Panama Canal Expansion Program: OverviewA modernwonderJorge Quijano, executive vice presidentof engineering with the Panam...
Panama Canal Expansion Program: OverviewO                wing to a unique strategic                location that dissects ...
Panama Canal Expansion Program: Overview   As the canal movestowards celebrating the             Compulab                 ...
Panama Canal Expansion Program: Overview                                                                                  ...
Panama Canal Expansion Program: Overviewcredit      organizations,including the European            GeoSolutions Consultin...
Panama Canal Expansion Program: Overview                                                                                  ...
Panama Canal Expansion Program: Overview                                              undertaken by the Mexican-Panamanian...
Panama Canal Expansion Program: Overview                                                               budget. However, th...
Panama Canal Expansion Program: OverviewONE SUPPLIER | SINGLE SERVICE | ONE ALLIEDRegional experts on integrating hardware...
Panama Canal Expansion Program: Overviewto be the designer of record for the locks.           perform the Gatun Lake area ...
Panama Canal Expansion Program: Overview                                      occur by testing out all risks, impacts and ...
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Panama am-bro-s Researched Abi Abagun

  1. 1. Panama
  2. 2. Panama Canal Expansion Program: OverviewA modernwonderJorge Quijano, executive vice presidentof engineering with the Panama CanalAuthority (ACP), talks to Jayne Alvercaabout taking Central America’s mosthigh profile infrastructure program fromconcept to completion
  3. 3. Panama Canal Expansion Program: OverviewO wing to a unique strategic location that dissects the American continent to connect the Atlantic and Pacific Oceans, the PanamaCanal has had a transformative effect onworld maritime commerce. Many of thepatterns of international trade that shapethe contemporary global economy owe theirexistence to this very special waterway.From a national perspective, the canalis even more important. It contributesaround 20 percent of Panama’s GDP and isintrinsically linked to Panamanian nationalidentity and pride as well as the country’saspirations for economic growth. The canal’s origins are rooted in a distantcolonial past. The French first attempted tolink the two oceans at the turn of the 20thcentury but were defeated by the malaria andyellow fever, the heavy rainfalls typical ofthe tropical rainforest, and financial woes. Itwas left to the US to complete constructionof the first two-lane canal and the initialset of locks which became operational in1914. On the eve of the Second World War,the Americans attempted to build a secondset of locks which would allow the transitof larger commercial vessels and war ships.The work was started in 1939 but abortedas a consequence of World War II and thecanal has since had no quantum upgrades. Since 1999, when the US finally cededcontrol of the canal to the Republic ofPanama, the Panama Canal Authority (ACP),which operates as an autonomous agency ofthe Government of Panama, has had the taskof managing this vital commercial waterway. Ongoing construction of the water saving basins’ conduits in the chamber floor of the new Atlantic Lock
  4. 4. Panama Canal Expansion Program: Overview As the canal movestowards celebrating the Compulab Compulab is a Panamanian corporation with over 18 years’100th anniversary of its experience in the technology industry and is associatedinauguration, ACP marches with large global technology companies such as Dell,on its spectacular program Microsoft and many others, making us one of the leaders inof works which will double business technology solutions in the country.the canal’s capacity and Our extensive hardware and software solutions give ourenable it to accommodate customer installed base a high level of trust since wethe new generation of provide the best customer service in the marketplace.super container vessels. Due to market acceptance, we continue to invest in training our human resources that guarantees a continuous level ofBy allowing larger vessels customer satisfaction.and increasing capacity, expansion programwill open the canal to newroutes and previously untapped markets.During the next 20 years, it is estimatedthat cargo volumes moving through thecanal will grow an average of three percentper annum, almost doubling the tonnage of2005 by 2025. If maritime trade continuesto accelerate after the recession, that figurecould increase significantly. The program of works currently beingundertaken is Central America´s most visibleexpansion program and the largest projectin the canal’s history to date. Seventy yearsafter the last major improvement projectwas first undertaken and then aborted, athird set of locks is soon to be added as partof a $5.25 billion expansion program. Butthis time it is home-grown Panamanianengineering and management talent whichis in the spotlight. The existing two sets of locks, whichraise ships 85 feet above sea level, haveso far defined the “Panamax” standard,which limits the size of container vessels Excavation of access channel that connects theto a maximum of 5,000 TEU (twenty-foot new Pacific Lock to the Culebra Cut
  5. 5. Panama Canal Expansion Program: Overview equivalent units). From 2014, Mayer BrownWorld-class. Worldwide. deeper and wider access Mayer Brown’s award-winning Projects and Infrastructure channels will complement Group is regularly involved in some of the world’s new locks to the southwest largest and most innovative projects and infrastructure of the existing Miraflores transactions. Our experience and resources have frequently Locks on the Pacific side proven key to getting the deal done. We are honored to and east of Gatun Locks on have been selected by the Panama Canal Authority and to the Atlantic side. This will have worked on this very special project.We are proud to be working with the Autoridad del Canal de enable the canal to moveá on the Canal Expansion Project. With our global reach into the “post-Panamax”and deep experience base in infrastructure, project development phase of its evolution and accommodate theand related financing transactions, Mayer Brown is a recognized transit of 13,000+ TEU ships.leader in complex infrastructure projects worldwide. National decision Americas | Asia | Europe | The decision to expand the canal was judged to be of such critical importance to Panama’s future that it was the subject of a national referendum in 2006 when all citizens were invited to make their views known. At the time, President Martín Torrijos Espino said it was the most important decision his generation had to take. Public approval was readily evident Geosynthetic Specialists since 1988 when over 76 percent of voters declared Our mission is to provide technology for the building industry to achieve profits they were in favor of the expansion. without destroying the environment. A year later, Torrijos Espino announced SERVICES: design, consulting, installation the Cabinet Council’s authorization for the and QCA for the installation of all types of geosynthetics. Panama Canal Authority (ACP) to negotiate Basalt excavation of the access channel PRODUCTS: Geotextiles, Geogrids, Geomembranes, the financial support package required. Since that will connect the new Pacific Lock to Geocells, Drainage composites, ECRM’s, then a group of multilateral and bilateral Gatun lake at Culebra Cut Gavions and Green Roof products. We have gained the respect of clients and contractors for our high level of quality “The program of works currently being undertaken is Central America´s most Contact us: / (507) 226 5900 visible expansion program and the largest project in the canal’s history to date”
  6. 6. Panama Canal Expansion Program: Overviewcredit organizations,including the European GeoSolutions Consulting, Inc. GeoSolutions is a leading provider of GeographicInvestment Bank, the Japan Information System (GIS) products and services. TheBank for International company’s highly trained team of image analysis expertsCooperation, the Inter- uses cutting-edge hardware, software, and the latest imageAmerican Development capture and investigation methodologies to record andBa n k, Inter nat iona l interpret high-resolution satellite and aerial imagery forFinancial Corporation and scientific and commercial applications. Geosolutions alsothe Andean Development provides robust file management products and servicesCorporation have pledged a needed to facilitate the distribution and storage of these large-scale files and high volume of data. The Panamatotal of $2,300 million. Canal Authority is just one of many GeoSolutions clients Jorge Quijano is executive on the region that has relied on the company expertisevice president of engineering to implement solutions to monitor, record and interpretwith responsibility for the the widespread and complex changes that occur in theirexpansion program and is geographic areas of interest.tasked with transforming info@geosolutionsconsulting.comthis vision into reality.He was formally assigned to the role in2007 after taking a lead on the program ayear earlier following the positive vote inthe referendum. “This is the most visible program inthe region. It may not be the largest whenyou consider what is being spent on theinfrastructure improvements that aretaking place in countries like Brazil, but thePanama Canal Expansion Program will havean extremely far-reaching internationalimpact through the creation of new routesand the opening of new markets,” he says.Key contractsOn 15 July, 2009, it was announced thatGrupo Unidos por el Canal SA (GUPCSA)had been granted the job of designing andbuilding the two new sets of locks that Construction and excavation of the new Atlanticwill join the Panama Canal to the Atlantic Lock. In the background is Lake Gatun with shipsOcean at one end and the Pacific Ocean awaiting transit through the existing Gatun locks
  7. 7. Panama Canal Expansion Program: Overview at the other. GUPCSA is a consortium comprising INSPECTORATE PANAMA, S.A. A Bureau Veritas Group company, with over 100 years Sac y r Va l leher moso experience in the inspection industry and laboratory SA of Spain, Impregilo services (petroleum, environmental, water, soils, Whatever commodity you trade in, risk management SpA of Italy, dredging sediments and food). We provide you a reliable service is no doubt high on your list of priorities. It is vital to SECTORS: know the exact quantity and quality of the goods you specialist Jan De Nul NV with confidence while delivering all the information you are dealing with.This is where Inspectorate can help. Oil & Petrochemicals of the Netherlands, and the need to run your operation safely, efficiently and As one of the world’s leading inspection and testing Panamanian construction profitably. Our Panama locations are certified ISO 17025 companies we can help safeguard your interests and Metals & Minerals company, CUSA. and ISO 17020. minimise associated risk. Food Safety There was fierce Providing peace of mind, not only for you, but for & Agriculture financial institutions, traders, mines, producers, competition for this project, government agencies, consumers, industry, advisors… Environmental whoever else may be relying on you to get it right. worth $3.2 billion. Four international Consumer Products consortia were prequalified and in the end INSPECTORATE PANAMA, S.A. Phone: +507 314 1665 | Mobile: +507 6671 5433 three bid for the project. ACP evaluated Email: the proposals and judged that GUPC Balboa, Panama, Panama presented the best value proposition and had the resources to execute the locks project and bring it to completion by the scheduled date in late October 2014, in the year of the centenary of the canal’s opening. Meanwhile, Dredging International was awarded the contract for deepening and widening the Pacific entrance channel andMexico, Central America, Panama and Colombia Jan de Nul would undertake dredging of the“Contributing to the Panama Canal expansion” Atlantic entrance channel.Complete retrofits and repowering of Panama The expansion program also involvesCanal marine equipment: building a new channel - the Pacific AccessPilot & crew boats, landing craft, drill boats. Channel - that bypasses Miraflores Lake Excavation has been split into four contracts• Marine Engines, Gears, MCD Clutches in parallel to the existing• Electronic Controls & Propulsion Systems channel and locks. This TESA• Heavy equipment for Construction, Mining & Agriculture - Sales & Rental new channel measures 6.1 TESA has 48 years of experience in market segments including• Generators - 5kw to 2000 kw kilometers and has been marine, construction, industry and automotive, representing 18 awarded via four distinct world renowned companies and offering engineering solutionsAutomotive Division: • Trucks, Vans, Pick-ups in Mexico, Central America, Panama & Colombia.• Passenger Vehicles, Motorcycles contracts. CUSA, a local TESA has inventories in bond in Miami, Mexico and Panama contractor, won the initial to provide support to our customers. We have the expertise to excavation contract in carry out retrofits and repowering of vessels and equipment. 2007. Then a second dry Visit our web site: excavation contract was
  8. 8. Panama Canal Expansion Program: Overview undertaken by the Mexican-Panamanian consortium Cilsa Panama-Minera Maria. A third contract was awarded in 2008 to Constructora Meco SA, for a total of $36.6 million. All of these works have now been completed. The last dry excavation project, which is ongoing, is the most expensive and challenging and has been awarded to the Mexican, Spanish and Costa Rican joint venture ICA-FCC-MECO. This project, known as PAC 4, is worth a total of $267,798,795 and is the second largest and most complex project after the new locks. It covers a key portion of the expansion’s new access channel linking the new Pacific locks with Culebra Cut, the narrowest stretch of New Pacific Lock construction looking north. In the background is Miraflores the Panama Canal. lake and the hills that conform the continental divide These are the main contracted projects, Quijano explains, although at the mouth some components that were completed well a portion of a road. It has been a similar of the Pacific Access Channel, there is also under budget. success story with all three of the first dry another small but significant dredging “Working closely with the contractors excavation projects which have all come in project that Jan de Nul is undertaking has also given us many opportunities for under budget.” which should be completed by mid-year. a shared approach to value engineering. These savings are then transferred into His rationale for splitting the excavation For example, the completion of the a global contingency fund which can be of the 6.1 km channel into four contracts first phase of the excavation work was used on project components that need is clear. “By designing these projects in achieved with a saving of $700,000 for additional resourcing. Nature and geology discrete elements, it meant we could do ACP and the contractor improved its are a potent mix and no outcome is totally the entire excavation program in eight profit margin more than they anticipated predictable, but so far most projects years. We would not have been able to by providing the ACP with a redesign of have been completed on time and within do a full design for the entire length of the channel for another two years which would have meant two years of lost time. Another consideration was that we wanted “By designing these projects in discreteConstruction of cement bentonite slurry to start with smaller projects to give local and regional contractors an opportunity to elements, it meant we could do the entirewall between the northern end of the accesschannel to the new Pacific Lock and theexiting Pedro Miguel Locks participate. They were able to come up with very good bid prices and as a result we have excavation program in eight years”
  9. 9. Panama Canal Expansion Program: Overview budget. However, the most critical and expensive Cemento Panama Cemento Panama is the leading company in the phases of the project production of cement, concrete and aggregates in are those which are now Panama. With more than 60 years in the country, we underway and he envisages are central to the development of one of the thriving that more resources may economies of the region, participating in emblematic be required, especially in projects such as the Panama Canal Expansion. completing the channel Cemento Panama is a Cementos Argos enterprise, the that connects the new fifth largest producer in Latin America, and fourth in Pacific locks to the Culebra the United States. cut and bringing the locks project to completion on time. “We started with a large contingency fund containing over $1.5 billion dollars to account for inflation and all sorts of possible unknowns in the field. As projects were designed, bidded and awarded at or under budget the remaining contingencies have been consolidated to complement the final components of the expansion if we see that they are needed,” he adds. Risk mitigation PANAMANIAN COMPANY COMMITTED Quijano is keen to point out that all of the TO AN ENVIRONMENTAL INTEGRATION. work, with the exception of the locks, has Hydroseeding, erosion control, revegetation, been designed in-house by ACP engineers Removing excavated material and complemented with consultants for is an ongoing process sediment control, dust control, gabions, geosynthetics. the dams. Design also entails full responsibility Grasstech for extensive preliminary A 100 percent Panamanian environmental company, geological investigations. dedicated to the marketing and installation of products “Most litigation claims used to supplement the development of civil works such normally arise from as hydroseeding, erosion control, revegetation, dustLA PITA Gupc Atlantico PAC 3 PAC4 problems and errors related control, sediment control, slope stabilization, drainage, sub drainage, canalization, containment, waterproofing, to few and inadequate coastal defenses, river defenses, geosynthetics, TELEPHONE: (507) 221.0544 geological information, among others. so we did a great deal of legwork before we put
  10. 10. Panama Canal Expansion Program: OverviewONE SUPPLIER | SINGLE SERVICE | ONE ALLIEDRegional experts on integrating hardware, software and services to secure critical business processes. Address:  Torre Banco General Marbella, Calle Aquilino de la Guardia, Floor 12 and 14 Phone: (507) 294-7557 e-mail: Follow us on: Construction continues day and night at the new Atlantic Lock site these projects out to tender,” he explains. an additional reservoir. found and we tell them Understanding the nature of risk and This further mitigated exactly where such cores transferring its ownership has been a critical issue. Even on projects of this scale, the risk and limited the contingencies we had to 20 million: were taken from. We have cores which have been taken there is sometimes only a small window of consider,” he says. Cubic meters of dredging along the entire length of opportunity to make preparations. But he “Each contract presents at Gatun Lake the proposed work. In this makes it clear that this has not been the case a different risk profile,” way we can transfer most of with the Panama Canal Expansion Program. he continues. “On the dry the risk, but this approach “To get it right in project management, you excavation side for example, we have been also limits the risk taken on by those who have to take the time to prepare properly. contracting work out for more than twenty want to work with us.” inspired I believe that every dollar invested at the planning and preparatory stage is worth years and each time it has been on the For the core locks project though, which basis of presenting contractors with tenders has a value of $3.2 billion, a different three to five dollars later on. We have been that required excavations of unclassified approach was taken. “This element we Your weekly digest of studying ways to expand the Canal since material. We know the geology of the area decided not to tackle ourselves. It was business news and views 1997 and looking at alternatives and options. very well by now and in our tenders we decided that it would be delivered through Then in 2002 and 2003, we invited other make available all of the information to the a design-build contract. As such the whole consultants to particularly contribute on the interested bidders. All bidding contractors design risk has been effectively transferred locks project to find a way to avoid building are shown the registers of what we have to MWH who the consortium has chosen
  11. 11. Panama Canal Expansion Program: Overviewto be the designer of record for the locks. perform the Gatun Lake area dredgingThese locks are being built entirely where 20 million cubic meters of dredgingaccording to their designand specifications, is being directly undertaken by ACP. Gatunalthough of course we have reviewed the Lake has an area of 164 square miles(425process closely.” km2) when its surface is at a normal Quijano is responsible for an internal elevation of 85 feet (25.9 m) above seateam which numbers over 500 people, of level, which made it the largest artificiallywhich 200 are responsible for engineering formed lake in the world in and 300 manage the projects in In addition to the dredging project thatthe field for the ACP. Another 800+ of will allow additional draft for the vessels thatoperations personnel are assigned to will transit the new locks there is another “We have cores which have been taken along the entire length of the proposed work” Leveling concrete base being placed so that forms and rebar can be installed effectively over it, and structural marine concrete can later be poured project that will increase Gatun Lake’s Nonetheless the northern sections of the maximum operating level by 45 centimeters, lake’s channels are wider, with fewer safety from its current 26.7 meters to 27.1 meters and operational implications, so these have and will provide additional storage capacity been contracted out,” he explains. for more than 200 million cubic meters of water in the lake. This project also adds to Managing complexity the draft reliability of the lake. At the outset, Quijano adopted the Project The lake is a particularly sensitive area Management Institute’s operational because this is where traffic is most restricted framework across every element of the and it has been a priority that the canal proposed program of work. “It represents a should continue to operate as efficiently very structured way of managing projects by as ever while works are in progress. “We establishing a clear resource loaded baseline decided that because transiting vessels in to follow at the outset, but also allows us to the lake move regularly past the equipment, look at ways of leveraging value variations. the dredging work would be best left to All changes are very strictly controlled our internal team which has 100 years of and we address possible change ordersDrilling of Gatun Formation to install rock anchors navigational dredging expertise in the area. very carefully long before they actually
  12. 12. Panama Canal Expansion Program: Overview occur by testing out all risks, impacts and now a combined effort which has created possible scenarios. This approach enables a seamless working environment. “We did us to take into account all possible issues not want a turnkey approach to this project and contingencies before we make critical because we have many highly skilled and decisions, such as whether we should capable engineers within ACP. It was more contract out a certain component, or obtain a question of filling in the knowledge and coverage for fuel price escalations.” experience gaps and now, after four years of He also attaches much importance to working with CH2MHill, we are all perfectly having the right organizational structure aligned with objectives that are understood in place. “It is not just about having talented and shared across the program. I feel we people. In some areas management ability have succeeded in mixing the best of local may be more important talent with the expertise than technical skills and of some of the finest we have to get the right international consultants balance every time. Here we took a very novel approach 13,000 TEU: to achieve an extraordinary feat of engineering,” he to maximizing our own Post-Panamax capacity comments. internal engineering talent when project complete For Quijano and his and local knowledge with team there is no greater the best international buzz than stepping outside consultants in project management to and seeing the results of geology twinned boost our knowhow in some specific with the best technology when the new areas,” he says. channels operate exactly as they should. In 2007, ACP contracted CH2MHill, Everyone involved in the program, he known for their project management of the adds, feels they are working towards a London Olympics, to support the expansion historic moment when the new locks program for the rest of its duration. “Most will open to oceangoing vessels less of their effort is concentrated on the locks, than 3 years from now. GUPCSA was which is the most complex aspect of the given 1,883 days to fulfill its contract expansion, but at a program management and the clock is ticking. By the end of level many other projects feed into this 2013, only the final completion and overall objective and we looked for external placing of the locks in service should support to get the integration we felt we be outstanding. needed,” he explains. He goes on to point out that this mixed For more information about integrated management approach led Panama Canal Expansion Program visit:Shaping the north channel entrance to some idiosyncrasies at the outset, but banks to the new Atlantic locks with adjustment on both sides, there is
  13. 13. Panama