ISLE OF PALMS — The recently retired head of the Panama Canal Authority said Tuesday that American exports ranging from Gulf of Mexico crude oil to Midwestern grain and natural gas from fracking shale will benefit from the expansion of the canal in three years.
Alberto Aleman Zubieta, who retired earlier this month as CEO of the autonomous agency that manages the canal, spoke to the South Carolina International Trade Conference.
Aleman said a $5 billion project to deepen and build larger locks on the canal is continuing around the clock. The work should be finished by late 2014 with the canal fully operational the following spring, he said.
“One of the main beneficiaries will be East Coast and Gulf Coast of the United States,” he said.
Ports in the region are already moving to deepen their harbors to accommodate the larger ships the canal will be able to handle and that will soon make up the majority of the world’s commercial shipping fleet.
Charleston is working on a $300 million harbor deepening project. Nearby Savannah is pursuing a $650 million effort to deepen the Savannah River shipping channel so the Georgia ports can handle the larger ships.
The existing locks on the canal are 110 feet wide and 1,000 feet long. In some cases, larger ships have only 2 feet of clearance on either side. The new locks will be 1,400 feet long and 180 feet wide.
“It’s all about the economy of scale,” Aleman said.
The canal will make U.S. grain exports more competitive and has the potential to increase U.S. coal shipments to Asia and China through Gulf and East Coast ports, he said.
In addition, he said, the expanded canal will make American crude oil more competitive on the world market as well as making natural gas derived from oil shale more competitive.
Currently, about 65 percent of the cargo moved through the canal is moving to or from the United States. Such cargo is expected to increase when the expansion is finished.
Jim Newsome, the president and CEO of the South Carolina State ports Authority, called the expansion “the most ambitious public works project in the history of the modern world.”
He said it was a “defining moment and a game-changer” for worldwide shipping.