The Panama Canal is Open

By Alexei Oduber, Managing Director, GAC Panama

Amid misinformation, rumour and false reports that the Panama Canal has closed, it's essential to set the record straight – the Canal is fully operational and functioning seamlessly.

Since February of this year, the Panama Canal Authority (ACP) announced the implementation of limited transit drafts, a practice it has employed many times in the past during the summer season and periods of restricted water levels.

In anticipation of a drought this year, additional draft restrictions were progressively implemented. And as the most pessimistic predictions have become reality, the ACP implemented further measures to address the backlog and minimise delays for vessels waiting to transit.

The first measure, implemented on 8 August 2023, was to activate Condition 3 - this condition is reserved for when the projections show that 90 or more vessels will be awaiting transit at both terminals for at least two consecutive days in the coming 48 hours. It also removed the third period booking slots. This gives vessels the option to transit without having to participate in costly auctions. These measures will stay in force until 2 September 2023.

By taking prompt action, the ACP has addressed the operational challenges and successfully alleviated the backlog. The number of vessels waiting for transit has decreased from 167 on 8 August 2023 to 134 on 29 August 2023.

From Conservation to Expansion

Given the unpredictable nature of rainfall in Panama, the ACP prioritizes watershed preservation projects to ensure a consistent water supply - both for Panamanians and to ensure the Canal’s continued operations.

Water Conservation Strategy

Under the Water Projects Program, the ACP has signed an agreement with the US Army Corps of Engineers (USACE) to achieve an optimized water management system. It covers a portfolio of projects designed to provide a raw water supply solution for over half of the country's population, including the provinces of Panama, Colon and West Panama. It also addresses the Canal’s water needs, considering sustainable development, climate scenarios and growth projections. USACE’s involvement includes reviewing existing studies, identifying and executing required evaluations, developing models and simulations, and preparing conceptual designs, among other program activities.

The ACP has also announced further measures including the acquisition and use of 25,000 hectares on the west side of the Panama Canal as part of a comprehensive strategy to address multiple aspects of the waterway’s functionality and sustainability. This multifaceted approach is closely tied to the Canal’s expansion and encompasses various initiatives aimed at conserving water resources, optimizing transit operations and ensuring the long-term viability of the waterway.

A pivotal aspect is the focus on watershed preservation, which involves meticulous management and protection of natural areas around the Canal's water sources. These areas play a vital role in maintaining water quality for consumption purposes, preventing erosion and sustaining the ecosystem. Moreover, the ACP is exploring the establishment of an additional logistical route on the west side of the Canal to alleviate congestion around critical points such as the Bridge of the Americas and Panama City.

Navigating Forward

The next ten months will serve as a testing ground for the three crucial components of the ACP’s water conservation strategy. The first involves limiting transits to 32 vessels per day. The second implements a draft limit of 44 feet TFW for NeoPanamax vessels, while maintaining 39.5 feet for Panamax ships. Combined with land-based routes and railways, this approach will cater to container carriers, the primary users of the NeoPanamax Locks. Thirdly, the introduction of cross water lockage involving the controlled transfer of water between lock chambers will optimise water usage during vessel transits.

Balancing the Flow

Further actions that could significantly contribute to water conservation include limiting water loss through evaporation from the chambers, ultimately minimizing unnecessary water depletion.

Another proactive measure involves the reuse of water in the Canal's chambers. Redirecting water from the last chamber to preceding ones while preserving water quality standards for drinking purposes could enable optimal water usage.

Furthermore, addressing water loss from Panama’s Water Works (known as IDAAN – Instituto de Acueductos y Alcantarillados Nacionales in Spanish) presents an opportunity to extend water conservation efforts beyond the Canal's immediate operations. While the initial two actions are straightforward, the significance of the last one lies in its potential to ensure water supply for the broader Panama region. Considering that IDAAN reports that 40% of the daily water production of 521 million gallons is lost before reaching consumers, rectifying this issue would be equivalent to four lockages per day and would secure the city’s water supply.

Despite the challenges of climatic fluctuation and increased maritime traffic, one thing remains clear: the Panama Canal is not just open for business, it's charting a course towards a more sustainable future.

Keeping well-informed and getting accurate, up-to-date information about Canal operations is paramount - and that's where your shipping agent comes in. By staying in touch with them, you can ensure that you have the latest updates and insights to help you plan your transit.

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