Panama Canal taking reservations for neopanamax ships
The Panama Canal Authority began taking reservations for larger ships that will be able to transit through the Panama Canal once the new, larger locks open for regular business June 27.
AMERICAN SHIPPING MAGAZINE
WEDNESDAY, APRIL 20, 2016
The Panama Canal Authority (ACP) has started taking reservations for the larger ships that will be able to transit through the Panama Canal once the new, larger locks open for regular business June 27.
The authority began offering four reservations slots per day for “neopanamax” cargo ships that can transit the canal only by using the larger locks.
On Monday, ACP authorized companies to book neopanamax ships for transit between June 27 and September 30. A total of 25 neopanamax ships made reservations the first day, with the first reservation granted to a liquefied petroleum gas (LPG) tanker Linden Pride of NYK Line, represented by shipping agent Norton Lilly International (Panama), ACP said. Gas tankers carrying both liquefied natural gas (LNG) and LPG are expected to be growing users of the canal.
“Of the neopanamax vessels that have been booked thus far, as of April 19, all are container vessels with the exception of Linden Pride,” Norton Lilly Vice President, Panama office Joe Walden said. “Norton Lilly have represented NYK at the Panama Canal for more than 65 years, and we are very proud that one of their vessels has secured the first booking slot for transit through the new neopanamax locks. This is truly a historic event.”
The ACP said ships are neopanamax if they have a length of more than 966 feet or a beam of more than 107 feet.
On June 26, the ACP is planning a ceremony that will coincide with the first commercial transit of the canal by a ship using the new locks. In order to choose which ship will be the first to go through the new locks, the authority has asked 15 of its largest customers to nominate a ship, and is expected to conduct a drawing on April 29 to choose the first ship.
Starting Friday, ACP will allow ships to book transits for the period between Oct. 1 and Dec. 31, 2016, while starting next Monday, the authority will allow companies to book ships up to one year in advance for passage through the new locks. In addition, the ACP will offer one reservation slot per day for neopanamax passenger ships starting in June of 2017.
Walden noted that the four slots are only for a portion of the total number of ships that are expected to use the locks on a daily basis.
He said the ACP has told it that while it’s very difficult to accurately determine the maximum capacity of the new locks as the exact lockage times for neopanamax vessels is not known, that it estimates approximately 12 vessels per day will use the locks, but that “this number will depend of course on a number of variables such as ship size, type, cargo, restriction, draft, and the learning curve of the pilots. Once the expanded canal is in operation, we will be able to provide a better estimate.”
Walden said it was his opinion that the neopanamax booking procedures – with only four booking slots available – may simply be the initial version, and that over time will be amended.
He noted the slots are being offered are for in the first booking period, up to 365 days prior to the transit date.
A Panama Canal document, Notice to Shipping: Panama Canal Transit Reservation System explains reservations are doled out in three reservation periods, with the first between 22 days and 365 days in advance, the second between four days and 21 days in advance and the third between two days and three days in advance.
“While the passenger ship and containership segments may be interested in securing these four slots so far in advance of the transit date, it will be near impossible for the tramp segments (dry bulk, tanker, LPG, LNG, for example) to book that far in advance,” said Walden. “I believe in time, the Canal Authority will need to satisfy these other shipping segments by making slots available in the 2nd and 3rd periods. Once the new locks have opened and are in use, the Canal Authority will need to reevaluate the situation once they have had an opportunity to see how the market responds in utilizing the new locks.”
He noted “The trend at the canal has been larger and larger vessels (now over 70 percent daylight restricted ships). We may very well, over time, see some of the panamax volume being replaced by neopanamax vessels. In which case, the Canal Authority could then start reallocating Panamax booking slots to the neopanamax vessels. In other words, taking some of the 17 slots currently available to Panamax vessels and allocating them to the neopanamax segment.”
Walden said his understanding that in addition to ships that are too wide or too long to pass through the old locks of the Panama Canal, the ACP may allow panamax ships loaded to a draft that exceeds the restrictions of the current panamax locks (deeper than 12.04 meters, tropical fresh water) to transit through the new neopanamax locks.
He said these ships, referred to by the ACP as “Panamax Plus,” would be permitted to transit using the new locks, “but would pay higher tolls overall in accordance with the new tariff. Also they would need to pay the cost of tugs and line handlers for use of the new locks, however these new costs are not yet known as the canal authority have not yet announced the new tariff for tugs and line handlers.”
“Also I understand that perhaps the canal authority could – “At Canal Convenience” – elect to pass a smaller vessel (i.e. smaller than neopanamax) through the new locks simply as a means to maximize efficiency and overall transit capacity. I have no idea if this would be a regular occurrence, I doubt it, but there is the potential. I was told that if the Canal Authority made the decision to pass a smaller vessel through the neopanamax at their convenience, then that vessel would only pay tolls associated with the current panamax size locks.”
In March the ACP said there were 1,037 oceangoing transits of the canal 801 booking slots were offered, including auction slots and 687 were used. It said the number of oceangoing transit ranged from 26 to 38 each day in March. There are also some cruise ships that do “turnaround” cruises where they pass through the locks and then turnaround in Lake Gatun and exit the canal from the same side they entered.
Walden said the ACP has given a proforma daily capacity estimate after the canal opens of 20 panamax ships, 12 neopanamax ships, plus eight to 10 smaller, non-restricted vessels or about 40-42 ships.