Panama Canal expansion project facts for kids
The Panama Canal expansion project (Spanish: ampliación del Canal de Panamá), also known as the Third Set of Locks Project, made the Panama Canal much bigger. It added a new lane for ships, making the canal wider and deeper. This allows larger ships, called New Panamax vessels, to pass through. These new ships are about one and a half times bigger than the old ones (Panamax) and can carry more than twice as much cargo. The expanded canal officially opened for business on June 26, 2016.
The project did several important things:
- It built two new sets of locks, one on the Atlantic Ocean side and one on the Pacific Ocean side. It also dug new channels to reach these locks.
- It made the existing channels wider and deeper.
- It raised the highest water level of Gatun Lake.
The President of Panama at the time, Martín Torrijos, first suggested this project on April 24, 2006. He said it would help Panama become a very developed country. People in Panama voted on the idea in a special election on October 22, 2006, and 76.8 percent said yes! The project officially started in 2007.
The plan was to finish the expansion by August 2014, just in time for the canal's 100th birthday. However, there were some problems, like worker strikes and disagreements over costs. These issues caused delays. After fixing some leaks in the new locks, the expanded canal finally opened on June 26, 2016. This expansion doubled how much cargo the canal could handle. By March 2, 2018, 3,000 New Panamax ships had already used the expanded canal in its first 20 months!
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Why the Canal Needed to Grow
The original Panama Canal had a limit to how many ships it could handle each day. This was because of how long it took for ships to go through the existing locks. Also, more and more ships were becoming very large (almost Panamax size), which took even longer to pass through. Sometimes, the canal also needed to close for repairs because it was getting old.
Global trade was growing, and many shipping companies needed a reliable way to move goods. Even though the canal became more efficient, the Panama Canal Authority (ACP) thought the canal would reach its maximum capacity between 2009 and 2012. The best long-term solution for this traffic jam was to expand the canal with a third set of locks.
The size of ships that could use the old canal, called Panamax ships, was limited by the size of the locks. These locks were about 33.5 meters (110 feet) wide, 320 meters (1050 feet) long, and 12.5 meters (41.2 feet) deep. The new, third set of locks allows much larger ships, called Post-Panamax ships, to pass through. These ships can carry a lot more cargo. The new lock chambers are about 55 meters (180 feet) wide, 427 meters (1400 feet) long, and 18.3 meters (60 feet) deep. These new sizes mean that about 79% of all cargo ships in the world can now use the canal, up from only 45% before!
Since the 1930s, studies have shown that building a third, larger set of locks was the best way to make the canal bigger. The United States even started digging for new locks in 1939 but stopped in 1942 because of World War II. Later studies by the Panama Canal Authority (Spanish: Autoridad del Canal de Panamá (ACP)) also confirmed that a third, larger set of locks was the best and most environmentally friendly choice.
Former President Martín Torrijos explained the project in 2006. He said the canal "is like our 'petroleum'." He meant that just like oil needs to be taken out of the ground to be valuable, the canal needed to grow to handle more cargo and bring more money to Panama.
While the expansion was being built, and because ships had high operating costs and sometimes waited for days, the ACP created a special system. Ships could pay an extra fee to book a specific time to cross the canal, guaranteeing they would pass in 18 hours or less. This helped manage the busy traffic and offered better service to shipping companies.
How Much Cargo Moves Through the Canal?
The Panama Canal Authority expects the amount of cargo passing through the canal to grow by about 3% each year. This means the amount of cargo could double by 2025 compared to 2005. Allowing bigger ships to use the canal means more cargo can move with each trip, using less water per ton of goods.
Historically, the canal made most of its money from carrying bulk goods like grains (corn, soy, wheat), minerals, fertilizers, coal, and liquids like chemicals and oil. More recently, goods shipped in containers became the canal's main source of income, pushing bulk cargo to second place. Car carriers became the third biggest income generator. Experts believe the canal expansion will be good for both the canal and its users because it can handle more cargo.
The increase in canal use in recent years was mostly due to more goods from China coming to the US East and Gulf coasts. However, some people worried that this trade imbalance might not last forever. The ACP, though, believed trade would continue to grow for a long time.
Critics of the expansion, like former canal administrator Fernando Manfredo, argued that it's hard to predict canal usage so far into the future. They thought it was risky to base Panama's financial future on such predictions.
Who Competes with the Panama Canal?
The Panama Canal faces competition from other ways to transport cargo between the same places.
One possible future competitor is the Northern Sea Route in Russia and the Canadian Northwest Passage. These routes through the Arctic Ocean could open for more months each year as waters get warmer. However, these routes would need a lot of money for special escort ships and ports. Experts don't expect these Arctic routes to be a real alternative to the Panama Canal for another 10 to 20 years.
The two main current competitors are the US intermodal system (which uses different types of transport like trains and trucks) and the Suez Canal in Egypt. Ports and distribution centers along these routes are investing in their facilities to handle large Post-Panamax container ships. The ACP believes that more and more large ships will be used on routes that compete with Panama.
The expansion project aimed to make the canal stronger against this competition. By being able to handle more demand, Panama could become a major connection point for trade between continents. This would help the canal stay important for world trade and continue to help Panama grow.
What Were the Predictions?
Studies by the ACP in 2005 predicted that the canal would reach its maximum capacity between 2009 and 2012. Once it reached this limit, it wouldn't be able to handle more growth in demand. This would make the Panama maritime route less competitive.
The construction for the expansion was planned to finish by April 2016. The ACP said it would do everything possible to handle traffic until the new locks were ready.
The expanded canal, with its third set of locks, was expected to handle all the predicted demand until 2025 and beyond. Together, the old and new locks roughly double the canal's capacity.
Some critics, like former politician Keith Holder, pointed out that canal usage changes with the seasons. Even during the busiest months, they argued that the main slowdown wasn't the locks but the narrow Culebra Cut. This part of the canal has limited space for large ships to pass each other.
Even though the canal was getting close to its maximum capacity, it didn't mean ships couldn't use it. It just meant the canal's ability to grow was slowing down, and it couldn't take on more cargo.
Thomas Drohan, a former head of the Panama Canal's dredging division and a critic of the expansion, said that if a service becomes scarce, businesses can raise their prices. He suggested this could apply to Panama Canal tolls.
The Expansion Project Details
New Locks
The original canal has two lanes, each with its own set of locks. The expansion project added a third lane by building new lock complexes at each end of the canal. One new lock complex is on the Pacific side, near the existing Miraflores Locks. The other is on the Atlantic side, east of the existing Gatun Locks. Each of these new lock complexes has three connected chambers. These chambers lift ships from sea level to the level of Gatun Lake and then lower them back down.
Each chamber has three special water-saving basins next to it. This means there are nine basins per lock complex, making 18 basins in total. Just like the original locks, the new locks and their basins fill and empty using only gravity, without any pumps. The new locks were built in an area that the United States started digging in 1939 but stopped in 1942. The new locks are connected to the existing canal system by new channels. The new lock chambers are 427 meters (1400 feet) long, 55 meters (180 feet) wide, and 18.3 meters (60 feet) deep. They use rolling gates instead of the swinging gates found in the old locks. Rolling gates are common in large locks and are a proven technology. The new locks use tugboats to guide ships, instead of the electric locomotives used in the old locks. Tugboats are also widely used for this purpose in similar large locks.
How Water is Saved in the Locks
The new locks have special water-saving basins. These basins help reduce the amount of water needed for each ship to pass through. Both the old and new locks use gravity and valves to operate; no pumps are involved.
All the locks use water from Gatun Lake. In the dry season, the lake's water level can get low. Adding a third set of locks meant finding a way to manage this water supply.
For the new locks, three basins are connected to each lock chamber. When a ship goes through, only two-fifths of the water in the chamber is "lost" to the sea. The other three-fifths is saved and reused! This is a clever way to save water.
The water used for each lock cycle is the amount of water that flows into the first (upper) lock chamber from Gatun Lake. To reduce this, you would need to make the chamber narrower, shorter, or reduce the height it lifts ships. The new locks already divide the total 26-meter (85-foot) lift into three smaller steps, which saves water compared to one huge lock.
Here's how the water-saving basins work: Imagine the water in a lock chamber is divided into five equal "slices." When the canal first starts, the chamber is filled from Gatun Lake. Then, when emptying the chamber, the top three slices of water are emptied, one by one, into three separate basins, each at a slightly lower level. The bottom two slices of water are released into the next lock chamber and eventually go to the sea.
When the lock moves a ship upward, the water from the lowest basin is let into the chamber first. Then water from the other basins fills the chamber further. Finally, the last two slices of water come from Gatun Lake. This means only two-fifths of the water needed to fill the chamber comes directly from the lake, saving a lot of water!
New Channels for Ships
The plan included digging a 3.2-kilometer (2-mile) long access channel to connect the new Atlantic locks to the existing sea entrance of the canal. On the Pacific side, two new access channels were built:
- The 6.2-kilometer (3.9-mile) north access channel connects the new Pacific-side lock to the Culebra Cut. This channel goes around Miraflores Lake.
- The 1.8-kilometer (1.1-mile) south access channel connects the new lock to the existing Pacific Ocean entrance.
These new channels on both sides are at least 218 meters (715 feet) wide. This allows Post-Panamax ships to travel in one direction at a time.
Raising Gatun Lake's Water Level
The highest operating water level of Gatun Lake was raised by about 0.45 meters (1.5 feet). This, along with making the channels wider and deeper, increased the amount of usable water in Gatun Lake. This extra water means the canal can provide about 165 million US gallons (625,000 cubic meters) of additional water each day. This is enough for about 1,100 extra lock operations per year, without affecting the water supply for people, which also comes from Gatun and Alhajuela Lakes.
Building the Expansion
The construction of the third set of locks was originally expected to take seven or eight years. The new locks were supposed to open between 2014 and 2015, around 100 years after the canal first opened. However, in July 2012, it was announced that the project was six months behind schedule. This pushed the opening date to April 2015. By September 2014, the new gates were expected to open in "early 2016."
In October 2011, the Panama Canal Authority announced that they had finished the third phase of digging for the Pacific access channel.
In June 2012, a huge 30-meter (100-foot) tall concrete block was completed. This was the first of 46 such blocks that form the walls of the new Pacific-side lock.
Sixteen new lock gates were installed as part of the expansion: eight on the Atlantic side and eight on the Pacific side. The installation started in December 2014 with a 3,285-ton gate on the Atlantic side. It finished in April 2015 with a 4,232-ton gate on the Pacific side.
In June 2015, the new locks began to be filled with water, first on the Atlantic side, then on the Pacific. By then, the canal's re-opening was planned for April 2016.
In August 2015, a crack was reported in a concrete part of the new Cocoli locks. At first, it wasn't expected to delay the project. However, by November 2015, other cracks found earlier threatened to cause delays. Luckily, the repairs to strengthen the sills were expected to be finished by January 2016. In early February 2016, the ACP confirmed that the repairs were complete.
By January 2016, Panama's President Varela said he expected the expansion to be finished around May 2016. The expanded canal officially began commercial operation on June 26, 2016. The very first ship to cross using the new locks was a modern New Panamax vessel, the Chinese container ship "Cosco Shipping Panama."
Money for the Project
The main goal of the canal expansion was to help Panama earn more money from the increasing ship traffic. This traffic included both more cargo and bigger ships. With the third set of locks, the canal could handle the expected demand beyond 2025. It was predicted that the total income for that year would be over $6.2 billion US dollars.
How Much Did It Cost?
In 2006, the ACP estimated the cost of the third set of locks project at US$5.25 billion. This amount included everything: design, management, construction, testing, environmental protection, and a fund for unexpected problems like accidents or delays. The biggest costs were building the two new lock complexes, one on each side of the canal.
Some people who disagreed with the project said that the cost estimates were based on uncertain predictions about world trade. They also worried that the project would cost much more than planned and was too risky for Panama.
How Was It Paid For?
The ACP believed the project would make a good profit. The money for the project was kept separate from the government's regular budget. The government did not guarantee any loans taken by the ACP for the project. It was expected that the project would need about US$2.3 billion in loans during the busiest construction times.
The ACP's predictions for income were based on the idea that more ships would use the canal and that companies would be willing to pay higher fees. To attract new business, the ACP planned to offer special deals, like a loyalty program. With the money earned from the expanded canal, the costs were expected to be paid back in less than 10 years.
The US$2.3 billion loan package for the expansion was signed in December 2008, during a global financial crisis. Loans came from several government-owned financial institutions:
- Japan Bank for International Cooperation (JBIC)—US$800 million
- European Investment Bank (EIB)—US$500 million
- Inter-American Development Bank (IDB)—US$400 million
- Corporación Andina de Fomento (CAF)—US$300 million
- International Finance Corporation (IFC)—US$300 million
These loans were "untied," meaning that companies from any country could be hired for the construction. The loans were for 20 years, with a 10-year grace period (meaning no payments for the first 10 years).
Impact on the Environment
The ACP's plan stated that the project would not cause lasting harm to the environment, local communities, forests, national parks, or important historical sites. It also said it wouldn't hurt farming, industries, tourism, or port areas. Any harm could be fixed using existing methods and technology.
The proposal also claimed that the project would not permanently lower water or air quality. The water supply plan was designed to use water from Gatun and Alhajuela Lakes very efficiently. This meant no new reservoirs would be needed, and no communities would have to move.
However, some critics worried about environmental issues. They were concerned about the link between El Niño (a weather pattern) and the threat to water supplies. The ACP did hire experts to study water supply and quality problems. Some critics, like Eric Jackson and Ariel Rodriguez, argued that the water-saving basins might allow more salt water into Gatun Lake. This is important because about half of Panama's population gets its drinking water from Gatun Lake. The ACP said they could reduce this problem by "flushing" the new locks with fresh water, but critics pointed out this would defeat the purpose of saving water.
On the other hand, one of Panama's main environmental groups, the National Association for Nature Conservation (ANCON), said that studies showed very low levels of salt in Gatun Lake. They believed these levels would protect the separation of the oceans and keep the water safe for people and wildlife.
Jobs Created by the Project
The ACP said the canal expansion would create many jobs, especially during construction. About 35,000–40,000 new jobs were created during the building of the third set of locks. This included 6,500–7,000 direct jobs during the busiest construction years. However, officials also said that the biggest impact on jobs would be in the medium and long term. This would come from the economic growth caused by the extra money from the expanded canal and the increased trade.
Most of the construction work was done by Panamanians. To make sure there were enough skilled workers, the ACP worked with public and private groups to train the necessary workforce. The costs for these training programs were included in the project's budget.
Some critics called this "demagogy" (meaning trying to win support by appealing to emotions rather than facts). They pointed out that the ACP's own studies showed fewer than 6,000 jobs created at the peak of construction. They also said some of these jobs would need highly skilled foreign workers because there weren't enough qualified Panamanians.
Panama's construction workers' union, SUNTRACS, was among those who opposed the expansion. Workers went on strike asking for higher pay and better safety. The union's leader, Genaro Lopez, argued that while some construction jobs would be created, the debt Panama took on for the project would mean less money for other government services like roads, schools, and police.
Critics also claimed that the project didn't have a plan for social development. President Torrijos later agreed to work with the United Nations Development Programme to create one.
Who Supported the Project?
Many groups and people supported the canal expansion project:
- ANCON (the National Association for Nature Conservation) approved the environmental studies.
- The La Prensa newspaper supported it in an editorial.
- The Chamber of Commerce, Industries and Agriculture.
- The CONATO (National Council of Organized Workers).
- Stanley Heckadon, a former director of an environmental agency.
- Famous Panamanians like former Miss Universe Justine Pasek, writer Rosa María Britton, and painter Olga Sinclair.
- Many canal customers and people in the shipping and business communities.
- 77% of Panamanian voters, in a special election.
Who Opposed the Project?
Some people and groups believed the expansion was not needed:
- Former President Jorge Illueca and others argued that building a huge port on the Pacific side would be enough. This port could handle large ships, and cargo could then be moved across Panama by train to other ships.
- The Council on Hemispheric Affairs (COHA) worried that the expansion might not help most Panamanians. They thought the benefits would mostly go to businesses and lawyers, and they questioned Panama's ability to manage such a big project due to corruption concerns.
- Former President Guillermo Endara and his political party, MOLIRENA.
- Most of the political left and labor unions in Panama, including CONUSI and FRENADESO.
- Most members of the nationalist Panameñista Party.
- Some religious groups who worried that poor farmers might be negatively affected.
See also
- Bayonne Bridge, an American bridge raised to accommodate post-Panamax ships
- Nicaragua Canal
- Tehuantepec Route
- Megaproject
- Panama Canal Railway
