Deadline to resolve Panama Canal expansion receives extension to Feb. 1

Work on expanding the Panama Canal will continue through at least next week after the construction consortium officially extended the deadline until Feb. 1 to resolve a dispute over $1.6 billion in cost overruns. The deadline had been set for this past Monday. However, the Panama Canal Authority and the consortium threatening to shut down the project have kept negotiations going.

Panama officials said a proposal presented this week by the consortium Grupos Unidos por el Canal (GUPC) could resolve the dispute. 

The canal expansion already had been delayed from 2014 to the summer of 2015. Reuters reported Thursday that the waterway’s completion could be delayed until 2020 if GUPC, led by the Spanish construction company Sacyr, can’t come to an agreement with the canal authority. The Panama government has guaranteed the ambitious project will be completed by 2015 in spite of the current conflict.

The expansion will place a third set of locks on the all-important transportation corridor, allowing for larger ships to pass through. Estimates say Panama could quadruple its $1 billion of annual revenue from toll fees once the expansion is complete.