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Panama Canal Authority to Dredge 1,350-meter Berths at Controversial Port of Corozal

Binding Offers for the Container Terminal Port Concession End on February 3. Panama Canal Authority (ACP) Should Spend $70 Million to Dredge the Proposed 1,350-meter Berths. Concessionaire to Assume Additional Dredging.

Panama Canal Authority (ACP) should spend $70 million US to dredge a large part of the proposed Port of Corozal, whose 20-year concession should be granted this year, when the winner for the public tender is announced.

During the pre-qualification stage, which ended on April 28, 2016, four operators qualified to make their proposals: APM Terminals BV, Terminal Link, PSA International and Terminal Investment Limited.

In October 2016, the tender ACP issued called for qualified operators to make their pro-posals, but the country’s canal authority didn’t give a specific timeline for awarding the port concession to the tendering winner. It said an announcement should be made following the evaluation of the binding offers, which will be completed by February 3.

Then, within forty days of the award notice, the winner should sign an agreement and pay ACP an upfront fee.

In the document, ACP said it expects the container terminal to play an “important role” in providing additional port capacity on the Pacific side of the country, while supporting Pan-ama’s transshipment needs for the larger vessels going through the new sets of the Panama Canal locks.

Subject to concern and the debate, the port concession raised diverging opinions among different entities, including the National Association of Lawyers of Panama (CNA) and the country’s Maritime Chamber (CMP).

CMP issued a statement showing its support for the project. According to CMP, the new port concession will “cover” the country’s in-creasing demand for port services.

“The development of Panama’s logistics and maritime industries greatly depends in the strength, growth and efficiency of its port offering, which will ultimately increase transshipment cargo volumes that [actually] move the Panamanian port system,” the statement said.

While other entities, such as CNA, disagree on the country’s need to improve port-related services in an already competitive industry, CMP said having increased port capacity was an “urgent need.”

“Increasing port capacity was a decision by [Panama’s] state, and Panama’s Maritime Chamber supports all projects that improve the services offering to vessels and cargos that can be developed immediately or in the future,” CMP said in its statement.

ACP didn’t respond to IDR questions on the project, especially on the dredging costs it should fund. 

In fact, after the qualified operator names were disclosed, much of the project’s process remained confidential. 

One of the major questioned points of the current tendering for the port concession is the fact that ACP will fund a large part of the required capital dredging along the proposed 1,350 meter (4,429-foot) berths.

ACP will dredge the port within its navigation channel, including its turning basin and east prism line, while the winning operator will be responsible for the blasting and dredging required for the construction of berth pockets alongside the quay walls of the terminal facilities of 70 meters (about 230 feet) width and a -18 meters (-59 feet) Mean Low Water Springs (MLWS) depth.

Talking to local media on why public money should fund a private project, ACP ex-plained it will dredge the navigation channels and its adjacent areas in order to “guarantee a stricter control over the transit operations.”

On the other hand, CNA opposed the project and said ACP didn’t attend a forum the association of lawyers organized to discuss the port concession.   

“We had more questions than actually answers,” CNA said in a statement, of the forum it launched the discuss the project.  

The National Association of Lawyers of Panama questioned not only ACP’s denial to launch a public consultation over the project, but also its “legal capacity” to lead the port concession. According to CNA, under Pan-ama’s General Port Law, Panama’s Maritime Authority (AMP) should be responsible for the tendering. Additionally, CNA questioned ACP’s willingness to grant fiscal exoneration to a private port owner in an “extremely de-veloped” industry.

PORT OF COROZAL: DREDGING AT A GLANCE

According to the tender, the project, under ACP, should maintain the depth at the access channel and the turning basin, so that eligible container vessels can safely berth and unberth at or from the Corozal Container Terminal. The project will also use blasting and dredging to achieve:

• a depth at the access channel to the Corozal Container Terminal of -16.3 meters (-53.5 feet) MLWS (with overdredging of 0.6 meters or 1.9 feet);

 • a depth at the turning basin for the Coro-zal Container Terminal of -16.3 meters (-53.5 feet) MLWS (with overdredging of 0.6 meters or 1.9 feet);

• a depth from the east prism line till 155 meters (about 509 feet) from the center of the navigational channel toward the shoreline, and along the length of the berths of the Ter-minal Facilities of -16.3 meters (-53.5 feet) MLWS (with overdredging of 0.6) meters or 1.9 feet);

a slope that will start at 155 meters (about 509 feet) from the center of the navigation channel to 200 meters (about 656 feet) from the center of the navigation channel. ACP shall be entitled to appoint contractors to undertake all or some of the blasting and dredging required by this clause.

The concessionaire will maintain each berth pocket completed by the concessionaire alongside the quay wall of the terminal facilities, provided that all maintenance dredging to be carried out by the concessionaire shall be subject to the prior coordination with ACP and the ACP will decide the disposal site for the dredged material.

According to the tender, dredging for the berthing pool and its vessel accesses, which is not included in work to be performed by others, must meet concession agreement requirements. The berth pool along the wharf shall be dredged to at least -18 meters (-59 feet) MLWS and 70 meters (about 230 feet) wide.

Source: ACP. RFP Tender No. CCO-16-003 issued on October 7, 2016. 

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