Safety fears cloud advantages of expanded canal, says PGI Intelligence
A PGI (Protection Group International) Intelligence's Insight report raises safety concerns about the expanded Panama Canal that risk accidents and delays for shippers and higher claims for insurers.
PGI Intelligence is a London-based research house that conducts corporate investigations and due diligence inquiries on international projects.
In addition, structural issues relating to the new locks could also threaten the long-term integrity of the project and risk new delays.
There have been growing concerns over safety issues associated with the introduction of neopanamax vessels along the waterway.
Industry bodies have warned that at 427 metres long and 55 metres wide, the new locks are too small for the neopanamaxes, says PGI Intelligence.
The largest vessels can measure up to 366 metres long and 49 metres wide, leaving a distance of just six metres across the width of the canal and 61 metres length-wise, much of which will be taken up by tugboats on either end of the vessel to guide it through the lock.
A joint study by the International Transport Workers' Federation (ITF) and Brazil's Fundacao Homem de Mar (FHM) found that under windy conditions the manoeuvrability of vessels would be compromised, making accidents likely due to the lock's narrow dimensions.
After cracks appeared in the Cocoli lock during the testing phase in August 2015, anonymous structural engineers cited in the New York Times said the cracks were likely a result of sub-standard pouring methods as a core sample of the lock showed air gaps in the concrete.
They claimed that this would require the lock to be demolished and rebuilt, a measure that would have bankrupted the expansion project. The ACP has denied this, blaming the cracks on insufficient reinforcement, resolved with more steel bars and additional concrete.
The prospect of an accident involving such large vessels and cargo loads presents significant financial risks for shippers and insurers.
An accident would also impose indirect costs as a result of delays to scheduled transits through the canal. With construction work on the canal now complete, the highest risk of strike action is from workers operating the canal.
In light of safety problems with the new locks, any accident resulting in employee casualties is likely to spark a strike.
The cost-savings associated with the introduction of neopanamax vessels could be compromised by draft restrictions imposed during droughts along the canal.
In 2015 and 2016, the ACP imposed increasingly stringent draft restrictions on vessels, decreasing the permitted distance from the waterline to the bottom of the hull and forcing many vessels to lighten their load to comply with the measures.
The success of the expansion of the Panama Canal is partly dependent on how the ACP manages and mitigates such risks through training and its response to the emergence of any safety and structural vulnerabilities.
However, the ACP has taken a cautious approach to the new locks, initially permitting four vessels per day during an initial trial period before increasing the canal's maximum capacity to 13-14 transits per day, although a timescale for the increase has not yet been established.
A PGI (Protection Group International) Intelligence's Insight report raises safety concerns about the expanded Panama Canal that risk accidents and delays for shippers and higher claims for insurers.
PGI Intelligence is a London-based research house that conducts corporate investigations and due diligence inquiries on international projects.
In addition, structural issues relating to the new locks could also threaten the long-term integrity of the project and risk new delays.
There have been growing concerns over safety issues associated with the introduction of neopanamax vessels along the waterway.
Industry bodies have warned that at 427 metres long and 55 metres wide, the new locks are too small for the neopanamaxes, says PGI Intelligence.
The largest vessels can measure up to 366 metres long and 49 metres wide, leaving a distance of just six metres across the width of the canal and 61 metres length-wise, much of which will be taken up by tugboats on either end of the vessel to guide it through the lock.
A joint study by the International Transport Workers' Federation (ITF) and Brazil's Fundacao Homem de Mar (FHM) found that under windy conditions the manoeuvrability of vessels would be compromised, making accidents likely due to the lock's narrow dimensions.
After cracks appeared in the Cocoli lock during the testing phase in August 2015, anonymous structural engineers cited in the New York Times said the cracks were likely a result of sub-standard pouring methods as a core sample of the lock showed air gaps in the concrete.
They claimed that this would require the lock to be demolished and rebuilt, a measure that would have bankrupted the expansion project. The ACP has denied this, blaming the cracks on insufficient reinforcement, resolved with more steel bars and additional concrete.
The prospect of an accident involving such large vessels and cargo loads presents significant financial risks for shippers and insurers.
An accident would also impose indirect costs as a result of delays to scheduled transits through the canal. With construction work on the canal now complete, the highest risk of strike action is from workers operating the canal.
In light of safety problems with the new locks, any accident resulting in employee casualties is likely to spark a strike.
The cost-savings associated with the introduction of neopanamax vessels could be compromised by draft restrictions imposed during droughts along the canal.
In 2015 and 2016, the ACP imposed increasingly stringent draft restrictions on vessels, decreasing the permitted distance from the waterline to the bottom of the hull and forcing many vessels to lighten their load to comply with the measures.
The success of the expansion of the Panama Canal is partly dependent on how the ACP manages and mitigates such risks through training and its response to the emergence of any safety and structural vulnerabilities.
However, the ACP has taken a cautious approach to the new locks, initially permitting four vessels per day during an initial trial period before increasing the canal's maximum capacity to 13-14 transits per day, although a timescale for the increase has not yet been established.