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Mar. 03, 2014

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38 THE JOURNAL OF COMMERCE www.joc.com MARCH 3.2014 TRANS-PACIFIC MARITIME SPECIAL REPORT WHILE THE CONSORTIUM building the Panama Canal's new locks resumed work after a two-week suspension last month while it continued negotiating a settlement with the Panama Canal Authority on cost overruns, the agree- ment leaves unanswered the questions of when the $5.25 billion expansion project will be completed and how much more it will cost in the end. Lingering technical problems with the lock gate technology and problems with the geology under the excavation zone for the new locks and the channel leading from the locks on the Pacifi c side of the canal to the Culebra Cut are unresolved and could cause further delays and infl ate the ultimate costs. These technical problems are likely to delay the project and boost costs, and may force the canal authority to raise tolls, according to Asaf Ashar, a port consultant and research professor with the National Ports & Waterways Initiative. The Panama Canal Authorit y's hopes for completing the expansion project on time and under budget were dashed on Feb. 5 when the consortium Grupo Unido por El Canal made good on a threat it issued in December to sus- pend work on the new locks, saying it was owed $1.6 billion for cost overruns. The Panama Canal's tentative settlement with its contractor leaves technical problems — and a completion date — unresolved By Peter T. Leach ONE ONE STEP AT A TIME TIME

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