Tuesday , 27 September 2016
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Consultancy chief sceptical of June opening of Panama Canal
The project was initially scheduled to be completed by the end of 2014

Consultancy chief sceptical of June opening of Panama Canal

The president of shipping consultancy CK Americas has expressed doubts that the Panama Canal’s new locks will open in June 2016.

Michael Kaasner Kristiansen claimed in an article on Linkedin that the opening target date of June 30, 2016 is “looking a bit optimistic” even to the casual observer.

In February this year, the Panama Canal Authority (ACP) said that  the overall project, which was initially set to be be finished by the end of 2014, is more than 96% complete.

While pointing out that the new lock gates were indeed fixed, Kristiansen, who worked at Maersk for 24 years, said that the locks still have to undergo actual vessel testing, which is scheduled for April this year.

“Curiously, the time between the testing using an actual vessel – albeit an empty one – and commercial opening has now been squeezed to 2 months, down from previous 3 months,” he added.

According to Kristiansen, although experiencing delays in massive projects such as the Panama Canal expansion is not unusual, the “unresolved disputes” between Panama Canal Authority (ACP) and Grupo Unidos por el Canal (GUPC), the consortium responsible for the design and construction of the canal’s third set of locks, cannot have helped.

Kristiansen claimed in his article that delays date back to the beginning, when the grade of concrete was discussed. “It took no less than 6 months for this to be resolved, ending with the exact grade specified in the tender. ACP cannot be blamed for this but it gave an early indication that it was not going to be smooth sailing,” he added.

Despite stressing that ACP cannot be blamed for the delays, he argued that the communication surrounding them, or rather what he claimed is a “lack of clear communication”, left many sceptical of when the commercial opening date will actually be.

According to Kristiansen, while some are guessing the commercial opening will be in August or September 2016, others think 2017 is more realistic.

The owner and president of CK Americas continued in claiming that ACP must focus on the opening of the expanded canal rather than on the Corozal project, which involves the construction of a container port in Corozal West, at the entrance to the Panama Canal in the Pacific.

Kristiansen argued in his article: “ACP has not inspired confidence in that the commercial opening will indeed take place in June 2016 and this is where the focus of ACP should be. Instead, it seems more focus is dedicated to the Corozal project. This is a project that can and should wait.”

In Kristiansen’s opinion, large scale redeployment of 8,000 – 9,000 teu vessels or full neo-Panamax vessels to the canal will not happen before 2017.

“The shipping lines do not have the confidence to make firm re-deployment plans for 2016, taking advantage of the Panama Canal expansion. This is a lost opportunity to pull back 3-5 strings from the Suez Canal in 2016 but there should be focus on getting this done in 2017,” he added.