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Panama Canal Wins Arbitration over $193 Million in Expansion Project Overruns

 The head of the Panama Canal Authority has said that on a Miami-based arbitration board rejected a demand by Spanish-led GUPC consortium for $192.8 million to cover cost overruns during the building of a third set of locks for the century-old waterway.

GUPC or Grupo Unidos por el Canal includes Sacyr SA of Spain, Impregilo of Italy, Jan De Nul of Belgium and Constructura Urbana of Panama.

The authority’s chief executive, Jorge Quijano, announced the ruling in a post on his Facebook page.

“We have been informed that we have won a major arbitration dealing with the expansion of the canal by the GUPC contractor for $192.8 million,” Quijano wrote in a post.

The $5.4 billion expansion of the Panama Canal was completed in June 2016.

The Panama Canal Expansion was the largest infrastructure project since the Canal’s opening in 1914. Considered and analyzed for a decade with more than 100 studies, the Expanded Canal provides the world’s shippers, retailers, manufacturers and consumers with greater shipping options, better maritime service, enhanced logistics and supply-chain reliability,

Since its inauguration on June 26, 2016, the Expanded Canal increases the waterway's capacity to meet the growing demand of maritime trade using larger vessels, which means that the Panama route provides important economies of scale.

The Expansion included the construction of a new set of locks on the Atlantic and Pacific sides of the waterway, creating a third lane of traffic and doubling the cargo capacity of the waterway. It also included the creation of the Pacific Access Channel, improvement to the navigational channels, and improvements to the water supply.

While the expanded locks are 70 feet wider and 18 feet deeper than those in the original Canal, they use less water due to water-savings basins that recycle 60 percent of the water used per transit. In line with its commitment to customer service, the Panama Canal will continue to provide the world with value for another century and beyond.


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