International Chamber of Shipping

Transcription

1 Preliminary Discussions Regarding Changes in Tolls and Regulations that would be implemented with the Expansion of the Panama Canal International Chamber of Shipping December 10, 2012

2 DISCLAIMER. The information, documents, reports, maps and photographs displayed in this PowerPoint presentation is sole proprietary of the ACP or used with the authors authorization; therefore its modification, reproduction, distribution or publication for any purpose is prohibited. Its use requires previous authorization of the ACP.

3 Agenda Statement of Compliance with Anti-Competition Law Update on Canal Traffic and Expansion New Regulations and Requirements for Transiting Vessels in the Expanded Canal Brief History of Canal Tolls and Admeasurement System General Discussion on Principles of Future Tolls Structure Economies of Scale Derived from the Utilization of Larger Ships through the Expanded Canal Next Steps New Improved Reservation System (JIT)

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5 The Panama Canal: Results and Statistics FY-2012

6 Transits: 1,030,200 Cargo: 9,028,195,549 LT

7 Transits PC/UMS tonnage in millions 35,000 Transits vs PC/UMS Tonnage FY 1914 FY , ,000 25, FY 1955 FY 1975 FY 1995 FY , ,000 14, , , Fiscal Year

8 PC/UMS by Market Segments (Tonnage) FY 2010 FY 2012

9 Main Routes - FY 2012 Total (long tons) M East Coast US -- Asia 84.3M West Coast South America East Coast US 27.6M West Coast South America -- Europe 14.4M West Coast US Europe 9.7M West Coast Central America East Coast US 12.2M

10 Canal Expansion Program Components Deepening of Pacific and Atlantic entrance channels Deepening and widening of the Gatun Lake navigation channel Construction of new access channel for Pacific Locks Construction of new Post Panamax Locks and water saving basins in the Atlantic and the Pacific Increase the maximum operating level of Gatun Lake

11 Agenda Statement of Compliance with Anti-Competition Law Update on Canal Traffic and Expansion New Regulations and Requirements for Transiting Vessels in the Expanded Canal

12 NEW PANAMAX VESSEL REQUIREMENTS Capt. Guillermo Manfredo Jr. Canal Port Captain Panama Canal Authority December 10, 2012

13 Definitions and requirements applicable to all vessels intending to transit the new locks at the Panama Canal.

14 Vessel Requirements The Panama Canal Authority (ACP) reminds all customers that vessels arriving at Canal waters, whether for docking or transiting the Panama Canal, must comply with vessel requirements, as stated in the Maritime Regulations for the Operation of the Panama Canal and OP s Notice to Shipping No. N-1-20XX, Vessel Requirements.

15 Definitions Panamax: All vessels that comply with the size and draft limitations of the actual locks; namely, meters in length by 32.3 meters in beam by meters TFW draft. Panamax Plus: All Panamax vessels authorized for TFW drafts greater than meters up to 15.2 meters and approved for transit of the new locks. New Panamax: All vessels with dimensions greater than Panamax or Panamax Plus that comply with the size and draft limitations of the new locks; namely, 366 meters in length by 49 meters in beam by 15.2 meters TFW draft. 49 m (160 ) Panamax Plus 18.3 m (60 ) min m (93 ) max m New Panamax (50 ) TFWD New locks' maximum vessel size: 12,600 TEU 13,200

16 Approach to New Panamax Locks APPROACH STRUCTURE. #1 #3 NEW PANAMAX LOCKS. #2 #4 BALBOA REACH. BUOY #28.

17 Secured inside New Panamax Locks chambers #2 #1 LOWER CHAMBER, NEW PANAMAX LOCKS.

18 Moving between New Panamax Locks chambers EXISTING GATUN LOCKS. UPPER CHAMBER, NEW PANAMAX LOCKS. #2 #1 MIDDLE CHAMBER, NEW PANAMAX LOCKS.

19 Requirements - New Panamax Locks Maximum Length (1): The maximum length overall including bulbous bow for commercial or noncommercial vessels acceptable for regular transit is 366 meters. Vessels transiting the Canal for the first time, whether newly-constructed or newlymodified, are subject to inspection and prior review and approval of vessel plans. Vessels without prior approval and/or not in compliance with Canal requirements may experience delays or be denied transit. New Panamax Length of New Panamax 366 meters

20 Requirements - New Panamax Locks Maximum Length (2): The maximum length for integrated tug-barge (ITB) combination acceptable for regular transit is 366 meters overall, including the tug. A tug-barge combination must transit together as one unit with the tug supplying propelling power.

21 Requirements - New Panamax Locks Maximum Length (3): The maximum aggregate overall length for non-self-propelled vessels acceptable for transit is 305 meters, including accompanying tugs. Accompanying tugs must lock through with the non-self-propelled vessel. One time only transits that exceed these limitations may be permitted on a case-bycase basis with prior approval of the Transit Operations Division Executive Manager.

22 Requirements - New Panamax Locks Maximum Beam: The maximum beam for commercial or non-commercial vessels and the integrated tug-barge combination acceptable for regular transit is 49 meters, measured at the outer surface of the shell plate, including all protruding structures below the top of the lock walls. 49 meters The maximum beam for non-selfpropelled vessels, other than integrated tug-barge combinations, acceptable for transit is 36.5 meters. One time transit of wider vessels may be permitted with prior approval of the Transit Operations Division Executive Manager. New Panamax

23 Requirements - New Panamax Locks Draft: The maximum permissible draft for Canal transits has been set at 15.2 meters Tropical Fresh Water (TFW) at a Gatun Lake level of meters or higher. Gatun Lake density is tons/m³ at 29.4 ºC. This provides a safe navigational margin of at least 1.52 meters over critical elevations in the navigational channels and a clearance over the lock sills of 3.05 meters m (50 )

24 Requirements - New Panamax Locks Protrusions (1): Anything that extends beyond a vessel's hull, except for the main anchors, shall be considered a protrusion and subject to all applicable regulations and limitations. The ACP is not responsible for damages to protrusions, whether permanent or temporary. Vessels with protrusions may be permitted to transit provided that such protrusions will not interfere with the safe transit of the vessel or present a hazard to Canal structures and appurtenances, as determined by the Transit Operations Division Executive Manager. Before transit is permitted, the master of the vessel will be required to complete a form Undertaking to Release and Indemnify to exonerate and indemnify the ACP from liability in case of an accident or damages sustained to or as a result of these protrusions.

25 Requirements - New Panamax Locks Protrusions (2): >16.24 m 4 m Protrusions of 4 meters or less will be evaluated based on equipment above the lock walls and inside the lock chambers; i.e., lighting, assisting tugboats and fenders. Protrusions, cargo or extensions beyond the ship s side located meters or less above the waterline are not accepted; however, the acceptability criteria for extensions 4 meters beyond the hull and higher than meters from the waterline will be reviewed on a case-by-case basis.

26 Requirements - New Panamax Locks Construction, Number, and Location of Chocks and Bitts (1): The mooring requirements, as stated in OP s Notice to Shipping No. N , Vessel Requirements, will remain unchanged for New Panamax and Panamax Plus vessels. These chocks and bitts will be used by ACP tugs assisting vessels through the new locks, as well as for mooring vessels inside the lock chambers. Shall be capable of withstanding a SWL of 100 tons (981kN) from any direction. SWL of 100 tons SWL of 100 tons

27 Requirements - New Panamax Locks Construction, Number, and Location of Chocks and Bitts (2): Vessels with large flared bows, pronounced counters or unusually high freeboards, such as LNG carriers, container vessels or vehicle carriers, may be required to fit recessed tug bollards into the hull in lieu of the single chocks detailed in this paragraph so that tugs can work without coming in contact with the flare or counter and without requiring extra-long lines and/or inefficient leads. SWL of 100 tons

28 Requirements - New Panamax Locks Construction, Number, and Location of Chocks and Bitts (3): The use of existing roller chocks on LNG carriers will be evaluated for approval for transit, upon request, on a case-by-case basis, provided they are located not less than meters above the waterline at the vessel's maximum Panama Canal draft, are in good condition, meet all requirements for closed chocks. The equivalency of the proposed closed roller chocks shall be submitted for review and acceptance by the ACP.

29 Points of Contact & Drawing Submittals Capt. Guillermo Manfredo (507) Arq. Octavio Stagg (507) DRAWING SUBMITALS Via or in compact disk, diskette or printed form directly to: Courier mail: AUTORIDAD DEL CANAL DE PANAMA División de Operaciones de Tránsito (OPTS) Edificio 910, La Boca Balboa, Panamá República de Panamá (Telephones: /4296) Regular mail: AUTORIDAD DEL CANAL DE PANAMA División de Operaciones de Tránsito (OPTS) Balboa, Panamá República de Panamá The drawings submitted via , disk or diskette should be saved preferably in PDF or TIFF file format, or in a file format compatible with AUTOCAD. All drawing and letter files are to be compressed together into one zip file using the WinZip file compression software.

30 Agenda Statement of Compliance with Anti-Competition Law Update on Canal Traffic and Expansion New Regulations and Requirements for Transiting Vessels in the Expanded Canal Brief History of Canal Tolls and Admeasurement System General Discussion on Principles of Future Tolls Structure

31 The Panama Canal: Pricing Structure Historical Background

32 Panama Canal Pricing System Historical Overview Pricing system originated in 1912 First traffic and tolls studies made by Special Commissioner Emory Johnson Alternatives that were considered: Cargo tonnage Cargo value Displacement tonnage Vessel s deadweight tonnage Vessel s gross tonnage Vessel s net tonnage

33 Mr. Johnson s final recommendations Charge commercial vessels on the basis of their revenue earning capacity volumetric tons Establish a charge for non-commercial vessels based on displacement tonnage Develop a system to determine vessel s Canal tonnage Main reasons for his recommendations: Easy to manage system Simple way of distributing operational costs Generally accepted by the shipping industry

34 Panama Canal Universal Measurement System (PC/UMS) One PC/UMS ton equals 100 cubic feet of cargo carrying capacity

35 Period Panama Canal Tolls to 2013 % Chg Laden Ballast Displ. % Chg laden Cumm laden % -25.0% % -10% % 7.5% % 39% % 52.5% % 67.5% % 84% % 99% % 114% % 131% % 197% % 297% % 358% % 384% Total increase since 1914 $4.61 $3.93 $ %

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38 Pricing system in place until 2002 The system was designed for a breakeven business model that did not consider the commercial value of the service provided. No differentiation made on type and/or vessel size, nor in the risks associated with the cargo and how they affect Canal capacity and cost. One price fits all system was not consistent with the evolution of the shipping industry. The 3 year budget basis would not have allow the possibility to engage in an important investment project such as a capacity expansion.

39 Market Segmentation Vessel Type Dry bulker Container Carriers Liquid Bulkers Reefers Vehicle Carriers Passengers General Cargo Others

40 Admeasurement system applied to containerships until April 30, % of the on-deck container cargo capacity TEU = CP/SUAB tons (Internal measurement) Total volume

41 Tolls per TEU Loaded Vessel Toll per TEU Implementation $42 May 1, 2005 $49 May 1, 2006 $54 May 1, 2007 Vessel in Ballast Toll per TEU Implementation $33.60 May 1, 2005 $39.20 May 1, 2006 $43.20 May 1, 2007

42 ACP tolls basis for passenger ship segment Based upon the maximum passenger capacity (PAX-MC) as specified in the vessels International Tonnage Certificate (ITC (69)). Application determined by the sequential application of two design parameters: Vessel ITC (69) Gross Tonnage. Ratio of vessel PCUMS Net Tonnage (PAX-MC). Vessels > 30,000 gross tons and PCUMS/PAX-MC ratio 33 charged tolls based upon rate of $100 per passenger capacity as specified on the vessels ITC (69). Vessels that do not meet the above criteria continue under the PCUMS basis.

43 Evolution of ACP Pricing Structure - FY Until 2015 New Pricing Structure (Two Phases) TOLLS PER TEU $42 $49 $54 Variable Tariff per full container Subsegmentation of tankers Size Differentiation Ondeck cargo Price Differentiation by segment May 2007 Ro-Ros now part of Vehicle Carrier segment Breakeven model Market Segmentation Admeasure -ment system until 2005 New Admeasurement rules - Passenger Vessels Continued Segmentation

44 Market Segmentation Vessel Type Dry bulker Container Carriers Tankers (crude oil & products) Liquid Gas Carriers Chemical Carriers Reefers Vehicle Carriers and Ro-Ros Passengers General Cargo Others

45 The Panama Canal: Route Competitiveness Analysis Model - PCRCAM

46 Panama Canal Route Competitiveness Analysis Model PCRCAM

47 PCRCAM Fuel Prices (HFO, IFO, MDO) Diesel Prices (Inland) Commodity Prices SDR/Dollar Value Consumer Price Index (CPI) Rail Cost Adjustment Factor (RCAF)

48 PCRCAM

49 PCRCAM

50 PCRCAM

51 Price Variation (% year vs. year) Bunker Price Variation 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% % % IHS/CERA: Bunker HFO % -15.9% -6.8% -11.9% 7.1% 5.6% EIA: Bunker -1.8% 41.2% 1.7% 8.8% 7.6% 4.7% 1.6% 2.0% EIA Diesel Fuel (distillate fuel oil) 6/barrel 21.2% 26.7% -1.4% -8.0% 6.1% 3.3% 1.3% 1.4% FAFA Forecast 1.7% 1.6% 1.4% Future 0.7% -0.5% -0.6% Analyst Forecast 2.6% 3.4% 3.0%

52 Bunker Prices Projected Variation

53 Agenda Statement of Compliance with Anti-Competition Law Update on Canal Traffic and Expansion New Regulations and Requirements for Transiting Vessels in the Expanded Canal Brief History of Canal Tolls and Admeasurement System General Discussion on Principles of Future Tolls Structure Economies of Scale Derived from the Utilization of Larger Ships through the Expanded Canal

54 The Panama Canal: Market Segment Analysis and Pricing Structure Full Containers

55 Full container vessels Costs per TEU (Asia U.S. East Coast) - Both Directions FY 2015 Vessel Size Fuel Charter Rate Ports Canal Cargo Handling Cost per TEU Canal Cost Impact (%) Economies of Scale/TEU Economies of Scale/Service 4, ,139 10% 6, ,090 10% , , ,893 11% ,327, , ,812 11% ,203, , ,767 11% ,011, Assumptions for FY 2015: Utilization Rate: Headhaul 88% Backhaul 47% Panama Canal tolls based on $74/TEU capacity and $8/TEU loaded Cost savings generated by economies of scale/teu by vessel sizes: 6,000 TEU vs. 4,500 TEU: $48.50/TEU $196,410 /service 8,000 TEU vs. 4,500 TEU: $245.85/TEU $1.327 M/service 10,000 TEU vs. 4,500 TEU: $326.52/TEU $2.204 M/service 12,000 TEU vs. 4,500 TEU: $371.76/TEU $3.011 M/service Source: ACP/PCRCAM

56 Proposed Toll Structure for Fiscal Year 2015 Full container vessels A beam range toll structure is proposed for container vessels, as follows: Beam Range Capacity Loaded Empties Less than 80 feet feet feet feet feet* feet feet feet *Draft exceeding 39.5 Establish a vessel differentiation for the use of the current and the new locks. An analysis of the container vessel fleet indicates a range of vessels from 3,000 TEU to 14,000 TEU that would require the use of the new locks if they were to transit through the Panama Canal. The structure by beam helps provide economies of scale for the larger vessels. Improve the competitiveness of the Panama Canal, particularly in the backhaul.

57 The Panama Canal: Market Segment Analysis and Pricing Structure Dry Bulks

58 Dry Bulk Vessels Costs in $/MT Grain Route US Gulf to Asia FY 2015 Vessel Size Fuel Charter Rates Port Canal Cargo Handling Inland Total Cost Canal Cost Impact (%) Economies of Scale/MT Economies of Scale/Total 55,000 DWT % 95,000 DWT % -$6.06 -$518,180 Assumptions for FY 2015: Utilization Rate: 90% Panama Canal tolls based on approved tariff for AF2014 (Estimated effective tariff = $4.71 per PC/UMS) Cost savings generated by economies of scale by vessel sizes: 95,000 DWT vs. 55,000 DWT: $6.06/MT $518,180/Trip Source: ACP/PCRCAM

59 Dry Bulk Vessels Costs in $/MT Coal Route Colombia to Asia FY 2015 Vessel Size Fuel Charter Rates Port Canal Cargo Handling Total Cost Canal Cost Impact (%) Economies of Scale/MT Economies of Scale/Total 70,000 DWT % 120,000 DWT % $558, ,000 DWT* % -$6.37 -$865,882 *vessels this size are estimated to transit at 80% utilization Assumptions for FY 2015: Utilization Rate: 90%, except vessels 170K DWT at 80% Panama Canal tolls based on approved tariff for AF2014 (Estimated effective tariff = $4.71 per PC/UMS) Cost savings generated by economies of scale by vessel sizes: 120,000 DWT vs. 70,000 DWT: $5.17/MT $558,358/Trip 170,000 DWT vs. 70,000 DWT: $6.37/MT $865,882/Trip Source: ACP/PCRCAM

60 Why use DWT instead of PCUMS? COAL Carbón ANNA S Cargo IMO: TM: MT: 59, DWT: 75,966 Utilización: Utilization: 78.0% CPSUAB: PCUM: PCUMS: 33,095 Peaje: $/MT: $2.37/TM GRAINS Granos FU MIN Cargo IMO: TM: MT: 59, DWT: 72,437 Utilización: Utilization: 81.8% CPSUAB: PCUMS: 31,383 Peaje: $/MT: $2.25/TM PCUMS Mineral IRON de ORE Hierro MEDI TA Cargo IMO: TM: MT: 59, DWT: 76,633 Utilización: Utilization: 77.3% CPSUAB: PCUMS: 32,841 Peaje: $/MT: $2.35/TM PCUM: Control the competitiveness of the Panama Canal

61 Why use DWT instead of PCUMS? Transit Date Vessel Name DWT PCUMS Cargo (MT ) Utilization $/MT Commodity Route Case #1 11/09/11 YASA H.MEHMET 83,482 37,883 61, % 2.62 Grains USEC to Asia 08/03/12 KEY EVOLUTION 83,416 37,879 61, % 2.60 Coal USEC to Asia 11/17/11 YASA H.MULLA 83,482 37,883 60, % 2.65 Iron Ore USEC to Asia Case #2 04/18/12 PORT MENIER 53,825 26,931 47, % 2.43 Grains USEC to Asia 06/23/12 MEDI NAGASAKI 53,098 24,327 47, % 2.20 Coal South America WC to South America EC 02/22/12 SANKO TITAN 52,514 24,943 47, % 2.25 Iron Ore South America EC to Asia Case #3 01/22/12 EVER YOUNG 73,081 31,956 57, % 2.36 Grains USEC to Asia 02/07/12 HARVEST MOON 73,040 31,898 57, % 2.35 Coal USEC to Asia 11/18/11 NAVIOS LIBRA II 70,136 31,068 57, % 2.29 Iron Ore USEC to Asia PCUMS Volumetric measure The utilization of a vessel and the competitiveness of the route depends on the cargo and the cost per ton. of the commodity.

62 Proposed Toll Structure for Fiscal Year 2015 Dry Bulk Vessels Proposed Toll Structure for Dry Bulk Vessels DWT Ranges Start End over Actual Locks By Commodity Grains Coal Iron Ore ODB New Locks Actual Locks New Locks Actual Locks New Locks Actual Locks New Locks Ballast A structure based on DWT allows future evolution of the structure to a fix/variable basis A structure based on DWT relates better to the concept of actual cargo and vessel utilization Differentiation by commodity helps increase competitiveness in specific routes. Establish a vessel differentiation for the use of the current and the new locks. A flexible structure by ranges helps to provide even better economies of scale for the larger vessels

63 The Panama Canal: Market Segment Analysis and Pricing Structure Liquid Bulks

64 Tanker Costs per Ton ($/mt) (WCSA U.S. East Coast) Vessel Size (DWT) Fuel Charter Rate Ports Canal Cargo Handling Cost per Ton Canal Cost Impact (%) Economy of Scale Economies of Scale/Total 70,000 $ 2.64 $ 2.72 $ 2.10 $ 2.95 $ 1.21 $ % 100,000 $ 2.61 $ 1.95 $ 1.97 $ 2.76 $ 1.21 $ % $ 99, ,000 $ 2.54 $ 1.71 $ 1.99 $ 3.25 $ 1.21 $ % $ 101,920 Assumptions for FY 2015: Utilization rate: 70, , 100,000 90%, 140,000 80% Panama Canal Tolls based on FY 2014 rates Cost Savings generated by economy of scale by vessels sizes: 100,000 DWT vs 70,000 DWT: $1.11/mt $99,900 /Trip 140,000 DWT vs 70,000 DWT: $0.91/mt $101,920 /Trip Source: ACP/PCRCAM

65 Why use DWT instead of PC/UMS? Crude oil and petroleum product tankers are classified by the maritime industry by their size based on deadweight (DWT) tons. The cargo capacity is expressed in DWT tons. The use of DWT provides a better understanding of the utilization rate of a vessel because it is more correlated to the commodity type. The use of DWT is a better unit for the analysis of Panama Canal competitiveness-

66 Tanker: Proposal Pricing Structure Based on DWT Ranges Pricing Strategy Based on DWT Ranges DWT Range Tankers Start End Actual Lock New Lock Ballast $ - $ - $ $ - $ - $ $ - $ - $ $ - $ - $ $ - $ - $ $ - $ - $ $ - $ - $ $ - $ - $ above $ - $ - $ -

67 Chemical Tanker: Proposal Pricing Structure Based on CP/SUAB Laden (CP/SUAB) 1st 10,000 $ - 2nd 10,000 $ - Rest $ - Ballast (CP/SUAB) 1st 10,000 $ - 2nd 10,000 $ - Rest $ -

68 Why use m 3 instead of PC/UMS? LPG and LNG carriers are classified by the maritime industry by their size using cubic meters (m 3 ). The cargo capacity for LPG and LNG ships are expressed in cubic meters (m 3 ). The cubic meter is a unit commonly used for the trade of LPG and LNG. LNG contracts are long term and expressed in cubic meters (m 3 ). It eliminates the pricing differentiation caused by the use of PC/UMS. The cubic meter eliminates this difference when comparing the two LNG shipbuilding technology types, moss and membrane.

69 LPG: Proposal Pricing Structure Based on Cargo Capacity in Cubic Meters (m 3 ) Laden (m 3 ) 1st 10,000 $ - 2nd 15,000 $ - 3rd 30,000 $ - Rest $ - Ballast (m 3 ) 1st 10,000 $ - 2nd 15,000 $ - 3rd 30,000 $ - Rest $ -

70 LNG: Proposal Pricing Structure Based on Cargo Capacity in Cubic Meters (m 3 ) Laden (m 3 ) 1st 60,000 $ - 2nd 30,000 $ - 3rd 30,000 $ - Rest $ - Ballast (m 3 ) 1st 60,000 $ - 2nd 30,000 $ - 3rd 30,000 $ - Rest $ -

71 The Panama Canal: Market Segment Analysis and Pricing Structure Vehicle Carriers / RoRos

72 Vehicle Carriers/RoRos Costs per CEU (Asia U.S. East Coast) - Both Directions FY 2015 Vessel Size Fuel Charter Rate Ports Canal Cargo Canal Cost Cost per CEU Handling Impact (%) 4,500 $ 173 $ 141 $ 15 $ 54 $ 102 $ % 5,000 $ 140 $ 115 $ 14 $ 54 $ ,000 $ 138 $ 108 $ 14 $ 53.7 $ ,000 $ 119 $ 97 $ 13 $ 52 $ ,000 $ 130 $ 89 $ 13 $ 49 $ Economies of Scale/CEU Economies of Scale/Service $ 13% , $ 13% , $ 14% , $ 13% , Assumptions for FY 2015: Utilization Rate: Headhaul 80% Backhaul 20% Panama Canal tolls based on FY 2013 rates Cost savings generated by economies of scale by vessel sizes: 5,000 CEU vs. 4,500 CEU: $59.05/CEU $236,200/service 6,000 CEU vs. 4,500 CEU: $70.03/CEU $336,148/service 7,000 CEU vs. 4,500 CEU: $101.19/CEU $566,657/service 8,000 CEU vs. 4,500 CEU: $ /CEU $654,482/service Source: ACP/PCRCAM

73 The Panama Canal: Toll Rate Ranges (Bands)

74 Toll Rate Ranges (Bands) Market Segment Laden (shown) Ballast Possible Toll Structure with Rate Ranges Tolls per Unit of Measurement proposed Vessel Size Range Top Limit in DWT 20K 40K 60K 80K 100K 120K 140K 160K Over Top T1 T2 T3 T4 T5 T6 T7 T8 T9 Bottom B1 B2 B3 B4 B5 B6 B7 B8 B9 Top T1 T2 T3 T4 T5 T6 T7 T8 T9 Bottom B1 B2 B3 B4 B5 B6 B7 B8 B9

75 Agenda Statement of Compliance with Anti-Competition Law Update on Canal Traffic and Expansion New Regulations and Requirements for Transiting Vessels in the Expanded Canal Brief History of Canal Tolls and Admeasurement System General Discussion on Principles of Future Tolls Structure Economies of Scale Derived from the Utilization of Larger Ships through the Expanded Canal Next Steps New Improved Reservation System (JIT)

76 The Panama Canal: Conclusions and Next Steps

77 Conclusions The Expanded Canal will continue to provide to its clients the traditional values that have been steadily improved over the years and will offer additional values related to economies of scale and increased capacity. The Canal also expects to benefit from the additional values added and increased capacity. The Canal is seeking feedback from the industry, especially in respect to their anticipated needs and in regards to information requirements that the Canal will have in order to meet those identified needs. Volume growth and management is expected to be a critical driver of Canal strategy in the initial years of the Expanded Canal operation. The Canal wants to develop pricing structures that more closely align with the business models of the industry. Structures which also facilitate the strategies of volume growth. The Canal is sponsoring a Conference in Panama in 2014.

78 Near Term / Next Steps Analysis of Client Feedback from December 10th Kick-off meeting with ICS. January 18, 2013 meeting with World Shipping Council in Washington DC. Early February meeting in London with Liquid and Dry Bulk segments. Analysis and incorporation, where appropriate of unsolicited or additional (independent of meeting) inputs from interested parties. Consolidations, of feedback and results of currently scheduled meetings, development of any appropriate adjustments, internal ACP consultation and feedback to ICS.

79 The Panama Canal: Improved Reservation System Just in Time Initiative

80 Just intime Initiative Purpose ACP is developing the concept of a just-in-time transit, which will consist of a value added service for booked vessels employing the Panama Canal. Vessels that elect a Just-in-Time transit service shall coordinate closely with ACP a transit time within permissible operational windows, depending on vessel type and restrictions. Such vessels shall arrive at Canal waters on time to be serviced expeditiously.

81 Just in Time Enablers Satellite AIS Vessel monitoring and tracking

82 Just in Time Enablers Transit planning and tentative service time notifications ETA s database Arrival list Planning Algorithm Tentative Transit Time notifications

83 Just in Time Trial Period Operational tests of the just in time concept will begin soon to acquire as much information as possible in order to establish its feasibility and value. The information gathered during the development and completion of the tests will help in the assessment of its effectiveness and to perform additional system adjustments. Modifications to our Maritime Regulations, Operations Manuals, guidelines and procedures that apply to the implementation of the new service will be required. The operational test will initiate in January 2013 for approximately two or three months. Will need customer participation to insure proper information is transmitted for adequate vessel tracking and precise transit scheduling.

84 Date February 4 6, 2014 World Maritime and Logistics Outlook Panama 2014 Objectives Raise awareness of the upcoming opening of the expanded Canal. Promote Panamanian transportation and logistics platform among maritime industry members. Provide information on Canal tolls, operation procedures and regulations applicable to the expanded Canal. Promote discussion on topics related to the industry situation, specific market segments, transportation and logistics. Present ACP s new commercial business development activities. Register at least 400 attendees.

85 World Maritime and Logistics Outlook Panama February 2014 Audience Port Authorities Shipowners and Shipping Companies Shipping agencies International Maritime Associations and Organizations Retailers Exporters Maritime classification societies Shipyards 3PL

86 Tracks 1. Maritime Outlook Container Dry Bulk Liquid Bulk & LNG Car carrier/roro Cruise 2. Logistics & Supply Chain Retailing & Distribution Transshipment Panama s Logistics Platform-Latin American Opportunities 3. Trade Routes World Maritime and Logistics Outlook Panama February Panama Canal Users Forum (tolls, booking, regulations, operating procedures applicable to the use of the waterway) 5. New business development at the Panama Canal Authority

87 Preliminary Discussions Regarding Changes in Tolls and Regulations that would be implemented with the Expansion of the Panama Canal International Chamber of Shipping December 10, 2012