The Panama Canal Authority has officially launched a negotiation process expected to last for one year to select operators for the construction of new terminals at both ends of the canal.  

Panama Canal officials announced plans to build a new terminal at each end of the canal to address the bottleneck of port throughput capacity and consolidate Panama's position as a global multimodal transport hub. The total investment of the project is expected to reach $2.6 billion, with an estimated annual increase of 5 million TEUs in transit capacity. The selection process for the terminal construction partner is expected to be completed by the end of 2026.   

The Panama Canal Authority has taken a crucial step forward. It is reported that the Authority has invited representatives of key global shipping companies to hold the first round of closed door meetings, marking the official entry of this major infrastructure project into the substantive promotion stage.  

The Panama Canal Company reported that 22 of the world's top terminal operators and major shipping companies participated in the latest promotion conference on new terminal planning. This includes APM Terminals under Maersk Line, Cosco Shipping Ports, CMA Terminals under CMA, DP World, Hanseatic Global Terminals, Japan's Mitsui Mercantile Shipping (MOL), Singapore International Ports (PSA), SSA Marine Grupo Carrix, and Terminal Investment Limited under MSC.  

At the same time, representatives from major global container shipping companies such as Maersk, Hapag Lloyd, CMA CGM, Yang Ming, HMM, ONE, and Zim also attended, demonstrating the industry's high level of attention to the project. Houston Port also sent representatives to attend this promotion event.  

Panama is expected to complete the selection process in the fourth quarter of 2026. This program will include pre qualification of bidders. They will also conduct market and feasibility studies on the two proposed docks separately. These studies will provide a basis for overall project planning and the final selection of franchisees. They estimated the total cost of these two terminals to be 2.6 billion US dollars.  

Panama currently has five ports with an annual throughput of over 9 million TEUs. However, people's attention is mainly focused on the two docks operated by Changjiang Heji Industrial Co., Ltd., which obtained a 25 year franchise extension in 2021.  

In addition to the political focus on Chinese operated ports, the Attorney General of Panama has also filed a legal lawsuit with the Supreme Court of Panama. They claimed that the franchise was illegal as it was granted through an undisclosed bidding process. Hutchison Whampoa defended its franchise rights, stating that it is fulfilling all obligations and investing in operations.  

Officials from the Panama Canal Company have stated that they are preparing for the possibility of the franchise expiring. If the franchise rights expire, they will intervene as temporary operators to maintain the normal operation of the supply chain. In this case, they anticipate that the new bidding process will take 12 to 18 months to award a new contract. However, they also retained the possibility of reaching an agreement with Changjiang Heji Industrial Co., Ltd. Earlier this year, Changjiang Heji Industrial Co., Ltd. proposed to sell its franchise rights to a joint venture led by BlackRock Group and invested by Terminal Investment Co., Ltd., a subsidiary of Mediterranean Shipping. Currently, negotiations are underway among all parties regarding the addition of COSCO Group to a new joint venture in the terminal asset portfolio, in order to salvage the transaction.Editor/Bian Wenjun