Canal in search of more water

In a special report ahead of Maritime Week Americas, Michele Labrut looks at a new challenge facing the Panama Canal as well as opportunities for the country’s ports and maritime cluster in general.


Climate change and massive domestic water consumption are affecting the levels of the lakes feeding in water to the Panama Canal. Those factors combined with changes in trade flows have become the biggest challenges for the Panama Canal Administrator, Dr. Ricaurte Vasquez.

‘We must face the reality [that] our priority is water,’ Vasquez told Seatrade, adding that the Canal needs to have a reliable level of water and control over its supply for the future.

A renowned economist, Vasquez’ designation at the helm of the waterway was widely applauded when he took office last September. He has both corporate business experience and a knowledge of the Canal’s challenges as he earlier filled various positions including president of the Canal board of directors and minister of Canal Affairs.

‘We cannot forget that the main asset of our operation is water, and that it is being affected by climate change, impacting rain patterns and, consequently, the capacity to supply the lakes that supply water to more than half of the population of the country and give reliability to the transit of ships,’ he said.

Last year, concluded as the fifth lowest year of the last 70 years in terms of rainfall in the Canal River Basin. Besides the lack of rainfall, 20% below average, water evaporation has also increased by 10% due to the almost unpredictable temperature variations as result of global warming.

‘We have to operate the Canal against all odds. The global market is not growing and even less the Transoceanic trade, which is the Canal’s main market, so we need to adapt to the new trade flows,’ he said. At the moment, finding additional sources of water is top priority for the Canal executives.

Vasquez revealed that the Panama Canal Authority (ACP) is considering several options including building small dams on the Trinidad river, in Gatun Lake, and eventually connecting the Bayano hydroelectric plant with a pipeline to one of the Canal’s operational lakes and several other possibilities under study.

Shortly after he was interviewed by Seatrade, Vasquez announced a series of Canal-related measures including adding fees and a fresh water tax. The changes were a response to declining levels of water at Gatun Lake, a 425sq km artificial lake that constitutes most of the Panama Canal and carries ships for about 33km above the waterway.

The measures, which were due to enter force mid-February, are designed ensure ‘an operational level of water and provide reliability to customers while it implements a long-term solution to water.’ The changes will ‘sustain water levels and minimise impacts on customers,’ the ACP said in a statement.

The measures include: a Fresh Water Surcharge, that is to say a fixed fee of $10,000 that will be applied to all transiting vessels over 38.1mtr (125ft) in LOA. In addition, a variable fee ranging from a minimum of 1% to a maximum of 10% of the vessel’s toll will be applied. The percentage to be applied will depend on Gatun Lake level at the time of transit. The official lake level will be published daily, as well as forecasted for the following two months.

Last year, the ACP issued seven restrictions on draught levels for ships. Draught levels on the new Neopanamax locks went from 49ft down to 43ft. In FY 2019, the Panama Canal had 12,281 transits, a slight increase from the year prior.

The Canal Authority will also impose limits on the number of booking slots available to 21 for ships above 91ft in width, and six for those below.

The Panama Canal has been implementing cross-filling lockages, a technique that sends water between the two lanes at the Panamax Locks during transits and saves an amount of water equivalent to that used in six lockages each day, the ACP said in its statement.




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