Panama Canal expansion project

The Panama Canal expansion project, also called the Third Set of Locks Project, doubled the capacity of the Panama Canal by adding a new lane of traffic allowing for a larger number of ships, and increasing the width and depth of the lanes and locks allowing larger ships to pass. The new larger size of ships, called New Panamax, are about one and a half times the previous Panamax size and can carry over twice as much cargo. The expanded canal began commercial operation on 26 June 2016.

The project has:

Then-Panamanian President Martín Torrijos formally proposed the project on 24 April 2006, saying it would transform Panama into a First World country. A national referendum approved the proposal by a 76.8 percent majority on 22 October, and the Cabinet and National Assembly followed suit. The project formally began in 2007. It was initially announced that the Canal expansion would be completed by August 2014 to coincide with the 100th anniversary of the opening of the Panama Canal but various setbacks, including strikes and disputes with the construction consortium over cost overruns, pushed the completion date several times. Following additional difficulties including seepage from the new locks, the expansion was opened on 26 June 2016. The expansion doubled the Canal’s capacity, and has a direct impact on economies of scale and international maritime trade.

The project is expected to create demand for ports to handle New Panamax ships. Several U.S. Eastern Seaboard ports will be ready for these larger ships, and others are considering renovations, including dredging, blasting, and bridge raising. In the UK, the Port of Southampton can handle post-Panamax vessels and is expanding to accommodate more; the Port of Liverpool was anticipated to be capable by 2015, although was delayed until mid-2016; and others are considering such expansion.

The original Panama Canal has a limited capacity determined by operational times and cycles of the existing locks and further constrained by the current trend towards larger (close to Panamax-sized) vessels transiting the canal, requiring more transit time in the locks and channels. Also, periodic maintenance on the aging canal requires shutdowns of this waterway. Demand is growing due to the growth of international trade, and many users require a guaranteed level of service. Despite the gains which have been made in efficiency, the Panama Canal Authority (ACP) estimated that the canal would reach its maximum sustainable capacity between 2009 and 2012. The long-term solution for the congestion was the expansion of the canal with a third set of locks.

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