The huge project will cost over one billion dollars and is intended to ensure that the canal can also be operated during periods of drought.
The Panama Canal Board of Directors has approved funding for the construction of the lake. It is to be created in the middle course of the Indio River. The measure is in response to the severe drought in 2023 and 2024, during which the water level in the canal dropped so drastically that the authority was only able to allow a few ships with a significantly reduced draught to pass through the canal. This in turn led to long waiting times for maritime trade.
Work on the $1.2 billion project, which also includes a huge dam, is due to begin in 2027 and take four years to complete. The project includes the construction of a reservoir with a capacity of 1.5 billion m3 of water, as well as an 8.7 km long transfer tunnel that will lead from there to the Panama Canal catchment area. The reservoir is intended to secure the freshwater supply capacity of the two artificial lakes that feed the waterway – Gatún and Alujuela. After the drought subsided in September 2024, operations resumed in the fourth quarter. However, capacity has not yet fully recovered – according to an analysis by Bimco, shipping capacity in recent months was still around 10% below the average for 2019 to 2022.
“Although there have been no transit restrictions during this period, the transits of bulk, LNG and to a lesser extent tankers have not recovered to their historical levels,” said Filipe Gouveia, shipping analysis manager at Bimco. He warned that transit fees, changes in trade patterns and geopolitical conflicts would contribute to some shipping companies avoiding the canal in the future. The Panama Canal has recently been in the media spotlight due to statements by US President Donald Trump that he wants to “take back” the waterway. – Hansa.news global
