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HomeInformationThe marvel that is Panama Canal, how it works and why it...

The marvel that is Panama Canal, how it works and why it is important to global trade..

There is a tiny isthmus (narrow strip of land with sea on either side, forming a link between two larger areas of land) lying between the Pacific and Atlantic Oceans connecting North and South America called the Isthmus of Panama..

This isthmus is of strategic importance to global trade and the world of shipping because it contains the country of Panama and the Panama Canal..

Panama is home to the largest ship registry in the world, whereas the Panama Canal is of huge significance to the shipping industry..

Capt.Ricardo Caballero Vega – a veteran maritime pilot transiting ships across the Panama Canal for 25 years explains why..

Panama Canal - Capt.Ricardo Caballero Vega - Shipping and Freight Resource

History of the Panama Canal

Before the Panama Canal came into existence, ships sailing from Europe to the West Coast of North and South America had to sail on the Atlantic Ocean around Cape Horn in South America to reach the West Coast or ships trading between the East and West Coast of the Americas also had to go around the Cape Horn.

By using the Panama Canal, ships crossing from the Atlantic Ocean to the Pacific Ocean or vice versa save approximately 8,000 nautical miles (15,000 km) while ships trading between the East and West Coast of the Americas save approximately 3,500 nautical miles (6,500 km) and ships between Europe and Australasia and South East Asia save around 2,000 nautical miles (3,700 km).

This is quite a saving in today’s terms especially considering the global warming situation we have landed ourselves in and to prevent more carbon emissions. Carbon emissions, of course, was not the reason the Panama Canal came into existence.

The building of the canal wasn’t more a product of chance than of causality. This piece of engineering feat began to be conceived back in the early days of the XVI Century when the Spanish Conquistador, Vasco Nuñez de Balboa laid eyes, for the first time, on the waters of the Pacific Ocean after crossing the isthmus of Panama.

From Panama, the Spaniards organized expeditions to South America which resulted in the conquest of the Inca Empire and the subsequent appropriation of its vast amounts of gold. All the riches needed to be shipped back to Spain, and Panama was the shortest way.

By a decree issued in 1534, Carlos 1 King of Spain, ordered the regional governor of Panama to draw up the plans to build a route to the Pacific following the Chagres river, the most important source of water for the Panama Canal. The required technology wasn’t yet developed, but the interest in the route would stay alive throughout time.

As years passed by, new events would cause the idea of an interoceanic canal to shift up to the next level. American tycoons of the shipping industry, with U.S. Government support, found themselves at the core of a “golden” opportunity to increase their wealth: The Californian Gold Rush.

The discovery of gold in California by 1848, literally rushed Americans living on the East coast to venture to the West in search of the precious metal. The long, dangerous and nearly impossible journey across the North American continent would make the gold seekers look for an easier and faster alternative.

And, once again, the link to wealth was Panama. Instead of heading west, people headed south, crowding the boats (and shipping companies pockets) that sailed to the tiny isthmus. From there, again by sea, they would continue their journey to California.

However, crossing the isthmus wasn’t a ride through a park either. The unforgiving conditions of the Panamanian rainforest would take its death toll. By the thousands. And instead of a canal, what alleviated the painful passing through Panama for the greedy-adventurers was the construction of the first intercontinental railroad in 1855.

It wasn’t until 1880 that the first serious attempt to build a canal through Panama (then a province of Colombia) was made.

Having succeeded in Egypt in building the Suez canal, Frenchman Ferdinand De Lesseps was the best bet to undertake the tremendous assignment of cutting through the land to connect the two oceans.

The French middle class felt it was an opportunity for easy gains and became the majority stockholder of La Societe International du Canal Interoceanique, the company that would administer the construction.

After nine years of struggling with the harsh topography of the terrain, poor planning, and the idea that a sea-level canal was viable, De Lessep’s enterprise failed. Not to mention, the thousands of workers who died of malaria and yellow fever.

But the French’s failure turned out to be a learning experience for the Americans who, after supporting Panama’s independence from Colombia, were awarded the rights to build a canal.

The Americans opted for a different option: a locks canal. This would be accomplished by damming the Chagres River to create Gatun Lake, which would prevent them from performing unnecessary digging.

More importantly, the Americans identified the causes of the diseases that decimated thousands of lives during the French project. A safer, healthier working environment, was thus the key to their success.

The Panama Canal began to take shape, at the same time that the new Republic of Panama was born. However, the Panamanian people would experience their brand new nation as one whose land had been split in half by the United States and a canal.

This became the cause of nationalistic struggle which continued for decades and ended with the return of the canal, and the land it was built on, to Panama in the year 2000, under the Torrijos-Carter treaty.

The first Panama Canal pilot was Captain John Constantine who piloted the SS Ancon, an American cargo and passenger ship that became the first ship to officially transit the Panama Canal in 1914.

SS Ancon - first ship to transit Panama Canal
SS Ancon – the first ship to transit Panama Canal – Source: Panama Canal Authority

While the construction of the Panama Canal changed the world’s trade patterns, it also created new ones. Right from the beginning of the 20th century, it became the mandatory route for ports that had never been connected before.

By significantly shortening the distances between points of production and consumption at the time, the waterway propelled the growth of everyone related to the business of commerce and transportation. It also pushed the creation of new, and larger port facilities, mainly on the coasts of North, South America, Europe, and during the recent past, China.


So how does the canal work?

The Panama canal works as a “water bridge” in which ships are elevated at about 85 feet (26 metres) above sea level by a system of locks.

Ships transiting from the Atlantic to the Pacific enter the approach channel in Limón Bay, which extends a distance of about 11 km to the Gatún Locks.

Gatún Locks on the Atlantic side is a set of three consecutive steps that lift the ships up 85 feet (26 metres) to Gatún Lake.

Ships then proceed on the Gatun Lake to Gamboa where the Culebra Cut begins. Culebra Cut was where most of the digging took place. It “cuts” through the continental divide and it stretches for 7 miles (11.2 km) with sharp twists and turns. Big vessels are forbidden to meet in this area.

Here, the Pedro Miguel Locks which is a single step lowers the vessels 30 feet (9 metres) to Miraflores Lake, which is at an elevation of 52 feet (16 metres) above sea level.

The ships then pass through a channel almost 2 km long to the Miraflores Locks which consists of two consecutive steps, where they are lowered back to sea level on the Pacific Ocean side. The ships then pass through a final 7 mile (11.2 km) passage after which the ships enter the Pacific Ocean.

how panama canal works
Source: Panama Canal Authority
How Panama Canal works
Source: Panama Canal Authority

Each lock chamber is 1000 feet (304 metres) long by 110 feet (33.5 metres) wide. The maximum beam (width) that a ship can have in order to be allowed passage through these locks is 106 feet (32.3 metres) and ships which had this width are known as Panamax.

The canal may allow the transit of vessels with larger beams like 108 feet (32.9 metres) warships or specialized vessels, provided they do it only one time. The maximum allowable draft is 39.5 feet (12 metres), if Gatún Lake is at its optimal level, otherwise, restrictions in draft may apply.

Each set of locks consists of two lanes. The lanes are not for locking ships in opposite direction at the same time as people might think (which occurs invariably as a coincidence) but rather they were built that way so one could be completely closed for maintenance work while the other remains available for shipping. This way the canal does not have to cease servicing the industry.

Ships move through these locks with the assistance of powerful locomotives (known also as mules as an analogy with those strong and stoic beasts) while using their own engines. Tugboats are also used in assisting ships, depending on their size, to arrive and enter the locks.

Even after a century of constant use and having transited more than a million ships safely, the great steel gates of the Miraflores locks still swing open with the precision comparable to that of a Swiss watch. Each of these 672-ton locks is operated with the help of a pair of 25-horsepower motors.

The Gatún locks designed in the days of Theodore Roosevelt and cast with Pittsburgh steel, the locks were designed to handle with ease ships the size of the Titanic which was the standard a 100 years ago.

These dimensions were, of course, applicable to the “old” or “Panamax” locks.


The Panama Canal expansion and the New Locks

To accommodate the evolution of “neo Panamax” ships, the Panama Canal Authority on June 26, 2016, the Panama Canal Authority doubled the capacity of the waterway by adding a third lane of locks.

These new set of locks, capable of handling vessels with a length of 1205 feet (367.2 metres) by 168 feet (51.2 metres) in beam, and a maximum draft of 50 feet (15.2 metres), is the most notorious part of the upgraded waterway which also underwent the widening and deepening of its channels.

Unlike the old Panamax locks, these new ones (called Neo Panamax locks) were designed with recycling pools in order to minimize water consumption. Instead of locomotives, ships are assisted by tugboats tied up at each end.

Apart from their huge difference in size the new locks, Agua Clara on the Atlantic and Cocoli on the Pacific side were each built as three steps locks. There is no intermediate lake like in the case of Miraflores and Pedro Miguel. Ships are raised to Gatun lake level, or lower to sea level, once they pass through these new locks.

All the water used for locking ships up or down goes out to sea by gravity. This is why rainfall is very important to keep the canal operational. An average of 52 millions gallons of water is necessary for every ship that uses the old locks. In the case of the Neo Panamax locks, the recycling pools contribute to saving about 33 million gallons of water, while letting 22 million gallons drain out to sea.

Each vessel that transits is under the control of a Panama Canal Pilot. In fact, the Panama Canal is the only waterway in the world in which the ship’s Captains relinquish control to pilots. The complexity of the operation makes it a necessity. Depending on the size, vessels are assigned one or more pilots.

This pic is aboard the container vessel MSC SILVIA, inside the new locks ( Agua Clara).

The MSC SILVIA is transiting southbound. It will stop in Balboa before proceeding to Manzanillo and probably some ports on the U.S. West Coast. If these new locks had not been built, ships this size would have to use Suez or just trade in a different route.


Importance of the Panama Canal

To understand the importance of the Panama Canal we only have to think of the consequences for the shipping industry if, all of a sudden, it would not be available. About 144 routes, connecting ports from 160 countries, depend on the waterway on a regular basis. An average of 14,000 transits is made every year through the Panama Canal.

Ships of all types, carrying all kind of cargoes safely navigate the waters of the canal. Containers are at the top of the Panama Canal list users, closely followed by tankers and bulkers. With the new locks, gas tankers have found a shorter route to their destinations.

By using the canal not only does shipping takes a break in fuel expenses, but the environment also takes a break.

Panama Canal - Capt.Ricardo Caballero Vega - Shipping and Freight ResourceAs I write these last few lines, COVID-19 is wreaking havoc in almost every facet of human activity all over the globe. Workers at the Panama Canal, like everywhere else, are not immune to this virus.

However, knowing how important it is for the world that the supply chain moves uninterrupted, especially during a world crisis, the Panama Canal and its workforce are making every effort to provide expeditious and safe service to shipping.

There are about 9,000 canal employees and the waterway provides fresh cash to the Panamanian economy, especially during these days of COVID-19.


Canal Information

The Panama Canal is about 50 miles (80.46 km) long and it takes a ship an average of 10 hours to transit from ocean to ocean. There are 280 working pilots in charge of the nearly 14,000 transits that take place every year. An average of 38 ships uses the waterway each day. Taking a ship through the canal is pure teamwork.

From line handlers, boat operators, tug Captains, locomotive operators, traffic controllers, and all the support personal such as clerks and car drivers. There is always maintenance programs to keep the waterway in optimum conditions for shipping. Dredging and locks maintenance is key to the operation.

In spite of the volume of traffic accident rates are below 0.01 % which positions the waterways as one of the safest in the world. This accomplishment is due to the constant training of workers, including pilots who go through about 14 years program before they qualify for anything, from a 65 feet long sailboat to a 300 metres mega container ships, and also to navigate submarines or other specialized equipment.



Panama became the crossroads of the world after the Europeans discovered the Americas.

pro mundi beneficio - shipping and freight resource - panama canal

It is no coincidence that Panama’s official coat of arms bears the words “Pro Mundi Beneficio” which is Latin for “For the Benefit of the World” and in its national anthem we are encouraged to fulfil our “noble mission”.

As an example, the cruise ships Zaandam and Rotterdam, after being denied arrival at different ports in South America because some of their passengers have died of COVID-19 and some others were infected by the virus, the Panama Canal made arrangements to allow them to transit northbound and reach Fort Lauderdale in Florida.

Two brave Panama Canal pilots stepped forward and volunteered to do the job, not only for humanitarian reasons but also because we have adopted, since the year 2000, the motto ” we love challenges”, ” nos encantan los retos”.

Paul Rink seems to have very aptly summed up the Panama Canal in his book title “The Land Divided The World United“..



Below are some pictures and videos of what we as Panama Canal pilots experience on a daily basis.

Click this link to view a bulker moving from the lower to the middle chamber of Gatun locks. The guy on the port bridge wing is the pilot, he gives instructions to the locomotives and also to the ship’s engine and rudder. It is a tedious job, but also self-rewarding.


Click this link to see what looks like a meeting in the “sky” when two ships meet on the Gatun Lake since it happens at 85 feet above sea level.


Nowadays there a few container ships that, under the booking system, transit as often as three times a month. It is a whole scenario dominated by containers and different types of tankers. Even though Culebra was widened, this is how it looks from the bridge of a mega-ship.


Here is the Chagres River. Probably the only river in the world which waters flow into two oceans. If it could talk, it would tell us the best version of the history of the Panama Canal. It is like the heart that beats to keep the waterway alive so it serves the world. Stay safe everyone.

Panama Canal - Capt.Ricardo Caballero Vega - Shipping and Freight Resource

Saludos, Captain Ricardo Caballero Vega.


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  1. It’s one of the most interesting articles I’ve ever read. Panama canal is a marvel to read about and understand It’s one of the most interesting articles I’ve ever read. Panama canal is a marvel to read about and understand

    It’s one of the most interesting articles I’ve ever read. Panama canal is a marvel to read about and understand

  2. Very comprehensible article on the Panama Canal. Thank you!

    I would offer a correction however on the sailing distances saved by ships using the canal.

    Ships sailing between the east and west coasts of the United States shorten their voyage by about 8,000 nautical miles (15,000 km).

    Savings of up to 3,500 nautical miles (6,500 km) are also made on voyages between one coast of North America and ports on the other side of South America.

    Ships sailing between Europe and East Asia or Australia can save as much as 2,000 nautical miles (3,700 km) by using the canal.

    (Reference: Encyclopaedia Britannica)

    These are similar figures to yours but the other way around. They make sense too when one looks at the world map.


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