PANAMA CITY, Panama—In a national referendum in late October, Panamanians voted overwhelmingly to expand the Panama Canal. The project will construct a new set of three-step locks at each end of the canal, which are expected to double capacity along the canal and allow access by wider ships. The estimated $5.25 billion price tag will be paid by canal customers through a system of graduated toll increases. According to the Panama Canal Authority (ACP), this will be the canal’s first major expansion since its opening in 1914.

"We spent years studying, researching, and preparing, and we are ready," said Ricaurte Vasquez Morales, chairman of ACP’s board of directors and concurrent minister for canal affairs. "This project will be done efficiently and transparently."

The larger locks—1,400 feet long, 180 feet wide, and 60 feet deep—and new approach channels will accommodate post-Panamax ships. The new locks will use rolling gates instead of the miter gates currently installed on the Panama Canal, and will use tugboats instead of rail locomotives to position vessels. A system of water-saving basins built adjacent to the new locks will operate by gravity to raise and lower ships, reusing 60 percent of the water in each ship transit, the ACP said. The technology eliminates the need for constructing dams, which would flood or displace communities along the canal’s watershed. The project will be sited to use a significant portion of excavations started by the United States in 1939 for a third set of locks. That work was suspended in 1942 when the United States entered World War II.

The expansion project also includes deepening existing navigation channels and raising the maximum operational level of Gatun Lake by about 1.5 feet. The higher lake level will allow the canal’s water system to supply, on average, 165 million gallons per day additional water, enough to support 1,110 additional lockages annually without affecting the water supply for human use.

A preconstruction phase lasting two to three years will include development of final designs, physical models, specifications and contracts, contractor pre-classification, and contractor selection. Dry excavation and dredging of existing channels is expected to begin immediately during this phase. The ACP expects to complete the entire project in 2014.