The Panama Canal expansion will be officially inaugurated on June 26, 2016.
The canal, which links the Atlantic and Pacific Oceans, underwent an extensive renovation to allow larger cargo ships through its locks, due to the fact that larger modern shipping vessels have literally “out-grown” this vital trade passageway. Post-Panamax vessels transport represent approximately 45 percent of the world’s cargo and so this project was crucial for not only Panama’s economy but also for the industry as it currently handles 6% of world trade.
It is the canal’s third locks that have been the centrepiece of the canal’s expansion program, which was launched in 2007 with an initial budget of $5.25 billion. These third locks are those that will enable the canal to accommodate New Panamax ships, known as Neopanamax.
Once these locks are in operation, vessels carrying 3 time the current capacity will be able to transit through the canal. These vessels that are members of what are commonly referred to as “megaships”, can carry up to 13,200 TEUs.
The inauguration ceremony will take place at the Cocoli locks on the Pacific side. China COSCO Shipping’s container vessel Andronikos will make the first-ever transit through the expanded waterway after they won a lottery clinching the pioneering transit.
The first commercial transit reservation was granted to the Neopanamax, 120-foot wide a liquefied petroleum gas (LPG) tanker Linden Pride of Nippon Yusen Kaisha (NYK Line). More than 100 Neopanamax ships have already made reservations for commercial transit through the new locks thus far.
Leaders from 70 countries that currently use the canal, including the United States have been invited to attend the upcoming inauguration. The United States being the biggest user of the Panama Canal, followed by China and Chile.
Completion of the expansion project was originally scheduled for 2014, however it was plagued by delays and push backs on several occasions due to repairs, strikes and contractual disputes. With all that in the past the industry can, from June 26, exploit the wider canal with its mega ships. Better late than never.
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