Panama Canal Eyes End to Transit Curbs

Once the Rio Indio infrastructure project is completed, the Panama Canal will no longer need to impose transit restrictions, even during the dry season, the canal authority’s new administrator, Ilya Espino de Marotta, said on Monday.

Until then, however, further restrictions on the waterway, which handles 3% to 5% of global maritime trade, are likely if rainfall is insufficient over the next three months. The intensifying El Niño phenomenon is raising concerns about water shortages, which determine transit quotas at the beginning of the year.

Construction of the new Rio Indio reservoir will take five to six years and is intended to secure water supplies for more than half of Panama’s population, as well as for canal operations, for the next 50 years. The project is expected to ensure that the canal no longer has to reduce permitted ship drafts or restrict transit. A reduced draft means vessels must carry less cargo to pass through the canal safely.

Unlike the Suez Canal, the Panama Canal uses fresh water from two artificial reservoirs to operate the locks connecting the Pacific and Atlantic oceans. Past water shortages have led to auctions in which vessels paid more than $1m to secure transit slots.

Meanwhile, the canal authority announced several days ago that it was limiting the number of daily transits because of adverse weather conditions.

(Reuters, max)