman for the Pedro Miguel Locks, explained that, “the two fenders help the vessel and the captain align the boat with the chamber. These tires rotate, protecting the infrastructure of the Canal as well as the vessel.”

A reminder of the Panama Canal’s modernization over the past 106 years, the waterway’s fenders were originally constructed with spring-loaded wood, though they have since been upgraded to rubber fenders with a vulcanized layer of very low friction Ultra High Molecular Weight Polyethylene. The fenders used today weigh 14,000 pounds each and are replaced as part of maintenance programs or when they show some level of wear as a result of their intended use.

Maintenance efforts underway at the Miraflores Locks

These efforts are just one of the over 100 maintenance projects that the Panama Canal performs annually. In fact, each year the Panama Canal invests roughly $200 million to sustain the waterway’s infrastructure and equipment, inspecting every structure at the waterway at least once, and analyzing all machinery, buildings, and lock components even more frequently.

With each project, the team plans, announces, and carefully choreographs its moves weeks in advance. This is all to ensure that the Panama Canal’s operations remain smooth and steady today, and for 106 more years to come.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

July

Rebooting Decarbonization: 
The Panama Canal’s Outlook on the Future for Low-Carbon Shipping

By Alexis Rodríguez, Panama Canal Environmental Specialist

Earlier this month, the Panama Canal joined virtual informal talks organized by the International Maritime Organization (IMO). Although focused specifically on short-term measures for reducing GHG from ships, the discussions brought momentum back to the broader, industry-wide efforts around the decarbonization of shipping. These milestones, combined with recent industry announcements, not only signal a turning point in scaling up the shipping sector’s ambitions to achieve decarbonization, but also confirm the Panama Canal’s holistic approach to sustainability and how we can serve as an effective blueprint for maximizing carbon reduction across supply chains.

Early Emissions Ambitions

With more than 90% of the world’s global trade being carried by sea, maritime transport is responsible for 2-3% of global greenhouse (GHG) emissions, according to the IMO. To lessen its environmental impact, the IMO launched an initial strategy in 2018 aimed at securing a low-carbon future for international shipping. The strategy, which is due for revision in 2023, seeks to cut the shipping industry’s GHG emissions per transport work from 2008 levels by at least 40% by 2030, and total annual GHG emissions by at least 50% by 2050 compared to 2008.

The industry and the Panama Canal has made strides in this effort, most notably the adoption of IMO 2020, a regulation mandating that Sulphur content in ships’ fuel oil decrease to 0.5%, from 3.5%. The regulation went into effect on January 1 following years of preparation and coordination and was “implemented successfully without significant disruption” per IMO secretary-general Kitack Lim, signaling the industry’s ability to quickly adapt in the name of sustainability.

However, the conversation soon shifted to the COVID-19 pandemic and related lockdown measures, which caused a sharp decline in global trade. In the first quarter of 2020, merchandise trade shrank by 3% year‑on‑year, according to the World Trade Organization (WTO), and orders for new ships dropped by 53% in the first half of the year, with many other investments and efforts aimed at cutting shipping emissions likely delayed.

A Turning Point

Nevertheless, a few recent developments suggest a renewed commitment to further sustainability across shipping that will carry through in the long run, and that reaffirm the holistic approach to sustainability championed by the Panama Canal. For one, as part of the recently approved recovery package, the European Union voted to include shipping in the EU emissions trading system earlier this month (ETS), and called for the creation of a new fund to back decarbonization efforts in the maritime transport sector.

Secondly, we have seen cargo owners and freight forwarders begin to take on a larger role in the low-carbon transition as consumer demand for sustainable sourcing rises. With supply chain emissions over five times higher than a company’s direct operations, large corporations are carefully looking for opportunities to cut emissions and increasingly selecting suppliers based on their environmental performance.

This has prompted a growing number of leading companies, from consumer brands to shipping lines, to announce new targets and progress in recent weeks. For example, the world’s largest ocean container recorded a decrease in CO2 emissions per container per kilometer by 5.6 percent and 2.5 percent for Dry and Reefer indexes, respectively, in 2019. Schleich GmbH, one of the largest toy manufacturers in Germany, announced last month that it will neutralize its entire sea freight CO2 footprint with the help of Kuehne+Nagel. Unilever and Apple also both recently pledged to have all products and operations be carbon neutral by 2030, following Microsoft, which earlier this year announced it will not only be carbon negative by 2030, but by 2050 will also “remove from the environment all the carbon the company has emitted either directly or by electrical consumption since it was founded in 1975.”

These bold commitments help underscore that decarbonization is good business, marking an exciting turning point for the scaling up of sustainability in shipping. Offering low and ultimately zero-carbon operations are no longer a bonus, but a critical component that must continue to be factored in across a company’s entire value chain, which is where partnership from the Panama Canal and many others will come in.

Optimized Routing to Reduce GHG

At an earlier IMO meeting, Panama presented a document to the IMO entitled: “The optimization of maritime routes as short-term measures to reduce emissions.” It outlined the various factors that impact a ship’s emissions while at sea, ranging from weight of cargo to speed, underscoring that each one must be considered and optimized to cut emissions significantly, a necessary step to meet the IMO’s goal of decreasing CO2 emissions per transport work by at least 40% by 2030 and a total annual GHG emissions by at least 50% by 2050 compared to 2008 across international shipping.

Using insights from the Panama Canal, the proposal called attention to route optimization as a critical tool that, if used across the industry, could offer a tangible, exponential reduction of CO2 and other GHG emissions from ships, in addition to costs, fuel and other savings. An optimal route can amount to up to 10% of GHG reduction potential, based on time reduction and navigation distances, according to the IMO.

Since opening over a century ago, the Canal has become a key proponent for optimized routing, having directly contributed to the reduction of 800 million tons of CO2 emissions. This is in part because the Panama Canal allows shippers travelling from Asia to the U.S. West Coast to save 12 percent and 18 percent fewer emissions compared to the Suez Canal or Cape of Good Hope route, respectively, by shortening the distance and saving time, fuel and additional costs.

The Panama Canal Blueprint

The waterway is more than a shortcut. In recent years, we have built beyond our core offerings through the Panama Canal Green Route Strategy, which aims to maximize our environmental and operational efficiency. This then allows us, as outlined in our own technical paper to the IMO, to directly contribute to customers’ positive initiatives and technical measures to help reduce their CO2 and GHG emissions.

For example, in 2014, the Panama Canal began promoting the IMO’s implementation of nearby transit separation schemes (TSS) and vessel speed reduction programs. Effective August 1 to November 30 each year, the measures reduce the risk of collisions between migrating whales and vessels traveling to and from the waterway, while also lowering their GHG and pollutant gas emissions by an average of 75%, depending on the type, size, and fuel of each vessel. This amounts to over 15,000 tons of CO2.

Two years later, the completion of the Panama Canal Expansion in 2016 significantly expanded the route’s emission savings for shippers by allowing them to transport even greater amounts of cargo in less trips, saving time, fuel and emissions. In its first year, the Expanded Canal saved an estimated 17 million tons of CO2 for shippers, a figure that is expected to swell to 160 million tons by the end of its first decade.

The waterway has also leveraged technology to optimize its all-water route, demonstrating its important role in “digitalization and port calls optimization”, improving operational and environmental efficiency in the logistics industry. In 2017, the Panama Canal partnered with the Panama Maritime Authority and other Panamanian bodies to launch Panama’s Maritime Single Window (VUMPA), streamlining logistics paperwork for international customers passing through the country, a notable feat that required extensive inter-agency coordination and is credited with saving over 300,000 paper forms and 3,200 hours on an annual basis. That same year, the Canal’s Green Connection program also introduced the Emissions Calculator, a tool that allows shippers to measure their GHG emissions per route, including the total emissions saved by choosing the Panama Canal over other routes. Both the VUMPA and Emissions Calculator were upgraded in 2019 to include improved emissions tracking technology.

By taking these steps, the Panama Canal has developed an all-encompassing blueprint for the reduction of CO2 emissions, which we will continue to advocate for and build upon in the months and years ahead alongside our customers and industry peers. Although the COVID-19 pandemic is still a pressing challenge, the subsequent recovery gives us an opportunity to rebuild better. It is critical that we take this moment to come together, raise our ambitions and steer the planet towards a more sustainable and inclusive future.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

June

Ask the Expert: Silvia de Marucci  

This month, the Panama Canal celebrates the 4th anniversary of the Panama Canal Expansion, the waterway’s largest enhancement project since its opening in 1914. Following a decade’s worth of planning and construction, the Expanded Canal was officially inaugurated on June 26, 2016, a historic moment for the waterway, as well as the people of Panama and the global maritime industry. The Expanded Canal has since come to represent the waterway’s ability to adapt and meet the industry’s growing needs, even when it involves taking on unprecedented challenges.

To celebrate this anniversary, we spoke with Silvia de Marucci, Manager of the Market Analysis & Customer Relations Division, to hear about the Expanded Canal’s operations and impact at the Panama Canal so far.

Can you describe the Expanded Canal’s offerings?
The expansion included the construction of a new set of locks on the Atlantic and Pacific sides of the waterway. This created a third lane of traffic that doubled the cargo capacity of the Panama Canal and paved the way for more shipping options, better maritime service, and heightened supply chain reliability.

The Expanded Canal also strengthened the waterway’s value as the green route of maritime trade. For one, despite being 70 feet wider and 18 feet deeper than those in the original Canal, the Neopanamax Locks use less water due to water-savings basins that recycle water during each transit. Their size also allows shippers to consolidate cargo on larger ships that take fewer trips, reducing emissions.

How has the Expanded Canal affected transits over the past four years?
In 2016, the Expanded Canal accounted for 8% of transits at the waterway. Since then, shippers have come to capitalize on the time- and cost-savings offered by the Expanded Canal, bringing new segments, larger quantities of existing segments, and rerouted shipping lines to the waterway. Four years later, the Expanded Canal now represents not only 27% of transits, but also 50% of tonnage at the Panama Canal.

How has the COVID-19 pandemic and related economic impact affected the Expanded Canal?
As the pandemic grew, we acted quickly to safeguard our sustained operations as well as the health of our workforce, customers, and the crew of ships in transit in response to the coronavirus pandemic. In March, the waterway instituted heightened procedures, including a reduction of on-site staff to only those essential for transit operations, and mandating their strict compliance with protocols set forth by the Panamanian health authorities.

So far, transits at the Expanded Canal have remained stable with an average of eight to nine transits per day. The Expanded Canal has also helped bolster the Panama Canal’s role in facilitating the passage of critical global supply chains in recent months, helped in part by the heightened capacity and efficiency provided by the Neopanamax Locks. So far in our 2020 Fiscal Year, over 13 million tons of cooking gas, 107,000 tons of groceries and 4.9 million tons of grains have traveled through the Neopanamax Locks on their way to communities around the world. Since February alone, the Neopanamax Locks have seen over 164,000 tons of wheat, equivalent to the weight of over twenty Eiffel Towers.

What does the future look like for the Panama Canal?
We are tracking temporary and permanent shifts in trade patterns, including a growing shift from global to regional trade, and evaluating ways to adapt our operations accordingly. Despite the current economic situation, we are still advancing plans to invest in our infrastructure, processes, and people, so we are prepared for our industry’s recovery and growth down the road.
 
One such opportunity includes implementing a long-term solution for water, which will strengthen the Panama Canal’s operational reliability for years to come. This is a top priority for our team, and one that may become the waterway’s second largest capital investment, second only to Expansion.

As the Administrator wrote in May, we see the Expanded Canal as a testament to our commitment to investing ambitiously in our future. For us, the Expansion is still just the beginning of our bright future as the logistics hub of the Americas.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

May

Panama Canal Secures Steady Draft, Operational Reliability Following Water Measures

Earlier this year, the Panama Canal implemented water saving measures after experiencing the fifth driest year at the Canal in 70 years. Thanks to the long-standing partnership with our customers and their flexibility to adapt to these measures, the Panama Canal has now emerged from its dry season equipped to ensure a competitive draft, and thus steady operations for months to come. Having an operational level of water and transit reliability in the second half of 2020 will be critical for the waterway as it advances its search for long-term water solutions and prepares for coronavirus-driven shifts in trade, as the Panama Canal Administrator outlined earlier this month.

The waterway has carefully monitored its operational water usage since the end of 2018, when rainfall at the watershed was 20 percent below the historic average. This unprecedented drought severely constrained water levels at Gatun and Alhajuela Lakes, the main sources of water for the Canal and half of Panama’s population. Despite the extensive use of water conservation tactics across Canal operations, inadequate draft levels were still projected to significantly restrict cargo transiting the waterway if no further interventions were made.

As a result, on February 15, the Panama Canal adopted a series of bold measures to sustain an operational level of water, including a freshwater surcharge informed by daily water level data at Gatun Lake, a profit-neutral measure that is also a standard practice across the industry. The reservation system was also altered to increase certainty around transit schedules, which allowed for more efficient use of water resources and conservation tactics, such as cross-filling lockages, an innovative technique developed by the Canal team that saves the same amount of water used in six lockages each day by sending water between the two lanes during transits at the Panamax Locks.

The February measures also built upon the progress made by the Canal’s many long-standing conservation initiatives. As one example, the Environmental Economic Incentives Program, or PIEA in Spanish, works to ensure families living along the watershed have the resources, education and other incentives to invest in the long-term sustainability of their property and the surrounding environment. The program has led to reduced rates of runoff and water usage in such communities, as well as the reforestation of over 22,000 acres of land, with over five million seeds planted and 3.5 million tons of C02 captured.

Now, less than three months after the conservation measures were implemented, the water levels at Gatun Lake can accommodate a steady 45-foot draft, higher than projected for the start of the rainy season, which is expected to begin mid-May. Panama’s rainy season official start date will be determined by various environmental factors, such as wind speed, rainfall in the watershed, ocean temperatures in the Gulf of Panama, among other metrics.

On top of minimizing draft restrictions, the Canal has provided relief to its customers during this time of instability by adjusting its reservation system. Developed in response to input gathered by the Panama Canal’s leadership from top customers, the changes introduced late last month offer extended flexibility surrounding fees and swapping booking slots.

Ultimately, this renewed draft reliability will help bolster the resilience of the Panama Canal route in the months ahead as the industry faces economic uncertainty in the aftermath of the coronavirus pandemic. Nonetheless, the Panama Canal’s search for long-term solutions continues. By the end of the year, the team aims to not only request and review engineering proposals, and after that, begin constructing a long-term solution. Having a steady water supply is a top priority for the Canal, and so we will partner with innovative engineers to ensure that we can maintain our reliable service for years to come.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

April

Our Commitment to Safe, Continued World Trade

Despite the challenging and unpredictable future our world faces, I would like to offer some certainty on behalf of our team at the waterway.

The Panama Canal is operating as normal today and will continue to work with the personnel needed to ensure normal transit operations in the weeks to come.

For over 105 years, we have provided a reliable service to global supply chain, adapting however needed through a century’s worth of ebbs and flows to ensure our route remains open for the communities and economies that depend on it. Now more than ever, we are committed to upholding this service.

To achieve this, we are following an evolving set of COVID-19 response protocols, developed and coordinated with the Ministry of Health of Panama (MINSA) to guarantee our safe and sustained operations, and safeguard the health and wellbeing of our workforce and our customer’s crews.

We began with adopting a series of safety procedures across our operations in January, which have since escalated across our workforce. Recent changes include the reduction of our on-site staff to only those essential to transit operations, and their strict compliance with the guidance set forth by the Panamanian health authorities for all vessel transits, among other efforts.

Throughout this difficult period, our team has remained dedicated and diligent. While we have had some reported cases of COVID-19 among our near 10,000 employees, none has been related to the transit operation, and the Canal will continue to maintain stringent hygiene standards to ensure the safety of our personnel and customers’ crews.

As we begin to better understand the real human and economic impacts of the COVID-19 pandemic, the Panama Canal team is committed to navigating this new normal head-on to ensure much-needed global supplies and solutions are moving swiftly to their final destinations.
We are grateful to support those around the world who are working to keep our global supply chains moving and our communities and families safe.

Sincerely,


Dr. Ricaurte Vásquez Morales
Panama Canal Administrator

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

March

The Panama Canal‘s Precautionary Actions Against COVID-19

The Panama Canal is closely monitoring the evolving COVID-19 outbreak and has adopted a series of measures to protect its personnel and prevent further spread of the virus.

Since January, ships arriving at the waterway have been required to report if they have visited countries with confirmed cases prior to their arrival. This builds off, and has been followed by, a series of additional actions taken at the waterway.

Vessel Transit Measures

The Panama Canal’s inspection and control personnel already work tirelessly to ensure compliance with regulations on health and prevention of contagious diseases within its waters.

These inspections for contagious risk issues have been carried out for years and are required for all vessels that arrive in the Panama Canal waters.

The existing controls are:

  • The vessel is required to report its conditions on board and does so through the Panama Maritime Single Window System (VUMPA, its acronym in Spanish). In the case of non-compliance and/or providing false information, the vessel is subject to penalties and/or restrictions.
  • A Panama Canal admeasurer embarks and confirms the questions included in the Maritime Health Declaration through a form previously completed in the VUMPA.
  • The admeasurer also questions once again the vessel’s captain or officer in charge in order to reconfirm that there are no sick people or crewmembers showing symptoms on board.
  • If there are any confirmed or suspected cases on board and depending on the symptoms it is concluded that there is a relevant disease on board, the Maritime Health Unit of Panama’s Ministry of Health (MINSA, its acronym in Spanish) is called onboard. During this time, boarding and disembarking is prohibited for people and the yellow flag is flown, denoting that the ship is under quarantine.
  • Next steps are determined following MINSA’s inspection.

In response to COVID-19, the following additional measures have also been taken at the Panama Canal:

  • Vessels are required to report if and when crew changes occurred within 14 days of arrival at ports with COVID-19 cases to MINSA.
  • Panama Canal admeasurers must contact vessels via radio before boarding to confirm all crewmembers onboard are healthy and to verify any recent crew changes.
  • Panama Canal personnel are equipped with masks and alcohol-based hand sanitizer gel.
  • Constant communication is maintained between the Panama Canal and MINSA’s maritime health doctors.
  • MINSA has sent a communication to all shipping companies, requiring that they report any person who has any illness-related symptoms, regardless of whether or not they are related to COVID-19.
About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

February

The Panama Canal’s Creative Conservation Tools, by the Numbers

The industry is facing a new reality today as unpredictable weather patterns impact supply chains across the world. In recent years, places like the Port of Montreal in Canada and the Rhine River in Europe have already experienced historically low precipitation rates, forcing each to undertake immediate actions to ensure operational water levels. Now facing a similar challenge, the Panama Canal is also moving forward the only way it knows how—by building resourceful, innovative solutions that keep global maritime trade running smoothly.

In addition to accelerating its search for long-term remedies, the waterway has invested in a series of tools and community programs to strengthen the sustainability of its watershed. Together, they embody the Canal’s creative, community-oriented approach to conservation, and have already made a clear impact, as made clear by the numbers below:

8 Drone Surveillance Flights

The Panama Canal works with Panama’s Ministry of Environment to combat illegal logging and deforestation. The Canal team does so, in part, by using technology, including drones, to monitor forest coverage in the Chagres National Park, which is the source of 44 percent of water in the watershed. In the Fiscal Year 2019, the Canal team completed eight surveillance flights, as well as nine land tours, to monitor the forest coverage and hear updates from individuals across the watershed.

8,167 Land Property Titles

The Panama Canal distributes land titles to families living along the shore of Gatun Lake as part of an effort to ensure legal security for inhabitants of the watershed. By doing so, it also aims to encourage inhabitants to invest in the long-term sustainability of their property and the surrounding environment, in line with a 2016 study by the World Resources Institute (WRI), which found that securing land rights for indigenous and local communities can lead to significant environmental, economic and social benefits. Just last month, the Panama Canal surpassed 8,000 property titles awarded to over 14,000 beneficiaries, some of whom waited decades for land titles, and now have access to bank loans, educational programs, and other formal benefits.

1,000,000 Coffee Plants  

The efficient maintenance of the local water supply is crucial for not only the communities living in the watershed, but also the operation of the Canal. As such, the waterway has partnered with local farmers through its Economic Environmental Incentives Program (PIEA), equipping them with the resources, education programs and other incentives needed to ensure sustainable development in the region. This includes educating participants on sustainable farming practices, such as planting trees to provide shade for their coffee plants and prevent erosion rather than clearing land through less environmentally conscious methods like slash-and-burn. The program has so far led to over a million coffee seedlings planted, among countless other crops, reflecting an unprecedented model of a green economy that serves to benefit the Canal, its neighbors and their shared, productive future.

22,239 Acres Restored

The Canal team is also making strides to reforest broad swaths on land in the watershed as part of PIEA in an effort to promote biodiversity, carbon sequestration and environmental stewardship. The Canal has so far reforested over 22,000 acres of land, with over five million seeds planted and 3.5 million tons of C02 captured. Within the next five years, the waterway aims to reforest at least an additional 10,000 acres.

550 Students, 60 Teachers and 100 Parents

To ensure this spirit of conservation continues in the decades to come, the Panama launched the Watershed Guardians Program last year, educating 550 students, 60 teachers and 100 parents on the value of protecting the watershed. The waterway also hosted over a thousand students for an Environmental Awareness Festival and similar events to further encourage the next generation to explore green commerce and ensure a more sustainable future across Panama and the world.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.

January

Protecting the Canal’s Water Now for a Sustainable Future

Earlier this month, the Panama Canal announced new measures aimed at sustaining an operational level of water and providing reliability to customers as it implements a long-term solution to water. Before the new measures go into effect on February 15, we thought we would revisit the innovative measures already in place by sharing a few frequently asked questions on the topic. Check out our responses below to learn how coffee, cross-filling lockages and other innovative solutions are already helping save water at the Panama Canal.

Why are water conservation measures needed at the Panama Canal?
In 2019, rainfall at the Panama Canal watershed was 20 percent below the historic average, marking the fifth driest year in 70 years. It follows several years of lower than average rainfall coupled by a 10 percent increase in water evaporation levels due to a 0.5-1.5-degree Celsius rise in temperature. Together, this has led to persistently low water levels at Gatun Lake.

What is the Canal currently doing to save water in its operations?
One of the main conservation measures is the use of cross-filling lockages at the Panamax Locks. This technique sends water during transits between the two lanes at the Panamax Locks to optimize the transfer of water between chambers and reduce discharge to the sea. Each day, cross-filling is already saving the Canal the same amount of water used in six lockages. Watch the video below to see how this technique works:

In addition to cross-filling lockages, the Panama Canal has suspended power generation at the Gatun Hydroelectric Plant and hydraulic assistance at the Panamax Locks, the latter of which expedites transits, but requires more use of water. The Canal team also uses water-saving basins at the Neopanamax Locks, and, when vessel sizes allow, coordinates tandem lockages, transiting two ships in the same lock at the same time to save water.

Is the Canal doing anything else to save water?
The Panama Canal has long recognized water as its principal resource, implementing and expanding a myriad of programs that stretch beyond its operations in the name of conservation. One of the Canal’s core programs is the Environmental Economic Incentives Program, or PIEA in Spanish, which offers land titles and sustainable farming classes to local farmers, who in turn, reforest, protect, and cultivate more than 21,000 acres of the local watershed, with coffee as a key crop. The program’s efforts have led to greater yields for farmers, while preventing runoff, ensuring more arable land for future use and preserving water resources and the environment.

So far, results for PIEA are impressive:

  • 126 villages and 1,653 farms benefiting from the program in the watershed
  • 15,000+ land titles delivered
  • 9,000 hectares (22,239 acres) of land reforested
  • 1,600 acres (647.5 hectares) of forest land protected
  • 5,300,000 seeds planted
  • 175% increase in coffee production in the region
  • 4,000+ hectares (9,884 acres) expected to be reforested within the next five years

What is the Panama Canal considering as a potential long-term solution for water management?
The Canal is analyzing and identifying long-term solutions to water availability. The team is currently discussing a series of options to draw water from a lake outside the Watershed, as well as a dam in Gatun Lake that would increase water storage and regulate water flow.

About the Panama Canal
The Panama Canal Authority is an autonomous legal entity of the Republic of Panama in charge of the operation, administration, management, preservation, maintenance, and modernization of the Panama Canal, as well as its activities and related services, so that the Canal may operate in a safe, continuous, efficient manner. For more information, please refer to the Canal’s website: http://www.pancanal.com or follow us on Twitter @thepanamacanal.