74,M 53- ^ I SEA-LEVEL CANAL STUDIES HEARINGS BEFORE THE SUBCOMMITTEE ON THE PANAMA CANAL OF THE COMMITTEE ON MERCHANT MARINE AND FISHERIES HOUSE OF REPRESENTATIVES NINETY-FIFTH CONGRESS SECOND SESSION ON H.R. 10087 A BILL TO PROVIDE FOR AN UPDATING OF THE REPORT OF THE ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY COMMISSION H.R. 13176 A BILL TO PROVIDE FOR AN UPDATING OF THE REPORT OF THE ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY COM- MISSION AND FOR THE ESTABLISHMENT OF A JOINT UNITED STATES-PANAMA SEA-LEVEL CANAL STUDY COMMISSIOI FOR OTHER PURPOSES JUNE 21, 27, 28, 1978 V Serial No. 95-51 Printed for the use of the Committee on Merchant Marine\y|44.^fc5iJWSijB«QVi< \ SEA-LEVEL CANAL STUDIES HEARINGS BEFORE THE SUBCOMMITTEE ON THE PANAMA CANAL OF THE COMMITTEE ON MERCHANT MARINE AND FISHERIES HOUSE OF REPRESENTATIVES NINETY-FIFTH CONGRESS SECOND SESSION ON H.R. 10087 A BILL TO PROVIDE FOR AN UPDATING OF THE REPORT OF THE ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY COMMISSION H.R. 13176 A BILL TO PROVIDE FOR AN UPDATING OF THE REPORT OF THE ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY COM- MISSION AND FOR THE ESTABLISHMENT OF A JOINT UNITED STATES-PANAMA SEA-LEVEL CANAL STUDY COMMISSION, AND FOR OTHER PURPOSES JUNE 21, 27, 28, 1978 Serial No. 95-51 Printed for the use of the Committee on Merchant Marine and Fisheries U.S. GOVERNMENT PRINTING OFFICE 32^61 O WASHINGTON : 1978 COMMITTEE ON MERCHANT MARINE AND FISHERIES JOHN M. MURPHY, New York. Chairman PHILIP E. RUPPE, Michigan PAUL N. McCLOSKEY, Jr., California GENE SNYDER, Kentucky EDWIN B. FORSYTHE, New Jersey DAVID C. TREEN, Louisiana JOEL PRITCHARD, Washington DON YOUNG, Alaska ROBERT E. BAUMAN, Maryland NORMAN F. LENT, New York DAVID F. EMERY, Maine ROBERT K. DORNAN, California THOMAS B. EVANS, JR., Delaware PAUL S. TRIBLE, JR., Vlrglna THOMAS L. ASHLEY, Ohio JOHN D. DINGELL, Michigan PAUL G. ROGERS, Florida WALTER B. JONES, North Carolina ROBERT L. LEGGETT, California MARIO BIAGGI, New York GLENN M. ANDERSON, California E (KIKA) DE LA GARZA, Texas RALPH H. METCALFE, Illinois JOHN B. BREAUX. Louisiana FRED B. ROONEY, Pennsylvania BO GINN, Georgia GERRY E. STUDDS, Massachusetts DAVID R. BOWEN, Mississippi JOSHUA EILBERG, Pennsylvania RON DE LUGO, Virgin Islands CARROLL HUBBARD, JR., Kentucky DON BONKER, Washington LES AdCOIN, Oregon NORMAN E. D'AMOURS, New Hampshire JERRY M. PATTERSON, California LEO C. ZEFERETTI, New York JAMES L. OBERSTAR, Minnesota WILLIAM J. HUGHES, New Jersey BARBARA A. MIKULSKI, Maryland DAVID E. BONIOR, Michigan DANIEL K. AKAKA, Hawaii Carl L. Perian, Chief of Staff Ernest J. Corrado, Chief Counsel Frances Still, Chief Clerk W. Patrick Morris, Chief Minority Counsel Stjbcommittee on Panama Canal RALPH H. METCALFE, Illinois, Chairman GENE SNYDER, Kentucky ROBERT K. DORNAN, California PHILIP E. RUPPE, Michigan (ex officio) ROBERT L. LEGGETT, California DAVID R. BOWEN, Mississippi CARROLL HUBBARD, JR., Kentucky BO GINN, Georgia LEO C. ZEFERETTI, New York JOHN M. MURPHY, New York (ex officio) Terrence W. Modglin, Professional Staff Coleman Conroy, Professional Staff Bernard Tannenbadm, Consultant Nicholas T. Nonnenmacher, Professional Staff, Minority (H) CONTENTS Hearings held — Page June 21, 1978 1 June 27, 1978 115 June 28, 1978 297 Text of — H.R. 10087 G H.R. 13176 9 Amendment No. 1932 to H.R. 8309 2 Report from — Transportation Department 27 State Department 29 Statement of — Brown, John, legislative director, International Union of Operating Engineers, AFL-CIO 34 Calhoon, Jesse M., president, Marine Engineers' Beneficial Association. 298 Challinor, Dr. David, Assistant Secretary for Science of the Smith- sonian Institution 198 Constant, Thomas M., Secretary, Panama Canal Company 189 Dolgen, David, director of legislative activities. Maritime Trades Department, AFL-CIO 34 Dolvin, Lt. Gen. Welborn G., U.S. Army (Ret.), Department of Defense Representative, Panama Canal Treaty Affairs 173 DuVal, Capt. Miles P., Jr., U.S. Navy (Ret.) 391 Eddinger, John, executive director. National Association of Dredging Contractors 34 Prepared statement 78 Fortune, Terence J., attorney adviser. Department of State 116 Gravel, Hon. Mike, a U.S. Senator from the State of Alaska 34 Prepared statement 46 Gray, Comdr. Anthony W., Jr., Assistant Branch Head, Western Hemisphere, Politico-MiHtary Division, Office, Chief of Naval Operations 173 Holbrook, Marni, environmental associate, the Izaak Walton League of America 375 Prepared statement 372 Jones, Dr. Meredith, Curator, Department of Invertebrate Zoology, National Museum of Natural History, Smithsonian Institution 198 Kujawa, Leonard J., partner, Arthur Andersen & Co 324 Marlowe, Howard, appearing on behalf of Jesse M. Calhoon 298 Mundy, Daniel J., legislative director of the Building and Construction Trades Department, AFL-CIO 7G Murphy, Hon. John M., a Representative in Congress from the State of New York 33 Ortman, David, Friends of the Earth 375 Prepared statement 340 Parfitt, Gov. H. R., Panama Canal Company 186 Popper, Ambassador David H., Coordinator for Treaty Implementa- tions, Department of State 116 Robins, Dr. C. Richard, professor of marine science, University of Miami 375 Prepared statement 374 Saul, Richard, director of domestic shipping activities. Transportation Institute 34 Prepared statement 78 Selleck, Col. Clyde A., Jr., Executive Director, Civil Works, Office of Chief of Engineers, U.S. Army 173 (III) IV statement of — Con. Sheffey, Col. John P. (Ret.), former military assistant for Canal affairs, Office of the Secretary of the Army, and current executive 'P'^se vice president, National Association for Uniformed Services 302 Spear, Moncrieff J., Treaty Implementation Staff, Department of State 116 Turner, J. C, general president, International Union of Operating Engineers, AFL-CIO 77 Vogel, Herbert D., consulting engineer 388 Wyrough, Richard R., Deputy to Ambassador Popper 116 Additional material supplied — Army Department: Transiting of a 265,000-DWT ship 178 Sea-level canal safety 181 Challinor, David : Bulletin of the Biological Society of Washington No. 2 — "The Panamic Biota: Some Observations Prior to a Sea-level Canal"- 249 Responses to Mr. Nonnenmacher's questions 248 The Atlantic-Pacific Intei oceanic Canal Study Commission (Study of Engineering Feasibility) 257 Defense Department: Cost of nuclear Vessels 185 Sea-level canal vulnerability 183 Dolgen, David: Policy statement of the executive board meeting, Maiitime Trades Department, AFL-CIO, Bal Harbour, Fla., Feljruary 17, 1978 81 DuVal, Capt. Miles: An Engineer's Evaluation of Isthmian Canal Policy (April 1956), by E. S. Randolph 461 Isthmian Canal Policy — An evaluation (March 1955) 415 Panama Canal (Encyclopaedia Britannica 1970) 450 Questions of Mr. Dornan and answers thereto 479 The Interoceanic Canal — A problem (December 1964) 442 * The marine operating problems, Panama Canal, and the solution (February 1947) 428 Gravel, Senator Mike: Answers submitted to questions posed by Mr. Metcalfe 88 Answers to Mr. Snyder's questions 110 Holbrook, Marni: Questions of Mr. Metcalfe and answers thereto 385 Kujawa, Leonard J.: Questions of Mr. Modglin and answers thereto 330 Questions of Mr. Nonnenmacher and answers thereto 336 Marlowe, Howard: Would a new sea-level canal encourage the estab- lishment of new trade routes? 301 Metcalfe, Hon. Ralph H.: Article XII. A sea-level canal or a third lane of locks 240 National Academy of Sciences 1972 report dated September 28__ 249 Panama Canal traffic and revenue study 1978-2000 268 Questions for — Senator Mike Gravel -_ 87 National Research Council: Committee on ecological effects of a sea-level canal 235 Navy Department: Size and speed of ships 179 Distances via Panama and Nicaragua 185 Newman, William A. : The National Academy of Science Committee on the Ecology of the Interoceanic Canal 350 Ortman, David: Article of November 1977: "Not Man Apart — Mingling the Two Oceans" 363 Questions of Chairman Metcalfe and responses 386 Text of a telegram sent to President Carter by 11 national environmental organizations 370 Panama Canal Company: Alternate routes evaluatioif 195 Deforestation 196 Additional material supplied — Con. Panama Canal Co.— Con. Page Question of Mr. Nonnenmacher and answered by Mr. Constant.- 197 Vessels too large to transit canal 194 Robins, Dr. C. Richard: Questions of Mr. Metcalfe and responses thereto 377 Questions of Mr. Nonnenmacher and responses thereto 380 The role of education in technology transfer 378 Sheffey, Col. John P. : Criteria for channel . 314 Questions of Mr. Nonnenmacher and answers thereto 320 Skulberg, Olav M.; Opinion on proposed sea-level canal, Panama 349 Snyder, Hon. Gene: Questions for Senator Gravel 109 Excerpt from Congressional Record of June 15, 1976: "Congress faced up to Panama Canal's vulnerability 70 years ago! Had President Ford been in office then, would it ever have been built?" 9G State Department: Documents involved in the ratification ceremony 131 Need for a sea-level canal 127 Questions of Mr. Nonnenmacher and answered by Ambassador Popper 168 Two canals competition of operation 128 Use of nuclear explosives 1G8 Vantine, Capt. W. H.: Panama Canal major modernization — Octo- ber 15, 1973 411 Vogel, Herbert D. : Questions of Mr. Nonnenmacher and answers thereto 389 Wadsworth, Frank H.: Deforestation — death to the Panama Canal _ 168 Communications submitted — Beeton, Alfred M. : Letter of September 28, 1977, to Hon. Frank Press. 224 Bilonick-Paredes, R. A.: Letter of June 26, 1978, to Senator Mike Gravel 82 Edey, Marion: Memorandum for Frank Press of August 23, 1977, on followup on Panama Sea-Level Canal issue 340 Grandy, John W., IV, et al.: Letter of October 26, 1977, to "Dear Senator" -. 371 Gravel, Sen. Mike: Letter of October 30, 1978, to Hon. Gene Snyder. 93 Kimbal, Thomas L.: Letter of July 20, 1978, to Hon. Ralph H. Metcalfe 387 Kujawa, Leonard J.: Letter of April 18, 1978, to Senator Mike Gravel. 74 McCosker, John E.: Letter of August 29, 1977, to Dr. Alfred M. Beeton 344 Mclntyre, Jim: Memorandum of October 6, 1977, to the President on sea-level Panama Canal study 237 Randolph, E. S.: Memorandum of March 26, 1943, to Governor of Canal Zone 466 Robins, C. Richard: Letter of August 1, 1978, to Hon. Ralph H. Metcalfe 378 Roosevelt, President Theodore: Letter of February 19, 1906, to the Senate and House of Representatives 459 Sheffey, John P.: Letter of July 17, 1978, to Nicholas T. Nonnen- macher 320 Vantine, Capt. W. H.: Letter of October 25, 1973, to "Dear Congress- man" 411 Digitized by the Internet Archive in 2011 with funding from University of Florida, George A. Smathers Libraries with support from LYRASIS and the Sloan Foundation http://www.archive.org/details/sealevelcanalstuOOunit UPDATING OF SEA-LEVEL CANAL STUDIES WEDNESDAY, JUNE 21, 1978 House of Representatives, Committee on Merchant Marine and Fisheries, Subcommittee on Panama Canal, Washington^ D.C. The subcommittee met, pursuant to notice, at 2:36 p.m., in room 1301, Longworth House Office Building, Hon. Ralpli H. Metcalfe (chairman of the subcommittee) presiding. Present : Representatives Metcalfe, Murphy, Snyder, Dornan. Staff present : Carl Perian, chief of staff ; Ernest J. Corrado, chief counsel; Coleman Conroy, professional staff member; Terrence Modglin, professional staff member ; Nicholas T. Nonnenmacher, pro- fessional staff member, minority ; and Anita Brown, clerk. Mr. Metcalfe. The Subcommittee on Panama Canal will come to order. I ask unanimous consent for the Panama Canal Subcommittee to sit today, during the 5-minute rule, for the purpose of taking testi- mony only. Mr. Snyder. Mr. Chairman, reserving the right to object, and I shall not object, I am not even certain that it would make any dif- ference, because such consent would have to be obtained from the House under the Rules. As I indicated to the chairman, I did check with the Clerk, and no permission was obtained for the sitting of this committee during the 5 minute rule, and it is subject to objection by any member. As I indicated to the chairman, the distinguished Senator from Alaska is here, and not only is he here, but because of our vote, he has had to cool his heels for 1 hour, and out of respect for the Sena- tor, and the fact that he is here, I do not intend to object. However, I want the Chair to be on notice that unless my opinion changes about the subject matter of these hearings, in the days ahead I will use whatever parliamentary tactics I may find available to me to see that we do not move forward with building another canal. I withdraw my objection, and have no further statement. Mr. Metcalfe. I thank the gentleman for his cooperation. The Chair has attempted to get the unanimous consent of the House, but unfortunately, the Speaker has not been in the Chair, and therefore I could not obtain it. This is the reason for my unanimous consent request. Let the record show that the Chair expresses his appreciation to the gentleman from Kentucky for his cooperation. Ladies and gentlemen, good afternoon. This is the first of 3 days of hearings which will address the question of whether the "1970 (1) Interoceanic Canal Study" should be updated. These" hearings will also address whether the United States should now join with Panama to jointly study the feasibility of a sea-level canal on the Isthmus. More specifically, our hearings will focus upon three legislative measures. On May 4 the U.S. Senate approved an amendment to the Navigation Development Act — H.R. 8309 — an amendment that would provide $8 million for an International Sea-Level Canal Study Commission. The author of the amendment, the distinguished Demo- cratic Senator from AlasTta, is our first witness in these hearings., He has brought with him a distinguished panel who, I understand, will elaborate upon some of the Senator's contentions. In addition to discussing the Gravel amendment to H.R. 8309, these hearings will also consider two bills that have been introduced by the committee chairman, H.R. 10087 and H.R. 13176. [A copy of the amendment to the Navigation Development Act and a copy of both H.R. 10087 and H.R. 13176, and reports thereon, follow :] Amendment No. 1932 to H.R. 8309 (Navigation Development Act) — May 4, 1978 purpose: to establish a commission to assess the technical, economic, and environmental feasibility of constructing a sea-level canal) (Mr. Gravel of Alaska, for himself and Mr. Magnuson) The amendment is as follows : Sec. — . (a) (1) There is hereby established a Commission to be known as the International Sea-Level Canal Study Commission, hereinafter referred to as the "Commission". (2) The Commission shall conduct such studies and investigations as may be necessary, including onsite surveys, to update the report of the Atlantic-Pacific Interoceanic Canal Study (J^mmission (submitted pursuant to Public Law 88- 609) and to prepare an envirohmental impact statement in accordance with section 102 of the National Environmental Policy Act. The Commission shall, not later than three years from the date of enactment of this section, submit to the President and the Congress a report on its findings and recommenda- tions. The Commission shall cease to exist six months after submission of such report. All records and papers of the Commission shall thereu^n be delivered to the Administrator of General Services for deposit in the Archives of the United States. (b) Studies and investigations undertaken by the Commission shall include, but not be limited to — (A) an inventory and assessment of flora, fauna and ecosystems of the Isthmus of Panama including, but not limited to — (i) potential migration of marine organisms through a sea-level canal and the potential ecological effects of any such migration; (ii) natural or manmade barriers that might mitigate the effects of any such migration ; and (iii) other potential environmental elTects of a sea-level canal; (B) an analysis of the best techniques and equipment presently available or which could be developed to excavate a sea-level canal; (C) the preparation of alternative designs for financing the construction of a sea-level canal ; and (D) an assessment of the economic feasibility of a sea-level canal, including, but not limited to — (i) a study of the obsolescence of the Panama Canal: (ii) an analysis of a sea-level canal in relation to alternative transporta- tion modes ; (iii) an evaluation of the potential contribution of a sea-level canal to alleviate the problem of world energy shortages ; and ,(iv) an assessment of the impact of a sea-level canal on world commod- ity movements and world port development. 3 ^ (c) Following receipt by the President and the Congress of the report by the Commission pursuant to subsection (a), the Council on Environmental Quality shall afford interested persons an opportunity to present oral and written data, views, and arguments respecting the environmental impact statement submitted by the Commission pursuant to subsection (a). Not later than sixty days fol- lowing the receipt by the President and the Congress of such report by the Commission, the Council on Environmental Quality shall submit to the Presi- dent and the Congress a report, which shall be contemporaneously made avail- able to the public, summarizing any data, views, and arguments received and setting forth the Council's view concerning the legal and factual suflSciency of such environmental impact as the Council considers to be relevant. (d) The President shall, not later than thirty days following the receipt by him of the report of the Council on Environmental Quality pursuant to sub- section (c), transmit his finding and recommendation to the Congress. (e) The Commission shall be comprised of six members as follows: (A) one member appointed by the President of the Senate; (B) one member appointed by the Speaker of the House of Representatives; (C) one member appointed by the President; and (D) three members appointed by the President upon recommendation for appointment by the Republic of Panama. (f) The Chairman of the Commission shall be elected by the Commission from among its members. (g) (1) The Commission or, on authorization of the Commission, any commit- tee of two or more members may, for the purpose of carrying out the provi- sions of this section, hold such hearings and sit and act at such times and places as the Commission or such authorized committee may deem advisable. (2) The Commission is authorized to acquire from any department, agency, or individual instrumentality of the executive branch of the Government any information it deems necessary to carry out its functions under this section and each department, agency, and instrumentality is authorized and directed to furnish to the extent permitted by law such information to the Commission upon request made by the Chairman. (h) (1) Members of the Commission who are employed by the Federal Gov- ernment, including Members of Congress, shall serve without compensation in addition to that received for their services as employees of the Federal Gov- ernment; but they shall be reimbursed for travel, subsistence, and other neces- sary expenses incurred by them in the performance of the duties vested in the Commission. (2) Members of the Commission, other than employees of the Federal Gov- ernment, who are nationals of the United States, shall each receive compensa- tion at a rate not in excess of the maximum rate of pay for GS-18, as provided in the General Schedule under section 5332 of title 5, United States Code, and shall be reimbursed for travel, subsistence, and other necessary expenses in- curred by them in the performance of the duties vested in the Commission. (3) Members of tlie Commission who are nationals of the Republic of Pan- ama shall be compensated as determined by the Republic of Panama ; but they shall be reimbursed for travel, subsistence, and other necessary expenses in- curred by them in the performance of the duties vested in the Commission, not- withstanding any other provision of law. (i) (1) The Commission is authorized to appoint and fix the compensation of a staff director, and such additional personnel as may be necessary to enable it to carry out its functions. The Director and personnel may be appointed with- out regard to the provisions of title 5, United States Code, covering appoint- ments in the competitive service, and may be paid without regard to the provi- sions of chapter 51 and subchapter III of chapter 53 of such title relating to flassification and General Schedule pay rates. Any Federal employees subject to the civil service laws and regulations who may be employed by the Commis- sion shall retain civil service status without interruption or loss of status or privilege. In no event shall any employee other than the staff director receive as compensation an amount in excess of the maximum rate for GS-18 of the General Schedule under section 5332 of title 5, United States Code. In addition, the Commission is authorized to obtain the services of experts and consultants in accordance with section 3109 of title 5, United States Code, but at rates not to exceed the maximum rate of pay for grade GS-18, as provided in the Gen- eral Schedule under section 5332 of title 5, United States Code. (2) The staff director shall be comi)ensated at a rate equal to that for level 2 of the Executive Schedule iu subchapter II of chapter 53 of title 5, United States Code. (.i) The Commission is authorized — (1) to enter into contracts or agreements for studies and surveys with pub- lice and private organizations and. if necessary, to transfer funds to Federal agencies of the Government of the Republic of Panama from sums appropriated pursuant to this section to cari'y out tlie purposes of this Act; (2) to use voluntary and uncompensated services and to accept, hold, ad- minister, and utilize gifts in order to carry out the purposes of the Commis- sion ; and (3) to employ non-United States citizens or nationals, notwithstanding any other provision of law. (k) Any vacancy which may occur on the Commission shall not affect its powers or functions but shall be filled in the same manner in which the original appointment was made. (1) In addition to the studies and investigations provided for in subsection (b) of this section, the United States members of the Commission shall conduct a review and assessment of alternative routes for the construction of a sea- level canal, such review and assessment to include an evaluation of potential routes both within and outside the Republic of Panama. The United States members shall, not later than one year from the date of enactment of this sec- tion, submit to the President and the Congress a report on their findings and recommendations. (m) There are hereby authorized to be appropriated $8,000,000 to carry out the provisions of this section. Funds appropriated imder this section shall be available to the Commission until expended. [Rollcall Vote No. 152 Leg.] Abourezk Allen Anderson Baker Bartlett Bayh Bentsen Biden Byrd, Robert C. Chafee Chiles Church Clark Cranston Culver Curtis Danforth DeConcini Dole Domenici Durkin Bellmon Brooke Bumpers Burdick Byrd, Harry F., Jr. Case Ford Garn Goldwater Griffin Cannon Hart Haskell ox SEA-LEVEL STUDY AMENDMENT Yeas— 63 Eagleton Eastland Glenn Gravel Hansen Hatfield, Mark O. Hatfield, Paul G. Hathaway Heinz Hodges Hollings Huddleston Humphrey Jackson Johnston Kennedy Magnuson Mathias Matsunaga McGovern Melcher Xays— 29 Hatch Hayakawa Helms Javits Laxalt Leahy Lugar McClure Metzenbaum Nelson Not Voting — 8 Inouye Long Mclntyre Moynihan Muskie Nunn Packwood Pell Percy Randolph Ribicoff Riegle Roth Sarbanes Sasser Sparkman Stennis Stevenson Stone Talmadge Wallop Williams Young Zorinsky Proxmire Schmitt Schweiker Scott Stafford Stevens Thurmond Tower Weicker Morgan Pearson So. Mr. Gravers amendment (No. 1932) was agreed to. Mr. Gravel. Mr. I'resident, I move to reconsider the vote by which the amend- ment was agreed to. Mr. Magnuson. I move to lay tliat motion on the table. The motion to lay on the table was agreed to. The Presiding Officer (Mr. Nunn). Are there further amendments? If there be no further amendments to be proposed, the question is on the en- grossment of the amendments and third reading of the bill. The amendments were ordered to be engrossed, and the bill to be read a third time. The bill was read a third time. 95iH CONGRESS IST Session H. R. 10087 IN THE HOUSE OF REPRESENTATIVES NOVEMUER 15, 1977 Mr. Murphy of New York introduced the following bill ; which was lefen-ed to the Committee on ilerchant ^larine and Fisheries A BILL To provide for «an updating of the report of the Atlantic-Pacific Interoceanic Canal Study Commission. 1 Be it enacted by the Senate and House of Representa- 2 tives of the United States of America in Congress assembled, 3 Section 1. The Congress finds and declares : 4 (a) The possihle improvement of interoceanic transit 5 through an enlarged and modernized Panama Caiial or a new 6 Atlantic-Pacific canal is of great national and international 7 interest. 8 (b) The Atlantic-Pacific Interoceanic Canal Study 9 Commission report in 11)70 concluded that there were no 10 technical obstacles of sufficient magnitude to prevent success- 11 ful construction and operation of a sea-level canal between 1 the Atlantic and Pacific Oceans. Since the issuance 'of this 2 report the pohtical, economic, and military circumstances 3 concerning such a canal may have changed. 4 (c) The effect of a sea-level canal upon the environment 5 is imknown, hut there is a possibility that harmful and irre- 6 versible impacts on marine ecosystems might result from 7 the construction and operation of such a canal. 5 {d) The most up-to-date iufonnation on the benefits 9 and costs of the possible constmction and operation of a 10 sea-level canal between the Atlantic and Pacific Oceans 11 should be available to the Congress and the public. 12 (e) It is the purpose of this Act to authorize the Presi- 13 dent to complete the studies and investigations necessary to 14 bring the report of the Atlantic-Pacific Interoceanic Canal 15 Study Commission up to date and to determine the environ- 16 mental effects of a possible sea-level canal betAveen the 17 Atlantic and Pacific Oceans. 18 Sec. 2. The President shall conduct such studies and 19 investigations as may be necessary, including necessary 20 onsite surveys, to update the report of the Atlantic-Pacific 21 Interoceanic Canal Study Commission (submitted pursuant 22 to Public Law 88-G09) and shall submit to Congress no 23 later than five years from the date of this Act a report on 24 the measures which should be taken by the United States 25 concerning a possible sea-level canal between the Atlantic 8 1 and Pacific Oceans. Such studies and investigations shall 2 include a full and complete inventory and onsite assessment 3 of the ecological processes which might be affected by the 4 construction and operation of such a sea-level canal and shall 5 be limited to an assessment of such a canal constructed by 6 nonnuclear means. 7 Sec. 3. The President shall prepare and consider an 3 environmental impact statement in accordance with section 9 102 of the National Environmental Policy Act with respect 10 to any reconmiendations set forth in the report provided in 11 section 2 of this Act. 12 Sec. 4. There are hereby authorized to be appropriated 13 not to exceed $10,000,000 to carry out the provisions of 14 this Act. In order to expedite initiation of the studies and 15 investigations authorized in section 2 of this Act, there is 16 authorized to be expended not to exceed $1,500,000 in 17 fiscal year 1978. .so. M, R. 13176 Ji\ THE nuiJSE OF EErEESENTATIYES ^' June 16, 1978 ' ' ■ ' C ]\rr. ]\[i'ni'iiY of Xow York introducod tlip followinfr bill; wliich was rcforiTil lo tlic Coiiiiiiittoc on ^Icrchaiit iNIiuinc and Fislierips - A BILL To provide for an updating of the report of the Atlantic-Pacific Interoceanic Canal Study Commission and for the estab- lishment of a Joint United States-Panama Sea-Level Canal Study Commission, and for other purposes. 1 Be it enacted by the Senate and House of Representa- 2 tives of the United States of America in Comjrcss assembled, 3 That this Act may be cited as the ''Interoceanic Canal 4 Study Act of 1978". 5 SEC. 2. FINDINGS. 6 The Congress finds and declares the followino-: 7 (1) The potential improvements in interoceanic 8 transit resulting from an enlarged and modeinized 9 Panama Canal or a new Atlantic-Pacific canal are of 10 great national and international significance. 1 10 (2) The Atlantic-Pacific Interoceanic Canal Study 2 Commission report in 1970 concluded that there were no 3 technical obstacles of sufficient magnitude to prevent 4 successful construction and operation of a sea-level canal 5 between the Atlantic and Pacific Oceans. Since the Q issuance of this report the political, economic, and mili- 7 tary circumstances concerning such a canal may have g changed. 9 (3) The effect of a sea-level canal upon the en- 10 vironment is unknown, but there is a possibility that 11 harmful and irreversible impacts on marine ecosystems 12 might result from the construction and operation of such 13 a canal. ■lA (4) The most current information on the benefits 25 and costs of the possible construction and operation of a 2g sea-level canal between the Atlantic and Pacific Oceans yj should be available to the Congress and the public in view of the economic and national security importance of a new canal. SEC. 3. PURPOSES. The Congress declares that the purposes of this Act are the foUowino': 18 19 20 21 22 no (1) To provide for the completion of the studies nA ftnd investigations necessary to make current the report 2= of the Atlantic-Pacific Interoceanic Canal Study Com- 11 1 mission and to determine the environmental effects of a 2 possible sea-level canal between the Atlantic and Pacific 3 Oceans. 4 (2) To provide for the determination based on the 5 best and most current information available of the feasi- 6 bility of and the most suitable site for the construction 7 of a new interoeeanic canal between the Atlantic and 8 Pacific Oceans. 9 (3) To implement, for the United States, that pro- 10 vision of paragraph 1 of Article XII of the Panama 11 Canal Treat}-^ in which the United States and Panama 12 "commit themselves to study jointly the feasibifity of a 13 sea-level canal in the Eepublic of Panama". 14 TITLE I— INTEROCEANIC CANAL STUDY 15 COUNCIL 16 SEC. 101. ESTABLISHMENT. 17 There is hcreb}' established an Interoeeanic Canal Study 18 Council (herc'innftcr referred to in this Act as the 19 "Council"). 20 SEC. 102. DUTIES. ; 21 The Council shall conduct a I'eview and assessment of 22 alternate routes for the construction and operation of a new 23 interoeeanic canal across the Americas, The review and as- 24 sessnient l)y the Council shall include, but not be limited to, 25 with respect to each major alternate route— 32-461 O - 78 - 2 12 1 mission and to determine the environmental effects of a 2 possible sea-level canal between the Atlantic and Pacific 3 Oceans. 4 (2) To provide for the determination based on the 5 best and most current information available of the feasi- 6 bility of and the most suitable site for the constraction 7 of a new interoceanic canal between the Atlantic and 8 Pacific Oceans. 9 (3) To implement, for the United States, that pro- 10 vision of paragraph 1 of Article XII of the Panama 11 Canal Treaty in which the United States and Panama 12 "commit themselves to study jointly the feasibihty of a 13 sea-level canal in the Eepublic of Panama". 14 TITLE I— INTEKOCEANIC CANAL STUDY 15 COUNCIL 16 SEC. 101. ESTABLISHMENT. 17 There is hercl)y established an Interoceanic Canal Study 18 Council (hereinafter referred to in this Act as the 19 "Council"). 20 SEC. 102. DUTIES. : 21 The Council shall conduct a review and assessment of 22 alternate routes for the construction and operation of a new 23 interoceanic canal across the Americas. The review and as- 24 sessnient by the Council shall include, but not be limited to, 25 with respect to each major alternate route — 13 2 (1) an assessment of the general environmental 2 - effects of construction and operation of a new inter- 3 oceanic canal along such route; • 4 (2) a projection of the general terms of agreement 5 stipulated by the country in which the route is located 6 with respect to United States involvement in construc- 7 tion and operation of such a canal ; 3 (3) an estimation of the United States national 9 securit}^ benefits that would be derived from construc- 10 tion of such a canal along such route ; and 11 (4) an estimation of the engineering problems en- 12 tailed in the construction of such a canal along such 13 route. 14 SEC. 103. MEMBERSHIP. 15 (a) XuMBEK AND ArroTXTMEXT. — The Council shall 16 consist of three United States citizen mcml)ers as follows: 17 (1) One meml)cr shall be appointed by the Presi- 18 dent of the Senate. 19 (2) One mcml)er shall be a]>pointed by the Speak- 20 or of the House of Ivcprcsontatives. 21 {?)) One mcm])er shall be appointed by the 22 President. 23 A vacancy in the Council shall ])e filled in the manner in 24 which the original appointment was made. 14 1 (b) CiiAmMAN.— The Cliainiiaii of the Council shall 2 be elected by the Council from among its members. 3 SEC. 104. POWERS. 4 (a) Headings. — The Council or, if authorized by the 5 Council, any committee of two or more members may, for 6 the purpose of carrying out the provisions of this title, hold 7 such hearings and sit and act at such times and places as 8 the Council or such committee deems advisable. 9 (b) Other Poavees. — The Council has such other 10 powers as are set forth in section 301. 11 SEC. 105. SUBMISSIONS. 12 (a) Council. — Xot later than one year after the date 13 of the enactment of tliis Act, the Council shall submit to the li President a document setting forth the results of the review 15 and assessment carried out by it under section 102. 1) One meml)er appointed by the President. 21 (4) Three mem))ers a])pointed by the President from 22 among individuals recommended for appointment by the 23 Republic of Panama. 21 A vacancy in the Commission shall be filled in the manner. 25 in which the original appointment was made. 19 1 (b) Chairman.' — The Chairman of the Commis- 2 sion shall be elected by the Coiiiiuission from among its 3 members. 4 SEC. 204. POWERS. 5 (a) ITkartngs. — The Connnission or, if authorized bv Q the Commission, any committee consisting of two or more 7 members may, for the purpose of carrying out the provisions 8 of this title, hold such hearings and sit and act at such times 9 and places as the Commission or such committee deems 10 advisable. 11 (b) Otuer Powers. — The Commission has such other 12 powers as are set forth in section 301. 13 SEC. 205. ACTION BY COUNCIL ON ENVIRONMENTAL 14 QUALITY. 15 If the Commission submits the environmental report 16 provided for in section 202 (c) to the Congress and the 17 President, the Council on Environmental Quality shall 18 promptly thereafter afford interested pei^sons an opportunity 19 to present oral and written data, views, and arguments re- 20 specting the environmental impact statement included in such 21 environmental report. Not later than six months after the 22 date on which such report is so submitted, the Council on 23 Environmental Quality shall submit to the President and 24 the Congress a document, which shall be made available to 25 the public at the same time, summariziug anv data, views. 20 1 and arguments received from the public and setting forth 2 the views of the Council on Environmental Quality con- 3 cerning the legal and factual sufficiency of such environ- 4 mental impact statement. 5 SEC. 206. FINAL PRESIDENTIAL REPORT. 6 After receiving the Commission reports provided for 7 in section 202 (b) and (c), and after taking into account 8 the views of the Council on Environmental Quality sub- 9 mitted under section 205, the President shall submit to the 10 Congress a final report containing his recommendation re- 11 garding whether or not a sea-level canal should be con- 12 structed, the reasons for such recommendation, and such 13 other views and recommendations as he deems appropriate. 14 SEC. 207. EFFECT ON COMMISSION ACTION. 15 The carrying out of the duties provided for imder this 16 title by the Commission shall be deemed to fulfill the respon- 17 sibilities of the United States under paragraph 1 of Article 18 XII of the Panama Canal Treaty. 19 SEC. 208. TERMINATION OF COMMISSION. 20 The Commission shall cease to exist on whichever of the 21 following days first occurs: 22 (1) The thirtieth day after close of the six-month 23 period referred to in section 202 (c) , if the President 24 does not submit to the Congress a declaration descril)ed 25 in such section before the close of such six-month period. 21 1 jiiul argiunouts received from the public and setting forth 2 I lie views of the Council on Environmental Quality con- 3 ceriiing- the legal and factual sufficiency of such environ- 4 iiu'utal impact statement. -, SKC. 206. FINAL PRESIDENTIAL REPORT. (J After receiving the Commission reports provided for 7 in section 202 (b) and (c), and after taking into account 8 tlie views of the Coimcil on Environmental Quality sub- 9 mitted under section 205, the President shall submit to the 10 Congress a final report containing his recommendation re- 11 garding whether or not a sea-level canal should be con- 12 stnictcd, the reasons for such recommendation, and such 13 other views and recommendations as he deems appropriate. U SEC. 207. EFFECT ON COMMISSION ACTION. !•) The carrying out of the duties provided for imder this IG title by the Commission shall be deemed to fulfill the respon- 17 sibilities of the United States under paragraph 1 of Article 18 XII of the Panama Canal Treaty. 19 SEC. 208. TERMINATION OF COMMISSION. 20 The Commission shall cease to exist on whichever of the 21 following days first occurs : 22 (1) The thirtieth day after close of tiie six-month 23 period referred to in section 202 (c) , if the President 24 does not submit to the Congress a declaration described 2o in such section before the close of such six-month period. 22 1 (2) The thirtieth da}' after the day on whwh tlie 2 Congress receives from the President his opinion on the 3 findings set forth in the report of the Commission sub- 4 mitted under section 202 (b) of this Act, if the President 5 fails to declare that a sea-level canal would he advan- 6 tageous to the United States. 7 ■ (3) The ninetieth day after the day on which the 8 Coimcil on Environmental Quality submits its report to 9 the President and the Congress under section 205. 10 TITLE III— POWERS OF COUNCIL AXD CO^ilMIS- 11 SIOX AND ADMINI8TEATIVE PROVISIONS 12 SEC. 301. POWERS. 13 (a) Ix Geneeal. — For purposes of carrying out its 1-i duties under this Act, the Council and the Commission may 15 each — 16 ( 1 ) secure dircctl}^ from any department or agency 1^ . of the United States information necessary to enal)le it 18 to carry out such duties, and, upon request of the Chair- 19 man of the Council or the Commission, the head of such 20 , department or agency shall furnish such information to 21 that body; 22 (2) accept, use, and dispose of gifts or donations or 23 services or property ; 2J: (3) use the United States mails in the same manner 23 1 and upon the same conditions as other departments and 2 agencies of the United States ; 3 . (4) to such extent, or in such amounts, as are pro- 4 vided in advance in appropriation Acts, enter into con- 5 tracts, agreements, or other transactions without regard 6 to section 3709 of the Revised Statutes of the United 7 States: and 8 (5) utilize, on a reimbursable basis or otherwise, 9 the personnel and facilities of other departments and 10 agencies of the United States. 11 (b) Additional Commission Powees.— (1) The 12 Commission may utilize, on a reimbursable basis or otherwise, 13 the personnel and facilities of any agency of the Government 14 of the Eepublic of Panama for purposes of carrying out its 15 duties under title II. , 16 (2) The Commission may employ Panamanian citizens 17 or nationals, notwithstanding any other provision of law. . 18 SEC. 302. DIRECTOR AND STAFFS OF COUNCIL AND COM- 19 MISSION. • ,i,r 20 (a) DiKECTOR.— The Council and the Commission shall 21 each appoint a Director who shall be compensated at the rate 22 of basic pay in efTcct for level II of the Executive Schedule. 23 (b) Staff, — The Council and the Commission may 24 1 each appoint and fix the pay of such additional personnel as 2 it deems desirable. 3 (c) Applicability of Civil Service Law. — The 4 Director and staff of the Council and of the Commission may 5 be appointed without regard to the provisions of title 5, 6 United States Code, governing appointments in the competi- 7 tive service, and may be paid without regard to the provi- 8 sions of chapter 51 and subchapter III of chapter 53 of 9 such title relating to classification and General Schedule 10 pay rates, except that no individual so appointed may receive 11 pay in excess of the annual rate of basic pay in effect for 12 grade GS-18 of the General Schedule. 13 (d) Federal Employees.— Any Federal employee 14 subject to the civil seiTice laws and regulations who may be 15 detailed to either the Council or the Commission shall retain 1^ civil service status without inteiTuption or loss of status or 1'^ privilege. 18 (c) Experts and Consultants.— The Council and 19 the Coniniission may each i)rocure temporary and intermit- 20 tent services to the same extent as is authorized by section 21 3109 (b) of title 5 of the United States Code, but at rates 22 for individuals not to exceed the daily equivalent of the 23 annual rate of basic pay in effect for grade GS-18 of the 24 (iencral Schedule. 25 ^ SEC. 303. PAY AND TRAVEL EXPENSES. 9 (a)^lN General. — Except as provided in sul)section 3 (1)) , membei-s (if citizens or nationals of tlie United States) 4 of the Council and of the Commission shall each l)e entitled 5 to receive the daily equivalent of the annual rate of basic g pay in efU'ect for grade GS-18 of the General Schedule for rj each day (including traveltime) during which they are en- 8 gaged in the actual perfomiance of duties vested in the 'Coun- 9 cil or the Commission. The compensation of members of the 10 Council or the Commission who are citizens or nationals of 11 the Republic of Panama for service thereon shall be as pro- 12 vided for under Panamanian law. 13 (b) ExcEi'Tiox. — ^Ieml)eis of the Council and the 14 Commission who are full-time officers or employees of the 15 United States or Members of Congress shall receive no addi- 16 tional pay on account of their service on the Council or the 17 Connnission. 18 (c) Travel Expi:nses. — While away from their homes 19 or regular places of business in the performance of services 20 for the Council or tlie Commission, members thereof 21 (whether or not citizens or nationals of the United States) 22 shall be allowed travel expenses, including per diem in lieu 23 of subsistence, in the same manner as persons employed 24 intermittentlv in the Government service are allowed ex- 26 1 peiiscs under section 5703 (b) of title 5 of the United States 2 Code. 3 TITLE IV— AUTHOIUZATIONS AND EFFECTIVE 4 DATES 5 SEC. 401. AUTHORIZATION OF APPROPRIATIONS. 6 (a) For Council. — There are authorized to he appro- 7 priated for purposes of carrying out title I not to exceed 8 $1,000,000. 9 (h) For Commission.— There are authorized to he 10 appropriated for purposes of carrying out title II such suras 11 as may he necessary, hut not to exceed $2000,000, for the 12 twenty-four-nionth period heginning on the month in which 13 the initial appointment of all merahers of the Commission is completed. ■^^ SEC. 402. EFFECTIVE DATES. 1^ (a) Title I.— Title I shall take effect on the date of the -in enactment of this Act. 1^ (h) Title III.— (1) The provisions of title III which ^^ Jipply with respect to the Council shall take effect on the -*^ date of the enactment of this Act. 21 (2) The provisions of title III which apply with respect -^■^ to the Commission shall take effect on the date on which title ■^^ II takes effect under section 107. 27 OFFICE OF THE SECRETARY OF TRANSPORTATION WASHINGTON, D.C. 20590 JUL 3 1978 Honorable John M. Murphy Chairman, Committee on Merchant Marine and Fisheries House of Representatives Washington, D. C. 20515 Dear Mr. Chairman: This Is In response to your request for Departmental comments on H.R. 13176, a bill "To provide for an updating of the report of the Atlantic- Pacific Interoceanlc Canal Study Commission and for the establishment of a Jolitt United States Panama Sea Level Canal Study Commission, and for other purposes." This proposed legislation is being called the "Interoceanlc Canal Study Act of 1978." The bill contains three titles. Title I provides for the creation of a three-member Interoceanlc Canal Study Council (Council) with one appointment each by the President, Speaker of the House of Representatives and President of the Senate for the purpose of conducting a review and assessment of alternate routes for the construction and operation of a new Interoceanlc canal across the Americas. The Council would have one year In which to report to the President the results of its review and assessment. The President would then submit a report to Congress with his comments and any recommendations deemed appropriate. Title II would come Into effect only if the President declares in his report to Congress that it is his intention to implement the principle of paragraph 1 of Article XII of the Panama Canal Treaty which deals with jointly studying the feasibility of a sea-level canal. If Title II comes Into effect there would be established a Joint United States Panama Sea Level Canal Study Commission (Commission) . The members of the Com- mission would be appointed in the same manner as the members of the Council except there would be an additional three members appointed by the President from Individuals recommended by the Republic of Panama. The main duties of the Commission would be to update the 1970 report of the Atlantic-Pacific Interoceanlc Canal Study Commission and prepare 32-461 O - 78 - 3 28 an environmental report. The Commission would have two years In which to submit a report to the President, who In turn submits a final report containing his recommendation on whether or not a sea level canal should be constructed. Title III relates to the powers of the Council and Commission and administrative provisions. Among other provisions, the Council and Commission would each have a Director compensated at the pay rate in effect for level II of the Executive Schedule and have staffs of a size "as it deems desirable." The Council would be authorized funding not to exceed $1,000,000 and the Commission $2,000,000. Article XII of the treaty provides that during the duration of the treaty both parties commit themselves to study jointly the feasibility of a sea level canal in the Republic of Panama. However, we believe it woifld be premature to embark on the study contemplated by Article XII at this time. Decisions concerning the future role of the Panama Canal and the need for a sea-level canal will depend to a great extent on the demands of the market place. A shipper's decision to use the Canal will depend on the competitiveness of alternative routes and modes of transportation. These alternatives include shipments around the Horn in supertankers, new oil or slurry pipelines, railroad transport, or future "land bridge" or "minlbridge" developments. Now that the treaties with Panama have been ratified, these market place decisions can be made in a climate of "certainty" regarding that waterway. Since potential users of the canal will be assured that the canal will continue to be operated efficiently and that its capacity will be increased if economically justified, the canal has the potential to become an Increasingly Important transportation link. Until these market place decisions have been made and their Impact can be assessed, the commercial need for a sea-level canal is not absolutely clear. These market place decisions should materialize in the next few years, and then it should be possible for a study commission to determine the need for and economic feasibility of a sea-level canal. The Office of Management and Budget has advised that there is no objection from the standpoint of the Administration's program to the submission of this proposed report to the Committee. Sincerely, iinocrely, Linda Heller Kanm 29 Depaktment of State, Washington, D.G., September 15 1978. Mr. John M. Murphy, Chairman, Committee on Merchant Marine and Fisheries, House of Representatives. Deab Mr. Chairman : The Secretary has asked me to reply to your letter of June 20, 1978 requesting our views on H.R. 13176 with fespeet to updating the report of the Interoceanic Canal Study Commission and the establishment of a joint U.S. -Panamanian Sea-Level Canal Study Commission. Our comments are directed toward the foreign policy aspects of this bill, and in particular toward its relationship to the provisions of Article XII of the Panama Canal Treaty, which stipulates that ". . . during the duration of this Treaty, both Parties commit themselves to study jointly the feasibility of a sea- level canal in the Republic of Panama. . ." The Department of State would not oppose an uixlating of the 1970 report of the Atlantic-Pacific International Sea-Level Canal Study Commission at an appropriate time. Such a study was contemplated during the negotiations on the Panama Canal Treaty and would be useful as a basis for decision with re- spect to the desirability of constructing another canal. We are concerned that a study at this time could be criticized as premature. It might be preferable to put the new Treaty relationships in place and com- plete consideration of the Treaty implementing legislation before embarking on such a study. Our principal concern is that any study undertaken should serve the pur- pose of the study envisioned in the Treaty. We believe that the organization and procedure of the proposed new Joint U.S.-Panamanian Sea-Level Canal Study Commission should be modified so as to give greater prominence to its bilateral character, so that it more clearly falls within the spirit of the pro- visions of Article XII of the Panama Canal Treaty. This could be done by changes along the following lines : A. The President should be authorized to formalize the joint aspects of the study through an agreement with the Government of Panama which will make it clear that the joint study satisfies the requirements of Article XII of the Treaty. B. Provision should be made in the proposal for assuring that the terms of reference of the study commission are suflSciently broad to allow us to imple- ment arrangements we may conclude with Panama. C. The Panamanian members of the commission should be appointed by the Government of Panama, and not by the President of the United States. D. The proceedings of the commission should be bilingual to the extent necessary. E. The report of the commission should be made to the Governments of the United States and Panama. Changes along these lines would markedly improve the acceptability of any proposed commission in light of the Panama Canal Treaty requirements. With regard to the proposed Interoceanic Canal Study Council, we share the view that this should function as a separate American unit, without Panama- nian participation, in the consideration of canal sites outside of Panama. AVe question the desirability of laying out so specifically, however, the time limits and phasing for the various stages of the proposed study. Given the uncer- certalnties of the situation, it might be preferable to give the President the benefit of greater flexibility. Finally, we would note that the costs of the study envisioned in Article XII of the Panama Canal Treaty, including the funding of the Canal Study Coun- cil and Commission would entail a new financial commitment of $3 million. The OflBce of Management and Budget advises that from the standpoint of the Administration's program there is no objection to the submission of this report. Sincerely, Douglas J. Bennet, Jr., Assistant Secretary for Congressional Relations. 30 Mr. Metcalfe, These hearings are critical because they are the only ones convened in this Congress for the exclusive purpose of dis- cussing a sea-level canal update. The Committee on Merchant Marine and Fisheries, and this subcommittee, has jurisdiction over the Pan- ama Canal and other intoroceanic canals. As a result of this jurisdic- tion, it was the Merchant Marine Committee which reported legis- lation that authorized the ''1960's Sea-Level Study." The committee later authorized legislation to extend the life of the Atlantic-Pacific Commission beyond its initial term. Several important questions are of vital concern to the Chair, and these must be addressed by the distinguished witnesses who will appear. Is it good timing to authorize a study before we have the compre- hensive treaty implementing proposal of the administration? Is it good timing to move before we know more about the views of our new Panamanian ])artners on a sea-level canal? Need we expend millions of dollars to update a sea-level study when most of our preliminary data indicate such a sea-level project is not necessarj'? In the subcommittee's vital interest hearings last year, one witness called the sea-level idea "economic fantasy." All our witnesses at that time agreed that the present canal could ade- quately serve our needs until the year 2000. We must also ask whether it is judicious to move when there are presently so many uncertainties that relate to the traffic for a sea- level canal. I refer to the unknown disposition of Guatemalan oil pipeline, the so-called Mexican "dry canal," the Sohio California to Texas pipeline, and many others. Another question to be addressed is why the Congress should au- thorize this study before the Administration has submitted the treaty enabling legislation to the Congress. A study, in this form, seems to me to contravene the intent of the treaty. Whatever our preliminary views on the likelihood of a sea-level canal, or the benefits of an update, I trust there will a unanimity of opinion on one issue. I believe that we agree that there must be a thorough and comprehensive body of facts which positively show a sea-level canal to be advantageous before the billions that would be needed for such a project could even be expended. I also want to point out that these hearings are being held today to accommodate Senator Gravel, who will be out of the country next week. I would now like to defer to the very distinguished Chairman (Congressman IVIurphy from New York) if he should come in. He may have a statement, when he arrives. We will jDroceed at this time. I recognize the Senior Minority Member, the gentleman from Ken- tucky, Mr. Snyder. Mr. Snyder. Thank you, Mr. Chairman. I appreciate the opportunity to make some remarks. I, of course, am intrigued by the way we arc getting the proposal before us, as a Senate amendment to H.R. 8309, a bill that we sent to the Public Works Committee, and the Ways and INIeans Committee, dealing Avith Lock and Dam 26, and some" taxing of the barges on the inland waterways. 31 As the chairman, I am sure knows, the Committee on Public Works, on which I am privileetween $3 and $3.30. That is what is being paid now for the oil going through there. 40 So this study understated what that cost of transshipment would be, but for comparative purposes it is still accurate. What I asked Arthur D. Little to do was to compare a sea-level canal moving supertankers, rather than shipment around the Horn, which were $3.24, or bringing cargoes through the present Canal. We wanted to see what it would cost to move a 300,000 deadweight tanker through a sea-level canal, based upon the projections that were done by the Sea Level Canal Commission. Here is essentially what their study showed. Their computer run showed that taking a 265,000 deadweight ton, then you could move oil at $1.75, and with a 165,000 deadweight ton you could move it for $2.18, as opposed to a pipeline cost of $2.06 for Sohio to $2.78 for Northern Tier. This included a near doubling of the tolls through the sea level canal. If you compare this with the existing toll, with the existing ship- ment, you almost have a dollar difference. Now, for the amount of oil that is in Prudhoe Bay today, 10 bil- lion barrels, you are talking about a saving to industry and to the consumers of the United States, just on what we have found today, of $10 billion, were all to go through the sea-level canal, compared with the projected cost at this point in time of $5.3 billion for the construction of such a sea level canal. You can see that the economics are absolutely mind-boggling as to what the benefits would be to the American people were that to take place. The next chart shows what would be the savings were we to deal with natural gas. Moving back to the oil line, the blue line is existing discoveries. The red line is what we project moderately would be discovered through 5 years, and the white line is 5 to 10 years. So we are talking about what essentially will be, rather than a surplus in the west coast, of 500,000 barrels, with these additional discoveries, that surplus could run from 2,500,000 barrels to 4 million barrels surplus per day. We can't say grace over what we have now. Then add, on top of that, the gas requirement. We are now drilling into the lower Cook Inlet. If we were able to find natural gas there, the best way to get it out would be through an LNG facility. There is not an LNG tanker today that can go through the Panama Canal. Yet we are making contracts to bring LNG into the east coast of the United States, where we have a shortfall, and will be dependent upon the Algerians for that natural gas. Were they to stop delivery, we would have no way to bring LNG, except to take tankers from the Kenai area, and to bring them to the east coast of the United States. The study that was done back in 1970 looked at 30 possible sea- level canal sites, and narrowed it down to eight sites. The site that was eventually selected was route 10 in Panama. Now, the other sites Showed at least 100 percent difference in cost. So what we are talking about is not the political luxury of who we want to give our business to if we are to build a canal. What we are talking about is the American taxpayer. 41 The American taxpayer. What is going to be in his best interest? AVhat is going to be in his best interest is the cheapest cost we have in building a sea-level canal. The site that was selected was this site, which was 10 miles to the west of the present Canal. We may not like who runs the coun- tiy, but that is beside the point. If we can make an arrangement with whoever runs the country, to the benefit of the American consumer, or the American taxpayer, then, of course, we will benefit greatly. There has been no time in the last year that I have advocated spending any tax dollars on building the sea-level canal. If this thing does not make sense in the economic marketplace, then chuck it. And if you want to add an amendment onto this, that this $8 mil- lion that we are asking for to go out and get the facts to make an intelligent decision, if you want that money back, put it into law that there will be no Federal guarantees to any bonding until this money is paid back by the Sea-Level Canal Company that will build this facility. If you want to make that requirement, go ahead and do it. But at least spend the money to go out and find out what is in America's economic interest, since we use the canal for a third of its traffic, and it is the American consimier, and your constituents in Kentucky, and in your State and my State, that pay for this obsolete canal, which is not meeting our economic interests. This next slide shows a cross section of the earth at route 10. You will be getting some technical advice on that, but I will be happy to respond to questions at a later time. Let me speak to you briefly on what this next chart shows. It ad- dresses the defense argument. A nuclear task force, the carrier, and all the vessels that go with it cost about $20 billion. Well, to move that $20 billion instrument into place, if you had a crisis in Gibralter, would take 25 days. If you had a sea-level canal you could move that $20 billion instriunent into place in 15 days. It means that that economic tool of defense can be 10 days more efficient if you had the sea.-level canal than if not, and from Naval defense theory, the equivalent of that 10 days is the equiva- lent to having an additional nuclear aircraft carrier task force. The defense benefits, the foreign defense benefits of a sea-level canal are inestimable. You cannot put a price tag on it, because you do not know whether that 10 days would be the difference of nuclear holocaust in the world, whether showing the proper amount of force in the world would forestall a nuclear holocast. That is what is at stake. But I think the case should rest on eco- nomics, and those economics can only be determined by the study that I requested, and what the chairman of your full committee re- quests in the legislation that he put forward. I do not know who said it was "economic fantasy," but whoever said it was not aware of the data I have compiled. I hope if there is somebody who says it is economic fantasy, he will come before this committee and show me wrong, and if I am wrong, I will be happy to agree. But until you can get facts that contradict the Ai-thur D. Little study, and the projection on energy, I think what I have said must stand. 42 The timber industry tells me it is going to be cheaper to get timber from the west coast to the east coast in super vessels. With a sea-level canal, for once, the Jones Act is going to help to retool American maritime interests. We are going to have to redesign the American fleet in order to accommodate the neAv efficiencies that can take place. The jobs that will result, the amount of ore that will have to be mined, and the steel made, and the coal to come out of Kentucky to make that steel, to make those vessels that will now be super in size, so that we can have economic advantage to our consumers, is, I think, an economic plus. You will hear testimony by the laboring com- munity, the people that represent the laboring masses of this coun- ti-y, as to why this could be of benefit. And the dredging that will have to be accommodated. If someone says this is economic fantasy, then I would hope that that person would come forward and dispute the figures that we have laid down here, which are of benefit to the consumer, which are of benefit to the laboring man, and which, of course, are of great benefit to mak- ing us a maritime nation. The problems that we are going to have are, of course, expressed in statements such as: "Let us wait for the treaty." You have your criticism of the administration in this regard; I may have my own. I do not want to wait for the treaty. I do not think we need to wait for a whole host of legislation that is going to be wrought with a lot of debate, and filibustering on the House side and Senate side about how the present canal is going to be handled. You worry about the present canal somewhere else. Tjet us look at the economics of the future, and not the past. I would rather the Congress not fight about something that is obsolete. Appropriate the money to find out what your future needs are, and that may help us disentangle the situation that exists presently. Now, for those that say, "Well, how the heck can we go build a sea-level canal?" First off, let us not say ive are going to build a sea- level canal. I think it is the height of arrogance for us to look at another country and say that is in our economic interest, so let us go build it. That is like saying to Saudi Arabia, we need oil, so that is our oil. That is ridiculous. If it is in their economic interest to use it for a sea-level canal, we should go up to them and say we have a com- mercial deal that we think you cannot refuse. If it is a canal to be biiilt, and it is on Panamanian soil, or Xicaraguan soil, or Bolivian soil, you better believe that it is soing to be a Panamanian Canal, it is going to be a Nicaraguan Canal or Bolivian Canal, and anyone tht thinks it is going to be otherwise has not arrived into the 20th century. The other aspect of this now, since we have settled who is ffoing to own it politically, is: How are you going to do it commercinlly? It is no big deal. If this thing washes economically, we can build it with U.S. guarantees, and if the United States does not want to guarantee it, the Japanese would guarantee it, the Germans will guarantee it, and the Saudi Arabians would be happy to invest their money. They do not have an intelligent place to invest the billions that we are Sfivino- them, and this is the kind of an investment, in 43 mal estate, that is the only sizable hedge against inflation that an investor can have. If we are not smart enough to go ahead and invest our money, or provide the guarantees, so be it. That is a decision that Congress can make 3 or 4 yeare from now. But I would submit that once the facts are in as to what our enlightened self-interest is, you will see the Congress move forward to provide a connnercial guarantee on the sale of the bonds, not for all of the canal, but just for the amount that we are using, one-third of it. Then if the Japanese want to finance 10 per cent of it, because they are going to use 10 percent of it, let them finance it, and if the other countries want to help finance it, let them join, too. All I have to say is, this should rest on logic, and economic con- siderations, and not upon false emotions. I hope I have dispelled the point with respect to waiting on the treaty. We could save millions, even billions of dollars for the American people. My question is very simple. Why wait? If we could save that kind of money, we should be building this thing right now. The problems that are going to be faced are in this order of priority : First, the political problem. That challenges the political maturity of our Congress in getting the study moneys, and then using the study infoi-mation and then challenging the maturity of the Ameri- can people, and the people and the leadership of Panama, and the other nations involved. Two, would be the environmental question. People will oppose us environmentally. I think the question is one of tradeoff. It involves an ecological dislocation. I will not say it is environmental pollu- tion, because I will not admit that my presence on this plant is a pollution. I said it is an ecological displacement, over maybe some fish, or something else. So the tradeoff there is the ecological displacement that would take place to breach the continent where it is 50 miles. I think the minimum ecological displacement takes place obviously at the 50-mile-wide point. Speaking to the legislation that has been introduced in this com- mittee, the difference between it and the Senate version is not at all great. The biggest difference is in temis of mony. This committee is talking about authorizing $-3 million. I do not see how we could quibble over the difference between $3 million and $8 million. Taxpayers aside, we are talking about billions of dollars of sav- ings to the consumers of this counti-y, and to quibble over the fimds to acquire the information to make that decision, I think is penny- wise and pound-foolish. I have a letter that I would like to also include in the record from Arthur Anderson & Co. You are going to have the gentleman from Arthur Andersen testify. He talks in terms of an economic study that would be between '$1 million and $li/o million. Just the eco- nomic investigation would cost that much. The study that took place in 1970 was not strong in the economic area, and in your legislation you give even shorter shrift to economics. I am not saying minimize the environmental side. I am not say- ing minimize looking at where you should locate it. I am not saying 44 minimize the technical stuff to build it. Tlie difficult part is going to be environmental. The environmental portion will require $3 mil- lion to study, and 3 years to do it. Give it $3 million and 3 years, so at the end of 3 years, if the environmentalists dispute what you are trying to do, let them put their facts where their mouth is. That is the only way to handle that issue — by satisfying the informational needs that are there. The other is the time element. The House bill would require a 5-year period. If you listen to the bureaucrats, it is going to take 14 years to build it, and 5 years to study it. It is not going to take that long. You can have your choice of routes done in 6 months, you can have your economic study done in II/2 years, and you can have your environmental study done in 3 years. Why take 5 years when it can be done in 3 years? This is not going into the bowels of the Department of Transportation or the Corps of Engineers. These are going to be private studies, out of the private area. If they cannot shape up and deliver this data in 1 year's time, or li/^ years' time, or 3 years' time, then forget it. For- get it. They can study this thing for 10 years if you let them do it, but I would hope with the disciplines and the competitive influences would bring the facts out in less time. Every year that we delay making a decision and initiating con- struction, is eveiy year that the rate of obsolescence goes forward. Now, if we have gone from 10 to 50 |)ercent in 12 years, and we delay 5 years, just diddling around in the study, and making a deci- sion, then that obsolescence could double in that period of time, costing the consumer of this country considerable sums of money. I would hope that the committee would judge that the time ele- ment in question can be shortened, and that the money for this study should be the high figure that we came up with. And if later, after the facts are in, there is quarrel with the leadership of Panama, a quarrel over where it should go, that is the time to address yourself to that, not now. Now, we do not know. The only facts we have is what I have before you. What I have before you shows that on oil alone we can save almost $1 a barrel. "Wliat does it mean for coal? What does it mean for wheat? What does it mean for timber? For the general cost of living? "Wliat is the savings I do not know, and nobody else knows at this point in time, and it would be foolhardy not to go find out what is in the best interest of the people. So I thank you very much for your attention. Maybe I can respond to questions that you, Mr. Chairman, and Mr. Snyder might have, before introducing the balance of the people who have joined me as a panel. Mr. Metcalfe. Thank you very much. Senator Gravel. The Chair would state, with great enthusiasm, its recognition of the fact that you have been conscious of legislative iurisdiction, both of the full Committee on Merchant Marine and Fisheries, and the Subcommittee on Panama Canal. We appreciate your position. It coincides with ours. Now, if you would like to bring your panel to the table at this particular time. 45 Senator Gravel. David Dolgen, Richard Saul, Jolin Eddinger, and John Brown. Mr. Chairman, Dan Miindy could not be here, and I have a state- ment that I would like to be put in the record. I would like each person to introduce himself. They are have very, very short statements, and maybe they could put their statements in the record, and just state very briefly their policy statement. Mr. Metcalfe. Senator, your full statement in its entirety will be entered into the record, unless there is objection. Hearing none, it is so ordered. [The following was received for the record :] 46 Statement of Hon. Mike Gravel, a U.S. Senator From the State of Alaska Foreign policy always starts with the question, What United States interests need to be protected? And that is the beginning point for any discussion of the Panama Canal. There is no question that the United States has an interest in a canal at the Panamanian isthmus. But I have become convinced that our real interests lie less with the present canal than they do with the opportunity to construct a new, sea-level canal. I therefore joined with Senator Warren Magnuson in offering an amendment to the Navigation and Development Act (H.R.8309) to authorize a three-year study to update the report of the Atlantic- Pacific Interoceanic Canal Study Commission. The Senate accepted our amendment on May 4, 1978. The Canal Study Commission, appointed by President Johnson in 196U to study the feasibility of constructing a sea-level canal across the Central American isthmus, issued its final report in 1970. At that time it stated that a sea-level canal is wholly feasible from a physical point of view and under reasonable assumptions could be expected to pay for itself within 60 years. The Commission further determined that the defense and foreign policy benefits of a sea-level canal are sufficiently great to warrant writing off a substantial portion of costs for those purposes. In the eight years since the Commission issued its report it has become increasingly apparent that the present canal is rapidly obsolescing and that a sea-level canal would be not only of military and foreign policy significance, but also of great economic value. To fully appreciate this fact it is helpful to compare the economic projections made by the Commission with actual experience over the intervening years. The most frequently heard argument against the economic via- bility of a sea-level canal is that the actual number of ship transits of the present canal has fallen considerably short of the Commission's potential transit forecast. There can be no disputing the facts, although as I shall show momentarily, the interpretation placed upon them has been incorrect. In 19 70 there were approximately 15.5 thousand transits of the canal per year. The Commission pro- jected this figure would rise to 18.5 thousand by 1977. But in fact the number of transits declined to just over 13 thousand by 1977. (See Chart 1. ) 47 Page 2 0) '(0 c (0 (0 c O (0 E (0 c Q. \ \ \ \ \ 1 « \ \ ^\ Sn \ 1 < \ 1 %\ g qV s J ^ > / %V- •*J / « X %T^ S / t\ ^/ r ^v 1 (0 c o i (0 w 3 •i\ O \ c \ \ \ \ \ \ c (0 \ \ H ' \ / o \/ o JQ \ -v^ o 0> (0 Q r- © O s5 il. E (0 I S 1 a> ^ •a h E ZCsl O) 00 l/^SM(Ei »if6rMU' 90OWT y A ^DWT y < t 1 1 mb VT 1 1 1 1 1966 1968 1970 1972 1974 1976 1978 Year Source: Feamley 8- Egers Chartering Co., Ltd. 56 Declining Percent of World Fleet Able to Use Panama Canal 1966-2000^ Percent 100 ^89.59% of world r"*^ tor •-, ^ \ as mage at e Canal aie TO \ ^ a42.20% of world \^ tonnage able to X use Canal > \. y^ ton 4%ofv nage ab vorld le to ^^ use Canal 7. *^-v to t4%of nnage i use C world ibie ta- 'anal N \ 90 80 70 60 50 40 30 20 10 1966 1971 1976 1981 1986 1991 1996 2001 2006 Year * 1966-1977 actual figures from Fearnley & Egers Chartering Co., Ltd.. Projected figures assume vessel size growth rates equal to only one third actual rates for the past decade. 57 1 beliove it i:: .i conservative estimate that Alaska will be producing an additional two million barrels of oil per day within ? to 5 years, and yet another two million barrels per day within 5 to 10 years. (Sec Hap No. 1.) Figures of this magnitude are confirmed by an Atlantic Richfield Company estimate that the West Coast oil surplus could be as high as 2.4 million barrels per day in 1990. As these Alaskan oil reserves are brought to production, a sea- level canal becomes increasingly attractive. It would require 120 million tons of canal traffic per year to move a surplus of 2.4 million barrels per day through the canal. This represents almost exactly one-half of the Commission's entire potential tonnage forecast for 1990. They included in their 239 million tons per year estimate only 41 million tons of petroleum, or about one-third the volume that now appears likely to materialize from Alaska alone. If this oil and the accompanying gas is to reach U.S. markets where it is needed, it must be transported by tanker to the Gulf of Mexico and the East Coast, or else it must be moved inland by pipeline from the West Coast. The pipeline alternative has considerable drawbacks. The nation's pipeline infrastructure for the delivery of oil and gas runs south to north, fanning out from the Gulf Coast States to serve the Midwest and Northeast. (See Map No. 2.) The explanation for this pattern is simple. Historically, oil and gas was dis- covered in the Gulf region and was moved to the nation's population and industrial center. This infrastructure represents a $7 billion capital invest- ment in the case of oil lines and $12.7 billion for gas lines. There is also an investment of approximately $19 billion in Gulf Coast refining capacity. If it were to become necessary in the next several years to move our energy supplies from west to east, rather than from south to north, much of this infrastructure would have to be replaced at capital costs much higher than the original investment . For at lea'^t the next 2 to 3 years there is no real alternative to using the existing canal for transporting West Coast surplus oil to regions of the country which have a crude oil deficiency. But because of the inefficient lightering operations that are involved, transit charges on this route are sufficiently high that pipeline alternatives become attractive even though new pipeline investment costs would be required. A number of such projects have been proposed to deliver surplus oil to markets in either the Central or Gulf States. (See Table ] and Map 3.) The most important of these are as follows: 58 '■§ r-^.,^ m^ » ■1 / 59 I 32-461 O - 78 - 5 60 PROJECT Transport Costs by Capital Route Thruput Projected Investment (S/Bbl) (MB/D) Start-up (S R) Chicago Houston Trans-Guatemala 1200 Trans-Mountain 165 1/81 1/79 2.52 2.16 2.30 CO 0| H CO Eh _. MO '-"HO wl^t^ K tn ■jz u ^os t< w H U > n m Cm CO t^ in CO r^ ir» Cv4 00 fO o 00 f-t i-H • * (0 t-i r-4 4J o cd 4J >^ iJ o CO a o 09 o a « u H CO U vO lO f-l ►» O r^ CO Id ««g i-l o- r-t « U u (0 /I Wi )-l «d o 1 a M < o o o" o g •J •-I lO H ^ CO <§ 4J < U o i-H CM o _] z M 1 H § ^ ^ to CO CO 67 In addition, a sea-level canal could be transited by our air- craft carriers, which are too large for thr> present facility. At present, a Carrier Task Group moving from one ocean to the other must send p.irt of itr. force arounti South Americi while tho remainder t^.3rli;i1.^. Hir cjiidl, onJy to I'm idle for I'l d-iyn while the rest r>r the force catches up. As an example of the strategic shortcomings and military in- efficiency of the present canal, let us assume there is an emergency in the Mediterranean which calls for reinforcement from a Carrier Task Group stationed on the West Coast. Under present conditions, the Task Group's crusier and 15 of its destroyers would sail through the canal, reaching Gibraltar in 15 days. Meanwhile, the carrier and an additional 10 destroyer escort would steam the additional 5000 miles around Cape Horn, not reaching Gibraltar for 25 days. If a sea-level canal were available, the entire Carrier Task Group could reach Gibraltar in 15 days, at a savings of 47,000 barrels of fuel and $870,000. The strategic flexibility this would provide our Navy would be equivalent to adding an entire Carrier Task Group to our arsenal. In effect, this would provide us an additional $20 billion in defense capabilii y at no extra cost to the taxpayers. (See Map 4. ) Taken together, the military and foreign policy values, the savings from retaining existing energy delivery infrastructures, and the reduced transportation costs of a sea-level canal would appear to justify such a project even in the absence of strict financial feasibility, which, as we have seen, is far from lacking. The United States - perhaps in conjunction with other inter- ested parties such as the State of Alaska, the international oil companies, Japan, Mexico, Venezuela, and countries on the west coast of South America - could guarantee the bonds to finance a new sea-level canal fully owned and operated by the Panamanians. It would be strictly a business arrangement with a Panamanian guarantee of access and reasonable tariffs as the only quid pro quo. This would provide Panama the economic control over her resources she demands, and would at the same time defuse the present controversy. The United States, for her part, would obtain the economic advantages already pointed out, and would achieve her ultimate goal of a defen- sible canal available to all at reasonable rates. I think there can be no doubt that the advantages to the United States are sufficiently great to warrant the authorization of a further $8 million to update the comprehensive work already done by the Canal Study Commission. This update would include (1) a 68 i 69 review of the shipping study, including an updale of transportd t ion oconomica; {7) a review of potentia] environmental effects, including the preparation ot an environmental impact statement in accordance with section ]02 of the National Environmental Policy Act, with Tppcia] attention l>oinj; given to |)0tfntLal erolofrical effects of the migration of marine organisms through a sea-level canal; and (3) a review of the 1970 engineering findings and recommendations. / 70 TABOGUIUA ISLAND SEA-LEVEL CANAL ROUTE 1( 71 15 OO-- OL'ATEMALA t HONDURAS . \ ' \v>V^ NICARAGUA !■ EL ^ MANAMA- .rv |ALVADOR0 X . \ \ ^ 11^^ Qo) ^-r^-^ rt ^^ ., c<*7'' ^ INSERT "A" CANWBEA'^ ^'FA INSERT "A; SCALE IN MiLES SO _ SO 'M EL SAl-VADOK INTEROCEANIC CANAL ROUTE: FIGURE 2 (1W7 STUDY) 72 CHANNEL BOTTOM 20 DISTANCE MILES PROFILE riOAL CMtCKS ISINGLE LAnei JNITIAL CHANNEL - A -Jt-. TiDAt. CHFCu. f -4 ^^APPiT'O NQF BYPASS -q c -!^-._l h-- TtosecTross IDAl CMfCK P-L' exTENSIONOf BYPASS - C ROUTE 10 CHANNEL CONFIGURATIONS 73 74 Senator Gravel. And Dan Mundy's statement, I would also like to be placed in the record, and a letter from Arthur Andersen. Mr. Metcalfe. I will ask unanimous consent that all of those state- ments be entered into the record, unless there is some objection. Hearing none, they will be entered into the body of the record. [The following was received for the record :] Arthur Andersen & Co., Chicago, III., April 18, 1978. Hon. Senator Mike Gravel, U.S. Senate, The Capitol, Washington, D.C. Dear Senator Gravel : You requested that I set down in writing my thoughts on how to approach a financial feasibility study and an estimate of the cost for such a study. In response to this request I am setting forth in this letter my initial and tentative thoughts in this regard. I strongly urge that the canal feasibility study give major emphasis to finan- cial considerations. A canal serves a transportation market and the question of what type of canal to construct should be substantially influenced by the need for canal services represented by the willingness of users to pay prices for the use of the facility that will justify the enormous capital expenditure in- volved. Before engineering alternatives are considered, the financial analyst needs to conclude as to the type of the facility that will be most attractive to the user. The basic approach to a financial feasibility study would be comparable to a long range development plan taking into consideration all alternatives includ- ing a new facility. Although a sea-level canal is most attractive to you, I would recommend that the financial feasibility study consider all alternatives for im- proving canal service. These alternatives would include not only a sea-level canal but also modernization of the existing canal, construction of a third set of locks, and possibly other types of completely new facilities. As a result of comparing a full range of alternatives, it will be possible to select the most appropriate plan taking into account such noneconomic factors as potential political and social impact. The basic approach to the study would be similar to that adopted by you in your statement on "Sea-Level Canal Feasibility Study". In your statement you looked at the market for a new canal and evaluated various alternatives to it. Although your statement is broad in nature, the basic approach is sound and would be followed in a more detailed feasibility study. Such a study would in- clude the following major elements : 1. Potential market survey. 2. Analysis of transportation alternatives and related costs. 3. Alternative canal pricing strategies. 4. Alternative methods of financing capital requirements. The Panama Canal Company has made many traffic forecasts over the years, tlie most recent of which was completed by an outside economist in .January, 1978. Although these traffic forecasts would be useful to the financial feasi- bility study, they would require substantial expansion to make them relevant because the level of traffic of the existing facility is controlled by the limita- tions of the facility and the current prices that are charged for its use. If the facility were substantially different, it can be expected that the use would be different. Accordingly, a key input into the financial feasibility study should be a sub.stantial market survey that looks for the potential demand for canal service. A significant prol)lem to be dealt with in the market survey is the effect of previous decisions by potential canal users that would limit their future use of the canal. There is no question that a canal must be looked at over a long horizon. The diflSculty in doing so is the effect of previous long range deci- sions. To illustrate. Atlantic Richfield is in the process of constructing a piiie- line from California to Texas to transport approximately 500.000 barrels of Ala.skan oil a day. Their decision in this regard was undoubtedly impacted l)y the limitations of the existing canal. However, since they may .spend upwards of $500 mllion to construct this pipeline they will probably continue to use it 75 even if a new canal became available. The reason for this is that their (le<"i- slon will be based on marginal cost which would likely be higher for the new canal after the pipeline investment. It is important to realize that the market survey should attempt to inven- tory the absolute market for canal service. It should start with the assumption of free canal service and who would use it on that basis. This absolute total would be subjected to analysis based on alternative transportation costs which could identify the watersheds where traffic would be discouraged from using the canal because of toll levels. The fact that a potential user is constrained by previous investments should not exclude him from the absolute inventory of potential users for a future canal. The next phase of the study would be extensive cost analyses of the per- tinent transportation alternatives to transport goods within the market poten- tial of the canal. These analyses should consider all transportation modes that compete with canal service including ships too large to use the current canal, routes avoiding the canal, railroads and pipelines. These analyses should dem- onstrate the competitive advantage and disadvantage to the various potental users of the canal identified in the market survey and should set forth the revenue potential of a canal assuming the appropriate pricing strategy. The very difficult question of potential users that could develop depending on where they develop their resources must also be addressed in this phase of the study. For example, assuming the existence of say undeveloped iron ore deposits in multiple locations, an iron ore mine could be developed in a location either requiring or not requiring the use of the canal, depending on the availability of adequate canal service and the price charged therefore. After having examined the absolute market for canal service and having determined alternative transportation costs, the next phase of the financial feasibility study should explore various pricing strategies to maximize reve- nue. Approaches could be developed to commit potential users to canal service over the long term, limiting the risk involved in the investment in a canal as well as maximizing potential revenue. The final phase of the financial feasbility study should summarize the re- sults of the previous phases and review alternatives available to finance the construction project. The involvement of more than the United States in the financing of the project may be desirable both financially and politically to place the canal in the context of an international utility serving the world. It is, of course, very difficult to estimate the cost of such a study but I can give you a ballpark guess based on my previous experience. As you indicated, it is important that this undertaking be truly international in nature and that it not be simply a U.S. effort. In this regard, important input would be re- quired from the Republic of Panama, who would be the owner of the canal, and substantial involvement of firms in the Republic of Panama would increase the cost of performing the study. Also, from a purely technical standpoint, sub- stantial fact gathering and analysis will be requred to ensure the credibility and acceptability of the result. Finally, it is important that firms with un- questioned expertise and reputation be engaged to further enhance the study's credibility. Based on these considerations, my guess would be that a financial feasibility study extending over a period of two to three years would involve the expenditure of between .$1 million and .$1.5 million. It will probably be very difficult, however, to justify the substantial invest- ment in a new or modernized Panama Canal based purely on economic data now available. It will therefore probably be necessary to justify the project, at least in part, on noneconomic factors or unquantifiable economic factors. As you pointed out. a new canal facility will spur economic development not only in Panama but in other locations in the Western Hemisphere. A canal capable of handling large ships would spur the development of new ports to accommo- date the larger ships. Also, ship construction may be stimulated in that ships are currently being built based on the constraints of the existing Panama Canal. To some extent an investment in a canal should be looked upon by govern- ments in a manner similar to construction of bridges and highways. The con- struction of highways encourages economic development not only locally but also in the nation where it is constructed. The canal is similar to a bridge as part of a highway but in this case it is a bridge on one of the major sea high- ways of the world. Governments sometimes must make the initial investment to spur economic development in the world. 32-461 O - 78 - 6 76 If you have any questions regarding these preliminary observations or if you would like to discuss this matter at further length, please do not hesitate to contact me. Very truly yours, Leonard J. Kujawa. Statement of Daniel J. Mundy, Legislative Director of the Building and Construction Trades Department, AFIj-CIO Mr. Chairman : My name is Dan Mundy, Legislative Director of the Building and Construction Trades Department. AFL-CIO. I greatly appreciate this opportunity to present testimony on an issue of vital importance to the building tradesmen of this country. I would especially like to express our gratitude to you, Mr. Chairman, and to Senator Gravel who long ago recognized the need for the construction and operation of a sea-level canal between the Atlantic and Pacific Oceans. If the key question to be considered in these hearings is not so much whether to build a sea-level canal, but whether an update of the 1970 Sea-Level Study is needed, then lets all go home now. For it seems to me that we are dealing with a need so obvious as to make the question moot. A quick glance at the roller coaster ride our economy has experienced in the past 8 years should prove that the 1970 findings are grossly outdated. It is the canal's economic feasibiltiy today which underscores its importance to the building tradesmen of this country. We acknowledge the significance of such issues as environmental effects and financing of the sea-level canal. But we are particularly concerned with the economic and national defense issues. Certainly, the improvement of interoceanic transit is a vital consumer issue. And as consumers who have suffered from a five year depression in the con- struction industry, the building tradesmen of this country are acutely aware of the benefits gained from cost etficient transportation systems. Although some have, for various reasons, disparaged pipelines as a viable transportation alternative, we consder pipelines as a necessary complement to other transit systems. Indeed, pipelines have already proved their cost eflSciency and environmental safety. If the study of the canal's construction is a consumer issue then, it is also an employment issue for us. The construction industry is presently struggling out of a five year de- pression. And the severity of the depression has yet to be fully tempered, because the building trades continue to suffer unemployment that is double the national average. Our figures show that the jobless rate of building tradesmen is about 17 per- cent nationally. The construction industry, the largest industry in our nation, long has been the bellwether of our economy. Any study of the economic benefits of the canal must surely address the eventuality of domestic port expansion. Only two ports in the U. S. today are capable of handling supertankers. Construction of the sea-level canal will necessitate expansion of existing port facilities to deal with increased supertanker traflJc. And expansion means johs. The building tradesmen of this nation stand ready to build these needed facilities. We think an updated study of the sea-level canal is warranted. For we know that any perusal will show that construction of a sea-level canal is not only economically feasible, but absolutely necessary. Thank you. Senator Gravel. On my left, Mr. Chairman, is Mr. David Dolgen, the director of legislative activities, Maritime Trades Department, AFD-CIO. 77 Mr. Metcalfe. The other gentlemen have short statements, and if they want to speak extemporaneously, they may do so, and let the record show that their full statements will be printed in the i-ecord. Without objection, it will be so ordered. [The following was received for the record :] Statement of J. C. Turner, General President, International Union of Operating Engineers, AFL-CIO Mr. Chairman and Members of the Subcommittee on the Panama Canal of the House Merchant Marine and Fisheries Committee, let me express my ap- preciation for being given the opportunity of appearing before you today. My name is J. C. Turner and I am General President of the International Union of Operating Engineers, AFL-CIO representing over 420,000 OflScers and Members of our organization and we welcome the chance to express our views on the feasibility of a further study on whether a sea-level canal should be constructed. There can be no question as to the importance of the Panama Canal and the relationship it has to the interest of the United States and also the fact that the importance will never totally diminish. However, we feel that a new opportunity awaits our country in recognizing now the need to construct a new sea-level canal. The Canal Study Commis.sion was appointed by President Lyndon B. Johnson in 1964 to study the possibility of constructing a sea-level canal in the area of Central America. The practicality of crossing the Central America isthmus with a sea-level canal was reported favorably in its final version in 1970. The report stated tliat the feasibility of constructing a sea-level canal was wholly possible from a physical point of view and under reasonable conditions. With our advanced technology a canal could be constructed so that it could pay for itself within a period of sixty (60) years. The Commission also deter- mined that from an economic, a defense and a foreign policy position, the bene- fits derived from a sea-level canal would be of immense value to the United States. The Commission report although eight (8) years old was used as a basis for an amendment to the Navigation and Development Act sponsored by Sena- tors Magnuson and Gravel. In that amendment which recently passed the Senate, an authorization of eight (8) million dollars was allowed to establish an International Sea-Level Canal Study Commission. The new Commission would conduct studies and investigations to update the 1970 Report of the Atlantic-Pacific Interoceanic Canal Study Commission. The International Commission as proposed by Senators Magnuson and Gravel would consist of three (3) appointees of the United States and an additional three (3) appointees recommended by Panama. The report of the Commission which requires a study of the environmental effects, financing, economic feasibility and excavation techniques for a sea- level canal would be required to be submitted within three (3) years of the date of the provision's enactment. The International Union of Operating Engineers after reviewing the Senate amendment worlvcd very closely with Senator Gravel in having the amendment pass the Senate because we feel that growth in ship size will continue upward. This growth in ship size from World War II to date was unexpected, but was also economically advisable. Yet this significance of that growth in ship size points out why a sea-level canal is vitally needed and why a further study to construct one is necessary. The situation is even more dramatic if we look at our Naval fleet. Our need in time of crisis to move our Naval force from one ocean to the other would almost manadate that we move foreward with a study for a sea-level canal. We would also be remiss if we did not point out the size of oil bulk car- riers that today are too large to use the Panama Canal. In an energy starved nation, dependent upon oil as the main source of that energy, a sea-level canal would provide a means of moving oil economically in bulk form from Alaska and the West to our eastern industrial base. American oil to American factories. We sincerely request that your Subcommittee support the Senate amend- 78 ment and Chairman Murphy's proposals for updating the 1970 Report and again extend our thanks to you for being given the opportunity to present these views on the neee absolutely in her power? "Mr. Stevens. We would have to protect our canal; there is no question about that. "My reason for being in favor of putting the.se artificial works inland I have explained. It seemed clear to me that that was the safest way. In other words, if a man goes out in a blizzard his hands are safer in his pockets than they are outside." On March 10 another engineer testified. Mr. Lindon W. Bates, of New York. He took a different position from Mr. Stevens, as we see from pages 295 to 297 in the hearings : "MILITARY ASPECT OF END LOCKS "It is held to be the legitimate conclusion from the following analysis, that any and every canal here is vulnerable in so many ways that it is a serious mistake to sacrifice to a hypothetical military benefit which in reality does not exi.st, the highest commercial service of the waterway. "One variation of the minority plan would move the Ancon-Sosa terminal locks to Miraflores, and having moved the Pacific locks, the canal is judged safe when in the center of three lines of possible fire and when on the Atlantic side there is a huge stairea.se of three locks, making a target three-fifths of a mile long and 250 feet wide, in Gatun Hill, fronting the Caribbean and 3 miles from Limon Bay. "The Chief engineer testified as follows l>efore the Senate committee subse- quent to his letter of January 26, to the Commission : " 'I proposed al)0ut the same elevation — I thinlv I said 80 feet — for the high- level canal, as is proposed in the minority report, and I proposed putting my entire lockage system at the south of Pedro Miguel and Miraflores there to- gether, with this idea in view : That the locks at that point will be from 8I/2 to 9 miles — we will say 8 miles — in a straight line from the nearest point where a ship can lie. providing she reduced the fortifications in the outer harbor. In other words, she would come up the mouth of the canal and could lie there, i)ut she would have to throw a shell 8 or 9 miles before she could strike anything that .sihe could damage. •• 'The same condition prevails exactly on the north end, with the dams at Gatun. It is about 8 or 9 miles to where a hostile ship could lie, unless she came directly into the canal. She would not have anything to shoot at. My notion is that, with a small object like a lock lying at any unknown point — unless the enemy had al)Solute correct charts — a ship would have pretty hard work to do any damage at that distance.' "The supposition that "after the harbor fortifications were reduced" the war vessel would not enter the canal, but would lie off only "8 or 9 miles" and shoot fatuously into the jungle is surely interesting as a warrant for spending more millions than all Alaska cost to dig through the slime-covered morass and buried rock ridges to the lower Rio Grande Valley. The practically minded admiral or general who "reduces the harbor fortifications" of Limon or Panama bays will reflect that he does not then need to shoot at locks, but rather must hasten to save them from the defenders, as the Japanese tried to save the docks at Dalny. "Another proposal is to slew the Ancon-So.sa lock so that it is nearly at right angles to the line of the canal, making every ship passing through for all ages turn around to enter and leave. "It is time, certainly, to reflect. There are no mysteries in the science of military offensive. Every admiralty will know to a dot just where the locks are, and precisely their i-elation to the zones and angles of fire and to the principal modes of attack from the sea. There are four ways that locks can be disabled from the sea. "(1) By gun fire. 99 "Noting the progress of the past decade, the power of the present 12-inch and 16-inch guns, the constantly increasing range, the terrible accuracy de- veloped, and the certainty that range and accuracy \vill increase, it needs small prevision to register the certainty that the Sy^ extra miles from Mindi to Gatun or the 4 extra miles from Sosa to Miraflores offer no tangibly greater security at the latter places from a 12 or a 16-inch gun shooting 10 or more miles. "It is well to note that the Commission, including four members bearing in their titles the evidence of military training and one actively experienced in defending the siege of Viclvsburg. agree with both the Board and minority in not taking to the hills at Miraflores to "hide their locks." "(2) By dirigible balloons. "What does it matter to the new French dirigible dynamite air ships, one of which laterly circled over the defenders of the border forts of Germany, whether their objective lock is on the shore or a few miles from it? A hostile fleet, without "reducing the harbor fortifications," could send fifty such balloons over any part of the canal's 47 miles. "(3) By submai'ines, and torpedoes. "These constantly improving weapons of naval warfare, in daring hands, may be utilized. The locks most exposed are those of the minority at La Boca, be- cause attaclvs could be launched from a wider zone. The tide lock of the ma- jority is partially defended on the fianks by the low rock walls, which the latter suggest, parallel to the inner end of their approach. By far the best de- fense from this .sort of attaclv would be the breakwaters enclosing the harbor. These breakwaters would compel such attacks to run the close gauntlet of the channel between the i.slands and a boom across the entrance, while the other plans omit these, and their locks can not so well be defended by booms, nor can the energy be so easily discovered. "(4) By stone ships. "The Itreakwater likewise are evidently a better protection against these desperate ventures for blocking the channels than the meager provision of both the Board schemes. The breakwaters force such craft right between the point- blank cross fire of the island forts. "The true policy, militarj' as well as commercial, is to build the best canal that science can evolve for navigation, and hold this isthmian gateway of the western continents. Make it of such a nature that its risks are averaged over a number of easily repaired units, not concentrated, as in one huge dam or flight of locks. Make the breakwaters and the inner fresh harbors ; fortify the terminals and salient land points .so effectively that the United States can not be dispossessed. The millions proposed to l)e invested in making a worse canal by moving the locks inland will be better employed when dedicated to creating suital)le naval stations at each end and defenses that can not be reduced." One page 775 of the hearings we find the following section in the written statement to the committee by Gen. Henry L. Abbott, U.S. Army, on "Relative Merits of Sea-Level and Lock Projects :" "ATTEMPTS TO INTERRUPT TRANSITS "Fanciful speculations have been advanced tending to suggest dangers of this malicious character, but they seem to be wholly uncalled for. We stand pledged to open the route to the commerce of the world, and by adopting the policy of international agreement to its neutrality, so successful at Suez, all danger of the route becoming a battle ground will be eliminated. It is conceivable, how- ever, that in the event of the passage of a fleet in time of war the hostile na- tion might plot its interruption, and as a military engineer, whose duties have made him familiar with the u.se of modern high explosives. I have given thought to the relative dangers of such attempts as directed against the two project.s. "The most vulnerable points are not the locks and sluiceways, for these oc- cupy but little space and would certainly be guarded effectively. The danger would be at the points where a narrow waterway traverses a jungle, favoring the placing of a bag of dynamite where the ship must certainly pass, and where a man concealed in the undergrowth could lie in wait to fire the mine with a portable electrical igniter, little exposed to danger of detection by a patrol. Such places aliound on the long and narrow route of the sea-level proj- ect, but are rare and easily watched on the relatively broad lake route. The 100 conclusion is thus manifest that the former has much more to fear from such operations than the latter. Moreover, actual experience at Suez has not de- veloped any such hostile tendency." Mr. Speaker, it should be clear to all that the timid excuses of President Ford and Secretary Kissinger for surrendering the Canal Zone and the Panama Canal raise no new issues. The possible threats they pose are old hat. I sincerely hope and trust that the American people and the Congress will turn a deaf ear to such rationales as iniworthy of this land of the free and the home of the brave. Senator Gravel. And we will submit for the record the statement of the Joint Chiefs of Staff on the fact that General Brown felt that the sea-level canal was Mr. Snyder. Would you or Mr. Dolgen submit the facts upon which either you reached that conclusion, or the 1970 Commission reached that. Senator Gravel. We would be happy to delve into that, and sub- mit something for the record. Mr. Metcalfe. Let the record show that this body of material will be submitted, without objection. Mr. Snyder. Mr. Chairman, I have a series of questions that I am going to ask, but because of the time limits, I ask unanimous consent that we be permitted to submit them to him, and he can Mr. Metcalfe. Again, without objection, it will be so ordered. The subcommittee will now recess so we can go to vote, for 15 minutes. [Recess taken.] Mr. Metcalfe. The recess is over. The subcommittee will come to order, and the Chair recognizes the staff member of the majority. Mr. MoDGLiN. Senator, I just have Mr. Metcalfe. Let the record show that Mr. Terry Modglin is the staff member of the majority. Mr. Modglin. There are a number of questions which I would address if we had time. In the interest of time, I will just address one or two of them, sir. Mr. Metcalfe. All right. Proceed, please. Mr. Modglin. In correspondence with some private parties, in 1977, the Corps of Engineers estimated, Senator, that the update of the study of Route 10, as designated by the 1970 Commission, would cost approximately $7 million, including onsite surveys. Does your proposal. Senator, in your amendment, envision simply an update of the study on Route 10, or would it go beyond that? Senator Gravel. It would only go beyond that to the point of satisfying that Route 10 is the route to be selected, and then it would move quickly into the environmental work, the economic work and the engineering work. Mr. Modglin. Thank you, sir. One other question. Senator: What is the largest tanker, in terms of deadweight tonnage, that the Port of Valdez can handle at the pre.sent time? Senator Gravel. The Port of Valdez is the only super port in the Northern Hemisphere that is in operation. It could handle a 700.000 deadweight tonner. It is just one big saucer, so it can handle what- ever can float in there. There is really no limitation to it, truthfully. The large.st tanker built in the world is 700,000 deadweight tons. 101 and that goes very few places in the world. We could handle it in Valdez. IVIr. MoDGLiN. Do you know the largest size the east coast ports can handle? Senator Gravel. Right now, we can handle a 250,000 deadweight tonner in Long Island, There is one facility that is not generally known. It is owned by Northvillo Industries. They have a facility there. They are the same people that own the terminal down at Panama for the Alaskan oil. That is the only one. So you would have to build sea-level — you would have to build super tanker ports in the gulf coast. Louisiana, as you know, is building one. Galveston is working on one, and Houston is working on one, Sea Dock, which has been revived by the State of Texas itself. So there will be one in operation in Louisiana ; there is one avail- able in Long Island; there would have to be some built in the Vir- ginia area, Chesapeake Bay and New Jersey area. There are none now that I know of. Mr. MoDGLiN. One last question, Mr. Chairman. I wonder what your estimation is. Senator, of the duration of time that Alaskan oil will serve a significant portion of the Nation's energy needs, and would a sea-level canal be able to be constructed in time, while the major flow of that oil continues? Senator Gravel. First off, how long it will last, only God knows. The pipeline was financed — ^the oil pipeline was financed on the basis of 20 years. The oil is expected to flow around 30 to 40 years, in that area. The gasoline, that is coming out there, is going to be financed simi- larly, with a 5-year delay. Right now, production will take eight years to bring on line. So the lead times are very significant, I would project three — if we had a 3-year study, and made a decision in the third year, that you would — could take anywhere from 3 to 5 years. You could have a sea- level canal in operation by 1987, 1988, which means that if you had discoveries taking place next year and the year after, they would be coming on the line at the same time. So the timing could be absolutely, just very harmonious. Mr. INIoDOLTN. Thank you very much. Senator Gravel. I did not state it very clearly before, and you bring it to my mind. If the United States or the world made a decision to go ahead with tlie sea-level canal in 1981, you would have an unbelievable ripple effect. I went to Japan and I briefed the Prime INIinister, and he immediately saw the significance of it because Japan is the No. 1 maritime nation in the world. They estimate that the entire maritime fleet of the world would redesign itself. So a decision to go with the sea-level canal means that everybody is going to start making decisions and buildins; new and different kinds of vessels. That is an economic impact. That is why the vari- ous maritime trades are interested. But even more economic impact will come in the ports of the world. Major ports are going to have to redesign themselves. The Port of Valdez was built by the Japanese, and they know that this is big business. This is a lot more business than just building a 102 vessel. And so the amount of economic activity, to rebuild all major ports of the world, will be significant. Then of course the dredging that would have to be done, in all of the areas, to meet the new and larger and more efficient sized vessels — so the ripple effect of this economic activity would be the most sig- nificant occurrence of the 1980's. Mr. Metcalfe. Senator, I have one question I would like to ask. With the building of these large tankers, those which cannot transit the Panama Canal now, would they be able to go through the Suez Canal? What is going to happen to the Suez Canal? Senator Gravel. Yes. In 1981, they will be able to go through the Suez Canal. Mr. Metcalfe. Thank you very much. The Chair recognizes the counsel for the minority. Mr. Nonnenmacher. Senator, to followup Mr. Snyder's question, I would like to ask two or three on this matter of private financing. I must admit it came as a surprise to me — I did not gather that from your statement. I imagine that where you alluded to it is on page 22. You say that the United States, perhaps, in conjunction with other interested parties, "could guarantee the bonds to finance a new sea-level canal, fully owned and operated by the Panamanians. It would be strictly a business arrangement with a Panamanian guarantee of access and reasonable traiffs as the only quid pro quo." Would you expand on that. Senator, as to where the private invests- ment would come in in actually constructing this canal, or in invest- ing in it in the first place? Senator Gravel. Well, first off, if you have a guarantee, you are not appropriating any money. You are just making yourself liable for it. So if you are dealing with simple guarantees Supposing the canal cost $10 billion, and the United States traffic indicates that we used it for a third. So that means that $3 billion of that $10 billion capital investment is really going to benefit us. So what we could do is: We could say we will guarantee $3 billion worth of Panama Canal bonds, and that the money has to be used for the canal, and that it has to have a certain tariff for American inter- ests, tied to an inflater and escalator. And that is it. For perpetuity, it will be tied to inflation, plus this specific tariff. Now, you could either have bonds that never pay themselves off, or you could have 10-year bonds or 20-year bonds. There are just various ways of doing it. So you would sell those bonds on Wall Street, or you would sell them in Saudi Arabia, or in Paris or in London, or you could sell them in Tokyo. You could sell them anywhere anybody wants to buy some bonds. They would be very desirable bonds, from an investment point of view. Very, very desirable because of the guarantee. But even without the guarantee, they would be desirable. Most people lose sight of the fact that the Suez Canal — the reason why de Lesseps was able to raise the unbelievable sum of money for the misbegotten adventure in Panama, was because a lot of people made a lot of money off of that. That was a private endeavor. Mr. Nonnenmacher. My question still is not answered. Who would get the money that would be raised by the issuance of the bonds ? Senator Gravel. Oh, the company that would be building the canal. 103 Mr. NoNNENMACiiER. Now, woiild tliis be, in your mind, some con- sortium of existing contracting companies? Senator Gravel. No question. Mr. NoNNENMACiiER, Would they be American, or would they be Panamanian ? Senator Gravel. There is no Panamanian company that could build this. Mr. NoNNENMACHER. That is why I was trying to get a little more complete statement from you, since you only mentioned guar- anteeing bonds to finance a new sea-level canal, fully owned and operated by the Panamanians. You said nothing about the bonds, financing from the bonds, going to the builders of the canal. That is what I wanted to get on the record. Senator Gravel. Let me give you a scenario. This is what I recom- mended to General Torrijos. I am very fond of defusing the owner- ship of wealth, and I have got legislation to try to do this in Alaska. What I recommended to General Torrijos was that he set up a Panamanian corporation that would own the sea-level canal. He would take the stock of the corporation, and he would issue it to every single citizen of Panama. And then the board of directors of the corporation would be made up of foreign nationals who guaran- teed financing, so that we would have a seat on the board of directors of the new Panama Canal. If Japan guaranteed some bonds, let us say, 10 percent of the bonds — or a billion dollars — they would have a seat on the Panama Co. The executive director and the president of that Panama Co. would be Panamanians. Now, that canal corporation, that Panama corporation, would then contract with anybody to build it. And undoubtedly, if it is par for the course, it would be Bechtel, Flour, or maybe a German outfit, or maybe Mitsibishi. Big multinationals would be the ones to build it. They are the technicians. Mr. NoNNENMACiiER. What collateral would the United States hold on behalf of the taxpayers for its share, which we would be underwriting, under a guarantee? Senator Gravel. Well, the guarantee Mr. Nonnenmacher. Acknowledging that the money is to be paid back, in the meantime there is always the problem of default. Senator Gravel. Default in this case is already taken care of in the neutrality treaty. It means that you make sure the vessels are in there, to pay their tolls, so you can pay the bonds. So the neutrality treaty is really what makes the thing. Not the guarantees, you see. We have already guaranteed. We do not have to have the United States guarantee the bond, nor Japan. You can sell the bond. You have a higher rate of interest without the guarantee, that is all. Your tolls would be higher, to amortize that, but in the act, in the treaty, we have signed with Panama, for per- petuity, we have in writing the right to go in and keep the Panama Canal open, whether it is the present canal or a sea-level canal. So if you guarantee that you keep it open, then vessels that come through are- going to pay their tolls. Mr. Nonnenmacher. Excuse me for interrupting. I did not phrase the question properly. I meant by default, the inability, for what- 104 ever reason, let us say, of the builders, the private companies, to complete the canal. So there is nothing to defend. It is just a big, half completed ditch. How does the United States taxpayer get his money back? What is the collateral? Is it just an uncompleted ditcli in a foreign country, which we cannot repossess? Senator Gravel. No. No. You would have parts in the contract where you would have completion clauses, if there is a default, that you could go in and complete the project. That is not a big deal. I mean, you are talking about contract language. That is done all the time. Mr. NoNNENMACHER. If what you have just said, if that were to happen, would not the completion of the deal undoubtedly be at the full cost of the taxpayer? Senator Gravel. No, no. No. What you do — see, the whole thing rests on economics. If the thing can pay for itself, I will do it, you know. Keep the Government out of it. Hell, private companies make a lot of money, like de Lesseps did. So that is not the point. Mr. NoNNENMACHER. We have no objection to that, but you made the point in answer to Congressman Snyder that this was not goin^ to be built with appropriations. But when you get down to guaran- tees, all we have got is the same situation, do we not? Senator Gravel. Well, here is what you could do. When the study is in, you could fight the guarantee, be against the guarantee. Mr. NoNNENMACHER. That raises another question which I was going to ask you: That is, why are we even involved here in this subcommittee, with a certain small expense to the taxpayers, in this hearing considering the $8 million study, if this is such an attractive multimillion dollar enterprise for free industry? And, if it is so attractive, why are you projecting all of this on the basis of guar- antee? Senator Gravel. On the basis of guarantee. But I do not know the results of the study. I think I know, but I do not know. Mr. NoNNENMACHER. No. I mean attractive because of Alaskan oil. You are quite convinced that Alaskan oil will flow for 40 or 50 years. I am inclined to think that, myself, but it does raise a question as to the need for a Government appropriation for an $8 million study, or 3 million — as Mr. Murphy, I believe, is recommending. Senator Gravel. Well, do you not think Mr. NoNNENMACHER. Is it uecessary that the U.S. Congress dis- cuss the need for appropriating $3 to $8 million, if this canal pro- posal clearly is so financially profitable? After all, the Alaskan Pipeline was built at a much greater cost, by private enterprise. Senator Gravel. Well, if you do not think it is meaningful to save the consumers of this country billions of dollars, then you are right. You do not need the study. Mr. NoNNENMACHER. That is not my point. Why cannot private corporations spend $8 million — a paltry sum in view of 40 years potential of Alaskan oil that needs transporting? Senator Gravel. Boy, I do not laiow. Why do we not have private corporations taking over all the roads in the country, and charge tolls? You know, the Government does it. The Government got into 105 the road business, you know. Why does somebody not do it ? Tt li:is not been done. I happen to be the only person who is pushing it. I happen to be the U.S. Senator, so I can push it effectively with the President, with this Committee, with the Senate. That is how things get done. If I stop pushing, nothing may happen. Mr. NoNNENMACHER. But liavc you tried to push some private corporation or group of corporations into funding an $8 million study ? Senator Gravel. No. No, because it is obviously a canal of an inter- national nature, like this, involving the U.S. Government and the government of Panama, obviously a governmental thing. I mean, a private company, to go out and spend $8 million on this, would be defrauding its stockholders, right now. Mr. NoNNENMACHER. Maybe we would be defrauding the tax- payers. Senator Gravel. No. No. There is a private sector and public sector. At this point, it is in the public sector. You need a treaty to bring this about. So somebody ought to go out and form a stock company, raise $8 million to go make a study Mr. NoNNENMACHER. Senator, you are contradicting yourself. Here you spoke of de Lesseps and Suez, and a lot of people making money out of that investment. If this highly profitable canal is to be totally owned and operated by Panama, there are certainly no reasons why the United States has to get into the act. It seems to me that some American de Lesseps could sell private American citizens, and per- haps foreign citizens, on investing in a company to build a sea-level canal for Senator Gravel. I would recommend that you recommend that course of action to Mr. Snyder, if you think that is available. Mr. NoNNENMACHER. I havc only one last question. It again re- turns to the question that Chairman Murphy brought up. It was the last point made in Mr. Snyder's opening remarks, the second of his two key questions. Would you please submit for the record in some detail an answer to this last question. You have taken care of answering the first, namely, how long can Alaskan oil fields be expected to produce profitably ? But to what extent will there l^e a need for either pipelines or canals to carry Alaskan oil, if import trade-offs are made with Japan, and perhaps other countries ? Senator Gravel. I will put Mr. NoNNENMACHER. It is my understanding that there will be no need for pipelines or canals, because the swap would take care of all the oil produced in the next 40 to 50 years. Is that right? Senator Gravel. Who says that ? Mr. NoNNENMACHER. It is an understanding that I have gathered from certain sources in the petroleum field. But this is why I am asking you. It may be an erroneous assumption. Senator Gra\t:l. Let me give you some information, then. I have been advocating the export of oil to Japan. I am still advocating 106 this. You at least have to give me credit that I am not an idiot. We do not know what the discoveries will be, but we know it can be — minimally, it will be somewhere around 5 million barrels a day. Now, the Japanese market will not take all of that, and we do not know what elements they will take. All we know is that we have a lot of oil, and that right now Congress is predisposed to not let one drop be exported. I think that Mr. Murphy has made his views clear. I do not agree with those views. I do not see anything wrong with exporting. But I also see benehts to lowering the barrier. It may beneht us, it may benefit somebody else. It is just something worth doing. Mr. NoNNENMACHER. Well, Senator, you certainly have been well prepared. We appreciate your testimony. Mr. Metcalfe. Thank you, Mr. Nonnenmacher. I ask unanimous consent that all questions be submitted within 5 days. [The following was submitted for the record :] Questions of the Hon. Ralph H. Metcalfe fob Senator Mike Gbavel 1. Does your proposal presuppose that any new sea-level canal would be built in Panama? 2. There is some uncertainty in your proposal as to who will chair the In- ternational Commission. Would it not be easier to designate in the legislation who will chair the Commission? 3. Is it correct that in your proposal the Commission could not carry on its work until all members, including the Panamanians, had been appointed? 4. Could you elaborate on that provision in your amendment which authorizes the International Commission "to transfer funds to Federal agencies and to agencies of the government of the Republic of Panama"? 5. In recent decades about 5 percent of the world's merchant traflSc has tran- sited the Canal each year. Theoretically, if 95 percent of the world's fleet had been too big to transit the Canal many years ago, the Canal would still have done well financially. Of course, as a practical matter, vessels of previous decades could not be constructed in the magnitude they are today. Isn't the more relevant figure to determine the obsolescence of the Canal not the number of vessels in the world fleet too large to transit the Canal, but rather the number of those vessels which are too large to transit the Canal and which are carrying cargo that previously went through the Canal? 6. What evidence do we have of any interest on the part of either the state of Alaska or the countries mentioned in your statement as to their participation in financing a sea-level canal? 7. Exclusive of the new economic factor of the flow of oil and gas from Alaska, would recent economic changes make an update of the 1970 Atlantic- Pacific Commission meritorious? 8. If the SOHIO pipeline from Midland, Texas to Redlands, California were constructed, or the Guatamalan pipeline, would there remain enough surplus Alaskan oil and gas to make a sea-level canal financially viable? 9. If an oil swap with Japan for Alaskan oil were arranged, would that not vitiate the economic rationale as you have presented it for a new sea level canal? 10. The conclusions of the Atlantic-Pacific Commission are based on the as- sumption of a sea-level payment to Panama of 44 cents per ton. The recently- approved treaties provide a payment of 30 cents per Panama Canal ton to Pana- ma as well as a fixed annuity and a contingent one. The 30 cents per ton will increase with the wholesale price index. Therefore, won't this treaty provision mean that the royalties needed by Panama for a sea-level canal would have to outweigh benefits from recently approved treaty relationship, and that the royalties would have to exceed 44 cents? 107 11. Wouldn't Panama have a monopoly position if Panama had a sea-level canal and the present canal? Wouldn't it be better to build a new canal in another country to create economic competition between routes? On October 14, 1977, before the Senate Foreign Relations Committee, former Secretary of State Kissinger said : "These treaties establish for any possible sealevel canal the same rules and the same standards of neutrality that would apply to the existing canal and they give priority to Panama in the establishment of a sea-level canal. "From the point of view of the rules they establish for the sea-level canal they are definitely an advantage. I, myself, have raised the question whether it is wise to place two canals in the same country — we have enough problems with one of them there — and whether it might not be better to have a sea-level canal, if we build it, in some other country." 12. It was often said in the 1960's that the chief reason for constructing a sea-level canal study was to better treaty relations with Panama, and that absent treaty involvements there is inadequate justification for a new canal. The Wall Street Journal, on December 1, 1970, declared that John Sheffey, the Executive Director of the Atlantic-Pacific Interoceanic Canal Study Com- mission made it clear at a news conference that a major purpose of building a new canal is achievement of "excellent treaty relationships" between the U.S. and Panama, ending the recurring disputes over canal operation and sovereignty. "If we don't get those," he said, "then there's no justification for doing it." On economic grounds alone, he added, "the justification for a new canal is quite weak." Now that we have a new treaty relationship with Panama without a mandate for a sea-level canal, doesn't that dispose of the chief rationale for a new canal? 13. What is the rationale for the appointment by the House and Senate of the Commission members contemplated in your proposal? 14. Do you think the creation of the International Commission as it is con- templated in your amendment would contravene the spirit of the 1977 Treaty in that the Commission would be primarily a creature of U.S. law? Do you not think that there ought to be a diplomatic exchange of notes with Panama, before the establishment of the Commission, to ensure that Panama re- gards its participation in the sea-level study as fulfilling its obligations under paragraph 1 of Axticle XII of the Treaty? Answers Submitted by Senator Mike Gravel to Questions Posed by the Honorable Ralph H. Mettcalfe 1. No, my proposal does not presuppose that any new sea-level canal would be built in Panama. Based upon the evidence now available, it is my judgment that Panama is the most economic place to build it, but my legislation in no way prejudges that issue. 2. I do not think it desirable to designate in the legislation itself who would be chairman of the Commission. I am persuaded that the effectiveness of any commission is in direct proportion to the degree to which members of the com- mission share in full participation. Selecting their own chairman is certainly an important part of such participation, and I can see no off.setting gains in denying it. 3. Yes, it is correct that the Conunission would not be functional until all mem- bers are appointed. I take this to be true of all commissions. 4. The provision in my legislation to allow the Commission "to transfer funds to Federal agencies and to agencies of the Government of the Republic of Pan- ama" is included to allow the Commission to obtain, if needed, expert assistance from appropriate governmental agencies on a reimburseable basis. I see no rea- son why the Commission should either be denied appropriate assistance from the respective governments, nor be able to commandeer such assistance free of charge. .''). I feel that this (inestion somewhat misses the point. There is no reason that in makinti a decision about the economic feasibility and desirability of a sea- level canal that we should limit ourselves to an examination of past .shipping patterns. These will certainly be of interest to the degree that they allow us to project future commodity movements. But more important will be an analysis of what commodity movements could be expected if we had a sea-level canal. His- torical patterns are important only as they contribute to the answer to this 32-461 O - 78 - 1 108 larger question. Such patterns in themselves are by no means exhaustive of what we may expect. The ob.solescence of the present canal must be measured in terms of what traffic patterns could be expected if the physical barrier of the isthmus were to be breached by a sea-level canal capable of handling vessels of a given size. 6. No country or no State has at this point stated unequivocally that it would participate in the financing of a sea-level canal. It would, of course, be inappro- priate for them to do so until sucli time as the study I have proposed is completed. However, I have had conversations with governmental leaders of Japan, Vene- zuela, Mexico, Brazil and the United States, and they have expressed their keen interest in possible participatory financing of a new canal. 7. Yes. My formal statement to the Committee addresses this question at length. 8. First, let me reiterate that I do not regard the financial viability of a sea- level canal as resting wholly upon Alaskan oil. I have merely used Alaskan oil as one example (the one on which information is at present most readily avail- able) of why a sea-level canal would seem to be financially viable. Tlie study I propose would also need to examine in depth such possible commodity move- ments as Venezuelan oil, grain, coal, timber, minerals, etc. That said, however, I would add that the so-called Alaskan oil surplus on the West Coast would not be eliminated by construction of either the Sohio or Guatemalan line. At present the West Coast surplus is approximately 700,000 barrels per day. Atlantic Rich- field estimates that by 1990 the surplus could be as high as 2.4 million barrels per day. The proposed capacities of the Guatemalan and Sohio lines are, re- spectively, 1.2 million barrels per day and one million barrels per day (if both Phase I and Phase II of the Sohio proposal are assumed) . 9. Here, I would mention again the caveat at the beginning of my answer to question 8 : I do not regard the financial viability of a sea-level canal as depend- ent solely upon Alaskan oil. Whether or not a swap with Japan for Alaskan oil would completely solve the West Coast surplus problem is unknown. It de- pends first upon how much of the Japanese oil could be replaced with Alaskan crude. Certainly not all of it could be, as Alaskan crude is not appropriate for certain uses made of present Japanese imports. For instance, Alaskan crude could never replace Indonesian light crude. The degree to which swaps could solve the surplus problem is also dependent upon the level of future Alaskan dis- coveries and the production of Venezuelan discoveries. These are precisely the kinds of questions the study should address. 10. I find this question somewhat confusing because the facts as it presents them would appear to be incorrect. It is stated that the Atlantic-Pacific Inter- oceanic Canal Study Commission assumed a sea-level canal payment to Panama of 44 cents per ton. This is incorrect. On page 92 of tlie Commission's report, it is stated that the assumption was 22 cents per ton. Nonetlieless, I believe this error does not affect the correctness of the question's assumption that the royal- ties (or earnings) required by Panama for a sea-level canal would have to exceed the earnings they would obtain from the present canal. Otherwise there would be no incentive for them, or presumably for anyone, to build a new canal. It should be remembered, however, that just as earnings from the present canal will be affected by infiation, so will the potential earnings of a sea-level canal. 11. I think it makes no sense to talk of creating competition with Panama by building a sea-level canal in some other country. If a sea-level canal is financially viable, then in reality it will have no competition, regardless of where it is con- structed. It will be so much more eflicient than the present lock canal both in terms of transit time and size of vessels able to use it, that the present canal could not hope to compete. Moreover, the decision as to where to build a new canal should be based upon the cost of construction. The lower the cost, the lower the tolls will be since there will be less expense to amortize. We can assure our- .selves reasonable tolls by contractual provisions in agreement to provide financial guarantees for construction of the canal. 12. The new treaty relationship by no means disposes of the main rationale for a new canal. If it is justifiable, it is justifiable on economic grounds. Jolin Sheffey's remarks in 1970 were based upon his perceptions at the time. They in no sense control today, eight years later, regardless of their accuracy at the time they were made. 13. House and Senate members should be appointed to the Commission because any future decision concerning construction of a sea-level canal will depend upon the Congress. 109 14. I do not think the creation of the Commission as contemplated in my legis- lation would in any way contravene the spirit of the 1977 Panama Canal Treaty. The treaty calls for a joint stndy, as does my legislation. One country or the other must initiate the process. Since the United States is by far the wealthier nation, and consequently will bear the larger share of the cost of the study, it is wholly appropriate that we should take the lead. While I certainly see no objection to an exchange of notes between the two countries, it seems to me that the appointment of its respective members to the Commission by both countries would constitute recognition that the obligations of each under Article XII of the Treaty were being fulfilled. Questions ok Mk. Sxyder for Senator Gravel 1. Would you favor building a sea-level canal in a country other than Panama if that country were to make the project much more attractive financially than Route 10 by offering to Iielp underwrite it? 2. Tell us precisely how you arrived at your "reasonable toll figure" of 44^ per barrel of oil on page 18 of your prepared statement. 3. What is the likelihood of tlie Federal Power Commission and the Cali- fornia agencies involved refusing entirely to (1) OK the SOHIO pipeline across California, and (2) OK converting the present gas line that would tie into it to oil? 4. Senator Jesse Helms in his April 5, 1978, speech quoted a paragraph from the 1975 Study of the Organization for Economic Cooperation and Devel- opment entitled "Maritime Transport, 1975, A Study by the Maritime Transport Committee". That paragraph read as follows : "The average size of various vessel types existing and on order is given on page 70. It is notable that the average size of vessels on order has declined steadily over the last three years for all three types of bulk carrier, with the lack of new orders for the largest size categories and the growing interest in product tankers and bulk carriers that can transit the Panama Canal." Senator Helms commented : "That does not sound like any deathknell or obsolescence is indicated, does it?" Inasmuch as the OECD observation differs from your own projections, would you care to comment on it? 5. What year do you foresee as the saturation point for traffic through the existing Panama Canal? 6. On pages 18 through 21 of your prepared statement, you cite figures and submit a chart and table to demonstrate that transporting oil through the sea level canal would be the cheaiiest mode. You use figures for vessels ranging from 165,000 dwt. to 265,000 dwt. From your chart 9 on page 20, I calculate that it would take a vessel of approximately 190,000 dwt. to get the price down to the equal of SOHIO's pipeline cost of $2.06 a barrel. Testimony before the Commttiee by Lt. Gen. Welborn G. Dolvin of the Department of Defense was to this effect. He stated : "* * * The proposed sea- level canal would be 550 feet wide and have a minimum depth of 75 feet. A depth of 85 feet would be available along the centerline of the canal. The land cut would be 36 miles long and the sea approaches would be 17 miles long. The canal is designed to accommodate vessels up to 150,000 dwt. However, vessels up to 250,000 dwt. could transit under controlled conditions." The figures you utilized are all for vessels above the 150,000 dwt. which General Dolvin said the sea-level canal would accomjnodate under normal conditions. All three categories for which you give figures, therefore, must be transited under "controlled conditions". The third category which you cite, namely 265,000 dwt. vessels, according to General Dolvin evidently could not transit the sea-level canal at all imder any conditions since he cites 250,000 dwt. as the maximum. I would appreciate your comments on this matter. 7. Please submit for the Subcommittee more detailed data on each of the U. S. ports you mentioned as being able to receive supertankers today. 8. In your testimony you mentioneeech. Senator Jesse Helms suggested that data developed by the Organization for Economic Cooperation and Development (OECD) in its report entitletl Maritime Transport, 1975 contradicts my own projections concerning the growing obsolescence of the Panama Canal. This conclusion is based on a misunderstanding of either the OECD or my own data. Specifically, the OECD data to which Senator Helms refers is represented in tabular form as follows : AVERAGE SIZE OF SHIPS ON ORDER I In deadweight tons] January 1974 January 1975 January 1976 Tankers._ 171,400 163,300 149,500 Combination carriers 137,800 129,200 117,700 Dry bull< carriers __ 44,400 43,700 41,200 This data is fully in accord with my own. First, I would point out that the average size of tankers and combination carriers on order between 1974 and 1976, while they decrease, still remain considerably above the 60,000 dead weight tons (DWT) size which the present Panama Canal can accommodate. Moreover, it is to be expected that the average size of vessels on order will vary from time to time, without affecting the general direction of the trend toward vessels too large for the canal. At present there is lessened demand for very large ships in the world fleet because we have just passd through a period of rapid construction of such super vessels. This creates a need for smaller, shorter-distance ships, which is reflected in the OECD figures. In all probability, within a few years average ship size on order will again increase. But even if it should not do so, my data is in no way called into question. I would refer you to Chart 8 on page 11 of my prepared statement, from which you can see that my projection that the Panama Canal will be 90 percent obsolete by the year 2000 is based upon a vessel size growth rate equal to only one-third actual rates for the past decade. Even more importantly, I would call your attention to the fact that my calculations are based upon the in- creasing percentage of world tonnage which cannot use the canal, not the num- ber of ships or their average size. Thus, even for bulk carriers, which we can see from the OECD data are on average being ordered at sizes capable of transiting the canal, a growing per cent, by tonnage, eannot transit the canal. As can be seen from Chart 4 on page 6 of my prepared statement, in 1975 only 19.6 per cent of all bulk carriers were too large for the canal. Therefore it is clear that the average bulk carrier coidd transit the canal. But this 19.6 per- cent by number of vessels represented fully 43.8 percent of the tonnage or carrying capacity of bulk carriers. This is the important figure for measuring obsolescence of the canal. (5) I have never particularly addressed myself to the question of when the present canal will reach saturation, in the sense of capacity in number of transits for vessels small enough to transit the canal. I am therefore prepared to accept the estimate of Governor H.R. Parfitt that this will occur about the year 2000. I think it more significant, however, that the canal is already 57.8 percent obsolete in terms of world tonnage which can transit It. (6) In his testimony, General Dolvin correctly stated the design charac- teristics for a sea-level canal at Route 10, as those were developed by the Atlantic-Pacific Interoceanic Canal Study Commission. The channel design envisioned would accommodate 150,000 DWT vessels at all times, and 250,000 DWT vessels imder controlled conditions. The controlled conditions required 112 for the larjier vessels are the use of tidal pates to hold tidal current velocities below 2 knots, to assure controlled steerage. Tidal pates would be opened twice daily — once for a north bound convoy and once for a south bound — as tides were approaching and departing the zero point. The gates would be open from approximately 30 minutes before to approximately 30 minutes after zero tide, which would allow the passage of 1.^) to 20 ships per time period. This would more than accommodate the anticipated numbers of very large super vessels. These tidal gates were included in the cost estimate of $2.88 billion for construction of a sea-level canal at Route 10. Moreover, the Commission de- termineorts and facilities in the United States can accept supertankers: Long Beach — 130,000 DWT; Cherrv Point and Anacortes (oil terminals onlv)— 125.000 DWT; Seattle (one grain berth only)— 225.000 DWT; Valdez— 300,000 DWT berth limitation but unlimited draft in harbor; Long Island Sound (offshore facility owned by North ville Dock Corporation) — 125,000 DWT; Monterey Bay (several off- shore l)uoys) — 125.000 DWT. In addition, construction is under way on LOOP, off New Orleans, which will be able to accommodate 500,000 DWT vessels. Plans are also l)eing made for Sea Dock, off Freeport, Texas, which would accommodate vessels of the same size as LOOP. (8) In stating that foreign investment in construction of a sea-level canal would lie a real estate investment, I did not mean to imply that the foreign investor would own the real estate. I meant that by investing in very long- term mortgages on the real estate, the low rates would serve as a hedge against inflation. (9) In talking with Alaskan and other West Coast lumber officials I have been told that a sea-level canal would make shipment of their products to the East Coast more economical. (10) In conjunction with the World Bank, the Suez Canal Authority is now engaged in operations to deepen and widen the Suez Canal. The first stage of this proiect has now been completed, permitting vessels of 53 feet draft to transit the canal. This means that ships of 150.000 DWT laden, and 300,000 DWT in ballast may transit the canal. When the second stage is completed (approximately at the end of 1981). ves.sels of 250,000 DWT laden and 380,000 DWT in ballast will be able to u.se the canal. (11) I am not aware of research on steering in confined channels which may have been done .since the Commission issued its report. However, Gulf Oil Company's pilot training facility in France may have conducted research in this area. I hope these respon.ses adequately address the questions you raised. Please let me know if I can provide further information. Mr. Metcalfe. I would like to thank you, on behalf of this com- mittee and the staff, for all of the time and enerjjy. and the informa- tion that you have given us, Senator Gravel. It has been very enlighteninor, and it has been very profitable for us to have had you on our first day of hearings. Senator Gravel. I thank you, INlr. Chairman. Mr. Metcalfe. We profoundly express our thanks, especially for the amount of time we have taken from your very, very busy schedule. Senator Gr'avel. I appreciate the o])portunity to come. But let me reiterate my offer made earlier. You have an unusually fine witness list. Some will be supporting me; some opposed. If there are ques- tions that arise as a result of testimony. I will be happy to come back informally or formally, whatever would be the wish of the com- 113 mittee. This is one of my major projects in my legislative agenda, and I am prepared to spend whatever time is required to help tlie committee in its deliberations. Thank you. Mr. Metcalfe. Thank you, Senator Gravel. The Subcommittee on Panama will now recess until Tuesday, June 27, at 10 a.m. [Whereupon, at 5 :10 p.m., the subcommittee recessed to reconvene on Tuesday, June 27, 1978.] UPDATING OF SEA-LEVEL CANAL STUDIES TUESDAY, JUNE 27, 1978 House of Representatives, Committee ox INIekchaxt Marine and Fisheries, Subcommittee on Panama Canal, Wiishington^ B.C. The subcommittee met, i)ursuant to notice, at 10:10 a.m., in room 2226, Raybuin House Office Building, Hon. Ralph H. Metcalfe (cliairnian of the subcommittee) presiding-. Present : Representative Metcalfe. Staff present : Coleman Conroy, professional staff, Panama Canal Subcommittee; Bernard Tannenbaum, consultant to Committee on Merchant Marine and Fisheries; Terrence AV. Modglin, professional staff, Panama Canal Subconunittee; Nicholas T. Nonnenmacher, professional staff, minority, Panama Canal Subcommittee; and Mrs. Anita C. Brown, clerk, Panama Canal Subcommittee. Mr. Metcalfe. The Subcommittee on Panama Canal will come to order. The Chair asks unanimous consent that we proceed with these hearings without the presence of a minority member this morning because of the unusual circumstances. Hearing no objection to my request, it will be so ordered and we will proceed. Good morning. This is the second day of hearings relating to whether the "1970 Sea-Level Canal Study" should be updated. In its first day of hearings, the subcommittee gathered consider- able information from the major proponent of a sea-level study. Sen- ator G ra vel o f Al a sk a . Today we will hear from administration witnesses. Their testi- mony will hopefully enable us: (1) To assess how the Executive would work with any Study Commission that might be created; (2) to determine how any sea-level studv would fit in with the require- ments for implementing the 1077 Panama Canal Treaty, and (3) to analyze those events which have taken place since 1070 that may compel a new study. The testimony today is indispensible if we are to decide whether an update of the sea-level study is in itself a meritoiious concept, and if it is meritorious, wliether the timing suggested in the legislation before us is correct. At this time I would defer to other members who are present for any statement they may wish to make, but none are present at this time. (115) 116 Our first witness for today's liearing is Ambassador David Popper. Ambassador Popper is a career Foreign Service officer. Since August 1977, he has served as Deputy for Panama Canal Treaty Affairs. He is a former Ambassador to Chile, and Cyprus, and a former As- sistant Secretary of State for International Organizational Affairs. Ambassador Popper has been with the Department of State since 1945. Ambassador, if you will proceed with your statement, please. It is rather brief. You may choose to give it in its entirety, or you may choose to summarize it. The entire statement will be entered into the record. Proceed, Ambassador. STATEMENT OF HON. AMBASSADOR DAVID H. POPPER, COORDINA- TOR FOR TREATY IMPLEMENTATION, DEPARTMENT OF STATE; ACCOMPANIED BY RICHARD R. WYROUGH, DEPUTY TO AMBAS- SADOR POPPER; MONCRIEFF J. SPEAR, TREATY IMPLEMENTA- TION STAFF; AND TERENCE J. FORTUNE, ATTORNEY ADVISOR Ambassador Popper. Thank you, Mr. Chairman. I am very happy to be here today, for my first appearance. I hope that it will not be my last before this august body. I should like, if I may, to read the statement, since it will not take more than the ten minutes allotted. Mr. Chairman, I appreciate the opportunity to appear before this committee, to share with you the views of the Department of State on a number of legislative proposals providing for a new study of the feasibility of a sea-level canal across the Central American Isthmus. My remarks will be directly largely toward the organiza- tional and foreign policy aspects of the proposals. Representatives from other agencies will comment on the proposals from other points of view. As the committee recalls, the latest of such studies was made by the Atlantic-Pacific Interoceanic Canal Study Commission. Its find- ings were published in 1970. The proposals now before the commit- tee proceed from the assumption that an updating of the 1970 study is required at this time. Undeniably, the situation has changed since the 1970 study was completed. The trend toward the use of larger vessels — supertankers and large bulk carriers — has continued. The exploitation of Alaskan North Slope oil deposits has produced new transportation and marketing problems. The rapidly increasing flow of foreign petro- leum imports into the United States is another new factor. At the same time, prospects for the security and continued operation of the existing Panama Canal have been strengthened through the adoption of the Panama Canal Treaties. The importance of other factors must be recognized as well. There has been increasing emphasis on the environmental problems which the construction of a sea-level canal would entail. Defense require- ments have evolved over time, and their impact requires periodic reassessment. 117 Finally, the question of costs — or, more properly speaking, tlie cost-benefit relationship — may be critical. If economic considerations are thought to be paramount, projections on the volume and char- acter of traffic through a sea-level canal at varying toll levels, and the income such traffic would generate, would have to be worked out. The best means of evaluating these factors, as they have evolved over time is through periodic restudy by qualified individuals. How- often such a study should be made, and how a study group should be organized, are proper questions for this committee's examination. As the committee knows, the negotiations leading to the new Panama Canal Treaties have from the start included consideration of the sea-level canal option. Until the Senate considered the Canal Treaty, article XII of that treaty contained a paragraph which in effect gave the United States a right of veto on the construction of a new inter-oceanic canal by any other party in Panama, during the life of the treaty. For its part the United States agreed, during that same period, not to nego- tiate with third states for the right to construct a Western Hemi- sphere interoceanic canal without Panama's approval. Since a number of Senators considered this provision unduly re- strictive from our standpoint, it was in effect removed from the treaty through mutual waivers contained in the instruments of ratification of both countries, as required by a Senate reservation. Thus, the United States retains freedom of action to negotiate with any country with respect to another Western Hemisphere inter- oceanic canal. Panama is similarly free to arrange with any govern- ment or private enterprise for a second canal in Panama. The treaty provides, in article XII, that "during the duration of this Treaty, both parties commit themselves to study jointly the feasibility of a sea-level canal in the Republic of Panama. From the foreign policy standpoint I would offer two general observations which conditions our views on the proposals the Sub- committee is considering. I have in mind particularly Chairman Murphy's bill, H.R. 13176, and Senator Gravel's amendment to the Navigation Development Act. First: A study at this time could be criticized as premature. It might be preferable to put the new treaty relationships into place before embarking upon a study of a sea-level canal. This committee might well prefer to complete its consideration of the treaty imple- menting legislation first of all. The timing, in other words, is not fully compatible with the most orderly procedure for effectuating the new treaty system — a task which is bound to be complex. Second : The definitive study of a sea-level canal in Panama undertaken now or later should be accepted by the Governments of the United States and Panama as the joint study envisaged in the Panama Canal Treaty. Any other procedure could give rise to con- fusion, and might require a duplicative study. When Congress does adopt legislation, we believe it would be de- sirable to insure that it is undertaken pursuant to article XII of the treaty. This will require certain changes in the proposals. In this regard, I should like to make, if I may, five specific sug- gestions : 118 First: The President should be authorized to formalize the joint aspects of any study, throu^jh an agreement with the Government of Panama, which will make it clear that the joint study satisfies the requirements of article XII of the treaty. Second: The terms of reference of a study commission should be sufficiently broad to permit implementation of arrangements that ■nay be required as a result of negotiations with Panama. Third: The Panamanian members of the Commission should be appointed by the Government of Panama, and not the President of the United States. Fourth: The proceedings of the Commission should be bilingual to the extent necessary ; and finally. Fifth : The report of the Commission should be made to the Gov- ernments of the United States and Panama. Changes along these lines would help to bring Chairman Murphy's and Senator Gravel's proposals into conformity with the Panama Canal Treaty requirements. With respect to both proposals, we believe that the American members of the Study Commission should function as a separate unit, without Panamanian participation, in the consideration of canal sites outside of Panama. Chairman Murphy's bill makes this distinction very clearly, and, we think, usefully. We commend the attention given in these proposals to the im- portance of environmental studies. Article VI of the treaty requires that the treaty be implemented in accordance with sound environ- mental practices. We also note that Chairman Murphy's earlier proposal, H.K. 10087, specifically limits any studies under its terms to consideration of a canal constructed by nonnuclear means. This too is consistent with U.S. Government policy and treaty obligations. To sum up, Mr. Chairman, we suggest that any sea-level canal study should : Distinguish clearly between the joint study called for by the Treaty with respect to a sea-level canal in Panama, and any unilat- eral study by the T^.S. Government of an interoceanic canal; Enable the President to implement the study called for in the first paragraph of article XII of the treaty, after negotiating the details with Panama ; and Continue to stress the importance of all relevant factors, including engineering feasibility, economic viability, the contribution to United States and Hemisphere defense, political implications, and environ- mental considerations. Mr. Chairman, I hope the committee will find it possible to take these observations and suggestions into account. They are designed to meet the technical problems raised by the present proposals, par- ticularlv in the light of the treat}^ requirements. Thank you. Mr. Metcalfe. Thank you very much. Ambassador. Having heard your statement on the State Department's views, it seems very much to be in accord with my own views in terms of the flexibilitv required and the manner and the timing of the implemen- tation of the treaties. 119 I would like to coiiipliinent you on the statement that you have presented us, because to me it is vitally important to recognize that timing is a major factor in our relationship with Panama. We in the United States are off to a very good start, based on the fine reception that we received when we went to Panama for the signing of the instruments of treaty ratification. We would like to keep that accord and momentum going as long as possible, and if at all possible, to even enhance it. I think the accord is very high right now. That is germane to my thinking on this legislation, and I want to share my thoughts with you. In the administration's draft of treaty implementing legislation, there were only a few lines on the subject of a joint sea-level study with Panama. Do you prefer that approach to the one taken by the Gravel amendment, and the Murphy bills? Ambassador Popper. Mr. Chairman, may I first say that I fully appreciate and share your remarks with respect to the desirability of proceeding smoothly and amicably, as we have thus far, with the Government of Panama, looking toward the coming into force of the Panama Canal Treaty. You were asking about the language of the draft implementing legislation. I might note that it provides that the President shall appoint the representatives of the United States to any joint body which is set up, but does not specify, as do the various pieces of leg- islation before the committee, the details and the modalities by which such a Commission should function. It leaves, in other words, a flexibility and leeway for executive action, in very much the same way as Congressman Murphy's ori- ginal proposal (IT.R. 10087) did. That proposal gives the President the authority to carry out the study, without the specifics concerning the appointment of individual members, one by the Speaker of the House, one by the President, and one bj^ the President of the Senate. I must say, from the operational standpoint and on the Executive side, that broad flexible legislation makes it easier to negotiate with Panama, and to work out suitable terms and conditions for setting up and operating such a Commission. While the scheme laid out in the various pieces of legislation is not in itself undesirable, it does limit the Executive Branch in nego- tiating with Panama for the beginning and the continuation of the joint study. It is specific as to the personnel limits, time limits, and other matters which could be restrictive factors in negotiating with Panama. Mr. Metcalfe. Does the State Department's experience with bi- national commissions lead us to any conclusions about how a sea-level study should be organized. Ambassador Popper. I am not sure that there is any exact com- parison. As you Imow, Mr. Chairman, the U.S. Government has organized joint commissions in recent years with a number of countries with which we have especially close or difficult relations. What comes to mind at once are the Joint U.S. -Canadian Commission and the Joint T^.S. -Mexican Commission. We have others with Japan and Western European countries, such as Germany. 120 In all those cases the Commissions are organized on a basis of parity, with the two Governments contributing equally through their own staflFs, and through a small joint organization when they work together. These Commissions function with a large degree of au- tonomy, but under the general umbrella of the Department of State in the U.S. Government. The circumstances are so different here, the depth of the technical study is so great, and the disparity of resources between the United States and Panama is so great that it seems to me that one must approach this particular task sui genctns, as if it were something special, and deal with it jjragmatically and reasonably in light of the circumstances that we have. So I would not say that I felt that the guidelines which are normal for intergovernmental joint commissions should necessarily apply in their entirety here. Mr. Metcalfe. Having cited the other treaties and negotiations with other countries, I agree that this situation is not comparable to the others, because of the tension that has existed in Panama, as against the United States, and that tension is not a recent origin, as we well Ivnow. Because the tension goes back really to the year 1903, and I concur with you, Mr. Ambassador, in your analysis of it, and appreciate it. Would the State Department's role in the formulation of U.S. foreign policy be circumvented by the proposed commissions and councils in the legislation before us? Ambassador Popper. I do not believe that the State Department's role would be circumvented. I must say that, at least personally, I have some problem with the thought that the commission should be organized in the way specified in Senator Gravel's and Congressman Murphy's bills. The 1964 to 1970 Commission, the Atlantic-Pacific Interoceanic Canal Study Commission, was a Presidentially-organized Commis- sion. The original Murphy bill would establish a commission ap- pointed by the President. I ask myself whether the new formulation in H.R. 13176 does not perhaps tip the balance a little far on the legislative side, in that the President would appoint only one of the three members of the Commission, with the others coming from the legislative side. I think that is a factor to be taken into account. I would also say that, in my opinion, the rather tight restriction which exists, in particular in Chairman Murphy's bill as to phasing and timing, may not leave the desired flexibility in the hands of the Executive Branch to deal with unforeseen circumstances which could develop over the period between now and approximately the year 1984, the date to which the train of events foreseen in Con- gressman Murphy's bill would bring us if we proceeded through the .series of actions that bill provides. Consequently, I would make a plea for Executive Branch repre- sentation in the Commission at a reasonable level, and for enough flexibility in timing to allow for a possible delay of events and to allow for the fact that we are nogtiating, after all, with a foreign government which will want to make its input. We may need more 121 flexibility, in particular, as regards the structure of a study cora- mission, Mr. Metcalfe. Do you think that the Panamanians would find ac- ceptable a study that would go only to the point of satisfying that Route 10 is the route to be selected, or do you think that the Pana- manians want a study with wider scope ? Ambassador Popper. I hesitate to speak for the Panamanians on this subject, Mr. Chairman, because I have not myself pursued the discussion with them to the point where I could say that I had per- ceived any clear ideas on their part. I think they are receptive to the thought that one day an interoceanic sea-level canal might be a useful thing. If that were so, they would certainly have a lively in- terest in working out with the United States the terms and condi- tions under which such a canal should be constructed and operated since, of course, they would be a prime beneficiary. Whether their thoughts have gone far beyond that point, I could not say. Mr. Metcalfe. Mr. Ambassador, in light of the language of para- graph 1 of article XII of the Panama Canal Treaty, should Pan- ama contribute any of the funds for a joint sea-level study? Ambassador Popper. The treaty is silent on that point, as you Imow, Mr. Chairman. I think it would be unrealistic to expect the government of Panama to provide resources on a scale commensurate with those of the U.S. Government. A question for future considera- tion is whether it would be better, as the existing proposals pro- vide, for the United States to provide the entire financing other than the salaries or remuneration of the Panamanian members, or whether arrangements should be made for some other type of contribution by the Panamanians, for example office space and facilities, and so on. I think the guiding principle should be that we should not expect Panama to make a contribution which would go beyond its capacity easily to do so. I do not believe that we intended, or anyone intends, to condition the study upon a burdensome assumption of obligations by the Gov- ernment of Panama. Mr. Metcalfe. Mr. Ambassador, my next statement, or question, is not directed specifically to you, but to anyone who is scheduled to testify, or anyone in the audience today. Recognizing that the difficulty that we have had with the Ameri- can people accepting the Panama Canal Treaties before they were signed, even before the articles of ratification were signed, with so many people having the mistaken idea that we have sovereignty over the canal, and that we would be giving up some territory, how can we talk of a sea-level canal ? This is one of the major f actors^ of resistance, as well as contribution of the opinion that there is going to be an exchange of money, when in fact there will not be, because it will be in another form, trust, agreement, or what have you. This is something on which I think we ought to place a great deal of importance, as to how we disseminate this information as to Pan- ama's contribution financially to a sea-level canal, if a sea-level canal were ever to be built. I just wanted to make that observation to you, so that we do not 122 blunder into a situation, and create more animosity than was created when we first entered into serious negotiations on the treaty. Do I make myself clear to you ? Ambassador Popper. Yes, sir, you do. And it is a point which I think it would be very wise for us to keep in mind as we approach negotiations with Panama about this subject. Any untoward effects should be minimized by taking into account the desirability of as- sociating Panama in obligations as well as benefits in this matter. INIr. Metcalfe. I believe that a contributing factor will be the timing of this study, when and if it is going to be done, so that the American people will be receptive to the idea of the study, so that we do not have anything else flare up. Now, I am concerned about the possible ecological effects of the sea-level canal. Can you foresee a situation in which the adverse ef- fects of a sea-level canal would harm our relations with some of the Caribbean countries whose economies depend on the tourist trade? Ambassador Popper. Mr. Chairman, I am really not competent to answer that question, because I am simply not familiar enough with the possible ecological effects, the environmental effects, of a sea-level canal. I believe you will have appearing before you later today a wit- ness who is much more capable than I of discussing them. Obviously, if some of the dire effects about which people have speculated should come to pass, and there should be a real change in the flora and fauna of one ocean or the other, that could have a far- reaching effect, but I am simply not capable of saying what the prob- ability is that that sort of thing would happen. Mr. Metcalfe. I have one more question before I turn it over to the staff, Mr. Ambassador. Would the recently approved Neutrality Treaty with Panama ap- ply to any sea-level canal in that country ? Ambassador Popper. Yes, it would, sir, to any interoceanic wa- terway in which we participate. Mr. Metcalfe. Thank you. Mr. Modglin, do you have any questions for the Ambassador? Mr. Modglin. Just one question, Mr. Chairman, to follow up on your question. Ambassador, have any countries other than Panama expressed to the Department of State any interest in, or objection to, construc- tion of a sea-level canal in the Western Hemishpere, either in their own country, or in Panama ? Ambassador Popper. None to my knowledge, certainly not in the near term. Mr. Modglin. That is all. Mr. Metcalfe. Mr. Nonnenmacher, do you have any questions of the Ambassador? Mr. Nonnenmacher. Yes, sir, I have a few questions. On behalf of Mr. Snyder, who could not be present, I would like to welcome you, Mr. Ambassador, and members of your staff, most of whom I imow, and have enjoved debating with in the past. I would like to ask you, for the sake of the record, to briefly set forth your past and present duties as Coordinator for Treaty Imple- mentation. Just precisely what does that mean? Ambassador Popper. Yes. I returned from Chile in June of 1977. At that time the negotiations for the Panama Canal Treaty were 123 entering a final phase. When those negotiations were complete, Am- bassador Linowitz, who had taken part as conegotiator, stepped down and left Government service. I moved in as Deputy to Ambassador Ellsworth Bunker, not for the negotiations, which were completed, but for the phase which followed, namely the task of preparing the treaties for approval by the Senate, and the task of obtaining that approval. I have served in that capacity since August, 1977. I have been asked now, with the Treaties completed, to stay on and coordinate for the Department of State, the process of preparing for imple- mentation of the Treaties. That includes dealing with the implement- ing legislation and its passage through the Congress, as well as as- sisting in the planning which must take place before treaty day, the day on which things start to move on the ground, which we antici- pate might be Oct. 1, 1979. In that capacity I coordinate within the Department of State our positions and actions on these subjects. I consult closely with my col- leagues in the Department of Defense, and as required, other depart- ments, and I am in close touch with the Panamanian Embassy in Washington and our Embassy in Panama. That is a brief summary of my duties. Mr. NoNNENMACHER. Thank you. In other words, I would imagine that we can expect to see more of you in the future, as the House gets into implementing legislation ? Ambassador Popper. It would be my pleasure. Mr. NoNNENMACHER. Well, in view of that, would you tell us, or can you tell us, what is the status of the implementing legislation at the present time ? Ambassador Popper. Yes. Mr. NoNNENMACHER. We are awaiting it over here. We are aware of it, as the draft was inserted in the Congressional Record by Sena- tor Brooke on April 5, Can you tell us what is the hold-up ? Ambassador Popper. Yes. The legislation prepared originally, I believe by the Department of State principally, was submitted to the Office of Management of Budget. That office, as is normal in these matters, has imdertaken to obtain the views of other departments of government. That process is largely completed, and when it is com- pleted, and any differences are ironed out, we would expect that it would be approved by the White House for submission to the Con- gress. We hope this will take place very shortly. Mr. NoNNENMACHER. INIay we expect it before the election? Ambassador Popper. Well, I would not like to be pinned down as to dates, since it is not a matter within the control of the Department of State. I would certainly hope so. Mr. NoNNENMACHER. All right. In your statement, on page 2, you say, "as the committee Imows, the negotiations leading to the new Panama Canal Treaties have from the start included consideration of the sea-level canal option." I do not want to dispute that, but last Wednesday, Senator Mike Gravel gave us a little different impression. He took credit for — at least, it seemed to us — he took credit for having pressed for the in- clusion of an article in the treaties specifically dealing with the sea- level canal. He gave the impression that he discovered, on a trip to 32-461 O - 78 - I 124 the Canal Zone, that this matter was not being considered seriously by either Panama or the United States. Now, could you enlighten us a little bit further on that? Ambassador Popper, Yes, sir, on my left I have Mr. Richard Wy rough, who did take part in the negotiations on this and other parts of the treaty, and I would like to ask him to reply. Mr. Wyrough. I participated in the negotiations, as you know, since early 1974. The actual negotiations, the negotiation of the principles and the issues involved in the negotiations, began in the summer of 1974, 4 years ago this month. From the very beginning, it was always our intention to take up at the appropriate time and to include in the treaty some provisions respecting expansion to include the possibility of construction of a sea-level canal. Mr. NoNNENMAcriER. All right, thank you. Might I ask a question regarding the emphasis, however, on the sea-level canal? Either Mr. Wyrough or Ambassador Popper may answer. It is my understanding that the 1967 treaty negotiations were, by and large, carried out on a more or less parallel, or simultaneous, basis with the sea-level canal study, with the idea being that we would turn over the existing canal to Panama, but that would be done because we were going to build a sea-level canal which the United States would continue to operate. In the current treaties, the impression has been given, and maybe we have gotten the wrong impression over here on the committee, but the impression certainly exists here that a sea-level canal was never a major goal of the administration, with the ultimate end that it would replace the present canal which would be given to Panama. Would either of you care to comment, to make a comparison be- tween the goals of the two sets of treiities, 1967 and the recently con- cluded one ? Ambassador Popper. I happen to have looked at the statement made by President Johnson in 1964, when he linked very closely the beginning of the negotiations for what turned out to be the 1967 draft treaties and the desirability of a serious study of the sea-level canal. As you know, in 1967 we came up with three treaties, one of which was devoted to the possibility of the construction of a sea-level canal. Under its terms the United States might have maintained con- trol for 100 years, that is to say until the year 2067. Now, I cannot speak directly about the more recent negotiations, but clearly, that has not been the case here. What we have before us, as you have pointed out, is one reference, and one article of the Panama Canal Treaty, concerning an option for a sea-level canal which is left open for the future by both sides. Mr. Wyrough. Since the 1967 Treaties were concluded, of course, a number of events have occurred. We have, for example, the 1970 study, and I think that in the intervening years there has perhaps been a slight shift in opinion as to the inevitability of the construc- tion of a sea-level canal. I believe that in the 1960's, there was in some circles perhaps, some higher certainty concerning the construction of a sea-level canal than now exists. 125 Consequently, clurino^ the recently concluded negotiations, we per- ceived the many problems, the many complexities that existed with respect to the existing canal, with respect to providing for our con- tinued use of it, for the continued security of that canal. We simply chose not to reach any definitive, detailed judgment concerning a sea-level canal. We wanted to provide for ourselves in the treaty, which has been negotiated and now ratified, the option to go forward if at some future point we decided to do so. We be- lieve that the treaty gives us all of the necessary rights that we want. Mr. NoNNENMACHER. I appreciate that enlightenment on the com- parative emphasis on the sea-level canal. Now, in view of the point that you raised, Mr. Wyrough, I would like to at this point read two or three paragraphs from the hearings that the Senate Foreign Eelations Committee held on the treaties on October 14, 1977, In volume 3 of those hearings there appears the testimony of represen- tatives of the previous Administration, and I read this preparatory to asking you, is this pretty much the opinion of the Carter, ad- ministration? Former Secretary of State Dean Rusk gives a bit of background about the Isthmian canal, and then stated this : "I personally would be surprised if we ever reached the decision to do a sea-level canal." And then, further, "If I had to be a prophet, I would certainly say that certainly there is not going to be a sea-level canal in my life- time." Mr. Henry Kissinger, also former Secretary of State, immediately spoke and said — I will skim a sentence or two — he said, "I myself have raised the question whether it is wise to place two canals in the same country. We have enough problems with one of them there, and whether it might not be better to have a sea-level canal, if we build it, in some other country." Then he went on to add, "but I think reasonable men can differ on this, and there is a definite advantage in the specific rules that we are negotiating for the potential sea-level canal, which in my judg- ment, as in Secretary Rusk's, I do not believe we will be likely to build." Would you gentlemen care to give an opinion that might reflect the Carter administration's viewpoint on whether or not it might be built in our lifetime? Ambassador Popper. Those two gentlemen, of course, were speak- ing as private citizens at the time at which they testified, and per- haps could speak with greater freedom than they might have, had they been holding official posts. I personally would not wish to speculate in this area, simply be- cause it seems to me that there is sufficient interest in, and concern about, the possibility of another canal for reasonable men to con- sider a study of the circumstances to be apppropriate. As do clearly some of your colleagues, Mr. Chairman, I would, myself, rather reserve judgment on whether in our lifetime we will or will not see one, until we get an update, whenever we do, of the facts we now have at our disposal on this problem. 126 Mr. NoNNENMACiiER. Might I ask, does the State Department have a preference at this time as between the modernization of the pres- ent canal by the never completed third locks project, and a new sea-level canal ? Ambassador Poppeij. At this stage I do not think we could say that we have any preference whatever on these subjects, but rather that we would reserve judgment until the alternatives are more clearly defined as a result of development of the situation, first, with respect to the treaties and second, with respect to any studies. Mr. NoNXENMACiiER. Do you know if Panama has a preference? Ambassador Popper. I have never had any indication that it does. I might observe that Avhereas there is a fair amount of discussion of the sea-level canal today, there is very little discussion of the third lock proposal. Mr. NoNXENMACHER. There is a very important reason behind Senator Gravel's pushing hard for a sea-level canal, and behind his successful push for an amendment in the Senate to the Navigation Act which will be coming to conference, and that is, of course, the need to get Alaskan oil through the canal, or a new canal, or by pipeline, to the gulf coast and east coast refineries. On Friday, June 16, 1978, the news carried the story about the ap- proval of the export of residual fuel, "to trim the west coast glut," as the Wa^'^hingfon Post put it. Now, the question of a tradeoff with Japan of the oil it imports, for Alaskan oil, which would allow us to import the oil that Japan now gets, seems to me would bear heavily on the issue of a new sea- level canal. If Alaskan oil is to go west, to Japan, and not south and east through the canal, for East and gulf refineries, then quite obviously the major arguments for the sea-level canal at the present time, at least in my judgment, vanish. Would you give us the State Department's position on the matter of oil tradeoffs? What has been the advice of the State Department to the administration on this matter? Ambassador Popper. I am sorry, sir. I would have to take that question and furnish the reply to you later, because I am not too familiar with it. I would simply say that, of course, the situation which exists today with respect to Alaskan oil, and market condi- tions for oil in the Pacific, is not necessarily a situation which will remain unchanged until any sea-level canal were completed. I recall from the 1970 report that a figure of 15 years was given as a figure for planning, leadtime, construction, development, and so on, for a new sea-level canal. I am not prepared to say whether if we started today on a such a canal we would still need 15 years for its completion. What I am saying is that we would really have to project the oil marketing situation some distance into the future to make a determination which would be relevant to the bearing of a sea-level canal on the international marketing of oil. Mr, NoNXENMACHER. Would you be good enough to submit what- ever the State Department would like to submit regarding a posi- tion. No. 1, and No. 2, what it feels might be, or would be the need for a sea-level canal, if indeed the tradeoff were to be approved? 127 Ambassador Popper. I would be ^lad to take that question. Mr. NoxNENMACHER. Say over the foreseeable future, over the next 10 or 20 years. Ambassador Popper. I would be glad to submit ideas on that subject. [The following was received for the record :] Need for a Sea-Level Canal The Department of Energy has recently announced actions the Administration plans to take to deal mth the immediate "glut" of oil on the West Coast. These include adjustments to the entitlements program and authorization of exports of surplus residual fuel* oil from West Coast refineries. Over the medium-term the surplus situation would be eliminated by refinery conversions and one or more of a number of pipeline proposals which have been put forward by various private companies. These include several trans-Canada routes, the Northern Tier pii)eline, the Pactex pipeline, the trans-Mexico pipeline and the trans- Guatemala pipeline. Further, the current arrangements for transshipment through the Panama Canal are being improved through the construction of per- manent on-shore facilities in Panama. The development of a sea-level canal through Panama, which would require perhaps 15 years, obviously does not offer a solution to the current situation. The use of such a canal for energy shipments in the long term would depend on an evaluation of future transportation alternatives and the extent of future dis- coveries of oil in Alaska. The export of West Coast crude in exchange for Mideast imports is a poten- tial solution to the temporary excess supply problems in California. Such a swap offers the United States certain economic advantages. However, the prohibition of crude oil exports provides a powerful incentive for the development of domes- tic transportation facilities capable of distributing Alaskan production. We be- lieve the development of those facilities to be in the national interest. The State Department is well aware of, the concern of the Congress on this subject and the legislative restrictions currently applicable to such arrange- ments. They would be considered in any recommendations to the President on this subject. Mr. NoNNENMACHER. Thank you. Can you shed any light on the plans for a pipeline across Guate- mala, or elsewhere ? Ambassador Popper. There are such plans. We have heard of them. We have no indication that definite decisions have been made with respect to construction in either case. Mr. NoNNENMACHER. You do not know whether the Guatemalan pipeline plans are actually going to go through ? Ambassador Popper. No, sir. Let me put it another way. We have no indication that they definitely are going to go through. We know that such proposals exist. Mr. NoxxEXMACHER. So the only real operation underway now is Petroterminal de Panama, and its arrangements with SOHIO? Ambassador Popper. That now takes place, with lightering and transshipment through the canal. That is all that is definitely sched- uled, so far as we know at this time. Mr. Xoxxexmaciier. I would like to address the question of the share of tolls that Panama might expect to get from a sea-level canal if the United States builds it under an arrangement similar to the new treaties. Do you think Panama would press for, or would likely gain a larger share of tolls if the sea-level canal were built, than under the present canaPs treaty arrangements, in view of the pro- posed toll hikes ? 128 Ambassador Popper. It is very difficult to answer that question, since it would be pure speculation. Obviously Panama, as in the present case, would try to get what it considered a reasonable re- turn, as a result of allowing the use of its territory for the con- struction of a sea-level canal. But how much that might be, we could not at this time determine, or even speculate about. Mr. NoNNENMACHER. I would like to ask you to comment on one of the conclusions or recommendations in the 1970 study. It speaks of Route 10, and it says: "In any arrangement for operation of a sea- level canal on Route 10 it would be unacceptable for the present canal to pass to Panamanian control and be operated in competition with the sea-level canal." I think that is quite an important statement in view of the fact that the present canal, unless something stops it in the House of Representatives, will pass to Panamanian control. How do you foresee a sea-level canal's operation? Would the two canals be in competition ? Ambassador Popper. I find it difficult to reply on any expert basis. I can only give you my impression. I would suppose it rather unlikely that the traffic flow would re- quire the full operation of two canals, although if it did, obviously the present canal could continue to be used. I would imagine that if it is a question of levels of tolls and the like, and if there were a desire to keep the two canals operating, the toll structure would re- flect that fact. I could not say at this time whether once any sea-level canal were open it would mean that the present Panama Canal was completely obsolete, and should go out of existence, or whether there would still be room for it on an ancillary basis. Mr. Nonnenmaciier. Perhaps you would like to submit some written remarks addressing that question, and relate them to the rec- ommendation of the sea-level c^nal commission that both canals be operated as a system under U.S. control, and as a followup on that, would you address the matter of defense of a proposed sea-level canal? The Commission, in 1970, cited the present bases in the Canal Zone as admirably sited and suited to defend a sea-level canal. Well, of couree, under the new treaty, there is going to be no such thing as U.S. bases after the year 2000, so we would like to have your thinking as to how the new canal would be defended. Ambassador Popper. We would be glad to do that, in conjunction with our colleagues in the Defense Department. [The following was received for the record :] Two Canals Competition of Operation A sea-level canal of the type envisaged in the 1970 Commission report could operate together with the existing canal as part of a system. The 1970 plans for a canal following Route 10 envisaged measures to Iveep the present canal func- tioning during and after the construction of a ne\v canal. It seems lilcely, how- ever, that a sea-level canal would be capable of handling all the ships transit- ing the Isthmus, and that therefore it might be uneconomical to maintain the present lock canal as well. A decision would have to be made at some stage as whether to operate two canals. 129 The United States would have a continuing national security interest in the operation and defense of a sea-level canal. The planning and execution of the defense of such a canal would depend on its site as well as relevant internation- al treaties and circumstance existing at the time. The defense of a sea-level canal along Route 10 in Panama could utilize base facilities and other infra- structure now devoted to the protection and security of the existing lock canal, but new facilities undoubtedly also would be required. A sea-level canal would be less vulnerable since it would not be as susceptible to damage in any type of attack. Mr. NoNNENMACHER. I hope to discuss that with those Defense Department witnesses a little bit later. The major question I want to address at this point is the matter of financing of the sea-level canal. Congressman Snyder and I, at least, were quite surprised to find that Senator Gravel was propos- ing a privately financed sea-level canal to be constructed in Panama, that being the only site that made any sense to him. Does the State Department have a view on whether the proposed sea-level canal could be or should be financed and undertaken by private interests entirely, or do you think that it is of the magnitude that only the U.S. Government could undertake it? Ambassador Popper. No, sir, the State Department has no view on this subject. We have not considered, in any detail, the financing of such a canal, and I think it would be premature for us to com- ment on the subject at this time. Mr. NoNNENMACHER. Well, in view of what Mr. Wy rough said, and you yourself stated in your statement, that from the beginning the idea of a sea-level canal was to be discussed, and finally was in- deed put into the treaty language, was there no idea at all as to whether or not it would be a Government undertaking, or a joint Government undertaking? Ambassador Popper. Mr. Wy rough tells me it was just not a mat- ter that was discussed. So that I do not think one could respond in any definite way to what you suggested. Mr. NoNNENMACHER. I think I have almost completed the ques- tions I have prepared. But there is one last area I would like you to address as coordinator of treaty implementation. Senator Jesse Helms on June 5 made an exhaustive analysis of the Panamanian Foreign Ministry's communique, which is a — I do not know what precise word I should use here — perhaps disavowal is the best I can think of, of the U.S. Senate amendments to the treaty. Would you address your remarks, and if you care, you could ad- dress them in writing, as well, but would you please give us your impression of the protocol, or the instrument that President Carter and Chief of State Torrijos signed in Panama recently, as it relates to the official disavowal by the Panamanian Foreign Ministry of the amendments, reservations, and the like added by the U.S. Senate to the treaties? This is a very important matter to us, because we do not laiow whether the treaty means what the Senate says it means, or what the Panamanian Foreign Ministry interprets it to mean. Ambassador Popper. The Panamanian Foreign Office issued a communique on the treaties, and the Senate amendments, conditions, reservations, and understandings on April 25. We do not construe 130 that communique as a disavowal. It is a commentary on the treaty, on the Senate amendments, et cetera, as seen from the Panamanian Foreign Ministry point of view. Some of those Senate amendments, the Panamanians embrace more or less enthusiastically in the April 25 communique. Other amendments they regard as unfortunate, and the trend of their thinking comes out clearly in the communique. The communique is not a legal document. It is not a binding commitment upon the Gov- ernment of Panama or the Government of the United States. What is binding, as you have suggested, is the protocol of exchange of in- struments of ratification, and those instruments themselves, which were delivered by each Government to the other in the ceremony on June 16. In the protocol of exchange, the government of Panama, in effect, fully accepts the Senate observations and conditions. The language of the protocol of exchange includes the following, and I quote: Said amendments, conditions, reservations and understandings have been communicated by the Government of the United States of America to the Gov- ernment of the Republic of Panama. Both Governments have agreed that the Treaties, upon entry into force in accordance with their provisions, vv'ill be ap- plied in accordance with the above-mentioned amendments, conditions, reserva- tions and understandings. That is, I think, the legal position. We would regard this as the definitive statement that the actions taken by the Senate are incorporated in the binding obligations of the parties. Mr. NoNNENMACHER. Would they be implemented in the light of Panama's interpretation ? Ambassador Popper. Well, there are always going to be some dif- ferences of interpretation about complex matters of this kind. How- ever, our feeling is that if we proceed with the implementation of these treaties with the same good faith that characterized their nego- tiation, we will be able to deal with those interpretations in the light of the carefully-framed language of the treaties, all their ancil- lary documents, and the provisions added by the Senate, and by the Panamanian Government during the course of ratification. Mr. NoNNENMACHER. Mr. Chairman, I would like to ask if the exchange of documents, the protocol and the accompanying docu- ments might be inserted in the record at this point ? Mr. Metcalfe. Hearing no objection, it will be so ordered. [The following was received for the record :] 131 DOCUMENTS II^VOLVED IN THE RATIFICATION CEREMONY FRIDAX JUNE 16, 1978 EMBARGOED FOR RELEASE UNTIL FRIDAY JUNE 16 5pm, EDT. 132 PROTOCOL OF EXCHANGE OF INSTRUMENTS OF RATIFICATION REGARDING THE TREATY CONCERNING THE PERMANENT NEUTRALITY AND OPERATION OF THE PANAMA CANAL AND THE PANAMA CANAL TREATY The undersigned, Jinuny Carter, President of the United States of America, and Omar Torrijos Herrera, Head of Government of the Republic of Panama, in the exercise of their respective constitutional authorities, have met for the purpose of delivering to each other the instruments of ratification of their respective governments of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal and of the Panama Canal Treaty (the "Treaties") . 133 The respective instiuments of ratification of the Treaties have been carefully compared and found to be in due form. Delivery of the respective instruments took place this day, it being understood and agreed by the United States of America and the Republic of Panama that, unless the Parties otherwise agree through an exchange of IJotes in conformity with the resolution of the Senate of the United States of America cf April 18, 1978, the exchange of the instruments of ratification shall be effective on April 1, 1979, and the date of the exchange of the instruments of ratification for the purposes of Article VIII of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal and Article II of the Panama Canal Treaty shall therefore be April 1, 1979. The ratifications by the Government of the United States of America of the Treaties recite in their entirety the amendments, conditions, reservations and understandings contained in the resolution of March 16, 1978, of the Senate of the United States of America advising and consenting to ratification of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, and the reservations and understandings contained in the resolution of April 18, 1978, of the Senate of the United States of America advising and consenting to ratification of the Panama Canal Treaty. Said amendments, conditions, reservations and understandings have been communicated by the Government of the United States of America to the Government of the Republic of Panama. Both governments agree that the Treaties, upon entry into force in accordance with their provisions, will be applied in accordance with the above-mentioned amendments, conditions, reservations and understandings. Pursuant to the resolution of the Senate of the United States of America of March 16, 1978, the following text contained in the instrument of ratification of the United States of America of the 134 Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal and agreed upon by both governments is repeated herewith: "Nothing in the Treaty shall preclude the Republic of Panama and the United States of America from making, in accordance with their respective constitutional processes, any agreement or arrangement between the two countries to facilitate performance at any time after December 31, 1999, of their responsibilities to maintain the regime of neutral- ity established in the Treaty, including agreements or arrangements for the stationing of any United States military forces or the maintenance of defense sites after that date in the Republic of Panama that the Republic of Panama and the United States of America may deem necessary or appropriate.". The Republic of Panama agrees to the exchange of the instruments of ratification of the Panama Canal Treaty and of the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal on the understanding that there are positive rules of public international law contained in multilateral treaties to which both the Republic of Panama and the United States of America are Parties and which consequently both States are bound to implement in good faith, such as Article 1, paragraph 2 and Article 2, para- graph 4 of the Charter of the United Nations, and Articles 18 zmd 20 of the Charter of the Organization of American States. It is also the understanding of the Republic of Panama that the actions which either Party may take in the exercise of its rights and the fulfillment of its duties in accordance with the aforesaid Panama Canal Treaty and the Treaty Concern- ing the Permanent Neutrality and Operation of the Panama 135 Canal, including measures to reopen the Canal or to restore its normal operation, if it should be interrupted or obstructed, will be effected in a manner consistent with the principles of mutual respect and cooperation on which the new relationship established by those Treaties is based. IN WITNESS THEREOF, the respective Plenipotentiaries have signed this Protocol of Exchange at Panama, in dupli- cate, in the English and Spanish languages on this sixteenth day of June, 1978, both texts being equally authentic. FOR THE UNITED STATES FOR THE REPUBLIC OF AMERICA: OF PANAMA: 136 (U.S. INSTRUMENT-PANAMA CANAL TREATY) JIMMY CARTER President of the United States of America TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING: CONSIDERING THAT: The Panama Canal Treaty was signed at Washington on September 7, 1977; and The Senate of the United states of America by its resolution of April 18, 1978, two-thirds of the Senators present concurring therein, gave its advice and consent to ratification of the Treaty, subject to the following: 137 (a) RESERVATIONS: (1) Pursuant to its adherence to the principle of non- intervention, any action taken by the United States of America in the exercise of its rights to assure that the Panama Canal shall remain open, neutral, secure, and ac- cessible, pursuant to the provisions of the Panama Canal Treaty, the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, and the resolutions of ratification thereto, shall be only for the purpose of assuring that the Canal shall remain open, neutral, secure, and accessible, and shall not have as its purpose or be interpreted as a right of intervention in the internal affairs of the Republic of Panama or interference with its political independence or sovereign integrity. (2) The instruments of ratification of the Panama Canal Treaty to be exchanged by the United States of America and the Republic of Panama shall each include provisions whereby each Party agrees to waive its rights and release the other Party from its obligations under paragraph 2 of Article XII of the Treaty. (3) Notwithstanding any provision of the Treaty, no funds may be drawn from the Treasury of the United States of America for payments under paragraph 4 of Article XIII without statutory authorization. (4) Any accumulated unpaid balance under paragraph 4(c) of Article XIII of the Treaty at the date of termination of the Treaty shall be payable only to the extent of any operating surplus in the last year of the duration of the Treaty, and nothing in such paragraph may be construed as 138 obligating the United States of America to pay, after the date of the termination of the Treaty, any such unpaid balance which shall have accured before such date. (5) Exchange of the instruments of ratification of the Panama Canal Treaty and of the Treaty Concerning the Perma- nent Neutrality and Operation of the Panama Canal shall not be effective earlier than March 31, 1979, and such Treaties shall not enter into force prior to October 1, 1979, unless legislation necessary to implement the provisions of the Panama Canal Treaty shall have been enacted by the Congress of the United States of America before March 31, 1979. (6) After the date of entry into force of the Treaty, the Panama Canal Commission shall, unless otherwise provided by legislation enacted by the Congress of the United States of America, be obligated to reimburse the Treasury of the United States of America, as nearly as possible, for the interest cost of the funds or other assets directly invested in the Commission by the Government of the United States of America and for the interest cost of the funds or other assets directly invested in the predecessor Panama Canal Company by the Government of the United States of America and not reimbursed before the date of entry into force of the Treaty. Such reimbursement for such interest costs shall be made at a rate determined by the Secretary of the Treasury of the United States of America and at annual intervals to the extent earned, and if not earned, shall be made from subsequent earnings. For purposes of this reser- vation, the phrase "funds or other assets directly invested" shall have the same meaning as the phrase "net direct investment' has under section 62 of title 2 of the Canal Zone Code. 139 (b) UNDERSTANDINGS: (1) Before the first day of the three-year period beginning on the date of entry into force of the Treaty and before each three-year period following thereafter, the two Parties shall agree upon the specific levels and quality of services, as are referred to in paragraph 5 of Article III of the Treaty, to be provided during the following three- year period and, except for the first three-year period, on the reimbursement to be made for the costs of such services, such services to be limited to such as are essential to the effective functioning of the Canal operating areas and the housing areas referred to in paragraph 5 of Article III. If pa^Tnents made under paragraph 5 of Article III for the preceding three-year period, including the initial three- year period, exceed or are less than the actual costs to the Republic of Panama for supplying, during such period, the specific levels and quality of services agreed upon, then the Panama Canal Commission shall deduct from or add to the payment required to be made to the Republic of Panama for each of the following three years one-third of such excess or deficit, as the case may be. There shall be an inde- pendent and binding audit, conducted by an auditor mutually selected by both Parties, of any costs of services disputed by the two Parties pursuant to the reexamination of such costs provided for in this understanding. (2) Nothing in paragraph 3, 4, or 5 of Article IV of the Treaty may be construed to limit either the provisions of the first paragraph of Article IV providing that each Party shall act, in accordance with its constitutional 32-461 0-78-10 140 processes, to meet danger threatening the security of the Panama Canal, or the provisions of paragraph 2 of Article IV providing that the United States of America shall have primary responsibility to protect and defend the Canal for the duration of the Treaty. (3) Nothing in paragraph 4(c) of Article XIII of the Treaty shall be construed to limit the authority of the United States of America, through the United States Gov- ernment agency called the Panama Canal Commission, to make such financial decisions and incur such expenses as are reasonable and necessary for the management, operation, and maintenance of the Panama Canal. In addition, toll rates established pursuant to paragraph 2(d) of Article III need not be set at levels designed to produce revenues to cover the payment to the Republic of Panama described in paragraph 4 (c) of Article XIII. (4) Any agreement concluded pursuant to paragraph 11 of Article IX of the Treaty with respect to the transfer of prisoners shall be concluded in accordance with the con- stitutional processes of both Parties. (5) Nothing in the Treaty, in the Annex or Agreed Minute relating to the Treaty, or in any other agreement relating to the Treaty obligates the United States of America to provide any economic assistance, military grant assistance, security supporting assistance, foreign military sales credits, or international military education and training to the Republic of Panama. (6) The President shall include all reservations and understandings incorporated by the Senate in this resolution 141 of ratification in the instrument of ratification to be exchanged with the Government of the Republic of Panama. NOW, THEREFORE, I, Jimmy Carter, President of the United States of America, ratify and confirm the Panama Canal Treaty, subject to the aforementioned reservations and understandings, and on behalf of the United States of America undertake to fulfill it faithfully. I further hereby waive, in the name of the United States of America, the rights of the United States of America under paragraph 2 of Article XII of the Panama Canal Treaty and release the Republic of Panama from its obligations under paragraph 2 of Article XII of the Panama Canal Treaty. IN TESTIMONY WHEREOF, I have signed this instrument of rati- fication and caused the Seal of the United States of America to be affixed. DONE at the city of Washington, this th day of June in the year of our Lord one thousand nine hundred seventy-eight and of the independence of the United States of America the two hundred second. By the President: Secretary of State 142 (PANAIIANIAIJ INSTRUMENT - PANAMA CANAL TREATY) Whereas the Panama Canal Treaty was signed In Washington on September 7, 1977, by the authorised representatives 'of the Gov- ernment of the Republic of Panama and of the Government of the United States of America; Whereas the Republic of Panama, by means of the ulebiscite stipulated by Article 274 of its Political Constitution, ratified the aforementioned Panama Canal Treaty; tJhereas the Senate of the United States of Aneric.i gave its advice and consent to the ratification of the Panama Canal Treaty with the following understandings and reservations: 143 (a) RESERVATIONS: (1) Pursuant to its adherence to the principle of non- intervention, any action taken by the United States of America in -the exercise of its ricrhts to assure that the Panana Canal shall remain open, neutral, secure, and accessible, pursuant to the provisions of the Panama Canal Treaty, the Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, and the resolutions of ratification thereto, shall bn only for the purpose of assuring that the Canal shall remain open, neutral, secure, and accessible, and shall not have as its purpose or be interpreted as a right of intervention in the internal affairs of the Rf^public of Paneuna or interference with its political independence or sovereign integrity. (2) The instruments of ratification of the Panama Canal Treaty to be exchanged by the United States of America and the Republic of Panama shall each include provisions whereby each Party agrees to waive its rights and release the other Party from its obligations under paraijraph 2 of Article Xtl of the Treaty. (3) Notwithstanding any provision of the Treaty, no funds may be drawn from the Treasury of the United States of America foe payments under paraqraph 4 of Article XIII without statutory autho- rization. (4) Any accumulated unpaid balance under paragraph 4(c) of Article XIII of the Treaty at the date of termination of th*; Treaty shall be payable only to the extent of any operating surplus in the last year of the duration of the Treaty, and nothing in such paragraph may be construed as obligatii^g the United States of America to pay, after the date of the termination of th« Treaty, any such unpaid balance which shall have accured before such date. 144 (5) Exchange of the instruments of ratification cif the Panama Canal Treaty and of the Treaty Concernir-.i the Permanent Neutrality and Operation of the Panama Cmal shall not he effective earlier than March 31, 15V), and i.uch ''reati'"; shall n>t eitcr into force prior to October 1, 1J79, ui.lri-s Ip'j isl.ition neccsd.ir ■• to im^leirent the provisions of the Pan.'ima i, ;n.il Ti.^aty shall has/'-- been enacted by the Congress of the United States of America before March 31, 1979. (6) Aftor the date of entry into force of the Treaty, the Panama Canal Commission shall, unless otherwise f^rovi(ie<'i Yy legis- lation enacted by the Congress of the United States of America, be obligated to reimburse the Treasury of the United States of America, as nearly as possible, for the interest cost of the funds or other assets directly invested in the Commission by the Government of the United States of America and for the interest cost of the funds or other assets directly invested in the predecessor Panama Canal Company by the Government of the United States of America and not reimbursed before tlie date o^ entry into force of the Treaty. Such reirr±)ursement for such interest costs shall be made at a rate determined by the So;.retary of the Treasury of the Pnited States of America and at .annual intervals to the extent earned, and if not earned, shall be made from subsequent earnings. For puiposei- of this reservation, tne phrase "funds or other assets direcMy in- vesLed" shall have the same meaning as the phrase "?lc^ direct investment" has under section 62 of title 2 of the Canal Zone Code, (b) UNDERSTANDINGS: (1) Bofore the first day of the three-year period beginning on the date of entry into force of the Treaty and before each three- year period following thereafter, the two Parties shall agree upon 145 the specific Ir^'els and quality of services, u;; are referired to in paragraph 5 of Article III of the Treaty, to he provided during the following throe-year period and, except for the first three-year period, on the reirbursement to be made for thf; costs of such services, such services to be limitet] to such as are essential to the effective functioning of the Canal operating areas and the housing areas referred to in paragraph S of Article III. If payments made under paragraph 5 of Article III for the preceding three-year period, including the initial three-year period, exceed or are less than the actual costs to the Republic of Panama for supplying, during such period, the specific levels and quality of services agreed upon, then the Panama Canal Commission shall deduct from or add to the payment required to be made to the Republic of Panama for each of the following three years one-third of such excess or deficit, as the case may be. There shall be an inde- pendent and binding audit, conducted by .m auditor mutually se- lected by both Parties, of any costs of services disputed by the t'vo Parties pursuant, to the reexamination of such costs provided for in this understanding. (2) Nothing in paragraph 3, 4, or 5 of Article IV of the Treaty r-.ay be construed to limit either the provisions of the first paragraph of Article IV providing that each Party shall a-t, in accordance with its constitutional processes, to neet danger threatening the security of the Panama Canal, or the provisions of paragraph 2 of Article IV providing that the United States of America shall have primary responsibility to protect and defend the Canal for the duration of the Treaty. 146 (3) Nothing in paragraph 4(c) of Article XIII of the Treaty shall be construed to limit the authority of the United States of /ijnerica, through th»^ United States Government agency called the Panama Canal Commission, to nake such financial derisions and incur such expenses an are reasonable and ncccbiiary for the management, oper.Ttion, and maintenance of the Panama Canal. In addition, toll rates established pursuant to paragraph 2(d) of Article III need not be set at levels designed to produce revenues to cover the payment to the Republic of Panama described in para- graph 4(c) of Article XIII. (4) Any agreement concluded pursuant to paragraph 11 of Article IX of the Treaty vxith respect to the transfer of prisoners shall be concluded in accordance with the constitutional processes of both Parties. (5) Nothing in the Treaty, in the Annex or Agreed Minute relating to the Treaty, or in any other agreement relating to the Treaty obligates the United States of America to provide any economic assistance, military grant assistance, security support- ing assistance , foreign military sales credits, or international military education and training to the Republic of Panama. (6) The President shall include all reservations and under- standings incorporated by the Senate in this resolution of rati- fication in the instrument of ratification to be exchanged v;ith the Government of the Republic of Panama. The Republic of Panama agrees to the exchange of the instru- ments of ratification of the Panama Canal Treaty on the understanding that there are positive rules of public international law contain«d in multilateral treaties to which both the Republic of Panama and 147 the United States of Ar\erii:a are Parties and whion consequently both States are bound to implement in aood fni. th, such as Article 1, para;sistancc, military gram assistance, security supporting assistance, foreign military sales credits, or international military education and training to the Republic of Panama. (5) The President shflll include all amendments, con- ditions, reservations, and understandings incorporated by the Senate in this resolution of ratification in the instru- ment of ratification to be exchanged with tlie Government of the Republic of Panama. The Republic of Panama agrees to the exchange of the instruments of ratification of the aforementioned Neutrality Treaty on the understanding that there are positive rules of public international law contained m multilateral treaties to which both the Republic of Panama and the United States of America are Parties and which consequently both States are bound to implement in good faith, such as Article 1, paragraph 2 and Article 2, paragraph 4 of the Charter of the United Nations, and Articles 18 and 20 of the Charter of the Orgdnization of American States. It is also the undi^rstanding of the Republic of Panama that Lhc actions which either Tarty may take in the exercise of its rights and the fulfillment of its duties in cjocordance with the aforesaid Neutrality Treaty, including measures to reopen the Canal or to restore its normal operation, if it should be interrupted or obst-ructed, wiJl be effected in a manner consistent with the principles of mutual respect and cooperation on which the new relationship established by that Treaty is based. 165 The Republic of Panama declares that its political independence, territorial inteqrity, and self-determination are guaranteed by the unshakpablc will of the Panamanian people. Therefore, the Republic of Panama will reject, in unity and with decisiveness and firmness, any attempt by any country to intervene in its internal or external affairs. The Head of Government of the Republic of Panama, availing himself of the powers granted by Article 277 of the Constitution, after having considered the aforementioned Neutrality Treaty, hereby ratifies it and, in the name of the Republic of Panama, undertakes to comply with it faithfully. In witness whereof, this instrument of ratification is signed by the Head of Government of the Republic of Panama. DONE at I anama City, Republic of Panama, this sixteenth day of June 1978. Omar Torrijos Herrera 166 Mr. NoNNEXMACHER. Thank you. I have only one last question, Mr. Ambassador. In view of the possibility that the House of Kepresentatives may find the implementing legislation not to its liking, could you give us some idea of what the administration would do if that implementing legislation fails of passage, or let us say, some major sector of it, such as the structuring or establishment of the Panama Canal Com- mission, let us say, should fail of passage ? Let us say, if there should be a deadlock over here in the Congress on the matter. What would the administration do, in your opinion? Ambassador Popper, Again, it is rather difficult to speculate on such circumstances. The Executive Branch is clearly able to do some things without legislation, but it cannot, obviously, do everything without legislation. There certainly would be constraints on the fi- nancial side and in many other respects. I could not say at this time how far it would be possible to go if the legislation were not com- plete in all respects. I would like to envisage such a situation, if it ever arose, as being susceptible of proper handling by the two branches of Government, the executive and the legislative, in close cooperation so as to deal with an emerging situation which obviously carries within it the seeds of embarrassment for the Government of the United States. I do not think members of Congress want that. I know the execu- tive branch does not want it. I would like to believe that ways can be found to do what we are now committed to do, at the time when the implementing legislation would normally go into effect. Mr. NoNNENMACHER. Thank you very much. Ambassador, and you, Mr. Wyrough, and thank you, Mr. Chairman. Mr. Metcalfe. Thank you. The Chair now recognizes Mr. Tannenbaum for any questions that he may desire to ask. Mr. Tannenbaum. Yes, thank you, Mr. Chairman. I do not want to go far afield from the purpose of the hearing today, but in furtherance of the question to which you just re- sponded, does the State Department intend to respond to the Pana- manian Foreign Minister's interpretation of the amendments and reservations? Have we prepared an analysis whereby our interpre- tations of such amendments and reservations might differ from the Panamanian Foreign Ministry, with a view, of course, to reconcil- ing these differences so as to avoid any further and future conflicts? Ambassador Popper. Our interpretations, Mr. Tannenbaum, have been spread upon the record on very many occasions, and in very many ways, particularly with respect to what I might call the gut question of the freedom of the United States to take any action re- quired to keep the canal open after the year 2000. Our ideas are so fully spread on the record that I really feel there is no doubt whatever as to what our views are. The Government of Panama is perfectly conversant with them. They are contained in the Senate reservations and observations and conditions. I do not think any useful purpose would be served by belaboring this point further, and we have no present intention of doing so. Mr. Tannenbaum. Well, except for the fact that you say this is the Panamanian Foreign Ministry's interpretation, is not a legal 167 document. Having read it, it appears to be a legal document, and certainly is an official position of the Panamanian Government, and that being so, to the extent that it might differ from our interpre- tation, should that not be clarified at this stage, or possibly even clarified by the implementing legislation? Ambassador Popper. As I said, the positions seem to me perfectly clear. I think they provide a firm basis for working together, in co- operation, to put the treaties into effect and to carry out their terms through the year 2000 and beyond. I just simply do not believe that we would advance the national interest by proceeding further down the path of dissecting every statement made on either side and projecting possible bases of dis- agreement to the end of long, rather supposititious lines of conduct. This does riot seem to me to be a profitable way to set the stage for this great enterprise on which our two countries are embarking. I believe we can work within the framework of the existing posi- tions, and the Panamanian Government obviously believes the same thing. For that reason I would rely upon the legal documents — the treaties, the instruments of ratification, and the like — and proceed in good faith to work out any problems that arise as we move ahead. jNIr. Tannenbaum. Just one final question on this issue. I am fairly conversant with the treaty, and I find that I am some- what confused as to some of these interpretations, as to which is the real interpretation of a provision. And since the whole purpose of the treaty was to avoid conflict and to clean the slate and start anew, would it not be better if we started anew without any differences on the interpretations, and if we clarified these things at the current time rather than wait for a future conflict ? Ambassador Popper. I appreciate your viewpoint, Mr. Tannen- baum, as you have expressed it. I think we disagree on this. ]\Ir. Tannenbaum. All right. With regard to the sea-level canal, does the State Department have a position as to the feasibility, practicality and advisability of a sea-level canal at this stage ? Ambassador Popper. No, we do not. Mr. Tannenbaum. Would you elaborate upon the treaty commit- ments of the United States in connection with the use of nuclear power or explosives in the Western Hemisphere, and how such com- mitments relate to nuclear excavation of a sea-level canal? Ambassador Popper. May I say a few words, and then ask if I can elaborate my response by a statement for the record? We are a signatory of a protocol to the Treaty of Tlatelolco. We are a participant in the Nuclear Test Ban Treaty and the Non- Proliferation Treaty. All of those run in the direction of restricting nuclear explosions, including the use of nuclear explosives for peace- ful purposes. We are acutely aware of the dangers to the environ- ment and the other harmful effects of radiation, et cetera. We are equally aware of the danger of contributing to the proliferation of nuclear weapons through the use of explosives — nuclear explosives — for other purposes. For that reason, since the 1970 report, was issued, we have swung, if anything, still farther away from the thought of using nuclear explosive devices for canal construction. 168 I would like, if I might, to expand on this answer with more definite details in writing. Mr, Metcalfe. Thank you. The record will remain open so that you may expand, Mr. Ambas- sador, within, say, the next 5 days. Is that unreasonable? If you could comply within 5 days, we would appreciate it. Ambassador Popper. Certainly. [The following was received for the record :] Use of Nuclear Explosives While the United States is not legally prohibited in international law from the use of peaceful nuclear explosives for such purposes as the construction of an interoceanic sea-level canal, US policy does not now contemplate such use. The Comprehensive Nuclear Test Ban Treaty which we are now negotiating with the USSR and tlie United Kingdom would, if signed and ratified, cate- gorically preclude the use of nuclear explosives for construction of a canal. The Treaty of Tlatelolco, to which we are a signatory of the protocols, would not prevent our carrying out a peaceful nuclear explosion for the benefit of the parties concerned. Mr. Metcalfe. Thank you. Mr. Tannexbaum. Thank you very much, Mr. Ambassador. ]Mr. Metcalfe. Thank you very much, Mr. Ambassador. Before you leave this hearing, the Chair wishes to state that we recognize the importance of the treaty implementing legislation. It is my hope that the Subcommittee will be able to hold exhaustive hearings and deal with such legislation with the appropriate dis- patch. I want to assure you that we thank you gentlemen for appearing. Ambassador Popper. Thank you, Mr. Chairman. [The following was submitted for the record :] Questions of Mb. Nonnenmacher and Answers by Ambassador Popper (The attached very pertinent presentation "Deforestation — Death to the Panama Canal" was made by Frank H. Wadsworth, Institute of Tropical For- estry. Forest Service, U.S. Department of Agriculture, at the U.S. Strategy Con- ference on Tropical Deforestation, June 12-14, 1978, in Washington, D.C., sponsored by the Department of State and the Agency for International Development. ) Deforestation— Death to the Panama Canal (By Frank H. Wadsworth, Institute of Tropical Forestry, Forest Service, U.S. Department of Agriculture) The world's most important ship channel must be the Panama Canal. Nearly 15,000 ships pass through it every year. Its width and depth dictate the design, dimensions and cargo displacement of much of the world's merchant fleet. It reduces ocean shipping distances up to 10,000 miles. The recent Panama Canal treaty, providing for relinquishment by the year •iOCK), reflects no decline in our interest in the Canal, but the conviction that, at Panama's request, the Canal should be administered by its sovereign nation. the canal in jeopardy The capability of the fresh water supply of the Canal to continue to meet growing demands has been taken for granted. About Mi of the water of Lake Gatun is used to generate hydroelectric power. Additional water from this lake and from the tributary reservoir, Lake Alajuela, serves for urban uses in the Canal Zone and the cities of Panama and Colon. 169 The passage of each ship releases 52,000,000 gallons of stored fresh water to the sea. This u.se disposes of more than half of the runoff from the watershed. Nevertheless, a third, larger set of locks is under discussion. It would of course require an even greater amount of fresh water for each additional passage accommodated. Land use within the tributary watersheds has also reflected confidence in the capability of the Canal water supply to meet growing demands. Originally cov- ered with dense rain forests and still 85 percent forested as recently as 1952, some 250,000 acres, or 35 percent of the Canal watershed, have since been de- forested, burned, and cultivated or pastured. The delineation and management of the Canal Zone also reflects this same confidence in the continuing capability of the Canal to s:^rve its many purposes. The boundaries of the Canal Zone have never included the headwaters that feed Lake Gatun. Not only these headwater.s. but even parts of the Zone itself have in recent years been deforested. Apprehension of trespas.sers in the Zone by the T'nited States is now complicated by criticism in the Panamanian press. The passage of more ships, increa.sed use of water for hydroelectric power and for the domestic .supplies of growing cities, and the production of timber, food, and forage crops, within the Canal watershed led to a dramatic demonstration of the limits of the capability of the water system in May 1977. The surface of Lake (Jatun dropped to 3.1 feet below the level required for full Canal use. Some ships sent part of their cargo across the isthmus by land, reloading it at the other end. Certain bulk cargo shippers even abandoned the Canal, .sending very large cargo carriers around the Horn. The 1977 predicament coincided with a serious drought, but this was al.so a harbinger of what could soon take place every year. Water consumed for power and domestic needs drains the lake. Deforestation and cidtivation of the head- waters accentuate both flood lo.sses through the spillway and low flow in the dry season. Lake Alajuela has been sedimented by deforestation to a depth of 25 feet in some places, and has already lost more than 5 percent of its active storage capacity. Current land use trends will, by the year 2000, sediment about 40 per- cent of the storage capacity of Lake Alajuela. This would mean further losses to phipi)ing due to widely varying draft tolerances and drastic fluctuations in water availability for power or urban use. Several solutions to these growing water problems have been considered. Re- moval of sediment from a reservoir the size of Lake Alajuela is not considered feasible. Raising Madden Dam by 10 feet is physically feasible but at best would only delay the crisis. The 5 additional reservoir sites existing in the watenshed could only replace the active storage capacity being lost at Lake Alajuela and would themselves al.so become sedimented. Tunneling water from an adjacent watershed could increase the water supply but also sedimentation because adja- cent watersheds are deforested also. The pumping of seawater into Lake Gatun involves risks of introducing Atlantic organisms into the Pacific. None of these proposals is more than a palliative. None offers more than a temporary reduction in the rate of deterioration. It is only forests that can re- store and stabilize the capacity of the Canal. Even if Madden Dam were raised, the 5 additional dams were built, fresh water were tunneled from el.se where, and power and urban water consumption were discontinued completely, the effects of continued deforestation would be inexorable, sooner or later meaning death to the Canal as a reliable world trade route. The most critical remaining area of primary forest covers some 225,000 acres in the rainy headwaters of the Chagres and adjacent subwatersheds tributary to Lake Alajuela. It provides about 40 percent of the water for the entire Canal watershed. It is now being invaded by shifting cultivators. SIGNIFICANCE TO THE UNITED STATES Unless corrective action is taken immediately a major, irreversible decline in the utility of the Canal can be expected to take place during the incumbency of the United States as operator of the waterway. It would of course also take place after we have agreed to transfer the Canal to Panama. What we transfer may have become a worthless ditch, a colo.ssal monument to resource mismanagement. However fortuitous the timing, could we deny that we had fore.seen the trouble and not forestalled it? Could we point to the fact that we do not control the criti- cal headwater areas outside the Canal Zone while the Zone itself is being de- 170 forested under our very noses? Would we really have had no part in the debacle? Clearly the diplomatic problems in prospect could transcend those which brought on the recent treaties. SUGGESTED COURSE OF ACTION The most urgent step to save the Canal is the immediate halt of deforestation of the watershed, particularly in the valleys of Rios Chagres, Pequenf, Boquernn, and Indio. The capacity of these remaining rain forests to control soil and water movement is almost irreplaceable. Of nearly equal urgency is the discontinuation of cultivation and pasturing and the reforestation of an additional 240,000 acres of steep lands. A rational program of land use will also call for more intensive use of some 150,000 acres suitable for agriculture as a hasis for employment of the 10,000 rural families living within the watershed. These watershed control practices are needed chiefly outside the Canal Zone. Leadership for this program must come from Panama. Even the forests within the Canal Zone can no longer be protected without the support of Panamanian authorities. Since operation of the Canal in the immediate future is in jeopardy it seems more than logical that the United States share with Panama the costs of needed conservation, watershed management, and rural development. USAID has for some months been developing a 5-year watershed management program with the government of Panama. The proposal is to develop the Depart- ment of Renewable Natural Resources (RENARE) within the Ministry of Agri- culture, with emphasis on the protection and development of the Canal watershed. An AID project may start a program to protect the Canal, but it could well fall short in one critical aspect : continuity. The long-time assurance of adequate water for the Canal should not have to rely on extraordinary financial allotments made from time to time by the two governments. What is needed is an assured continuity which would sustain a cadre of well-trained career-oriented personnel. If the future of the Canal is at stake should not management of the watershed be a proper and high priority use of Canal fees? These, said to amount to $300 millions annually, are used in part for other types of Canal maintenance, such as dredging the channel. A flat percent of gross Canal fees would presumably rise with inflation and thus assure long-term support. Matching of fee allotments by the Panamanian government might be desirable, but if required could intro- duce an element of uncertainty into the program which must be avoided. After all, if the program were supported entirely from Canal fees before the year 2000 it would have no adverse financial impact on Panama thereafter. The recently signed Panama Canal Treaty provides in Article VI for a Joint Commission on the P^nvironment, representing both governments, which might oversee the watershed program between now and the year 2000. No Treaty pro- vision, however, appears to support or staff the Commission. The channeling of funds from Canal fees for the operation of this Commission and through it to the watershed management program of RENARE, could provide continuity and involvement of both governments. The Commission might utilize USAID as a source of technical support. A continuous watershed protection and management program led from within the Panamanian government seems under the critical circumstances that prevail to be a minimal obligation of the United States. It could assure preservation of the Canal as a world resource during our period of its operation and make pos- sible its continued utility for an indefinite period thereafter. Question 1. Please detail what the State Department has done in recent years to get the Government of the Republic of Panama to initiate or cooperate in projects which would put an end to the deforestation cited by Mr. Wadsworth as inimical to the continued operation of the Panama Canal. Do you agree with Mr. Wadsworth's conclusion that : "... A continuous watershed protection and management program led from within the Panamanian government seems under the critical circumstances that prevail to be a minimal obligation of the United States . . ."? Answer. The Embassy has worked closely with the Canal Company and the Southern Command in calling attention to the deforestation problem and its adverse effects on Panamanian interests and the operation of the Canal. During the last decade, there have been several joint United States-Panamanian opera- tions to remove from the Canal Zone squatters engaged in slash and burn agri- 171 culture. Planning for a similar cooperative action is now underway. The Em- bassy will continue to arrange for Panamanian cooperation and participation in these effects. The Department agrees with Dr. Wadsworth on the need for a continuous watershed protection and management program in the Canal basin. Active Pana- manian leadership will be vital to the success of such a program. United States agencies in Panama currently are engaged in developing with Panamanian offi- cials both short and long-term programs for the protection and renewal of the Canal watershed. Question 2a. Former Panamanian President, Anulfo Arias, who has recently returned from exile to Panama, has been publicly condemning the treaties— which provide for a Sea Level Canal Study — as harbingers of new problems and frictions between Panama and the United States. In view of the enormous public support which Arias has in Panama, does the Department of State see any likeli- hood of a second plebiscite on the treaties that might end in rejection of the treaties as amended by the Senate? Answer. Both the United States and Panama consider that the two countries have completed the political and constitutional processes required to bring into effect the Panama Canal Treaties. The instruments of ratification for the Canal treaties which were delivered on June 16 are scheduled to become effective on April 1, 1979, unless tlie Congress completes the implementing legislation accord- ing to a schedule that would permit an earlier effective date. The treaties, there- fore, are valid and binding under international law and are not subject to uni- lateral change or rejection. Question 2b. Has the Department taken official note of Arias' criticisms of the Treaty ? If so, please forward to the Subcommittee. Answer. Dr. Amulfo Arias is a private citizen of the Republic of Panama, and consequently the Department of State has not taken official note of his com- ments concerning the Treaties. Question 3. Senator Gravel, in his testimony, said that a sea level canal Avould be Panamanian if on Panamanian soil or Nicaraguan if built in that country. Then he said : "The other aspect of this now, since we have settled who is going to own it poltically, is how are you going to do it commercially. It is no big deal. If this tTiing washes economically, we can build it with U.S. guarantees, and if the Ignited States does not want to guarantee it. the Japanese would guarantee it, the Germans will guarantee it, and the Saudi Arabians would be happy to invest their money. They do not have an intelligent place to invest the billions that we are giving them, and this is the kind of an investment, in real estate, that is the only sizable hedge against inflation that an investor can have." The journal of Commerce for June 27, 1978, carried a story entitled : "Panama Seeks $300 Million Debt Rollover" by A. Koffmann O'Reily, in which the re- ported quoted Henry R. Geyelin, President of the Council of the Americas as saying : "The former Canal Zone is a big piece of real estate coming into the market in the new (sic) few years. Consequently, there A^ill be a whole range of new business opportunities for U.S. companies, including direct investment." I am intrigued by the fact that these two gentlemen speak so enthusiastically of investing in the "big piece of real estate" comprising what the new treaties would make of the "former" Canal Zone. Since the American taxpayers will he giving away this real esitate, I would appreciate the comments of the State De- partment on the statements of Senator Gravel and Mr. Geyelin. Specifically, I would like you to detail "the whole range of business opportuni- ties for U.S. companies, including direct investment" opened up in the Canal Zone by the new treaty. Answer. Under the treaty, the United States ^^•ill return to Panama all land that is not needed for the operation, maintenance and defense of the Canal. Panama has an obvious interest in the development of this land for economic and social purposes. While Panama's development plans are still in the forma- tive stage. Panamanian officials have stated that private enterprise will play a substantial part in this development. I must assume that such activity would not be limited to domestic firms in Panama but would be available to involved foreign concerns, including American companies. 32-461 O - 78 - 12 172 The Government of Panama has indicated its intention to open up some of this land to private investment in an effort to develop new sources of growth and generate employment for the Panamanian people. There have been indica- tions that Panama intends to use some of the land for commercial and indus- trial expansion. Panama has already obtained financing for the expansion of Ihe Colon Free Zone, the building of a container port, and the utilization of dry docks for ship repair and maintenance. Some areas will be dedicated to urban expansion and housing programs and recreational purposes. For further infor- mation I refer you to a working document entitled "El Desarrollo Nacional y La Becuperaeion de la Zona Del Canal de Panama" published by the Panamani- an Ministry of Planning in June of this year. Question J/a. Please detail the specifics of the $300 million debt rollover by Panama. Answer. In order to reduce .scheduled 1978-83 amortization payments of ap- proximately $300 million, the Government of Panama negotiated with the Bank of America and Citibank in June of this year for a loan for $300 million. The funds will be used to rollover the debts from six loans (detailed below) which would have required the following amortization payments : Approximately $66 million annually over each of the next four years, $37 million in the fifth year, and $8 million during the sixth and final year. Since the new ten-year loan has a grace period of three and a half years, the Government of Panama can now reduce its total amortization payments by $66 million during each of the first three years. After the fourth year, Panama's payments will increase, since the $300 million is to be repaid ten years from the time the loan is drawn. There is no clear advantage or disadvantage of significant to the Government of Panama in terms of interest rates as a result of this refinancing, since the average rate on the six loans being paid off appears to be about the same as the rate on the new loan. Question Jfb. How is it that it just equals the economic package offered Pana- ma collateral with the Treaties? Answer. There is no significance to the similarity in totals for the new loan and the economic package. The economic package consists of up to $200 million in Export-Import Bank credits, up to $75 million in A.I.D. hou.sing investment guarantees, and up to $20 million in OPIC loan guarantees for borrowing by the National Finance Corporation of Panama. The package cannot be used for debt refinancing. It is targeted for specific products and programs subject to review and approval by the United States lending institution in accordance with their standard criteria. Question 4c. Is this short-term indebtedness? Answer. The new loan is for ten years, to be repaid in 14 semi-annual install- ments starting 42 months after drawdown. The agreement was signed in June and early drawdown is expected. Question Jfd. Please specify the exact date or dates the $300 million would have been due and to which banks or government agencies. How much would have been principal and how much would have been interest due? Answer. A breakdown of the $300 million due at the end of June, 1978, is shown in following table. Interest Term rate Original Balance, (grace) (Labor, amount June 30, 1978 Lender (years) plus) (millions) (millions) Consortium (1973) Consortium (1973), Citicorp (1974) Bank of Tokyo (1974). _.. Consortium (1975) Consortium (1976) Question JfC. How much does Panama owe United States banks, other inter- national private banks, United States Government agencies, quasi-governmental agencies and lastly foreign governments? Answer. As of year-end 1977, the Government of Panama's total outstanding debt was $1.76 billion. A growing percentage of the debt consists of relatively short-term foreign bank borrowing with an average maturity of around eiglit 10(2) 1.5 $65 $43.3 10(4) 1.25 115 105.0 10.4 1.125 36 36.0 10(3) 1.25 12 11.0 8(2) 1.75 45 30.0 /(2) 1.75 80 80.0 173 years. At the same time loans from international financial institutions have de- creased as a percentage of total debt. A breakdown of the total debt shows that : Twenty percent or $356 million is owed to United States banks ; Thirty percent or $534 million is owed to other foreign banks ; Ten percent, or $185 million is long-term indebtedness to international finan- cial institutions ; i.e. as IDB and IBRD. Eight percent or $143.8 million is owed to the United States Government, as of September 30. 1977, and the Government of Panama had guaranteed $2 mil- lion of United States Government loans to private Panamanian borrowers. The Government of Panama's debt to foreign governments is a very small part of the total outstanding debt. Mr. Metcalfe. The next witness will be Lieutenant General W. G. Dolvin, U.S. Army, retired. Lieutenant General Dolvin, who appeared before the subcommittee during the Panama Canal Treaty ratification hearings last year, has since October of 1975 been a key negotiator from the Department of Defense for the Panama Canal Treaty negotiations. He currently serves as Department of Defense representative for Panama Canal Treaty affairs. General Dolvin is joined today by Colonel Clyde A. Selleck, exe- cutive director of civil works, Office of Chief of Engineers U.S. Army, and Commander Anthony W. Gray, politico-military divi- sion. Office of Chief of Naval Operations. General, we are so happy to have you present with us again and also we are happy to have these fine gentlemen that you brought with you today. You may proceed, please. STATEMENT OF IT. GEN. WELBORN G. DOLVIN, U.S. AEMY (RET.), DEPARTMENT OF DEFENSE REPRESENTATIVE, PANAMA CANAL TREATY AFFAIRS; ACCOMPANIED BY COL. CLYDE A. SELLECK JR., EXECUTIVE DIRECTOR, CIVIL WORKS, OFFICE OF CHIEF OF ENGINEERS, U.S. ARMY; AND COMDR. ANTHONY W. GRAY, JR., ASSISTANT BRANCH HEAD, WESTERN HEMISPHERE, POLITICO- MILITARY DIVISION, OFFICE, CHIEF OF NAVAL OPERATIONS General Dolvik. Thank you, Mr. Chairman. It is a distinct pleasure to appear once again before this distin- guished committee. I am representing the Department of Defense, and I will try to address those questions dealing wth defense and some of the more technical aspects of the question before the com- mittee. And, Mr. Chairman, as you said, I am accompanied by Colonel Clyde A. Selleck, Jr., who is executive director of civil works, Office of the Chief of Engineers, and Commander Anthony W. Gray, Jr., from the Navy staff. The military value of a .sea-level canal connecting the Atlantic and Pacific Oceans is greater than but similar to the importance of the existing canal system. Its principal strategic military advantage would lie in the economy and increased flexibility it would provide in moving military cargo and foices and logistic support by soa to overseas areas. Like the Panama Canal, use of a sea-level canal would enhance our capability for timely reinforcement of U.S. Forces. 174 A sea-level canal would have two advantages. First, a sea-level canal would be considerably less vulnerable than the present canal with its extensive and intricate locks system. Second, it could ac- commodate all of our naval ships plus some of the outsized tankers that are either in use today or are presently under construction. Presently, it takes our large aircraft carriers an additional three weeks and 8,000 miles to circumnavigate South America. All U.S. Xavy ships, except the 13 large aircraft carriers, can transit the Panama Canal. There would be no near term impact on the impor- tance of a sea-level canal by new construction of small type ships l)ecause largo Ximitz-class aircraft carriers will be in existence for [at least] the next -15 years. In order to determine the feasibility of achieving the advantages of such a canal and in order to weigh the pros and cons, it is clear that the "1970 Interoceanic Canal Study*' should be updated at sometime in the future. As you know, article XII of the recently ratified Panama Canal Treaty requires such action. Paragraph 1 of the article states that — and I quote : Consequently, during the duration of this treaty, both parties commit them- selves to study jointly the feasibility of a sea-level canal in the Republic of Panama, and in the event they determine that such a waterway is necessary, they shall negotiate terms, agreeable to both parties, for its construction. Now, there have been sufficient political, economic and transporta- tion developments in the past 8 years to warrant a reevaluation of the need for and the desirability of additional canal capacity during the treaty period. Any new study should undertake two major tasks. First, priority should be given to a joint United States-Pana- manian study of factors affecting the feasibility of expanding the present canal or constructing a sea-level canal in Panama. This joint effort should be accomplished in keeping with our treaty commit- ments with Panama and restrictions related thereto. Second priority should be given to alternate routes outside of Panama. I might add that any legislation on this subject should pro- vide the executive authority to establish the Study Commission and appoint its membership. I would now like to amplify these remarks by reviewing the con- clusions of the 1970 study, estimating new canal construction costs and identifving the tasks to be performed in any study update. Public Law 88-609, 88th Congress, September 22, 1964, authorized the President to appoint a commission to study an Isthmian Sea- Level Canal connecting the Atlantic and Pacific Oceans. The study of engineering feasibility was directed by the Army Corps of Engi- neers in coordination with the Atomic Energy Commission and the Panama Canal Co. The study, which was completed in Xovember 1970, concluded that construction of a sea-level canal was feasible using conventional construction methods and that the most suitable site for such a canal would be approximately 10 miles west of the existing Panama Canal. The proposed sea-level canal would be 550 feet wide and have a minimum depth of 75 feet. A depth of 85 feet would be available along the centerline of the canal. The land cut would be 36 miles long and the sea approaches would be 17 miles 175 long. The canal is designed to accommodate vessels up to 150,000 deadweight tons. However, vessels up to 250,000 deadweight tons could transit under controlled conditions. In 1970, the Commission estimated the cost to be $2.88 billion for construction and $24 million for real estate. Comparable costs at April 1977 price levels would be approximately $5.9 billion and $43 million, respectively. Provisions of a future bypass to al- low two-way traffic was estimated to cost $460 million in 1970 and would cost $828 million at current prices. Thus, the total estimated cost for a sea-level canal Avould be approximately $6.16 billion at April 1977 prices. The 1970 Commission report recommended that the President reevaluate the need for the desirability of additional canal capacity based on conditions subsequent to 1970. We now esti- mate such a study would cost $8 million and would require 3 years to complete with the following funding: First year, $1.5 million; 2d year, $4 million ; 3rd year, $2.5 million. The following tasks should be performed in any reevaluation of the need for a sea-level canal. First : Update shipping study including transportation economics. Review existing and prospectiv^e ship sizes, including technological changes. In addition, commodity movements in the world market should be reanalyzed, projection of world supply and demand for various commodities will be prepared based on world conditions that have changed since 1970, including cessation of the Vietnam hostili- ties, development of North Slope oil, the current energy crisis, et cetera, and the cost is estimated to be $2 million. Next, review potential environmental effects. In view of the in- creased consideration being given to environmental quality since preparation of the 1970 report, considerable effort will be required to ascertain the potential environmental consequences of canal con- struction and possible mitigative measures that are needed. Consid- erable literature research should be done as well as studies of the marine and terrestrial biology of the area, some field reconnaissance will be required. Assistance from ether Federal and local national agencies would be required, and the cost is estimated to be $3 million. Second : Review of the 1970 engineering findings and recommen- dations. Engineering studies should be updated to include a reanaly- sis of existing topographic and hydrographic data. Cost estimates and equipment needs which will be restudied to include the latest techniques and procedures for massive excavation and placement of material. Some field work will be required, and the cost is estimated at $2 million. Third : Contingencies. Based on the many unknown factors that may arise in a study outside the continental limits of the United States, a contingency factor of 15 percent has been included at a cost of $1 million. In summary, the Department of Defense would support legislation to update the "1970 Intercceanic Canal Study" when such action is agreed to by both the ITnited States and the Republic of Panama. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you very much. Gentlemen, how will the Defense Department propose to communi- 176 cate to the sea-level canal commission its view of the national secur- ity factor in a sea-level canal ? General Dolvin. "Well, Mr. Chairman, we would hope to be con- sulted on the Defense aspects as the stud}^ is made, and give our professional judgment as the study progressed. Mr. Metcalfe. I gathered that leally from your testimony. General, should there be an advisory council for the Sea-Level Study Commission, or would tliat be inappropriate in a joint body that includes Panamanians^ General Dolvin. Mr. Chairman, I am not quite sure I understand the thrust of your question. Mr. Metcalfe. Should there be an advisory council for the Sea- Level Study Commission, or would that be inappropriate in a study commission, in a joint body that includes Panamanians? In other words, this would be a superstructure over the two gov- ernmental bodies? General Dolvin. I would think that there would be no objection to Panamanians serving on an advisory council. I believe the Pana- manians should be in on this study at all levels. ]Mr. Metcalfe. I think the advisory council would be more techni- cians, including, of course, some personnel from the Army, the Army Corps of Engineers. It would certainly General Dolvin. Panama does have some people that are quite competent in the technical field. I think they would expect to partici- pate in some meaningfid way in any study involving the canal. Referring to the second part of that question, I stated in my testi- mony that the technical parts of the 1970 study w^as done by the Corps of Engineers. I w^ould expect that the Corps of Engineers W'Ould be the logical choice to participate in the technical part of the update. Mr. Metcalfe. Could you tell us as specifically as possible why the 1970 study concluded that a sea-level canal is less vulnerable than the existing canal? General Dolvin. Yes, sir. The sea-level canal does not have the locks. These are critical in- stallations which must be protected. The Sea-Level Canal is wider and not as easy to destroy in the first place. And, secondarily, it is easier to clear if it is obstructed. From an operational standpoint, the situation is different. Damage to sea-level canal would not have the lasting effect as would occur, for example, if you blew Gatun Dam and lost all the water. It would take years to refill. A sea-level canal, as you know from the Suez experience, can be put back in operation a lot easier and quicker. A sea-level canal does not have as many sensitive places to defend. Mr. Metcalfe. General, wdiat is the Defense Department's view on the relative merits of the third locks modernization proposal com- pared to the sea-level canal? General Dolvin. I call on my technical expert from the engineers to correct me if I'm wrong. JNIr. Chairman. The studies I have seen just do not equate a third lane lock as be- ing a good solution. First of all, it is a matter of depth of the canal 177 and, second, it is a wa.ter matter. And water already is short in the dry season for tlie present canaL A third lock of the size that I have seen in studies would require 100 million gallons of water per ship rather than 52 million as we currently need. So I think technically a third lane of locks does not measure up against the requirement for a sea-level canal. Is tha-t about right? Colonel Sellegk. Sir, I would agree with that basically. The locks, third lock modification, would just be a limited enhancement of the current canal. It would not generate the major benefits of the sea- level canal. Mr. Metcalfe. Thank you, colonel. One final question. In the view of tlie Defense Department, how long will it take to construct a sea-level canal across Koute 10 or any other major routes studied by the Atlantic-Pacific Commission'? General Dolvix. I think, Mr. Chairman, that probably would be a matter that the study would develop. Maybe Colonel Selleck would like to give his professional judgment on that Colonel Selleck. Our preliminary estimate is that it would take about 1-1 years for actual construction. Mr. Metcalfe. Thank you. Mr. Modglin? Mr. MoDGLix, Just one question, Mr. Chairman. The Panama Canal Co. with a canal at many places that has a 500-foot wide channel, designates, as a rule of thumb, that there has to be one-way clear-cut traffic for vessels that have a beam of 85 feet or greater. And clear-cut traffic, that is one-way traffic, is con- sidered if there is a vessel transiting the canal that has a beam of 82 feet. Many of the vessels that will be transiting a sea-level canal — if my estimates are correct — if they are large tankers of, say, 250,000 tons, would have beams of up to 150 feet or so. The channels for a sea-level canal, as estimated in the 1970 study, would be some 550 feet or 600 feet wide, just somewhat larger but not a great deal larger than the present channel of the present Panama Canal. I would like your comments — from the colonel, in particular — on the question of whether or not there would be severe navigational and operational problems with a nmch longer constricted channel, and a channel that is only slightly larger than the present canal channel, if we had a sea-level route? Colonel Selleck. The details of the final design, of course, would depend on a great deal more study than has been done now. It is anticipated that, based on the 1970 study, that for essentially one-way traffic for the conce])t worked out then, vessels up to about 150,000 deadweight tons could be accommodated on a fairly normal basis. A 250,000 ton displacement vessel would require exceptional means, ad- ditional tugs, to insure a safe passage. Mr, MoDGLix. In testimony before the committee. Senator Gravel's estimates of the feasibilitv of transmitting Alaskan oil through the 178 canal were based upon transit of oil in tankers of about 265,000 tons through a sea-level canal. Could you provide for the record whether or not the 1970 report envisaged the possibility of transit of vessels that large through the sea-level canal? Colonel Skixkck. We can amplify the response for the record. It did speculate that vessels up to 250,000 deadweiglit tons would be accommodated under exceptioiuil conditions. We will amplify that for the record, Mr. Chairman. INIr. MetcaivFe. Thank you. [The following was received for the record:] Transiting of a 265,000 DWT .Ship Can a 265,000 deadweisht ton ship transit the proposed sea-level canal? The 1970 Interoceanie Canal Studies of the Atlantic-Pacific Interoceanic Canal Study Commission report that the proi)i)sed sea-level canal would lie capable of transiting 250.000 dwt ships. It is my opinion that the sea-level canal could also accommodate a 265.000 dwt .ship under suitably controlled conditions. Overall dimensions of a typical 265.000 dwt ship would require about 2 feet more draft, would be about 20 feet longer and about 6 feet wider than a typical 250,000 dwt ship. Mr. Metcalfe. Mr. Nonnenmacher, do you have any questions? Mr. NoxxEXMACiiER. Yes, sir. General Dolvin, it is good to have you back again. I appreciate the point you made in the statement to the eflfect that there would be no near term impact on the impoi-tance of the sea-level canal by new construction of smaller ships, because large aircraft carriers will be in existence for the next 45 years. I appreciate that because I had asked your people in advance of the.se hearings that there be some clarification of this matter by the Defense Department. The sentence, however, raises the question that I would like to ask Commander Gray as a naval officer, what is the average age of ships in the fleet today ? Are there ships 45 years in service ? Commander Gray. Sir, this figure of 45 years is based upon the 30-year nominal life for aircraft carriers, the Forrestal-class car- rier, for example, plus a 15-year service life extension program, which would bring it to 45 years. This i^oint was made, I believe, in Admiral Holloway's most re- cent posture statement and these figures were transposed over to the Nimitz-class carrier. We do have some ships which are approaching that age in our inventory. But, as I say, those 45 years were cal- cidated for the aircraft carrier. Mr. NoxxEXMACiiER. Without going into a great deal of detail, and with tlie proviso that you submit additional material, could you give us a capsulized concept of what the Navy's thinking is toward the size and speed of future vessels, of all categories? I have some understanding about hydrofoils and smaller and faster craft coming to the fore. Is that correct or am I misinformed on that ? Commander Gray. Yes, we have concepts for various types of newer class ships. However, I would have to defer on that, sir, and provide a response for the record. I do not feel qualified to delve into that. 179 Mr. NoNXEXMACiiER. Well, this point concerning the terms of usage for the aircraft carriers is a very inipoi-tant one. We know of the debates in the Senate on the midi-carriers versus the Ximitz carriers. In other words, it is quite clear that the large carriers will be with us for quite some time regardless of the size of any new ones. Commander Gkay, Yes. sir. Mr. NoNNEXMACiiER. Could you give us the dimensions of the Nimitz carrier? Commander Gray. T would have to provide that for you, sir. But the Nimitz-class carrier could be easily accommodated in a sea-level canal. It could not be accommodated by the proposed third set of locks. So it could not be accommodated, say, by just this additional set of locks. It would require the sea-lev^el canal and could easily be ac- conmiodated in it. [The following was submitted for the record :] Size and Speed of Ships One effort the Navy has underway which addresses sizes and speeds of future ships is the Advanced Naval Vehicles Concepts Evaluation (ANVCE). It was brought about by realization that rapidly increasing cost coupled with decreas- ing proportion of the gross national product being devoted to the defense budget makes the problem of balancing present needs with introducing advanced tech- nologies more ditficult than ever. The ANVCE Project seeks to determine wheth- er new technology areas for naval vehicles offer greater mission effectiveness or improved cost per unit over conventional platforms. The ANVCE Project is evaluating potential advanced vehicle candidates in the light of technological feasibility, affordability and applicability to existing or projected naval mis- sions. The purpose of this effort is to obtain the information necessary for the development of a balanced naval vehicles R&D program. The various advanced ship technologies being considered by the ANVCE Project are: Surface Effect Ships (SES), Hydrofoils. Small Watorplane Area Twin Hulls (SWATH), Air Cushion Vehicles (ACV), Planing hulls. Ba.sic Navy doctrine (NWP-1) indicates that if the Navy is to support the national military strategy adequately, a balanced fleet is an absolute necessity. This should include not only a balance among types but also a balance between multi-purpose and single purpose units. In order for the Navy to provide a broad range of capabilities to meet its responsibilities there must be a balance among platform tyiies : aircraft carriers, surface combatants, submarines, mari- time air, amphibious forces, and support ships. The five advanced ship technolo- gies being considered by ANVCE fall within three of these platform types : air- craft carriers, surface combatants, and amphibious forces. AIRCRAFT CARRIERS Only SES and SWATH of the five advanced technologies appear feasil)le as aircraft carriers; SES carriers, upwards of about 11.000 tons and capable of 50-60 knots, and SWATH upwards of 20,000 tons and 2.5-30 knots. Virtually all potential SES and SWATH carriers aiv "beamier" than the Panama Canal limit, although a high length to beam ratio SES carrier could be designed within the Panama Canal constraint. SURFACE COMBATANTS All five technology types are feasible as advanced surface coml)atants. It is expected that in order to reduce unit cost the size will not exceed the 3,000 to 4.000 ton range, and at this size or smaller none are constrained by the Panama Canal limit. Monohull displacement ships, by contrast, could lie upwards of 25,000 tons before being constrained by the Panama Canal limit. Calm water speeds of 100 knots are feasilile with SES, and ACV ; 50-60 knots with hydro- 180 foils, 30-40 knots with planing craft and 25-30 Icnots with SWATH. Each type has unique advantages. AMPHIBIOUS ASSAULT CRAFT ACV (50 knots) and Planing hulls (30-40 knots) are candidates for future amphibious assault landing craft. Because of their small size they are not con- strained by the Panama Canal limit. The ANVCE Project is nearing completion, but its findings, conclusions and recommendations regarding the numerous technology alternatives must be thor- oughly reviewed within the Navy before being considered official policy. Final review is expected to be completed by late 1978. NiMiTZ Class Ships The approximate dimensions of the Nimitz Class carrier are : Overall length— 1,092 feet. Maximum beam — 257 feet. Draft to keel— 37 feet. Full load— 94,000 tons. Mr. NoNNENMACHER. I was about to ask you could the planned third set of locks accommodate the super carrier ? But novr you say no, because of the projected dimensions. Could Colonel Selleck enlighten us as to the engineering plausi- bility of building a third set of locks large enough to accommodate the Nimitz carrier ? Is that not feasible or is it feasible ? Colonel Selleck. I think the problem, sir, would be not as much with the size of the locks. You can build locks to any conceivable dimensions if you care to invest the money, but you have other limitations in the existing canal, the depth, controlling depth of the waterway itself. I am not that familiar with the overall limitations of the existing canal to testify in any more detail. Mr. NoNNENMACHER. Well, the third lock^ would have a deeper dimension, unless my memory is wrong, I know without question that the third lock, as planned would not have the width for the Nimitz carriers. But my question related strictly to the possibility of expanding the plans for the third lock so that it could handle the Nimitz-class ships that we have today. General Dolvin. From a nontechnical standpoint and studies I have seen there are two considerations. One is the depth of the Gail- lard cut, which has a practical working depth of 391^ feet. Second, is the matter of water — the amount of water that it takes to nm a ship through the locks. We do run short of water during the dry season. Mr. NoNNENMACHER. The matter of subsurface geology and slope stability — those two matters were specifically mentioned in the 1970 Canal Commission recommendations under No. 8. It recommended these two studies be continued to completion, and I am not certain they ever were, namely: A) an investigation of sub- surface geology of the proposed Route 10 to permit selection of the exact alignment for design purposes; and B) investigation of slope stability applicable to Route 10 geological conditions. And there also was a third one, investigation into the hydrodynamics of large ships moving through confined waters with variable currents. The subcommittee expects to have testimony regarding the acci- dent rate in the Gaillard cut — in narrow channels in general. 181 Could you give us any view, colonel, on the matter of a sea-level canal having a much longer, narrow channel than the present canal ? Have you looked into the possibility of greater danger of accidents in the sea-level canal because of this fact than in the present canal with the lakes taking up so much of the distance? Colonel Selleck. I am not prepared to testify to that now. I could provide more information for the record, if I may. Mr. NoNNENMACiiER. Wc would appreciate that very much, colonel. [The following was received for the record :] Sea-Level Canal Safety Is a sea-level canal more dangerous than a lock canal? Because of the absence of lock structures which create additional congestion and opportunities for accidents in confined waters, a sea-level canal can be expecteti to provide a less dangerous passage than a lock canal if tidal currents are adequately controlled. Tidal gates are proposed for the sea-level canal to reduce tidal currents to no more than two knots, a level at which experience indicates safe navigation is assured for commercial purposes. Mr. NoNNENMxVCiiER. Now, General Dolvin, you made the state- ment, as has been made here before by Senator Gravel, that the sea- level canal would be considerably less vulnerable. I doubt if anyone would dispute that when it comes to the matter of blowing the Gatun Dam and the fact that it would take a couple of years for rainfall to refill it. But you did say that the sea-level canal would not have as many sensitive places to be defended. I would like to read a paragraph from testimony taken by the U.S. Senate Committee on Interoceanic Canals in 1906 on the matter of the vulnerability of a sea-level canal versus a locks canal. The Canal's Chief Engineer, John Stevens, and an Army general said the former would be more vulnerable. The General's testimony was a written statement by Gen. Henry L. Abbott, U.S. Army, on "Relative Merits of Sea-Level and Lock Projects." I would like to get your comment on this paragraph. General Abbott said : It is conceivable that in the event of the passage of a fleet in time of war the hostile nation might plot its interruption, and as a military engineer, whose duties have made him familiar with the use of modern high explosives, I have given thought to the relative dangers of such attempts as directed against the two projects. The most vulnerable points are not the locks and sluiceways, for these occupy but little space and would certainly be guarded effectively. The danger would be at the points where a narrow waterway transverses a jungle, favoring the placing of a bag of dynamite where the ship must certainly pass, and where a man concealed in the undergrowth could lie in wait to fire the mine with a portable electric igniter, little expo.sed to danger of detection by a patrol. "Such places abound on the long and narrow route of the sea-level project, but are rare and easily watched on the relatively broad lake route. "The conclusion is thus manifest that the former has much more to fear from such operations than the latter. Now, General Dolvin, that is directly at odds with what you gave us to understand. Would you care to comment on that ? General Dolvin. AVell, I do not know the history of this general in 1906 — you know, really — the type explosives available at that time. But his statement on a kind of jungle warfare is certainly 182 applicable to either type canal. That same channel has to go through Gatun Lake, just laced with jungle and narrow waterways at the present time. If you are going to talk about defending a canal of either type in a hostile environment, where people could come up against the sides of the banks and shoot at you, you would have an inoperable canal under any conditions. It would be like forcing ships up from Vung Tau to Saigon in the Vietnam War. You have just a military operation rather than a commercial operation. I think you have outlined a pretty hypothetical case. I believe that in modern times — and it is the position of Admiral Halloway who testified at one of these hearings — that a sea-level canal is less vulner- able because of the absence of locks and so forth. Any damage to a sea-level canal is of less duration also. But, the General's statement about defending any type of facility going through jungle-type terrain and a hostile environment is probably as equally true today as it was then. You could lay in wait on the bank with a very small explosive charge and stop ships. You do not need to damage the canal. You certainly could interrupt shipping. That is the basis of our renegotiating a new treaty, to have a friendly environment rather than a hostile one in which to operate the canal. My. Nonnenmacher. I have only one last question, to Coloiel Sel- leck. If you have not an answer, please submit whatever informa- tion you can. That is, the effect of deforestation on siltation of the present canal. Have you any idea of the effect of deforestation on siltation in a sea-level canal such as is filling up the bottom of Madden Lake to- day ? Colonel Selleck. I do not think it would cause any major prob- lems. It is something that can be taken care of with proper mainte- nance, and you would almost certainly have to. In addition to the sedimentation of runoff erosion from de- forested areas, you would also have a certain amount of wash from the banks, caused by the wave action of passing ships, which would require periodic and then regular maintenaiice. But this is something which is a manageable problem. Mr. NoxxEXMAciiER. Thank you very much. Thank you, INIr. Chairman. Mr. Metcalfe. Mr. Tannenbaum. Mr. Tanxexbaum. Thank you, Mr. Chairman. With reference to the vulnerability of the canal, the sea-level canal, you say it would be considerably less vulnerable. And I know you responded to Chairman Metcalfe's question with regard to that. And you mentioned the Suez Canal situation. Could you elaborate further with regard to that? The Suez Canal was closed for a considerable length of time, of course. Would you care to General Dolvix. What I really was referring to, in the event you do have a ship sunk in it, or hostile action. It's an easier thing to raise and remove it. Now, in the case of the Suez, it was closed for a long period of 183 time before any clearing action was taken. And it involved many ships. I do not know the exact time it took to clear Suez but it was cer- tainly less than 2 years, which would be the amount of time neces- sary, even to refill Gatun Lake. From a technical standpoint — I believe my engineer friends will agree — it is easier to raise a ship than to rebuild a dam. Mr. Taxnenbaum. The time lag in the Suez situation was not necessarily just the removal of ships. General Dolvin. Xo. It was getting the political agreement and deciding to do it. Mr. Taxxexbal'm. They also improved it and deepened it. General Dolvix. They had mines in place they had to take out, so forth. Mr. Taxxexbaum. Yes. I would wonder if you would care to for the record, explain that. General Dolvix. Kelative vulnerabilities? JNIr. Taxxexbaum. Yes. General Dolvix. I would be glad to submit some for the record. [The following was received for the record :] Sea-Level Canal Vulnerability The relative vulnerability of a sea-level canal versus a lock canal, was ad- dressed in tile 1970 Interoceanic Canal Study Report. The report indicates that a sea-level canal across the American Isthmus would increase the security of the United States and other countries in the Western Hemisphere and it would be much less vulnerable to interruptions and hence easier to defend. The cur- rent weaknes.s*es of locks, power requirements and water supply would not exist. Blockages by scuttled ships or conventional bomb-induced slides could be removed relatively quickly and the possibility that it could be closed for long periods by hostile action would be remote. During the 24 January 1978 Panama Canal Hearings before the Senate Armed Services Committee, Admiral Holloway stated that an advantage of a sea-level canal would be that it would be considerably less vulnerable because it would not have locks. Additionally he indicated that a sea-level canal would be less susceptible to guerrilla attack. This did not mean however that a sea-level canal would be completely invul- nerable. For example, a ship loaded with explosives and detonated in the canal channel could block it. That however would take considerably more effort than, say, a hand grenade thrown into the electric control panel of the locks of the present canal. To summarize, the key areas of vulnerability existing in a lock canal are : a. The locks, dams and associated machinery. All are subject to sabotage as well as overt attack. b. The manpower — a large work force is required to run a lock canal. A large portion of this work force could be killed or disabled in an attack or infiltrated by saboteurs. c. Power supply. A large power supply is required to run the machinery as- sociated with the locks. d. AVater supply. If the present Panama Canal locks and/or dams were de- stroyed, it would take approximately two years to replenish the water supply. In both the present canal and any sea-level canal, long stretches of waterways would exist which would be vulnerable to enemy attack or sabotage. The degree of risk would be functions of several factors including whether or not the canal transitted hostile country, the type of terrain surrounding the canal and the length of the canal. There may be some tradeoffs in relative vulnerability be- tween a short lock canal and a very long sea-level canal. On balance, however, it must be said that in view of the foregoing and the fact that a sea-level canal would be easier and take less time to clear, it would be far less vulnerable to prolonged closure or destruction. 184 Mr. Tannenbatjm. Thank you. And analyze the breakdown, the cost estimates, in your statement. And I was wonderino; as to whether these inchide studies of the sea-level canal, outside of Panama, as well as the Panamanian routes. Colonel Selleck. Sir, those estimates were essentially for a re- study of Route 10 just west of the existin*i: canal. Mr. Taxxexbat'm. Do you have any view with regard to whether the canal should be — a new sea-level canal should be in Panama or outside of Panama? General Dolvik. No. I think that is certainly a function of up- datino- the 1970 study. But as a nontechnical man the relative costs of routes, outside of Panama, seem to be so much greater, and the distance so much longer, that the 1970 study was very heavily in favor of a route in Panama, just from an economic standpoint. I hasten to say there might be other considerations, such as poli- tical which you might want to crank into the equation. INIr. Taxnexbaum. Well, how about from a military standpoint? General Dolvix. From a military standpoint, if you are talking about defending a canal outside of Panama — we would prefer the shorter route. I believe the Nicaraguan route is about 150 miles up, and the route through Panama is essentially 51 miles. So from a transit stand- point, and the amount of terrain you have to defend, we would pre- fer to defend a shorter route. Mr. Tanxenbaum. What about from the standpoint of the type of agreement we might be able to get from the Panamanian Govern- ment? General Dolvix'^. I think you are getting into other factors there, such as political, and so forth. Mr. Taxx'^enbaum. Thank you. Mr. Noxxexmaciier. Mr. Chairman, could I interrupt to ask one question on this point ? Mr, Metcalfe. One question, yes. Mr. Noxxexmaciier. You said you would rather defend a shorter route. But would not a canal through Nicaragua, or even Mexico, be a far better route, militarily speaking, since you would have far less exposure of vessels to enemy submarine attack on a route, say, from San Francisco to New York, or to Europe, to help in NATO, or going the other direction to the Far East? Would it not be much better for the United States, strategically, to have a shorter overall route, regardless of the length of the canal, which would certainly be well protected by missiles, planes, and anti-aircraft fire? General Dolvix. It depends on your origin and destination. If you are assuming from the east coast to the west coast, perhaps that would be true. But do you want to comment on that ? Commander Gray. Well, you are speaking about the distance for example, in the Nicaraguan canal, being further north? Mr. Noxxexmacher. The overall water distance of a ship having to go from, say, Tokyo to London? Commander Gray. I would say that the distance, the added dis- tance of going further down to Panama and through — would be not significant, as compared to the other route. 12,439 12, 167 6,507 6,112 13,698 13,419 9,4S6 9,282 4,665 4,349 11,169 10,817 4,438 4,698 7,127 7,010 4,036 4,346 185 In other words, I think thorc is just not that miicli difFcrence be- tween the two of them, in the overall transit times. I am not sure of the distance between Route 10 in Panama and the route in Nicaraojua. But it is not very much. Mr. NoNNENMACiiER. I may be Avrong, but it is my understanding that it is a matter of several thousand miles. Maybe I am over-esti- mating. Commander Gray. I can get you the exact distance figures. Mr. NoNNENMACiiER. Givc your view in light of those figures. Commander Gray. Yes, sir. Mr. NoxNENMACiiER. Tliauk you very much. [The following was received for the record :] Distances Via Panama and Nicaragua The following information concerning comparative transit distances via sea level canals through Panama and Nicaragua is provided : Ports Via Panama Via Nicaragua Tokyo-London __ .._ Honolulu-Norfolk Manila-Gibraltar Sydney- Norfolk San Diego-Norfolk _ Norf ol k-ManiJa... _ _. Norfolk-Valparaiso San Diego-Rio de Janeiro _ Recife-Guayaquil _.. The distances shoAvn do not reflect transit of the canals. Based on a nominal transit speed of 10 knots, the transit time for the Panamanian canal (approxi- mately 50 miles in length) would be 5 hours, and for the Nicaraguan canal (approximately 150 miles in length) would be 15 hours. As reflected above the differences in distances are relatively small. Depiction of the different routes on a chart would not be demonstrative and would be diflBcult to depict in view of the converging tracks. For northern hemisphere transit, the Nicaraguan canal would shorten the total distance by approximately 300 nautical miles, for southern hemisphere transits the Panamanian Canal would offer the same advantage. Transit times are not given in as much as they depend on the vessel's speed. Response of Geneeal Dolvin to Question of Mb. Nonnenmacher on the Costs of Nuclear Vessels "The current cost of an intermediate-sized conventional carrier is approxi- mately $1.6 billion. The costs of a nuclear carrier approach $2 billion." Mr. Metcalfe. Thank you very much, General Dolvin, for your presence here. As always, you are most welcome. Also our thanks to Colonel Selleck and for Commander Anthony Gray, for your testi- mony this morning. The subcommittee will now stand recessed for 5 minutes. [Recess taken.] Mr. Metcalfe. The recessed hearings of the Panama Canal Sub- committee will come to order. Ladies and gentlemen, we have with us Thomas M. Con.stant, Secretary of the Panama Canal Co. Mr. Constant has, in the Government's behalf, kept the subcommittee informed of important events affecting the canal. Before he became Secretary of the canal — of the company — sev- eral years ago, he w^as previously the military assistant to the Secre- tary of the Army for Panama Canal Affairs. 186 As always, we are delighted to hear from Mr. Constant today. Mr. Constant? Mr. Constant. Thank you very much. I am delighted to be here. Unfortunately, Governor Parfitt could not be here today. But I am pleased at the opportunity to present his statement in connection with the legislation that is presently under consideration. Mr. Metcalfe. Do you plan to summarize his statement ? Mr. Constant. If you have no objection, sir, I will summarize portions of it and provide it for the record. INIr. Metcalf. All right. I ask unanimous consent that Governor Parfitt's statement be included in the record. Hearing no objection, it will be so ordered. It will be included. Would you proceed, now, with your summary. [The following was received for the record :] Statement of Governor H. R. Parfitt, Panama Canal Company Mr. Chairman and members of the Committee, I am Thomas M. Constant, Secretary of the Panama Canal Company. Unfortunately, Governor Parfitt could not be here today, but I am pleased at the opportunitv to present his statement in connection with H.R. 10087. H.R. 8309, and H.R. 13176, all of which deal with updating available information concerning the feasibility of a sea-level canal in this hemisphere. As the official charged with the responsibility for the operation of the present Panama Canal, Governor Parfitt believes that certain aspects of that operation are of interest in any serious discussion of a sea-level canal. I will begin with a brief summary of the interest that has focused on alternatives to the present Canal since WW II. I will then discuss factors that are relevant to the future utility of the existing waterway, including : traffic and tolls revenue, future vessel construction. Canal capacity, and potential im- provements to enhance that capacity. HISTORY OF RECENT INTEREST IN A SEA LEVEL CANAL The idea of constructing a sea-level canal across the American Isthmus to connect the Atlantic and Pacific Oceans goes back many years. It was the sub- ject of much debate during both the French and American efforts to construct a canal in Panama. Since WW II, interest in a sea-level canal has led to a num- ber of studies and reports with respect to Isthmian Canal improvements. These reports include studies of: improvements required to increase the capacity of the existing Canal ; third locks projects ; and sea-level canals. The most important of these studies may be summarized as follows : A 1947 study conducted by the Governor of the Canal Zone under authority of Public Law 79-280, identified and numbered thirty potential sea-level canal routes. All subsequent studies have adopted this 1947 numbering .scheme. In 1960, a study conducted by the House Committee on Merchant Marine and Fisheries includefl a study of improvements to the existing Canal, Third Locks projects, and sea-level canals. Major emphasis was placed on a sea-level canal route through the existing Canal Zone if and when a sea-level canal was required. Also in I960, a long-range study by the Panama Canal Company of the three alternatives, i.e., improvements to the existing Canal, third locks, and sea-level canal, determined that the most practical sea-level canal route would be through the Canal Zone. In 1964, for the first time, a study of nuclear excavation techniques was pre- pared jointly by the Panama Canal Company, Atomic Energy Commission, and the Corps of Engineers. Detailed plans and cost estimates were developed for nuclear construction of the most promising sea-level canal routes in Panama and Colombia. This study concludes of the so-called "PANAMAX class," bulk carriei-s. tankers and container .'^liips liaving overall Iveams in excess of 100 feet, transit the Canal daily and have accounted for approximately 10.6 percent of average daily transits during the first nine months of FY '78. Movement of North Slope oil has contributed to this increase 189 with such PANAMAX vessels as the OVERSEAS NEW YORK (894' X 105') and three sister ships, all of 89,000 deadweight tons. CANAL CAPACITY As you know, the present Panama Canal is a lock-type Canal ponsisting of three sets of locks — two on the Pacific side of the Isthmus and one on the Atlantic side. Ships are raised and lowered through the locks by a gravity-fed system using water supplied by a central fresh wat«r lake located between the Atlantic and Pacific locks. The locks chambers measure 1,000' X 110', thereby effectively limiting the maximum size of any transiting vessel to about 950' X 106'. Other structural features of the locks system limit the maximum allowable draft to 39'6". This combination of the length, beam and draft factors restrict ship size to approximately 05,000 deadweight tons, although the largest laden vessels have reached about 90,0(K) deadweight tons. The ability of the Panama Canal system to transit ships is further restricted by the complex interaction of many varied factors including : lacks structures and overhaul requirements, weather, lockage time, water supply and storage, ship characteristics and arrival patterns, and scheduling and control of transits. These factors combine to decrease locks effectiveness and place a limit on Canal capacity. On the other hand, over the years there has been a constant effort to increase Canal capacity to accommodate the changing traffic demand. The 1969 A. T. Kearney Canal Improvement Program Study indicated a Canal capacity of 67 ships per day (with 32 percent ships 80' plus beam). The 1978 International Research Associates Canal traffic projection confirmed the trend of drastic in- crease in ship size (up to 70 percent ships 80' plus beam over the next 20 years) with slower growth in number of ships. A compi'ehensive update of the Canal Improvement Program was subsequently completetl with the objective of de- veloping projects geared to Canal capacity at different traffic levels so that project need and priority would meet traffic demand in the years to come. These Canal improvements would provide for incrementally raising Canal capacity from 35-37 ships per day to 48 .ships per day which it is now (or 17.500 per year) with 75 percent large beam ships (80'-106' beam). These im- provements relate to locks capiacity, safety and locks effectiveness, lockage water, and traffic control and communications. SUMMARY In summary, the Canal, becau.se of its physical dimensions has a capacity limit. These physical limitations also serve to limit the design of vessels serving in trades which use the Canal. Estimates of the Canal's capacity in terms of numbers of transits have varied widely becau.se of the change in the ship size or mix. Because of the problems of estimating numl)ers of transits and ship mix, it is difficult to predict the precise point in time when the capacity of the Canal will be reached. However, we now expect that to occur sometime after the turn of the century. There is little question that the availal)le data on the technical aspects, en- vironmental concerns, and the economic viability of a sea-level canal in the Western Hemisphere must be updated if serious consideration is to be given to such a project. In view of the Provisions of Article II of the recently approved Panama Canal Treaty, if this bill were to be enacted, it would seem appropriate for the study group to be composed of representatives from both the United States and Panama. If you have any questions, I will l)e plea.sed to answer them. STATEMENT OF THOMAS M. CONSTANT, SECRETARY, PANAMA CANAL COMPANY Mr. CoNST.vxT. Thaiilv you very mucli. A.S the official charged ^vith the responsibility for the operation of the present Panama Canal, Governor Parfitt Ijelieves that certain aspects of that operation are of interest in any serious discussion of 190 a sea-level canal. Isthmian Canal improvements. These reports in- clude studies of: Improvements required to increase the capacity of the existing- canal, third locks projects, and sea-level canals. The report of the Governor summarizes the list of the important studies that are — that have been conducted, and culminates with a rundown on the "1970 Interoceanic Canal Study." I will not repeat that, as General Dolvin covered it rather thoroughly in his testimony. I would like to cover in more detail the future utility of the canal. Any serious study of the technical feasibility of a sea-level canal should take the future utility of the existing canal into consideration. Therefore, I would like to spend the next few minutes discussing certain aspects of that utility as we view them at this time. A number of forecasts of canal traffic and tolls revenue have been developed over the years. The record of these individual forecasts has been spotty at best reflecting, as they necessarily do, views of the future. However, the Panama Canal traffic and review study, 1978-2000, conducted by the consultant firm of International Research Asso- ciates and completed last January, when read together with the fore- cast contained in the 1970 interoceanic studies I referred to earlier, tend to set reasonable limits on potential canal traffic. The denomina- tors common to both forecasts are the various estimates of transits, cargo and tolls revenue as shown in the complete statement, which will be provided for the record. Obviously, the range of these forecasts is wide. The most opti- mistic, that by lOCSC, exceeds by a fairly wide margin the limits of canal traffic as now viewed by most observers. Our own long- range view of canal traffic leans more to levels indicated by an in- ternal company forecast of 1977. The basic elements of that forecast are holding up well in line with our current experience, and lowered trends in world trade argue for somewhat lower rates of growth than has been our experience from 1947 through 1974. We expect that transits, tolls and cargo will be approximately 17,000 transits, $294.0 million and 235 million tons, respectively, by the year 2000. We now estimate the canaFs maximum capacity at approximately 17,500 transits and 250 to 300 million long tons of cargo. As I pointed out before, the forecasting record for canal traffic and tolls tends to be spotty. Analysis of one commodity. North Slope oil. indicates the nature of the difficulty. At one time, before the oil embargo, it was believed that all North Slope oil would be consumed on the west coast. Later, when the pic- ture changed, it was thought the North Slope oil surplus to the west coast would be moved via pipeline to the east coast as early as 1979 or 1980. It was also conjectured that an oil swap with Japan would be the alternative of choice. Some of these conjectures are still with us. At this point, we are averaging about 450,000 barrels of North Slope oil a day through the canal but that figure should decline slightlv according to industry estimates to about 400.000 barrels per day. We will estimate that maximum flows through the canal could be between 400-600,000 barrels per day for several years until other 191 more economical alternatives to the canal may be used. Depending on future North Slope pi-oduction and future transportation develop- ments, eventually only a small amount of North Slope oil shipments may move through the canal. Another factor to be considered is that the general upturn in ship- ping worldwide over the past 20 years has not been matched by an equivalent groAvth in numbers of ships transiting the Panama Canal. In fact, the total number of vessels transiting the canal at present is little changed from the early 1960's even though the volume of cargo has about doubled. The obvious explanation is that the average ship size has increased. Since the mid-1950's, the trend toward construction of larger and faster ships has continued wdth all the basic types of ships using the canal having increased in size. Over the past 10 years, the number of bulk carriers and container ships has increased rapidly while the number of tankers and refrigeration ships has remained about the same until the advent of North Slope oil. As a consequence of these trends, there has been a substantial in- crease in the average size of ships transiting the canal. During the first 7 months of fiscal year 1978, vessels of 80 foot beam and over averaged over 13.0 per day of the total oceangoing transits as com- pared to an average of 4.0 per day in 1968. Looking to the future, we anticipate that in the short term, the trend of increased ship size will continue but the long-term prospects indicate a tapering off of that trend. Ultimately, it is the canal's physical limitations that will control vessel size. Tanker traffic in recent months illustrates some of the factors which influence vessel size among our canal customers. For example, the start of the Alaska oil movement has resulted in a sharp increase in the average size of tankers using the canal during fiscal year 1977 and 1978. It is anticipated that this growth rate will eventually flatten out. As you are aware, there are three governing factors which restrict ships from canal transit : overall length, beam and draft. As of July 1, 1977, it was estimated that about 10 percent of the total world fleet was too large to transit the c?nal. However, experience has shown that the shipping industry still considers the present canal a useful link between the two oceans. Although ship sizes have increased, shippers in many instances have deliberately tailored ship construc- tion to meet the physical limitations of the canal. Ships of this so- called ''''Panairmx class", bulk carriers, tankers and container ships having overall beams in excess of 100 feet, transit the canal daily and have accounted for approximately 10.6 percent of average daily transits during the first 9 months of fiscal year 1978. Movement of North Slope oil has contributed to this increase with such Panamax vessels as the Overseas New York [894 by 105 feet] and three sister ships, all of 89,000 deadweight tons. As you know, the present Panama Canal is a lock-type canal con- sisting of three sets of locks. Ships are raised and lowered through the locks by a gravity-fed system using water supplied by a fresh water lake located between the Atlantic and Pacific locks. The locks chambers measure 1,000 by 110 feet, thereby effectively limiting the maximum size of any transiting vessel to about 950 by 106 feet. Other 192 structural features of the locks system limit the maximum allowable draft to 39 feet 6 inches. This combination of the length, beam and draft factors restrict ship size to approximately 65,000 deadweight tons, although the largest laden vessels have reached about 90,000 deadweight tons. The ability to transit ships is further restricted by the complex interaction of many varied factors including: locks structures and overhaul requirements, weather, lockage time, water supply and stor- age, ship characteristics and arrival patterns, and scheduling and control of transits. These factors combine to decrease locks effective- ness and place a limit on canal capacity. On the other hand, over the years there has been a constant effort to increase canal capacity to accomodate the changing demand. A comprehensive update of the canal improvement program was subsequently completed with the objective of developing projects geared to canal capacity at different traffic levels so that project need and priority would meet traffic demand in the years to come. These canal improvements would provide for incrementally raising canal capacity from 35-37 ships per day to 48 ships per day [or 17,500 per year] with 75 percent large beam ships [80 by 106 feet beam]. These improvements relate to locks capacity, safety and locks effectiveness, lockage water, and traffic control and communications. In summary, the canal, because of its physical dimensions has a capacity limit. These physical limitations also serve to limit the de- sign of vessels serving in trades which use the canal. Estimates of the canal's capacity in terms of numbers of transits have varied widely because of the change in the ship size or mix. Because of the problems of estimating numbers of transits and ship mix, it is difficult to predict the precise point in time when the capac- ity of the canal will be reached. However, we now expect tha-t to occur sometime after the turn of the century. There is little question that the available data on the technical aspects, environmental concerns, and the economic viability of a sea-level canal in the Western Hemisphere must be updated if serious consideration is to be given to such a project. In view of the provisions of article II of the recently approved Panama Canal Treaty, if this bill were to be enacted, it would seem appropriate for the &tudy group to be composed of representatives from both the iJnited States and Panama. If you have any questions, I will be pleased to answer them. Mr. Metcalfe. Thank you, Mr. Constant. In your report, you indicated — without quoting you verbatim — ^that the 1970 report recommended that the construction of the sea-level canal begin 15 years before the saturation point of the present canal. At that time saturation was projected to occur in the 1990's. It now appears that the canal's saturation would occur sometime after the year 2000. "Why could not the study of the sea-level canal wait until there is greater certainty as to the date when the capacity of the present canal will be reached ? Mr. Constant, ]\Ir. Chairman, our estimates, we feel at this point, are pretty close to the mark, because of the trend in traffic through 193 the canal. It is becoming perhaps a little more predictable, with the exception of the North Slope oil. And it seems to me that the earlier any update of the 1970 study were done, perhaps the better off the committee would be in making their judgments. Now, the traffic itself, and the saturation point of our present canal, are fairly well fixed, we think, based upon our current studies. Mr. Metcalfe. If we are going to liave this study, and it will prob- ably take 15 years to construct a sea-level canal — were we to request that this 1970 report be updated — the question is how long that up- date report w^ould be germane. Right now, the present record is not germane. The Atlantic-Pacific report was w^ritten in 1970, and is not germane to our problem as it exists today. And, of course, I am trying to get an idea as to the timing of this, before there is any decision on the request to update the 1970 report. My next question, ISIr. Constant, is this. Traffic experience of the Panama Canal indicates that the greater percentage of accidents take place in the narrow channels of the canal and at the locks. Would not a sea-level canal have even more narrow channels, like the present canal has the Gaillard cut, i^articularly. Will there be a greater chance of accidents ? Mr. Constant. The cut at the present time, as you know, sir, is 500 feet wide. And it has been widened to that in recent years. There are other sections of the canal which previously were more narrow, and have recently been widened to the 500-foot mark. We found this to be adequate at the present time, although we have limited the traffic through these segments to one-way traffic for certain size vessels — as Mr. Modglin mentioned in his ques- tion before — and we do this for the safety of vessels. I Avould imagine that the sea-level canal would have to do exactly tlie same thing, because of the size of the vessels going througli tliere. There will be much larger vessels tlian we have going through our present canal. A sea-level canal would undoubtedly have to do the same thing, that is limit the direction of traffic. Mr. Metcalfe. Thank you. If a sea-level canal were completed before the year 2000, would this not so vitally affect the present canal, that the Panamanians might demand that the recent treaties be renegotiated? Mr. Constant. That is a little bit out of my field of expertise, Mr. Chairman. Mr. ]\Ietcalfe. It is out of my field of expertise, but I have a sensitivity to that and need to get an answer. Mr. Constant. Yes, sir. Certainly I would agree with you that there could be that difficulty. Mr. Metcalfe. Thank you very much, Mr. Constant. Mr. Modglin, do you have any questions? Mr. MoDOLiN. In connection with the question of a further increase in canal traffic, and the need for fresh water in connection with the increased traffic, is there some question right now, in the view of the canal organization, of whether the fresh water is adequate for the further increase in canal traffic that is expected between now and the vear 2000 ? 194 Mr. Constant. If the traffic increases at the rate that it is now, it would be insufficient, unless we make certain modifications, as the traffic increases, and we plan to do that. The technique that we intend to use is the lowering of the bottom of the channel to create a larger reservoir for the water, so that there would be sufficient water by the year 2000, or by the time we reach the capacity of the canal to handle the transits. Mr. MoDGLiN. The second question I have relates to the question of the reputed obsolescence of the present canal. You mention in your statement that about 10 percent of the world fleet was presently too large to transit the canal. And I guess that would probably number about 2,500 vessels. Could you provide for the record, if it is not immediately available to you, the number of those vessels that are too large to transit the canal, first those vessels which trade on routes that could not possibly use or traverse the Isthmus of Panama, or sea-level canal, as an al- ternative route, and second those vessels, if it is possible to identify those vessels, that are too large to transit the canal, but which can be identified as vessels which might use a sea-level canal, if one were constructed. Mr. Constant. I will be happy to provide that for the record. [The following was received for the record :] Vessels Too Lakge to Transit Canal Qtiestion la. Number of vessels too large to transit the Canal is about 10 percent of world fleet. How many of these vessels are on trade routes that would not have any occasion to use the Canal? Answer. It is not possible for the Panama Canal Company to provide a definitive answer to the question. However, it is known that a number of the vessels in the w^orld fleet that are too large to transit the Canal are on trade routes that would not have any occasion to use the Canal ; for example, the tankers involved in the movement of oil from the Middle East to Europe and Japan with some large hulk carriers in the iron ore trade with Japan from Australia, Peru and Chile. In FY 1977 we have knowledge of 36 vessels on 45 voyages carrying coking coal from Hampton Roads to Japan that bypassed the Canal using the around Africa route. The total cargo tonnage bypassing was approximately 3.0 million long tons. Question lb. How many of these vessels might use a sea level canal (i.e., vessels that would transit the present Canal but for their size) ? Answer. It is entirely possible that these coal vessels would use a larger Canal at current toll rates since voyage costs between Hampton Roads and Japan would be significantly lessened. In addition, the approximately 6-7 tank- ers shuttling North Slope oil from Alaska to Panama that are too large to u.se the Canal would probably transit a sea-level Canal deijending on toll charges. Mr. MoDGLiN. That is all I have. Mr. Metcalfe. Mr. Nonnenmacher, do you have any questions? Mr. NoNNENMACHER. Ycs, sir. Mr. Constant, what is the projected year for the saturation of the present canal, trafficwise? Mr. Constant. It would be sometime about the next century. Now exactly how far beyond the year 2000, we are not absolutely certain. But clearly not too many years, based upon the fact that our satura- tion point is considered 17,500 transits. 195 Mr. NoNNENMACHER. But Certainly not during the time we will continue in control of the waterway ? Mr. Constant. That is correct. Mr. NoNNENMACHER. On page '2, yon mentioned that in 1960 the Panama Canal Co. made a long-range study of three alternatives : Improvements to the existing canal, third locks, and sea-level canal. And it was determined that a more practical sea-level canal route would be through the Canal Zone. Wliat did it determine, or did it determine which of the three was more preferable? Mr. Constant. I am not absolutely certain as to the rationale that led to that conclusion. But I have a feeling that one of the considera- tions was that we had control of the Canal Zone. And it would be easier to do the construction in an area over which we had control. Mr. NoNNENMACHER. That is satisfactory as far as determining where the most practical sea-level canal route would be. But how about a preference as between the construction of the third locks or a sea-level canal ? Did the study reach a conclusion in that regard ? Mr. CoNSTxVNT. I have not reviewed that study, and I would have to provide that to you. [The following w^as received for the record :] Alternate Routes Evaluation The 1960 in-house study of three alternatives determined that only the im- proved present Canal and the sea-level canal through the existing Canal Zone merited further consideration. This study considers that an improved present Canal only defers the obsolescence of the present locks Canal to the 1980 to 2000 period. A sea-level canal is considered to be the best solution due to : (a) National defense. (b) Flexibility to enlarge as ships become larger. (c) Operating cost savings will eventually more than compensate for higher initial cost when compared to a third locks solution. Mr. NoNNENMACHER. How about at the present time? Is there a preference on the part of the company for the third locks route or for a sea-level canal ? Mr. Constant. No. We have not taken a position on that, in that we feel that the present canal is capable of handling traffic that is projected through this century. Mr. NoNNENMACHER. I scc. Now, you mentioned a modification, the lowering of the channel bottom. Has the company made any studies on the deforestation problems, and the siltation resulting from it, as affecting the depth of the channel in the lakes, and therefore the vessel traffic through them ? Let me first state : Have you considered siltation a problem in the past? Is it a problem today? Do you consider it will be a real problem in the future? Mr. Constant. Well, there is always siltation in the canal, and there is continual maintenance dredging in order to maintain the level of the channel bottom at the appropriate level. Mr. NoNNENMACHER. I believc you were here and heard the testi- mony that the colonel gave in answer to that question, in that regard. Would you agree with him that the siltation in the sea-level canal would be no greater a problem than it is in the present canal? 196 Mr. Constant. Probably no greater, with the exception that there would be a flow through the sea-level canal at certain periods, that could increase the siltation. Whereas, at the present time, there is not a continuous flow through the present canal. Mr. NoNNENMACiiER. I appreciate your making that point, because this seems obvious, on the face of it, that the sea-level canal would have a much greater wash. The rate of waterflow would certainly carry much of that silt, whereas the locks would stop that. Mr. Constant. I would hasten to add that I am not an engineer, and I would leave that to the more qualified. Mr. XoNNENMACHER. Has there been any effort on the part of the company to seek a reduction in the deforestation that is deliberate in the canal's watershed, that is known as going on in Panama ? And have you done anything, second, about the squatters that have done a certain amount of deforestation, on a much smaller scale, of course, within the Zone itself? Mr. Constant. This is a problem that the Governor does discuss with the American Embassy in Panama, and raises this periodically, when it becomes a problem. Mr. NoNNENMACHER. Has anything been done? Has the govern- ment of Panama cooperated in seeking to halt this deforestation, in the Republic itself? JNIr. Constant. I understand that there is an ongoing effort on this, and I can provide you with the details for the record. Mr. NoNNENMACHER. Could vou tell us at this point — if not, pro- vide it please — is fairly much timbering done by American com- panies, in Panama, that directly affects the canal itself? Mr. Constant. I am not familiar with that. And I would have to check into that and provide it for the record. [The follow'ing was received for the record :] Deforestation The problem of deforestation, encroachment and squatting into the Canal Zone has increased significantly in the last few years. Efforts to limit defores- tation of the Canal Watershed have met with limited success. Police records for the past two years show more than 50 arrests and destruction of several illegal farm type dwellings. The rapid population growth in Panama urban areas (5-6% annually), the rural-urban migration, the present high rate of unemployment, and the spiral- ing inflation are a few of the major factors responsible for the increase in the illegal activities noted along the Canal Zone/Panama border and throughout the watershed. In recent attempts to reverse the significant forest destruction, several joint efforts (meetings, field trips and/or aerial reconnaissance flights) between the Panamanian Government and Canal Zone ofificials have taken place. At present, the Company is developing and will implement a plan of action to convince all concerned of our continuing interest and commitment to stop tlie deforestation within the Canal Zone. The plan calls for an increased level of improvement by the Company/ Government tlirough augmentation of the protective force and logistical sup- port. We plan to more aggressively patrol the area, secure cooperation by all interested parties, and to establish more formal institutional linkage with Panama's renewable resource conservation agency. In tliis connection, we have already established an environmental committee made up of representatives from Panama and the Canal Zone. There have been extensive timbering activities outside tlie Canal Zone which will have adverse affects on the operation of the Canal in the long term. This 197 has been made known to Panama and they are making plans for more adequate control in the future and for reforestation projects. Mr. NoNNEXMACiiER. I wisli you would. Thank you very much. I do not have any other questions, INIr, Chairman. Thank you. Mr. Metcalfe. Thank you, jNIr. Nonnenmacher and Mv. Constant. Mr. Tannenbaum is now recognized. Mr. Tanxenbaum. Yes. Thank you, Mv. Cliairman. Does the Panama Canal Co. have a position as to the feasibility, practicality, and advisability of constructing- a sea-level canal? Mr. Constant. No, we have not taken a position with reference to that. Mr. Tannenbaum. What is the general feeling, your feeling, or Governor Parfitt's feeling? Mr. Constant. Well, he is — I am sure feels that it is feasible to do such a project. But our position has been that the present canal is sufficient to handle the projected traffic through the year 2000. And we have not taken a position as to whether the sea-level canal should be constructed. Mr. Tannenbaum. With the lead time, as you say, 15 years, that takes us approximately to the year 2000. So I would imagine that it is time to start considering something like that. Mr. Constant. We have not gone into that, specifically. Mr. Tannenbaum. Thank you. Mr. Metcalfe. Is that it ? Mr. Tannenbaum. Yes. Mr. INIetcalfe. Thank you very much, ]Mr. Constant, for your very fine testimony. Mr. Constant. Thank you, Mr. Chairman. Mr. Metcalfe. Give our regards to the Governor, if you will, please. Mr. Constant. I will. Thank you, sir. Mr. Metcalfe. Thank you. [The following was received for the record :] Question of Mr. Nonnenmacher and Answered by Mr. Constant Question. Colonel Sheffey testified that hundreds of millions of tons of At- lantic and Pacific waters have been interchanged by ships transiting the Canal over 70 years. Can the Company supply any more accurate figure for this transfer? Answer. There is no doubt that there has been a mixing of Atlantic and Pacific waters over the years by vessels transiting the Panama Canal. xVU ves- sels transiting tlie Canal are required to have a suflicient minimum draft to permit safe handling during transit. A vessel arriving for transit which does not satisfy the minimiun draft re- quirements would be required to take on salt water ballast prior to transit. However, the Panama Canal Company has no record of the number of vessels taking on salt water l)allast, the volume of ballast involved or the subsequent amount discharged in the other ocean. Question. Is there timbering being carried out by American companies outside the Canal Zone that affects the Canal? Answer. The Canal Zone authoi-ities have no information as to whether or not U.S. companies are timbering outside the Canal Zone. There are no U.S. companies timbering inside tlie Canal Zone. Information concerning the opera- tion of U.S. companies in Panama outside the Canal Zone is maintained by the U.S. Embassy in Panama and the Government of Panama. Mr. Metcalfe. The next witness will be Dr. David Challinor, who is the assistant secretary for science of the Smithsonian Institution. 198 Dr. Challinor is a graduate of Harvard College, and holds a Ph. D. from Yale. He came to the Smithsonian in 1966 as a special assistant for tropical biology, and has been assistant secretary for science since 1971. We welcome you. Dr. Challinor. STATEMENT OF DR. DAVID CHALLINOR, ASSISTANT SECRETARY FOR SCIENCE OF THE SMITHSONIAN INSTITUTION; ACCOM- PANIED BY DR. MEREDITH JONES, CURATOR, DEPARTMENT OF INVERTEBRATE ZOOLOGY, NATIONAL MUSEUM OF NATURAL HISTORY, SMITHSONIAN INSTITUTION Dr. Challinor. Thank you, Mr. Chairman. I have a summary statement, and I would ask your permission to include the full state- ment in the record. Mr. Metcalfe. Hearing no objection, the full statement will be entered into the record. [The following was received for the record :] 199 Statement of David Challinor, Assistant Secretary fob Science, Smithsonian Institution Mr. Chairman, Members of the Subconunittee: I appreciate the opportunity to appear today to discuss the importance of an ecological study as a prelude to any possible construction of a sea-level canal. The Smithsonian Institution, it should be noted, holds no position on whether or not an Atl£intic-Pacific Interoceanic Sea-Level Canal should be built. Because of the incomplete state of knowledge concerning the hydrography of the region, especially of the Atlantic, it is not possible to predict the ecological effects of a sea-level canal . Tlie Institution, does, however, support implementation of the 1970 report of the Atlantic-Pacific Interoceanic Canal Study Commission, particularly with respect to biological and hydrographic surveys. At a meeting in 1908 of the Biological Society of Washington it was reported that "there were no regular communications. The evening was devoted to a discussion of the necessity for an immediate biological survey of the Isthmus of Panama." At a meeting of the Society in the following year "T. E. Wilcox read a letter from Col. Gaillard, U.S. Engineer, urging a biological survey of the Isthmus of Panama." Also in 1909, in a scientific paper, "Notes on some fishes from the Canal Zone" (Proceedings of the Biological Society of Washington, vol. 22, pp. 95-104), B. W. Evermann and E. L. Goldsborough stated, "It is a source of great regret to biologists that the Government has not appreciated the necessity for a thorough biological survey of the Canal Zone before the completion of the canal. It is not yet too late to make such a survey, but it must be made before the canal is completed; else problems which can now be 200 -2- solved will then remain forever unsolved," Nearly 60 years after the opening of the Panama Canal, in reports presented by the Atlantic-Pacific Interoceanic Canal Study Commission, both the Battelle Memorial Institute and the National Academy of Sciences called for biological and hydrographic surveys in the isthmian region; the University of Miami, in its report to the Battelle Memorial Institute, called for the same; and all of the biological researchers commenting on the state of knowledge of the biota of the isthmian region at a 1971 symposium, "The Panamic Biota: Some Observations Prior to a Sea-Level Canal", urged the undertaking of biological and hydrographic surveys. A second report by the National Academy of Sciences in 1977 again called for a biological and hydrographic survey, and the Smithsonian again joins those across nearly seventy years in calling for a biological and hydro- graphic survey. The Smithsonian's interest and involvement in Panama dates from the 1920s and includes the establishment of the Smithsonian Tropical Research Institute. Originally research emphasis was on terrestial and fresh water habitats, but in 1965 marine facilities were established on Naos Island; at Fort Amador, on the Pacific coast; and on Galeta Island, on the Atlantic coast. The Naos laboratory presently has a permanent professional staff of five and laboratory space for up to 30 visitors; the small Galeta laboratory has one professional staff member and space for up to 12 visitors. The marine research program has included faunal and floristic studies; observations on species diversity of various plant and animal 201 -3- communities; research on the ecology and community structure of coral reefs, the ecology of sandy beaches, and the ecology of sea floor com- munities; and studies on the temperature tolerances of fish, predator- prey relationships among invertebrate animals such as crabs and snails, the biology of sea snakes, and reproduction of trans -isthmian species pairs. In addition, a monitoring program involving continuous observations of tide level, wind direction and velocity, salinity, dissolved oxygen, and sea water and air temperatures has been in operation at the Galeta laboratory for five years. Other Smithsonian units also use the resources of the Canal Zone for scientific purposes. The Radiation Biology Laboratory maintains solar radiation monitoring equipment on Flamenco Island, close to the Naos Island laboratory, and since May, 1971 scientists from the National Museum of Natural History have made general collections of invertebrates of all sorts from intertidal and subtidal localities in the Zone and nearby Panama. There has been a special effort to collect biological material from the lock chambers of the canal whenever they are drained for routine maintenance. All of these collections represent, on an unfortunately small scale, an attempt to accvmiulate base line samples of biological specimens . In the event of a construction of a sea-level canal, these will form the "before" part of studies to show the effects of such a sea-level canal. The ecological effects of a sea-level ceinal are, we believe, inevi- table, and will fall upon the isthmian human population, the freshwater flora and fauna, and the maring flora and fauna. We believe that the greatest impact will be on the marine environment. 202 The ultimate estimation and evaluation of the results of mixing the waters and the biota of the Pacific and the Atlantic lie at the end of a series of biological procedures. The crucial point of departure, heretofore absent in reports and speculations about the effects of a sea- level canal, is a complete biological base line survey. Everything that follows — all of the natural history observations, all of the behavioral and physiological experiments, all of the predictions and speculations — must be founded upon a firm taxonomic base. We must know which species we are dealing with, plants and animals, as well as their parasites. We must know the ecological requirements of species in their present, normal environment; the ranges of salinity to which a given locality is subject; the variation of temperature; the type of sediment; seasonal variation of dissolved oxygen and nutrients; and the presence of diemical abnormalities . We miist know what species are found where and the physical and chemical characteristics of that site. We must know how plants and animals of a given locale interact to form communities; which species are food for another; which species dominate the community; if the community is characterized by large areas of the sea floor or water mass; if the community is a feeding ground for econom- ically important species; and if it is a nursery for juvenile forms. We must know which plant and animal species are hosts for which parasites, and which disease-causing organisms affect which species. We must know the life cycles of plant and animal species: the length of juvenile stages; their transportation and dispersal by water currents; 203 -5- if they are brooded or incubated; how their food requirements differ from those of the adults; adult requirements for living space; chemical or physical requirements; and reproductive and other behavior patterns. We must know the survival limitations of the species: what ranges of ten^jerature and salinity they can tolerate; specific sediments required for normal development; and if their survival requires the presence of a specific species of plant or animal. We must compare the plants and animals of the Atlantic and Pacific, the same species if such is the case, closely related species if that is the case, or species occupying the same relative place in comparable communities if that is the case. We must make comparisons based on competition for space, food, and reproductive mates. We must compare relative tolerances to changing environmental conditions . We must attempt interoceanic hybridizations of species. We must compare the relative efficiency of reproduction with respect to speed of larval development and numbers of viable offspring. We must know existing current systems off both coasts, especially the Atlantic. We must know the extent of the upward movement of colder, nutrient-rich bottom water to the sea surface. We must know wind and wave patterns. We must know as accurately as possible the prospective hydro- logical effects of a sea-level canal, with and without tidal gates; the extent of oscillation of water masses in the canal due to tidal effects; and the extent of the flow plume into the open sea. When all of this is done, we can properly assess the possible environmental effects of an interoceanic sea-level canal. 32-461 O - 78 - 14 204 There are only two important surveys on the isthmian region which bear on the ecological implications of a sea-level canal, and three reports. The first survey, 6n oceanographically oriented project concerned with the Panama Bight, was conducted by the Inter-American Tropical Tuna Commission in 1965-1966, and was reported upon by E. D. Forsbergh of that Commission. The area studied extended from the western edge of the Azuero Peninsula, east to the mainland, and as far south as Buenaventura, Colombia. The study dealt mainly with seasonal changes in the climatology, oceanography, and fisheries of the area. Among others, the study documented the phenomenon of upwelling and the correlation of this with seasonal abundances of yellowfin, skipjack, anchoveta, and shrimp. The second survey, the only large scale biological study of the isthmian region, was carried out by the University of Miami in 1966 and 1967. Some 253 stations were occupied in depths of 10 to 2,000 meters, from Golfo de Mosquitos, Panama, to Cartegena, Colombia, in the Atlantic, and in the Gulf of Panama from the southeast tip of the Azuero Peninsula to just south of the Golfo de San Miguel, Panama. Nearly 1,900 species of marine animals were collected, mainly by bottom and mid-water trawls. Eight invertebrate communities were recognized on the Atlantic continental shelf and slope and four on the Pacific shelf and slope. Six fish communities each were recognized in the Atlantic and the Pacific. The collections were a part of fiiami's continuing ocean-bottom surveys and, following established procedures, were made with trawls. This type of collecting gear samples only surface organisms on the bottom and 205 -7- those free in the water. Animals burrowing in the bottom sediments are not collected. Further, such samples are not quantitative and no valid estimates of numbers of individuals per unit area are possible. ■ Concerning future studies, the University of Miami report recommended: 1. Extensive sampling from shore to two meters depth — especially mangroves (source of organic materials) and turtle grass (nursery for commerically important species as well as many others) — selected sites, about six on each coast, for detailed studies, 2. A series of transects from 2-10 meters depth — most connnerical fisheries located here (shrimp, lobster, scallops) — from a mother ship by smaller boats. 3. Additional, deeper (10-800 meters) collections to fill gaps in the initial sampling pattern. 4. Extend sampling area west to Costa Rica on both coasts and east to Cartegena, Colombia, on the Atlantic and to Cabo Corrientes, Colombia, on the Pacific and include quantitative sampling throughout. 5. Concentrated work on life histories of commerically important species (shrimp, lobsters, scallops, oysters, certain crabs, mantis shrimp and fish) as well as the sea snake a^d crown of thorns starfish. 6. Research to determine physiological adaptations of various animals. 206 -8- 7. Studies to elucidate genetic similarity and differentiation. 8. Hydrographic studies on both coasts (salinities, temperatures, currents from surface to bottom) , TTie Miami survey included predictions concerning the effects of a sea-level canal, chief among which was, "We foresee little or no change of a nature detrimental to the economics of the fisheries, either commer- cial or sports, as it is unlikely that existing commerical stocks would be replaced by other species." As part of the 1970 Atlantic-Pacific Interoceanic Canal Study Commission report, the Battelle Memorial Institute, drawing heavily upon the work of the University of Miami, reported on "Possible Effects on Marine Ecology," The report is also based upon literature searches and a contracted oceanographic survey. Its recommendations were to: 1. Establish study areas: 20 mile radius at each end of selected route. 2. Conduct oceanographic and ecological surveys in each area. 3. Collect biological and environmental samples for later studies and analyses . 4. After determination of communities and habitats, establish a network of permanent study stations at each major ecosystem type and schedule reoccupation for sampling and necessary habitat parameters. 5. To carry out theoretical studies to determine the parameters needed to simulate and predict hydrodynamics of completed canal. 207 -9- 7. Select "typical" species of different communities, habitats, and biotic groups for laboratory experiments, 8. Make special studies of the ecology of disease organisms and parasites. 9. Prepare interim and final reports. In accordance with its reliance upon the University of Miami study, the Battelle Memorial Institute concluded that "... the biotas of the two oceans would probably mix to some extent with the opening of an isthmian sea-level canal. The evidence suggests that relatively few species would survive and become established in their new environment and would not likely produce catastrophic ecological effects . However, the results are based on very few data so that they are not conclusive." In 1969 the Atlantic-Pacific Interoceanic Canal Study Commission requested that the National Academy of Sciences examine the ecological issues implicit in the construction of a sea-level canal through the Isthmus of Panama, with special reference to the marine environment. Th§ Commission further requested a program of research that might appropriately be done before, during, and after the construction of the canal, with a view toward assessing the ecological impact of a canal and minimizing ecological damage that might in fact occur. To this end the Academy convened an eleven-member "Committee of Ecological Research for the Interoceanic Canal" and two ad hoc subcommittees, one on Oceanography (eight members) and one on Hydrology (four members) . The Committee drew upon the expertise of nearly 170 individuals in arriving at their conclusions. 208 -10- Chief among the Academy's conclusions was that a sea- level canal, without fully effective barriers, would allow biotic interchange, "... the consequences of which are unknown." Recommendations by the Academy's committee were to provide for: 1. International cooperation in subsequent studies. 2. Studies on the nature and extent of natural- and fishery- induced population changes. 3. Studies on animals and plants of medical importance. 4. Additional data on hydrology of sea- level canal. 5. Oceanographic studies of nearshore, coastal, and offshore areas. 6. Continuing studies of planktonic and pelagic organisms. 7. Sampling of the marine biota to a depth of 100 meters, Colombia to Costa Rica (both coasts), especially near openings of canal — on the Pacific side, in upwelling (Gulf of Panama) and non-upwelling (Gulf of Chiriqui) areas. 8. An inventory of the marine biota, determination of com- munity composition, and physiological tolerances and para- sites and disease-causing organisms of dominant components with special emphasis on the biota of coral reefs and of the subtidal soft bottom environment. 9. Establishment of biota banks. 10. Studies on the biology of dispersal of and colonization by selected organisms with laboratory experiments on tolerances, larval longevity, and life cycles. 209 ■n- 11. Determination of taxonomic, genetic, and physiological dif- ferences between the same and geminate species of the two oceans . 12. Determination of food habits. 13. Consideration of biotic barriers, especially the action of tidal gates and freshwater- thermal barriers. 14. Survey of parasites and pathogens — especially those of species of actual or potential economic inqportance . A detailed sampling program was presented, emphasizing areas of the soft bottom shelf and coral reefs. The program included the deter- mination of species composition, relative abundance, species diversity, faunal boundaries, patterns of distribution, and size- frequency distribution. In August, 1977 the National Academy of Sciences was called upon by the Director, Office of Science and Technology Policy, Executive Office of the President, to respond to four specific questions intended to assess inprovements in the state of knowledge since the publication of the report of the Atlantic- Pacific Interoceanic Canal Study Commission in 1970. A seven-member "Committee on Ecological Effects of a Sea Level Canal" heard statements from 24 experts and received written statements from 23 others . The Committee's conclusions were: 1. A sea-level canal would allow interchange of marine organisms, mostly from Pacific to Atlantic, and some would colonize the new habitat. 210 -12- 2. Many direct and indirect effects of colonization can be anticipated. These may be due to alteration of predator-prey relationships, genetic and behavioral interaction among similar species, introduction of new competitor species, and invasion by disease organisms. 3. A barrier system is necessary to limit the movement of organisms through a new sea-level canal or through the existing canal if the lockage water is made more saline. 4. Research should be undertaken to determine the environmental effects both of a sea- level canal and of any significant modifications of the existing canal. In general the Smithsonian endorses the recommendations made by the University of Miami concerning nearshore and offshore surveys. We have incorporated a number of the University's suggestions into our con- sideration of an isthmian offshore survey. We believe that offshore sampling should be restricted to the continental shelf (depths of 10 to 200 meters) and be carried out just before the end of the dry season (March) and again just before the end of the wet season (October) . The second sampling will allow an evaluation of the effects of freshwater runoff with its concomitant load of nutrients and sediments . The program should include 237 stations, 96 off the Atlantic coast and 141 off the Pacific coast, as follows: Atlantic : 18 transects, averaging four stations per transect, at 40-mile intervals, from the northern border of Costa Rica 211 -13- to Santa Marta, Colombia. 7 stations, Laguna de Oiiriqui (Panama); 6 stations, Golfo de San Bias (Panama); 6 stations, Golfo de Darien (Uraba) (Panama/ Colombia); 5 stations, Golfo de (forrosquillo (Colombia). Pacific: 22 transects, averaging four stations per transect at 40-mile intervals, from the northern border of Costa Rica to Buenaventura, Colombia. 7 stations, Golfo de Nicoya (Costa Rica); 7 stations, Golfo Dulce (Costa Rica); 4 stations, Bahia Monti jo (Panama); 4 stations, Bahia de Parita (Panama); 3 stations, Bahia de Chame (Panama); 22 stations, grid in Golfo de Panama (Panama); 6 stations, Golfo de San Miguel (Panama) . Activities at each station would include determination of salinity and temperature profile, surface to bottom, by a salinity-temperature-depth recorder; determination of light penetration into the seawater by a recording transmissometer; large water samples for deteiminatio of suspended solids at surface-, mid- and near-bottom; water samples at surface-, mid- and near-bottom for nutrient analyses; one oblique plankton tow, bottom to surface; discrete-depth plankton tows, surface-, mid- and near-bottom; one 10 ft. and one 40 ft. otter trawl collection; six replicate quantitative bottom samples, O.lm^, to be sieved against a 0.5 mm mesh screen; and one bottom sample for sediment analysis, which would yield the following. Totals: 474 temperature and salinity profiles 474 transmissometer records of light penetration 212 -14- 1422 determinations of suspended solids 1422 water nutrients analyses 474 oblique plankton tows 1422 discrete-depth plankton tows 948 qualitative trawl samples 2844 quantitative bottom samples 474 sediment analyses Tlie current Bureau of Land Management offshore surveys offer a source of realistic estimates of manpower requirements for the analysis of the 3804 bottom samples projected by an isthmian offshore survey. However, several caveats should be noted: (1) by and large all BLM surveys deal with less diverse populations than are expected to be encountered in a Panamanian survey; the following may, therefore, be underestimates; (2) identifications have been made by persons with rather little experience in taxonomy; if experienced personnel were recruited, the following are probably overestimates; (3) the fauna encountered in the BLM surveys is relatively better known than the offshore fauna of an isthmian survey; thus, the following may be underestimates. To analyze about 1400 suspended solids samples, two man-years. To analyze about 1400 water nutrient samples, two man-years. To analyze 474 sediment samples , one man-year. To sort animals to major groups from about 2800 samples, 18 man-years. To identify marine worms (which may comprise as much as 75% of the biomass and/or species in a given sample) from about 2800 samples, 14 man-years. 213 -15- To identify microcrustaceans from about 2800 samples, three man-years. To identify molluscs from about 2800 samples, two man-years. To sort about 1900 plankton samples to major groups, 15 man-years. To sort 948 trawl collections to major groups, one man-year. The identifications of animals not specifically mentioned and of plants and planktonic organisms must be added to the foregoing personnel/ time data. Assuming six hours on station and five hours to travel between adjacent stations, 119 days each are required for the wet and dry season collections, exlusive of travel time from home port to Panama. Ship-time charges are about $5,500 per day for a ship large enough to carry out the required survey operations; ship- time charges for the survey alone would be approximately $1.3 million. In order to carry out each phase of the survey within a reasonable time period (about eight weeks each, dry and wet seasons), two ships would be required. In addition, salaries for a scientific crew of 10-12 persons per ship must be considered. Nearshore collections (depths from 2 to 10 meters) should be carried out at stations coinciding with the transects of the offshore survey at two stations for each transect. The deeper station should be occupied by a jDother ship and the more shallow by small boats deployed from the mother ship. The same spectrum of samples should be taken as in the offshore survey, so at least two small boasts will be required to manage the necessary equipment for the more shallow stations. This phase of collecting will include 36 stations in the Atlantic and 44 in the Pacific, each occupied in both wet and dry seasons. TWo ships. 214 -16- smaller than those required for the offshore survey, would be necessary, one in the Atlantic and one in the Pacific. Allowing 1.5 days for each station the nearshore survey would require 54 days in the Atlantic and 66 days in the Pacific, in each of the two seasons. Thus, at $500 a day, ship-time for this phase would amount to $120,000. The time involved in analysis of the samples from nearshore collections is approximately half of that cited for the offshore survey. The shallow depths are important to the overall survey, not only because they were not sampled during the University of Miami survey, but because they support fauna of potential economic importance, being the location of most of the commercial fisheries of the area (shrimp, lobsters, and scallops) . Due to the inaccessibility of much of the coastline from land, close inshore collections (depths from to 2 meters) should be carried out from established settlements. Parties of divers and shore collectors and equipment can be flown in and out of a number of sites along both coasts, others being accessible by surface travel. Possible localities include: Atlantic Pacific Limon, Costa Rica Punta Arenas, Costa Rica Bocas de Toro, Panama Puerto Armuelles, Panama Limon Bay, Canal Zone Las Tablas, Panama Porvenir, Panama Aguandulce, Panama Aligandi, Panama Panama City, Panama San Onofre, Panama La Palma, Panama Cartegena, Colombia Bahia Pinas, Panama Santa Maria, Colombia Nuqui, Colombia Buenaventura, Colombia 215 -17- The time spent at each of these localities will depend iqpon the number of habitats available. Collections from mangroves and sea grass beds will be emphasized for the former are a source of organic material for the inshore community as a whole and the latter are the nursery grounds for a large number of species of economic importance as adults. At least four days should be allowed at each of the sites; thus, at least 32 days of collecting on the Atlantic coast and at least 36 days on the Pacific during both the wet and dry seasons. Collecting parties should consist of six to eight persons. The time, personnel, and fiscal requirements for laboratory work are difficult to assess. In order to carry out the necessary observations on life cycles and behavior patterns, experiments to determine chemical and physiological tolerances, and comparisons between Atlantic and Pacific species, one must expect that no less than fifteen teams of workers will be involved. Each team might consist of a research scientist and as many as four assistants working for as long as six months or a year. Ihe specialized equipment needs of the teams are another factor difficult to assess. Nonetheless, it is anticipated that all surveys and laboratory work will involve the close cooperation of Panamanian and American scientists and students. A number of scientists have indicated active interest in participating in research projects designed to assist in determining the environmental effects of an interoceanic sea-level canal. The following is a listing 216 -18- of them, the institutions with which they are associated, and their areas of experience. Smithsonian Institution National Museum of Natural History Botany Entomology Invertebrate Zoology Dr. Mason Hale - lichens Dr. David Lei linger - ferns Dr. James Norris - algae Dr. Donald Davis - moths Dr. Teny Erwin - beetles Dr. Oliver Flint - stone flies Dr. Paul Spang ler - beetles Dr. Thomas Bowman - copepods Dr. Arthur Clarke - molluscs Dr. Robert Higgins - kinorhynchs Dr. Meredith Jones - annelids Dr. Raymond Manning - shrimp, crabs Dr. David Pawson - echinoderms Dr. Klaus Ruetzler- sponges Paleobiology Vertebrate Zoology Office of the Director Dr. Martin Buzas Dr. Jack Pierce - - foraminifera sediments Dr. Charles Handley - mammals Dr. Richard Thorington - mammals Dr. Frank Ferrari - copepods Dr. Gordon Hendler - echinoderms Smithsonian Oceanographic Sorting Center (for sorting collected biological material) Fort Pierce Department of Interior associates (Fish jind Wildlife Service) N.O.A.A. associates (National Marine Fisheries Service) Dr. Robert Gore - crabs Dr. Michaels Bogan - mammals Dr. Clyde Jones - mammals Dr. D. Wilson - mammals Dr. Alfred Gardner - mammals Dr. I. Perez-Farfante - shrimp 217 -19- Other Research Scientists *Dr. Richard Barber - [hike University - biological oceanography *Dr. Lawrence Abele - Florida State University - crabs, shrimp *Mr. C. E. Dawson - Gulf Coast Research Lab. - fish **Dr. Richard Rosenblatt - Scripps Institute of Oceanography - fish *Dr. Robin Overstreet - Gulf Coast Research Lab. - parasites Dr. Charlotte Mangum - College of William and Mary - invertebrate physiology *Dr. Howard Sanders - Woods Hole Oceanography Institute - conmiunity ecology *Dr. Geerat Vermeij - University of Maryland - predator-prey raltionships Drs. Bruce Menge/Jane Lubchenko - Oregon State University - rocky intertidal ecology *Dr. William Newman - Scripps Institute of Oceanography - barnacles, fouling communities *Dr. Jeffrey Graham - San Diego State University - fish physiology Dr. Michael Greenberg - Florida State University - mollusc physiology Dr. Kerry Clark - Florida Institute of Technology - opisthobranch molluscs *Dr. Sylvia Earle - California Academy of Science - algae *Dr. Deborah Dexter - San Diego State University - ecology of sandy beaches Dr. Sarah Woodin - Johns Hopkins University - shallow water ecology *Dr. J. C. Zeiman - University of Virginia - ecology of sea grasses, mangroves Dr. John Ogden - West Indies Lab (Fairleigh-Dickinson) - ecology of sea grasses, mangroves *Dr. C. R. Robins - University of Miami - fish ♦Participant in NAS hearings, September 1977 **hfember of NAS Committee, September 1977 Proposals to modify the present canal have included the construction of a third set of locks in order to transit larger ships. These larger locks would increase demand on the water simply afforded by Gatun Lake and the Chagras River. Due to an increased number of transits through the Canal, augmentation of this water supply will be required. The 1970 report suggests three possible solutions to this problem, the least costly of which is pumping sea water into Gatun Lake. Over time the lake could become progressively more saline and would stand as a high-level connection between the Atlantic and the Pacific. 218 -20- Smithsonian scientists have carried out research projects in all six of the lock chambers of the present canal . They have found that the salinity of the chambers is reduced as one ascends toward Gatun Lake, so that an effective freshwater barrier for the bast majority of marine animals extends from Miraflores Lake, on the Pacific side, through the Pedro Miguel Locks and Gatun Lake, to and including the upper chamber of the Gatun Locks, on the Atlantic side. Further, they have found that a total of 165 different species are present in the lock chambers, 126 in the Pacific series, and 57 in the Atlantic series. Of 19 species common to both sides of the lock system, 11 can live in fresh water and probably live in Gatun Lake; populations of the remaining eight species are separated by the lake and from two to four lock chambers, suggesting a fortiutous transit of the canal sometime in the past. All of the 19 species are fouling organisms or associated with such, which suggests how the fortuitous transit might have occurred. A graph showing species distribution is attached to this statement. The presence of 19 species in common, more than half of which are freshwater species, of a total of 165 species encountered does not sub- stantially alter the effectiveness of Gatut Lake as a barrier to the trans- isthmian migration of marine invertebrates. It is felt that any salinization of Gatun Lake will break this barrier and allow indiscriminate interoceanic migrations of marine animals. In this case we would once again be faced with the problem of evaluating the ecological consequences of mixing Atlantic and Pacific species, and the basic biological survey and the subsequent laboratory work called for earlier would still be necessary. 219 -21- In the event that neither a sea-level canal nor a modified lock-lake canal develops in the future, the biological and hydrographic work would not be wasted effort, for it will provide the means for answering some of the basic questions of biology. The biota of the two coasts of Panama represent the end result of a three to five million year separation of a once continuous simple biota. Since the establishment of the isthmian land barrier the two separated biotas have evolved independently, some species rapidly, some species little, if any. Thus, on the two sides we find the same species, with little evolution over time; we find closely related, but different species, with a rapid evolution over time. These are the raw materials required to understand how evolution has taken place and how a species becomes established. The specimens obtained through the biological survey will show structural differences, differences in reproductive behavior, and differences in protein chemistry which are directly attributable to a known time period of isolation. Studies of the specimens will also shed light on problems concerning the geographic distribution of species, and physiological experiments will provide valuable insights into how organisms cope with the vagaries of their environment. Nearly everyone who has speculated upon the ecological effects of a sea-level canal has mentioned the efficacy of barriers in the canal system. These would prevent the interoceanic movement of plants and animals from one ocean to another. A number of possible types of barriers have • 32-461 O - 78 - 15 220 -22- been suggested but none have been tested, so far as is known. Whether the barrier be thermal, chemical, or electrical, it must be 100% effective. The extremely large masses of water moving through a sea-level canal make the problem unprecendented, so that answers applicable in smaller situations may offer no solution here. There must be adequate engineering and biolobical research before decisions about kinds of barriers to employ, and the decision to include the barriers must be made during the planning phase of the canal, not after it is realized that some plant or animal, which will create a catastrophe, has already passed through to the other side. In summary, may I again point out that there was insufficient bio- logical and hydrographic data available in 1970 to make valid predictions of the ecological consequences of a sea-level canal. The situation is no different in 1978. We believe that biological and hydrographic studies are crucial to informed decision-making with respect to such an endeavor. 221 Dr. Challinor. Mr. Cliairman, members of the subcommittee. I appreciate the opportunity to appear today to discuss the im- portance of an ecological study as a prelude to consideration of a sea- level canal. The Smithsonian Institution, it should be noted, holds no position on whether or not an Atlantic-Pacific interoceanic sea-level canal should be built. The Institution does, however, support implementa- tion of the recommendations of the 1970 report of the Atlantic-Pacific Interoceanic Canal Study Conunission, particularly with respect to biological and hydrographic surveys. And I might interrupt here a minute to introduce, on my left. Dr. Meredith Jones, who is curator in the Department of Invertebrate Zoology — who has done a great deal of research work in Panama — at the Museum of Natural History. The Smithsonian's work in Panama dates from the 1920s and in- cludes the establishment of its tropical research institute in 1946. Originally, its emphasis was on terrestrial and fresh water habitats, but in 1965 marine facilities were established at each end of the canal, one at Naos Island on the Pacific entrance and the other at Galeta Island on the Atlantic. The Naos laboratory has a permanent pro- fessional statf of five and laboratory space for up to 30 visitors ; the small Galeta laboratory has one professional staff member and space for up to 12 visitors. Other Smithsonian units are also carrying out research in Panama including the radiation biology laboratory which maintains solar radiation monitoring equipment on Flamenco Island, close to the Naos Island laboratory. Since May, 1971, scientists from the Museum of Natural History have been making general collections of marine invertebrates both in the Zone and nearby Panamanian waters. Spec- ial effort has been made to collect biological material from the lock chambers of the canal whenever they are drained for routine main- tenance. All of these collections represent, on a very small scale, an attempt to accumulate base line samples of biological specimens. In the event of construction of a sea-level canal, these samples could help form the "before" part of studies to show the effects of such a canal. The ecological effects of a sea-level canal are, we believe, inevitable, and will effect the human population as well as the freshwater and marine flora and fauna. We believe that the greatest impact however will be on the marine environment. The ultimate evaluation of the results of mixing the water and the biota of both oceans might only be done when all appropriate sur- veys have been made and species identified. The crucial point of de- parture, heretofore absent in reports and speculations about the effects of a sea-level canal, is this complete biological base line survey. Everything that follows — all of the natural history observations, all of the behavioral and physiological experiments, all of the predic- tions and speculations — must be founded upon a firm taxonomic base. We must know the ecological requirements of species in their pres- ent, normal environment. We must know how plants and animals of a given locale interact to form communities. 222 We must know which plant and animal species are hosts for which parasites, and which disease-causin<^ organisms affect which species. We must Icnow their life cycles and the limits under which they can survive, and finally we must compare the plants and animals of the Atlantic Ocean with those of the Pacific. Only when all of this is done can proper assessment of the possible environmental effects of such a canal be made. There have been only two important surveys on the isthmian region which bear on the ecological implications of a sea-level canal. The first survey, an oceanographically oriented project, was concerned with the Bay of Panama and done by the Inter- American Tropical Tuna Commission in 1965-G(). The second, the only really large scale biological study of the region, was done by the X^niversity of INIiami in 1966 and 1967. In addition to recommending a biological and hydrographic sur- vey, the University of Miami concluded that "We foresee little or no change of a nature detrimental to the economics of the fisheries." As part of the 1970 Atlantic-Pacific Interoceanic Canal Study Commission report, the Batelle Memorial Institute, drawing heavily upon the work of the University of Miami, reported on "Possible effects on jNIarine Ecology."' Although they also recommended a sur- vey, they concluded that the biotic mixing would not produce cata- strophic ecological effects. The Commission however then requested the National Academy of Sciences also to examine the ecological issues associated with a sea- level canal, and in addition to recommending again a biological and hydrographic survey, the Academy concluded that a sea-level canal without fully effective barriers would allow biotic interchange, the consequences of which would be unknown, a conclusion somewhat different from that of Battelle. In August 1977, the National Acadeoiiy was asked to comment on improvements in the state of knowledge since 1970 report. The 1977 Academy committee received testimony and its conclu- sions were four: One : A sea-level canal would allow interchange of marine organ- isms. Two: Many direct and indirect effects of colonization could be anticipated. Three : A barrier system would be necessary to limit the movement of organisms. Four: Research should be undertaken to determine the environ- mental effects both of a sea-level canal and of any significant modifi- cations of the existing canal. The Smithsonian strongly urges the initiation of a biological and hydrographic survey, the analysis of the collected data and materials, the pursuit of detailed ecological studies, and the carrying out of experimental research to determine tolerances. We also believe there must be concomitant terrestrial studies at all potential canal sites, including a thorough inventory of plants and animals to evaluate the environmental impact of the effect of excavations. If, as an alternative to a sea-level canal, the present canal was modified to increase its capacity by pumping salt water into Gatun I 223 Lake, the present fresliwater of that hike would no longer be a bar- rier to tlie movement of salt water organisms. In this case, we would again be faced with the same problem that would exist with a sea- level canal, and it would require the same surveys as called for earlier. If neither the sea-level nor the salt water modification of the exist- ing canal is carried out, the proposed surveys would still be very valuable to explain how" two dilTerent marine biological communities have evolved during the 8-5 million years they have been separated by the isthmus. Further, such i)ractical results as the identification of new potential valuable seafood species might be uncovered. Any biological survey, including the one just described, is a very slow process. It is unrealistic to expect that it can be done properly in 4 years. The identification of species alone would take at least that much time even if all specialists could be mobilized to do so. In addition, these studies must be undertaken in full cooperation with our Panamanian colleagues, and they should share fully in the design of the work. Some time and cost statements have been included in the detailed statement submitted for the record. In summary, there was insuflficient biological and hydrographic data available in 1970 to make valid predictions of the ecological consequences of a sea-level canal and the situation is no different in 1978. That is the summary of my statement, Mr. Chairman. Mr. Metcalfe. Thank you very much. Dr. Challinor. First, let me ask unanimous consent that the 1977 report of the National Academy of Sciences — a very important report on the eco- logical effects of a sea-level canal — be entered into the record, because it would be very germane to our hearing. [The study fbllows :] 224 NATIONAL RESEARCH COUNCIL COMMISSION ON NATURAL RESOURCES 2101 Coitttilulior. Avenur Wa>hjn|lor D C JMIt ENVIRONMENTAl STUDIES BOARD September 28, 1977 The Honorable Frank Press Director Office of Science and Technology Policy Executive Office of the President Washington, D.C. 20500 Dear Dr. Press: This letter is in response to your August 1, 1977 request to the National Academy of Sciences for an assessment of the potential eco- logical effects of an interoceanlc sea level canal across the American Isthmus. As requested, this letter report provides an assessment of improvements in the state of knowledge since the 1970 publication of the report and appendices of the Atlantic-Pacific Interoceanic Canal Study Commission! concerning: - potential migration of marine organisms through a sea level canal; - potential ecological effects of any such migration; - natural or man-made barriers that might mitigate the effects of any such migration; and - other potential environmental effects of a sea level canal. Summary Statement The Atlantic-Pacific Interoceanic Canal Study Commission concluded Chat "the risk of adverse ecological consequences stemming from construc- tion and operation of a sea level canal appears to be acceptable," a Judgment apparently based on considerations other than scientific informa- tion on potential environmental effects. Our Committee felt that available data are inadequate to reach a definitive conclusion concerning the overall magnitude of risk a sea level canal would pose to the marine environmeTin . The Conmlttee concluded, however, that Che modest advances in knovledg' ^Interoceanic Canal Studies 1970 . Washington, D.C: Atlantic-Pacific Interoceanic Canal Study Commission (APICSC) . 225 The Honorable Frank Press September 28, 1977 Page 2 since the Connnisslon report generally confimi the susceptibility of the region's marine comniunities to potential disruption from mixing of the Atlantic and Pacific biotas. Marine organisms would undoubtedly pass through a sea level canal. The lack of adequate information prohibits either the identification of all species that would migrate or the prediction of specific ecological consequences, but there is convincing evidence that such migration has substantial potential for adverse effects. Consequently, a barrier system would be necessary to restrict migra- tion. The movement of water through a sea level canal should be kept to a minimum. The feasibility and effectiveness of thermal, salinity, chemical, or other novel types of artificial barriers cannot be established with data and analyses presently available. The protection afforded by the fresh water barrier in the present canal, however, Indicates the desirability of maintaining a comparable fresh water barrier in any inter- oceanic canal. Study Procedures The Acaden>' assigned responsibility for the study to its Environmental Studies Board, which assembled an ad hoc committee of experts to survey available information and prepare a report. Members of the Committee on Ecological Effects of a Sea Level Canal were: Alfred M. Beeton (Chairman), Great Lakes and Marine Waters Center; James K. Carpenter, Rosenstiel School of Marine and Atmospheric Sciences; Peter W. Glynn, Smithsonian Tropical Research Institute; John E. Hobble, Marine Biological Laboratory, Woods Bole; James J. O'Brien, Florida State University; Richard H. Rosenblatt, Scrlpps Institution of Oceanography; and Ira Rubinoff, Smithsonian Tropical Research Institute. The Committee proceeded as rapidly as possible, recog- nizing that the hazards of a limited review were balanced by the value of a timely assessment. In accordance with your request, the Conmlttee largely restricted its investigation to potential effects on the marine environment. The Conaittee recognized that this emphasis excluded full treatment of other types of environmental impacts, including terrestrial, social, and cultural effects, that are considered essential to assessments of engineering projects of the magnitude of an interoceanlc canal. The Committee also recognized that an ultimate determination of the advisability of a sea level canal will rest la part on the evaluation of economic and other nonenvironmental factors that are beyond the scope of its review. 226 The Honorable Frank Press September 28, 1977 •Page 3 The Conmittee considered potential effects of an interoceanlc passage built at sea level by conventional technologies and located within the geographic range considered in earlier studies. Because the effects on the marine environment would be similar to those of a sea level canal, the Committee also gave consideration to aodif ications that could lead to s-alinization of the present locked canal. The Committee reviewed relevant information from the 1970 Study Commission report, the reports submitted to the Study Commission by Battelle Memorial Institute^ and an earlier NAS comsittee,^ and other materials, including recent scientific papers and an annotated bibliography of relevant information that has become available since 1970. To augment its members' direct familiarity with the subject, the Committee arranged to have twenty-four experts make brief presentations at its meeting held on September 1-2. They were asked to summarize find- ings in their fields since 1970 that impinged on the Study Commission conclusions, to comment on the validity of the observations and conclu- sions of the earlier reports, and to identify major research needs. About sixty persons attended the open discussion sessions. The Committee also received solicited comments from twenty-three other scientists with rele- vant research experience. Lists of contributors are attached. Findings Although thftre are exceptions in particular subfields, the general state of knowledge has not improved significantly since the publication of the Study Commission report in 1970, and the imposing uncertainties identified in that extensive study remain largely unresolved. Although recently reported advances 'have augmented our empirical knowledge of the species and the marine communities of the region, the lack of central coordination has led to uneven progress in these fields and to virtual neglect of other crucial information needs, most notably on the feasibility and effectiveness of barriers to migration. The marine floras and faunas of the Caribbean and Eastern Pacific have developed into discrete biotic assemblages in the millions of years since the Isthmian land barrier was established between the two oceans. The Caribbean area Is tropical, with clear, warm, nutrient-poor waters. ^Battelle Memorial Institute (1970) Possible Effects On Marine Ecology. Appendix 16, Interoceanlc Canal Studies 1970. Washington, D.C.: APICSC. National Research Council (1970) Marine Ecological Research For The Central America Interoceanlc Canal. Appendix 16, Interoceanlc Canal Studies 1970. Washington, D.C.: APICSC. 227 The Henorable Frank Press September 28, 1977 Page it The Pacific In the Isthmian region Is also tropical, but is subject to seasonal upwellings that result in the presence of cool, turbid, nutrient- rich waters for about four months of the year. The mean sea level on the Pacific side is slightly above that of the Atlantic. The Pacific side undergoes tidal fluctuations of about 6 meters, whereas the tidal range on the Atlantic side is only about 0.5 meters. The present gravity- operated Panama Canal obtains its loclcage water from the man-made, fresh water Gatun Lake, which Is 83 feet above sea level. This configuration inhibits the migration of organisms and Che Panama Canal has not signifi- cantly affected the integrity and Isolation of the Pacific or Atlantic biotas. Historically there has been considerable apprehension that a direct salt water connection between the oceans would allow biotlc inter- change that could lead to severe ecological disruption. I. A sea level canal would provide a pathway for an interchange of marine organisms, with most movement from Pacific to Caribbean because of the difference in mean sea levels. Some Immigrating organisms would successfully colonize their new habitat . Marine organisms may disperse actively or may be transported passively by such means as ocean currents and rafting. The Committee confirms the Study Commission finding that a saline canal could provide a habitat for many species and could permit survival of many other species during the period they would require to migrate from one ocean to the other. Migra- tion by adult organisms is by no means the only consideration, for most bottom-dwelling animals have pelagic larvae and thus a dispersal phase that is capable of passive transport, sometimes for great distances. Tropical species typically have long-lived pelagic larvae, most of which would be capable of passing through a salt water canal. Available information does not allow identification of all species that would migrate. For one thing, there is no adequate inventory of marine organisms in the area. The Battelle report estimated that there are about 10,000 marine species along the coasts of Panama (of which only 1,000 species are common to both oceans), and that many species would be added by new surveys. Few new surveys have been undertaken and these have been conducted mostly at shallow depths; there is a critical absence of coastal taxonomic surveys from subtidal to 100 meter depths, an area thet is beyond the reach of shore parties and is rarely sampled by deep water research vessels. Furthermore, ■ the life stages of few species have been described fully; for example, the Committee was informed that the node of development was known for only about 5 percent of the area's invertebrate benthic species, which coomonly prove to have pelagic ' larvae. Although there are seasonal variations, the mean sea level of the Pacific is higher than that of the Caribbean in the vicinity of proposed 228 The Honorable Frank Press September 28, 1977 Page 5 canal routes. If unobstructed by a physical barrier, a sea level canal would permit substantial net water flow from Pacific to Atlantic, although mathematical models indicate that there may also be occasional reverse transport of Caribbean waters. Tidal gates could, in theory, be used to control flow direction and race, but economic considerations may dictate long unobstructed periods that would result in considerable interoceanic water transfer. Past experience demonstrates that some of the Introductions of species into new environments will result In successful colonization. Many exam- ples of Buch colonization are known for terrestrial, fresh water and estuarine organisms. Examples of biologically successful Introductions are less conspicuous in the marine environment, but a number of intentional and accidental marine colonizations are known. As a result of the opening of the Suez Canal 118 species of Red Sea fauna had become established in the eastern Mediterranean and 14 had made the reverse migration by 1967. In 1971 Red Sea species constituted nearly 20 percent of Israeli trawl catches. In some cases Mediterranean species have declined in response; for example, Oratosquilla nassivensis , a Red Sea species, was first collected from Egypt and Palestine in the mid 1930s. Now abundant In the Eastern Mediterranean as far north as Turkey, it has essentially replaced Squills mantis , the native Mediterranean species. Charybdis longicollis , a Red Sea crab considered a pest by fishermen, arrived in the Mediterranean after 1958, and by 196A had become very abundant. Portunu s pelagicus . another Red Sea crab, has made its way to Sicily, where it now forms a commercial fishery. These findings and others Indi- cate that colonization nay follow the opening of potential pathways by a matter of decades. It has been suggested that there has already been extensive migration of many marine organisms through the present canal in the ballast tanks of ships. The Committee feels that such transport probably occurs, but only infrequently leads to colonization. Ballast water carries predomi- nantly planktonic species, most of which are already present in both oceans. Ships generally hold ballast waters for long periods in metal tanks that are inhospitable and may contain paint and other materials that are toxic to marine organisms. Ballast tanks are usually pumped out at distances from the canal while the ship is under way, so any organisms surviving tank conditions and the mechanical rigors of pumping are likely to be widely dispersed at densities below those required for a successful colonization. The volumeof water in ballast tanks is small compared to the amount that would be transported through a 'sea level canal. The case of ballast transport does not present adequate evidence for an assess- ment. of the potential transport of organisms through an interoceanic canal. 229 The Honorable Frank Press September 28, 1977 Page 6 II. Many direct and indirect effects of colonization can be anticipated . These effects may be produced by a lteration of predator - prey relationships, genetic and behavioral interaction among similar species, introduction of new competitor species, and invasion by disease organisms. A sea level canal would also produce important local effects . The introduction of plant and animal species into new areas has fre- quently produced severe irreversible ecological effects, some of which have been detrimental and some beneficial. The direct consequence of migration and colonization may be a marked change in the abundance of particular species by one of the adjustment mechanisms discussed below. In some cases the result may be considered favorable, as with the estab- lishment of new commercial or sport fisheries; in other cases, however, the outcome may be harmful overpopulation, local exclusion, or even extinction. A change in abundance may have itmediate and visible signifi- cance, as in the case of the blocked channels and reservoirs that resulted from the introduction of the water hyacinth to Florida and Africa. In other cases, the ecological effects are as significant but less publicized; for example, the recent accidental Introduction of the marine algae C odium to the northeast coast of the U.S. has had an unexpected harmful effect on clans; the algae adheres to the clams and results in their being carried away by currents. Many introductions have exacted an enormous economic and human toll: the invasion of the Great Lakes by the sea lamprey, the inhabitation of Australia by rabbits, and the introduction of human disease organisms to previously unaffected populations illustrates the variety and magnitude of these costs. As significant, perhaps, are the indirect effects of changes in species abundance, a shift to a new ecological equilibrium that may in- volve many other species or entire communities. In the North Pacific, for example, the virtual extermination of the sea otter led to a great abundance of sea urchins, which in turn resulted in a marked reduction In beds of its food, the giant kelp. These kelp beds are important in the ecology of many fishes and invertebrates. Of special concern in Central America are the coral reefs and sea grass meadows, since they are the basis for complex and fragile communities, and a plausible effect of interoceanic introductions would be major changes in these communities. Ecological imbalance can be produced from new colonizations by several means. Predators and their prey are coadapted in their natural environments, and the introduction of a new predator can have profound effects on naive prey species. The extermination of terrestrial Island species by Introduced predators is well known. The Introduction of the oyster-drill In England and the West Coast of the U.S. has had detrijoental effects on oyster fisheries. While a full accounting is impossible with 230 The Honorable Frank Press September 28, 1977 Page 7 present information, several potential predators that could migrate through a sea level canal can be identified. For example, three eastern Pacific predators of coral may be cited, all of which lack ecological equivalents in the western Atlantic. Coral reefs in the Caribbean may lack natural defenses against these predators, a gastropod snail (Jenneria ) . a starfish (Acanthaster) , and a group of puff erf ishes ( Arothron ) . A number of other conspicuous predators now present in only one ocean could pass through an unrestricted sea level canal: the eastern Pacific yellow- bellied sea snake (Pel amis) Is perhaps the best-known example, while the Pacific may be colonized by the great barracuda ( Sphyraena barracuda ) and the Portuguese man-of-war ( Physalia physalis ). Conversely, some otherwise inoffensive migrants may be able to colonize in the absence of their natural enemies. Liberated from predators or competitors, they may experience uncontrolled population growth and deplete limited resources at the expense of native species. Because Caribbean and eastern tropical Pacific organisms have evolved into distinct but still closely related species, there are many hundreds of genetically similar pairs of species on opposite sides of the Isthmus. This fact further complicates the already difficult task of forecasting the results of faunal mixing. It Is possible, for example, that morpho- logically similar species may err in mate selection, leading to unsuccess- ful attempts to reproduce. Some scientists have expressed concern about the ecological consequences of hybridization when Interspecific reproduction does succeed. For example, offspring may inherit characteristics that leave then less able to cope with stress than their progenitors. On the other hand, in some instances hybrid species could prove superior competi- tors or conaaercially more valuable. Widely accepted ecological theory holds that species with identical resource requirements cannot coexist. Compounding the potential problem of the Introduction of new competitors is the morphological similarity of many of the interoceanic species pairs, which suggests that many will have common resource requirements. In this case, introduction will Inevitably lead to competition, and a possible result of direct competi- tion is local extirpation or extinction of the less efficient competitor. The Committee noted that while there Is at least fragmentary background Information on potential predators and competitors, the most significant ecological hazard could be the Introduction of virtually unknown parasites and pathogens. There has been scant Investigation of .marine diseases and their propagation, even for commercially Important species. Generally, species ?f marine microorganisms are ubiquitous In the world's oceans, but some pathogens can survive only short separations from their hosts and consequently have not been transported globally. Closely related species .nay be particularly susceptible to each other's diseases. The fact that 231 The Honorable Frank Press September 28, 1977 Page 8 best known examples of the rapid spread of diseases through non-lnmune populations are from humans (e.g., measles, small pox, influenza) and terrestrial organisms (e.g., potato blight, Dutch elm disease, chestnut blight, myxomitosis in rabbits), may merely reflect the relative lack of knowledge about marine pathogens. It is known that a pathogen eliminated roost of the eel grass in the North Atlantic in the 1930s and that Pacific populations were untouched. Migration of disease organisms could possibly affect the shrijop, fin fish, and fish meal industries In both oceans. Construction of a new canal could be expected to produce significant local effects. Spoil from construction of the existing canal eliminated mangrove forests, sea grass beds and coral reefs on both sides of the canal. Excavation for a sea level canal would be much more extensive and local destruction could be expected to equal or exceed that observed after construction of the Panama Canal. Currents and water transport through a sea level canal may be expected to increase significantly the sediment load of receiving waters. The transport of these sediments by ocean currents would harm mangrove shores, sea grass beds and coral reefs for undetermined distances along the coasts. The local consequences of a sea level canal for nutrient dynamics and lower food chain processes were addressed in the Study Commission report. That discussion is essentially accurate, but recent advances in comparative ecosystem analysis and the use of models now permit more specific predictions. Discharge of nutrient-rich Pacific Ocean water into the nutrient-poor Caribbean would result in significant local pertur- bation. The biological consequence would be the creation of a plume of enhanced plankton production off the Caribbean end of Che canal. Such an area would not be large enough to augment fisheries yield significantly. The plume would probably provide a favorable environment for planktonic organisms carried through the canal. It may be possible to predict the size, persistence and magnitude of the plume using available models. III. A barrier system is necessary to limit the movement of organisms through a new sea level canal or through the existing canal if the lockage water is made more saline . The Study Commission concluded that barriers to migration in a sea level canal were both necessary and feasible, but did not present support- ing information on the feasibility and efficacy of specific types of barrier. Both th Battelle and NAS investigations concluded that none of the barrier ccx.c^pts that had been proposed could be expected to pre- vent migration altogether. The Coimittee is not aware of significant advances i t knowledge since 1970 concerning the design of biological 232 The Honorable Frank Press September 28, 1977 Page 9 barriers for an Interoceanic canal. A barrier feasibility study is essential to a valid assessment of the environmental Impact of a sea level canal or of proposed modifications of the present canal. There are many unanswered empirical questions that are fundamental to the design of artificial barriers. Most attention has been devoted to hyperthermal and hyposalinity barriers. However, the thermal and salinity tolerances for many of the several thousand species that may be candidates for migration are unknown; even le&s is understood about these species' potential to become acclimated to new conditions, or about the tolerances of non-adult forms. The practicality of maintaining thermal or fresh water barriers large enough to prevent migration is unconfirmed. Several novel barrier techniques (e.g., toxicants, bubble curtains, deoxygenation, ultrasonics) and artificial means of triggering avoidance responses in motile organisms have been mentioned, but neither their efficacy nor engineering feasibility for an undertaking of this size has been investigated. It is commonly assumed that tidal gates would be required for most of the proposed canal routes to maintain currents that are safe for navi- gation. Such gates could be manipulated to fully control flow rates. The Committee observed that the ideal case from an ecological standpoint would be the attainment of zero net flow, a possibility raised in the Study Commission report. Although zero water transfer may prove impracti- cal, keeping interoceanic transfer to a minimum would significantly reduce passive transport of organisms and would also enhance the practicability of hyposalinity, thermal, chemical, and/or other artificial barriers to migration. Most observers believe th^t traffic considerations dictate a tradeoff between flow restriction and the economic operation of a sea level canal, but these economic considerations have not been sufficiently examined to permit informed judgment concerning the practicality of zero- flow or low-flow canal operation. Experience with the Panama Canal demonstrates the desirability of a fresh water barrier to Interoceanic migration. The present canal con- stitutes an effective barrier to movement of the vast majority of Atlantic and Pacific species, partly because fresh water fills most of the canal route and partly because the seaward flow of lockage water from Gatun Lake inhibits passive transport. The paucity of biological surveys of the two coasts of Panama ,precludet> a definitive evaluation of the canal as a fresh water barrier, but recent findings are encouraging. Collections from the lock chambers and lakes of the canal system contained a total of 165 species; of these, 57 were from the . lic Institution Marine Microorganisms and Pathogens Dr. J.C. Zieman University of Vir^ Sea Grass and Manj^ Communities 32-461 O - 78 - 16 236 COMMITTEE ON ECOLOGICAL EFFECTS OF A SEA LEVEL CANAL Written Submissions Walter H. Adey Smithsonian Institution Charles Birkeland University of Guam Janes E. Bbhlke The Academy of Natural Sciences, Philadelphia David G. Cargo University of Maryland Janes A. Duke United States Department of Agriculture Kris t Ian Fauchald University of Southern California Barry Fell National Decipherment Center Stephen R. Glbbs University of Washington J. Frederick Grassle Woods Hole Oceanographic Institution Michael J. Greenberg Florida State University Donald R.F. Harleman Massachusetts Institute of Technology Holger W. Jannasch Woods Hole Oceanographic Institution John E. McCosker Stelnhart Aquarium Richard N. Mariscal . / • Florida State University John H. Martin Moss Landing Marine Laboratories T.R. Parsons International Association of Biological Oceanography James W. Porter University of Michigan C. Ladd Prosser University of Illinois William H. Quinn Oregon State University Michael R. Reeve University of Miami Allyn H. Seymour University of Washington Gilbert L. Voss University of Miami Thomas M. Zaret University of Washington 237 EXECUTIVE OFFICE OF THE PRESIDENT OFFlCe OP MANAGEMENT AND BUDGET WASHINGTON. DC. tOI»l October 6, 1977 INT « .^..^ ACTZON MEMORANDUM FOR THE PRESIDBNT FROM: Jim HoZntyzc SUBJECT: 6«a-l«v«l ranain* Canal Study ISSUS Should th« Administration lupport laglalatton to aothoriat • gastwdy by the Con»a of tnqlnaara of tha faaaibillty "of '• tevel canal by Corps of Engineers. • Do not support legislation to authorize study. 240 Article XII A Ska-Level Canal or a Third Lane of Locks 1. The United States of America and the Republic of Tanama recognize that a sea-level canal may lie important for international navigation in the future. Consequently, during the duration of this Treaty, both Parties commit them- selves to study jointly the feasibility of a sea-level canal in the Republic of Panama, and in the event they determine that sucli a waterway is necessary, they shall negotiate terms, agreeable to both Parties, for its construction. 2. The T'nited States of America and the Republic of Panama agree on the following : (a) No new interoceanic canal shall be constructed in the territory of the Republic of Panama during the duration of this Treaty, except in accordance with the provisions of this Treaty, or as the two Parties may otherwise agree; and (b) During the duration of this Treaty, the United States of America shall not negotiate with third States for the right to construt an interoceanic canal or any other route in the Western Hemisphere, except as the two Parties may otherwise agi'ee. 3. The Repul)lic of Panama grants to the United States of America the right to add a third lane of locks to tlie existing Panama Canal. This "right may be exercised at any time during the duration of this Treaty, provided that the United States of America has delivered to the Republic of Panama copies of the plans for such construction. 4. In the event the United States of America exercises the right granted in paragraph 3 above, it may use for that purpose, in addition to the areas other- wise made availalile to the United States of America pursuant to this Treaty, such other areas as the two Parties may agree upon. The terms and conditions applicable to Canal operating areas made availa))le by the Republic of Panama for the use of the United States of America pursuant to Article III of this Treaty shall apply in a similar manner to such additional areas. 5. In tlie construction of the aforesaid works, the United States of America shall not use nuclear excavation techniques without the previous consent of the Republic of Panama. Mr. Metcalfe. Second, the Chair feels that there are two major obstacles to a sea-level canal bein^ constructed. And I do not mean to over-simplify the problem, for the purposes of these hearings. One is the relationship of Panama and the United States, in terms of acceptance of a sea-level canal. But of equal importance are the ecological findings that could come forth as a result of these studies, as you have so very well explained in detail in your summary presentation. I believe it was in the year 1973 that we visited tlie Smithsonian Institution office in Panama. And at that particular time, there was a presentation on the major problem of the marine life, as it would be affected by a sea-level canal, more particularly, of the marine life moving from the Pacific into the Atlantic. And with respect to that study, of course, we have not come up with a positive finding, as you so very well explained in your statement. Doctor, how long would it take, and how much money would it require, for scientists to determine, with some certainty, the ecologi- cal effects of a sea-level canal ? Dr. CiiALLixon. This is a little hard to predict, Mr. Chairman. I would anticipate that we are talking about at least a decade. We anticipate tliat about $1.5 million would be necessary to buy ship time alone for the .scientists to do this kind of sampling. And per- haps at least that much again to pay the salaries and travel expenses of the scientists who would have to carry it out. 241 So perhaps $3 million would be a very conservative estimate. Mr. Metcalfe. Are they in the process now of working toward that study, or is it going to be necessary for us to implement it by having a budget set aside for that particular study ? Dr. CiiALLixoR. I believe, Mr. Chairman, that a budget would have to b? set aside. The work that is now currently underway is on a very piecemeal basis, and we would be talking about 20 to 25 years, at the rate that it is going on. Mr. ]\Ietcalfe. Doctor, would you elaborate on how the possible damage to the environment, which might be done by a sea-level canal, would impact upon the economic interests of the United States. j Dr. Challixor. Only indirectly, Mr. Chairman. We do know that jthe T'nited States imports a great deal of shrimp, for example, most lof which is harvested in the Bay of Panama, which is one of the imore productive areas of the oceans of the whole world, and should there be an interchange of organisms between the two oceans, that could indeed be threatened. There are other organisms that could come from the Pacific into the Atlantic that could directly affect some of the valuable commer- cial fisheries. Those are the sort of things that would require a great deal more study than we do now. But I would say the primary economic effect would be the com- mercial fishing that we now carry out in the Atlantic and the Pacific. ]\Ir. Metcalfe. Dr. Jones, would you be kind enough to address youi-self to that question, as to the problem that we are having with the migration of marine life, in making a determination as to its effect, and what damage may be done through the change in the marine life of the two oceans. Dr. Jones. Actually, this is the crux of the whole thing, I cannot give you a good answer. It is primarily because we do not know the flora and fauna fairly. There have been speculations in the past, that went to recent headlines most elegantly, in which there was speculation that the sea snake, the yellow-bellied sea snake, could and would transit the sea-level canal and create all sorts of havoc on tropic beaches. There have been some speculations that it might travel with the Gulf Stream, all the way to the British Isles. Well, this is possible. I do not think sufficient research has been done, really, to state that unequivocably. Another source of discontent, if you would have it, to the tourist industry in the East Indies, is the fact that some years ago there was an outbreak or upgrowth of populations of the so-called Crown of Thorns Starfish in the mid-Pacific. There is a related species of this same Crown of Thorns Starfish that ranges from the Gulf of California down along the central American coast in the Pacific. As a matter of fact, there has been one unsubstantiated sighting— unsubstantiated in that the specimen was not collected. There has been a sighting of the Crown of Thorns Starfish close to the mouth of the present canal, some place in Tobagian or Tobac- co Island, out in the Bay of Panama. 242 If that were to go through, it miglit create havoc in the state park, the protected areas in the Virgin Islands, where the coral reefs are to wliich tourists travel, and to the reefs around Jamaica. Any coral reef oriented tourist spot would be, could be the victim of the Crown of Thorns Starfish. But we do not really know what predators there might be in the Atlantic tluit would take care of the Crown of Thorns Starfish. "We do not know whether the Crown of Thorns Starfish could indeed travel that far north. So we come back once again, and again, to the fact that we do not know about the fauna. We do not know about their physiological tolerances. We do not know enough about what kind of environ- ments are available in the place to which they might immigrate, whether it is the Atlantic or Pacific, in the case of an Atlantic species. We just do not know enough. Mr. ^Metcalfe. Dr. Jones, the answer that you gave to my ques- tion, does it relate to the statement that Dr. Challinor mentioned a moment ago, that we will need a study that will require at least a decade, and therefore would need a specific budget ? Would that suffice for us to get the necessary scientific information? Would that be included in that study ? Dr. JoxEs. Certainly. As you will see from the detailed statement, everything proceeds stepwise. First, we have to know what is there, on both sides. We have to know the physical and chemical parameters of where these individual species live. We have to know what their tolerances are, how much of an ele- vation of temperature they can stand, how much oxygen do they need, what kind of food do they require, how long do their larvae live, are larvae carried in water currents, or are they brooded on the adults. What kind of ]n*edators do they have? How are they interreacted with other animals in their community? How similar are they to species which are superficially similar on both sides? What will their reproductive interaction be? What particular behavior patterns arc there tliat separate them from one another? And something else miglit come in and interdict. All of these things will flow along from this basic survey. And I think the money that Dr. Challinor has mentioned will include this experimental work, observational work, as well. Mr. ^Metcalfe. Thank you. Dr. Challinor. Do you think that the construction of a sea-level canal must await the findings of projected environmental effects? Dr. CiiAELixoK. As a citizen. ]Mr. Chairman. I would certainly feel better if we had a good prediction before such a canal was con- structed, Mr. INIetcalfe. What are the advantages and disadvantages of the requirement for the formal environmental impact statement, as specified in the Gravel auieiulment. and the ]Murphy bills? Would a regular report be just as sufficient ? 243 Dr. CiiALLixoR. I do not believe so, personally, Mr. Chairman. I think that a formal environmental impact statement should be re- quired. Mr. Metcalfe. Thank you. I have no further questions. Mr. Moduli in? Mr. MoDOLix. Thank you, Mv, Chairman. Just a couple of ques- tions to follow up on the chairman's. Can you cite any jiarticular examples of adverse economic conse- quences that have followed from the appearance, in any particular marine area, of a new species, or new life, consequences detrimental to our fisheries or otherwise ? Dr. CiiALLixoR. Amono; the most recent examples we have is the miofration of fish from the Indian Ocean-Red Sea area into the Mediterranean. I recall that of the 10 most valuable commercial fish species caufi^ht in the eastern ]Mediterranean today probably more than half are relatively recent immio;rants. Now, whether these fish are more valu- able or less valuable, they did require a change in technique for catchin<>; them, and ao^ain, a new kind of marketinp; technique. ISIaybe, Meredith, you have some specific examples. Dr. Jones. Well, it is difficult to draw a comparison. The two obvious comparisons — and the ones that are usually cited — are what has happened subsequent to the openino^ of the Suez Canal, and what has happened to the Great Lakes, relative to the opening of the Welland Canal. And I think you may be aware of the devasta- tion that the lamprey have caused in the Great Lakes to the fisheries there. It is also well to point out that the effect of the lamprey did not come until much later, after the Welland Canal Avas opened, some 80 or 90 years before the fishery started declinino^ there. That was also compounded by the fact that perhaps that partic- ular fishery was overfished and made relatively weak. Then the lamprey came in and just sort of finished it off. There are a number of other examples of the Suez migrations, but actually they arc not really comparable, because you have a truly depoverate fauna, a few species in the Mediterranean, and a rich diversity of species in the Red Sea. It is a harsh life in the eastern Mediterranean, and this has re- sulted in the depoverasation of fauna. It is, I think, acceptable that the Red Sea fauna would move throujjh the Suez Canal as soon as the Bitter Lakes had become leached out. The Bitter Lakes were salt deposits that acted as a natural bar- rier, such as Gatun Lake acts as a freshwater barrier in this case. In recent years, the Bitter Lakes has leached out, and the salinity barrier, and the net flow of species is into the Mediterranean, a low diversity area. Mr. MoDGLiN. One other question: You indicated very clearly in your testimony, a need for a len^jthy study of the possible ecolo^rical effects of a sea-level canal. The pieces of leofislation before the subcommittee take different approaches, as to timino- of the environmental studies on a sea-level canal. The first Murphy bill and Gravel amendment caused the en- 244 vironmental studies to begin immediately. And the most recent Murphy bill would delay those studies until such time as other aspects of the sea-level question had been updated, data had been updated. Do you have a view as to — in view of the time sequence, or the time that would be necessary for an adequate study — which of these approaches is better ? Dr. Jones. As Dr. Challinor has mentioned, it is going to take quite a bit of time, at least 5 vears to ixet to the point where the fauna is known. Helter-skelter experiments could be done previously, in terms of physiology and beliavior. But you would not necessarly know what you are dealing with, or perhaps more to the point, what you should be dealing with, until the whole fauna were known. So it seems to me that your first priority will have to be in start- ing these surveys, because there is such a long lagtime between tak- ing the samples, sifting them, sorting them, getting them to the various specialists who will make the proper identifications, and then at the same time the physical and chemical data that is col- lected can be processed. Everything could come in, perhaps, at the end of the 4 or 5 years, and you would be in a position to say : '*Ah, this species requires this habitat. Xow, how does that compare with these species which requires that habitat?"' The comparison would start some 5 years after the initial collect- ing program. It occurred to me in terms of the recent situation that has devel- oped down in Tennessee, if an initial biological survey had been carried out. the snail darter may have been recognized as an en- dangered species, and the whole thing might have been stopped right there, rather than investing how many millions of dollars in the dam ? There you have the same sort of thing. If we find something stands a very good chance of going through a sea-level canal, and endanger- ing the $54 million fishery industry of Panama we can consider if we should stop it now, or should we wait until the thing is halfway or three quarters dug, and then start juggling priorities? You might consider that. ^Ir. MoDGLTX. Some might have concern on the other side of the question, that the money spent for environmental studies might not be fully justified if the check of the economic and national security data show that the sea-level canal is clearly not merited in the near future. Would there be a value to the studies that you are suggest- ing, irrespective of the sea-level canal construction question, or are they — is the money spent justified only in relationship to the ques- tion of construction of the sea-level canal ? Dr. Jones. In his statement, Dr. Challinor spoke to that very thing. It would be. One of the longtime questions of science is "What is a species?" You can look at a cow and horse and say they are different species, but when you look at an antelope and gazelle, it is a little more difficult to say what different species are. But still, there are differences. There are other cases where things get down to such a fine point that you have to go to the biochemistry of the animal to decide what is the species. 245 Well, here we have a readymade workshop for determining what is a species, in that, at one point there was a continuous fauna from the Atlantic to the Pacific. It has been shut off now for 8 to 5 million years. In the meantime, these two separated populations have gone on their separate evolutionary pathways, evolving into different species, or not evolving- into different species. But you have the same species. Here is an opportunity to study what is a species. How do differ- ent kinds of animals and plants arise in nature? This will be one thing, as Dr. Challinor ])ointed out. This is a survey-type thing, precisely the kind of work that is being carried out in the Pasca- goula fishery lab by the Government over the past 20 to 25 years, looking for new fishery grounds, whether it's shrimp or fish, or fishmeal-type fish. Mr. MoDGLi?^. Is it possible to talk about the study of marine bar- riers between the oceans, in connection with the sea-level canal, with- out the complete base line survey that was discussed? Could not pos- sibly, in the interest of conserving money and time, more attention be given to the question of marine barrier, without the complete sur- vey? Or is the complete survey a prerequisite? Dr. Challinor. I think they are both interrelated. You could, however, go ahead and start working on trying to figure out a marine barrier. At the present, we do not have the technology to make 100 percent effective marine barriers, and we should start working on just how effective the marine barrier could be. I think one component that would be necessary for that is what it should be a barrier for. And in this case, the survey would be an important component in order to know what you are going to try to stop going between the two oceans. So I think they are interrelated. But I think work could initially being right away on certain things that we know that would very likely start moving through. Mr. MoDGLiN. Thank you, Mr. Chairman. Mr. Metcalfe. Mr. Nonnenmacher, do you have any questions? Mr. Nonnenmacher. Thank you, Mr. Chairman. Dr. Challinor, you and Dr. Jones have made it clear that such a survey would certainly be very worthwhile as an end in itself, re- gardless of the issue of a sea-level canal. Have you, or any organization you know of, ever sought funds such as $3 million to conduct a survey in this area? Dr. Challinor. The University of Miami, I understand, attempted to do this back in the sixties. AVe have proposed relatively modest requests through the Office of Management and Budget for these kinds of surveys. We have not been very successful. INIr. Nonnenmacher, You have not sought it directly through a committee of Congress ? Dr. Challinor. Not through a committee of Congress, no, sir. Mr. Nonnenmacher. I am a little bit regretful that we cannot take the time to go over your more complete statement. I want to commend you for the depth to which you laid out the specifics of the survey. I think that shows a real comprehension of the scope that it requires, and the specific methods you would follow. 246 I think that is very jjood for the committee to have, to show how you reach the sum of money that you project. I would like to ask you a question about the quotation on paj^e 1 of your more detailed statement, from B. W. Evermann and E. L, Goldsborouo;h, in 1909, and their scientific paper, "Notes on Some Fishes From the Canal Zone." The quote reads: It is a source of great regret to biologists that the Government has not ap- preciated the necessity for a thorough biological survey of the Canal Zone before the completion of the canal. It is not yet too late to make such a survey, but it must be made before the canal is completed ; else problems which can now be solved will then remain forever unsolved. It sounds sort of what you folks are saying. But was that recom- mended in connection with a sea-level canal, or a locks canal, or was it recommended in Mr. JoxES. At that point, I do not think they decided. It was really just in relation to a canal. Mr. NoNXENMACHER. Did it concern only fish, or did it also con- cern fauna in the land areas of the territory itself? Dr. JoxES. It was freshwater and terrestrial studies, because ap- parently the rivers and streams there do harbor their own specific fauna. And here was — on the one hand, with Gatun Lake filling up, a valley which would have a fairly large area of forest and streams wiped out. On the other hand, with a sea-level canal, they could not anticipate what the effects would be, either way. They were calling, in their layman's capacity, for a study. I do not laiow if there was any formal call for a study. Mr. NoxxENMACHER. I Only have one other question. Could you give us an idea of the types of marine barriers that might be erected? What would they consist of? How would they work? Would they interfere with ships passing? Obviously, they could not. Dr. Jox'ES. The ones that are usually invoked are thermal barriers. Someone could postulate a series of nuclear reactors, whose heated effluent would create an area of hot water, through which larvae and animals could not pass. The only difficulty with this is that if you have a channel 700 feet wide, 80 feet deep, and moving at something like 6 knots there is a tremendous amount of water. And I do not think you could line up enough nuclear reactors to heat it up. I do not know, but it would be something for the engineers to worry about. Mr. NoNNENMACHER. That almost suggests the reverse of the en- vironmentalists' efforts to stop industrial thermal pollution — it sug- gests that we line the banks with industry down there, to keep the water hot. Dr. Jox'^ES. That is another possibility. Someone suggested having sewage outfall for the whole of the Panama Co. in this area which would create a barrier. There are also electrical screens, bubble screens, and chemicals of one sort or another. But again, if you do have Mr. Noxx'ENMACHER. Go ahead. I would like you to expand on the electrical 247 Dr. Jones. I do not know that much about it. I would imag:ine it would be some series of wires which would create an electrical field which would turn back animals. But again, you have this slush of water, a tremendous amount of water. At one point it was calculated that a cork that was not affected by the wind, would go more than a third across the isthmus one on rising of the tide cycle, would come back about a third of that way; would proceed to almost two-thirds across the isthmus, and come back, and then the third tide cycle, it would be through. Mr. NoNNENMACiiER. That is in what period? Eighteen hours? Within 3 days? In answer to a question posed by Congressman Snyder, regarding the nature of a pulsing tide through the canal, through a sea-level canal, Senator Mike Gravel last week told us that the tides would never meet — would not cross the Isthmus. That does not quite sound like you agree with the Senator, in view of what you have just said, and in view of Dr. Challinor's reaction. Would you care to comment on that? Dr. Challixor. In the report of the Canal Commission, I believe there was considerable evidence given that the mean level of the Pacific is slightly higher than the mean level of the Atlantic. And we do know that in the Pacific, at the canal entrance on the Pacific side, the high tide range, or the range between high and low water, is 18 to 20 feet. On the Atlantic, there is virtually no tide at all, 1 or 2 feet. At the Atlantic side, the water level is more controlled by the direction that the wind is blowing. This means that at high tide on the Pacific side, you would have 9 to 10 feet above mean level, a slug of water, that would be pouring through the canal. Then, of course, as low water appeared on the Pacirc side, the water would start to flow back out of the Pacific side. But never return completely, because your mean level seems to be slightly higher than the Atlantic. So what you would have is a slug of water, as Dr. Jones explained, shooting through the canal at high tide, going back to the Pacific at low tide, but never quite getting there. And then at the next high tide, shooting almost through. And on the third high tide, going all the way through. That was the example of the cork. Mr. NoNNENMACHER. Let me interrupt, please. By the third high tide, are you talking about a tide several hours later, or a third surge of the same tide ? Dr. Jones. No. No, this would be a matter of 8 — 36 hours. Dr. Challinor. Yes. Mr. NoNNENMAciiER. But you are saying Dr. Jones. There is a high tide every 12 hours. Mr. NoNNENMACiiER. So, of course, in 36 hours, contrary to what the Senator said, a tide would go the entire length ? Dr. Challinor. A particle of water should transmit the entire canal, from the Pacific to the Atlantic, or a slug of water — whatever you want to call it — in 36 hours. Dr. Jones. Incidentally, I uncovered another area that needs in- vestigation. In searching for background information, I contacted an ocean- ographer at Florida State, and he said that he disagrees with the findings of the hydrologists reported in the Commission reports. 248 And he thinks there is a greater head than is reported in the Com- mission report. Mr, NoNNENMACiiER. Greater what ? Dr. JoxES. Greater head of water in the Pacific, relative to the Atlantic. So there is basic work to be done noAV, as well as in biology. Dr. Challixoe. Inciclentall3% we are developing a satellite that will be able to measure more precisely mean water level. It will actually send down radar signals from the satellite to the surface of the ocean. And if this is done enough times, we should be able to get very accurate measurements, on the actual mean difference in levels of the two oceans. Mr. NoNNENMACiiER. That is all I have, and I want to thank you both for your very excellent testimony. If possible, if you could submit some data on these barriers, I think it would be valuable for the subcommittee to have it. Dr. Jones. I do not think we can do more than enumerate them. There has not been that much research on them. This wa^ one of the comments, as you will see in the Academy's report of 1977. No further research on barriers. Mr. NoNXEXMACHER. Is it possible that a barrier has not yet been developed that could even work? Dr. CiiALLixoR. Yes. Dr. JoxEs. Yes. Mr. NoxxEXMACHER. Tliaulv you very much. [The following was received for the record :] Responses to Mr. Nonnenmacher's Questions by David Challinor Question. Would you please expand on your answer to my question during the hearing by submitting any technical data you have, or may be able to ob- tain, regarding the pulsing of Pacific tides through the projected sea level canal. Answer. The best account of the effect of "pulsing tides through the projected sea level canal" is given by D.R.F. Harleman in his 1972 article entitled "Ex- change of Water Through the Proposed Sea-Level Canal at Panama" (enclo- sure 1). His statement concerning interocean water exchange is on pp. 45-6 and his figures 3 and 4 demonstrate the "pulsed" flow toward the Atlantic. Other comments concerning the hydrography of the projected canal may be found in the Canal Study Commission Reports (enclosures 2 and 3). Question. Colonel Sheffey testified to the effect that over the years that the Canal has been open probably hundred of millions of tons of Atlantic and Pacific Ocean waters have been interclianged by the taking on and discharging of water ballast by empty ships entering and leaving the Canal in either direc- tion and that, therefore, many forms of marine life have been transported from one ocean to the other. Please give me your comments as to the amount of environmental impact this interchange has already brought about. Answer. Colonel Slieffey has made the tacit assumption that small floating organisms can survive a canal transit in the rather inliospitable environment offered by ballast tanks. The idea of ballast water transport was advanced by R.H. Chesher in 196S (enclosure 4) as a possil)ility. Chesher had advanced this theory without direct ob.servations on the survival of organisms in this situa- tion and to this date no direct observations have occurred. It is, of course, possible tliat organisms can survive in ballast water or by the same measure they could not. The problem could l)e settled with some simple observations which would require the cooperation of the Canal company and a number of ship captains. While tlie Company would likely accede to this request, it is less probable for s^hip captains who would be required to slow or stop their vessels while sampling was in progress. Of course, such studies would be a part of our suggested biological/hydrographic surveys and subsequent physiological experi- mentation. 249 Bullstin of the Biological Sociaty of Washington No. 2 THE PAN AM I C BIOTA: SOME OBSERVATIONS PRIOR TO A SEA-LEVEL CANAL A Symposium Sponsored by The Biological Society of Washington The Conservation Foundation The National jV'Iuseum oc Natural History The Smithsonian Institution Meredith L. Jones, Editor September 28, 1972 250 EXCHANGE OF WATER THROUGH THE PROPOSED SEA-LEVEL CANAL AT PANAMA By Donald R. F. Hahleman Department of Civil Engineering Massachusetts Institute of Technology Cam bridge, Mossach usetts 1. Introduction The objective of tlie study was to determine the magnitudes and directions of tidal currents, for several proposed routes and canal cross-sections, of a sea-level canal across the Isthmus of Panama. The magnitudes and directio)is of the tidal cur- rents determine the net exchange of water between the two oceans. In addition, the tidal currents are of interest in assess- ing potential navigational problems for ships transiting the canal. The tidal currents are influenced by the following factors : i. The canal route, which determines the total length of the canal, ii. The canal geometry, primarily the depth and cross- sectional area, iii. The characteristics of the ocean tides at either end of the canal, iv. The roughness of the boundaries of the canal cross- section. V. The fresh water inflow into the canal. During the course of investigations carried out intermittently between January 1967 and May 1970, tidal computations were made for a total of 88 cases representing variations in the par;)inctcM"s listed a!)Ove. The derailed results are a\ai]able (Harleman, 1967; 1968; 1969; and 1970). A brief summary of Biu.u. BroL. Soe. Wash., No. 2, 1972 (41) 251 42 Bulletin vf the Bi()Io<^ical Society of WasJiin^ton the niaihematical model and results for a few typical c:ases are . (July). 256 Water ExcJiangc in the Sea-LcveJ Canal 47 19G9. Niirneiical coiiipiitatioris of tidal currents in the pro- posed sea-level canal. Addendum II. Ibid., 28 pp. (April). 1970. Numerical computations of tidal currents in the pro- posed sea-level canal. Addendum III. IhiiL, 10 pp. (May). AND C. II. l,KE. 1969. The computation of tides and currents in estuaries and canals. Technical Bulletin No. 16, Tidal Hydraulics Committee, Corps of Engineers, Waterways E.\- periment Station, Vicksbiirg, Mississippi, 14.3 pp. 257 INTEROCEANIC CANAL STUDIES ANNEX V — STUDY OF ENGINEERING FEASIBILITY APPENDIX 5 TIDAL HYDRAULICS Prepared by U. S. ARMY CORPS OF ENGINEERS JACKSONVILLE DISTRICT December 1970 258 6 Net tidal flow. a. General. Analyses indicate that a sea level canal in Panama would discharge water from the Pacific Ocean into the Atlantic Ocean during the high phase of the Pacific tidal cycle, and, to a lesser degree, from the Atlantic into the Pacific during the low Pacific tidal phase. A net mass transport of water to the Atlantic would result. The volume would vary with magnitude of the tidal ranges and canal characteristics, b. Volume of flow. The mathematical model has been used to estimate volume of flow that could be expected to transfer from the Pacific Ocean to the Atlantic Ocean, This volume could vary from less than 10.000 acre-feet per tidal cycle for a relatively small conventional canal to over 600.000 acre-feet per tidal cycle for a nuclear canal, c. Typical results. Figure C-8 shows variation of tidal discharge over one tidal cycle at a point 2 Vi miles inland from the Atlantic end of a 600 by 60-foot sea-level canal, with a Manning's "n" of 0,025. and with an extreme tidal range of 21,1 feet. The instantaneous discharge into the Atlantic Ocean under those conditions would reach a maximum of about 342,000 c.f s.. while the somewhat lower discharge toward the Pacific Ocean would reach a maximum of about 246,000 cfs. Analysis indicates that during the extreme tidal cycle there would be a net discharge of about 50,000 acre-feet into the Atlantic. Over a range of Manning's "n" values from 0,020 to 0,040, the net discharge per tidal cycle would vary from about 55,000 to 30.000 acre-feet. The range of Pacific tide would also cause variations in the net discharge from 39.000 to 50,000 acte-feet per tidal cycle for the mean range (12,7 feet) to extreme range (21.1 feet) Pacific tide, respectively. C-14 259 F. FINDINGS 1 Tidal currents. A sea-level canal across the American Isthmus would experience tidal currents which vary with route location and configuration The Pacific tide would be the dominating force generating tidal currents at any rouie. Its magnitude varies along the isthmian coast, with the mean range varying from 6-14 feet and the maximum range from 10-23 feet in the area of study. Maximum currents would vary from about 3 to 7 knots with extreme tidal conditions. Currents would be affected by canal configurations, with maximums occurring at restricted sections. In general, tidal currents increase with channel cross section and tidal range, but decrease with canal length and channel roughness. Tidal currents can be reduced by providing tidal basins and tidal checks, or by increasing canal length and boundary roughness. The need for such special measures is considered individually for each route. 2. Fresh-water inflow. All sea-level canal routes considered would intercept the fresh-water discharge of existing streams to a varying degree. Diversion of these streams would be desirable from the navigation standpoint. However, total diversion would be too costly Effect of crosscurrents at points of inflow can be minimizad by inflow structures. Analysis of fresh-water and salt-water volumes indicates that, for the most critical route location, density currents could probably occur for several consecutive days about once a year. The fresh water would flow along the canal, thus lessening the hazard to navigation It is anticipated that in the design phase of a sea-level canal project, physical models would be constructed for detailed studies of density current action. 3. Net exchange of flow. The difference in sea-level elevations between Atlantic and Pacific Oceans would result in a net transport of water to the Atlantic Ocjan. The volume would range from about 10,000 acre-feet per tidal cycle for a relatively small tidal range and conventional canal to over 600,000 acre-feet per tidal cycle for an extreme tidal range and a nuclear canal. F-1 260 ANNEX V STUDY OF ENGINEERING FEASIBILITY INTEROCEANIC CANAL STUDIES - 1970 261 .^ freshvvyter ecosystems, marine and estuarine phvsicochemical and ecological studies were cariied out at a number of stations along the Pacific and Caribbean coastlines. These field investigations included chemical analyses of\vater and organisms, and diffusion studies at various offshore locations to estimate po^tial movements of radionuclides. Biotic interchange: An unobstnicted sea-level canal across Central America would allow relatively easy passage of marine/organisms. Certain forms of marine life now pass through the Paniima Canal even thou^i Gatun Lake provides a highly effective biotic barrier. Barnacles and other inimobjre organisms are carried through on the hulls of ships, and some small plants and animals 'survive in ballast water carried from one ocean to the other. Linking the oceans with an unobstructed salt water channel would greatly facilitate the movement of these and other organisms. The net flow of water from Pacific to Atlantic would depend upon the size, length, location, and configuration of the canal. This flow would average as much as 100,000 cubic feet per second in a relatively short unrestricted canal (Route 17); on the other hand, a freely Hoating object would take as long as ten days to move from the Pacific to the Atlantic through a 100-mile unrestricted canal on Route 25. The use of tidal check gates would reduce flows_ greatlv. Pro per timinp nf gate movements could reduce the net flow to zero, althouglx;t1iere would be some mixing^ lirough the open gates, similar to the mixing and flushing action m any tidal estuary. Pacific v^ater, though slightly cooler than that of the Caribbean, has about the same salinity. Periodic tidal flow in a salt-water connection would aid the movement of free-swimming species and the passive transport of small organisms from one ocean to the other. A canal would also provide transitional habitats where organisms could be harbored pending their adaptation and dispersal. Conversely, the planned use of tidal gates and the sedimentation, turbulence, and freshwater inflow of a sea-level canal would serve to restrict the extent of any migrations. Taxonomic studies indicate that the Atlantic and Pacific ocean species along the Isthmus are closely related, even though few are identical. This similarity results from the linking of the Atlantic and Pacific Oceans until recent geologic time, perhaps 3 miUion years ago. When such closely related species are allowed to intermingle, several results may occur. Concern has been expressed about three potentially undesirable biologic consequences of such intermingling through a sea-level canal: — Some invading organisms might be so highly successful in their new environment that they could disrupt the previous ecological balance and become pests. — Successful migrants through the canal could carry parasitic organisms for which defense mechanisms do not exist in the new environment. Although such a possibility cannot be dismissed entirely, experience in other similar areas leads to the belief that it is unlikely to be a significant threat. In past geologic eras, marine fauna of the isthmian region were free to interact. Their subsequent separation by the isthmus, while permitting and creating different ecosystems in the two oceans, probably has not signifiLantly affected the internal environment of the host fauna for the parasite. Thus, migrant parasites are expected to be less harmful than totally alien organisms. V-121 262 April igOs VOLUME 13 • NUMBER •i \l ^'i\ ^"■■^^^TV-ev fcy ^ L-ll^'4#--;^ \/ ■ Published Quarterly hy The American Society of Limnology and Oceanography, Inc. \ 263 TH.4NSPonT OF Makine Plankton Through the Panama Canal I lit' proposed construction of a sea-level '■A in Paitaniii has stimulated biological ■■":st ill the Paiiamic marine fauna and '■: Several investigations are being • : :ii-d for a comprehensive study of the 'p and afier effects of such a canal. 'Mtvjtiilijy (■v;.;ts . liowcvcr, that marine '''■>• and aninials have been traversing :>rMent canal since its opening. '•' 1956, the Panama Canal Company ■-'t.-led a required draft regulation for "UTsaiid iieig1:;-rs (Hodimon 1956). D\u: '!>t'ir large "'.sail area," improperly bal- ■ d .ships may become unmanageable on ■ly day.s in narrow parts of the canal ■•' till' locks, l.aige ships are thrielore required to maintain a minimum draft (Dertien 1966) while passing through the canal. Company representatives board ships waiting to pass through the canal, and if the ships do not have the required mini- mum draft, their officers are instructed to increase the salt-water ballast. To a\oid delay, ships iisiiig the canal frequently attain the correct draft before reaching the canal harbor. When the draft requirements were put into use ]2 years ago, near)) eviry empty sliip was reqin'red to take on water. Today, Mr. J. Jones, Ad- measiuer of the Panama Canal Company, estimates that about two ships a month are asked to take on additional ballast. 264 3SS NOTES AND COMMIiNT Oil tankers pump salt water into special bilge tanks, used exclusively for the pur- pose. Tlie opening to tlie intake pipe is located from 1 to 3 m below tlie surface of tlie water, and substantial amounts of water aie taken aboard. About 18 metric tons of salt water are required to lower a tanker 131 in long 1 cm. A tanker 202 m long requires 46 metric tons to lower it 1 cm. Thus, a conservative estimate of the amount of water transported from ocean to ocean can be derived. Assuming two small .ships ballast down a total of 2 m, 3,600 metric tons of water would be carried through the canal each month. 0\'er a one- year period, 43,200 metric tons of salt water would be carried through the canal not in- cluding any water transported by ships that had ballasted down before reaching the canal. The water is pumped through large im- peller pumps. This is, of course, fatal to large organisms but planktonic lanae and other microscopic organisms almost surely survive. A variety of invertebrates are known to pass through the pumps of salt- water aquarium systems as lar\ae to settle ill the holding tanks and aquaria. The greatest traffic in empty ships is from the Pacific to the Atlantic Ocean. ^Vater is taken into the ballast tanks in the Bay of Panama and dumped in Cristobal Harbor where many ships refuel. It requires about 6 hr to pass through the canal. Water is also carried from the Atlantic to the Pacific Ocean but, as the ships do not commonly refuel in Balboa, the bilges are either pumped at sea or in the next port. It is cvidenl, therefore, that lar^e (;i tities of salt v.ater hequently pa.,s tliri ■ the present Panama Canal. AUhi)ii.rli . transport is greater today than ev-r b.i ■ there is soni" pnssiliilit)' t'uir il- ha< „,., on since the canal opened in WU. M;ip, organisms of microscopic size mav K, been transported from ocean to oc(\ui r." times over the past 51 years, it is not v, ticiil to assume that populations ur m.i- organisms on different sides of the ist!.: are ipso facfo genetically separattvl 1', ;. finds of geminate species should bo examined and efforts made to ati-inii comparative s) steniatic and ecolciicai ■ veys of the Panamic area. It rnavh,- i .such surveys are 50 years too lati' tci .. scribe the uncontaminated condih.on. I am grateful to Mr. and Mrs. I.. Williams of the Panama Canal Cnn •, for their assistiuiee in gathering infnr;»\;; relevant to this study. These obvrv:.: ■• were made during a brief visi^ to • Panama Canal Zone that was supi; • ■ Miiseitm of Coinpumtivc 7jio!ii:i!i. Harvard UniccrsiUj, Cumhridge, Massavhtisetis OJ/jS. REKEREXCES Deiitikn, D. A. 1906. .\Iaiiiw Hir--. '. ^ V - . randum 0-66 — shipping. Vhii:u:i:i <■'■;■■'■' ' Ballwa Iti-ighls, C.Z. RooiMON, W. S. 19.50. Maiiiif.Uirfil..r- V it- randum No. S-.S?, rpvis'-d. I'.iin-. . ' -- C:o.. Balboa lleislUs. C.7. 265 Mr. Metcalfe. Thank you, Mr. Nonnenmacher. Now, we will hear from Mr. Tannenbaum. Mr. Tannenbaum. Thank you, Mr. Chairman. You indicate in your statement — in the deliberation that Dr. Jones made — that the proposed study would have some positive effects, quite independent of whether or not a sea-level canal is ever constructed. Could you elaborate further as to the practical, rather than the academic positive effects, for such a study? Dr. Challinor. These are risky to predict, as I pointed out in my summary statement. The more we understand the fish and animals that live in the ocean, the better we are often in a position to harvest them. In other words, if we know at what times of the year they live at different depths of the water — by studying their life cycles — then in turn we know at what time of year are the best times to catch them. In other words, the time they are not spawning. We could conceivably regulate our harvest of valuable commercial species in a much more orderly fashion; in some cases, we are doing so now. The Smithsonian, over the years, has studied, for example, the fish on the Atlantic coast. The Bureau of Commercial Fisheries, which is now the National Marine Fisheries Service, was actually spun off from the Smithsonian, back sometime around the turn of the century. The practical results that come from the kind of basic research that the scientists do, very often produce positive effects, but you cannot really predict them in advance. Mr. Tannenbaum. Well, you feel unequivocably that this would be a very practical thing to do ? Dr. Challinor. I think the cause would be very good, and practi- cal benefits would result. Mr. Tannenbaum. Were you present while some of the other wit- nesses were testifying this morning ? Dr. Challinor. Yes, sir. Mr. Tannenbaum. Are you aware they indicated that a 15-year lead time would be required, not just a lead time, but time to study and to construct a new sea-level canal ? In light of your comment that it would take a decade just to do your study, would you say that is unrealistic ? Dr. Challinor. Perhaps, in that our form of government has to result in compromises from different groups, all of whom have their own strong feelings about things. If indeed the canal would not be completed, should it start almost immediately, for another 15 years, I think at the end of 10 years, the biological studies — should something really disastrous turn up — could conceivably be grave enough to stop such a canal, despite the investment. These would be the sorts of decisions, I think, that we are now facing in one or two cases under the Endangered Species Act right now. Mr. Tannenbaum. One other question. The $3 million figure, read- ing your detailed statement, it would seem that you used the $3 million up in the first year, rather than over a 10-year period. Is my I 266 Dr. Jones. For the basic survey alone, just getting the ships out to a platform to collect the Siamples of plants and animals would be about $1.5 million. And that survey would be in the first year. Conceivably, after 3 or 4 years, it may be necessary to either dupli- cate this to make sure that the initial observations were indeed cor- rect, or at least to go back and reoccupy certain stations and re- sample to see that the evaluations are indeed proceeding according to what might have been predicted in the initial survey. Mr. Taxxexbaum. If I understand your mathematics, here, you are saying that in 119 days, the ship time alone would be $1.3 mil- lion, and you indicated that it would be an almost comparable amount for staff time and expenses. That adds up to $2.6 million in the first 119 days, without regard to some Dr. JoxES. Well, the $1.5 million, for ship time, would be the 119 days. But then the other would be for the year. Ship time is — it runs about $5,500 a day. Mr. Taxxexbaum. Your $3 million cost estimate is for the initial expenses. The overall study would be initially more ? Dr. CiiALLixoR. Yes. Dr. Joxes. If I may, one of the previous responses to a question from ]\rr. Modglin, had to do with the crucial depth in Gatun Lake, in terms of scarcity of water, and the necessity of augmenting Gatun Lake. I think the response was that they anticipated digging the chan- nel deeper. But it seems to me that the crucial depth here is not so much the channel depth, but the silt depth of the upper part of the upper Gatun chamber, on the Atlantic side, and the upper chamber of Pedro Miguel on the Pacific side. These are concrete and have been there since about 1910. Unless you chisel out a hole for a deep draft ship to go through, having a deep channel on the other side is not going to make any difference at all. So it seems to me they really have not responded to how they are going to meet this augmentation of water. In the Commission reports there are three alternatives given. One of these was indeed deepening of the channel. Another one was build- ing diams over on the west side of some of the rivers that come in from the west. And the third was seawater pumping. Now, if they decide on this, which is in the Commission reports, was the least costly of three alternatives. If they decide on that — as Dr. Challinor has pointed out in his opening statement — we have once again the problems associated with a sea-level canal. If there is a very good chance the seawater will mix, you just have an elevated ocean — ^interoceanic connection. The animals on the one side would go through to the other. Dr. CiiALLixoR. We want to stress, now, that fresh water is a pretty effective barrier to organisms pouring from one ocean to the other. There have been a few isolated cases, mostly barnacles, that have made the passage across, but certainly for most fish species, this is a very effective barrier. Dr. Joxes. The last page of the detailed statement has a diagram — I just happen to have a chart here — that reproduces this chart in black and white. 267 And as you can see here, with this being the Atlantic and the three sets of Gatun locks — Gatiin Lake in the center and Pedro Miguel locks on the Pacific side, the Miraflores Lake, and then the two ISIiraflores locks — the number of animals found associated with the lock chambers, tails off quite rapidly as you go. These animals do not extend over. It is only these up here that go into the lake. The ones in green are found transiting on both sides of the canal. But of the 19 species that are found in the locks chambers of the two sides, more than half of them are freshwater species. The others are animals which conceivably had been transported on the hulls of ships making rapid passage. Of the 160-some species here, only 19 are on both sides, and of those more than half are freshwater species. So Gatun Lake is an effective barrier to the vast majority of marine animals on the two sides. INIr. ]Metcalfe. INIr. Constant, would you care to elaborate on your statement ? Mr. Constant. Yes, sir. My reference to dredging merely referred to the creation of an additional water supply that would allow transit of more vessels, because each time a vessel goes out, it dumps a considerable amount of water. It does not refer to the draft of the vessel. The vessel going through the draft is still limited by the 39.6 feet. So it would not increase the draft of the vessels' sizes, going through at all. It merely creates more water than could be used to transit the vessel, as they lock through. Mr. INIetcalfe. I would like to express the opinion of the commit- tee, and the fine staff' that we have here. This is a very fine, enlighten- ing, and very germane testimony that we have had today. But to you two. Dr. Challinor and Dr. Jones, we thank you for your excellent presentation. And as I indicated before you gave your testimony to me, it is so vital to our arriving at a decision. I want to express our thanks to both of you for your presentation, which is going to be so germane to the final decision that we are going to make. Now, the Panama Canal has received studies that go to the ques- tion of potential transit of Alaskan oil, and the trends in the ship size of the world fleet. And I ask your unanimous consent that such studies be entered into the record. Hearing no objection, we will so order it. [The material to which reference is made follows :] 32-461 O - 78 - 18 268 PANAMA CANAL TRAFFIC AND REVENUE STUDV^ 1978-2000 January 1978 By: Ely M. Brandes Randall Chun Prepared for: PANAMA CANAL COMPANY (U.S. DEPARTMENT OF DEFENSE) U.S. DEPARTMENT OF STATE International Research Associates 554 MADISON WAY PALO ALTO. CALIFORNIA 94303 The following are excerpts from a report prepared by International Research Associates for the Panama Canal Company and the Department of State. 269 INTRODUCTION This report Is the result of a study which was sponsored jointly by the Panama Canal Company and the U.S. Department of State and which had the following major objectives: (a) to project Panama Canal traffic and revenues for the period 1978-2000; (b) to conduct a sensitivity analysis of future Panama Canal traffic and estimate the effect of toll increases ranging from 15% to 150% on the projected volume of traffic; (c) to make an estimate of the maximum revenue available through tolls; (d) to analyze the long-term effect of inflation on the sensitivity of traffic to toll increases and analyze what effect the toll increases since 1974 had on the sensitivity of Canal traffic to future toll increases. The structure of this report parallels the above mentioned objec- tives. The report is divided into five parts. The first part is a brief summary; the second part presents the traffic projections for the 1978-2000 period both in the aggregate and for 23 commodity categories into which total traffic has been divided. The third part is a transla- tion of the above traffic forecasts, which were made in long tons of commodities, into equivalent forecasts of toll revenues, Panama Canal net tons and numbers of ship transits. The fourth part is the sensitivity analysis which estimates the effect of assumed toll increases ranging from 15% to 150% on the projected traffic estimates. Part of this sensi- tivity study is an estimate of maximum toll revenue. The fifth part is an analysis of toll sensitivity and inflation. In the course of this study a large number of individuals associated with shipping companies, trading firms, port authorities, federal govern- ment agencies, etc., were contacted and most of them gave information that proved valuable for the preparation of this report. However, use of such information should not be construed as assigning any responsibility for the findings of this study to outside contributors. The research team was solely responsible for the selection of data for this report and the conclusions drawn from them. 270 The research team was led by Ely M. Brandes, President of International Research Associates. Principal contributors were Randall Chun and Ray Olzsewski, a consultant. Cameron and Elizabeth Brister were responsible for much of the statistical work; and Martha Hief, Linda Wolf, and Peggy Brandes typed the report. The research team wishes to acknowledge the very valuable aid and assistance given to this project by Mr. Donald G. Schmidt of the Panama Canal Company, the contracting officer, and his staff. They provided the research team with a body of traffic and revenue data that was outstanding in every respect. 271 16/17. PETROLEUM ANP PETROLEUM PRODUCTS Background Petroleum Is not only the single largest commodity shipped In world comnerce In terms of volume, it exceeds the combined total of all other commodities shipped in world trade. By far the largest portion of the world petroleum trade Involves the shipment of crude oil from producing areas to refining and consuming centers. However there is also a large and growing world trade In petroleum products. The present pattern of crude oil shipments around the world is dominated by the fact that more than three fourths of all exports originate in the Persian Gulf around which the producing fields of Saudi Arabia, Kuwait, Iran, Iraq, Qatar and Abu-Dhabi are located. The only large exporters of crude oil which are not located in the Middle East are Venezuela, Indonesia, Lybia, Algeria and the Soviet Union. At the present time, most of the crude oil shipments around the world are made in super tankers or VLCC's (very large crude carriers). The shift to the large carriers began in 1967, when the Suez Canal was closed, and it spread rapidly because of the obvious economics involved in the utilization of large ships. In fact, the construction of large tankers has proceeded at such a furious pace that since 1975 there has been a surplus of crude oil tankers which, given the number of laid-up ships, is likely to last several more years. World trade in petroleum products is relatively smaller in volume and far more diversified than crude oil shipments. And unlike crude oil shipments, the trade in petroleum products is carried in ships of less than 100,000 ton size. The Role of the Panama Canal In relation to total world petroleum traffic, the petroleum shipments through the Panama Canal are not very significant. Even so, shipments of crude oil and petroleum products currently exceed 25 million tons a year II - 57 272 and together constitute the single largest commodity category. Until the early 1970's, crude oil shipments through the Panama Canal involved primarily movements from the Atlantic to the Pacific. Most of the crude oil was shipped from Venezuela and was destined for the west coast of the United States and South America. In 1973, Ecuador became a significant exporter of crude oil and most of its exports went through the Panama Canal to refineries In the United States and Central America. At the same time, shipments from the Atlantic to the Pacific continued as before. (There is a substantial amount of cross-haul traffic In petroleum. This Is caused by the fact that (a) crude oil is not a homogeneous commodity and much of the demand is for specific grades of crude oil, and (b) a large portion of petroleum shipments involves Interplant transfers from producing to refining centers of individual companies. While there is a tendency toward reducing the amount of cross- haul traffic, much of it Is likely to continue.) Most recently, crude oil shipments from Alaska have begun to transit the Canal and, as will be shown below, the significance of these shipments is likely to grow in the future. Shipments of petroleum products through the Canal are quite substan- tial and they were, until 1973, much larger than shipments of crude oil. Since then, crude oil shipments have Increased sharply and now exceed shipments of products. Most product shipments originate on the Gulf coast, in the Caribbean area or the West Coast of the United States and the destinations include the United States, Latin America, Europe, and in some cases even the Far East. Given the multiplicity of petroleum products and a pattern of seasonal demand changes for the various products, there appears to be a constant need to trade surplus or to acquire additional products; and these needs are being met by product shipments. Working against the trend of Increasing product shipments are the desires of individual petroleum companies to save transport costs and this can often be achieved by arranging product exchanges with other oil companies which saves for each company the need to transport the petroleum products Involved. II - 58 273 Recent Developments and Pro.iectlons in Crude Oil Total crude oil shipments through the Panama Canal Increased from about 5. A million tons in 1965 to 12.6 million tons in 1977, reaching a recent high of 16.8 million tons in 1974 when the Mideast Oil Embargo prompted large increases in crude oil shipment from other producing areas. Most of the Increase in crude oil shipments during the 1972-77 period came from Ecuador where oil production and exports began in the early Seventies with the completion of a pipeline from the producing fields to the coast. In the last three years, shipments from Ecuador have declined partly because of disputes between Ecuador and the producing companies and partly because of the current surplus of crude oil. Most of the crude oil shipments from the Atlantic to the Pacific Involve shipments from Venezuela, Colombia and the West Indies, both to the United States and to other Latin American countries. In recent years Venezuela, in particular, has made strong efforts to market Its crude oil and products within Latin America and many of these shipments proceed through the Canal. Shipments of crude oil from Venezuela and the West Indies to the refineries on the West Coast of the United States have. In the past, reflected a general shortage of crude oil within the Pacific region as well as the need for the specific types and grades produced in those areas. At present, when the Pacific region has moved into a surplus position, only those shipments which reflect the need for special grades are likely to continue. Prpjections of future crude oil shipments of Alaska oil are made in a special chapter below. The following is a discussion and projection of crude oil shipments other than Alaska oil for the period 1978-2000. a) Projections made here only involve known oil fields. While there are chances or even a high probability that additional oil fields will be discovered over the next 20 years whose development will require shipments via the Canal, there is no way of projecting them. (To some extent, such future developments will be taken account of by a special allowance made for "new movements" in the traffic projection for the years 1990 and 2000.) II - 59 274 b) Shipments of Venezuelan and Colombian crude oil to Latin American countries, which have averaged between 3 and A million tons a year in recent years, will continue. The amount is not likely to increase in the future as Ecuador and, perhaps Peru, will attempt to market their excess, crude oil in the same market area. c) Shipments of crude oil from Ecuador to the Atlantic area — primarily to refineries in the Caribbean area — have declined from more than 7 million tons in 197A to about 3 million tons. They are likely to stabilize at these levels. Any increase In output is likely to be marketed on the west coast of South America. d) Shipments of crude oil from Venezuela and the West Indies to U.S. refineries on the West Coast, which currently average about 2.5 million tons a year, will decline as the Pacific region becomes a surplus crude area. But a part of this total — perhaps 1 million tons a year or so — will continue to be shipped to meet needs for specialty crude oils. e) In summary, it appears that crude oil shipments via the Panama Canal — other than shipments from Alaska — will be in the range from 8 to 10 million tons a year during the 1978-2000 period. Again this projection is based on presently known fields and includes no assumptions about new major discoveries. II - 60 275 Prospects for Alaska Oil Shipments via the Panama Canal Introduction In the summer of 1977, the first oil shipments were made from the North Slope field in Alaska via the Alaska Pipeline and soon thereafter shipments of Alaska oil began to transit the Panama Canal. At the present time (November, 1977), these shipments amount to about 175,000 barrels per day or 735,000 tons per month. The question of how large these shipments might become, how long they will last and how much revenue they might produce for the Panama Canal has become important, primarily because the absolute amount of additional traffic and revenue might be very sizeable. However, the entire prospect of future Alaska oil shipments via the Panama Canal is surrounded by many uncertainties. The purpose of this chapter is to identify and analyze these uncertainties and to develop a set of assumptions concerning them which appear most probable under the present circumstances. The Present and Short Term Future (1978-1980) At the present time, the Alaska Pipeline delivers more than 700,000 barrels of oil per day to Valdez. This is considerably below the initial rated capacity of the pipeline, and this shortfall in output was caused by an explosion and fire at one of the pumping stations. This damage is being repaired at present and the pipeline should be up to its rated 27 initial capacity of 1,200,000 barrels/day by March or April of 1978. From then until about the end of 1980, production and pipeline delivery is expected to remain constant at 1,200,000 barrels/day. The shipments of Alaska oil via the Canal, which since October 1, 1977, have averaged about 175,000 barrels/day are prompted by a surplus on the West Coat of domestically produced crude oil. This surplus is likely to grow both as a result of increased Alaska oil production as well as an increase in production from the Elk Hills Naval Reserve field. As stated above, Alaska oil production will increase by about 500,000 barrels/day in April, 1978. By 1980, production at the Elk Hills Naval Reserve field is also expected to Increase from the present level of II - 61 276 100,000 barrels/day to about 250,000 to 300,000 barrels/day in accordance with the recently passed federal legislation. Until about the end of 1980, when the SOHIO pipeline is likely to start operation, most of the above 650-700,000 barrels/day of added production will be surplus to needs within District V. There are essentially four ways in which this oil can be disposed of. One, it can displace other imported oil; two. It can go toward satisfying the annual increase in petroleum consumption on the West Coast; three, it can somehow be moved to the East; or four, it can be disposed of by means of a product exchange. As to the first alternative, displacement of other imports, much of this has already occurred. Prior to the start of Alaska oil shipments, imports into District V, which includes the West Coast plus Nevada and Arizona, averaged about 1.1 million barrels/day. Since then, imports have declined to about 650,000 barrels/day, reflecting the current consumption of about 500,000 barrels/day of Alaska crude oil in the district. There may be additional cutbacks in foreign oil imports into District V, but it is doubtful that total imports will decline to less than 500,000 barrels/day because of the special needs for sweet crude oil which is imported from Indonesia. Petroleum consumption is increasing in District V, but the rate of increase is projected at only about 3% per year or an increase of about 60,000 barrels/day each year. Because of the restrictions under the Jones Act, foreign flag vessels cannot be used to transport Alaska oil to the East Coast. However, some small quantities of such oil are being shipped in foreign flag VLCC's around the Horn to the Virgin Islands which are outside the customs territory of the United States. Because of the current oversupply of large crude carriers, such movements are considerably cheaper, at present, than shipment in U.S. flag vessels via the Panama Canal. While such a movement has been found to be technically legal in a recent court decision, there Is a general opinion at the Department of Energy that large scale shipments of Alaska oil in foreign flag vessels would probably lead to II - 62 277 legislative action because such shipments constitute a violation of the 28 Intent of the Jones Act. ~ The last alternative Involves a crude oil exchange which according to present law could only be arranged with Canada or Mexico. Mexico Is building a refinery on its west coast to be supplied with crude oil via a pipeline from Its east coast. This would present an excellent opportunity for arranging crude oil exchanges, except that the potential quantities that could be exchanged there are not likely to be large. Since all of the above alternatives for disposing of the crude oil exist as possibilities rather than as firm commitments, any estimate made as to the distribution of the oil among the alternatives can be no more than educated guesses. And as will be shown later, the consensus among trade experts is that of the 650,000 to 700,000 barrels/day of additional domestic crude oil that will become available, somewhere between 300,000 and A00,000 barrels/day will be shipped east via the Canal. The rest may be distributed among the other four alternatives. Specifically, it is estimated that oil Imports might be reduced by another 150,000 barrels/ day. Increase in consumption might account for an additional 50,000 barrels/day each year, while product exchanges and shipment of oil to the Virgin islands might account at most for 100,000 barrels/day. This would leave the above mentioned 300,000 to 400,000 barrels/day available for shipment through the Canal, in addition to the 175,000 barrels/day currently being shipped. II - 63 278 The Medium Term Future (1981-1985) The end of the near term future is set near the end of 1980 or the beginning of 1981, which currently appears as the most probable completion date for the SOHIO (Standard Oil Company of Ohio) pipeline from Long Beach, California, to West Texas. This pipeline, when completed or rather con- verted from its present status, will provide a capacity for moving 500,000 barrels/day of crude oil from the Pacific to West Texas, which is the western terminus of an extensive crude pipeline network that stretches all the way to the Northeast. The status of the SOHIO Pipeline Project can best be described as highly probable, but not yet certain. It appears that after considerable negotiation, an agreement in principle was reached between the State of California and SOHIO to the effect that in order to compensate for the addi- tional air pollution which the pipeline will cause, SOHIO will donate some major air pollution equipment for one of the large power plants in the area. Negotiations are currently being conducted between the power company and SOHIO. Assuming the successful conclusion of the negotiations during 1978, the pipeline conversion should be completed toward the end of 1980. With the completion of the SOHIO pipeline, it would appear that the volume of oil shipments via the Panama Canal might be drastically reduced, but this is not likely to occur. First, it is possible that the Navy may defer the final boost in production at Elk Hills until this pipeline is in operation, and then seek to obtain some capacity in the line for movement of its oil to the East. (The Navy officially maintains that it has many options available with respect to the disposition of Elk Hills oil. Yet these choices — whether to seek pipeline capacity and build its own connection to that pipeline or build a pipeline to permit tanker shipments — are still open only in the sense that no specific decision has been made on any individual choice. However, if the Navy is to produce from its reserve at the level prescribed by law, it must provide for 29 some facility to get the oil to markets beyond the west coast.) Second, there is a strong probability that as soon as the SOHIO pipeline opens, the consortium which controls North Slope production will seek an Increase in field production from 1,200,000 barrels/day to II - 64 279 1,600,000 barrels/day which is considered the maximum economic rate for that field. The combined effect of all these changes would appear to result in only a slight reduction of tonnage available for shipment through the Canal in 1981. The course of probable development beyond 1981 becomes more uncertain since there exist a number of possibilities which could provide for (1) additional new oil on the West Coast and (2) additional pipeline capacity from west to east. Additional new oil could come from Alaska or off- shore areas, while the most likely pipeline project that could come into services by 1985 is a line 'from Kitimat, B.C., through Alberta and from there to the Midwest. Either event, a new big oil find or a new pipeline, can, by itself, be only regarded as a possibility. However, should a big new oil find occur in the West, the probability of a pipeline following it would increase very sharply. Conversely, without a new big oil find, the probability of building an additional crude pipeline from the West Coast will shrink rapidly. Because of this obvious interrelationship of new big oil and a new pipeline, the effect of either event on future ship- ments through the Canal may be less than originally thought. The Long Term Future (1985 and Beyond) Beyond 1985, the uncertainties concerning oil production in the west and shipment from there multiply. However some future events or trends can still \>e regarded as probable in spite of the many contingencies that seem to surround this subject. For instance. It is highly probable that over the next 7 years or so there will be some significant new, though not necessarily very big, oil discoveries on the West Coast, including Alaska. It is also likely that with such discoveries the West Coast region will continue as a crude oil surplus area throughout the 1980's and beyond. Another trend which is likely to continue is the need to import special grades of crude oil into the West Coast region and these Imports, in turn, will tend to increase 65 280 the amount of petroleum which must be moved to the Midwest and East. Beyond this point the probabilities grow scarce. As stated earlier, the greater the size of the oil surplus that must be transferred by tanker, the greater the chances that new pipeline schemes will be planned and built. But this still leaves a fairly large area of uncertainty covering a possible surplus — beyond the installed pipeline capacity — of anywhere from nothing to 400,000 barrels/day, where a new pipeline scheme would not be economically justified. But even if no good pin-point estimates can be made of the volume of shipments via the Canal, it is likely that these shipments will be declining as a reflection of increasing oil consumption within District V. And this feature of declining shipments should be included in any realistic long term projection of Alaska oil shipments via the Canal. Alternatives for Projecting Alaska Oil Shipments via the Panama Canal A simple method for formulating alternative projections of shipments of Alaska oil via the Canal Involves joining, on one side, assumptions and projections which all would have a negative Impact on the amount of Alaska oil shipped through the Canal; on the other side one can group the assumptions and projections which would all have a positive effect. a) The negative projection . The principal elements of a negative projection are: 1. Prompt completion of the SOHIO pipeline (by mid-1980 or before). 2. No significant future oil discoveries in the West. 3. Rapid growth in petroleum consumption in the West. 4. Maximum replacement of imported oil in District V with Alaska oil. A projection of Alaska oil shipments which incorporate these assumptions would be as follows: FY 1978 350,000 b/d or 16.5 million tons FY 1979 500,000 b/d or 25 million tons FY 1980 450,000 b/d or 22.5 million tons (SOHIO pipeline opened in last quarter) FY 1981 300.000 b/d or 15 million tons II - 66 281 FY 1985 125,000 b/d or 6.25 million tons FY 1990 Nothing FY 2000 Nothing b) The positive projection . The positive projection obviously involves opposite assumptions to those stated above. However, the assumptions chosen here are regarded as normal and not extreme. For Instance, it is assumed that the SOHIO pipeline will experience normal delays, but nothing like those encountered by the Alaska pipeline. An average amount of new oil discoveries are assumed, consistent with current drilling activity. A moderate increase in consumption is assumed, reflecting both the effect of conservation measures as well as of increasing prices for petroleum. Finally, it is assumed that at least 500,000 barrels/day of Imported oil will not be replaced by Alaska oil because of quality and gi^ade consideration. The following projections appear consistent with these assumptions: FY 1978 350,000 b/d or 16.5 million tons FY 1979 500,000 b/d or 25 million tons FY 1980 500,000 b/d or 25 million tons FY 1981 460,000 b/d or 23 million tons FY 1985 400,000 b/d or 20 million tons FY 1990 300,000 b/d or 15 million tons FY 2000 250,000 b/d or 12.5 million tons It is the opinion of the research team that the positive alternative is more 'realistic and the above amounts are Included in the traffic projections. This choice is made in spite of all uncertainties which seem to surround this issue. However, there is one key assumption which is crucial to this or any other forecast of Alaska oil shipments through the Panama Canal: the assumption that the U.S. government will continue to prohibit the sale of Alaska oil to Japan or the disposition of the oil through an exchange with Japan. Should the federal government change its policy on this point, it is likely that all Alaska oil shipments through the Canal would be terminated. The reason for this reservation is simple. XI - 67 282 A crude oil exchange with Japan would be by far the most economic alternative for the petroleum companies. Incremental Revenues from Alaska Oil Shipments Assuming an effective toll rate for Alaska oil shipments of $1.20 per long ton (which corresponds to the present experience) , the following are estimates of incremental toll revenues attributable to Alaska oil shipments (based on positive projection). FY 1978 $19,800,000 FY 1979 $30,000,000 FY 1980 $30,000,000 FY 1981 $27,600,000 FY 1985 $2A,000,000 FY 1990 $18,000,000 FY 2000 $15,000,000 Projection of Total Crude Petroleum Movements In the aggregate, it is projected that total crude petroleum movements will increase sharply from 12.6 million tons in 1977 to 27.2 million tons in 1978 and 34.9 million tons in 1979. From there shipments will decline to 32,2 million tons in 1981, 29.2 million tons in 1985, 2A.2 million tons in 1990 and 21.7 million tons in 2000. Recent Developments and Projections: Petroleum Products In contrast to crude oil shipments, shipments of petroleum products through the Canal have shown no appreciable growth in recent years. In the early Seventies, the annual shipment volume average was 10 to 12 million tons a year. During the energy crisis years of 1973 and 1974, shipment volume rose to more than 15 million tons as many consumers sought to purchase supplies wherever available, which in the aggregate, increased the total volume of petroleum shipments. Since then, shipments have declined to about 10 million tons a year. Most of the petroleum products shipped through the Canal originate on the Gulf Coast, the West Indies, the east coast of South America II - 68 283 r- S r* s s 5 r~ „ „ . . . s En ^ 1 H o ■^ r- •^ s> n 'a- i o S , , o m r-t •H •V g c X O 3 H 3 < t t t t < 5 < < u ^J £ 3 3 o 1 O ^ .-1 o r- i X Q E- 1 j:: o ^ 285 (Venezuela), and the west coast of the United States. The shipment patterns from each of these origin points are quite diverse, and there are only a few shipments which are large and which seem to continue over time. The level of future shipments is likely to be Influenced by two major factors. The first is the continued growth of petroleum consumption which should lead to a concurrent expansion of petroleum product shipments. This is likely to be of particular importance with respect to Panama Canal traffic because the growing supply of Alaska crude oil on the West Coast has led to an expansion of refinery capacity in the area; and such expansion, in turn, will lead to an increase in shipments. The other factor, which will have a negative effect on petroleum product shipments, is the growing desire of oil companies to minimize transportation costs by arranging product exchanges in lieu of cross- hauling through the Canal. In the past, most of the petroleum shipments were made from the Atlantic to the Pacific; in the future, however, the prospective surplus of Alaska oil on the west coast will promote Increased refinery output on the Pacific Coast which, in turn, will displace a portion of present product shipments from the Atlantic. It is anticipated that these opposite factors will offset each other and future petroleum product shipments will remain at a relatively stable level ranging from 10 to 12 million tons a year. The actual projections are for 10,200,000 tons in FY 1978, for 10,500,000 tons in FY 1979 and for 11,000,000 tons per year for the entire period beyond that. II - 71 286 1^ ^ rH c>7 f^ ■R c\7 o O rH rH C\J ON ON rH ^ 00 in cm' 1 1^ lA O r^ r-i I lA lA in ON 00 o o rH rH rH rH ON 2 1 ! 1 ON ^ o rH Z t < 1 <-> 1 H < 1 oa -o 1 rH t 1 i Q rH i ■H +> S) B <; t o i 1S3 5S 287 CHAPTER 2 Projection of Number of Ship Transits a) Analysis of Past Data Over the past 20 years, the growth In traffic has not been matched by an equivalent growth in the number of ships transiting the Panama Canal. In fact, the number of ships transiting the Canal at present Is little changed from the number during the early 1960's, even though the volume of cargo has about doubled. An obvious explanation of this phenomenon is that the average ship size has increased. But this "cause" is largely the effect of deeper causes which have been identified after a careful analysis. In brief, it was found that the reduction In the number of ships as compared to cargo tons was traceable to three separate trends. The first of these was a change in the mix of ships which carry cargo through the Canal, which, in turn, was largely dictated by a change in the commodity mix. The basic ship types include dry bulk carriers, tankers, refriger- ation ships, general cargo ships and container ships; and, over the past ten years, the number of dry bulk carriers and container ships has increased, the number of tankers and refrigeration ships has remained about level, while the number of general cargo ships has declined. Since dry bulk and container ships are larger, on average, than general cargo ships, the combined effect of this change in ship mix was to produce a larger, average ship size. The second factor concerns the shift from general cargo ships to container ships. This is somewhat different from the trend mentioned above in that the change was not required by a change in commodity mix. Both general cargo ships and container ships carry "general cargo" but since container ships are bigger on average, the effect of this shift, too, was to reduce the nOmber of ships required. The third factor was an increase in the average size of ships within each category . The increases in average size were particularly pronounced III 288 with respect to dry bulk carriers and tankers. Table 27 shows the number of ships of the five major categories transiting the Canal during the 1968-77 period, and Table 28 shows the average size ship for each of the categories in each of these years. A sensitivity study which evaluated these factors found that roughly two-thirds of the trend was caused by a change in the ship type mix, both as a result of a change in commodity mix and as a result of conversion from general cargo ships to container ships. One-third of the effect was caused by the increasing ship size within each category. b) Method of Projecting Transit Numbers The above findings served as a basis for developing a methodology of converting cargo projections into projections of transit numbers. In essence, the method allows for changes in commodity mix and the continued conversion from general cargo to container ships to determine the mix of ships that will be required to carry the future cargo. The actual ship numbers are then determined by making specific assumptions about future growth in ship size within each category. The following are the specific steps involved: 1. The cargo projections made for 1978-2000 imply distribution among bulk carriers, tankers, refrigerator, container and general cargo ships. Changes from the present are dictated by changes in future commodity mix (each commodity is allocated to a ship type). At this step, certain commodity categories are allocated to container and general cargo ships together, and the separation between them will be made later. 2. Total cargo tons allocated to each ship type are converted into PC net tons by applying the load factor ratio which is appropriate for that commodity category. 3. The number of laden transits is arrived at by dividing the PC net tons allocated to each ship type by the average size projected for that ship type. 4. With respect to cargo allocated to general cargo and cargo ships, the allocation also provides for a continued shift from general cargo to container ships. Ill - 7 289 Bulk % of Carrier Total Table 27 NUMBER OF PANAMA CANAL TRANSITS BY BASIC SHIP TYPES (1968 - 1977) % of % of Tanker Total Refrig. Total General % of Cargo Total Container % of Total 1968 1784 14.1 1969 2125 16.8 1970 2431 18.7 1971 2589 19.1 1972 2879 21.6 1973 3059 22.8 1974 3480 26.3 1975 3752 29.4 1976 3433 30.3 1977 3551 31.8 2030 16.1 2081 16.5 1954 15.0 1963 14.5 1882 14.1 1769 13.2 2300 17.4 1909 15.0 1693 14.9 1682 15.1 1826 1905 1827 1888 2088 2301 1981 2076 1825 1740 14.4 15.1 14.0 14.0 15.7 17.2 15.0 16.3 16.1 15.6 6847 6348 6534 6789 6047 5488 4458 3945 3218 2955 54.1 50.3 50.2 50.2 45.4 41.0 33.7 31.0 28.4 26.5 169 170 268 301 419 775 1009 1064 1166 1231 1.3 1.3 2.1 2.2 3.2 5.8 7.6 8.3 10.3 11.0 Source: Annual Reports of the Panama Canal Company For the purpose of this Table, the "total number of ships" includes only the above ship types. 290 Table 28 PANAMA CANAL TRANSITS 1968 - 1977 AVERAGE SHIP SIZES OF LADEN VESSELS ('OOO's PC Net Tons) Bulk Tanker Refrigerator General Cargo Container 1968 12.61 8.91 3.61 6.20 15.02 1969 13.10 8.87 4.08 6.17 16.23 1970 13.40 8.78 4.65 6.20 16.64 1971 13.59 8.68 4.26 6.39 14.80 1972 13.91 9.31 3.90 6.42 15.52 1973 14.28 11,24 4.09 6.62 18.78 1974 14.82 11.80 4.64 6,47 17.72 1975 15.30 11.53 4.77 6.54 17.61 1976 15.71 12.51 4.97 6.65 17.43 1977 16.46 13.59 5.42 6.86 16.49 Source: Annual Reports of the Panama Canal Company III - 9 291 5. Total transits for the five ship types are then determined by adding an appropriate number of ballast transits to each of the five ship types. (The ballast ratios are assumed to remain constant for the ship types.) 6. The five major ship types account for about 93-94% of all commercial ocean-going transits. The remaining 800 or so vessels consist of passenger ships, fishing vessels and miscellaneous ships. To allow for these, 800 ships are added to each year's projection of transits. The algorithm for this operation appears below: Cargo Tons shipped (For each ship category) X Load Factor (PC net tons/tons shipped) = PC Net Tons 7 Average Ship Size = Laden Transits X (1 + ballast ratio) Ballast Ratio = ballast transits/laden T J .. c 1. i_j ^ transits = Transits for each ship category L Transits for each ship category = Commercial transits + 800 Miscellaneous transits = Total Commercial transits. c) Assumptions About Future Ship Size In order to make the projection of ship numbers as outlined above, assumptions must be made about (a) the future rate of conversion from general cargo to container ships, and (b) the future rate of size growth for each category. The basic reason why assumptions must be made in these areas is that applying the growth factors experienced over the last few years would yield results that are unrealistic, if not impossible. For Instance, with respect to ship size, the limitations of the Canal itself impose a limit. But long before that, the average size for each category Is likely to approach a limiting value dictated by the fact that the mix of ships will always involve a distribution over a considerable size range. 10 292 The same problem exists with respect to conversion from general cargo to container or later roll-on-roll-off ships, which are regarded by many as the ultimate successor to the general cargo ships. Assuming the continua- tion of the present trend — which shows a very sharp decline in the number of general cargo ships in recent years — would again yield unrealistic estimates for 1990 and 2000. The assumptions made below about future growth in ship size per type and future conversion to container ships generally involve a substantial slowdown in the growth rates. We believe the growth rates, themselves, will continue because the economics of ship operation exert strong pressure in that direction. The slowdown in the growth rate will be dictated primarily by the physical limitation of the Canal. In some instances, special circumstances seem to reinforce this assumption. For instance, the start of the Alaska oil movement will lead to a very sharp increase in the average size of tankers for the 1978-80 period. After that, the growth rate will also flatten out. Below are the specific assumptions made and conversions from general cargo to container ships. a. Bulk carriers . Assumed rate of annual size increase 1977-2000: 1.2%. Actual average size in 1977 - 16,460 PC net tons. Projected average size for 2000 - 21,760 PC net tons. b. Tankers . Assumed rate of annual size increase 1977-2000: 1.7%. Actual average size in 1977 - 13,590 PC net tons. Projected average size for 2000 - 20,200 PC net tons. c. Refrigerator ships . Assumed rate of annual size increase 1977- 2000: 1%. Actual average size in 1977 - 5,420 PC net tons. Projected average size for 2000 - 6,800 PC net tons. d. General Cargo Ships . Assumed rate of annual size increase 1977- 2000: 0.3%. Actual average size in 1977 - 6,860 PC net tons. Projected average size for 2000 - 7,450 PC net tons. e. Container ships . Assumed rate of annual size increase 1977- 2000: 0.5%. Actual average size in 1977 - 16,490 PC net tons. Projected average size for 2000 - 18,500 PC net tons. Ill - 11 293 f. General Cargo to Container Ship Conversion . It Is assumed that by 2000 there will only be 1500 general cargo ships in the mix of ships transiting the Canal. In 1977, there were 2955. In order to provide for a smooth transition from the past to the future, the average ship sizes assumed for intermediate years — between 1978 and 2000 — were determined on a curve. Table 29 shows the projected average sizes for the various ship types for the 1978-2000 period. Using the above assumption and formula, the projected transit numbers (commercial ocean-going vessels types 1-17) are as follows: Transits FY 1978 12,691 FY 1979 12,968 FY 1980 12,903 FY 1981 12,809 FY 1985 12,743 FY 1990 13,312 FY 2000 14,142 III - 12 294 Table 29 PROJECTED AVERAGE SHIP SIZES FOR PANAMA CANAL TRANSITS coco's PC net tons) Fiscal Bulk Refrigera- General Average for Years Carrier 16.46 Tankers 13.59 tor Cargo 6.86 Container 16.49 all Ships 11. 20"'' 1977 5.42 1978 17.24 14.76 5.65 6.92 16.65 11.49 1979 17.61 15.56 5.78 7.00 16.78 11.97 1980 17.90 16.05 5.89 7.05 16.90 12.24 1981 18.10 16.45 5.97 7.08 17.00 12.44 1985 18.90 17.55 6.32 7,25 17.42 13.18 1990 19.50 18.65 6.59 7.38 17.88 13.44 2000 21.76 20.20 6.80 7.45 18.50 14.95 Source: International Research Associates Actual III - 13 295 Mr. ISIetcalfe. Thanks to all of you who participated. And it has been a very fine liearing. The meeting now stands adjourned, subject to the call of the Chair. [Whereupon, the subconnnittee adjourned, to reconvene subject to the call of the Chair.] UPDATING STUDIES OF SEA-LEVEL CANAL WEDNESDAY, JUNE 28, 1978 House of Represextatives, Committee ox Merchaxt Marix'e and Fisheries, Subcommittee on^ Paxama Canal, Washington, D.G . The subcommittee met, pursuant to recess, at 10 :40 a.m., in room 130'2, Longworth House Office Building, Hon. Ralph H. Metcalfe (chairman of the subcommittee) presiding. Present : Representatives Metcalfe and John M. Murphy. Staff present : Bernard Tannenbaum, consultant to Committee on Merchant Marine and Fisheries; Terrence W. Modglin, professional staff; Nicholas T. Xonnenmacher, professional staff, minority; and Mrs. Anita C. Brown, subcommittee clerk. ]\Ir. Metcalfe. The Subcommittee on the Panama Canal will come to order. I ask unanimous consent that we proceed with these hearings in the absence of a minority member. The minority has been most coop- erative, and I am sure the meeting would meet with their approval. We do have permission of the House to meet under the 5-minute rule, so we will proceed. This is the subcommittee's third and probably final day of hearings on whether to update the 1970 sea-level canal study. We are most fortunate to have with us today some top experts on the subject of sea-level canal studies. One of our public witnesses directed the 1970 Atlantic-Pacific study, another contributed eco- nomic analyses, and still another made contributions in the environ- mental field. We also have a witness who will discuss a major alternative to the sea-level canal, the third locks modernization proposal. It is our hope that today's witnesses can provide a dispassionate analysis of the three legislative proposals, that they will speak to the details of the proposals and cogently compare them. Again, the material presented will help the House of Representa- tives and the subcommittee to decide how to respond to the Senate's passage of the Gravel sea-level amendment, or whether any sea-level study should be done in accordance with implementation of the recently approved treaties. Our first w^itness, Howard Marlowe, is appearing on behalf of Mr. Jesse Calhoon, president of the Marine Engineers' Beneficial Association, who could not be Avith us today. INIr. Marlowe is an asso- ciate with Ruttenberg & Associates, an economic consultant firm based in Washington. D.C. (297) 298 Mr. Calhooii was originally scheduled to appear on June 21 with Senator Gravel, but was unavoidably detained in labor negotiations. Mr. INIarlowe has informed us that he has another commitment, so we thought it best to schedule his brief testimony first today. Mr. Marlowe, would you proceed with your testimony ? STATEMENT OF HOWARD MARLOWE, APPEARING ON BEHALF OF JESSE M. CALHOON, PRESIDENT, MARINE ENGINEERS' BENEFI- CIAL ASSOCIATION Mr. Marlowe. Thank you very much, INIr. Chairman. I appreciate your assistance with my time schedule. I am going to read the statement of Mv. (^alhoon. Mr. Chairman, the Marine Engineers' Beneficial Association appreciates this opportunity to express our views on legislation which wonld assess the feasi- bility of a new. sea-level canal. As you know, our members are engineers aboard U.S. -flag vessels, many of which use the Panama Canal to transport oil and other vital cargoes between Atlantic and Pacific Ocean ports. Because of our commitment to a strong U.S. merchant marine to act as our fourth arm of defense as well as to promote our foreign and domestic commerce, we support the proposals advanced by Chair- man Murphy and by Senator Gravel and Magnuson to investigate the construc- tion of another sea-level canal. If our merchant marine is to grow in size and strength; if our country is to reap the full l)enefits of waterl)orne commerce ; and if we are to maintain our military might, it is essential that we act now to anticipate what will surely be the saturation of the present Panama Canal within the next several years. On the heels of the recent great national debate over the Panama Canal Treaties, there can be no doubt of the value which the American people place on this suliject. That debate focused on the degree of reliance which the United States could place on its continued access to the canal. The deliberations of this subcommittee take that debate to its next logical step. Recognizing that the present canal has its physical limitation, the legisla- tion before the subcommittee would explore the alternative of constructing another sea-level canal to determine whether this alternative is feasible in light of economic, military and environmental considerations. For three quarters of a centui'y, the Panama Canal has been the singlemost important stimulus to waterbonie commerce in the United States. As such, it has been a vital factor in the development of our economy. .Tust as important, the canal has helped to make this Nation strong by affording our military forces with the maneuverability they need in time of crisis. The very knowledge of that maneuverability has acted as a strong deterrent to our enemies. This subcommittee is well awai'e, however, that many of our Nation's merchant and naval vessels cannot use the canal because they are too large. For the same reason, still otlier ships cannot transit the canal fully laden. And today, when we need the canal to transport Alaskan crude oil from the west to east and gulf coasts, that oil must be lightered to smaller ships liefore enter- ing the canal at a significant increase in cost. Ten years ago a commission studied this issue, and concluded that the con- struction of another sea-level canal along a route 10 miles to the west of the present canal would be feasible. Tliat study must be updated so that Congress and the American people will know how much a new, sea-level canal will cost, what its potential economic impact will be, and what it will mean to the in- tegrity of the environment, as well. The need for such a study grows with each passing year. As of 1975, nearly 20 percent of newly Iniilt bulk carriers and two-thirds of newly built tankers were too large to transit the Panama Canal. In terms of the world's total fleet of bulk carriers and tankers, the canal is offlimits to more than one-third of all vessels who together account for more than three-fourths of the world's tonnage capacity for those classes of ships. Mr. Chairman, these facts demonstrate that we must find an alternative to 299 the present canal if the United States is to continue its reliance on waterhorne commerce. Equally important as the commercial limitations of the Panama Canal are its military deficiencies. The present canal can be incapacitated with ease. It is also too small to liandle our aircraft carriers. Not only does this weaken our defense capabilities, but it also recpiires us to send carriers with destroyer escorts around the southern tip of .South America at a subs'.antial increase in cost, and an equally substantial loss of time. In his introductory remarks in support of le,t?islation similar to that which is now before this Subcommittee. Senator Gravel estimated that a new, sea- level canal would result in $20 million in military savings alone. As an exam- ple of potential savings in the nonmilitary sector, the Senator produced esti- mates indicating that the transportation costs over a new canal route would be 71 cents per barrel less than tlie waterhorne transportation system involving the existing canal. Using a 500,000-barrel-a-day surplus of Alaskan crude oil as an example, the new canal would produce about $1.3 Inllion in savings over a 10-year period. To these direct cost benefits must be added other tangible economic benefits which can result from a new. sea-level canal. The physical limitations of the present canal have served to depre.ss the demand for new American ships. A new canal would revitalize American shipping and, therefore, American ship construction. That means more construction jobs, more maritime jobs, ex- panded port activity with a resulting boost to the economies of port cities, and more jobs ashore in service occupations. Mr. Chairman, these facts are not meant to be definitive statements about the advantages of a new, sea-level canal. Instead, they are designed to show that the United States has a significant economic and military stake in determining just what the feasibility of such a new canal is. That is why the marine engi- neers support the proposals now before this subcommittee, and that is why we urge their swift passage. Mr. Metcalfe. Thank you, My. INIarlowe. I believe I am correct in stating that most of the large tankers in the world today are imdcr the foreign flag, not the U.S. flag? ]SIr. Marlowe. That is correct. Mr. Metcalfe. I am concerned about our merchant marine. If a sea-level canal were seen to be feasible, and were constructed, would U.S. shipbuilders respond to this, or rather, would cargoes now on smaller U.S. ships go to larger foreign-flag vessels? Mr. IVIarlowe. Mr. Chairman, I feel very confident in saying that the market for neAv ship construction uncler the U.S. flag is there. All that is needed is the business. "We have seen, for instance, that U.S.-flag ships have been able to handle all of the surplus Alaskan crude oil, which was a question mark a year ago at this time. But when the business was there, the U.S.-flag tankers were there. In terms of new business, where new construction is required, I have no doubt that it can be done by U.S. shipping companies under U.S. flag. Mr. ]\Ietcalfe. Thank vou verv much. Mr. Modglin? Mr. Modglin. Xo questions, Mr. Chairman. Mr. Metcalfe. Mr. Xonnenmaclier, do you have any questions? Mr. XoNXEXMACiiER. Yes, Mr. JNIarlowe, on page 1 of your testi- mony you state, in your third paragraph, "it is essential that we act now to anticipate what will surely be the saturation of the present Panama Canal within the next several years." "\Anien, more or less precisely, do you expect this saturation ? Mr. Marlowe. I would say, from the studies that I have read, between 10 and 15 years. Certainly by the end of the century. 32-461 O - 78 - 20 300 Mr. NoNNENMACHER. Wc had testimony from Mr. Constant of the Canal Co. yesterday to the effect that they did not foresee it until after the turn of the century, sometime into the next century. I got the impression that they felt that the present canal would be adequate. Would you enlarge upon your concept that a sea-level canal would revitalize American slapping, and therefore American ship con- struction ? Before you do, I want to set the background against Avhich I ask the question, and that is the matter of trade routes. A new sea- level canal, in order to revitalize shi])ping, and encourage ship con- struction in this count ly, I would think, would necessarily open up completely new trade routes, or make some existing routes more heavily utilized. Mr. JNIarlowe. Basically, I am referring to the size of the ships involved. Mr. NoxxENMACiiEit. I appreciate that, but the size of the ships that would go through the canal is still secondary to the destinations of the ships, their routes. Now, Senator Gravel has made a major point of the oil tonnage in the world that cannot go through the present canal. Yet it is quite clear that, except for Alaskan oil, no oil goes through the canal, worthy of mention. So the size of the oil tankers does not even matter. I am not saying that is true in the case of Alaskan oil. But in the light of this type of background, what would happen to trade routes? Would the sea-level canal do anything to change trade routes? ]Mr. ]Marlowe. I am not sure it would change trade routes. I think size of ships does matter cpiite a bit. The age of the U.S. -flag fleet, as you know, is old. We have a lot of tankers constructed during World War II, some even before World War II, still in active service. The reason for that is that there are no small tankers with some few exceptions, being built anywhere in the world today. Small tankers are not economically feasible any more, and that is why we got into supertankers of 100,000 tons and above. Now, in my judgment, what a new canal would do would be to encourage the old tankers that are still in service, to be scrapped, and new tankers which are more economically feasible, and I think more envii'onmentally acceptable, built in their place. That is why I believe that the new canal would encourage ship construction. Mr. NoNXEXMAciiER. But they would continue to ply the same routes that presently use the Panama Canal? Mr. Marlowe. Sir, to the best of my knowledge, that is correct. Mr. NoxNEXMACHER. Would they collectively haul more cargo? Is there a demand for more cargo on the same routes, even should larger tankers or carriers be built that could utilize the sea-level canal? INIr. ISIarlowe. I honestly cannot answer that question. It is some- thing that I would be happy to look into and provide a response to. It is an important one. INIr. NoxxEx:\rAciiER. I would appreciate it. Thank you very much. Thank you, ]Mr. Chairman. [The following was received for the record :] 301 Would a Xkw Sea-Lkvel Caxal Encoukagk the E.s'iai!Msiiment oe New Tkade Routes? The importaneo of a new sea-level canal from the Marine Engineers' point of view lies in the invigoratlon which it will provide to the American merclmnt marine, the American shipbnilding industry, and the American economy as a whole. This will come from increased trade along existing routes, as well as the construction of new, larger U.S.-flag ships. But it will also come — in all likelihood — from new trade routes. While this is a subject which must be thoroughly probed by the new sea- level canal study whicli the Marine Engineers favor, my own preliminary in- vestigation suggests the following new trade routes as examples, eastern coal from Hampton Roads to Japan ; grain shipments from the Midwest to the Far East ; timber movements from the W^est to the East ; and new Alaskan oil discoveries to the Gulf and East Coasts. Mr. Metcalfe. Thank you. Mr. Tannenbaum is i-ccognized next. Mr. Tannenbaum. I understand there are problems in putting superships through a long, narrow canal. Could you give us your opinion on that subject? Mr. Marlowe. I am going to gi\'e you a limited opinion, and then ask if we could have one of the union's maritime-trained people, respond in greater depth. My specialty is economic analysis, and not the professional aspects of the merchant marine. There are maneuverability problems to any large tanker. In terms of tight areas, with limited draft, there have to be maneu- verability problems. Plowever, quite a bit has been done in recent years in similar types of situations with large tankers, to train masters of ships, and deck personnel in the navigation of super- tankers in limited areas. My judgment is that it does not present a serious problem in the sea-level canal, but I woidd like to get union personnel to respond to you, and I would be happy to do that, so that you have some expert opinion on that. Mr. Tannenbaum. Would you provide that? Mr. Marlowe. Surely. Mr. Tannenbaum. Thank you very much. [The material was not available at time of printing.] Mr. JVIetcalfe. Thank you very much, Mr. Tannenbaum. There is a vote on the floor. The subcommittee will now stand in recess for 15 minutes. [Short recess.] Mr. Metcalfe. The Subcommittee on Panama Canal will come to order. Our next witness this morning is Col. John P. Sheffey. retired. Colonel Sheffey is the former ^Military Assistant for Canal Affairs of the Office of the Secretary of the Army. He is also the former Execu- tive Director of the Altantic-Pacific Interoceanic Canal Study Com- mission. In addition, Colonel Slieffey was formerly the Special Advisor to the ILS. Panama Canal Treaty Xejzotiator. He is currently the execu- tive vice president of the National Association for Uniformed Serv- ices. 302 Colonel Slieffey has been available to us on numerous occasions, has been a great source of information, and it is a great consolation when we know that we can call upon you. Colonel. We are happy to have you with us today. STATEMENT OE COL. JOHN P. SHEFEEY, (RET.), FORMER MILITARY ASSISTANT EOR CANAL AFFAIRS, OFFICE OF THE SECRETARY OF THE ARMY, FORMER EXECUTIVE DIRECTOR, ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY COMMISSION, FORMER SPECIAI ADVISOR, U.S. PANAMA CANAL TREATY NEGOTIATOR, AND CUR- RENT EXECUTIVE VICE PRESIDENT, NATIONAL ASSOCIATION FOR UNIFORMED SERVICES Colonel Sheffey. Thank you, Chairman Metcalfe, v It is a privilege and a pleasure to appear once more before this subcommittee to discuss the prospects of an Isthmian sea-level cajial. I have participated since 1961 in providing the Merchant Marine Committee facts and opinions for consideration in its actions on leg- islation dealing with the canal. I feel personally indebted to Mr. Bonner, Mrs. Sullivan, Mr. Mur- phy, and the many other members and former members of the com- mittee who made possible the 19G5-70 sea-level canal study which I had the honor of directing. I am confident that the proposed review and updating of this study will find it an adequate basis for current sea-level canal deci- sions, once current costs and political and economic judgments are incorporated. The IVIerchant Marine Committee authorized us to spend $24 mil- lion for the 1965-70 study. We accomplished it for $22 million, and it could have been done equally well for half that, had we not been required to determine simultaneously the political, teclinical, and eco- nomic feasibility of nuclear canal excavation. Nuclear excavation turned out to be politically infeasible beyond a shadow of doubt, so the millions we spent on accumulation of technical data on the nuclear routes need not have been spent. However, the money was not wasted, for the knowledge acquired is a valuable addition to our understanding of the Isthmian area. The availability of these data and evaluations will make it possible for the proposed new study to select the most promising sea-level canal route at insignificant additional cost to the United States. The important lesson from this experience is reflected in Mr. Murphy's bill. That is, his proposal would determine first whether the current economic, political, and military cases for a sea-level canal are sufficiently persuasive for the U.S. Government to seek its construction. Only if the new Commission finds this so should the huge expenditures required for a comprehensive environmental im- pact study be authorized. The environmental study is necessarily open ended. It must go on before, during and permanently after sea-level canal construction. Unfortunately, even if unlimited funds are provided for such a study, it will not be possible to prove that there will or will not be 303 harmful impacts on the. ocean populations if the two oceans are linked by a sea-level canal. There simply is no way to determine through study and laboratory experiments everything that might actually happen. Some etfects may not be known for a 100 years or more after the canal is opened. If the sea-level canal is ever to be built, the decision is going to have to be made to accept some measure of environmental risk. In 1970 the Sea-Level Canal Study Commission concluded that there were no identifiable threats to commercial or sport fisheries in link- ing the oceans. Neither was there any reason to believe that cata- strophic changes to the ocean populations would take place. The Commission reported that the risks appeared to be acceptable, but recommended fuither study. A comprehensive study will help define the risks, but its real value will be in its inventories of the current ocean populations in order that change can be recognized in the future if the canal is built. It will take a minimum of 15 years to negotiate, finance, plan and build the canal, so there is plenty of time for base-line studies after the decision is made to seek con- struction. In view of time limitations on my testimony, I believe I will serve you best by simply giving you some of the views that I have de- veloped in my 17 years of work on the canal problem. If you wish to know the rationale for any of these views, I will be glad to respond to your questions. First of all, I fully support Senator Gravel's and Chairman Mur- phy's objective of reexamining the case for a sea-level canal in light of the many developments since 1970 that might bear upon its feasi- bility. The 1970 report confii-med the technical feasibility of a con- ventionally excavated sea-level canal in Panama, and recommended that : When the rights and obligations of the United States inider new treaties with Panama are determined, the President reevalnate the need for and desir- ability of additional canal capacity in the light of canal traffic and other de- velopments subsequent to 3970, and take such further steps in planning the construction of a sea-level canal on Route 10 as are then deemed appropriate. Reconsideration of the choice of routes by the proposed inter- oceanic canal study council would be a most appropriate first step. The impracticability of the routes outside Panama, however, is self- evident upon close examination. I believe this review could be accomplished quickly at little cost. The one year and $1 million pro- posed in Murphy's bill are more than adequate. Adequate new evaluations of the technical, financial, political and military aspects of a sea-level canal can easily be accomplished for $2 million in 2 years, I would be glad to elaborate on how this should be done. There are unsolved problems in putting superships through a long, narrow canal. They cannot simply steam through under their own power. Sucli ships avoid canals, and there is no accumulation of experience with their handling problems under such conditions. Bow- thrusters and tugs of a type and power yet to be designed will be needed. High operating costs and slow transits appear inevitable. This is one of the several reasons why the long, winding canal routes outside Panama are infeasible. 304 The 1970 sea-level study report is based upon a one-way canal channel designed to accomodate 150,000 ton ships at all times, and 250,000 ton ships during the twice-daily high tides. This design was estimated to cost $2.8 billion in 1970 for construction in 1970 for construction on Ruote 10. The entire area is unstable and slide-prone. Unforeseen excavation slope stability problems could greatly increase costs, and final canal design could be vastly more expensive. You should be thinking in terms of $8 l)illion and up as a minimum cost in 1978 dollars for the shortest possible canal in Panama. Other routes will be far more expensive. It is not possible to make a reliable analysis of the financial feasibility of a sea-level canal. Only a range of possibilities can be developed which will show that under some future conditions the canal v\-ould pay for itself and some it could not. Almost every factor that must be considered in the financial anal- ysis is unpredictable over the long term. Canal design, construction costs, interest rates, construction time, canal operations and main- tenance costs, payments to the host country, environmental protection costs, potential canal tonnage, potential tolls, developments in com- peting transportation, political stability of the host country, and many others can each vary greatly from expectations. Yet any one of these variables could render a sea-level canal financially infeasible. Local or international hostilities are additional unpredictables that can drastically affect canal traffic. You already have my views on the wisdom of making the environ- mental study a follow-on study, conditional upon the President's decision to seek sea-level canal construction. If such a decision is made, the environmental study agency should be conceived as a per- manent agency that not only will make the preliminary studies, but also will continue its work indefinitely after fhe canal is built. ]\Ir. ]\Ietcalfe. Will you suspend at that point ? There is a bell, and the second bell has rang. So we will proceed when I come back in 15 minutes. Thank you very kindly. [Short recess.] Mr. Metcalfe. The subcommittee will come to order, and Colonel Sheffey will resume his testimony. Colonel Sheffey. ]Mr. Chairman, I will pick up with the para- graph that I left off on. You already have my views on the wisdom of making the environ- mental study a follow-on study, conditional upon the President's de- cision to seek sea-level canal construction. If such a decision is made, the environmental study agency should be conceived as a permanent agency that not only will make the ]n-eliuiinary studies, but also will continue its work indefinitely after the canal is built. I am not qualified to estiuiate how much this study would cost, or how long it would take to prepare a useful environmental imjiact statement. I do believe I know enough about the )>roblem to em- phasize to you once more that it cannot be determined Avliether there will or will not be harmful impacts on the ocean environment if the canal is built. The pojudar belief tliat the ])resent fresliwater lock canal is a com- plete barrier to transit of saltwater fauna between the oceans is quite erroneous. ]Many types of swimmijig and floatiug saltwater org-anisms 306 can survive the freshwater transit. The saltwater tarpon is known to have made the transit, and others surely have (U)ne so too. Numerous forms of ocean plant and animal life <2;o throuii'li on the hulls of ships, and still others 12:0 throu<>-h in the ballast watei- that shii)s take on in one ocean before entering the canal, and dump in the other ocean as soon as they reach it. No one laiows what portion of the ocean population has been inter- changed in these ways, but it has to be a very large one. To date there have been no identifiable environuiental impacts whatever. Any way, the Atlantic and Pacific Oceans are not sealed off from each other. They are joined by warmwater through the Suez and Mediterranean, and by temperate and cold water around the South- ern Capes and under tlie North l*ole ice. Another reason to believe the environmental risk acceptable is the fact that the oceans were once joined at the isthmus. The populations on both sides have a comuion ancestry, and many species in both oceans are highly similar. There is no known technology that would provide a fully effective, practicable barrier to the transit of marine life through a sea-level canal. A partially efrecti\(> barrier can be provided within reasonable costs by maintaining a freshwater seguient of tlie canal between tidal gates at each end. This Avill not fully seal off saltwater from the freshwater portion, and tidal gates will limit the transit capacity of the canal. Tidal gates are needed anyhow to control the tidal currents in the canal, so the maintenance of a fresh water segment between them for environmental purposes will not greatly increase construc- tion and operating costs. However, many types of ocean life can sur- vive passage through the fresli or brackish water segment. There is a strong military case for a relatively indestructible sea- level canal. It is unlikely, however, tliat the Department of Defense would agree to trade oft" other inilitary needs in order to fund some of the sea-level canal's construction cost in the DOD budget. The government of Panama has not in the i^ast been receptive to construction of a sea-level canal in Panama. They have objected to any arrangement that would extend the IT.S. presence or U.S. control, and are also concerned that canal construction would create a boom- bust impact on the Panamanian economy. If a Panamanian route is coniiruied as the best choice by the pro- posed interoceanic canal study council, it is essential that the Panama Sea-Level Canal Study Commission be a joint I^.S. -Panamanian body as envisioned in the new Canal Treaty and in both Senator Gravel's and Chairman Murphy's proposals. I believe that Panama will eventually recognize that construction of a sea-level canal would be beneficial to Panama, even though some arrangement to secure the I^.S. guaranteed investment will obviously be required. Because of the long term political uncertainties and the impossibili- ties of reliable economic forecasts for the 50 years or more required for sea-level canal construction and amortization, oidy Government supported financing is feasible. It is not an attractive business propo- sition. It will absorb $8 billion or more over a period of at least 10 years from the begimiing of construction before it produces 1 cent of 306 revenue. Accumulated interest will add significantly to the total debt during that period. Kevenues might be sufficient to repay this debt, and they might not. However, this is not a reason for ruling out sea-level canal con- struction. The investment picture in 190;^ for the present canal was equally dismal. Its costs have now exceeded its revenues by $1 billion, but we have never regretted building it. Its total value to the United States in peace and war has far exceeded its direct losses, and a sea- level canal would have enormous political and military values in the future that cannot be quantified in dollars. The United States should eventually build it even if its financial prospects are found to be only marginal. Building a third set of locks for the present canal large enough for superships would be an irresponsible act. The cost would be two- thirds as great as for a sea-level canal for the same ships, huge operat- ing costs and enormous water supply problems would ensue, and the critical military vulnerability of the lock canal would be unchanged. In addition, future enlargement of locks is impossible, while a sea- level canal can be progressively enlarged to whatever capacity is needed in the future. I recommend approval of Chairman Murphy's proposed bill as the most economical and efficient way of accomplishing the objectives of Senator Gravel's amendment to H.R. 8309. Thank you. Mr. Metcalfe. Thank you very much. Colonel Sheffey, for your very fine statement and your candid views. Based on your experience with the Atlantic-Pacific Couimission, would you elaborate upon your statement that it would take a mini- mum of 15 years to complete a sea-level canal? Colonel Skeffey. Yes, sir. In the 1965-70 studies, we estimated that it would take 3 to 5 years to negotiate an agreement with Panama, and that is very optimistic in light of the exi)erience since then. Dur- ing that period, the construction plan would be finalized or at least put into sufficient detail for initiating construction, and the forces for building the canal would be mobilized. The actual construction time, once all this is behind, would be at least 10 years based upon the efficient use of the equipment and the very great problems of moving such huge voluuies of earth. It would be possible to shorten the construction time a small amount, by more intensive ap]:)lication of equipment. By that I mean the most efficient way to build it is with equipment that is designed to last for the entire period of construction and more or less wear out at the end. If you put in 10 times as much equipment and build the canal along its whole length simultaneously, then that construction time can be shortened somewhat, but not very much. The big problem is that the disposal of excavation spoil almost has to be at either end of the canal. The best way is to take it by barge and dump it at sea. If you do it any other way the cost can go up drastically. We envisioned a total of 10 vears to be the minimum time for building a canal on Route 10. Mr. Metcalfe. Colonel, would you also elaborate on the statement that you made. "New evaluations of the technical, financial, political. 307 and military aspects of a sea-level canal can easily be accomplished for $2 million in 2 years" ^ Colonel SiiEFFEY. Yes, Mr. Chairman. First of all, the updating of the construction cost is not a very complicated problem. It is a matter of applying current costs to available data for the most part. The Corps of Engineers has indicated they might want some addi- tional on-site data which would be core drilling and that sort of thing. Very little of this is really necessary because tlie accuracy of any such estimate is so limited, even with maximum information, that by acquiring maximum infoi-mation you do not improve the quality of the estimate very much. The canal will not be designed in its en- tirety until it is actually built. That is, it will be designed as con- struction proceeds. You will not knoAv how much excavation that really has to be done until you start excavating and getting some slides, and you have to keep excavating until stability is achieved. My point is that updating the construction cost is not a very time- consuming or very expensive problem. The other evaluations, the projection of revenues and projections of other costs, operating costs, payments to the host country; these are not very time consuming problems. A year or two is more than adequate for them, and the possibilit}' of reliable forecasts just is not there. You can spend $1 million on a revenue projection and, in .5 years, it will be worthless because no reliable economic forecast of this nature can be made far into the future. It is just not possible, and I am sure the economist who will testify later will confirm this. We can give good educated guesses of a cost and revenues and a range of possibilities. If one thing happens, you will have certain revenues ; if something else hap- pens, you will get different revenues. We can give you an envelope in which to estimate your cost and revenues, but no human being can give you the reliable projections far into the future that you really need. ]My point is that a fairly unsophisticated updating of the cost is all you need. ]Mr. ]Metcalfe. Yot; cited a host of economic factors that must be regarded as uncertain and unpredictable in the long run. Do you think that spending large amounts of money for economic studies is unjustified? Colonel SnEFFEY. I think the figure in Chairman Murphy's bill is a reasonable figure. Anything beyond that, I would say, is highly un- justified, and I think it could be done for less than that. Mr. INIetcalfe. You have described the outlook or return on U.S. investment in a sea-level canal as dismal. What are some of your experiences in the 1970 study that lead you to that conclusion? Have these factors changed since 1970? Colonel SiiEFFEY. Well, it would take a more skillful economist than I to tell you correctly whether they have changed or not. The problem we found in the 1970 studies is "that you cannot really fore- cast the factors that go into your cost — interest rates, for example. A Government interest rate siibsidized at 6 percent might make the canal feasible. Private investment interest rates at 10, 12 percent would make it infeasible. So there is one single factor that can make it feasible or unfeasible. 308 In the 1970 studios we assumed a maximum of 22 cents a ton reve- nue royalty to Panama, and took that off the top. The payments to Panama now are twice or three times that. If the revenues do not ^o up much more than we projected in 1970, and it does not look like it is ^oin^ to happen; an $8 billion canal simply can not be financed from revenues. I repeat, INIr. Chairman, that nobody can tell you what is going to happen to world trade 50 years out. I will give you a classic example that we came upon in our studies. In 1955, the chairman of the Consolidation Coal Co., in a meeting of the coal producers of the United States, said that, in his view, there would never be another ton of coal shipped in international commerce from the United States; that the cost of production in the TTnited States made it impractical to sell overseas. Less than 10 years later, the biggest single commodity moving through the canal was coking coal from West Virginia going to Japan. Even the president of the Consolidation Coal Co. did not foresee that. In our 1970 studies, we predicted an ever-increasing import of coal to Japan. They opened their own coal port and mines in Canada on the Pacific coast, and coal now is declining as a commodity moving through the canal. Xobody can tell you what is going to happen to the canal traflic. Xobody. Mr. Metcalfi:. I regret to say that there is another bell. We will susj^end for 15 minutes. Colonel SiiEFFEY. I am at your disposal, INIr. Chairman. [Short recess.] Mr. Metcalfe. The hearing of the Panama Canal Subcommittee will now come to order. Colonel Sheffey, as executive director of the Atlantic-Pacific Com- mission, you participated in discussions with foreign governments on the terms of agreement for a new sea-level canal. What are some of the terms that we should expect from any host government, and do you think these terms are likely to have changed since 1970? Colonel SiiEFFEY. The history of the treaty negotiations in a way answers that. The original plan, when President Johnson agreed to enter into negotiations, was to include in the new treaty for the re- lationship with Panama the right to build a sea-level canal. The 1967 treaties were written on that basis. When those were rejected, I par- ticipated in writing the 1971 draft treaties which had a much weaker option for the canal in it because, by then, we were not very opti- mistic that the canal would ever be built. As you know, the present treaties which have been ratified now have no right at all for us to build it, merely the right to study it jointly with Panama. I think it is pretty obvious what the U.S. would have to have in an option to build the canal. It would have to have the right to acquire the land and other facilities necessary for it. We would have to have some kind of guarantee of the physical security of the canal and security of the debt that would be created in building it. We would have to have some control over the handling of the revenues, some commitment that the debt would be serviced. In other words, it would require the Panamanians to let us con- tinue to have a considerable measure of control over the canal far 309 beyond the year 2000, which is not envisaged in the present treaties. Mr. Metcalfe. Thank you. You stated on pag:e 7 that "A sea-level canal can be prop:ressively enlarged to whatever capacity is needed in the years to come." Does this mean that a sea-level canal channel could be widened beyond its initial 550 to 600 feet channel to accommodate very largo tankers ? At. what cost? Would there not be greater danger due to the in- stability of slopes around the canal? I think you addressed yourself to that in your testimony, but I would like for you to elaborate on that. Colonel SiiEFFEY. Yes, sir, I would be glad to. The objection to the third locks as a permanent solution to the canal capacity is that once locks are built, there is no way to enlarge them except to destroy them and build a completely new and bigger one. Or you have to go off further to one side and build a new set of locks. You cannot enlarge the original locks by any Iniown engi- neering means. A sea-level canal built in the earth itself lends itself to slow, progressive enlargement. The present canal channel has been enlarged tremendously since it was built. The concept for the most economic and efficient canal in our study was to first build a one-way channel, 550 feet wide and deep enough to accommodate 150,000-ton vessels at all times, and at a high tide 250,000-ton vessels. This one- way channel would be operated with alternate north-south convoys, at least two convoys a day and possibly, for fast ships, more than two convoys a day. As traffic increased, a center passing lane, a similar separate chan- nel, would be built in the center 20 miles or so and convoys would enter simultaneously from north and south and pass at the center of the canal in physically separated lanes. As the canal traffic further increased over the years, the passing lanes would be extended all the way across the Isthmus and you would have two separate one-way canals. These would be designed so that their width, the width of each of these two separate channels could forever be widened just by digging from the sides away from center on each side, and further digging it deeper as the ships got bigger. It could be enlarged indefinitely. For a lock canal it would cost almost as much to build an enlarged lock for larger ships in the future as to build the canal originally. Mr. Metcalfe. I know that you indicated that you favor Chair- man Murphy's bill, H.K. 13176, as the best way to accomplish an update of the sea-level study. That bill does not provide any funds for environmental studies until other aspects of the update have been completed. If the environmental funding were done immediately rather than after 2 years, would that malce the findings more useful? _ Colonel SiiEFFEY, A definitive environmental study will take a very long time. Every bit of time devoted to it is useful, A year's study is better than no study at all. A 2-year study is better than one. Again, I am not expert enough in this field, and you have expert witnesses followinir me. 310 JNIy judgment, based upon the knowledge I acquired from the en- vironmentalists during the 1905-1970 studies, simply is that they cannot tell you, over any length of time, definitively, whether or not there will be environmental harm to the ocean populations by mak- ing the canal. They can merely improve their guess, and right now the total populations of the oceans are not known. There is no inven- tory of the hundreds of thousands of species and subspecies that populate both oceans, and no one can tell without very lengthy stud- ies, which of these might be a threat to the other. But the problem is, in my judgment, Mr. Chairman, is that it is not possible to duplicate in the laboratory, conditions which will ex- ist when the oceans are joined. There is no possible way to make a laboratory model similar to the oceans, nor is any reasonable length of time sufficient to reliably predict what will happen. You can experiment on various creatures for 6 months or 1 year, but some of the impacts will not be known for 50 or 100 years. In the end the decision is just going to have to be made to accept the risk based upon the best knowledge available. I know when we first started this, the starfish was eating up the barrier reefs north of Australia, and the environmentalists were quite sure that the starfish was going to destroy the coral reefs, and change the whole ocean condition there. It turned out, in the 10 years since then it was just an aberration in the constant battle between the starfish and their enemies. Their enemies are increasing again, and the starfish is not now a threat to the reef. That is why I recommend that we have some fair assurance that we want to build a sea-level canal for other reasons before any significant amount of money is spent on the environmental impact. The environmental money would be wasted, unless the U.S. decides that it really wants to build it. Mr. Metcalfe. In the first part of the answer to the question you did sort of disqualify yourself, and thought that we should adhere to those with more scientific training and background, and then you elaborated on your answer. Am I to assume now that you would then accept the response of these very clistmguished and qualified witnesses, some of whom have already testified before us, and more to come? Colonel SiiEFFEY. That Mr. Metcalfe. Because you paint a very dismal picture. Colonel Sheffey. Mr. Chairman, that is a hard question for me to answer, because a little Iniowledge is a dangerous thing, and my knowledge, of course, in the marine biology field is quite small. I do believe that the opinions that I have given you are well founded, and I would like to see you cross examine more expert wit- nesses than I on the statements that I have made. To answer your basic question, I think if an environmentalist tells you that he can give you a reliable prediction of the impact of the sea-level canal, I would not believe him. I do not believe it is possible. On the other hand, if they tell you that there is no threat, that is not reliable either, because no one really knows. The threat, I think, is acceptable. If we had to decide on the Erie Canal again, I think we would build it any way, even if we knew the sea lamprey was 311 going to get through it. The starlings in the United States, I do not think we would have spent a lot of money to prevent them from coming. These are things that happen, and we learn to live with them as we make advances in technology, in engineering, and in development of new communities and new facilities. A price has to be paid. Mr. Metcalfe. Thank you very much, Colonel Sheffey. I recognize Mr. Terry Modglin. Mr. Modglin. Thank you, Mr. Chairman. Colonel Sheffey, as the key figure in the direction of the daily ac- tivities of the Atlantic-Pacific Commission during the 1960's, "what does your experience suggest in terms of the powers that the Canal Study Commission must have in order to function administratively in a reasonable way? Colonel Sheffey. The general powers of an independent agency, that is, to make contracts, to buy equipment and property, I could not delineate them all, but whenever you set up a separate agency that has to do its own housekeeping, and to administer contracts, those powers are essential. I believe a commission like this could satellite on an existing agen- cy. Our Commission did not have independent agency powers; that is why I think they are essential. However, we satellited on the Corps of Engineers, and had a satisfactory arrangement. They administered our contracts and our funds, and we reimbursed them from our appropriations. I think this new commission should follow basically this pattern. But for freedom of action they should have powers to do things on their own. Mr. Modglin. Paragraph 2 of section 102 of the chairman's most recent bill, H.R. 13176, mandates the Interoceanic Canal Study Council to take into account, and to report upon political terms of agreement. To quote the language here, "a projection of the general terms of agreement stipulated by the country in which the route is located with respect to United States involvement in construction and operation of such a canal." The Gravel amendment does not contain similar language. May we have here your opinion on the importance of the mandate, the legislative mandate, to compare terms of agreement between various countries ? Could we have your opinion? Colonel Sheffey. I think the objective is a very desirable one, and I think it cannot be attained. Colombia and Nicaragua are not go- ing to give you definitive terms for building and operating canals in their countries. It is going to take years of negotiation. When we went to Colombia— we 'did not do a lot of local work in Nicaragua — they informed us that they were happy to have us there making the study, because the information of the Choco Valley was valuable to them". The Atrato River sea-level canal route goes into the Choco Valley, which is an undevelo]:)ed area of the countrv. They cooperated with us in giving the right to put camps, do core drilling, supply our people, and so on. But they were emphntic in their admonition to us that the United States could not build a canal there automatically. They had negotiated with us once for a canal and lost Panama, and once Avas enough. 312 I think you can get a general feel for the current Governments" attitudes toward building canals in Nicaragua or Colombia, but it will be relatively meaningless for the long term. Only treaty agree- ment is really meaningful. Mr. MoDGLiN. One of the questions that has been a topic of dis- cussion at these hearings concerns the interest of other countries, other than the United States, in a sea-level canal for maritime conunerce. Based upon your experiences with the Atlantic-Pacific Commis- sion, could you relate to us what you feel the interest, the expressed interest of any other countries, whether it be Japan, or countries in Europe or elsewhere, may have been in a sea-level canal? Colonel Sheffey. Japan is the only country that we consulted that expressed a great interest in our building the canal. That is because Japan is the largest single user besides the United States. When we touched on construction money, the attitude generally was that it is a U.S. problem, and the United States is going to get it anyhow. Why should we Japanese get involved in this compli- cated i)roblem of relations with Panama I I think you find that still generally true. I do not think any country has sufficient interest in the canal to put money in it. First of all, the present canal is adequate for all countries but the United States, and reasonably adequate for us. Tlio demands on other countries' finances are just like the demands on ours. They do not want to spend their money somewhere else in the world if they do not have to. Mr. MoDGLiN. You make that statement, yet I recall the 1970 re- port has a good deal of discussion in it of multinational financing of a sea-level canal. Colonel Sheffey. We very much hoped for multinational ]5artici- pation, and the reception we got was pretty much as I described. Other countries think that it is Uncle Sam's problem, and we are going to take care of it anyhow, so why should they get involved. Mr. ]\IodCtLIX. Thank you. The projected vulnerability of a sea-level canal, or a lock-type canal, might be somewhat indicated by the marine insurance rate for vessels that traverse that waterway. I am just wondering, in the 1960's study, was there any consulta- tion witii, or any contribution by any marine insurance entities, and their opinions, on the operational hazards of a sea-level canal? Colonel Sheffey. No. Mr. MoDGLiN. Is there any particular difficulty associated — given the longer restricted channels of the sea-level canal — with nighttime operations there? Colonel Sheffey. No, the nighttime operations present no great problems. Once tlie canal is lighted, and you have the modern radar control devices, nicht or dav makes verv little difference. :Mr. :Modgetx. Why was a aoO-foot, or 600-foot channel, why Avas that particular dimension selected as a dimension for a sea-level canal ? Colonel Sheffey. Our model basin studios with models of the big tankers indicated that a canal width that is a minimum multiple of the beam of the design ship, the 250.000-ton ship, is necessary to 313 handle the ship safely in the canal. There is a phenomenon called bank suction. AVhen a large ship, a ship with a great cross section passes through the canal channel, the water pressure between the ship and the bank on either side varies with the distance from the bank, and you have to be about li/o to 2 times the beam away from tlie bank for this bank suction not to take place. What causes accidents in the present canal, and would be a greater problem in the sea-level canal, is when a huge ship gets off center, the water pressure between the shi]) hull and the bank tend to push it toward the near bank. This is an effect which scientists can explain to you. I am not sure that I can. Big ships are hard to handle, because if they get close to the bank, the bank tends to pull them into it. That is why huge tankers have to have bowthrusters, or very powerful tugs on the bow, and also on the stern, because at slow speeds the controls of the ship itself just do not work. A big tanker, a 800,000-ton tanker, going at 10 knots in the open sea takes about 5 miles to bring to a half. Nobody knows where it is going to go in those 5 miles, because once the engines are thrown in reverse there is no control whatever on the ship. A ship steaming at 7 or 8 knots straight down the center of the canal is fairly safe. But if it has to change direction, or slow down or speed up, the control problems become quite enormous, and these problems have not been solved. Mr. MoDGLiN. Why was a larger channel width not acceptable? Was it because of the money needed to excavate? Colonel Shefff.y. The cost of the sea-level canal in 1970 was esti- mated to go up $100 million for every foot of depth. Every foot of additional depth requires side excavation also. The 550-foot channel is the minimum channel for the 250,000-ton ship. The 550-foot chan- nel is the minimum channel that that ship can safely go through, and it provides two-way travel for smaller ships. Mr. MoDGLiN. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you very much. Now, we will hear from Mr. Nonnenmacher. Mr. NoxxENMAciiER. Mr. Sheffey, I would like to continue witli that last question of Mr. Modglin. Did you mean to say that you estimated it be another $100 million per additional foot of depth, or did you mean width ? Colonel Sheffey. Well, a deeper canal automatically has to be wider. The slopes of its banks are a function of how deep the canal is, and if you deepen it, then you have to widen it, too. If you are going to have the same width" at the bottom of the canal, it is an upside-down trapezoid, and as you deepen it you have to have clearance at the bottom. Mr. Nonnenmacher. Would vou repeat that rough formula you gave us to take care of bank suction? Did you say a ship would have to be li/> to 2 times its beam away from the bank to escape the effect? Colonel Sheffey. I have forgotten the multiple, but the canal would have to be at least three times as wide as the ship's beam to be safe. I will have to verify that figure. I do not remember if it was three, or some figure close to that, but I can research it vorv quickly and give it to you. [The following was received for the record :] 314 Criteria fob Channel Customarily, channel widths are designed in accordance with empirically- derived criteria expressed in terms of the maximum beam of transiting ships and the desired traffic pattern.s. Under these criteria, channel bottom widths vary be- tween about 3 beams for a canal carrying one-way traffic to 7.0 beams for 2 lanes of traffic traveling simultaneously in opposite directions. Channel depths often are designed at 110 percent of maximum ship draft. Mr. NoNNENMACHER. Are there otlier effects beyond bank suction in this transiting of large ships in a narrow channel? Colonel Sheffey. Oh, yes. Mr. Nonnenmaciier. Could you address yourself to some of these points? Colonel Sheffey. There is reaction between the bottom of the canal and the bottom of the ship. If the ship throws on power, why it tends to squat. The rear end drops down with the application of power. So this limits how you can use your power as you go through the canal, depending on how much clearance you have at the bottom. The bottom has to be far enough below the props of the ship that there is considerable clearance. The passing of ships, two-way traffic in the canal, introduces the same problem as bank suction. The ships suck toward each other if they pass too close. So there is a beam limitation for two-wav traffic in a canal of fixed width. If you design your canal to have 100-foot- beam ships pass each other, they need at least 100 feet between each other and 100 feet between the outer sides of the ships and the banks. That is why Ave chose two separate channels. Two separate channels are much safer than a one-way wider channel. Mr. NoNNENMACTiER. In the time that it would take to build the canal, were you considering just the single lane? Colonel Sheffey. The initial canal would be one lane wide, and operated on convoy basis, one way north, and one way south alternately. Mr. NoNNENMACHER. How loug would it take to build that? Colonel Sheffey. That would take roughly 5 years for planning and mobilization, and 10 years for construction. Mr. NoNNENisrACiiER. How much longer would it take to build a second bypass channel? Colonel Sheffey. That does not matter. It could be built inde- pendently. Mr. NoNNENMACHER. It docs matter in the view of the ships passing each other. How many ships you could put through in a day ? Colonel Sheffey. There would be no necessity to have a two-way canal initially. It would be uneconomic to invest the money until you need the greater capacity. The concept was to have a fully oper- ational, one-way canal while you are building your second canal at some future tirne. It would not be needed until the turn of the cen- tury, or well beyond. Mr. NoNNENMACHER. In view of that, could you tell us asain, in your own simple words, what is the need for a sea-level canal now? Colonel Sheffey. Well, we found in 1970 that the traffic projec- tions did not justify recommending earlv construction. We found a very strong case for building the canal for its military invulner- ability. The sea-level canal is relatively indestructible. A lock canal 315 can actually be destroyed. It can be put out of operation for 2 years or longer fairly easily by an attack that drained Gatun Lake. A sea-level canal can be blocked, of course, by bomb-induced slides, but the experience of the Suez shows that it can be cleared very quickly once a decision is made to clear it. So the military at- traction was to be able to pass our big aircraft carriers and the reliability of it in emergency. Whatever happened to it in war, it could be quickly resored to operation, where the lock canal could not. Also, at that time, w^e envisaged the construction of a sea-level canal as being so appealing to Panama that it would facilitate our continued operation of a canal on the Isthmus. We thought that Panama, in return for the huge investment in Panama, would give us the right to build and control a sea-level canal for a longer period than we could continue to control the lock canal. The economic case for it, as you see in our report, was marginal; the political and military cases for it were quite good. Mr. NoNNENMACHER. Now, in the testimony you gave us here, you mention the need for bowthrusters and tugs, and the like. You indi- cate a need for these to be developed. I see nothing in the studies, however, calling for development of such bowthrusters and tugs, of the types and power that you say will be needed. Colonel Sheffey. You will find the discussion of that in the engi- neering appendices to the study. It was not gone into in detail because the technology is known. The equipment has not been devel- oped to a great extent. Mr. NoNNENMACKER. How much would this cost? Can it still be done within the $8 million that Senator Gravel is asking for? Colonel Sheffey. No. there is no need for it. We know it can be done. There is no need to spend any money on it. If the time comes that the canal is built, the shipbuilders Avill build their canal and ships to use the canal. The technology is not new technology, it is a matter of developing known technology. It could be that better controlling devices on ships will be devel- oped, as well as other means for controlling big ships. The key thing is that knowledge of navigating canals with superships is very limited. The Suez is Jbeginning to be used for superships. The Suez has no current, and the banks and bottom are soft sand. A shipowner can take a risk in the Suez that he will run aground, or run against the bank, and the damage to his ship will be acceptable. Mr. NoNNENMACTTER. We are runnina: out of time. Three specific studies were mentioned in the conclusion of the rec- ommendation of the 1970 Commission. Can they be done, studies relating namely to (a) subsurface geology; (h) slope stability; and (c) hydroynamics of ships moving through confined waters in variable currents? Can those three studies be adequately completed within the $8 million figure? Colonel Sheffey. No, they were not even considered within that figure. Mr. NoNNENMACHER. In other words, we cannot go ahead without a much higher cost? Colonel Sheffey. I believe I said earlier in my testimony that you can do the study with $3 million total : you can get an adequate 32-461 O - 78 - 21 316 study to make a basic decision of whether we want to build a sea- level canal or not. The information that you are talking about would be needed in the design stages, after you have made the decision to build it. Mr. NoNNENMAGHER. You do not think there is any chance that after you started building it you would find that this subsurface geology was so poor that you could not build it, even though you had made the decision to do so? Colonel Sheffey. We already know that the geology is miserable. Mr. Nonnenmacher. Would you take part in a decision to build a sea-level canal without having made a complete study, as you recommended ? Colonel Sheffey. Sure. We know we can solve the problems. There are not any unsolvable problems that could develop. Slope stability is merely a matter of excavation. Mr. Nonnenmacher. You would start widening it from the beginning if it was subjected to a number of slides? Colonel Sheffey. This is what has been done in the present canal continuously since it was built. Slides have been almost continuous since the canal was built. Some portions of its banks are sliding right now. The economics of working on the slides as they develop are far better than trying to prevent them in advance, because some banks will slide and some will not. Mr. Nonnenmacher. That may be true, but it seems to me that you are telling us that the ditch is always going to be widened be- yond the initial 550 feet, and therefore it is going to cost a heck of a lot more than anybody is estimating. Colonel Sheffey. I do not understand. Mr. Nonnenmacher. You are projecting a 500-foot- wide new ditch, at the outset, only 50 feet wider than the Gaillard Cut, and yet you just stated that the geology is miserable there, and you fur- ther just stated that the only way to overcome it is by continuous excavation. Colonel Sheffey. That is correct. Mr. Nonnenmacher. Therefore, it seems to me you are not limit- ing it to 550 feet. From the beginning, you know from the geology that because of slides it is going to be widened back more than 550 feet, even after you have reached the 550 feet width that you set as a goal. Colonel Sheffey. I do not think that follows at all, sir. You de- sign a canal that you want to maintain at 550 feet. Our study took average conditions along each route, designed slopes that would be stable under those conditions, designed a canal, and estimated its cost on that basis. We know that there will be exceptions from the average conditions from time to time. We know that the slides can be accommodated after construction is initiated: after it is complete. The idea is to keep excavating as slides occur to maintain the basic 500-foot channel. Now, you can design any canal you Avant. We picked this one for cost estimates, because it appeared to meet the average supership requirements. Nobodv would go to a canal for a 700,000-ton ship, because there probably would not be half a dozen in the world. 317 Mr. NoNNENMACHER. But excavatiiig tlie slides you expect has to raise costs beyond those basic estimates. Let me ask you this. Is the point that I missed, perhaps, the fact that you would design a canal that would keep evolving into a 550-foot ditch? That your initial width would be, say, 300 feet, but you know Avith slides you'd widen it eventually to 550 feet? Colonel SiiEFFEY. I am at a loss to understand your problem. We designed a canal that we think will be stable with specific excava- tion slopes along its banks to maintain a 550-foot width. We know that we cannot rely on that 100 i^ercent. But we know that our ex- cavation plan gives a high measure of reliability. Engineering the perfect canal would cost far too much. Instead you engineer an acceptable canal, and the accej^table canal for the design ship that we calculated had a slope that probably would not slide. Some slides are certain to occur, because the ultimate angle of repose of some material is zero. Fortunately, there is very little of that on route 10. Mr. NoNNENMACiiER. Unfortunately, the chairman has to leave, so I am only going to ask one more question, although I will probably submit a number to you in writing. You have brought us, as usual, with your testimony, some very cogent facts, and you are the first, to my knowledge, who has pointed out that in ship ballast there is actually a continuing change of Atlantic and Pacific water. I would like you to expand on that, because it seems that you may have almost proven that the environmentalist's worry is in excess. I am not convinced it is, but if this has been going on for all these years, then quite a few tons of seawater has changed sides of the isthmus. Would you expand on that a little bit? Colonel Sheffey. This is the problem that I dealt with in the Commission, to my complete frustration, because many environ- mentalists like to maintain the illusion that the oceans are sealed off from each other. As I have already mentioned, there are "transfers" on the hulls of ships — the barnacles and moss take in countless organisms. Mr. NoNNENMACiiER. That is minute. Colonel Stieffey. I am trying to summarize how these transits take place. The handling of empty ships in the locks is a very tricky business. It is windy in that area, and a ship riding liigh in the water is easily moved against the lock wall by tlie wind. The canal com- pany requires ships in ballast to take on enough ballast water before they enter the canal that they are safer to handle. This water, of course, is taken on at the depth of the ship. If the ship's draft is 30 feet, why the ballast water, of course, has to be taken on in the top 30 feet of the ocean, which limits what goes in the ballast tanks. That would be the floating and swimming crea- tures that are caught in this water. Mr. NONNENMACIIER. But glvc US an average figure of how many tons of water, or gallons that might bo. Colonel Sheffey. Over 70 years it has l>een hundreds of millions of tons. I have no idea. The average ship, the tonnage capacity, let us say, is 50.000 tons, would probably haA'C to take on 10.000 tons of water, something like that. I am not sure. I would liavo to verify 318 this. But it is enough to get it down where it is really manageable in the water. Mr. NoNNENMACHER. Are there any filters that would keep out fish and sea life ? Colonel Sheffey. No, except for great big things. The filters on the intakes are quite big grids, because the water has to go in very quickly, and out very quickly. The ship goes through the canal in 12 to 24 hours. Because it is expensive to propel a ship with a load on it, as soon as they leave the canal they dump the ballast water so they are high in the water, and minimum fuel is required to propel them. In both directions this ballast water has been picked up in one ocean and dumped in the other now for 60 years. Bear in mind it is only the top 30, 40 feet of the ocean that is drawn upon to get this ballast water, so there are countless or- ganisms at lower levels that are not picked up witli it. Large crea- tures that are not picked up with it; but many of the ocean crea- tures have floating eggs and spawn, and in some stage in their lives, can bo picked up in ballast water. A very larcfe percentage of the two oceans' populations have been transported this way. Mr. NoxxEXMACiiER. Thank you very much, Co']. Sheffey. Mr. Metcalfe. Thank you, Mr. Nonnenmacher. Mr. Tannenbaum, do you have some questions? Mr. Tannenbaum, We have a limited amount of time. I always enjoy talking with you, and value the assistance that you have given us. Unfortunately, the outstanding fact is that we do not have much time now. I gather what you are really saying is that any cost estimates are guestimates ? Colonel Sheffey. Exactly. Mr. Tannenbaum. And you are also saying that Colonel Sheffey. They are educated guesses, but none are reliable ovpi- the lone" term. Mr. Tannenbaum. Yes, sir. And that the likelihood of — the only feasibility for a sea-level canal would be if there were continued U.S. presence in Panama beyond the year 2000? Colonel Sheffey. I would not say that. I think the canal would be enormously valuable to us now. I think the financing is going to be very difficult, if there is not some U.S. influence to protect that financing. Mr. Tannenbaum. Right. So that is feasibility versus prac- ticality? Colonel Sheffey. Yes. Mr. Tannenbaum. And you favor Congressman Murphy's legis- lation, because you think that it is foolish to spend a lot of money on updating the study until you feel it can result in a more practical future determination ? Colonel Sheffey. Yes, Mr. Tannenbaum. I tried to emphasize several times that things should proceed step by step, and money for the second step should not proceed unless the first step shows that the second step is necessary, and then the third step is undertaken if the second step shows it is necessary. I think the Murphy bill does 319 just that. I think the amount of money involved to give a good, educated estimate of cost and revenue is quite reasonable and well worthwhile. Mr. Tannenbaum. The ai:)proach, of course, is an updating of an existing study, rather than to look at the subject de novo. Do you think that makes sense? Colonel Spieffey. Well, the isthmus has been studied for 300 years, and our study was an updating, in effect, of the 47 studies. They all were built on the past, and there is not a lot of new knowl- edge to be acquired. The new things are economic and political, not technical, and I think that a review of the routes, for example, will clearly show that Panama is the only place to build a canal. You can look at the map and see. The Colombian route is 100 miles long. The Nicaraguan route is 140 miles long. The excavation requirements are astro- nomical. The cost, I would hesitate to guess. I have said $20 billion, rela- tive to Panama, but those are low figures. So you would have very little trouble in narrowing the selection down to Panama. The map itself tells you that, and the argument about the Nicaraguan route saving steaming time at sea is a fallacious argument. The time saved at sea would be lost in the canal. It would take 30 or 40 hours for a ship to go through. That same time spent at sea reaching Panama for a 40-mile canal would be better spent, because the 40-mile canal is much safer. There are going to be high accident rates in a sea-level canal. There is already a significant accident rate in the present canal. The minimum length canal is very desirable. Because of the mini- mum length, there will be the minimum accidents and the minimum costs of handling ships in the canal. So I think it would be very easy for any new group to analyze the data and come to the conclusion that the Panamanian routes are the best ones. Now, there are three very good Panamanian routes, and the rea- son route 10 was chosen is that the other two interfere with the present canal. We felt it very undesirable to interfere with it in construction, and destroy it in the end. The route through the present canal requires the drainage of the present lake when the sea-level canal is opened. Route 10 permits the permanent retention of the other canal and Lake Gatun, which is a highly desirable end. I think that pretty well covers it. Mr. Tannenbaum. One quick point, which will take only a couple of minutes. The cost estimate of $8 billion seems rather large in relation to a study that was completed just 8 years ago. Could you just elaborate on that? I do not think inflationary fac- tors are sufficient for such an increase, and do we not have some improved technology that might offset some of these inflationary factors ? Colonel Sheffey. That is just a rough estimate based upon my knowledge that the 1970 studies were very conservative. That is the 320 cost estimates that then were minimum cost estimates, and multiply- ing it by the increased cost of doing business in Panama, and earth- moving, and that sort of thing, I arrived at a figure of $6 to $8 bil- lion. I think any engineer with experience in these long-term projects will tell you that even that is probably low. General Vogel and I were just discussing it, and he is an ex- perienced engineer, he is a better man than I, to tell you that $8 l3illion is a low cost. Almost all engineering projects turn out to cost more than the estimates. Mr. Tannenbaum. Does the $8 billion include cost of interest Colonel Sheffey. No, the $8 billion is the capital outlay, and the interest accumulation would have to be added to that. Mr. Tannenbaum. You are talking about $4 billion or $5 billion more? Colonel Sheffey. At least $4 billion more. Mr. Tannenbaum. Thank you very much. Mr. Metcalfe. Thank you very much, Mr. Tannenbaum, and Colonel Sheffey. We would like to express our thanks to you for your fine testimony. The Subcommittee on Panama will now stand in recess until 2:30 p.m. Thank you. [The following was received for the record:] National Association for Uniformed Services, Arlington, Va., July 17, 1978. Mr. Nicholas T. Nonnenmacher, Professional Staff, Minority, Stibcotntnittee on Panama Canal, Committee on Merchant Marine and Fisheries, U.S. House of Representatives, Washing- ton, D.C. Dear Mr. Nonnenmacher: Enclosed are my answers to the first questions you sent me. I do not believe commenting at length on Capt. DuVal's 31-year old report is worth my time or yours. He is comparing his third locks plan with an in- zone sea-level canal that would require destruction of the existing canal and drainage of Gatun Lake. The Commission recommended an entirely different sea-level canal outside the Zone with minimum curvature, greater width and depth, and tidal controls to reduce transit hazards. This different canal either eliminated or greatly reduced the 13 sea-level canal disadvantages and 20 lock canal advantages cited by DuVal, and added very significant new advantages for the sea-level canal. All of this is covered in the Commission Report. The Commis.^ilon weighed all the pros and cons cited by DuVal and made the recommendation that no third locks be built whether or not a sea-level canal is built. In brief, the third locks cannot even remotely be justified on economic, military or political grounds. While the sea-level canal probably cannot be justified economically, it does have great military advantages over any lock canal and significant political advantages. The latter are : Accommodation of practically all the world's shipping for the foreseeable future. Easier defense (on-site U.S. forces not essential). Less complicated operation and maintenance than a lock canal, facilitating host country operation. Sincerely, John P. Sheffey, Executive Vice President. Enclosure. Questions of Mr. Nonnenmacher and Answers Supplied by Colonel Sheffey Question 1. Please submit all of the reasons, including political ones, that Route 10 was decided upon as tlie most practical sea-level route. Answer, a. The cost of the longer canals outside Panama (40 miles) in I 321 Nicaragua (140 miles) and Colombia (100 miles) would be 2 to 4 times as great. Even the sliortest canal in Panama probably could not be amortized from revenues. b. The long winding canals in Nicaragua and Colombia would be far more time-consuming and dangerous for transit by large ships than the short, rela- tively straight canal in Panama. c. The Nicaraguan sea-level canal would be an engineering monstrosity unless Lake Nicaragua were drained, and the area is very earthciuake pron- d. It would be economically ridiculous to attempt to operate another canal in competition with the Panama Canal. 9o% of the world's ships projected for the year 12000 could still pass through the present canal. Price competition between the two could easily give Panama most of the potential tolls. e. Neither Colombia nor Nicaragua is likely to agree to a canal on their territory that would destroy Panama economically. f. The U.S. eventually will have problems with any country in which the canal is built. Problems with Panama (1.5 million people and no significant armed forces) would be far more manageable than problems with Colombia (45 million people and strong armed forces). g. U.S. problems with Panama over the canal since 1903 have been rela- tively small, and canal operations have never been interrupted in spite of the sound and fury at times. Building a financially unsound, teclinically unsatis- factory canal elsewhere because of Panamanian nationalism would be jumping from the frying pan into the fire. Colombians and Nicaraguans would be equally nationalistic in the long run. h. Latin America would not by sympathetic with a U.S. sponsored canal in Colombia or Nicaragua that would be destructive to Panama. Political prob- lems or even military problems could result : i.e., guerrilla attacks on con- struction forces and retaliatory interruption of the present canal during the 15-year construction period of the new canal. Question 2. Cite the specific disadvantages of Route 10 as compared to each or any of the alternative possible routes. You mentioned that it would take five years or so to reach agreement with Panama for a new treaty by which we could build a sea-level canal. Please explain what would be in- volved. Answer. The only disadvantage of Route 10 is that it is outside the Canal Zone and would require acquisition of new land areas for construction. The advantages are many. The most significant are: Construction can be accomplished without interference with the operation of the existing canal or its destruction when the new canal is opened. The two in-zone routes require construction operations on the route of the present canal and its permanent elimination (including drainage of Gatun Lake) when the sea-level canal opens. It is shorter than any remote route in Panama, Nicaragua, or Colombia. It is close to the existing canal infrastructure and defenses, and requires little investment in construction support facilities or new operating and defense facilities. It would lend itself to operation in conjunction with the existing canal if additional or emergency canal capacity is needed. Question 3. In 1970. the Sea-Level Study Commission stated on page 9, under the heading National Seeurity: "Panama has neither sufficient military strength to defend the Panama Canal nor the capability of developing such strength. The presence of U.S. forces is essential for the security of the canal." Would there be any logic in building a sea-level canal in Panama or any place else if the U.S. were not permitted to defend it with on-site mili- tary forces? Answer : The U.S. needs a canal for its national defense. Only U.S. forces can be relied upon to defend the canal in all circumstances. A sea-level canal is far less vulnerable to long-term interruption than a lock canal. It can be blocked, but it cannot be destroyed as can a lock canal. On-site I^.S. defense forces are more likely to be able to prevent interruptions than off-shore forces that must be transported to the area. My personal view is that the U.S. should not invest in a new canal unless it obtains enforceable guarantees of sound financial management that would offer some hope of recovery of the U.S. investment and U.S. on-site defense riglits. However, the ILS. could far more safely risk the security of a sea-level canal to host country defense than the security of a lock canal. 322 Question 4. Senator Gravel testified, that the problem of steering ships in restricted channels affected by tidal currents would not be difficult to solve. Do you agree? You mentioned the need for bowthrusters. Would they alone solve the problems, however? Answer. Bowthrusters and powerful tugboats will be needed. Few, if any, present-day superships have bowthrusters. The technology and equipment for handling ships in a sea-level Isthmian canal will be developed as experience with the problems is gained. There are no insurmountable problems — the unknown is cost. Question 5. You stated that it would cost $100 million for each additional foot of depth in constructing a sea-level canal. In view of the poor geological conditions in Panama, please make an estimate of the annual dredging cost to maintain the projected canal at the proposed depth and width. Answer. The requested estmate is beyond my capability, and it is probably impossible to make a reliable estimate. The excavation slopes used in the 1970 estimate were designed to be stable under average geological conditions in the area, based upon core drilling along the canal route and 75 years of experience with the nearby existing canal. It would be vastly more expensive to excavate to absolutely reliable slope stability than to accept a number of slides and clean them out after they occur. The operating and maintenance cost estimates for the various canals reported in the 1970 study report in- cluded estimated dredging costs to maintain the design channels. For Route 10 the total operating and maintenance costs for 35,000 transits a year was estimated in 1970 to be $57,000,000/year. Question 6. You mention that it takes some five miles to halt a 300,000 dwt. tanker at sea traveling at 16 knots. You said one would be safe enough at 7 or 8 knots down a canal straightaway unless it had to change direction or slow down or stop. At what speeds do you see supertankers transiting curves and bends in any new sea-level canal in view of their enormous momentum? Answer. 4 to 5 knots in relation to the water (add or subtract current si)eeds for speed in relation to banks). With tidal gates limiting canal currents to a maximum of 2 knots, speeds in relation to canal banks would range from 6 to 7 knots. All large ships would have to be accompanied by tugs for safety. Question 7. In your testimony, you stated : "Almost every factor that must be considered in the financial analysis is unpredictable over the long term." Then you mentioned many such factors and concluded : ". . . Any one of these variables could render a sea-level canal financially unfeasible." Would you please cite which, if any, factors are likely, at any time, to render a sea-level canal financially feasible? Answer. I repeat : Any of the factors could change unexpectedly so much as to render a sea -level canal financially infeasible. The most likely varia- tions from projections are construction costs and canal revenues. Question 8. You failed to answer my question : "How many ships could you put through the sea-level canal in a day?" Please answer this regarding traffic in each direction in the initial single lane canal. I am especially inter- ested in the number of vessels that would be transited during the high tides. Would this tidal transiting in any way resemble surf boarding on the crest of a wave? Answer. Canal capacity is a very complicated question that cannot be answered simply. It is a function of mix of ships in size and handling char- acteristics, the number and capacities of available tugs, the tides, and the design, location, and operating characteristics of the tidal gates, and many other factors. The initial one-way canal recommended by the Commission had an estimated annual capacity of 34,000 transits of a projected average ship mix. The tidal gates would limit currents to a maximum of 2 knots. There would be no surf-like waves in the canal. See Chapter 8, Annex V, of the 1970 Report for a detailed discussion. Question 9. In answer to my question as to what is the need for a sea- level canal now, you said : "Also, at that time, we envisaged the construction of a sea-level canal as being so appealing to Panama that it Avould facilitate our continued operation of a canal on the Isthmus. We thought that Panama, in return for the huge investment in Panama, would give us the right to build and control a sea-level canal for a longer period than we could continue to control the lock canal. The economic case for it, as you see in our report, was marginal ; the political and military cases for it were quite good." Am I correct in assuming from this that a major reason for the sea-level canal I 323 proposal was simply a gimmick to enable us to maintain a U.S. presence in the Canal Zone because our policy makers had lost the determination to hold onto the existing canal? Answer. My quote is entirely self-explanatory, and the term "gimmick" does not merit a response. President Johnson announced on December 18, 1964 that the U.S. would eventually turn over the present canal to Panama. He made that decision for the same reasons that the Senate has now ratified the new Panama treaties. He also was advised that a sea-level canal was probably feasible and could facilitate longer U.S. tenure of a canal and reduce the military risk of our ultimate departure from the Isthmus. Question 10. In my questioning of you regarding the matter of continued excavation of the sea-level canal because of the expected slides, it appears that each of us was concentrating upon a different point. Your attention was centered on the design and mine on additional costs. Assuming you excavate a channel initially 550' wide at the base and with a certain slope angle, is it not true that, because of recurring slides due to poor geological stability, those .slopes will have to be continually cut back in addition to removal of the slide material in the bottom of the ditch to regain the 550' width? Is it not true that the enormous excavation involved in the cutting back of the banks would involve costs beyond tho.se included in your original basic cost estimates for the canal. Answer. See answers to Question 5. Question 11. More soil has been excavated from the existing canal since its completion than during its original construction. Might not the same be expected of the proposed sea-level canal because of the geology which you describe as "miserable?" If so, could we not expect the actual cost of the sea- level canal to be at least double any figure that might be contemplated, in- cluding the inflation factor? Answer. I have already testified to my conviction that reliable cost esti- mates are not possible. A reasonably reliable estimate can be made of today's costs for a specific channel design that would have no more than an economi- cally acceptable amount of slide-s. However, the initial design will inevitably change as construction progresses, and construction costs will change un- predictably during the 15 or more years of construction. Other costs will also change. At this time, no one knows what the land acquisition costs will be for the canal route, or what payments will be demanded by the host country. [Whereupon, at 12:57 p.m., the subcommittee recessed, to recon- vene at 2:30 p.m., the same day.] AFTERNOON SESSION Mr. Metcalfe. The Subcommittee on Panama will come to order. I now recognize the distinguished chairman of the full committee, Mr. Murphy. Mr. Murphy. I thank the chairman. The acquisition of the U.S. Canal Zone Territory in 1904 and the construction of the Panama Canal, 1904—14, form a highly im- portant chapter in American history. Our next witness today has had an extensive naval career, including service in the Canal Zone during the canal's most crucial period, 1941-44, when he was in charge of marine operations in the Pacific half of the canal. As the author of two authoritative books, (1) "Cadiz to Cathay: The Story of the T^ng Diplomatic Struggle for the Panama Canal"; and (2) "And the Mountains Will Move: The Story of the Building of the Panama Canal," as well as contributor to the Encyclopedia Britannica, and professional magazines on canal history and prob- lems, he combines the qualifications of the experienced navigator, a peace and war canal operating official, and scholar. As a former Secretary of the Navy Department Shore Station Development Board, it was only natural that he should have 324 evolved, while in the Panama Canal organization, what proved to be the first comprehensive proposal for the future canal derived from marine experience known as the Terminal Lake-Third Locks plan. This proposal was submitted to higher authorities and finally to President Franklin D. Roosevelt, who expressed his approval of it as a postwar project. Today is not the first time that our witness has given testimony before this committee. On March 14, 1947, on invitation of Secretary of the Navy, James Forrestal, the entire committee visited the Navy Department and heard an extensive presentation by Captain Duval. Today he does not give his statement as an engineer but solely as a former canal operating official and historian. Captain Duval is accompanied by retired Brig. Gen. Herbert D. Vogel. General Vogel has been Lieutenant Governor of the Canal Zone. Today he heads Herbert D. Vogel Associates here in Washington. I understand Captain Duval, has described in his prepared state- ment certain features in the formulation of our Isthmian Canal policy with special reference to the third locks project and the development during World War II of the Terminal Lake-Third Locks solution for the future Panama Canal. This is an important statement which all of us should study. In the interest of time, how- ever, I am told that the captain will allow his statement to be in- serted for our hearing record. [The statement can be found on p. 391.] Mr. Metcalfe. I ask unanimous consent also that the statements of Capt. Miles P. Duval and Brig. Gen. Herbert D. Vogel, U.S. Army, retired, be entered into the record. And I further ask unanimous consent that questions be submitted to both of these witnesses in the future, and they be asked to respond to them. Our next witness is Mr. Leonard J. Kujawa, an accountant with the firm of Arthur Andersen & Co. Mr. Kujawa has testified before this subcommittee on numerous occasions, and has delivered superb testimony on every occasion. His opinions on Panama Canal financial matters are accepted by the Congress, the executive branch, and the public. In addition to his work for the Panama Canal Co., Mr. Kujawa was one of the economic consultants for the Atlantic-Pacific Com- mission in the 1960's. I am happy to welcome you back, Mr. Kujawa, and we look forward to your testimony. STATEMENT OF LEONARD J. KUJAWA, PARTNER, ARTHUR ANDERSEN & CO. Mr. Kujawa. Thank you, Mr. Chairman. It was a pleasure to accept your invitation to again testify before this subcommittee. As you know, I have testified on many occasions regarding various financial and accounting issues based on my firm's long association with the Panama Canal Company. The subject of my testimony today, as directed by you, is the sea- level canal and the possible need to update the 1970 study made by the Atlantic-Pacific Interoceanic Canal Study Commission. I see 325 value in not only updating that study with strong emphasis on the financial dimension but also evaluating the full range of alternatives to the construction of a sea-level canal. A CHANGED WORLD FROM 19 70 In preparation for this testimony I reviewed the 1970 report of the Commission. I did so from a personal perspective because I was involved in certain financial aspects of that study. As I read that study and the assumptions underlying it, I was impressed by how much the world has changed since the study was made. The follow- ing is a listing of significant economic events that had not happened when the study was completed in 1970 : 1. THE OIL CRISIS OF 1973 This is, unfortunately, the greatest economic event, with profound implications. 2. CONSTRUCTION OF THE ALASKAN PIPE LINE The importance of Alaskan oil to the U.S. economy in today's terms was unknown in 1970. This planning for the construction of the pipeline was proceeding at a relatively leisurely pace. 3. THE DEGREE OF CONCERN FOR AN IMBALANCE OF TRADE WITH JAPAN Although trade with Japan had grown rapidly since the Second World War, there was no great concern within the U.S. Government regarding future growth. This growth of Japan-United States trade was a prime mover for canal traffic growth. 4. THE RECENTLY ADOPTED TREATY WITH THE REPUBLIC OF PANAMA In 1970 there was no significant dialogue occurring between the United States and the Republic of Panama on a new treaty. 5. A SUSTAINED HIGH RATE OF INFLATION IN THE UNITED STATES The setting for the 1970 study was the price stability of the 1960's. 6. CESSATION OF THE VIETNAM WAR The traffic of the Panama Canal, in terms of number of transits, was cresting at an alltime high in 1970 influenced, in part, by the U.S. involvement in the Vietnam war. 7. THE REOPENING OF THE SUEZ CANAL The Panama Canal was enjoying additional traffic because the Suez Canal remained closed for an unknown duration. 8. THE ADVENT OF SUPER COXTAIXERSIIIP TRAFFIC FOR THE PANAMA CANAL Although there were modified ships that carried containers, the general cargo ship of 1970 was still a relatively small ship. It wasn't until 1972 that the first containership transited the Panama Canal 326 with dimensions that taxed the capacity of the locks to accommodate this new ship type. 9. MTJLTIYEAR TRAFFIC DECLINES FOR THE PANAMA CANAL The Panama Canal had enjoyed almost a continuous climb in traffic growth since World War II. The traffic decline which began in 1974 was unprecedented. 10. THE PANAMA CANAL COMPANY FINANCIAL LOSSES Financial adversity was unknown to the company but successive losses in 1973, 1974, and 1975 raised questions regarding the long- term financial viability of the company. 11. PANAMA CANAL TOLL RATE INCREASES In the study there were various assumptions regarding the capac- ity of the Panama Canal to raise tolls but these were strictly theoret- ical since a toll rate increase had never occurred. The cumulative effect of all these changes is so profound that the foundation for the 1970 study has been weakened significantly in the financial sense. There is no way in which the developers of the 1970 study could have anticipated such changes when they reached their conclusions. THE NEED TO PLAN AHEAD There is a need for the management and users of the Panama Canal to plan ahead. The nature of the facilities of both the user and owner is an investment in plant and equipment whose lives ex- tend over multiple decades. This places a premium on long-range planning so that capital resources are properly acquired and effi- ciently utilized. As a result of the recently ratified treaties between the United States and the Republic of Panama there is established a new Panama Canal Commission. This Commission will be charged with the efficient operation and maintenance of the Panama Canal. An important part of the Commission's management responsibility will be planning for the replacement and improvement of the facili- ties which comprise the existing Panama Canal. The most important decisions concern widening and deepening the channel and water supply. In order for the Commission to do this effectively, it will be important for it to know future plans regarding its ultimate re- placement. To illustrate, if there is no plan to replace or sig- nificantly enhance the existing canal through such approaches as a third set of locks, then the Commission should enhance the existing facility to the maximum extent justifiable to accommodate and at- tract future traffic. Conversely, if there is a plan to replace it then the Commission should take steps to make do with existing facilities. The users of the Panama Canal are making significant long-range decisions based on the existing facility. These decisions include the conscious and rational acquisition of capital facilities to avoid the I 327 Panama Canal. This is apparent when a shipowner purchases a ship too large to transit the canal. Another such decision concerns Alaskan oil wliercin SOHIO is proceedino; to construct a pipeline from southern California to Texas as part of a system to transport the oil to Midwestern markets. Once such a decision is made, it has an irreversible effect for many decades, producing a potential misallocation of capital resources. If the United States intends to construct a new canal requiring enormous resources, then it should be known as far in advance as possible so that potential users of such a facility do not expend resources on the assumption that there will be no new canal. The premium placed on planning ahead is demonstrated by the magnitude of the dollars involved: Enhancement of the existing Panama Canal can involve expendi- tures in multiples of hundreds of millions of dollars. A new sea-level canal costs many billions of dollars. A SOHIO pipeline costs over $500 million. A single new containership costs between $50 and $100 million. WHAT IS THE MARKET FOR A NEW CANAL? I strongly urge that a revised canal feasibility study give major emphasis to the financial dimension. A canal serves a transportation market and the question of what type of canal to construct should be substantially influenced by the need for canal service repre- sented by the willingness of users to pay prices for the use of the facility that will justify the enormous capital expenditures in- volved. Before a new canal is designed in an engineering sense, the financial analysis needs to conclude as to the type of facility that will be most attractive to the user. The basic approach to the most valuable financial feasibility study would be comparable to a long-range development plan taking into consideration all alternatives, including a new facility. These alternatives would include not only a sea-level canal, but also modernization of the existing canal, construction of a third set of locks, and possibly other types of transportation facilities. As a result of comparing a full range of alternatives, it will be possible to select the most appropriate plan and then to take into account such noneconomic factors as potential political and social impact. A necessary but treacherous phase of the financial feasibility study is a forecast of potential future traffic. The Panama Canal Company has made many traffic forecasts over the years, the most recent of which was completed by an outside economist in January 1978. Although these traffic forecasts would be useful, they would require substantial expansion to make them revel ant because the level of traffic of the existing facility is controlled by the limitations of the facility and the current prices that are charged for its use. If the facility were substantially different, it can be expected that the use would be different. Accordingly, a significant input into a re- vised feasibility study should be a market survey of potential de- mand for canal service. The perils associated with predicting future traffic can be ^yell chronicled by comparing the 1970 study and the accompanying 328 traffic forecasts with subsequent events. That study included two traffic forecasts with the one relied on referred to as potential traffic and the second referred to as the low estimate. In hindsight, the potential forecast was unrealistically high and even the low forecast was higher than actual results. This is not to conclude that planning forecasts are unnecessary but demonstrates the underlying risks as- sociated with them. Significant and reliable analyses underlying a decision to build or enhance the present canal should, however, also include a compre- hensive study of comparable transportation economics. These anal- yses should consider all transportation modes that compete with the canal service, including ships too large to use the current canal, rail- roads, and pipelines. They should demonstrate the competitive ad- vantages and disadvantages of the various potential users of the canal identified in the market survey and should set forth the reve- nue potential of the canal assuming an appropriate pricing strategy. The above approach to determining the financial feasibility of a new canal allows conclusions to be made regarding the financial benefits flowing therefrom without making undue reliance on fore- casts of future traffic alone. Thus, although no one can be certain of the level of potential traffic in the year 2000, there can be confidence in the relative competitiveness of a new canal with other transporta- tion modes in the year 2000. This approach allows one to conclude as to whether the canal will be used if traffic develops. After having examined the absolute market for canal service and having determined alternative transportation costs, the next phase of the financial feasibility study should explore various pricing strategies to produce optimal revenue. Approaches could be de- veloped to permit potential use of canal service over the long term, limiting the risk involved in the investment in the canal as well as maximizing potential revenue. CAN THE APPARENT ECONOMICS HE OVERCOME? Although I agree that a revision of the 1970 study should proceed, I do not foresee the likelihood of such studies concluding that a new sea-level canal could be self-financing. It is likely that such a study will demonstrate that there is a price to be paid by the in- vestor in such a facility. The only question is how large that amount will be or whether another alternative is more economically attractive. It will be necessary to justify a sea-level canal on noneconomic factors or unquantified economic factors. A new canal facility would in all probability spur economic development not only in Panama but also in other locations in the Western Hemisphere. In addi- tion, a new canal capable of handling large ships could stimulate the development of new ports to accommodate these large ships. Also, ship construction may be stimulated, and ships that are currently being built based on the limitation of the current Panama Canal may be changed. To some extent, an investment in a canal can be viewed in a man- ner similar to the construction of bridges and higliways. The con- struction of highways encourages economic development not only 329 locally but in the nation where it is constructed. The canal is similar to a bridge as a part of a highway but in this case it is a bridge on one of the major sea highways of the world. A proper role for Government to assume is to undertake initial investments that stimulate economic development through a multiplier effect. Mr. Metcalfe. Thank you very much, Mr. Kujawa, for the very fine statement. I have a few questions that I would like to ask. In any sea-level canal study, how nmch funding ought to be allocated to the economic aspect of the question? Mr. KuJAWA. In the approach that I have suggested in my testi- mony, Mr. Chairman, which is a very broad approach studying not only a sea-level canal, but also other transportation alternatives, I foresee that to be properly done, it would be an extensive under- taking. I am only guessing at this point, but such a study could take up to, say two years, and require expenditures in the range of $1 to $2 million. Mr. Metcalfe. Like Senator Gravel, you have addressed the need for government sponsorship of a sea-level canal. If we envision a sea-level canal, backed by many countries, what about the possi- bilities of a multinational financing of a study? Mr. KujAWA. Ideally, the participation of more than the United States, including not only the host country — which is likely to be Panama — but also major users would be appropriate. I would encourage that such an approach be taken. Mr. Metcalfe. Do you think that they are likely to contribute financially, other nations, to the construction of a sea-level canal? Mr. Kujawa. That is extremely difficult to answer, Mr. Chairman. I really do not know. Mr. Metcalfe. Let us go on to the next question. You stated that potential users should know as far in advance as possible if the U. S. intends to construct a new canal. Will the 14 years necessary to build a sea-level canal be enough time? Mr. Kujawa. That is a long period of time, in economics. For the user to have, say, a 15- to 20-year advance notice, certainly would be very valuable. Mr. Metcalfe. Keep in mind, of course, your statement that you made earlier, with regards to the parameters that are listed here. And T think that is good reasoning on your behalf — that you are capable of doing, usually, in all of these things. My final question is: What is your recommendation as to the economic techniques and analysis that should be applied to an update of the 1970 study, in comparison with the analysis used by the Atlantic-Pacific Commission? Mr. Kujawa. I would expand the 1970 study, to include a sub- stantially greater amount of analysis and measurement of the market for and "cost of alternatives, to the use of the present Panama Canal. As T recall, the principal emphasis of the 1970 studv was placed on a decision to build or not to build a sea-level canal. I would recom- mend that that be expanded to include the relative economics of doing other things, say for example, the enhancement of the exist- injr canal. 830 If you do not build a new canal until the year 2000 or, even say, 1990, it may be necessary to spend many hundreds of millions of dollars maintaining and/or improving the existing canal to serve existing traffic. In this regard, there is a question in my mind as to whether that should be done, if construction of a new canal is planned. Mr. Metcalfe. Mr. Kujawa, if my memory serves me correctly, in your statement you really gave us a critique on the 1970 study. And we will use it. Now, I mean, there are a lot of things, a lot of things and recommendations that are made that are not germane to the issue, if it were written today. Am I correct in my analysis of your presentation ? Mr. Kujawa. Yes. Mr. Metcalfe. And do you also anticipate that any future study maybe likewise be subject to these same conditions, as different changes take place? Mr. Kujawa. You certainly have those risks, yes, Mr. Chairman. Mr. Metcalfe. Thank you. I have no further questions. Mr. Modglin? Mr. Modglin. Mr. Chairman, in the interest of time, just two items for the record. I wonder if Mr. Kujawa could provide for the committee, if he would like to, an explanation of why Government must sometimes take on projects stimulating economic growth. And I am referring particularly to the very end of your statement, when such projects would seem unattractive to the elements of the private sector. It is really an economic question. Mr. Kujawa. In this particular case, it appoars that the direct benefits flowing from a multibillion dollar decision to build a canal would probably not be sufficient in themselves to pay for the capital involved. There could however be significant indirect benefits. The question is whether those indirect benefits are enough to justify the invest- ment. Now, the only investment vehicle to finance such a project is Government. A private investor could not look to that source for a payback. He looks only to the direct benefits. If the direct benefits are not there, then the investment is usually not considered prudent. Mr. Modglin. Mr. Chairman, I have a couple other questions, if they could be inserted in the record. Mr. IMetcalfe. Without objection, they will be inserted into the record, and we will ask Mr. Kujawa to respond, thank you. Do you have any further questions ? Mr, Modglin. No. [The following was received for the record :] Questions of Mb. Modglin for Mr. Kujawa In elaboration of your point that economic analysis ought to be applied to a whole range of interoceanic transit alternatives, I believe the following data on merchant fleets of the world as of 1975 could demonstrate that the Third Locks alternative has many of the same attractive points as does a sea-level canal. 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Response of Leonard J. Kujawa to Question by Me. Modglin The facts you present are very relevant to the sea-level canal question. A study of the trade routes used by such ships would probably indicate that few, if any, call on U.S. ports. The use of U.S. ports is important in that two-thirds of all traffic using the Panama Canal either originate or terminate in a U.S. port. Thus, the ships beyond what could be accommodated by a set of third locks may well be ship sizes of no direct economic interest to the United States. I urge that if a Commission is set up to further study the sea-level canal question, it be given the responsibility to arrive at a set of recommendations looking ahead at least 25 years, regardless of whether a sea-level canal is recommended. Thus, if a Commission were to recommend that a sea-level canal not be built, it would have the responsibility of recommending a set of appropriate alternative actions which may be as complex an undertaking to develop as would the evaluation of the sea-level canal. He is speculating, in effect, that it may be there. Mr. Metcalfe. Mr. Nonnenmacher ? Mr. Nonnenmacher. Thank you, Mr. Chairman. Mr. Kujawa, have you studied Senator Gravel's testimony, and his figures, his economic projections of the Alaskan oil? And if you have, would you care to comment on the relative accuracy of those figures ? We have other estimates, such as those of the Canal Co. Mr, Constant testified that the industry has told the company that 400,000 barrels a day is what they could expect the average run through the canal to be, of the North Slope oil. Mr. Kujawa. I have not heard Senator Gravel's testimony. I have seen his written statement, and that has contributed to this subject. And as I recall, he has two levels of trafiic in it. One is based on known oil or proven reserves. It indicates a level of traffic, and then he suggests the possibility of much greater reserves in Alaska, mainly offshore, which may or may not be there. It remains to be seen. I think he has suggested that if it is there, then it would justify a sea-level canal. But I do not think that Senator Gravel is saying it is there. Mr. Nonnenmacher, Well, it raises the question in my mind as to some need for a geological — I do not want to say "study," because they probably had lots of studies, but a more accurate survey — to give us a projection on Alaskan oil, in connection with the study we are asked to consider making. It seems to me that this is one of the more important studies that should be updated if we are to update the sea-level canal study, namely, how definite are these reserves in Alaska? He does project figures — he speaks first of the west coast surplus of at least 500,000 barrels a day, by next spring, at which time the North Slope will be producing at the rate of 1,2 million barrels a day. Then he goes to say that on the second level, there is every likelihood that these figures, as large as they are, will at least double in the next several years. And. further, he says that recover- able reserves may be five tinies as larere as alreadv demonstrated reserves are — according to the projections by the U.S. Geological Survey. I 335 Would you feel that a complete U.S. Geological Survey, or a similar survey, should be part of this study regarding the value of the sea-level canal? Mr. KuJAWA. Well, obviously, if we knew how much oil was off- shore in Alaska, it would be valuable. But I think, sir, that the analyst could work around that, in the following manner. He would say: OK. If the oil is there, how should it be transported to market? Would a canal be the way to do it? Or would it be more economical for a pipeline to be used ? If he concluded that it is more economic for a pipeline to be used, well, then, whether it is there or not is irrelevant to the decision to build a new canal, because if oil does develop, it should move by pipeline, not by a sea-level canal. Mr. NoNNENMACHER. Would not another factor be the offshore unloading facilities for oil carried from Alaska, say, through a sea- level canal, to the east and gulf coast ports, where there are no deep-sea ports? Mr. KujAWA. That is a verj' relevant factor, because if you build a sea-level canal, your next problem is the Continental Shelf off the east coast of the United States. You have the opportimity of offshore mooring, such as is now developing particularly in the gulf off New Orleans. Such a development provides a solution to the oil problem. But of course offshore mooring is not a solution to the transport of solids such as coal or grains. Mr. NoNNENMACHER. The points I have in mind all pretty much revolve around my concern about a realistic actual cost of this projected study. It may well be that it cannot be done for even $8 million. The environmental study is aclaiowledged to be a very costly thing. I would like to ask you, under the subject of the need to plan ahead, do you agree with Colonel Sheffey whose testimony was that we do not really have to make the three studies, which the 1970 Commission — which he directed himself — recommended, namely, of the geological subsurface, the slope stability and the hydrodynamics of large ships in narrow channels. Would you, as an economic or financial adviser to an entity, either private or public — looking into such an undertaking — feel that you could overlook such studies and not include them, because the cost he said would put it way above the $8 million and because, as he told me privately, during the recess, these studies would only add about 10 percent more accuracy to the overall study, which he projected would be only 30 percent accurate to begin with. Will vou comment on this, in general. Mr. KuJAWA. T would recommend, basically, the approach that is being taken in the Murphy bill — which, if T understand it. is a phased approach, that you complete a phase, and if it still looks like it is a go decision, you proceed to phase two. And T would agree with Colonel Sheffoy that the first phase ought to be the economic phase. And the financial analysis of the altemati\^es ought to be in phase one, or at least ought to be a major part of phase one. And if this analysis concludes that the iiiA'Pstment in o sea-level canal can be justified economically, yon ought to proceed to study 336 it further. Then the question occurs as to the role of the engineer and the role of the ecologist. I am not going to comment in this regard, because I am not expert in their fields. Mr. NoNNENMACHER. I have only two more questions. I would like to expand on your statement at its conclusion, that ship construction may be stimulated. I asked the question previously of the witness from the Marine Engineers, Mr. Marlowe, who indi- cated a similar point. And I asked him: Would routes be changed by a sea-level canal, and the amounts of cargo from any given source to any given destination, through the canal — would these cargos be increased? Would you care to enlarge on your point that ship construction might be stimulated, in view of the facts about routes and cargo hauled on those routes. Mr. KujAWA. Of course, what is shipped and the routing it takes, is influenced heavily by economics. The Japanese may buy coal from Australia instead of the east coast of the United States, because of transportation costs. Millions of tons of coal move from Hampton Roads on the east coast of the United States down to Brazil, where the ship tops off with iron ore, and makes its route around Cape Horn to Japan. Now, that is potential traffic for a canal. But since the present canal is limited in terms of capacity, that traffic is moving on ships too large to transit the canal on alternative routes. So there is this kind of diversion taking place right now. The present economics which are based on the existing Panama Canal constraints however would not necessarily hold true for a new canal. The changed economics could aflfect the ship size that most efficiently and economically carries cargo. Mr. NoNNENMACHER. I appreciate your answer. Thank you very much. Mr. Chairman, I have some other questions that I would like to submit in writing. Mr. Metcalfe. Unless there is objection, the additional questions will be submitted for the record, and will Mr. Kujawa answer them. We will appreciate it. Mr. Kujawa. I would be pleased to respond. [The following was received for the record :] Questions of Mr. Nonnenmacher and Answered by Mr. Kujawa Question 1. Senator Gravel told the Subcommittee that he projected a sea- level canal built by private funds. Do you see this as a likely possibility under any circumstances? Answer. At this i)oint my best guess is that a study of the economic feasi- bility of a sea-level canal will conclude that it will not be capable of re- covering the construction costs from toll revenue. Based on present inflation, there will probably be a need for a substantial government subsidy which demonstrates tlie substantial financial risks involved in the construction of a new canal. Private firms are unlikely to be willing to as.sume such a level of risks. I have previously pointed out that there may well be significant indirect benefits flowing from the construction of a new canal. These indirect benefits would not be a source of financial compensation to a private enterprise but could well be a benefit to the U.S. and other economies taken as a whole. Since the U.S. economy may be enjoying indirect benefits, there may be a basis 337 to support government financing of the project. A sufficient level of U.S. and/ or other government subsidies or guarantees might also provide a means by which private funds for construction might be attracted. Under these circum- stances the governments would be reducing the level of risks being assumed by providing funds through their guarantees. Question 2. What factors would make the building of a sea-level canal in a country other than Panama much more attractive financially? Answer. The construction of a sea-level canal in a country other than Panama could be attractive if the construction and operating costs would be at a lower level. This could be possible in at least the following four areas : 1. Lower direct payments to the host country by the canal-operating entity. The present treaty provides for payments to Panama for approximately $65 million annually that will escalate in future years based on inflation and the level of traflic. 2. Lower labor costs. Panama tends to be a high cost labor country. Other countries in Central America are likely to have lower labor costs and this could result in lower construction and operating costs for a canal located in another country. 3. Direct financial assistance. Although somewhat unlikely, another country may wish to attract a sea-level canal and be willing to offer some level of direct financial assistance. 4. Shorten the routing. A canal built north of the present canal would be more attractive to significant trade routes by reducing the shipping route distances. This would increase the potential for tolls. Question 3. If oil import trade-offs are made with Japan, what amount of Alaskan oil, if any, would still need to be transported to the Gulf Coast and East Coast refineries? Answer. I see little need for Alaskan oil on the Gulf and Bast Coasts if all of the requirements are being met by oil from the Near East. Question 4- Would you please comment on the economic comparisons Senator Gravel made between pipeline and canal transportation of Alaskan oil, espe- cially in view of the fact that the projected sea-level canal could normally handle only 150,000 dwt. vessels and up to 250,000 dwt. only under controlled conditions, and he uses 265,000 dwt. ships. Answer. Fundamental to the economic comparisons made by Senator Gravel was the assumed toll level. This assumed toll level was sufficiently low to demonstrate that the canal was more economically attractive to shippers than a pipeline investment. However, the pipeline investment would likely be re- covered in Senator Gravel's comparison whereas the canal investment would not. Question 5. What existing trade routes do you see augmented with what additional traffic carrying what products should a sea-level canal be built? Answer. Certain traffic is now diverting the Panama Canal that may be attracted by a new canal. These diversions include coal, grain and container traffic. Question 6. What new trade routes carrying which products might be opened up by the building of the sea-level canal? Answer. I am unaware of any new trade routes that would develop if a new sea-level canal was opened. Question 7. Please project estimated operating costs of the projected sea- level canal including interest payments and the amount of traffic that will be required just to maintain a break-even operation. Answer. Recent sea-level canal construction costs estimates have ranged between $10 billion and $20 billion. Therefore, to put the magnitude of the revenue requirement for a break-even sea-level canal operating in persjiective. traffic at present Panama Canal toll rates would have to increase by 260%, 440% or 620% to pay just the interest costs on a new canal at levels of as- sumed costs of $10 billion. $15 billion or $20 billion respectively. Question 8. Colonel Sheffey testified that no amount of study could possibly predict accurately the factors affecting the sea-level canal's costs or financial feasibility. He said : " * ♦ * By acquiring maximum information, you do not improve the quality of your estimate very much." He also said : " * * * You can spend $1 million on a project and in five years it will be worthless because no economic forecast of this nature can be made 50 years into the future." 338 Do you agree? Answer. It is necessary that long range planning be based on factors that may change in the future. The changing nature of our environment does not reduce the need for informed judgments about the future based on long range planning techniques. In my opinion, a long range plan for operation of the existing or an alternative canal is necessary and should be based on as comprehensive an evaluation of factors as can practically be undertaken at this time. Question 9. Project, on the basis of your experience with the existing canal, the likely cost of excavation due to slides after completion of the proposed sea-level canal. Answer. I have not undertaken an evaluation of the cost of excavation due to slides. Question 10. Regarding your very sensible proposal for a study of alterna- tives to tlie sea-level canal, what kind of accuracy can you project regarding the types and efficiency of air and land transport 25 years or more into the future? Answer. My response to this question is basically the same as to Question No. 8. The efficiency of air and land transport 25 or more years in the future is likely to change. However, how these types of changes may relate to the existing or proposed canal should be studied as a basis for a long range plan. Also, long range decisions in both the public and private sectors can be highly interdependent. Thus long range canal plans can impact those of the transport industry in general. Question 11. Please specify what projects and estimate what costs would 1)6 involved in "enhancing" the present Canal if neither a sea-level canal or the Third Locks Project is authorized. Answer. The enhancement of the present canal, exclusive of considerations regarding a sea-level canal or a third set of locks, could involve expenditures of several hundreds of millions or billions of dollars. The most significant cost would be related to the widening and deepening of the existing channel. The Panama Canal continues to experience an increase in the size of ships to which it provides service and this requires special considerations such as restrictions to daylight transit. If this trend continues, the accommoda- tion of the level of traffic calling on the Canal may well justify further widening and deepening projects. Deepening of the existing canal is considered the most economic way to provide additional water supply to handle traffic requirements. If traffic levels continue to increase, it will be necessary to augment water supply in some manner and the most likely prospect is a deepening project. Additional traffic levels will also require additional investment in equip- ment such as tugs and lock locomotives. Question 12. What would you estimate the construction costs of the Third Locks expansion to be, taking into consideration the same interest, inflation and other factors that, in your testimony, brought your sea-level canal cost estimate up to $20 billion? Answer. Based on the $1.53 billion total construction cost estimate of a Third Locks project, as projected in the Atlantic-Pacific Inter-oceanic Canal Study Commission Report, I would estimate that construction costs of a Third Locks expansion would aggregate some $12 billion. This estimate as- sumes a ten year project to be completed in 1995, with both annual inflation and interest rates at 7%. Mr. Metcalfe. The Chair next recognizes Mr, Tannenbaum. He wants to ask a few questions. Mr. Tannenb.\um. Apparently yon do not favor an update of the 1970 study, but an entirely new look at the alternatives; is that correct ? Mr. KujAWA. Well, I favor both. I think to be clear, the 1970 study certainly had many aspects to it that are valuable and need to be updated. But it also needs to be expanded, I believe, to the broader question of where we go from here. The 1970 study for the most part addressed the very specific questions of whether or not to build a sea-level canal and how should it be done. 339 I would like to broaden that question. Mr. Tannenbaum. How would you allocate somewhere between $1 million and $2 million? How would you allocate that money, as against the alternatives? Mr. KujAWA, Well, as I pointed out, I am just giving you an off-the-cuff guess as to what is a totally long-range plan, and what such an economic feasibility study would cost. The details of it I really cannot give you because it is a guess. Mr. Tannenbaum. You still feel that the sea-level canal would be a fiscal fantasy? Mr. KujAWA. I doubt that you are going to be able to prove through a study that a sea-level canal can be self-financing and that therefore, the direct benefits flowing from it are not going to pay the cost. That conclusion is consistent with my testimony approximately a year ago on that subject. Mr, Tannenbaum. Yes. In fact, the existing canal was really not a fiscal success in a true sense. Is that true? Mr. KujAWA. That is an interesting question. Of course, I have been associated with the financial affairs of the Panama Canal for many years. There has never been a full cost accounting of the Panama Canal from day one. I suspect that if you did a full ac- counting that you would find that all the costs have not in fact been recovered through revenue. But that is again what I will call an off-the-cuff comment because there has never been a complete analysis of that issue. Mr. Tannenbaum. I think you pointed out that costs also should include interest and profits, if you are talking about economic viability. Mr. KujAWA. Yes, sir. Mr. Tannenbaum. Certainly if you add those factors into it, the cost figures that we have seen are misleading. Mr. KujAWA. Yes, sir. Mr. Tannenbaum. There have been estimates we have heard in the last couple of days somewhere between $6 billion, $8 billion, as the cost of a new sea-level canal. Do you concur with those figures? Mr. Kujawa. Well, the basis for that $6 to $8 billion is as follows, as I understand it. The 1970 study estimated that a new sea-level canal, a single-lane, 550-foot-width canal, would cost somewhere around $2.8 to $2.9 billion, as I remember. Adjusting that estimate for current price levels, this may be some- what unbelievable, but price levels of construction costs have almost doubled since 1970 to today. So price level changes alone get you from $2.9 million to somewhere near $6 billion. And then there were concerns with the 1970 study regarding construction risks as to the fact that the estimates therein were based on average conditions. What happens if we get some bad luck, and something else hap- pens? So there is a recognition that the 1970 study provided a very conservative estimate, and costs could be substantially higher than that. So then you get from $6 billion to some other number like $8 billion, or whatever; and if you complete the project now over the 340 next 10 to 15 years, based on any expansion in inflation, you could be somewhere around $15 billion before you got the job done. Mr. Tannenbaum. $6 to $8 billion, in 1977 dollars? Mr. KujAWA. Right. And you can extrapolate that forward to 1985, 1990, and be at $15 billion. Mr. Tannenbaum. Then the added interest factor Mr. KujAWA. With interest the total cost could be $20 billion. Mr. Tannenbaum. And higher if you compound the interest factor ? Mr. KujAWA. A compounding of interest cost would increase the cost to beyond $20 billion. Mr. Tannenbaum. Thank you very much. Mr. Metcalfe. Thank you very much, Mr. Tannenbaum. Thank you again, Mr. Kujawa, for your very fine testimony. Mr. Kujawa. Yes, sir. Mr. Metcalfe. Our next witness is Mr. David E. Ortman, research associate with Friends of the Earth. Mr. Ortman monitored the National Academy of Sciences update last fall and has written extensive articles on the effects of a sea- level canal for the Friends of the Earth. In addition, Mr. Ortman has coordinated responses to the Panama Canal Environmental Impact Statement and the Gravel amend- ments among other environmental groups. We also have Ms. Marni Holbrook, who is an environmental affairs associate with the Izaak Walton League of America. She has been on the staff' of the League for 5I/2 years. And rounding out this panel — and we would appreciate it if they would all come to the witness table — is Dr. C. Richard Robins, who is a fisheries expert and who has done extensive work on the subject of the ecological effects of a sea-level canal. Dr. Robins com- pleted a study of the 1960's which was submitted to the Battelle Institute, and which formed part of the environmental study for the Atlantic-Pacific Commission. We are very happy to have these distinguished panelists with us today, and recognizing that Dr. Robins has to catch a plane and that we are all under restraints, we will first start out with Dr. Robins. But I would ask all three of the panelists, if you will, to submit your statements for the record. And I will ask now for unanimous consent that the entire statements be entered into the record. Without objection it will be done. And starting with Dr. Robins, if you will summarize your statement, so that you may leave after we We may have some questions to ask you. Dr. Robins, proceed, please. [The following was received for the record:] Statement of David Ortman, Friends of the Earth Good Afternoon. My name is David E. Ortman, a Research Associate with Friends of the Earth. Friends of the Earth is a national environmental organization with approximately 20,000 members. In addition, we have sister organizations in sixteen foreign countries. We wish to exiiress our appreciation to Mr. Murphy, Chairman of the Merchant Marine and Fislieries Committee for his \villingne.ss to hold full public liearings on proposed legislation to undertake another sea-level study as he indicated were necessary last year. 341 We also appreciate the concern for this issue that Subcommittee Chairman i\Ir. Mete-alfe has .shown on the trucial questions of tiniinj,' as well as the scoiie of the legislation. We have also been impressed with the professionalism and detailed knowledge of both the minority and majority staff members on this issue. This is the first opportunity we have had to present in-depth testimony to either house concerning this matter of a sea-level canal. No longer are we in an age such as the sixteenth century where the Church could inform Philip II of Spain, who was contemplating an interoceanic canal across Panama, "If the Almighty had intended there should be a waterway across the Isthmus one would have existed naturally." Still, the magnitude of what would be the largest public works project in history should give us some pause before we go plunging ahead recreating this good earth. We would like to present short summaries of some of the key issues we are concerned with and submit supporting material for the record. Because of the interest in this subject we would ask that the hearing record be kept open, so that additional scientific and environmental response might be forth- coming. We hope to get an update for instance of the letter (Attachment A) from Dr. John E. McCosker, Director of the Steinhart Aquarium, California Acade- my of Sciences, who wrote (29 August 1977) to the National Research Council, "I am disappointed, chagrined actually, to discover the resurrection of the Sea-level Canal concept. I would have thought the previous exercise was satisfactory to demonstrate the futility of such an experiment before adequate baseline data had been collected." ECOLOGICAL EFFECTS There are three basic facts that we wish to emphasize. First, fresh water Gutan Lake is the ONLY known effective biological barrier between the two vast living marine systems in the Atlantic and the Pacific. The biological bar- riers which have been proposed, bubble curtains, electrical wires, ultrasonic screens, etc. border on fantasy. This is wliy the possibility of sea-water pumping as Dr. Robins had mentioned into Gatun Lake as well as the deforestation question is also of such crucial concern to us. If the watershed is not maintained, the Pana- manians may be forced into sea-water pumping with the resultant loss in effectiveness of the fresh water barrier a remedy opposed by numerous scien- tific organizations. Secondly, the possible ecological effects of a sea-level canal extend far be- yond sea-snakes (Pelamys Platurus), Crown-of -Thorns starfish (Acanthaster planci) or Pacific coral-feeding puffer fish (of the genus Arothron) in the Carribean, although this may be reason enough to halt such a project. These effects include : a) the tran.sfer of potential pathogenic microorganisms b) the creation of a stres.sed environment which may enhance vulnerability for disease in either immigrants or indigenous species c) predatory -prey relationships which might be upset d) pos.sible adverse impacts on the $54 million dollar Panama fisheries e) interbreeding leading to sterilization of the offspring in some marine species f) elimination of some species due to competition from species of the other ocean. The Council on Environmental Quality (memorandum for Frank Press from iMarion Edey 23 Aug. 1977) listed a number of other concerns (Attachment R). Thirdly, as the testimony of both the Smithsonian and the Panama Canal Company clearly pointed out, we have had study after study of engineering reports on the question of a third lane of locks or a sea-level canal. Despite constant pleas ever since 190S. the bare facts remain that any decision to construct such a project would be a decision made in ignorance. This was recognized by the Norwegian Ass)ciation for Ecology which wrote in February of this year, "The proposed sea-level canal across the American Isthmus may give local as well as distal impacts on marine ecosystems. This make the project an international matter and a common practical and scien- tific concern." (Attachment C) 342 ENVIRONMENTAL CONCERN Friends of the Earth which was formed in 1969, took notice of the sea-level canal project even before the Canal Commission published its 1970 report, due to the controversy involving the National Academy of Sciences' Committee of Ecological Research for the Interoceanic Canal and Mr. John Sheffey, a retired Army colonel and Executive Director of the Atlantic-Pacific Inter- oceanic Canal Study Commission, which is very well summarized in the at- tached article (Vol. 2, 1972) of the Bulletin of the Biological Society of Washington by Dr. William A. Newman of the Scripps Institution of Ocean- ography, California (Attachment D). In 1975 as well as 1977, Friends of the Earth, joined by numerous other national and international environmental groups, sent a telegram to President's Ford and Carter (Attachment E) urging that the sea-level canal project be finally laid to rest. Though we could find no support within the administration for such a project. Senator Gravel was successful in convincing President Carter to advocate the construction of a sea-level canal at a "town meeting" in Yazoo City, ^Mississippi 21 July 1977 shortly after Gravel had met with Carter at the White House. Ten organizations cosigned a letter with Friends of the Earth voicing our concern with the Gravel amendment and asking that the Senate oppose it (Attachment F). There are several fatal flaws in the Gravel amendment. a) The mechanism for selection of the joint commission is totally unac- ceptable. It is clear that its? sole purpose is to assure as best as possible Senator Gravel's placement on such a commission. In addition, we agi'ee with Ambassador Popper's remarks that the Panamanians be allowed to select their own members of such a commission. Our position is that, as in 1964 when the last interoceanic canal study was authorized, that the President appoint to a Commission three (if that is the number decided upon) citizens from private life and that the Republic of Panama select the meml>ers of its side of the joint study. b) The amendment does not specifically rule out examination of nuclear excavation. We recommend that any update of the 1970 report examine only non-nuclear means. c) Senator Gravel has overlooked or minimized what we call secondary environmental effects of such a project. Among these include : 1) effects on world oil spills due to increase in supertanker size 2) effects on U.S. ports due to increased dredging due to supertankers 3) effects on terminal cities of Panama City, Balboa and Colon due to removal of traffic from existing canal. d) My analysis of the discussion concerning this amendment in the Senate indicates that had the full facts been laid out, that the Senate most likely would have stuck to its original vote and vote and refused to authorize such a study. Unfortunately, there was little real debate, and a tremendous amount of personal lobbying appears to have turned the vote around for the Senator from Alaska. At any rate, on 7 Sept. 1977. before the National Acaremy of Science had time to assemble all the biological and ecological data gathered since 1970 requested by the White House and ten days after the State Department had released the draft EIS on the treaties. President Carter and General Torrijos signed the Panama Canal Treaties which contained paragraph 1 of Article XII calling for a joint sea-level canal study. OVERALL PLAN Bringing up the rear, as environmental panals so often do, is sometimes an advantage. In this case it has allowed us to listen to nearly all the testimony submitted to this committee. Several facts stand out : a) The recently passed ti'eaties call for a joint Panama-U.S. sea-level canal study, sometime during the duration of the treaties. b) The Panama Canal Company has testified that the current canal would not reach capacity until snmetime after the turn of the century. c) The Department of Defense has estimated that it would take around 14 vears to construct a sea-leve\ canal. 343 d) Senator Gravel as well as Congressman Murphy seem to feel that an up- date of the 1970 study might be done in as little as three years. e) The Smithsonian Institute has testified that the research on ecological studies would take around ten years in the range of $15-25 million. Remembering that the current canal does not become obsolete, merely that it reaches its carrying capacity in the next century, let us say that this oc- curs in the year 2005. If we wished to have a sea-level canal in operation at that time, we would need to begin construction around 1990. This means that there would be plenty of time to conduct a thorough series of ecological studies beginning in 19S0, allowing over a year to prepare a clear study plan such as the Smithsonian has already basically done. What of the update of the 1970 study? One thing that seems apparent is that these types of s'tudies quickly become out of date. Witness the fact that the $24 million study completed in 1970 is almost totally worthless for our purposes, even though it was built on four previous studies of one kind or another. If we can accept the fact that construction for such a project would not begin before 1990, then you would want the most up to date information on engineering and economics possible requiring such studies to begin around 1987 and completing them along with the ecological studies AT THE SAME TIME so that a decision can be made with the maximum amount of informa- tion available. The State Department assures us that they support writing an environmental impact statement for a sea-level canal even seemingly if it were built and financed by the Panamanians, but their use of an impact statement with the Panama treaties themselves was a total fiasco with the final statement not even completed until well after the treaties were signed. We want to make sure that such decision-making does not take place again without the environ- mental studies available and part of the considerations. Friends of the Earth feels that this long range outline satisfies several re- quirements : First, it would satisfy the requirements of the Panama Canal Treaty, albeit at some future point in time. Secondly, it would satisfy, I believe, both the scientific and envii'onmental communities that their concerns were being addressed and that environmental concerns were not given short shrift. Third, the environmental studies would give the yet to be formulated Joint Panama-U.S. Ecological Commission a firmer basis to make such decisions on deforestation and sea-water pumping issues. We would like to support a long range plan that is both reasonable and comprehensive. Senator Gravel's proposal is neither. Now is not the time to update the 1970 study, for if the study is done it will soon be outdated, unlike the biological data which will give us badly needed information that will be useful. We ask that this proposal be given serious thought by the Panama Canal Subcommittee. Thank you for the opportunity to present it to you today. 344 5TEIIMHART AQUARIUM CALIFORNIA ACADEMY OF SCIENCES / GOLDEN GATE PARK / SAN FRANCISCO / CALIF 94118 i£TT£fi- /V ATTACHMENT A August 29, 1977 Dr. Alfred M. Beeton Chai rman Committee on Ecological Effects of a Sea Level Canal National Research Council 2101 Constitution Avenue Washington, D. C. 20^) 1 8 Dear Dr. Beeton: I am disappointed, chagrined actually, to discover the resurrec- tion of the Sea-Level Canal concept. 1 would have thought the previous exercise was satisfactory to demonstrate the futility of such an experi- ment before adequate baseline data had been collected. Herein are my thoughts relative to the concept and subsequent to the Batelle Reports. These stem from my experiences with the Smith- sonian Tropical Research Institute doing fieldwork in 1970-71 and subsequent trips to Panama, Costa Rica, Baja California, and the Gala- pagos since 1972. Below are comments on Mr. Press' questions to Mr. Handler (1 August 1977). I. NATURAL OR MAN-MADE BARRIERS: The present natural barrier of Gatun Lake is adequate to prevent faunal passage; the few species that have survived the transit have, for reasons not yet adequately explained, been unable to establish populations on both coasts (cf. McCosker and Dawson, 1975, Marine Biology, 30: 3'43-351). 1 am concerned that th e misconception of an effective estuarine barrie" still exists. Not long ago, the Han Canal Co. and the Army Corps of Engineers proposed that seawater pumping into Gatun Lake would increase ship passage with- out significantly affecting the natural barrier. An estuarine barrier, as Dawson and I suggested, would not be effective. 2. MIGRATION THROUGH A SEA LEVEL CANAL; This will certainly depend upon the location of the canal entrances. The present configura- tion, with very different habitat types at the canal entrances, has allowed the migration of reef-associated species, even though the Pacific entrance is largely mud and mangrove and the Atlantic is a typical coral reef habitat (just outside of Limon Bay). I suspect that larvae of adults unable to survive in either habitat would transit the canal (no adequate sampling has occurred in the present canal entrances) and bypass habitats unsuitable for adults. I suggest that 345 Dr. Alfred M. Beeton August 29, 1977 few biologists would deny that a sea level canal without barriers would allow the migration of most if not all of the shallow water species with vagile larval forms. 3. ECOLOGICAL EFFECTS OF MIGRANTS: I am most concerned about this. All studies to date seem to allow only inferential guesses as to the effects of faunal mixing. John Briggs, in numerous places, has predicted widespread extinctions. Rosenblatt, et al., (1972, Los Angeles County Musuem Contributions in Science, no. 23'*) and I (1971, Copeia (A): 682-686) disagreed with Briggs' conclusions that Caribbean species have a "competitive edge", but concur with him that experi- mental work need be done. More significant, I feel, would be the problems encountered by prey faced with a new suite of predators. For example, the Crown-of-Thorns Starfish Acanthaster planci might have a field day when introduced to an ocean of coral which has not evolved anti-predator structures toward coral -feeding starfish. A similar free-lunch would be provided to the abundant Indo-Pacific cora 1 -feeding pufferfishes of the genus Arothron (see Glynn, et al., 1972, Geol . Rundschau, 6l: '483-519); no ecological cognate to Arothron exists in the Caribbean. li. OTHER ENVIRONMENTAL EFFECTS: Recently discussed but not resolved are the effects of Sea Snake ( Pelamys platurus ) activity in the Caribbean. Both biological and tour i sm-re 1 ated problems might occur. To sum up, if one accepts the commission conclusion that "the risk of adverse ecological consequences ... appears to be acceptable", then I suspect that whatever suggestions one makes are unnecessary. The current state of knowledge has not increased appreciably since that time -- that, in itself, gives me reason to be concerned. I hope this is of some assistance to you and your committee. Sincerely, Oohn E. McCosker Di rector JEMc:mt cc: Dr. Sylvia Earle Dr. C. Richard Robins Dr. R. H. Rosenblatt 346 ATTACHMENT B EXECUTIVE OFFICE OF THE PRESIDENT COUNCIL ON ENVIRONMENTAL QUALITY 722 JACKSON PLACE. N. W. WASHINGTON. D. C. 20006 August 23, 1977 MEMORAKTDUM FOR FRANK PRESS FROM: Marion Edey SUBJECT: Follow-up on Panama Sea Level Canal Issue This is to follow up on Kathy Fletcher's memoranduiri to us in which she suggested that we should work together. You have contracted with the National Academy of Sciences for a six-weeks' study of changes since the 1970 study in the state of knowledge about the ecological impacts of a sea level canal. Our understanding is that you have asked the Academy to concentrate on the marine impacts of mixing the Atlantic and Pacific biota, and on the possibilities of the barrier, We believe that in this review, the following subjects should be covered as fully as is possible: — Genetics and speciation of the two biotas which would bear on potential impact of mixing. — The possibility of hybridization between similar forms which would lead to possible sterilization. — The earlier study emphasized our paucity of . knowledge even in terms of inventory of the species which might be affected at either end. Clearly, such an inventory should be carried out prior to construction of such a canal. What is the current state of knowledge? — Potential interchange of diseases and parasites, impact thereof. — Potential interchange of predators and other competitors with existing fauna, and potential impact thereof . 347 Current knowledge of the impact of the canal on commercial species, recreational species, and ecologically critical ones. Possible impact of interchange of the sea snakes, sharks, and other species of particular public concern. Physiological tolerance of the organisms involved, in adults and subadult form, which would have significance to the requirements for a barrier. What has been learned about barriers which could be installed presumably in combination with a tidal barrier — i.e., freshwater, thermal barrier, bubble curtains, electric weirs, ultrasonic screens, and other possi- bilities? Given the volume of water involved, what dimensions of barrier would be involved and what would this mean in terms of needs for a supply of freshwater (and is it available on a reliable year round basis) , and of generation of electricity, etc.? Perhaps most important given the state of knowledge, state of tech- nology, and the availability of resources (energy, freshwater, and capital, in particular), how practical does a barrier really look? What is the size of the canal that would be needed and how would this impact environmental considerations? The 1970 study assumed a canal which could accomodate 250,000 ton ships "under controlled conditions." Presumably, larger capacity is required now both for oil and mili- tary purposes. If so, how much bigger would the canal be, and what would be the effect on potential mixing of biota, problems of barrier construction, and other impacts? While the Academy is focussing on aquatic impacts, it is clear that there are terrestrial impacts which should also be considered. Our knowledge of environmental impact assessment has increased greatly during the past seven years, 32-461 O - 78 - 23 348 and there has been at least one major impact statement in for a project in Panama (Darian Gap) . Consequently, attention should be given to an update of the terrestrial impacts as well. We will be pleased to discuss these with you or your staff, and we will follow with great interest the progress of the Academy of this important project. cc: Charles Warren Lee Talbot Jerry Bertrand 349 Norsk Okolofiisk Forcninp ATTACHMENT C ■ «OIKOS» OPINION ON PROPOSED SEA-LEVICL CANAL, PANAMA The international Society for the Protection of Animnls - TSPA h.is infortned cliu I.'oiwuglrti'i Aaovjv.Ie.i.lo.1 r,.! .r.c.-, .>,t,j. ZZrcZ ..L^^u r:-.v. pri.-.cs:.,: ir.icrcccanic sea-level canal in the Republic of Panama. Being aware of the possible far reaching and irreversible consequences in time and space of ecological nature involved in the project, we herewith exi'ress the followiiif; juJcemont. - The proposed sea-level canal across the American Isthmus may give local as well as distal impacts on marine ecosystems. This make the project an international matter and a common practical and scientific concern. - Experience from earlier constructions o canals seriously iinplias i :m; the necessity of careful evaluation, pi nning and development on the project. - Expertise of marine biology must ensure that the final derision about realizing the project is firmly based upon adequate ecological know- ledge. It is urgent that detailed information about the project and the several impacts of this exploitation on marine resources should reach the nations and governments with interests in the oceanic areas con- cerned. Blindern, Norway, February 16th, 1978 Olav M. Skulberg fl ^0 ATTACHMENT D THE NATIONAL ACADEMY OF SCIENCE COMMITTEE ON THE ECOLOGY OF THE INTEROCEANIC CANAL By William A. Newman Scripps Institution of Oceanography, La JoJIo, California, and Member, Committee on Ecological Research for the Interoceanic Canal The Panama Canal is a lock canal too small to accommodate many of the larger ships traxelling between the Atlantic and the Pacific Oceans today. In the foreseeable future it will be unable to satisfy the increasing demand for ordinary ship tran- sits. The canal requires a considerable amount of water to operate. A single complete transit by a ship utilizes 52 million gallons of fresh water, or enough to supply a large city for a day. Presently the canal can handle up to some 40 ships a day, or 14,000 ships a year, when enough watt^ is a\ailable. Fresh water is the principal factor limiting the canal's opera- tion. But even if water needs are satisfied, there would always be the limitation of the locks. Improvements can increase their capacit)' somewhat but, even so, it is estimated that maxi- mum capacity set b\' the rate ships can be passed through locks would be reached in the next thirty years or so. Because of this the United States Government decided to look 'ito the feasibility of a new canal, preferably a lockless one at sea level. In 1964, the United States Army Corps of Engineers, the Atomic Energy Commission and the Panama Canal Company completed a study of 30 possible routes for a sea-level canal, with special reference to nuclear excavation. In 1965, President Bull. Biol. Soc. Wash., Vol. 2, 1972 (247) 351 248 Bulletin of the Biologkal Society of Wasliiu^ton Lyndon Jolmson appointed a five-man connnission of citi/ons from private lite to stud>' tlie overall sitnation, as well as the sites surveyed. The commission was called the Atlantic-Pacific Interoceanic Canal Study Commission, (hereafter referred to as the Commission). Members were: R. B. Anderscm, (Chair- man) M S. Eisenhower, Gen. K. E. Fields, R. A. Hill and J. P. Sheffey (Executive Director). The Battelle Memorial Institute, Columbus, Ohio (hereafter, BMI), was contracted by the Com- mission to carry out a number of environmental studies on a sea-level canal. The Commission was reappointed by President Richard Nixon and its report was to be presented to him in October of 1970. In 1969, the National Academy of Sciences (NAS) was re- quested by the Commission to appoint a committee of biologists to review what had been accomplished and to make recom- mendations to the Commission by April of 1970 with regard to the ecological problems surrounding a sea-level canal. The new committee, called the Committee of Ecological Research for the Interoceanic Canal (CERIC) was charged with the following responsibilities: Examination of ecological issues implicit in the construction of a sea-level canal, with special reference to the marine environment, and the outlining of a program of research that might appropriately be done in the period before, during, and after the construction of such a canal. Further duties were to assess the ecological impact of the canal and to recommend ways of minimizing damage that might, in fact, occur. Evaluation of the need for a canal, and the wisdom of constructing it, were explicitly excluded from CERIC's task — deliberations were to be carried out under the assumptions that a canal would be built, that it would prob- ably be located in the vicinity of the Panama Canal, and that construction would probably be by conventional means. CERIC consisted of: Ernst Mayr, Harvard University (Chair- man); Maximo Cerame-Vivas, University of Puerto Rico; David Challinor, Smithsonian Institution; Daniel Cohen, Bu- reau of Commercial Fisheries (BCF), Washington, D. C; Joseph Council, University of California, Santa Barbara; Ivan Goodbody, University College of the West Indies, Jamaica; W. Newman, Scripps Institution of Oceanography (SIO); C. 352 Naliotuil Acddcmij of Science Commiilee 249 Ladcl Prosscr, University of Illinois; Howard Sanders, Woods Hole Occanographic Institution; E. O. Wilson, liaward Uni- versity, and Donald Wohlschlag, University of Texas. Two ad hoc committees were subsequently appointed by NAS and CERIC. One on Oceanography included: Alan Long- hurst, BCF, La Jolla, (Chairman); W. II. Bayliff, E. Forsbergh, Forrest Miller and Merritt Stevenson, all of BCF, La Jolla; D. Inman and B. Taft, SIC) and C. Booth, University of Miami. The other, on Hydrology, included: Luna B. Leopold, United States Geological Survey (USGS), Wa.shington, D. C, (Chair- man); Walter W. Langbein, USGS, Washington, D. C; Thoiuas Maddock, Jr., USGS,Vucson; Robert II. Meade, USGS, Woods Hole. The following considerations are my understandings of the bases of deliberations of these committees: The Panamic Isthmus has separated the tropical American marine biotas, of approximately 8,000 Pacific and 7,000 Carib- bean species, for three to five million years and this period of isolation has allowed them to diverge markedly from whatever similarities they originally held. A 109< similarity between the Recent biotas has been estimated. Despite claims to the con- trary, CERIC observed that die Panama Canal has not allowed significant interchange between the two oceans because Gatun and Miraflores Lakes form a fresh water barrier between them. An unbarriered sea-level canal would allow biotic inter- change, the conse(]uences of v/hich are unknown. There would be two types of problems: those of scientific and those of economic importance. The latter of course cannot be separated wholly from the former and separation here is quite arbitrary. Consequences of scientific import include the disruption of fresh water and marine communities before they ha\e been adequately studied and the concomitant interactions that would follow. Those problems that presently can be identified as economically important include effects on fisheries, recreational resources, and general living conditions within the areas affected. What is apparently happening to the eastern Medi- terranean sardine fishery, presumably a result of the Aswan Dam, is a recent example of what can occur when large eco- logical changes are made. FurtheiTuore, the extensive studies 353 250 Bit] Id in of the HioJvj^icdl Socicit/ of \V(i.shin collapse ol the (>aIifoniia sardine industry were in i!;()od part necessitated by llie lack ol prexious knowledu^e. It would he far better to ha\e population dynamics of Pananiic fisheri(\s well-understood before a S(>a-level canal were built. Without l)ackt!;r()und information, attempts to understand and explain chanj^^es that occur after a canal is completed would have serious shortcomings. Transfer of undesirable marine organisms, undesirable in any terms one likes, but affecting recreational, fisheries and other economic resources, is a distinct possibility. The Yellow- bellied sea snake and the Crown-of-Thorns starfish are two Pacific forms that might get into the Caribbean, should an unbarricred sea-le\'el canal be built. The risk of introducing parasites and pathogens was also considered by CERIC, and there are undoubtedly many other kinds of interactions of which we are not awaie. CERIC, therefore, considered an unrestrictc>d breaching of the Pananiic Isthmus by a sea-le\el canal totally unacceptable because of what has been experienced when comparable bar- riers ha\'e been eliminated or all but elinu"nated in the past. It will be recalled that the Suez Canal r(Mnained an ineffecti\e connection between the Red Sea and the Mediterranean, until recently, because of the liypcrsalinc barrier formed by the Bitter Lakc\s. The same might be said of the Panama Canal because of the fresh water barrier formed by Catun Lake. We can also recall what an effectixe barrier Niagra Falls formed before ship canals by-passed them, letting the sea lamprey into the Great Lakes. Therefore, the establishment of an antibiotic barrier within an interoc(>anic canal was recommended by CERIC. Bubble curtains, electrical weirs, ultrasonic screens, etc., were among tlie physical barriers considered. All need much research and each has drawbacks. Pc>rhaps an c-ffc>cti\c' com- bination of two or more could be worked out. Such physical barriers were not highly recommended by CERIC, for, as with chemical barriers, CERIC claimed no expertise in this field. CERIC went on to consider treating the waters contained within the canal in some way. However, maintenance of a parcel of treated water in the sea-level canal would not be a 354 Ndlional Acddonij of Science Comniillcc 251 simple matter. There is a marked differenee in sea-le\"el and tidal amplitude between tlie two oeeans. Tlie Pacific side has a tidal ranj^e of 21 feet and is on the average 0.7 feet higher than the Caribbean which has a tidal range of but a few feet. A modern sea-level canal would have a cross-section of some 50,000 square feet, which, under these conditions, would allow an average flow of appro.ximately 1 foot per second. This would result in a net transport of about 50,000 cubic feet of water per second from the Pacific to the Caribbean, an amount equiva- lent to about half the discharge of the Nile before the Aswan Dam. Peak currents of eight feet per second, or about five kniots, would occur about 10% of a tidal cycle. During the re- mainder of the time, currents would range between some moderate negative value and four knots. Such strong currents would make the maintenance of a parcel of treated water within the canal virtually impossible. However peak velocities would not be reali/.ed because, for navigational purposes, tidal barriers were deemed necessary by the canal engineers. Therefore, CERIC recommended the tidal barriers be so arranged as to keep the net flow to a minimum, so that the contained waters could be treated and maintained in an appro- priate way, as an antibiotic barrier. CERIC concluded that a fresh water barrier was among the least objectionable. But there would be no possibility of sup- plying the amount of fresh water needed to form a hyposaline barrier unless the tidal barriers kept the flow very low. If the flow could be kept to a minimum, CERIC considered a fresh water barrier worthy of investigation by the engineers. CERIC also considered that if a parcel of water within the canal could be warmed sufficiently, an efficient thermal barrier could be formed. Nuclear or conventional power plants probably would be needed in the new canal zone and CERIC suggested perhaps the waste heat could be used to supply the thermal barrier. CERIC recommended that fresh water and thermal barriers be combined. The effectiveness of fresh water and thermal barriers would be much enhanced when used together due to the synergistic relationship between them. Virtually all marine organisms would be killed by a residence time of 48 hours in 0.5-1.5a< (< 5%) seawater. Temperatures of 45°C, 355 252 Bulletin of the BioloiS,ical Society of Wasliin^lon alone, lor the saiiu> p(Mio(l, would also he lethal. When salinity and tenipt>rature are combined lor 48 hours the ,i:;radient can he less s(nt're. For temperate forms, a salinity of 107^ (3.4'") and a temperature of 37-38°C was tentatively considered to be satisfactor)-. Research would liavc to be performed to see if these fi<:;ures w ould be applicable because they are based on experiments carried out on relatively hardy temperate species. In general, tropical organisms are more sensitive to change, especially in temperature, so an even less severe gradient might be practicable. General conclusions were that researches should begin well in advance of the canal's construction. Laboratory work in physiology should include research on osmotic and thermal tolerances, reproducti\'e cycles, and life histories. Additional collecting of the biota for taxonomic studies, as well as detailed work in systematies, would also be required. Field studies should include work on nearshore communities, such as man- grove swamps, mud flats, soft bottoms, and coral reefs, as well as oceanographic studies. Oceanic work considered included biological, chemical, physical and geological oceanography. The pursuit of these res(\irches would require funding, space, sliips, and administration. In view of its findings, CEl-lIC recommended that a Com- mission on the Ecology of ihe Intcroccanic Canal be estab- lished. A distinguished governing board of North, Central and South American scientists would be required, and the principal administrative office for this board would probably best be situated in Washington, D. C. One major 120-150 foot ship, two 65 foot trawlers, and an assortment of small craft were considered necessary to support field operations. Ten principal international investigators, plus a supporting staff of at least 20 junior scientists, technicians and secretaries, would be resident personnel. Space and funds for visiting investigators should be available. Two laboratories, one on the Caribbean side and a major one on the Pacific side, would be needed for physiological, marine biological, sys- tematic, and oceanographic work. Subsidiary laboratories, especially in the Caribbean, would also require support, es- pecially after the canal was operational. 356 NdtioiutI Academy of Science CoDunittec 253 An itcMiii/cd iiiilial capital outlay was cstiinatccl to be; ap- proximately 4 million dollars with an annual operating bud- get of about 2.5 million dollars. It should be borne in mind that 22 million dollars were spent looking into the feasibility of nuclear exca\'ation (now considered impractical), and that the construction of a sea-le\'el canal by conventional means, at 1970 price-levels, is to the order of 3 billion dollars. Tlie ecological studies, then, represent but a small fraction of tiie total caj^ital outlay and operational costs of a sea-level canal. To summarize, the principal problem before CERIC was to evaluate existing knowledge on the effect of mixing two previ- ously separated biotas by creating an interoceanic connection across the Panamic Isthmus. The literature on the subject is scattered and varied, and conclusions range from "catastrophe" on one hand, to "no significant, or even beneficial, effects" on the other. CERIC viewed the situation in the following way: Specif- ically what would happen by allowing the two biotas to mingle cannot be predicted, but experience indicates that un- desirable events have followed virtually every ecological dis- ruption and barrier-removal in the past. Reduction or removal of the terrestrial and fresh water barriers that presently sepa- rate the Panamic marine biotas would obviously lead to ex- change, and the exchange would not be negligible. The effects of the exchange would not be limited only to the areas immedi- ately adjacent to the canal openings, but would be far reach- ing. Therefore, CERIC took the stand that, since undesirable consequences are likely, exchanges of these biotas must be prevented as much as possible. CERIC recommended that an antibiotic barrier be in- stalled. A sea-level canal would requii'e tidal barriers for navi- gational purposes. Engineers informed CERIC that these bar- riers would probably be submarine gates restricting, but not closing, the channel during periods of peak flow. CERIC, therefore, suggested that these gates be designed in such a way as to reduce the net flow to a minimum, so as to contain a thermo-hyposaline barrier, or any other effective antibiotic barrier, within the canal. The nature of the barrier was not sti'ictly stipulated. Studies of the synergistic effect of heat and 357 254 BtiJIctin of the Biohx^icul Society of Washington dilution necessary to kill representative samples of marine in- vertebrates, fishes, plants, etc., of the area would be needed, if a thermo-hyposaline barrier were utilized, since available data are based primarily on studies of organisms of the temper- ate region. CERIC recommended that the oceanography and marine biology of the region should be thoroughly studied, beginning as much as ten years before the opening of a sea-level canal, and that the situation should be monitored and studied after- wards, in order to check on the effectiveness of the barrier and to identify the causes of biotic changes likely to occur if the barrier were not being properly maintained. CERIC recommended that a commission be established to administer the funds, facilities and research concerning the Panamic sea-level canal. It further recommended, in general terms, the kinds of research to be carried out. CERIC's report and recommendations went to the Atlantic- Pacific Interoeeanie Canal Study Commission in April, 1970.^ Reverberations were immediately forthcoming. Two letters, one from Mr. Sheffey (Executive Director of the Commission) to Gerald Bakus, (NAS Staff Officer for CERIC), and another from Brigadier General R. H. Groves, ( Engineering Agent for the Commission) to Dr. J. S. Coleman, (Executive Officer, NAS), were circulated among members of CERIC. These letters give the tenor of the philosophy of the Commission. The following are my own responses to some of their assertions and queries, paraphrasing my letter of May 28, 1970 to Dr. Coleman, with copies to the aforementioned Commission mem- bers and to members of CERIC. At least two colleagues in CERIC, namely from Puerto Rico and Woods Hole, also sub- mitted letters in reply to the aforementioned, reflecting much the same feelings. In his letter of May 18, Mr. Sheffey stated that the "CERIC report ... is oriented almost entirely toward the alarmistic view point," implying that CERIC had taken an extreme stand. Actually it is Mr. Sheffey who has taken an extreme stand, 1 Editor's note: Another viewpoint of the subsequent events may be found in Boffey, P. M., 1971, "Sea-level canal: How the Academy's voice was muted." Science, 171: 355-358. 358 NalioiKil Academy of Science Committee 255 for lie Siiys that nothing need he consiclcrcd in allowing free intc;rchangc between the tropieal Ameriean biotas beyond faetors strietly associated with engineering practices because he believes the ecological consequences involve little or no risk. Actually CERIC's approach was, that "while ecologically undesirable, if a sea-level canal were deemed necessary for national purposes, it should be designed in such a way as to minimize ecological effects," and CERIC recommended an antibiotic barrier be installed. I hardly think this an alarmistic or extreme approach, any more than would be the recommen- dation that fish ladders and diverters be included in the con- struction of certain dams. In this same letter Mr. Sheffey went on to imply that he could rally a group of biologists that would back up his assertion that there would be essentially no undesirable ecological conse- quences connected with a sea-level canal and who would place their names on a document disavowing recommendations for preventing free interchange of tropical American marine biotas. Could such a group, acceptable to a (juorum of ecologists, be assembled? It seems very doubtful that a knowledgeable per- son would allow himself to be held responsible for the un- desirable consequences that could result from the introduction of such organisms as the Indo-Pacific starfish, Acanthaster, or the Eastern Pacific sea snake, into the Caribbean. Con- sidering the wide range of conditions under which these or- ganisms presently thrive, there appears to be no compelling reason to suspect that they could not become successfully es- tablished in the Caribbean and, that they would remain dy- namically neutral in their new environment, would be most unlikely indeed. Such considerations have been discussed with informed people outside of CERIC, and have evoked agree- ment rather than arguments to the contrary. We are not faced here simply with the responsibility for the economic losses that might occur. The free mixing of tropical American marine biotas would enact irreversible changes, not only locally, but, eventually, throughout the Indo-Pacific and tropical Atlantic, that virtually no amount of might nor money could significantly alter. Experience in the past strongly sug- gests that some of these interactions are likely to be quite un- 359 256 Ihdlctin of the BU)lo<^ic(d Sociciij of Wasluti^toii desirable and the potential tlneat, as regards a sea-levc^I eanal, cannot be ignored. Mr. SIu'fie\' lias had an elastic collision with knowledge in liis argnnient that the Cro\vn-ot-Thorns starfish (and, there- fore, presumably many other organisms of which we know httle or nothing) already would have established itself in the Caribbean were conditions there faxorable for it. Such a state- ment only displays an ignorance of the facts and of the princi- ples of zoogeography and elementary ecology. General Groxes, while taking a more sober approach than Mr. Sheffey, in his letter of May 11, 1970, also queried CERIC's considerations, as though, somehow, the significance of the biological and physical data at CERIC's disposal had escaped CERIC. His major points were of b,vo types. The first con- cerned CERIC's judgments on the "desirability and feasibility of a sea-level canal." There is nothing known to be ecologically desirable about the sea-level canal. Virtually anything is pos- sible, of course, but the probability of desirable ecological effects is extremely remote. On the other hand, ecological changes are certain and, for the most part, irreversible, and the probability that some of these would be undesirable is great enough to warrant concern by all. From a purely ecological point of view, no canal should be built, and this is, perhaps, the recommendation an uncompromising conservationist would feel compelled to make. Desirability can only be couched in economic terms, for a number of reasons ranging from world commerce to defense, and these were neitlicr within the purview nor competence of CERIC to assess. If, for various non-environmental reasons, a sea-level canal were deemed essential, in order that it be ecologically tolerable, CERIC coji- sidered that the canal must be designed and constructed in such a way as to have as little ecological impact as possible, and must include mechanisms for the prevention of exchange of marine organisms between the tropical Americas when in operation. To prevent exchange CERIC recommended an antibiotic bar- rier be installed. CERIC had no expertise on how acceptable barriers could be implemented; decisions of feasibility would come from engineering studies. This was all in the report to 360 National Acadcmij of Science Committee 257 the Comiiiissioii, yet wc have heard virtually nothing of what feasibility problems this reeoiiiinended restraint would impose. As to assessing the "signifieant and rather extensive move- ment of marine life through the present canal" mentioned again by General Groves, and often reiterated by Mr. Sheffey, there is no documentation of this. There are a few fouling and euryhaline organisms, most of which have undoubtedly gotten through from the Caribbean to the Pacific, but these are neither numerous nor wholly marine. If it were known that a spectrum of marine organisms had been getting through the existing canal, primarily in ships' ballast tanks, it would be well that measures be taken to stop the transport, but there is no evidence that successful transports of this kind have been made. CERIG also recommended against salination of Gatun Lake, for even though the degree of salination probably would not be sufficient to permit passage for most oceanic organisms, it would nullify a good deal of the effectiveness that this fresh water barrier presently has in preventing the exchange of hardier shallow water forms. The impact that salination would have on the fresh water organisms of the region is another matter. General Groves' second question concerned ecological in- formation gathering and the research program needed, should a sea-level canal be built. Most if not all of the information needed to answer this was contained in the GERIG report, although it might not all be readily identifiable without a coni- plete reading. Therefore, one can only agree wholeheartedly with the General's suggestion that a five to ten page abstract of the GERIG report be published with the Gommission's report (see below as to what was published). In consideration of GERIG's recommendations, one would have thought the Gommission would have started exploring the kinds of antibiotic barriers that would do the job effectively and economically. There are a number of possibilities and, if appropriate minds were brought together to work on the prob- lem, it is likely a reasonable solution could be developed that would provide little or no interference with the operation of the canal, at negligible cost. The Commission's report went to President Nixon in Octo- 361 258 Bulletin of the Biological Society of \VasltiHecies to the region with the lesser fauna, but will accept few or no species in return. Second, each major habitat is probably supporting its maximum number of species. Addi- tional species can only temporarily increase the diversity ; over a period of time, the number of species can be expected to drop back to its original level. Migrated species will either eliminate an existing species or else be unable to establish themselves. Considering that the tropical western Atlantic has a richer fauna than the eastern Pacific, Dr. Briggs predicts that the Atlantic species would be the better competitors and would eventually eliminate their eastern Pacific rela- tives. Dr. Briggs states, "It is the prospect of a huge and irrevocable loss of perhaps thousands of species native to the eastern Pacific that constitutes the major biological problem presented by the Panama sea-level canal." For nearly four centuries before the United States took over from the French and began construction of the existing canal in 1904, Great Britain, Spain, and France had con.sidered the possibility of constructing an inter- ocean canal across Panama. In 1550 Antonio Galvao published a book that explained how such a canal could be built, and in 1551 the Spanish historian Gomara recorded that he tried to persuade Phillip II of Spain that such a project could be carried out. The Church of the sixteentli century took a dim view of such nonsense, however, and told Philip that "if the Almighty had intended there should be a waterway across the Isthmus one would have existed naturally." Ferdinand de Lesseps, engineer of the Suez Canal and President of an International Congress for Consideration of an Interocean Canal, succeeded in gaining the approval of this congress in the lS70's for a sea-level canal at 32-461 O - 78 - 24 364 Panama. In 1879 the French Canal Company began construction of a sea- level canal. It found that dissing through Panama's Continental Divide, and hacking tlirough its disease-infested tropical jungles were far more difficult than digging in tlie sands of Suez. Because of disease, a lack of planning, and financial difficulties, the French abandoned the project. As long ago as ISSO, the Select Committee on Interocean Canals of the House of Representatives recommended to Congress that it adopt a resolution declaring that the l".S. assert and maintain its right to possess and control any artificial means of Isthmian transit. This objective was supported by President Grant, who in February of ISNI publicly commended "an American canal, on American soil, to the American people." In spite of the fact that the French had given up a sea-level canal, the idea was I'esurrected and pushed by the chief engineer of the U.S. canal project in 1904, a man by the name of Wallace. However, President Theodore Roosevelt replaced Wallace with John F. Stevens. Arriving on the Isthmus on July 25, 1905, Stevens found progress hampered by a delay on the decision as to type of canal, then being considered by an international board of consulting engi- neers. In its report of January 10, 1900, this board split: the majority voted for a sea-level canal and the minority voted for a lock-and-lake type. With the support of President Roosevelt, Congress on June 29, 1906, adopted the lock plans recommended by the minority. A reservoir, Gatun Lake, was formed with locks on each side to raise ships to the sui'face of the lake, thus al- lowing passage by way of the Culebra Cut through the Continental Divide. This high-level plan averted the biological experiment we face in the modern sea-level canal proposal. The 1900 plan contained the one element necessary to avoid ecological disaster as predicted by Dr. Briggs — an effective biological barrier. Gatun Lake, u.s'ed as a waterway for approximately 32 miles of the 50-mile transit, is a fresh water reservoir. Organisms in salt water environ- ments on either side cannot survive the trip across Gatun Lake. The few animals that have made it across are thought to be organisms that attach themselves" to ships and later drop off. The locks are weakly saline because of the intrusion of seawater during ship passage, and a few species are known to exist now in the canal locks on both sides of Gatun Lake. Biologically speaking, however, the lake has been a remarkably effective barrier for more than 60 years. THE EXISTING CANAL In the operation of the Panama Canal, ships are lifted from one ocean through a set of locks? into Gatun Lake, 85 feet above sea level, travel cross the Isthmus, and then are lowered to the other ocean by another set of locks. When the lock gates open to admit a ship, 26,000,000 gallons of fresh water flow out to the ocean. When lock gates open to let the ship leave the Canal at the other side of the Isthmus, the same amount of water is released. At the rate of approximately 14.000 lockages annually, some 2.200.000 acre- feet of fresh water are required to operate the locks each year. Runoff and direct rainfall into the Canal system adds up to a net average of 4,300,000 acre-feet each year. About 30 percent of this is currently iised for power generation and other purposes. Thus, according to the Panama Canal Company, sufficient water is available (though limitations may be put on ship passage in an intensely dry season). The Panama Canal Company's estimates of future ship traffic through the Canal indicate, however, that means must be found to augment the opera- tional water supply of the Canal system to meet that demand. Among several proposals for water augmentation is the pumping of sea water into the Canal system to replace water lost in locking ships through. This method would end the Panama Canal's effect ivenes.'? as a biological barrier and, by introducing sea water into Gatun Lake convert the existing canal into a partly saline tunnel through which marine organisms could pass from one ocean to the other. It is ironic that for the past 30 years, the biggest opponents of a sea-level canal were not the biologists or the environmentalists, but rather those people who are convinced that we slinuld not give up the Canal Zone. They advocate keeping the Panama Canal Treaty intact and modernizing the Canal with something called the Terminal Lakes-Third Locks Plan. According to a sea water pumping environmental study by the Panama Canal Company in 1973 : "In the event that the 'third locks' system for larger ships were adopted, then sea water, pumping at a rate considerably higher 365 than any amount anticipated for the present locl^s system would become man- datory." It is uncertain Iiow much sea water pumping would he necessary with this plan. Biologists have warned, however, that we could achieve the effects of a sea-level canal without actually building one. The intermixing of species would occur more slowly, but just as surely if the .salinity of Gatun Lake were increased. The effectiveness of the present system as a barrier to migration of marine life between the oceans would be lost. In its consideration of the matter the Panama Canal Company listed sea water pumping only as a last resort. A third locks .system is not 'part of the Panama Canal Long Range Development Program, although excavations for it were made prior to World War II. Instead the Panama Canal Company has embarked on a program of deepening the Canal channel and dredging Gatun Lake to a greater depth, thereby allowing deeper draft ships and increasing the water storage capacity in the lake. THE 1970 CANAL STUDY For an example of how bioenvironmental research has fared to date, we need to examine the last major interoceanic study, completed in 1970. [Mr. Ortman described a number of earlier studies, but NMA regretfully omits his discussion of them for lack of space.] The Atlantic-Pacific Interoceanic Canal Study Commission (the Commission) was authorized by Congress in Septem- ber of 1964. The Commission's assignment was to determine the engineering feasibility of constructing a sea-level canal either by conventional means or using nuclear excavation techniques to be developed by the Atomic Energy Commission. Out of the approximately $24 million budgeted for this study the AEC's research progrnm, begun in 1965, totalled $3 million spread out over five years. According to Science (10 June 1969), the money was contracted out to Battelle Memorial Institute for radiological studies of the safety of nuclear excavation. By comparison, the Smithsonian Institution's ecological research, initiated in 1967, was funded at $55,000 and at $73,000 in 1969. Millions for engineering, pennies for biological research. It is instructive to note that Battelle, a regular research contractor for the AEC was asked to make a study of potential ecological effects where as the National Academy of Sciences was merely asked to recommend a program of future research to be accompli.shetl before, during, and after the construction of a sea-level canal. The National Academy of Sciences reported that "considering the grave po- tential dangers of interoceanic migrations of plants and animals, it is es- sential that migration be prevented so far as possible by installing the most effective barriers that can be devised." The Battelle report, on the other hand, found "no evidence for predicting ecological changes that would be economically deleterious to comercial, sport or subsistence fisheries" and "no evidence to support the prediction of massive migration from one ocean to another followed by widespread competition and extinction of thousands of species." According to a Science article of January 29, 1971: "The [National] Acad- emy [of Sciences] group disagrees completely with some of the conclusions of the Canal Study Commission and of Battelle. Whereas Battelle found it only "highly improbable" that the sea snake might get through a sea-level canal, the Academy group said the poisonous snake, "should have no real difficulty moving through a .sea-level canal." The canal itself would provide "a nearly optimal habitat" for certain large Pacific sharks and these sharks "could become rapidly established on the Atlantic coast of Central America, unless an effective barrier is employed" the Academy concluded. And whereas Battelle said it found no evidence that commercial or sport fisheries would be affected, the Academy report warned that some species, in- cluding certain shrimp, could be replaced by economically less valuable species. [Ernst] Mayr [Professor of Zoology at Harvard University] told Scievee it is "an indefensible statement" to say there will l)e no adverse effects on fish- eries since no one really knowns Avhat will happen. The Academy group also Avarned that a sea-level canal might allow passage of parasites and pathogens from one ocean to another where they might cau.se serious destruction of organisms that lacked natural resistnnce to them. Mayr's general impression of the canal commission's report is that it has made a number of "casual" and "misleading" statements, and that it has set up some straw men and then knocked them down while ignoring the most important fears expressed about a sea-level canal. 366 In tlu' introduction of its report to the Conunission, the National Academy raised a nnniher of otlier points. It said, "To foi'ego the relevant biological research prior to and during construction of a new canal would be like pre- paring to put a man on tlie moon and neglecting to aslc him to make scientific observations and collect samples. A new canal will affect the animal and plant life of tlie two oceans, but what these effects are cannot be determined unless the nature of tlie difference between the biota and ecosystems of the two ocean.s- are first carefully established thre created by a heat plume from a nuclear power plant, but biologists recommend that such a heat barrier extend for ten to 20 miles. The energy and cost required to lieat such a volume of water would be prohibitive. Using Gatun Lake to flood the central segments of Route 10 to form a fre.sh water barrier has not been adequately researched. THE STATE DEPARTMENT'S EIS In September 1972, The Department of State published regulations con- cerning ]u-0(edures for comjiliance with the Nationnl Environmental Policy Act. Analysis of these regulations is enlightening. First, they require that the State Department consider the environmental effects of proposed actions and tlint reasonable alternatives be considered whether or not an environmental statement is filed. Second, in the case of international agreements, draft 367 statements will, where possible, normally bo prepared, circulated for com- ment, and forwarded to the Council on Environmental (Quality prior to the conuuencement of negotiations to produce a linal agreement. According to a memorandum prepared by the 8taff of the House Subcom- mittee on Fisheries and AVildlife Conservation and the Environment, the State Department should have begun preparation of an EIS in 1!)73 when negotiations leading to the treaty began, instead, as late as July 22, 1977, the State Department wrote it had "not as yet made a determination' as to whether the action in (]uestion will significantly affect the (piality of the human environment within the meaning of the National Environmental Policy Act. . . ." The State Department subseciuently did issue an impact statement on the treaty — ten days before President Carter's treaty signing ceremony. Turning to a consideration of construction of a third lane of locks or a sea-level canal, the draft EIS quotes extensively from the Atlantic-Pacific Interoceanic Canal Commission report of 11)70. The only new material to be included follows: "At the time the Interoceanic Canal Commission's study was published, its environmental conclusion.s — summarized above — came under criticism from a number of environmental and scientific groups. "The White House has recently asked the National Academy of Sciences to do a two-month study which would update the 1070 environmental studies on a sea-level canal in the light of research and environmental policy changes since that time. "There have been no studies* and surveys on the environmental impact of the construction of a third lane of locks to the present canal. "It is premature to tell whether the United States will avail itself of the rights granted under the proposed Treaty and exercise these options for addi- tional construction. At such time as matters come up for decision, there will obviously be a need for extens'ive environmental studies." This last statement needs to be examined critically. It assumes that final engineering designs and environmental and biological studies can take place simultaneously. But as Sidney Galler, Smitlisonian Assistant Secretary for Science, said in 1900, bioenvironmental research would cos't between $2.") and ^."iO million over a period of 15 to 25 years. Tf, as the EIS suggests, we wait mitil a decision to build a sea-level canal is made before undertaking extensive environmental studies, the studies needed will undoubtedly be compressed, underfunded, and given short shrift in tlie end. SEA LEVEL ECONOMICS Having looked at a sea-level canal from the engineering and environmental standpoints, what about the economics of such a billion-dollar project? As- suming that we now have a higher awareness of the risks of nuclear excava- tion and do not seek out an agreement with Panama for its use, and assuming that Route 10 is the most feasible, is such a project economical? The first thing we must do is convert the cost into 1077 dollars. In 1070. the Corps of Engineers estimated Route 10 at $2.8 billion. Using the Corps' updated figures, a sea-level canal, as proposed in 1070 now costi? $5.8 billion. It should be obvious that as in the case of the Alaskan pipeline, cost over- runs and the like could 1)0 expected to add considerably to that figure. Two experts on the finances of the Canal told tlie House Panama Canal Subcommittee in July 1077 that a new sea-level canal would not be economi- cally feasible now. Dr. Stephen R. Gibbs of the Institute for ^Marine Studies at the University of Washington, who had analyzed the economic value of the existing canal as well as the economics of several proposed impi'ovemont proj- ects while studying at MIT, testified before the Sul)Committeo July 25. 1077, that "even the least costly conventionally constructed [using no nuclear ex- cavation] sea-level canal . . . would be a net economic loser for whoever un- dertook it." Leonard J. Kujawa, an accountant with Arthur Anderson and Company, which has been a consultant on financial and accounting matters for the Panama Canal since 1002, said a new canal would be "poor from an investment standpoint." Amortization of capital cost of a sea-level canal would be especially sensitive to trafl^c growth rates and average annual interest on the debt. THE ALASKAN OIL CONNECTION Since the 1970 studies and suggestions two e^-ents relevant to the canal question (among others) have occurred: the Arab oil embargo and comple- tion of the Alaskan pipeline. Because of decisions made concerning the dis- 368 tribution of oil from the North Slope, the US is faced with an oil glut on the West Coast while other regions of the country face an oil deficiency. Current proposals for shipping oil to these regions, brought down by tankers from Valdez, Alaska, include the Northern Tier Pipeline (across the north- western and nortlu-entral tier of states) ; rhe SOHK) pipeline (off-loading at Long Beach, California, with a new pipeline hookup in the Southwest) ; off- loading oil to smaller ships, transiting the Panama Canal, and continuing up to Gulf and East Coast ports ; and shipment around South America. In a report to the Senate Committee on Environment and Public Works dated July 1977, entitled "The Panama Canal — A Reexamination," Senator Mike Gravel of Alaska predicts that : "The probability that large quantities of oil will be recovered from the Alaskan Gulf, National Petroleum Reserve No. 4, and other areas of Alaska, both on and off shoi'e, is very high. ... As these Alaskan oil and gas reserves are brought to production, a sea-level canal should become increasingly attractive." Calculations by Arthur D. Little, Inc., for Senator Gravel indicate that the cost per barrel for transporting oil from Valdez to Panama via 165,000 dead weight ton tanker transshii)ment by lightering to smaller ships, crossing the Panama Canal, and continuing to Houston, at ?2.46 per barrel of oil. By com- parison, the cost of transporting oil around Cape Horn is estimated at $3.14 per barrel (via 265,000 dwt tanker). Calculations by Arthur D. Little, Inc., of costs using a sea-level canal are between $1.75 and $2.18 per barrel of oil. Senator Gravel believes that a sea-level canal would also enable the US to meet the natural gas crunch with Alaskan gas being sent by liquid natural gas (LXG) ships through a 53-mile-long ditch in Panama to reach the East Coast. Does this make a sea-level canal economical, however? While the above figures may tend to indicate that shipping oil through a sea-level canal is competitive with pipelines, economic analysis has not been done to show how much oil would need to pass through to generate tolls that would help pay for the canal. Senator Gravel has testified that : "First off. the environmentalists — and properly so — take a concern with any sizable industrial economic activity be- cause they want to know what the harms, the tradeoffs, and what the benefits are. I think that is very fine. That is the reason why I am asking money to go to the Corps of Engineers to do a proper environmental study. . . ." Such environmental concern was not evident in Senator Gravel's report to the Com- mittee, which fails to mention even once the biological concerns addressed by the National Academy of Sciences. In fact, environmental considerations were totally ignored. The Gravel report's conclusions include : "The construction of a sea-level canal across Panama appears to be a very viable and cost- effective alternative for moving Alaskan oil and gas surpluses to markets on the east and gulf coast. Such a canal could also .save the United States costly new investment in energy supply infrastructures, provide important foreign policy flexibility, and greatly enhance our defense capability while simul- taneon.sly reducing defense costs. These advantages which could accrue to the United States through construction of a .sea-level canal make it well worth our while to maintain the good will of the Panamanians, which I feel certain can be done if we secure a fair treaty." Each of these conclusions needs to be examined in turn. 1. "The construction of a sea-level canal across Panama appears to be a very viable and cost-effective alternative for moving Alaskan oil and gas. . . " Comment : According to Mr. Kuiawa, commercial vessels now constructed or soon to be built are designed for the purpose of avoiding transit of any canal for the reason that it is more economical to route them around Cape Horn or the Cape of Good Hope than to pay tolls. 2. "Such a canal could also save the United States costly new investments in energy supply infr.n structure. * * *" Comment : The oil flow out of Alaska will probably require new investment in pipelines anyway. And there are better ways of saving the US money in new energy supply infrastructures than spending $10-20 billion on a .sea-level canal. Friends of the Earth has been promoting alternatives to high technology and the waste of fossil fuels in the I'^S. How much insulation and solar space and water heaters would the money spent on a sea-level canal buy? How many homes could be retrofitted to burn less oil? 3 "* * « provide important foreign policy flexibility. * * * " Comment: Again, there are better ways of reducing our reliance on foreign oil and gas than a mammoth public works project in Panama. I 369 4. ". . . and greatly enhance our defense capability while simultaneously reducing defense costs." Comment: Only 13 US military vessels, the large aircraft carriers, cannot use the existing canal. In the nuclear age, a sea-level canal could be put out of commission just as easily as the existing canal. And as Dr. Gibbs makes clear in his testimony before the House subcommittee, if one considers the sailing time (via canal) of various naval task forces from regions where they normally are stationed to where they might be needed, the improvement in response time is small or nonexistent. Naval forces already in the Atlantic are closer in time to any Atlantic trouble spot than naval forces stationed in the eastern Pacific Ocean by about 7.5 days. For emergencies in the Pacific, an Atlantic Fleet would beat a Pacific Fleet only to a region in the South Pacific near western South America (with a time advantage of about two days). It is diflScult to see how a sea-level canal would improve the strategic situation appreciably. In addition, the estimate of 2.8 billion dollars in 1970 (5.8 billion in 1977) was based on passage of 150,000 dwt vessels, not giant supertankers. Any increase in the depth or width of the canal design would mean increased ex- cavation costs. Where does the support lie for a sea-level canal? Besides Senator Gravel, President Carter, and Secretary of State Vance, who advocates the colossal construction project? Well, engineering-industrial groups for one, manufac- turers of heavy earthmoviug machinery, dredging combines, and contractors. For example, in 1965 the Bucyrus-Erie Company of Wisconsin, supplier of 77 out of the 102 steam shovels used to build the existing canal, prepared a bound booklet entitled "A New Canal" and presented it to members of Congress. It boasted that "More B-E machines are rearranging the face of the world than any other make." A company that produces mammoth shovels (which can dig a 200-ton load and dump it more than a city block away) would be expected to push hard for a new canal. ENVIRONMENTALISTS' RESPONSE Friends of the Earth took note of this project even before the Canal Com- mission published its 1970 report. In 1975, when it became apparent that the sea-level canal was still being pushed by the State Department negotiators. Friends of the Earth and nine other national and international environmental groups sent a telegram to President Ford stating in part: "The undersigned organization believes it would be premature and reckless to enter a new- treaty with Panama that would authorize or permit construction of a sea- level canal." This telegram, sent on April 8, 1975, was sent in the hope that the Ford Administration would drop the project once and for all. The Panama Canal Treaty became such a hot political item in the 1976 Presidential campaign however, that President Ford put off any further work on the treaty until after the election. Soon after President Carter took office, environmentalists went to work urging that environmental concerns should be considered in the treaty and that the sea-level canal project should finally be laid to rest. Friends of the Earth kept in touch with White House and CEQ staff from March 1977 onwards, as the Administration looked into the issue. Letters to the White House drew the response from Katherine Fletcher of the Domestic Policy Staff in June 1977 that "You can be assured that the Administration would not be lightly led into the support of this multi-billion dollar project." A month later Presi- dent Carter and Secretary of State Vance were apparently led into support for the sea-level canal by Senator Gravel. For on .July 21, 1977 at the Presi- dent's "town meeting" in Yazoo City. Mississippi. Carter advocated the con- struction of a .sea-level canal. This was shortly after Gravel had met with Carter at the White House. In August, the CEQ recommended that a study of all current information on the issues be quickly pulled together. At the request of the White House, the National Academv of Sciences was asked to assemble all the biological and ecological data gathered since 1970 by the end of September— two days after comments on the State Department's Draft EIS were due. The Academy ap- pointed a committee that met in a three-day .session. But it could bring to light little new substantive information because there had been little or no funding of the studies the Academy had recommended in 1970. 370 Soon afterwards, the original ten environmental groups, joined by one other, sent another telegram, this time to President Carter on September 6, 1977, pointing out that "recent reports on the State Deparment's negotiations with Panama foncerning tlie interoceanic canal indicate that a serious environmen- tal issue is involved. . . . The undersigned organizations believe the State De- partment should not inject the sea-level canal issue into the current treaty negotiations with Panama, centering as they do on questions of sovereignty and administration of the present canal." On September 7, 1977, before the Academy's committee had time to report, ten days after the State Department had released the draft EIS on the Treaty, President Carter and General Torrijos signed the Panama Canal Treaty. With more engineering data than biological research on the table, a decision to move forward with a sea-level canal would be a decision made in ignorance. The Panamanians deserve to profit from the existing canal, not to have their country further divided and despoiled. Ultimately, the question is one of self-resti'aint, and of reexamination of the values and assumptions used to promote the sea-level canal. Text of a telegram sent to President Carter by eleven national environmental organizations on September G, 1977, the latest of a scries of eontacts with the Furd and Carter Administrations urging that a sea-level eanal be dropped fro>n treaty negotiations. Mr. President : Recent reports on the State Department's negotiations with Panama concerning the interoceanic canal indicate that a serious environmen- tal issue is involved. The negotiators for the United States have included a provision in the Panama treaty that would grant the United States a long- term oi)tlon to build a new interoceanic sea-level canal and require that a report be made on the feasibility of building such a canal. Conservation and environmental organizations voiced their opposition to a Panama sea-level canal to President Ford in 1975. We regard a treaty pro- vision of this kind as prejudicial to the thorough, rational consideration of the issue. Neither the Congress nor the several relevant agencies in the Executive Branch have approved it or even seriously considered the matter. The State Department has never been authorized to negotiate for a treaty provision on the sea-level canal. Their Environmental Impact Statement on the Treaty comes far too late for us to make any meaningful response before the Treaty signing ceremony tomorrow. There are important reasons for our concern. Marine scientists have re- peatedly warned against a Panama sea-level canal (as well as salinization of the current canal system), on the grounds that a canal of this design would eliminate the present freshwater barrier to intermixture of the two distinct ecosystems on either side of the Isthmus of Pannma. Should this freshwater barrier be eliminated, by pumping sea water into the existing canal, for ex- ample, the result could be tremendous damage to the fish and other marine organisms of both the Atlantic and Pacific Oceans, with con.sequent impact on the large buninn populations that depend on the seas in this part of the world. A National Academy of Sciences Panel on the sea-level canal in 1970 warned of "grave potential dangers" that could result from such a project. The panel said : "Joining two oceans with a sea-level canal is a gigantic natural experiment. Its consequences are iniforeseeable. To forego the relevant biological research prior to and during the construction of a new canal would be like preparing to put a man on the moon and neglecting to ask of him to make scientific obser- vations and collect samples. A new canal will affect the animal and plant life of the two oceans, but what these effects are cannot be determined unless the nature of the differences between the biota and ecosystems of the two oceans are first carefully established through years of intensive research." The results of the National Academy of Science's current attempt to quickly pull together all new information on the issues concerning a sea-level canal merely dociunent the fact that the biological studies reconnnended in 1970 have never been carried out. Advocates of the sea-level canal claim there is a technological solution to the problem of biological exchange, but no solution has yet been proi)osed in sufllicient detail to allow evaluation of its effectiveness. All the proponents have to offer is vague promises. 371 The undersigned organizations believe the State Department shonkl not in- ject the sea-level canal issue into the current treaty negotiations with Panama, centering as they do on questions of sovereignty and administration of the present canal. A sea-level canal provision in a treaty would not only preju- dice later consideration of the merits of the project, but it would also lead Panama to expect the United States to build a new canal, even though no decision has yet been made on it by this country. Dr. Stephen II. Gibbs, an economist for the I'niversity of Washington's In- stitute for Marine Studies, said in testimony l)efore a House Panama Canal subcommittee that a new canal "would be a net economic loser for whoever undertook it." The sea-level canal represents not only an economic loss but a likely en- vironmental disaster as well. We strongly urge you to instruct the Secretary of State to cease negotiating for a sea-level canal provision as part of any treaty with Panama. John W. Grandy IV, Executive Vice President. Defenders of Wild- life; Peter Harnik. Coordinator, Environmental Action, Inc.; Brent Blackwelder, Washington Representative, Environmental Policy Center ; Douglas W. Scott, Northwest Representative. Federation of Western Outdoor Clubs ; David R. Brower, Presi- dent, Friends of the Earth : Lewis Regenstein, Executive Vice President, The Fund for Animals, Inc. ; Sir .John G. Ward, President, International Society for the Protection of Animals ; Jack Lorenz, Executive Director, Izaak Walte governmental nature of such organizations as lOCARlBE and WECAFE, the use of a nonpolitical, private organization is desirable. For years the University of ^liami has supported the Gulf and Caribi)ean Fish- eries Institute. This organization is now considering expansion of its area of interest to include marine sciences, generally including related problems, and to include the Pacific Coast of Tropical America. Fisheries. Industry, Tourism, Resource Development, Pollution and Socio-Economics are often .so interrelated that such an exi)ansion is logical. Such an expanded Institute coidd provide the forum needed for discussion of Coastal Zone problems in Latin America. The University of Miami has a Technology Transfer Program that will 32-461 O - 78 - 25 380 permit a broad approach to coastal problems, family health care, transporta- tion, tourism, and international law, both with regard to education and re- search. Because it is a flexible program rather than an organization, it can also involve experts in other subject areas from other institutions on a sub- contract basis. Initial programs within the University to instruct a core of faculty in languages such as Spanish have been completed at the School of Marine and Atmospheric Science and will be continued in the Fall. Finally, the University of Miami envisions the need to maintain and expand its library and collection resources to assist .scientists from the lesser developed countries in furthering their research ; in short, to develop an international marine science information center. For the libi'ary, this means adding a computer terminal linked to data banks, the expansion of existing printing and copying services, and the addition of personnel to process and distribute the data as requested. Such a terminal must be in the United States due to the linkage required for U.S. data banks. The collections of tropical animals now preserved at the University need to be curated and made avail- able to qualified scientists in Latin America. Latin American scientists may wish to seek a visiting scientist program to enable them to use these resources, as well as those at other institutions in the United States. In education, as in i-esearch, the University believes that technology trans- fer requires cooperation with personnel in the cooperating country from the outset. Programs should be developed at planning sessions in the country in question, with the participation of the appropriate oflScials and scientists of that country. Aside from pilot programs that receive U.S. support, funding should come from the country itself (government, industry, business or private funds) or from suitable foundations such as Ford or Rockefeller, or from organizations like the World Bank, the Organization of American States or the Interantional Sea Grant Program. If there is to be a meaningful transfer of technology to the lesser developed countries, those countries must be provided not only with trained technical personnel, but with the means to train their own personnel in the future. This is the role of education. The types of program outlined above offer a much more effective means of supplying these needs in a short period of time than the traditional graduate degree granting programs. Questions of Mr. Nonnenmacher to Mr. Robins 1. AVould you please expand on your answer to my question during the hearing by submitting any technical data you have, or may be able to obtain, regarding the pulsing of Pacific tides through the projected sea -level canal? 2. Colonel Sheffey testified to the effect that over the years that the Canal has been opened probably hundreds of millions of tons of Atlantic and Pacific Ocean waters have been interchanged by the taking on and discharging of water ballast by empty ships entering and leaving the Canal in either direction and that, therefore, many forms of marine life have been transported from one ocean to the other. Responses of Mb. Robins to Questions From Mb. Nonnenmacher 1. I do not recall your questioning me concerning the pulsing of Pacific tides in the sealevel canal. However, detailed information was provided for Route 10 on pp. v-22ij to v-230 in the Interoceanic Canal Studies 1970. Figs. 20-lb, -lb, and -Ic show the location of tidal gates designed to limit tidal currents to less than 2 knots. Without such gates such currents would probably reach or exceed 4 knots. This is not my area of expertise, nor am I an engineer, but I would expect a ship sailing with such a current to experience difficulty in maintaining steerage. The same report provides similar information for route 14 which I gather is not under serious consideration since it crosses the existing canal. 2. Empty ships and those sitting too high in the water take on suflficient water to improve their steerage in transiting the canal. The quantities of water involved are very large. As I understand it, the water taken on is from relatively clean areas out from the harbor entrance. Screens over the intakes are usually very coarse and are also often broken, rusted out or otherwise defective. Unquestionably, large quantities of eggs and larvae of marine 381 organisms are taken into the ballast tanks to be expelled immediately after departing the canal tenninns. No one has really studied or sampled the balhst water to determin numbers and survival of organisms involved th(mgh I have repeatedly called attention to this need. The view that all organis:ns so transported die in transit is surely naive. A tish of the family Eleotridae has been transported to ranama from the Near East and is presumably established in the canal region. A small blenny was trani?i)orted in the latter part of the last century from the Indian Ocean aroiuid Africa to Trinidad and is now common along the southern Caribbean. If fishes can survive such long transit times, the short time in transiting the canal in l)allast water should pose no problem. Also, fishes live in and around fouling organisms on the hulls of ships. The small local freighters that go from Ecuador or Costa Rica to Carib- bean ports are often very heavily fouled. The important point to this discussion is that there has not been widespread establishment of Caribbean animals in the eastern Pacific or vice versa. Thus, this supports our contention that the transport of eggs and larvae through a sealevel canal will not result in establishment of these species in the other ocean. Conditions on the two coasts at the Canal Zone are markedly different. In short, I do not believe that there would be the large envii'onmental impact predicted by some biologists should a sea-level canal be built just as there has been none of consequence from ballast water exchange. Fishes that would indeed use the canal would be adults and juveniles of species of estuarine and bay waters, species that used the last natural connections across the isthmus. Some of the.se use the present canal (tarpon and snook, for example) and most will use the present canal when it is converted to a saltwater or brackish system. Mr. Metcalfe. Thank you very much. Now we will hear from Mr. David Ortman, Avith a summary oi his statement. Mr. Ortman. Thank you. I realize the time constraints you are under, as well, so I Avill summarize the main points. I did want to express our appreciation to Mr. Murphy, the chair- man of the full Merchant Marine and Fisheries Committee, for his willingness to hold these hearings, as he indicated were necessary back in November, and also our appreciation to you. Chairman Met- calfe, for your concern you have shown for these hearings, these past three hearing dates. Basically there are three ecological eft'ects that we want to focus on, the first being that freshwater of Gatun Lake is really the only known effective biological bam-ier between the two vast living marine systems in the Atlantic and Pacific. The biological barriers which have been proposed : bubble curtains, the electrical wires, the ultra- sonic screens, really border on fantasy. This is why the possibility of seawater pumping, as Dr. Eobins mentioned, into Gatun Lake, as well as the deforestation question is also of such crucial concern to us. I just received a copy of a paper from Dr. Frank Wadsworth of the institute of Tropical Forestry, in which he mentions that lake — my Spanish is not too good — Alajuela, which is formed by the Mad- den Dam, has been sedimented by deforestation to a depth of 25 feet in some places, and has already lost more than 5 percent of its active storage capacity. We believe that this is an issue which really needs to be covered in a different setting, and would encourage, if you have an interest in this area, to focus on this at a later time. If the watershed is not maintained, the Panamanians may be forced into seawater pumping, with the resultant lowering of the effectiveness of the freshwater barrier. 382 Second, the possible ecological effects extend far beyond the sea snakes — which you may have heard of. These have been listed in our outline, as well as in a memorandum that the Council on En- vironmental Quality has put tooether. That is also in the attachment. Also I wanted to bring to your attention that attached to our statement is a shoit memorandum from the Norwegian Association for Ecology, which also expressed concern about the effects that could extend in a more distant sphere than merely the Caribbean itself. And that has been attached. The Norwegian Association for Ecology, yes, which has made this point well. I wanted you to know that Friends of the Piarth, which was formed in 1969, has taken an interest, very active interest in this since the 1970 study came out, because of the controversy due to the environmental studies that had taken place, which we felt had not been carried out in a very extensive way, and the controversy that extended between the Batelle Institute and the National Academy of Science over how extensive they were. We were able to get other environmental organizations, both national and international, to join with us in asking both President Carter and President Ford, basically, to remove the sea-level canal idea from the treaty negotia- tions with Panamanians. That did not take place. Senator Gravel was instrumental in getting this placed in the treaties, and when the Gravel amendment came before the House, in its navigation bill form, 10 other environmental groups joined with Friends of the Earth to oppose this amendment at that time. The letter signed by the environmental groups is also attached, for your information. I wanted to focus just very brieflly on what we see are the fatal flaws in the Gravel amendment. First, the mechanism for selection of joint commission is totally unacceptable. It seems that the clear purpose is to assure the Senator's placement on such a com- mission. We agree with Ambassador Popper, in his remarks, that Panama must be allowed to select their own members of such a commission. That only seems fair. And we believe that the President should ap- point the U.S. commission members from private life. The amendment does not specifically rule out the examination of nuclear excavation. We recommend that any update of such a report examine only nonnuclear means, that we are not sure that such update would not look at this, because this is what the 1970 report did look at. I believe Congressman Murphy's bill, original bill, that he intro- duced in November, did specifically rule this out. AVe would like to see that back in any such proposal. Senator Gravel has overlooked, or minimized, what we view as the secondary environmental impact of such a project. Among these, which we really feel are important and should be studied, are the effects on world oilspills due to increase in supertanker size, the effects of critical oilspills in the canal itself, the possibility of wiping out the Panamanian fisheries may more than take care of many of the benefits of a supposed canal from oil shipment, the effects on U.S. ports due to increasing dredging due to supertankers — and something that probably has not been talked about very much, the 383 effect on the terminal cities: I'anania City, J^alboa, and ('oloji, that would be impacted if you took all the trallic and all the support facilities oli' and moved them 10 miles uj) to where there are no su[)port facilities now where a sea-level canal would exist. You wouhl simply bypass all these support facilities that exist — for example, the tourist trade, financial, and social services. These are secondary social and economic impacts that shoidd he looked at. Turnino- to what we see as an alternative and a plan that would take care of these objections — basically, in listenino- to the testimony, several thino;s stand out. The recently ])assed treaties call for a joint Paiuima-I'nited States sea-level canal study sometime durinureau of Commercial Fisheries." The decline in U.S. fi.sheries is general knowledge. This decline resulted in the 1976 Fi-shery Conservation Act which established the 200 mile jurisdiction 386 over U.S. coastal waters. That act calls for establishing fish catch quotas by species, based on ecological optimal yield. Conversations with the National Marine Fisheries Service confirm that knowledge of habitat reiiuirements. tolerances of salinity and temperature, life histories of marine species would be of tremendous aid to fisliery manage- ment as mandated under the Fishery Conservation ;Managenient Act of 197"). These are of course, the type of data to be generated in a thorough l)iological study for a sea-level canal. Such knowledge would improve fishery manage- ment by identifying the seasons and areas for spawning of fishery siiecies, the life span and reproductive cycles, and migration patterns. The second use of environmental baseline studies is knowledge of the effects of biological interchange between the two oceans, as they relate to saliniza- tion of Gatun Lake and construction of a third set of locks as provided for in the treaties. While Thomas Constant, the representative of the Pananm Canal Co. indi- cated in his testimony to the Committee that the salinization of tlie present system is not now being projected, that possibility has been under discussion by the company. At the present time sea water dumping is not economical, according to Mr. Constant, however, as canal traffic increases, the economics of the propo.S'al may be expected to change. We should have information on whicli to base a decision regarding environmental effects of salinization. Dr. Richard Robins, in his testimony before the Conunittee, also emphasized the need for biological data prior to conversion to salt or brackish water. Finally, we would also mention the benefit to medical .science which such studies would provide. Scientists have in recent decades turned to living orga- nisms as a source of materials to fight disea.ses. A widely cited case is the 1928 discovery of Dr. Alexander Fleming who found that bacteria would not grow in cultures contaminated with tlie common mold penicillin. Just over a decade later, antibiotics came into wide u.se. Thirteen yeiir.s' ago the substance Arn-A. extracted from a Caribbean sponge called Crytotethia crypta was identified by French scientists as pre- venting tlie growth of a deadly virus whicli causes eiiceiihalitis and is usually 70 percent lethnl. A year ago, the National Institute of Health an- nounced that based on this discovery, a major breakthrough had been made in treating viral diseases similar to the development of antibiotics. Ara-A is now l)eing synthetically produced commercially. Environmental studies on the ecology of the Isthmus could identify similarly useful species. Compared to the cost of sea-level canal construction, estimated at from 8 to 12 billion dollars, the amount for environmental studies is small indeed. Whatever the outcome of the decision on that canal proposal, the funds .spent for environmental studies will not be siient in v;iin. 2. Do you believe that studies on the ecological effects of a sea-level canal should he done in connection with any implementation of the Panama Canal Treaty, or should studies begin independently? There are more arguments in favor of an early start for the ecological studies than for waiting for implementing legi-slation, since several years are required to conduct adequate studies. Questions of CHAIR^[AN Metcai.fp: for David ORT^rAN 1. Col. Sheffey feels that there are diminishing marginal returns associated with tlie increased expenditure of funds for in-depth environmental studies. What are your comments on Col. Sheffey'.s view? 2. Do you believe th.-it studies on tlie ecological effects of a sea-level caiinl should be done in connection with any implementation of the I'anama Canal Treaty, or .should the studies begin independently? RESPONSES 1. Col. Sheffey's views in general indicate little consideration of the environ- mental effects of a sea-level canal. The fnct is, very few baseline environ- mental studies in Panama have been carried out. The studies reconHiiended by the Smithsonian would be useful not only in determining the possible im- pacts of a sea-level cannl but would also iirovide much of the sniiie informa- tion needed to determine the effects of the possible saliniz:itioii of (Jatun Lake. The resiUts of these in-depth environmental studies would be of great 387 value to the Joint P>olojiit'al Conimissioii !set up by the raiiaiiui Treaty to (leal with environmental problems. 2. Imitlementation of the Tanama Canal Treaty does not automatieally ve- quire that a joint study of a sea-level canal be carried out immediately. This study could take place anytime within the life of the Treaty. As mentioned in our testimony, it luis lieen our position that there is a vast wealth of data on the engineerins;- and route evaluation s-urroundinj;- a sea-level canal. What is essentially lackinj;- is an indepth asst'ssment of the environmental effects of such a project. We recommend that environmental studies he undertaken far enough in advance of any decision to proceed with further ensineeriuK studies in order that environmental impacts can be taken into consideration. We would prefer to see them done in this manner whenever Article XII of the Treaty is acted on. Mr. ^Metcalfe. So with that, 1 am going to adioiirii the hearings, and express my thanks, both to all of the witnesses, and to yon, for remaining, and especially to the staff for their perseverance and their dedication, and the effort they have bronght forth to make these liearings as successful and as productive as they have been. Thank you very kindly. The subcommittee now stands adjourned. [The following was submitted for the record:] National AVildlife Federation, Washington, D.C., July 20, 197S. II(ui. R.vLi'ii II. Metcalfe, Chairman, Panama Canal Siihcominittce, Merchant Marine and Fisheries Com- mittee, Rayburn House Office Building, Washington, D.C. Mr. Chairman : The National Wildlife Federation appreciates this oppor- tunity to submit a statement for the record, on the subject of a sea-level canal. The Federation is the nation's largest, nonprofit, conservation organiza- tion with approximately 3,r>00,000 members and s'upporters. We have long been concerned about the potential dangers of a sea-level canal linking the Atlantic and Pacific oceans, and we hope that decisions re- garding this matter will not be made in ignorance of the possible conse- quences. Based upon expert testimony presented to this subcommittee, the National Wildlife Federation believes that there is time to adequately investigate the potential biological impacts of a sea-level canal before it becomes necessary to make a final decision. For this reason, we urge this subcommittee to initiate the enviroiunental studies as soon as possible. We feel that if these stiulies are not initiated soon, it is likely that future decisions will be made without adequate knowledge of the potential environmental effects. AVe would re- spectfully remind you that the National Environmental Policy Act of 1969 requires the federal government to consider environmental impacts during the decision-making process, and not afterwards. The Panama Canal Company has testified that traflic through the current canal will not reach capacity until "some years after the turn of the century." Assuming that "some years" means o or more years, a decision to develop an alternative would not have to be made until 1090 or later, since several experts have testified that a sea-level canal would take approximately IH years to construct. What we propose, therefore, is initiation of biological studies very soon, so they can be completed by 1990. In our judgment, it would not be wise to have economic studies completed years befoi-e the completion of biological studies. This subcommittee has been informed that the economic studies completed in 1970 are already outdated. Economic updates completed in the next few years would similarly be out- dated by 1990, and would therefore be a waste of taxpayers money. However, the data resulting from the recommended biological research would not beciune outdated, nor would the money spent for such research be wasted. In addition to being useful in the sea-level canal (piestion. the data would be valuable in improving fisheries management, and nuu'h of the in- formation would also be ])ertinent to the third lane of locks (piestion. During the course of the recent hearings, this subconnnittee lias learned that significant nund)ers of organisms have transited the canal in the bal- last water of ships, and that relatively few species have established them- 388 selves in the foreign ocean. We do not find this surprising and would like to caution this subcommittee not to interpret this as evidence that a sea-level canal would necessarily be safe to the environment. The small amount of ballast water transitting the present canal cannot be compared to the enormous amounts of water which would move through a sea-level canal. Furthermore, even though some organisms have made the transit, there are many potentially dangerous ones that have not. History has taught us that the great majority of birds introduced into the U.S. over the years have not established themselves here. Likewi.se, we would expect that most marine species adjacent to Panama would not successfully invade the foreign ocean. However, the danger exists with the relatively few species that would. There has been a great deal of speculation on the part of scientists and environmentalists as to the po.ssible disasters resulting from a sea-level canal, and there is good rea.son for it. Biologists have learned through the years, that the introduction of a foreign species is very rarely a wise under- taking. More often than not the losses are greater than the gains. Without adequate studies, we cannot predict what would happen with a sea-level canal, but we do know that the risks are great. Another danger of opening a sea-level canal through Panama, one which we feel has received too little mention, is the possibility of a major oil s'pill on the magnitude of tlie recent Amoco Cadiz spill off the coast of France. The coral reefs on the shallow Atlantic side of Panama po.se a substantial threat to .supertankers, which have extremely poor maneuverability. Supertankers would be particularly vulnerable there in a heavy storm. Mr. Chairman, we appreciate your consideration of our comments, and we would be happy to respond to any questions you may have. Sincerely, Thomas L. Kimbal, Executive Vice President. Statement of Herbert D. Vogel, Consulting Engineer I shall preface my statement by noting that were the existing lock canal across the Isthmus of Panama to be continued as a responsibility of the United States I would first study the cost and effects of increasing its ca- pacity by the addition of third and larger locks with ancillary facilities. This would involve among technical and economic considerations a thorough in- vestigation of ways to provide additional water for lockage, and that in turn would require studies of environmental effects if sea water were to be pumped, along with the requirement for additional lands if reservoir levels were to be raised. Since the recently signed treaty with Panama places the responsibility for future maintenance and operation of the present canal upon that country I shall limit my remarks to what I consider the desirability of bringing the sea- level studies up to date, stating at the outset that under present circumstances I see no compelling reason for it except as may be indicated by provisions of the treaty. Differing approaches to such a study have been indicated by Bills now before the Congress, and of these I favor the House version that proposes two steps, the first to consist of a survey by a Council of United States Nationals to assess the environmental hazards of such an undertaking, along with international implications, national security benefits and tech- nical problems that may be expected. The vulnerability of any type of canal is, of course, a matter for serious consideration. The question of optimum location has been practically settled by ex- haustive studies of the Atlantic-Pacific Interoceanic Canal Study Commis- sion and though experience might now suggest a location other than in Panama there is no practicable way to cross from ocean to ocean without transiting another country. If the study by a Council of U.S. Nationals should reveal definite advantages to this country or a need to comply with treaty obligations, then a detailed study by a joint commission would appear in order. Although special consideration must be given to matters of cost, future use, international relations", environmental risks and economic advantages — to say nothing of military implications — the basic underlying problems will be of a technical nature, requiring sound engineering judgement. I would urge, there- 389 fore, that the inembershii) of both the Couucil uiul Commission include a civil enjjineer of higli professional reputation. Questions or Mr. Nonnenmaciier and Answers by Herbert I). Yogel 1. Do you care to comment on the conflicting testimony regarding (he Pacific tides given by Senator Gravel on the one hand and by Drs. Jones and Challinor on the other? 2. On the matter of problems of steerage in narrow channels: (a) Senator (Jravel testified: " * * * But the whole steerage problem of large vessels confined to water like that has not been solved. That would be one of the outreaches of tech- nology that would be recpiired. It is not a serious problem — nothing that we do not think can be solved. But we do not have, unfortiniately, operations at this point in time to handle that kind of problem. * * * •■ Do you agree that it can easily be solved? (b) The 1970 Sea-Level Canal Commission made nine recommendations. No. 8 called for the completion of three investigations. The third of these was "Investigation into the hydro dynamics of large ships moving through confined waters with variable currents". In answer to my question. Col. Sheffey testified that such a study was unnecessary as part of the proposed updating study which is the subject of our hearings. Even though it was urged by the Commission he directed, do you agree with his conclusion? 3. Is this unsolved steerage problem in confined channels so important that it should be completely resolved l)efore even considering a sea-level canal? 4. Colonel Sheffey testified : "Building a third set of locks for the present Canal large enough for siiperships would be an irre.sponsible act. The cost would be two-thirds as great as for a sea-level canal for the same ships, huge operating costs and enormous water supply problems would ensue, and the critical military vulnerability of the lock canal would be unchanged. In ad- dition, future enlargement of locks is impossible, while a sea-level canal can be progressively enlarged to whatever capacity is needed in the future." Do you agree? 5. Except for attack by atomic bombs, which is the more vulnerable canal in your opinion, the sea-level canal or the locks canal as improved by the Terminal Lake/Third Locks project? 0. AVhich offers the higher degree of safety for the transiting of large ships? 7. Gen. Dolvin testified that each ship put through the Third Locks Canal would require 100 million gallons of water. (a) Do you agi'ee with this estimate? (b) If that amount is not already available in Gatun Lake, how and at what cost could this extra water requirement be reached? S. (a) What lock dimensions would be necessary to transit our 13 largest aircraft carriers safely? (b) Other than some increased cost, would there be any reason such locks could not be built as easily as the propo.sed Third Locks with chambers only 1200' X 140'? 0. Is not the term "sea-level canal" or even "tidal level canal" misleading? Could not the proposed canal more graphically be defined as a "tidal surge canal" or something similar to better convey the difficulties really involved? 10. In your opinion, does the need for tidal gates to equalize the 22 foot difference between Atlantic and Pacific tides practically make the proposed waterway another lock canal of a different type? 11. As an experienced engineer, have you concluded which of the two pro- pos-als, the Terminal Lake/Third Locks Project or the sea-level canal would be wiser course to follow? 12. If the former, do you see any value at all in pursuing any further sea- level canal studies? (1) The question of whether or not locks will be required in a sea-level canal to control the flow generated by tidal differences is a basic one to be 390 resolved by a comprehensive sea-level study. My opinion at this time is that witli so great a variance in ocean levels on the Pacific side, locks will be re- quired there. They will probably not be needed at the Atlantic end of a canal. (2) To be of any great value a sea -level canal should permit a two-way transit of ships. This leads to an opinion that the task is far more gar- gantuan most people have been led to believe. Safety will require considerable clearance between lanes and the embankments on each side, and there will be an incalculable amount of earth to be removed, considering the size of cut necessary and the inherent instability of the side-slopes. I doubt that anyone yet has come near a practicable estimate of cost. I do not agree with Colonel Sheffey that a study of hydrodynamics relating to large ship movements in confined waters is unnecessary as part of a new study. Such a determination will be vitally needed, for too little is known at this time about what dimen- sions may be needed for a canal that ships of great size may pass in. (3) The steerage problem should probably be imdertaken in a very early stage of the sea-level study. (4) Any talk about providing a third set of locks and a terminal lake for the existing canal is of little practical value now that the decision has been made to turn it over to Panama. I see no reason for the T'uited States to invest any more money in it under present circumstances. Also, before any important study is started to determine the mez'its of a sea-level canal across the Isthmus of Panama, the only practicable location, it should be clearly settled for all time — without grounds for future contention — that it will be wholly owned and controlled in perpetuity by the United States. If any chance should remain that Panama may one day make successful claim to it, the project should be abandoned befoi-e it is started. Colonel Sheffey is cori-ect in saying that third locks to the present canal would create a water supply problem and that the vulnerability would remain great ; also, that locks cannot be enlarged except at a cost comparable to rebuilding. (5) See answers to question 4. (6) Unless a sea-level canal is made large (wide enough) and kept at a high level of maintenance it will present more hazards to two-way traffic than a well opei-ated lock-canal. • (7) I have no way of checking the estimate of 100 million gallons of water required to put a ship through larger, third locks because of several in- determinates at this point. There is already a water problem, however, in the existing canal and certainly tliis would be greatly increased by installation of another set of locks. The several possible solutions include : (a) Deepening the cut, which has been done to considerable extent. (b) Raising Madden Dam. (c) Building one or more additional dams on arms of Gatun Lake. (d) Pumping sea water. Greater storage behind dams would result in flooding more land in Panama and pumping sea water would pose environmental problems. (8) I am not prepared to say what lock dimensions would be necessary to transit our largest aircraft carriers, but I consider this an academic ques- tion for the reason previously stated ; ie. since we will no longer own and control the lock canal it would be foolish to put more money in it. Larger dimensions than those previously contemplated for a third set of locks would open up a number of new problems, all resulting in greater cost but probably susceptible to solution. (9) I do not think it matters much whether we speak of a "sea-level canal" or a "tidal level canal" except that the latter term would probably be mis- understood by most people. Whatever you call it, it is still a sea-level canal at the Atlantic end. (10) A single lock to control a 22-foot difference in head at one end would hardly change the basic character of a sea-level canal. (11) A Terminal Lake-Third Lock Canal is no longer a viable option for us, for we no longer own the canal. A sea-level canal is technically feasible but its economic feasibility must be proved. I am so bold as to say it is "technically feasible, because I believe anything can be done if one is willing t«» pay the price. (12) Yes, I would pursue the sea-level canal study, but I would first de- termine what control the United States might have of it in perpetuity. 391 Statement of Capt. Miles P. DuVal, Jr., U.S. Navy, Retired Mr. Chainuaii, members of the Committee on Merchant Marine and Fij-h- eries, and guests : At the outset, I dedicate my testimony today to the gn at American leaders who formulated our Isthmian Canal policies in the early 20th century and are thus mainly responsible for giving the world its maritime gateway to the Pacific. The main purposes of this statement are to make four important points: First, that the Panama Canal needs major modernization ; Second, that an attempt toward such improvement was started in 1939 but suspended in 1942 ; Third, that there is a tested plan for major modernization on which iFlTl,000,000 has been expended; and Fourth, that this plan will provide the best operational canal practicable of achievement, including proposals for a canal of s"ea-level design. Because certain documents supply important information for the study of canal history and problems, I request that the following be appended to my statement : (1) Roosevelt, President Theodore. Message to the Congress Transmitting the Report of the Board of Consulting Engineers for the Panama Canal, February 10, 1906. (2) DuVal, Miles, P., Jr., "The Marine Operating Problems, Panama Canal, and the Solution." Am. Soc. Civ. Engrs. Proceedings, vol. 73 (Feb. 1947), pp. 161-74. (3) . "Isthmian Canal Policy — An Evaluation." U.S. A"av. Inst. rroecedings, vol. 81 (Mar. 1955), pp. 263-75. (4) "The Interoceanic Canal — A Problem." Explorers Journal, XLII (Dec. 1964), pp. 215-22. (5) "Panama Canal." Encyclopaedia Britannica, 1970, vol. 17, pp. 205-13; quoted in Congressional Record, vol. 117, no. 15 (Feb. 10, 1971), pp. S1207-15. (6) Randolph, E. Sydney. "An Engineer's Evaluation of Isthmian Canal Policy," U.S. Nav. Inst. Proceedings, vol. 82 (Apr. 1956), pp. 395-99. (7) . "Panama Canal — Proposed Improvement of Operating Condi- tions and Increasing Capacity," memorandum for the Governor, March 26, 1943 (unpubli.s-hed manuscript). As historically evolved, U.S. Isthmian policy has had two prime objectives : (1) The best canal site; and (2) The best type of canal. The decision as to site was made by the congress in 1902 following a dramatic struggle known as the "battle of the routes." The decision as to type was made in 1906 after another sharp contest known as the "battle of the levels." The three key leaders for the last were chief engineer John F. Stevens of the Isthmian Canal Commission, Secretary of War William H. Taft, and President Theodore Roosevelt. The first major improvement for the Panama Canal after opening to traffic was the construction of the ^Madden Dam and Power Project completed in 1935. That work increased the re.serve water supply for maintaining channel depths in Gatun Lake during dry seasons, supplied additional power for canal operations and reduced the danger of floods from the upper Chagres River. In addition to this project, canal engineers had long foreseen that the next step in canal improvement would be additional lock capacity and planned accord- ingly. PRESENT PANAMA CANAL GATUN LOCKS ^.,„, „,, ^^■^■^■^■■b ..-^ ' h^^ FLORES LOCKS 392 When World War II approached, the Congress, on administrative recom- mendations, authorized the construction of the 1939 Third Locks Project at a cost not to exceed $277,000,000. An undisclosed objective in that project was "conversion" of the existing Panama Canal to "sea-level," which has not been specifically authorized in the statute. ^v"* CRSTOBAL PRESENT CANAL & 1939 THIRD LOCKS PROJECT (BY PASS PLAN) Hurriedly considered during those pre- World War II days of hectic activity without adequate consideration of the operational aspects of the problem at a time when there was fear of bombing attacks, this project provided for an additional set of larger locks a short distance away from existing locks and joining them with existing channels by means of new bypass channels. It is important to realize that this authorization was not enacted until after the ratification in 1939 of the 1936 Hull-Alfaro Treaty. That treaty provides for "expansion and new construction" for the existing canal (Cong. Rec, July 24, 1939, p. 9834). The 1977 Panama Canal Treaty provides for construc- tion of a "sea-level canal or a third lane of locks." (Cong. Rec, Feb. 8, 1978, p. S1510.) ■- ''^'^- *S:^;^'^\*^<'*^^■^- i*H^^^^S■;M;J?:.13?^ '.fi??.?$s^y9n.?i.-{iaisfi^ 393 Construction on the Third Looks Project, then hailed as the greatest single engineering work in the world, started in 1!>4() and was puslied vigorously until suspended in May V.H'J. because of more urgent war needs for ships, material and manpower. More than $7(>,()00,U()() was expended, largely on huge lock site excavations near Uatun and Mirallores, a roadl)ed for relocating the Panama Railroad near Gatun, and a rail-vehicular bridge across the Mira- flores Locks, all of which can be used in completing major modernization. Fortunately, no excavation was undertaken at Pedro Miguel. As a direct consequence of the publication in 1040 of my first book, "Cadiz To Cathay," I was ordered to the Canal Zone for duty on the eve of I'.S. involvement in World War II. When arriving on the Isthmus in February 1941, the Canal Zone was the scene of tremendous activities in connection with the Third Locks Project and vast preparation for defending the canal. My assignment was as captain of the Port of Balboa with supervision over marine operations in the Pacific sector of the canal. This area included the southern part of Gatun Lake, Gaillard Cut, the two sets of Pacific locks, Mirafiores Lake, and the Pacific sea level section to deep water, the most hazardous part of the canal. I PANAMA CANAL PRINCIPAL MARINE OPERATING PROBLEMS AND NAVIGATIONAL DANGERS 1 THE DAI^GEROUS TRAFFIC BOTTLENECK AT PEDRO MIGUEL 2 THE DOUBLE HANDLING OF VESSELS AT THE PACIFIC LOCKS AND THE RESULTING LOCK ACCIDENTS AND LOSS IN TRANSIT TIME 3 THE EFFECT OF FOG ON CANAL CAPACITY AND MARINE OPERATION 4 THE LOCKAGE SURGES IN GAILLARD CUT 5 THE NAVIGATIONAL HAZARDS OF GAILLARD CUT CAUSED BY THE BENDS AND THE RESTRICTED CHANNEL 6 THE LIMITED OPERATING RANGE OF THE LAKE LEVEL 82-87' 7 INADEQUATE DIMENSIONS OF PRESENT LOCKS (1000 BY NO FEET) JOHN S ME4RS ENGINEERING DRaf TSViN SEPTEMBER 5 1946 394 PANAMA CANAL DANGEROUS BOTTLENECK AT PEDRO MIGUEL CONTRIBUTORY OPERATIONAL FACTORS 1. PREVENTS THE USE OF MIRAFLORES LAKE AS A TRAFFIC RESERVOIR. 2. CREATES UNSYMMETRICAL OPERATING CONDITIONS AND RESULTING TRAFFIC DISPATCHING PROBLEMS. 3. CAUSES A DOUBLE HANDLING OF VESSELS AT THE PACIFIC LOCKS. 4. INCREASES LOCK ACCIDENTS. 5. INCREASES TIME OF TRANSIT. 6. FORCES SOUTHBOUND VESSELS TO SLOW DOWN IN A ROCKY GORGE. 7. CAUSES SOUTHBOUND VESSELS TO BANK UP IN DANGEROUS WATERS WHEN TRAFFIC SCHEDULES ARE DISARRANGED. 8. CAUSES NORTHBOUND VESSELS TO ENTER GAILLARD CUT UNDER ADVERSE CONDITIONS. 9. IMPAIRS THE OPERATION AND CAPACITY OF THE CANAL DURING FOG PERIODS IN GAILLARD CUT AND DURING PERIODS OF ONE-WAY TRAFFIC FOR CRITICAL VESSELS. NOTE : PEDRO MIGUEL LOCKS HAVE THE HIGHEST TOTAL ENTERING AND DEPARTING ACCIDENT RECORD OF ALL THE LOCKS. Soon after arrival two marine accidents in tlie canal followed by the sus- pension of construction on the Third Locks Project led to the study of the problems of marine operations, of which I shall discuss seven crucial ones: PANAMA CANAL LOCK ACCIDENTS JAN. 13 1922— -JULY 13 1942 LOCK NUMBER OF LIFTS TOTAL ACCIDENTS ACCIDENTS IN CHAMBERS ENTERING ACCIDENTS DEPARTING ACCIDENTS TOTAL ENTERING AND DEPARTING GATUN 3 152 41 87 24 111 PEDRO MIGUEL 1 138 15 79 44 123 MIRAFLORES 2 103 28 56 19 75 TOTALS 6 393 84 222 87 309 TOTAL PACIFIC LOCK ACCIDENTS 241 TOTAL ATLANTIC LOCK ACCIDENTS 152 PACIFIC LOCK CHAMBER ACCIDENTS 43 ATLANTIC LOCK CHAMBER ACCIDENTS 4 1 PACIFIC ENTERING AND DEPARTING 198 ATLANTIC ENTERING AND DEPARTING 1 1 1 JOHN S MEARS ENGINEERING DRAFTSMAN SEPTEMBER 10 1946 395 (1) The dangerous bottleneck at Pedro Miguel caused by placing the locks there squarely across the south end of Gaillard Cut thereby forcing south- bound vessels to slow in the restricted cut channel and thus to lose rudder force under hazardous conditions. Offioi , ho*ocrn^h inte Pacific Locks septreted i as seen i'rom the Paoifio iee-ls-ael sectior., exit from Culebra (Gaillard) Cut and the toi Lake water level to that of Gatun LeV:e ( -^ I mediate level Klraf lores Lake (-/-S4') Observe Pedro Miguel Locks eoross the rain suitable for elevating Uiraf lores 7" - 82' )• "ith expanded anohoregs. 32-461 O - 78 - 26 396 (2) The double handling of vessels at the Pacific Locks, with resulting in- convenience, increased numbers of accidents, and loss of time. FOGDAYSINGAILLARDCUT REPORTED BETWEEN 700 AM AND THE END OF EACHDAY^ TRAFFIC JANUARY 1,1942-DECEMBER 21. 1942 FOGS MAY FORM AFTER 9.00 PM FOGS USUALLY CLEAR BY 830 AM FOG AREA EXTENDS BETWEEN PEDRO MIGUEL AND OARIEN OR BOHIO DRY SEASON WET SEASON TOTAL 8 IIP 118 ,[ '^ 1 1 u 1 1 14 1 » 13 > 1 2 1 J? I 1 1 » 4 ■ ■ 2 2 1 1 III 8 1 1 1 1 8 ll 1 (3) The adverse effect of night fogs in Gaillard Cut on canal capacity and operation. PANAMA CANAL F 397 (4) The surges of 3' maximum amplitude in the Gaillard Cut water level caused by the operation of tlie locks at Pedro Miguel. PANAMA CANAL LAKE LEVEL OPERATING RANGE YEAR HIGH LOW RANGE MINIMUM DEPTH SURGE FACTOR MINIMUM CONTROLLING DEPTH 1936 87.10' 81.90' 5.2 0' 41.90' 1.5' 40.40' 1937 86.2 3' 83.47' 2.76' 43.47' 1.5' 41.97' 1938 86.65' 83.95' 2.70' 43.95' 1.5' 42.45' 1939 87.01' 84.44' 2.57' 44.44' 1.5' 42.94' 1940 86.65' 83.44' 3.21' 43.44' 1.5' 41.94' 1941 86.48' 83.47' 3.01' 43.47' 1.5' 41.97' 1942 86.65' 82.99' 3.66' 42.99' 1.5' 41.4 9' 1943 86.92' 84.51' 2.41' 44.51' 1.5' 43.01' 1944 87.02' 83.32' 3.7 0' 43.32' 1.5' 41.82' 1945 87.08' 83.10' 3.98' 43.10' 1.5' 41.60' WET SEASON INFLOW SUFFICIENT FOR ALL PURPOSES DRY SEASON INFLOW INSUFICIENT TO MAINTAIN LEVELS. PRESENT LAKE LEVEL OPERATING RANGE 82'-87'." SURGE FACTOR 1.5". PRESENT CONTROLLING DEPTH RANGE 40 5' -45 5'. NOTE : Elimination of 3' surges will permit a maximum lake elevation of 88 0' ± without structurol change This would increase the effective loke level operating range to 80.5'-88 0', and supply a depth range of 40 5'- 48 0' (5) The limited operating range of Gatun Lake water level from a high of 87' to a low of 82'. PANAMA CANAL GROUNDINGS IN GAILLARD CUT BAS OBISPO PI. I- 29* 59' 11" R- 5372 SOFT 1914 PRISM LINES SHEET NO. SCUD CIRCLES INDICATE LOCATION DIRECTION OF TRANSIT INDICATED BY ARROWS JOHN % KAn 398 PANAMA CANAL GROUNDINGS IN GAILL ARD CUT LAS CASCADAS P I I- 09- 09" 30* 1930 PRISM LINE/ SHEET NO 2 NOTE SOLID CIRCLES INDICATE LOCATION DIRECTION OF TRANSIT INDICATED BY ARROWS PANAMA CANAL GROUNDINGS IN GAILLARD CUT JOHN S MEARS LIRIO P I, 1- 22° 13 55 R- 7493. 93FT CULEBRA PI I- 17' 42' 52" R- 2566 .88 FT SOLID CIRCLES INDICATE LOCATION DIRECTION OF TRANSIT INDICATED BY ARROWS ENGINEERING DRftFTSUAN 399 PANAMA CANAL GROUNDINGS IN GAILLARD CUT I9I4PRISML1NE MIRAFLORES LOCKS SOLID CIRCLES INDICATE LOCATION DIRECTION OF TRANSIT INDICATED BY ARROWS ENGlNeERiNG ORkf TSMAN OCTOBER 4 1946 Courtesy of Panama Canal Co. S.5. Stuelore aground in Culebra Cut at L'npire Mooring, l-'ebruary 18, 1942, with Panana Canal salvage vessel Favorite alongside. 400 CONTROLLING CHANNEL WIDTHS -1000'+- ■f 800'4- i- Q^S 500^ 300- SOUTHBOUHO ACCIOtNTS- 9S rPinrrH L STATION • SOUTHBOUND _ S : ;|I ||;i§ fl f|i p fi fill aiNTERSECTION ^o ffORTHBOUND jfc St gjt |t «;[ !S (6) The navigation hazards of GaiUard Cut restricted channels, then of 300' minimum bottom width. 401 Orficiel V. S. y.&vy FhotOi^rRph U. S. S. Bunker Hill - (VC-17) a.t Gatun Looks, Soptan-ber 17, 1943. (7) The limited dimensions of tlie present loclis, 1,000' x 110' x 41' 402 PANAMA CANAL LAKE LEVEL OPERATIONAL EVALUATION OPERATIONAL FACTORS LOWERING LEVEL EFFECT VALUE RAISING EFFECT VALUE HAZARDOUS CHANNEL LENGTH CHANNEL ACCIDENTS TRANSIT SPEED TRANSIT TIME SURGES IN GAILLARO CUT EFFECT OF FOG ON OPERATIONS NUMBER LOCK LIFTS * LOCK ACCIDENTS * MAXIMUM CHANNEL DEPTHS IN GAILLARD CUT MINIMUM CHANNEL DEPTHS IN GAILLARD CUT LAKE LEVEL OPERATING RANGE SUMMIT WATER STORAGE DRY SEASON USABLE STORAGE FOR LOCKAGES FLOOD CONTROL EFFECTIVENESS TRANSVERSE CURRENTS TRAFFIC CONTROL GENERAL NAVIGABILITY INCREASES INCREASES DECREASES INCREASES INCREASES ACCENTUATES DECREASES DECREASES DECREASES DECREASES DECREASES DECREASES DECREASES DECREASES INCREASES COMPLICATES IMPAIRS - DECREASES + - DECREASES + - INCREASES + -** INSIGNIFICANT - DECREASES + - MITIGATES + + NO CHANGE + NO CHANGE - INCREASES + - INCREASES + - INCREASES + - INCREASES + - INCREASES + - INCREASES + - DECREASES + - FACILITATES + IMPROVES + RAISING LAKE LEVEL IMPROVES OPERATIONS LOWERING LAKE LEVEL IMPAIRS OPERATIONS + OPERATIONAL BETTERMENT - OPERATIONAL IMPAIRMENT NO SIGNIFICANT OPERATIONAL EFFECT * BASED UPON PROGRESSIVE REMOVAL OF LOCK LIFTS ** INCREASED SPEED NEUTRALIZED BY INCREASED LOrKAGE INTERVAL. MARINE FEATURES SUMMIT HEIGHT LOCKS SUMMIT LEVEL ANCHORAGES LENGTH OF CANAL LENGTH OF HAZARDOUS CHANNEL NO OF CRITICAL CURVES (20'*) IN THE HAZARDOUS CHANNEL TOTAL CURVATURE IN THE HAZARDOUS CHANNEL FOG AREA FOG DAYS FOG SEASON FOG HOURS FOG FREE AREAS EFFECT OF FOG ON OPERATIONS STEERING FAILURE TRANSVERSE STREAMS TRANSIT TIME PILOTS VISION RANGE SIGNAL STATIONS HOURS OF LOCK OPERATION TRAFFIC CONTROL 403 PANAMA CANAL HIGH LEVEL VS TIDAL LEVEL MARINE OPERATIONAL FEATURES COMPARED MODIFIED HIGH LEVEL B5'-90'± 2GR0UPS TRIPLE LIFT I IN EACH TERMINAL 44.83 MILES T.69 MILES Z TIDAL LEVEL LOCK 10 * ALTERNATING IGROUP SINGLE LIFT NONE 44.83 MILES 31.18 MILES 12 GALLARO CUT NORTH OF PEORO MKWEL TO BOHO. WOULD PROBABLY BE EXTENDED 118 IN GAILLARD CUT IN 1942 MAY TO DECEMBER 9.00 PM TO 8 30 AM MAXIMUM DURATION GATUN AND MIRAFLORES LOCKS AND SUMMIT ANCHORAGES ENABLES 24 HOUR LOCK OPERATION DURING FOG PERIODS IN GAILLARO CUT NONE REQUIRED MOST FREQUENT M GAILLARD CUT MOST FREQUENT IN NARROW SECTIONS OF CHANNELS MOST FREQUENT N GAILLARO CUT 24 SIMPLE WITH TWO WAY TRAFFIC POSSIBLE EXCEPT FOR LARGE VESSELS IN GALLARO CUT AND SEA LEVEL REACHES HIGH LEVEL CANAL CONNOTESTHE EXISTING CANAL MODIFIED TO INCLUDE A SUMMIT LEVEL ANCHORAGE ON THE PACIFIC AND THE CONSTRUCTION OF THE PACIFIC LOCKS IN THREE LIFTS NEAR MIRAFLORES. WOULD PROBABLY BE INCREASED SAME AS HIGH LEVEL WOULD PROBABLY BE WCREASED SLIGHTLY MIRAFLORES LOCKS.NO ATLANTIC LEVEL ANCHORAGE PROVIDED CURTAILS OPERATIONS DURING FOG PERIODS IN HAZARDOUS CHANNEL REQUIRED COLLISION AREA WOULD BE EXTENDED CONSIDERABLY GROUNDING AREAWOULD BE EXTENDED CONSIDERABLY STEERING FAILURE AREAWOULD BE EXTENDED CONSIDERABLY WOULD BE REDUCED TO LESS THAN ONE HALF AS CAUSED BY OPERATING A TIDAL LOCK WITH HEAD OF I0'± NUMBER WOULD BE MATERIALLY INCREASED WOULD BE INCREASED VISION WOULD BE MUCH REDUCED ADDITIONAL NUMBER REQUIRED UMTED TO HOURS OF FAVORABLE VBBLITY WOULD CAUSE DIFFICULT TRAFFIC CONTROL PROBLEMS WITH TWO WAY TRAFFIC RESTRICTED FOR LARGEST VESSELS TIOAL LEVEL CANAL SIGNIFIES A LOW LEVEL CANAL ABOUT 500 WIDE WITH THE SAME APPROXIMATE CHANNEL CHARACTERISTICS AS THE PRESENT CHANNEL AND WITH ONE TIOAL LOCK ON THE PACIFIC. PANAMA CANAL THE SOLUTION OF THE PRINCIPAL MARINE OPERATING PROBLEMS AND NAVIGATIONAL DANGERS 1 THE PHYSICAL REMOVAL OF PEDRO MIGUEL LOCKS FROM THEIR POSITION AT THE SOUTH END OF GAILLARD CUT 2 THE RELOCATION OF ALL PACIFIC LOCKS IN CONTINUOUS LIFTS NEAR MIRAFLORES 3&4THE FORMATION OF A LARGE HIGH LEVEL ANCHORAGE NORTH OF MIRAFLORES 5 THE WIDENING OF THE REACHES AND BENDS OF GAILLARD CUT 6 THE ELEVATION OF THE LAKE LEVEL TO OPTIMUM NAVIGATIONAL AND OPERATIONAL LEVEL 7 CONSTRUCTION OF A SET OF LARGER LOCKS NOTE THE PLANNING OF LOCK LOCATIONS FOR ADDITIONAL SETS OF LOCKS ON EACH COAST FOR PROPORTIONAL INCREASES IN THE BERTHING CAPACITY AT GATUN ANCHORAGE AND FOR THE EVENTUAL ENLARGEMENT OF MIRAFLORES LAKE TO ACCOMMODATE THE INCREASED LOCKAGE CAPACITY ARE DIRECTLY RELATED TO THE MARINE OPERATIONAL PLANNING 404 To secure the best canal for the transit of vessels, the only practical solu- tion, as demonstrated by more than half a century of operations, is as fol- lows : (1) The physical removal of the bottleneck Pedro Miguel Locks from their position in the south end of Gaillard Cut to enable vessels to leave the cut without stopping. (2) The consolidation of all Pacific Locks in new structures of continuous lifts south of Miraflores near Aguadulce as they are at Gatun. (3&4) The elevation of the intermediate Miraflores Lake, 54' above mean sea level, to that of Gatun Lake to provide uninterrupted summit navigation from the Atlantic Locks to the Pacific Locks, create a summit level lake an- chorage at the Pacific end of the canal in the Miraflores Basin, mitigate the effect of fog on canal capacity and operations, eliminate lockage surges in Gaillard Cut, save transit time, and simplify Canal operations. PRESENT CANAL GATUN LOCKS 406 (5) Raising the .summit water level, now 87' maximum, to its optimum height of 92' (report of the Governor of the Panama Canal under Public Law j-bO, 79th Congress, summarized in A.S.C.E. transactions, vol. 114 (1949), p. (6) Continued enlargement of Gaillard Cut as demonstrated bv experience to be needed. Widening the cut from 300' to 500' and correlated" channel im- provements were completed on August 15, 1970, at a cost of $95,000,000 (7) Construction of one set of larger locks, 1,200' x 140' x not less than 45'. FUTURE CANAL This action program, known as the Terminal Lake-Third Locks plan, can be accomplished under the "maintenance" factor in existing treaty provisions-. It would provide a two-way ship channel in the summit level from the At- lantic Locks to the Pacific Locks with adequate and logically arranged locks at each end of the canal. Moreover, any major modernization plan that fails to provide for the elimination of the Pedro Miguel Locks is fatally deficient and .should be summarily di-smissed as being without .suflScient merit to warrant any consideration except to refute it. In this connection, proposals for a surge basin, mooring stations, and certain other projects are not realistic solutions of the crucial marine operational problems but mere symptomatic treatments that can only serve to delay or confuse. .Besides, the Terminal Lake-Third Locks solution is the proposal fvilly supported by Panama Canal pilots who have the responsibility for the navigation and movement of vessels in Canal Zone waters and thus know the navigational problems involved at first hand. When these problems are evaluated from all significant angles the Terminal Lake proposal provides the best solution at least cost and can be accomplished with every assurance of success. A part of the Terminal Lake proposal was the widening of Gaillard Cut from 300' to 500', completed in 1970 at a cost of some $95,000,000. When added to the $76,000,000 previously expended on the Third Locks Project, the total is over $171,000,000 already invested toward major canal modernization. Many have asked why the Terminal Lake concept was not developed pre- viously. It was. In 1908, it was proposed by Colonel William L. Sibert but not adopted be- cause it would have caused a delay in opening the canal. In 1906 it was recom- mended by William Gerig. Prior to Gerig, it was urged on the Congress as a desirable change in approved plans by Chief Engineer Stevens. Perhaps the inability to secure its adoption was the failure to have facts that could be derived only from actual marine experience in operating the canal. The Terminal Lake solution is so obvious, simple and logical that many have wondered why it was not proposed at the start of the French effort. It was. At the Paris Congress of 1879, called by Ferdinand De Lesseps to consider the issues of .site and type, De Le.sseps. relying upon his experience in con- 407 structinj;' the ^uez Canal, applied the full force of his genius and prestige to securing the approval by that body of 134 distinguished leaders for a canal at the Panama site of the sea-level type. When he saw what was taking place, one member rose in protest. His words, liere summarized, were : of all then present, he was the only one who had studied this subject. Rather than have his name associated with what he knew would be a great disaster, he voted no, but stated there is a "prac- tical plan" for constructing the Panama Canal. "Build a dam at Gatun and another at Miratlores, or as close to the .seas as the configuration of Ihc land permits. Let the waters rise to form two lakes about SO feet high, join the lakes thus formed with a channel cut through the Continental Divide, and connect the lakes with the oceans by locks. This is not only the best plan for engmeering but also best for navigation." (U.S. Nav. Inst. Proc, March 1955, p. 264.) Essentially, this was the plan eventually adopted by the United States in 1906 through the leadership of John F. Stevens. The originating genius who conceived it was the eminent French engineer, Adolphe Godin de Lepinay, who, by so doing, won a lasting fame as the precursor of the Panama Canal. The Terminal Lake proposal now before the Congress has been described by experienced engineers as the most fundamental proposal since the 1906 reloca- tion of the Atlantic Locks and Dam from Bohio to Gatun. Its adoption will complete the De Lepinay-Stevens conceptions and, by providing a balanced lake waterway, will give the world the best canal for navigation practicable of achievement. As to the "sea-level" canal proposal, this is not a new idea but an ancient one. Studied in 1905-06, it was opposed by Chief Engineer Stevens and Presi- dent Theodore Roosevelt. Later, in 1924, former Governor of the Panama Canal Jay J. Morrow described it as a "hardy perenniel" and that apparently there would always be "someone to argue for it, no matter how often the impossibility of realizing any such scheme within practicable limits of time and cost may be demonstrated." (Jay J. Morrow, personal letter to John F. Stevens, May 31, 1924.) In 1929-31, it was examined by a U.S. Army Interoceauic Canal Board but opposed by Governor Harry Burgess who stated : "As the experience in operating the canal has proved that vessels of the largest size can transit a lock canal safely and expeditiously, there appears to be no necessity for con- verting it into a sea-level canal, so far as can now be foreseen." This reference was to the transits in 1928 of the Lexington-Saratoga class of aircraft car- riers, the overall dimensions of which were 888' by lOG'. The report failed to receive the support of the Chief of Engineers who merely recommended its publication. (Ho. Doc. No. 139, 72d Congress.) The Congress took no action thereon but in 1939 authorized the construction of a third set of locks. (Ho. Doc. No. 210 and Pub. L. 391, 76th Congress.) ^ •; X'v^^V^ti^xi'^Xi* -^0\ r^^^^^^i^'-r»: "^sln" at Balboe from Sobs HUl, Ce ; iBomj' 7. WW ' 408 In 1942, because of the congestion in Balboa Harbor of vessels loaded with ammunition, canal authorities became concerned about a potential Halifax Disaster, which was a factor leading to the enlargement of the harbor. Today, super tankers and liquified natural gas (LN(i) vessels create grave dangers. The record of super tanker disasters, even in ocean s-paces (Nat. Geo., July WIS, pp. 102-24), and possible calamitous explosions of LNG vessels (Lib. Cong. LNG Safety, Siting and Policy Concerns, 1978, pp. XI-XIII) raise serious questions as to the wisdom of permitting such vessels to navigate in restricted waters of populated areas, including any type of interoceanic canal. In regard to the capacity of an isthmian canal to handle naval vessels, the modernized existing canal would be able to transit efficiently and ex- peditiously the entire U.S. Navy except 13 large aircraft carriers. In 1943, as the i-esult of experience in World War II, extensive studies of marine operations in the Panama Canal from 1914 through 1942, and an operational evaluation of the then projected "sea-level" plan, there was de- veloped in the canal organization the well-known Terminal Lake-Third Locks plan as offering the best solution for increased capacity and operational improvement of trans-isthmian transit facilities. This plan was submitted on February 25, 1943, to higher canal authority, publicly pres'ented in Balboa, C.Z., on May 20, 1943, before the I'anama section of the American Society of Civil Engineers, high Army, Navy, and canal officials, and published by the society after World AVar II under the title of "The Marine Operating Prob- lems, Panama Canal, and the Solution." (A.S.C.E. Proceedings, Feb. 1947, pp. 161-74.) In 1944, after completing his preliminary studies of the plan on January 17, Governor Glen E. Edgerton recommende. Pt. 12 (Mar. 4, 1949), P. A1303. Martin. Honorable Thomas E. : "Tlie Atomic Bomb and the Panama Canal." extension of Remarks quoting an article by Major General C. F. Robin.son in the Militan/ Engineer, .January-February 1949, Congressional Record (81st Cong., 1st Se.s.sionj, Vol. 95, Pt. 12 (Feb. 14. 1949), p. A755. . . "The Panama Canal and Nuclear AVeapon.«?." Extension of Re- marks quoting an article by Lt. Colonel A. AV. Betts in the MUitarg Engi- neer, Mar.-Apr. 1949. Conr/ressional Record (81st Cong., 1st Sess.), Vol. 95, Pt. 13 (Mar. 24, 1949), p. A1713. "The Atomic Bomb and the Isthmian Canals." Extension of Re- marks quoting an article by Lt. (Jeneral Leslie R. Groves in Cosmopolitan, .Tanuarv 1949. Conqrcssional Record (Slst Cong., l.st Session), Vol. 95, Pt. 12 (January 13, 1949), p. A169. 413 '■I'iiiiaiiui Canal Secairity Against, Atoniic Attack." Extension of Remarks quoting an article by Lt. Commander 11. V>. Seim in the 11. S.N. I. I'rocccdiitys, April 1941). Voiiynssional Record (Slst Congress, 1st Sess). V )1. i»5, Pt. 13 (May 2, 194!J), p. A2(;39. "Isthmian Canals and National Defense". Extension of Remarks (inoting an article by Hanson W. Baldwin in Athmtic Monlhly. July IIMIJ. Coni/rcssional Record (81.st Cong., 1st Sess.), Vol. 9,1, I't. 1.") (.July 14, 1949), p. A4G27. "A Balanced Military I'olicy for the Cnited States". Extension of Renuirks (pioting an address Ity General Omar N. Bradley in the Military Engineer, Mar.-Apr. 1949. Congressional Record (Slsts Cong., 1st Sess.) Vol. 95, Pt. 15 (Aug. IS, 1949), p. A5402. "Interoceanic Canals — The Atomic Bom band Xational Defense". Extension of Remarks (juoting an article by Commander Robert C. Wing in tlie T'. S.X.I. Proceedings, Sept. 1949. ('ongrcssiO)i(il Record (otential rivals. At Panama, mountainous terrain and tor- rential rivers, notably the Chagres, at first represented insuperable barriers to the con- struction of a canal. At Nicaragua, the exist- ence of a large lake, with the then navigable San Juan River flowing from it into the At- lantic, reduced the magnitude of that under- taking simply to cutting across the narrow strip separating the lake from the Pacific. These facts undoubtedly supply the basis for the initial predilection of the United States in the 19th Century for a Nicaraguan canal. Eventually, the control of the Nicaragua route became a focal point of international conflict, with Great Britain and the United States in a diplomatic deadlock. This diffi- culty was not removed until 1901, when the Hay-Pauncefote Treaty superseded the earlier Clayton-Bulwer Treaty of 1850, which had deprived the United States of exclusive control o£ any Isthmian canal. Pattern of Isthmian Canal Issues Evolves Meanwhile, French interests under the dynamic leadership of Ferdinand de Lesseps had decided to construct a canal across the Isthmus. An International Congress for Consideration of an Interoceanic Canal met in Paris in 1879. There, this Congress wrestled with the difficult questions of select- ing the best site and deciding on the best type. De Lesseps, the hero of Suez, (a simple sea-level canal), lent the full force of his prestige and his genius toward securing approval for a "sea-level" undertaking at Panama — a wholly different problem. One engineer, the only one in that Con- gress who had adequately studied the geogra- phy of Isthmian regions and grasped their significance, when he saw the trend toward decision for the "sea-level" type, rose in strong protest. He understood the topography at Nicara- Gradvating from the U. S. Naval Academy in 1918 (Class of 1919), Captain DuVal has had extensive naval service including duty from 1941 to 1944 as Captain of the Port, Balboa, C.Z., in charge of marine operations in the Pacific Sector of the Panama Canal. From 1946 to 1949 he was Navy Department Liaison Officer and Co- ordinator of Isthmian Canal Studies, under the Chief of Naval Operations. He is the author of two books on the Canal, And The Mountains Wiil Movt and Cadii to Calliay, published by Stanford University Press, and is now complet- ing a third volume in his trilogy. 263 416 264 U. S. Naval Institute Proceedings [March gua and how its elevated lake, 105.5' high, would contribute toward the construction and operation of a canal there. He knew the surface features at Panama — the continental divide about ten miles from the Pacific, the torrential Rio Obispo-Chagres flowing into the Atlantic, and the smaller Rio Grande into the Pacific, both through contiguous valleys suitable for the formation of lakes. Interpreting these elements in the light of maritime as well as engineering needs, he recognized the lake idea as offering the solu- tion of the canal problem. Then, with the vision and simplicity of true genius, he proposed a "practical" plan for the Panama Canal, here sum- marized: "Build a dam at Gatun and an- other at Mirailores, or as close to the seas as the configuration of the land permits. Let the waters rise to form two lakes about 80 feet high, join the lakes thus formed with a channel cut through the continental divide, and connect the lakes with the oceans by locks. This is not only the best plan for engi- neering but also best for navigation." Es- sentially, that was the plan for the Panama Canal eventually adopted in 1906. The man who conceived and presented the plan was Adolphe Godfn de L^pinay. The applicability of this plan — the only one which at that time could have had any chance for success — was not understood. De L^pinay's great idea was ignored. His con- ception of this plan, however, and its drama- tic presentation before the Paris Congress of 1879 establish him as an architectural and engineering genius — the originator of the plan from which the Panama Canal was eventually built. The French, despite De Ldpinay's timely warning, launched upon their ill-fated under- taking. Ten years later, in 1889, their effort collapsed and the Isthmus returned to the jungle. Yet, before the failure, the French, to save time and money, were forced to change their plans from "sea-level" to a modified high-level lake and lock type. Thus, as the 19th Century closed, the pat- tern of interoceanic canal's focal political and engineering issues had evolved: first, a struggle among competing interests in the choice of route; and second, debate as to the type of canal, with final decision for the high-level-lake and lock type at Panama. Panama Wins the Battle of the Routes In 1899, after more than half a century of exploration, including a number of naval expeditions, the United States started serious investigations by means of an Isthmian Canal Commission for exploration, 1899- 1902, of which Rear Admiral John G. Walker, a distinguished line officer of the U. S. Navy, was president. After an extraordinary political struggle, known as the "battle of the routes, "the Con- gress authorized the acquisition for the United States of a canal zone in what was then a part of the Republic of Colombia, the purchase of the French holdings, and construction of a canal at Panama, with provision for the Nicaragua Canal as an alternate project, if suitable arrangements could not be made for one at Panama. To this end, the Charg6 d'AflFaires of Colombia, Dr. Tom£s Herrdn, a graduate of Georgetown University and well ac- quainted with American governmental lead- ers, succeeded, after many months of arduous labor, in negotiating what was considered a most favorable canal treaty for his country — the Hay-Herrdn Treaty of January 22, 1903, which was ratified by the United States Senate on March 17, 1903. Unfortunately, this treaty became in- volved politically in • Bogotd. The Colom- bian Senate, called into special session on June 20, 1903, for its ratification, rejected the treaty on August 12, 1903, against urgent pleadings of Dr. Herrdn in Washington and U. S. Minister Arthur M. Beauprd in Bogotd. Panamanian leaders, fearing that after all Panama still might lose the canal to Nicaragua, set out to prevent that possi- bility. Under the leadership of Dr. Manuel Amador, the state of Panama seceded from Colombia on November 3, 1903, and de- clared its independence. This was quickly recognized, first, by the United States, and appropriately, second, by France, the coun- try that started the waterway. Then fol- lowed the Hay-Bunau-Varilla Treaty of November 18, 1903, which was ratified first by Panama and then by the United States. In this treaty the Republic of Panama granted to the United States "in perpetuity" 417 1955] Isthmian Canal Policy — An Evaluation 265 the "use, occupation and control of a zone of land and land under water for the con-, slruction, maintenance, operation, sanitation and protection" of the Panama Canal— and as if the United States were the "sovereign" of that territory. The ratification of this treaty sealed the choice of the Panama route. The technical justification for this funda- mental action was supplied by the Isthmian Canal Commission, 1899-1902, which, under the direction of Rear Admiral John G. Walker, explored all canal routes. He also headed the first Isthmian Canal Commission for construction of the Panama Canal (1904- 05) under which the Canal Zone was ac- quired, the Canal Zone Government organ- ized, and preliminary work started. These achievements place him in history as a prin- cipal architect of Isthmian Canal Policy. Battle of the Levels and the Great Decision Work under the United States control started haltingly, with increasing uncer- ; tainty as to th^ typte of canal that should I be constructed — the high-level-lake and lock type or a canal at sea-level. Each proposal had strong advocates. Fortunately, when the time for decision I approached, President Theodore Roosevelt ' selected the great railroad builder, explorer, and business executive, the late John F. Stevens, as Chief Engineer of the Isthmian Canal Commission. Mr. Stevens' qualifications were unique. He had read everything available on the proposed Panama Canal since the time of Philip II, built railroads in the Rocky Mountains, and sup>ervised open mining operations in Minnesota. Thus, in his experi- ence he had witnessed what occurs when the balances of nature are altered, and under- stood the hazards involved in excavating a navigation channel through mountains. Arriving on the Isthmus on July 25, 1905, at the height of a crisis, he had matters under control within 24 hours. Experienced as he was in large undertakings, he promptly provided housing for employees, organized commissaries, encouraged sanitation, or- dered equipment, planned the transportation system, and formed the basic engineering organization for building the Panama Canal. Indeed, so rapid was his progress that he found himself hampered by having to wait for a decision as to the type of canal , then being considered by an international Board of Consulting Engineers. In its report of January 10, 1906, this board split — eight members, including five Europeans, voting for "sea-level"; and the five remaining Americans voting for high- level-lake and lock. The naval member on the Isthmian Canal Commission at that time was the Chief of the Bureau of Yards and Docks, who, in a minority report, favored the "sea-level" plan as "afiFording greater immunity from hostile injury."' Meanwhile at Panama, Stevens had walked through the entire length of the canal route and studied the topography. Interpret- ing it in the light of navigational require- ments as well as construction, he decided upon the high-level-lake and lock plan, with the Atlantic terminal dam and locks at Gatun. For the Pacific end, he favored plac- ing its locks in one group south of Mira- fiores at Aguadulce, just as he planned to do at Gatun. Testifying in Washington before Congres- sional committees in January, 1906, with a conviction for the high-level plan that no one could shake, he voiced his determined opposition to the "sea-level" idea. But one appearance was not enough. In June, he was again in Washington, still lead- ing in this memorable struggle, later de- scribed by Colonel George W. Goethals as the "battle of the levels." On this occasion, Stevens even more forcefully and fearlessly urged the high-level-lake plan as the logical solution. In the end, with the support of President Theodore Roosevelt, Secretary of War William H. Taft, and the Isthmian Canal Commission, the recommendations of Chief Engineer Stevens prevailed. Congress, by the Act approved June 29, 1906, adopted the high-level-lake and lock plan as proposed by the minority of the international Board of Consulting Engineers. That was the great decision in building the Panama Canal, for the second time completing the pattern of interoceanic canal political and engineering debate. ' Report of Board of Consulting Engineers for the Pana- ma Canal (Washington, 1906), p. xix. 418 266 419 19551 Isthmian Canal Policy — An Evaluation 267 Here it should be noted that when making his recommendation to the Congress for this action, President Roosevelt did so after evaluating all available evidence of relative vulnerability and operational effectiveness of the two types. Although he understood that the "sea-level" tyi>e would be "slightly less exposed to damage in event of war,"' he recommended the high-level plan because of its economic and operational superiority. The transit from 1914 through August 31, 1954, in both peace and war, of more than 230,517 vessels of various types has com- pletely established the wisdom of that de- cision. Moreover, it secured Chief Engineer Stevens, who was primarily responsible for bringing it about, his great fame as the basic architect of the Panama Canal. Civilian Control Replaced by Military Though the high-level plan, as approved by the minority of the International Board of Consulting Engineers, provided for placing all Atlantic Locks at Gatun, it also specified separation o( the Pacific Locks into two groups. Chief Engineer Stevens, who had had railroad operating experience, recog- nized the operational inconvenience of this arrangement and never favored dividing the Pacific Locks. Eventually, on August 3, 1906, Stevens tentatively approved a plan developed by William Gerig. The proposal placed all Pacific Locks in three lifts south of Mira- flores with the terminal dam and locks be- tween two hills, Cerro Aguadulce on the west side of the sea-level section of the canal and Cerro de Puente on the east side, — on a natural perimeter that would have supplied the same arrangement as at Gatun. This plan, had it been followed, would have en- abled lake-level navigation from the Atlantic Locks to the Pacific, with a summit-level anchorage at the Pacific end of the canal to match that at the Atlantic end. Regrettably, Stevens was under great pres- sure to start construction. Advocates of the "sea-level" proposal, stung to the quick by their defeat in Congress, were poised * Ikid., p. iv. ready to take advantage of a major change in the approved program as evidence of weak- ness in the high-level plan. Opponents of any canal at all were also seeking some means to delay the enterprise. These two forces together represented a political and economic strength that could not be disre- garded. Stevens' foundation explorations, neces- sarily made in great haste, proved unsatis- factory, and he did not dare to jeopardize the project by further delay. Twenty days later, on August 23, 1906, still confident that this important question would rise again, he voided his plan marking it, "not to be destroyed but kept in this office," and pro- ceeded with the approved plan for separating the Pacific Locks. In 1907, after having brought construc- tion to a point where the success of the pro- ject was a certainty, Stevens resigned his positions as Chief Engineer and Chairman of the Isthmian Canal Commission, to which combined offices he had been appointed by President Roosevelt in recognition of his contributions. He was succeeded by Colonel George W. Goethals under whose able direc- tion the work was carried forward. Panama Canal Opened for Traffic Notwithstanding this shift in adminis- trative control of the canal enterprise from civilian to military in 1907, the Stevens pro- posal to combine the Pacific Locks did not die. Colonel William L. Sibert seriously studied it and, on January 31, 1908, formally submitted a definite plan that reflected his appreciation of marine needs as the basis for navigational planning.' But, unfortunately, the Sibert proposal likewise was not ap- proved for reasons then deemed adequate. In this connection, it is pertinent to com- ment that after the resignation of Rear Admiral Walker in 1905 there was no experi- enced navigator on the Isthmian Canal Com- mission. Thus, one can only ponder what might have been the result had such a person been readily available for consultation with " William L. Sibert and John F. Stevens, Tlie Con- struction of tlie Panama Canal {New York: D. Appleton & Co., 1915), pp. 139-46 contains a summary of the Sibert proposal and its disposition. 420 268 U. S. Naval Institute Proceedings [March Stevens and Sibert on marine planning. In the light of later operational and engineering knowledge, developed in 1941-44, when there was such consultation between experienced engineers and marine operating officials, it is indeed regrettable that the Stevens- Sibert proposals were not adopted. Colonel Goethals headed the project to the end, making a number of important but non-basic changes, which included a widen- ing of Culebra (Gaillard) Cut and- the locks. He developed the first permanent operating organization under the Panama Canal Act of 1912 and, as the first Governor of the Panama Canal, opened the canal to traffic on August IS, 1914, and overcame the early slide crises. He and his associates won great fame as builders of the Panama Canal. In this connection, it should be explained that the original concept of the functioning of the canal enterprise as a civil agency under the Panama Canal Act was dual: in peace, as an interoceanic public utility under a Governor; in war, under the supreme control of the Commanding General of U. S. Army on the Isthmus. In either status, the opera- tional mission of the waterway remained' as the transit of vessels under the obvious as- sumption that the Panama Canal, like other transportation facilities in the United States, would serve in war as well as in peace. Defense Concepts Become Ascendant After the opening of the canal to traffic, the great builders left the Isthmus; opera- tion and maintenance became matters of routine, and the project was uncritically accepted. The rapid development of the air- plane and other modern weapons following World War I, dramatized by periodic fleet exercises off Panama, made considerations of defense matters of increasing concern; those of marine operations became second- ary. In the excitement preceding World War II, the Congress authorized construction of a third set of larger locks, primarily as a defense measure,* known as the Third Locks Project, at an authorized cost of $277,000,000. The proposed layout placed a * Public Law 391, 76th Congress, approved August 11, 1939 (535 Sut. 1409). new set of larger locks (140' XI 200') near each of the existing locks but at some distance away to afford greater protec ion through dispersal and increased lock capac- ity for large naval vessels. The new locks were to be joined with the existing channels by means of by-pass channels.' Significantly, the plan included a number of construction features for future changing of the canal to "sea-level." Thus, discerning students recognized the Third Locks Project as renewing the old "battle of the levels" in a new form— that of "conversion." The Third Locks Project layout at the Atlantic end of the canal, which duplicates an operationally sound arrangement at Gatun, is likewise sound. At the Pacific end, however, the proposed new channel layout contained three sharp bends — 29°, 47°, and 37° — in succession from north to south. The latter, if it had been completed, would have created operational problems and navigational hazards of the gravest character. Construction started in 1940 and was pushed vigorously until suspended in May, 1942, because of shortage of ships and ma- terials more urgently needed elsewhere for war purposes. No excavation was accom- plished at Pedro Miguel; that at Gatun and Miraflores was substantially completed. Some $75,000,000 was expended.* War Experience Inspires Plan for Canal Improvement The suspension of the Third Locks Project, however, afforded an opportunity, while there was still time left to make such a study, for its re-examination in the light of opera- tional needs demonstrated by marine experi- ence. This was at a period when the Panama Canal was the scene of many military and naval expeditions on their way to and from combat zones in the Pacific- This, it should be also noted, was before the advent of the atomic bomb. These studies conclusively established that the principal marine operational problems of the existing Panama Canal are: • H. Doc. 210, 76lh Congress, 1st Sess. (1939). • House Committee on Merchant Marine and Fish- eries, Executive Hearings on H.R. -NXO, 79lh Congress, 1st Sess., Nov. IS, 1945, p. 4. 1955] 421 Isthmian Canal Policy — An Evaluation 269 (1) Tehuantepec, (5) Nicaragua, (9) Chiri- qui, (IS), Panama, (16) San Bias, (17) Sasar- di-Morti, (23) Atrato-Cacarica-Tuyra, and (25) Atrato-Tniando. Courtesy American Society of Civil Engineers 1. Dangerous traffic bottleneck at Pedro Miguel and lack of a Pacific summit anchor- age. 2. Double handling of vessels at separated Pacific Locks. 3. Effect of fog in Culebra (Gaillard) Cut on capacity and ofierations. 4. Lockage surges in Cut caused by operating Pedro Miguel Locks (3' max. amplitude). 5. Limited operating range of Gatun Lake water level (87'-82'). 6. Navigational hazards in the restricted Cut (300' min. bottom width). 7. Inadequate dimensions of present locks for largest vessels (110' X 1000').' From the nature of these inadequacies, it is obvious that locating the Pedro Miguel Locks at the south end of Culebra (Gaillard) Cut, where it created a traffic bottleneck and other problems, was the fundamental error in o[>erational design of the Panama Canal. ' Hon. Willis W. Bradley, 'What of the Panama Canal?," Congressional Rttord, Vol. 94, Pt. 10 (Apr. 21, 1»««), p. A2449 and "The Whys of the Panama Canal," Contiressionai Record, Vol. 95, Pt. 12 (Mar. 4, 1949), p. A13(X3 contain extended discussions of marine problems. Under the basic assumption that the prime function of the Panama Canal is the safe and convenient transp>ort of vessels, it is self-evident that the wide channels of Gatun Lake a^ord safer and more convenient navigation than can any necessarily re- stricted channel at sca-level. Moreover, the advantages of unrestricted lake navigation outweigh the minor hazards and time lost by passage through locks. Thus, the best operational solution is not provided by low- ering the Gatun Lake water level to sea- level, or to some intermediate-level, but by raising it to its highest feasible elevation. The obvious economic operational solution thus is a major improvement of the existing canal according to what is known as the Terminal Lake-Third Locks Plan, which includes the following program: 1. Removal of the bottleneck Pedro Miguel Locks. 2. Construction of all Pacific Locks in continuous steps near Miraflores. 3. & 4. Elevation of the intermediate Miraflores Lake water level (54') to that of Gatun Lake to serve as an anchorage during fog periods and to dampen surges. 5. Raising the summit water level to its optimum height (Approx. 92'). 270 422 U. S. Naval Institute Proceedings [March Courtesy Civit Enginrering DIAGRAMMATIC SIDE ELEVATION OF THE PANAMA CANAL This drawing shows the canal modified and adapted to the Terminal Lake-Third Locks proposal. The present lake and lock canal is unshaded; the sea-level proposal is shaded. 6. Widening Culebra (Gaillard) Cut. 7. Construction of a set of larger locks. These modifications will remove the traffic choke at Pedro Miguel, correct present operational dissymmetry and simplify canal control, increase channel depths, and im- prove navigation, mitfgate the effect of fog, reduce marine accidents, decrease transit time slightly, conserve water, and increase capacity. Thus, the plan supplies the best operational canal practicable of economic achievement. This plan was publicly revealed by its author on May 20, 1943, in an address before the Panama Section of the American Society of Civil Engineers, under the title, "The Marine Operating Problems, Panama Canal, and the Solution."' Attended by high Army, Navy, and Canal Zone officials, the presenta- tion aroused the interest of the Commandant of the 15th Naval District, Rear Admiral C. E. Van Hook, who was present. He later submitted the plan to the Navy Department. On September 7, 1943, the Secretary of the Navy forwarded it to the President. Subsequently, this proposal was approved in principle by the Governor of the Panama Canal for the major modification of the exist- ing canal. According to the report of a 1949 Congressional investigation, it can be accomplished at "comparatively low cost."' Moreover, no doubt exists as to its soundness because a similar arrangement at Gatun • A.S.C.E. Tratuaclioiu, Vol. 114 (1949)', p. 558. » H. Rept. 1304, 81$t Congress, 1st Sess. (1949), p. 2. has been tested since 1914 and found emi- nently satisfactory. Atomic Bomb REStntRECTS Sea-Level Flak The spectacular advent of the atomic bomb in 1945 injected a new element into the canal picture. Under the force of its impact, canal officials sought authority to conduct an "overall review" of the entire interoceanic canals question in the light of the then newest developments in the "mili- tary and physical sciences."'" This was be- fore the hydrogen bomb. Accordingly, the Congress in 1945 en- acted legislation" authorizing the Governor of the Panama Canal to make a compre- hensive investigation of the means for in- creasing its capacity and security to meet the future needs of interoceanic commerce and national defense. The law also provided for a restudy of the Third Locks Project, a study of canals at other locations, and for consideration of any new means for trans- porting ships across land. Thus was launched the second major canal crisis in the ■20th Century. It served to resurrect the corpses of the 1902 "battle of the routes" and the W06 "battle of the levels" with a rehashing of all the main arguments of the earlier struggles on the basis of the newer term, "security," rather than the older one, "vulnerability." ^ " Committee on Merchant Marine and Fisheries, op. cU., p. 5. " Public Law 280, 79th Congress, approved Decem- ber 28, 1945 (59 Stat. 663). 423 1955] Isthmian Canal Policy — An Evaluation 271 Under a far more extreme interpretation of the "security" factor of the statute than was intended by the Congress that enacted it, the investigation was directed toward" obtaining authorization for a Sea-Level Project at Panama, with the "security" and "national defense" factors as paramount, and money costs not a "governing considera- tion."" In line with the 1905-06 precedent, the naval representative on the Boards of Consulting Engineers for the greater part, of this engineering investigation was the Chief of the Bureau of Yards and Docks. In the ensuing public hysteria centered on the dangers of the atomic bomb and other modern weapons, the long-range and funda- mental mission of the Panama Canal to provide efficient and economic transit of vessels was generally overlooked. The report of the 1946-47 Isthmian Canal Studies" recommended only the Sea-Level Project for major canal construction at Panama, initially estimated to cost 52,483,000,000. With the exception of the two terminals, this project provides for con- structing a virtually new Panama Canal of 60' minimum depth in navigation lanes and of 600' width between sloping sides at a depth of 40' on a new alignment somewhat removed from the present channel, which it crosses several times. The project includes a tidal lock (200' X 1500') and a navigable pass at the Pacific end, many miles of dams for flood control reservoirs on both sides of the projected canal, diversion channels and other structural features. This program would re- sult in abandonment of the greater part of the existing waterway and the investment that it represents. Although the 1947 report contained stud- ies of plans for a Terminal Lake-Third Lock Project, which it did not recommend, it offered a relatively minor program for im- provement of the present canal installations "to meet the needs of commerce" as a pre- ferred alternative to the major improvement of the existing waterway as recommended to " Set statement of Board of Consulting Engineers, ((Uoted in Panama American, Aug. 5, 1946, p. 3, cols. 4-<>. " Summarized with discussions in A.S.C.E. Trans- actions, Vol. 114 (1949), pp. 607-906 . the President in 1943 by the Secretary of the Navy. Transmitted by the President to the Con- gress on December 1, 1947, and without presidential approval, comment or recom- mendation, the report promptly encountered sharp opposition. The Congress took no action on this report. Instead, in 1949, it authorized an investigation of the organiza- tional and financial aspects of the canal enterprise," for which study Representa- tive Clark W. Thompson of Texas, a retired Marine Corps Reserve officer, served as Chairman. This investigation resulted in the first "basic change " in the permanent canal operating organization that was estab- lished in 1914. The new Act requires that transit tolls be established at rates that will place the operation of the canal enterprise on a self- sustaining basis — a new principle in Isthmian Canal Policy with far-reaching implications aflFecting the future economic management of the Panama Canal and interoceanic commerce. This subject is now under further Congressional study." Clarifications Restore Operations ' as Basis for Planning Meanwhile, in the Congress, the "secu- rity" and "national defense" premises, on which the recommendation for the Sea- Level Project was primarily based, were vigorously challenged. As to the atomic bomb, Representative Willis W. Bradley, a retired naval officer, summarized his views: "As far as I can ascer- tain, the greatest authorities on modem weapons of war who have given this subject serious attention hold uniformly that any canal would be critically vulnerable to the atOTiic bomb, regardless of type; that a sea- level canal would be in the same security class as a lake canal; that a sea-level canal could be closed for prolonged pieriods of " H.Res. 44, 81st Congress quoted in Congressional Rtcofd,\o\. 95, Pi. 2 (Feb. 28, 1949), p. 1617. "H.Doc. 460, 81st Congress, 2d Sess. (1950) and Public Law 841, 81st Congress, approved September 26, 1950 (64 Stat. 1038). " Hon. John J. Allen, "Panama Canal— Interim Report," Congressional Record, Vol. 100, No. 149 (Aug. 4, 1954), p. A5766. 272 424 U. S. Naval Institute Proceedings [March Official U. S. Navy Pholoffrafh THE AIRCRAFT CARRIER SARATOGA IN PEDRO MIGUEL LOCKS After a canal has been in operation for a while, ships transiting it are frequently built to the maximum draft over the sill and length and breadth of the smallest lock in the system. Until recently, the limitations of the Panama Canal had exerted an inSuence on the design of the largest units of the U. S. Navy. time beyond any hope of speedy restoration; and that a sea-level canal cannot be con- sidered secure in'an atomic war. These same authorities also agree that the atomic bomb is irrelevant as a controlling factor in the planning of operational improvements for the Panama Canal."" Representative, now Senator, Thomas E. Martin of Iowa, a retired Army officer, de- veloped the national defense clarification, re- peatedly stressing that protection of any type of canal, wherever located, is "an over-all governmental responsibility, and that its defense, like that of the seaports, airports, railroads, highways, and productive centers of the United States depends upon the com- bined industrial, military, naval, and air power of this Nation as obtained in both world wars, and not upon passive defense measures, such as may be embodied in in- herent characteristics of canal design."" " Bradley, "What of the -Panama Canal?," op. cU., p. A24S1. " Hon. Thomas E. Martin, "An Interoceanic Canals Commission, the Best Solution of Panama Canal Prob- lem," Connressional Raord, Vol. 97, Pt. 14 (July 18, 1951), p. A44S1. Here it should be stated that leading atom- ic warfare authorities, who studied the prob- lem of Canal Zone defense in 1947, considered that arguments as to relative vulnerability of types of construction are entirely without point and that the Sea-Level Project would, in effect, constitute a "Maginot Line." This view has been greatly strengthened by the later development of the hydrogen bomb, which is measured in mega-tons of T.N.T. equivalent as compared to kilo-tons for the atomic bomb. In the course of extensive discussions of the Sea-Level Project recommendation," Congressional and administrative leaders often stressed the point that this project, if justified primarily for "national defense," would divert both funds and resources from projects and programs in the United States that are far more essential to national security. The combined effects of the defense clarifications have been toward eliminating " Hon. Clark W. Thompson, "Isthmian Canal Policy of the United States — Bibliographical List," Con- gressional Record, Vol. 95, Pt. 16 (Aug. 25, 1949), p. AS580 and subsequent statements of distinguished members of Congrc^ 425 1955] Isthmian Canal Policy — An Evaluation in the concept of inherent resistance to attack as the governing consideration in planning at Panama. Thus, it appears that the only justifiable security design feature is adequate protection against sabotage, which is chiefly an administrative function. Eventually, a group of engineers and others associated in building the Panama Canal submitted their views in a memoran- dum to the Congress. This memorial chal- lenged the official cost estimates in the4947 report, charging that the Sea-Level Project would cost several times its initial estimate — 82,483,000,000— and that the Third Locks Project adapted to the principles of the terminal lake proposal (widening Culebra Cut excepted) can be accomplished at rela- tively low cost as compared to that of the Sea-Level Project — estimated as under $600,000,000. The statement also criticized the 1953 pro- gram for repair and alteration of present lock structures as makeshift in character and without sufficient merit, pointing out that it will delay the fundamental and long-overdue solution of the problems in- volved. It stated that the Governor's recom- mendation of none but the Sea-Level Proj- ect for major increase of Canal facilities served to exclude what may be the best solu- tion when evaluated from all angles. Included in an address to the House by Representative Eugene J. Keogh of New York" this memorandum was promptly recognized by the engineering profession." Strong appeals for the creation of a wholly American, independent, broadly based, pre- dominantly civilian, strictly nonpartisan and objective Interoceanic Canals Commission, composed of able men who may not be domi- nated or unduly influenced by Federal execu- tive agencies, have been made by responsible Congressional leaders as the best means for developing a wisely-reasoned Isthmian Canal Policy." ""Panama Canal Construction Engineers Favor In- teroceanic Canals Commission," Congressional Record Vol. 100, No. 79 (Apr. 29, 1954), p. 5491. " "Panama Canal Problem," Cinl Engineering, Vol. 24 (JlIv 1954), p. 460. »H.R. 8457 and H.R. 8458, 82nd Congress, H.R. IWS, 83rd Congress, and S. 766 and H.R. 3335, 84th Congress. The consequences of prolonged arguments, in and out of the Congress, have been to- wards restoration of economic thinking and an increased appreciation of fundamental planning concepts so -well expressed during the 1905-06 "battle of the levels" by General Henry L. Abbot, the great student of the Chagres, member of the Comity Technique of the French Panama Canal Company and the international Board of Consulting En- gineers, and an advocate of the high-level typie. His words were: "The true criterion is ease and safety of transit, and . . . this test leaves no doubt as to which type of canal should be preferred at Panama."" This standard, both obvious and simple, is as true today as it was when written in 1905. More- over, it is applicable in evaluating not only canal proposals at Panama but also those at other locations. Diplomatic Implications The juridical basis for the Canal Zone rests with the Hay-Bunau-Varilla Treaty, which authorized a zone ten miles wide ex- tending five miles on each sid« of the center line of the canal. After extended diplomatic discussions, the boundaries of the Canal Zone were later fixed in the Price-Lefevre Boundary Convention of September 2, 1914. An examination of the general plan of the proposed Sea-Level Project discloses a num- ber of features not covered by current inter- national agreements. Among thtse are: a new main channel alignment substantially removed from the existing channel from which Canal Zone boundaries are measured; flooding of additional territory in the Repub- lic of Panama in the Chagres River valley downstream from Madden Dam (Alhajuela) ; diverting the Chagres River from its present path west of Limon Bay to a new path east of th" bay that crosses a Panamanian high- way; and draining the central portion of Gatun Lake. The last feature would disrupt present navigation channels to Panamanian settlements on the lake and uncover large and forbidding swamp areas with resulting health and sanitation consequences. These aspects of the "sea-level" under- •• Henry L. Abbot, Problems of the Panama Can I. (New York: MacmilUn Co., 1905), p. 224. 426 274 U. S. Naval Instilute Proceedings (March taking would undoubtedly bring a demand from the Republic of Panama for a new treaty covering the specific conditions for its construction. What concessions such a treaty would cost cannot be predicted. But, based ufton previous experience in such dip- lomatic negotiations, these costs would be far greater than earlier ones, inevitably adding to the total estimate and increasing tolls. Furthermore, such negotiations would be fraught with considerab'e uncertainty in the relations of the United States with Panama and other nations of Latin America, not to mention threats to the security of the enter- prise through the process of its international- ization, for which there have been persistent demands. '- -^•^:,"- ^ ■;y^; ^^; ■ :■ •. .^•■ "- -- In contrast, the Terminal Lake-Third Locks Plan, being merely an "enlargement of the existing facilities'"* that does not call for additional "land or waters" or authority, will not require a new canal treaty. This, it must be obvious, is a truly paramount con- sideration. ■:-,.^;-,^;V.^ '■, ^ • ■ -'^ ■':"/.''■■. The construction of a canal at another location would introduce an entirely new diplomatic situation, which would be just as complicated as that at Panama. - v The salient elements of this situation, however, are: that the 1947 report does not present these significant diplomatic involve- ments; that the need for negotiating a- new treaty with Panama to cover the Sea-Level Project was not submitted to the Congress; and that the Congress has not authorized such negotiation as was done in the Spooner Act of 1902 for the original construction of the Panama Canal. ... Isthmian Canal Policy Must Be Re-Determined The evolution of Isthmian Canal Policy has. been slow. Its principal objectives have long been the best type of canal at the best site for the transit of vessels of commerce and war of all nations on terms of equality as provided by treaty — and at low cost? df 'con- struction, maintenance, operation, sanita- tion, and protection. Often beset by bewildering confusions of ideas, the progress of fundamental concepts has, at times, deviated from their logical « Hull-Alfaro Treaty of March 2, 1936. Art. H, courses. Yet events have thus far conspired to avert irretrievable error. Now, with the main arguments clarified, the interoceanic canal problem in its national relationships is coming to be better understood and atten- tion is focusing on the true objectives of se- curing requisite capacity and operational efficiency. Nevertheless, the evolving situa- tion is of such grave concern that it must be protected by ceaseless vigilance and fully matured objective judgment. The Panama Canal is now entering its fifth decade of operations. Its navigational inadequacies have been established.. The canal as completed contains fundamental errors in operational design centered on the location of the Pedro Miguel Locks. These can be corrected only by the major recon- struction of the Pacific end of the canal as contemplated in the Terminal Lake-Third Locks proposal. Commercial traffic through the canal has reached the highest volume in history. The Navy has vessels that cannot transit. Issues raised by questions of "security" and "na- tional defense" have been formally sub- mitted but never accepted. The principle of economic operation of the canal has been em- bodied in law." Yet, in a physical sense, the shipway is still essentially what it was in 1914. Thus, the time has come to provide, without further delay, the additional inter- oceanic transit capacity and operational im- provements to meet present and future needs. The solution of this problem is not the sim- ple proposition that it may appear. Instead, it is a highly complicated one of the greatest national importance, rising above purely personal and group considerations. It in- volves questions of fundamental operational and engineering planning, the decisions on which will affect the welfare of the United States and other maritime nations through the indefinite future. These facts call for a further re-assessment of the entire interoceanic canals problem" based on realities, with a comprehensive re- " Public Tjiw 841, 81st Congress, approved Septem- ber 26, 1950 (64 Sut. 1038). " Thompson, "Interoceanic Canals Problem," Ccn- gressional Xaord, Vol. 98, Pt. 8 (J""- 15, 1952), p. AIM. 427 1955] Islhmian Canal Policy — An Evaluation 275 sialemenl of Isthmian Canal Policy as de- the task that sooner or later the Congress rived from a reasoned line of action. This is and the Nation must meet. 428 [From February, 1{>47, Publication] AMERICAN SOCIETY OF CIVIL • ENGINEERS Fonndcd November 5, 1^52 . \ PAPERS THE MARINE OPERATING PROBLEMS, PANAMA . CANAL, AND THE SOLUTION By Miles P. DuVal,* Esq. ■ f ' Synopsis Reconstruction of the Panama Canal to facilitate its operation and to increase its capacity is imperative. The present design is a high level water- "W&y, 85 ft above sea level. An improvement near the Pacific end of the Canal to provide a high level terminal lake analogous to Gatun Lake on the Atlantic side is discussed in this paper. The need for the change is explained, based on marine operating and safety considerations. The solution proposed is th6 physical removal of Pedro Miguel Locks, the construction of all Pacific, locks in continuous lifts near Miraflorcs, the elevation of the Miraflores dams, and the creation of a high level anchorage north of Miraflores. Navigational rather than engineering features are stressed. ' ■, .'■■■':^^:- >:' '■ ' ''. • - " This paper was originally presented before a meeting of the Panama Section of the Society on May 20, 1043. The opinions and recommendations are purely personal, and have no official connotation. • > . * .-. '-,;<*. ,' . '■■•'■ ■ ■ -.•; ■ ■■■ ,:,--' :.■>.: r. : :; . - • ■■ ■'■:»; ■; • -' '^,\^ •',..: ■■■:-:-r: ■■ • :*'<« Pkisent Canal Operating Plan Any mariner's first transit of the Panama Canal is always a memorable experience. Although he may know only a little of the history of this great waterway he is always deeply impressed by the magnitude of the Canal and the quiet efficiency of its operation. His ship passes through the Atlantic (Caribbean) sea level section (Fig. 1) and enters the three-lift Gatun Locks. The ship is locked up to the summit level in one continuous operation. After traversing Gatun Lake, it enters the tortuous and rocky artificial gorge known as Gaillard (formerly Culebra) Cut. At the south end of this cut the vessel enters the single-lift Pedro Miguel Locks and is locked down to the intermediate-level Miraflores Lake. It then enters a Vi Tiu iiiiifii III iiiii'i I f 1 I r II (i"^- ■! 11 hwHi I •••! - " li ' 1 0»pt, U. 8. N«Ty D«pt., Waahingtoii. D. C.; formerly Capt. of Port, Balboa. Canal Zone, March, 1941, to Jun«. 1»44. 429 Many Bhipraasteris observe thei Canal and jthe lock arrangemenU closely- '- , Instinctively they no^^ihat only olie lock structure was placed on the Atlantic ' |4de,;ind they wonder why two sets oflocks are needed on the ,Pac|fie mde So . what they feel is ah improper. manne arrangeqient. They would' prefei^ obub !\ stiticture on the Pacific ad a^^Gatun -to avoid (1) wowing ^heir vessels ii]i;a/^ rocky gdrige and (2)fundertaHng 'dou|)l^han4Ungr:^'^^^|^^fe^4^:^f^|^^ ^^0' ^*;^* Maaters genpraUy'(io ^^ thelong history of *the ^ahal nor the gr^t" rstrugglesinyplved^in its building;^ theyyare reminded ihat,\hi8 idea pi singlcH^' vlock structures at^tt^jPacifip 'terminus ia-not pew^^d that ,it. was cdMiderai;; r<)unjag^eonstructionJ|bVi'haid toWdikcarded because It was claime foundations were not available and because no' other solution seemed possible.; :Thi8 explanatioj^ is.'accepted;" itnd a . transit is . U8pally_sufficient to^unprdss ; ^masj^rs with so^e'pf ,ih/e; ihannei pV^))|eiM Vffecti^^^^ :^*]f , The principjir^marine^problems^re th^ traffic bottlei^jQck *^ ^^^j Migurf^ i, VlQckage surges in.Gaillard <^t» fogs^ cuh-lnts) «^ ^9^^x ^j^ljisl'.; Only^a^tM with' jthe.Canal and lijlose ob^rvation do sMp^'' ^SoaBteijB comprehend fully^the nature of the operational difficulties and haza^ K^ir/ In addition, to the inherei^t hayigational problems pf^ a restricted waterway,X- the physical layout? o^, tKe 'CaHarfor operation is pot symmctricai^ ^On .the . '.Atlantio eide 'tdere is a ciapftcious summit bvel anchorage in:Gatun,Lake.where,; 430 ^vessels bound ioi' either direction can anchor safely until ready to proceed. v^^'Such favorable facilities do not exist on the Pacific side. The Pedro Miguel ^•IjocikB are located squarely at the south end of daillard Cut, with- no summit k^Jeyel anchorage available as in Gatun Lake. These locks serve as a timing '^^'deyioe that restricts the use of the cut to the capacity of the locks, and thus limit the capacity of the Canal. ^j; .^ /- *^" ' >cs' ''^'/.['■^'^'-^' \ ' -: ;; .^1,>^ In spite of these inherent problems, the Canal ha« operated successfully C'but it. has operated under difficulti^. Northbound vessels enter the cut at ( .i? lockage intervals and no faster. Southbound vessels cannot arrive more rapidly 'than the locks can be readied.to receive them. , Hence, the Canal has not been ' ;; able to develop its maximum obtainable capacity. . "j V • ^'^.1^"'; ■ n>' -"^^ -' '• -' ^^ vt|f^\., This" condition can be illustrated by examining a day's traffic in the Canal,, ^^' under the restricted conditionsi^j; Vessels start transits on both sides of the "/Isthmus simultaneou^ly, arriving at Gatun Locks and Miraflores Locks about •{/7lOp a.m; ^Northbound vessels are locked up to the summit level continuously t^ until all northbound traffic has passed Pedro. 'Miguel Locks. .Then each proceeds in succession at lockage intervals through the cut into Gatun Lake f and thus to Gatun where it enters the locks or anchors to await down lockage.. ;. Southbound vessels are locked up to Gatun Lake where they anchor at^ Gatun ^tanchorage pr wait imder way until they are scheduled to enter the cut..., After^, . .the horthltound traffic clears Gailla^d Cut at.Gamboa, the southbound vesseb ,3- irpiced' at _Iockag(i mtervals enter.' ^h^ 'cut. .' J_ ,.,_ . >/"; V;C%>' vV''iij^-'^-l^'^''^ ;'iW ■>/^2riThus, Gatun anchorage supplies a stopover station ibr both northbound and ^vj^uthbound, vessels ^d permits flexible operation of Gatun Locks. 'At Pedro k'Jifnguel there is no comparable anchorage to enter. Vessels have to approach ;.\iji<^ locks in a relatively narrow and rocky passage; they cannot anchor for i/;tiiey, would swing into the bank;..they cannot slow too much because of the ^'^^auecessity of maintaining steerage way in a narrow rocky gorgd which in the dry 'Jsed^on is subject to high winds in the daytime. , Thus, vessels must Ibe received ' "as they arrive and tiiey cannot arrive taster than they can "be received. This ^t^situation creates immense ship handling and traffic control problems tiiat cause ^ ^tVi^ys and at times subject both the Canal and the transiting vraselsio danger., ;;f ^^H.For jEu^ilne opera^ons the location of the l^edro Miguel Locks at the end I is the capacilgr of the Panakna Canal? Obviously, if the summit I'Vaier ^pply ia ample, it is the capacity of the locks. Because of the bottle- ^Itieck at Pedro Miguel Locks, .their capacity measures that of the CanaL;' ^ ; 1^ :^?i^.' Assuming that one side of the P^ro Miguel Locks is in operation during 'Biennial overhauls and that the lockage interval for single culvert operations ;^u fi3| min, the 24-hour capacity is twenty-seven lockages. This figure has }beeii accepted as the miniinum capacity of the Panaioa Canaf. .r ^ -> ^^"^^^"^^ V 'A more complete picture of canal capacity was presented in a study by the ,^' Locks Division of the Panama Canal in 193S (Table 1). Two, methods of i (ipetotinf the Gatun Iiocks are noted^. In the one designated /'normal", a 431 164 MARINE OPERATINO PEOBLE1C8 Papert vessel enters a lock after the vessel ahead has cleared the distant chamber; in the "follow-up" operation a vessel enters a lock chamber before the preceding vessel has cleared the last chamber. Thus the vessels are always separated by one lock. It should also be mentioned that the filling may be accomplished by the use of either single or double culverts as shown in Table 1, for each lock has two sets of culverts. TABLE 1. — Capacity of Sinole Loc^s, Panama Canal; Based on Sttjdt by Locks Division, 1938 Lodk Total 24-Hr Capaott Sngle colvert Double culvert Single culvert Double euhrert Gatim: M 91 53.6 60 40 7« 87.6 48.6 26 10 27 24 35 19 38 20 Thus, the lockage capacity of the Panama Canal is lowest during the over- haul of Miraflores Locks, with the rate of one lockage an hour. This capacity is based on uninterrupted lockages and disregards the effect of certain other important factors to be discussed later. It represents the maximum capacity of the Canal under the most restrictive lock operating conditions — that is, during periods of one side operation at Miraflores when under overhaul. ' ' Effect op Foo Fog is one of the most frequent and serious interruptions of traffic in the narrow reaches of. the Canal. The channel between Pedro Miguel and Bohio is subject to dense fog at frequent intervab, especially in the wet season. South of Pedro Miguel and likewise north of Bohio fog seldom occurs. Both Gatun and Miraflores Locks can operate on a ■24-hour basis under favorable weather conditions because both Gatun Anchorage and Miraflores Lake are relatively fog free. Vessels can lock up from the Atlantic to the summit level and anchor safely at Gatun anchorage without interruption, day or night, and similarly at Miraflores Lake. In fog, vessels cannot enter Gail- lard Cut because of the danger of striking the bank; but when Pedro Miguel Locks are clear, northbound vessels may lock up to the north approach wall of the locks to await the clearing of fog in the cut. After the north wall is filled to capacity, all north traffic must st6p. Few persons not directly concerned with the control of traffic in the Panama Canal realize the frequency with which fogs affect marine operations. In 1942 there were two hundred and twenty-three fog reports from marine signal stations in Gaillard Cut during traffic hours, but only .113 fog days. Conditions are worst during the wet season-^May to December. Fog forms after 9:00 p.m. but normally clears by 8:30 a.m. . The canal capacity is thus reduced from the rated lock capacity at Pedro Miguel to the lock capacity during favorable weather conditions in the cut. 432 February, 19^7 MABINE OPEBATINa PROBLEMS 165 Dtuing periods of long fog duration the capacity is less than the previously assumed minimum of twenty-seven ships a day. Tbaftic Restbictions * ■ • For certain types of vessels, the Panama Canal has strict regulations re- quiring one way traffic in Gaillard Cut, known as Clear Cut Rules. Ships laden with explosives, oil tankers, unwieldy vessels, ore ships, large warships, and largest merchant vessels are dispatched only when Gaillard Cut will be clear of vessels to pass. For reasons of safety, traffic in the opposite direction is delayed while they transit the cleared cut. As a result the capacity of the Canal is still further reduced, particularly when the traffic does not arrive at times convenient for safe and prompt locking. The physical layout of the Pacific locks prevents any compensatory routing of vessels in groups that would overcome these delays. ^ Accidents in the Panama Canal In connection with the writer's duties when he was Captain of the Port, Balboa, Canal Zone, the records of all accidents in the history of the Canal that had been formally investigated ^ were examined and indexed. TABLE 2. — Number of Lock Accidents, The revelations were impressive. Panama Canal, Formally Inves- The most serious were found to tigated Between January 13, be lock accidents, groundings, "1922, and July 13, 1942 commons, and accidents result- ing from steering gear failure. The study showed that they tended to occur at definite places, and these danger spots were determined. Of a total of one thousand and thirty-six accidents formally investigated between January 13, 1922, and July 13, 1942, three hundred and ninety-three were lock accidents (Table 2). The most serious were caused by striking the sharp comers of the lock wing walls or ramming them. • Groundings in Gaillard Cut are feared more than any other type of accident. When a large vessel strikes the rocky bank, the hull may rupture and the vessel may sink and close the Canal. The records are notable especially for the in- creasing record of sinkings; out of a total of seven sinkings in the 24 years from 1919 to 1942, five occurred in the final 6 years. Collisions in the relatively narrow waters of the Canal are likely to be serious, — especially in Gaillard Cut where the banks are rocky. During this same period there were fifty collisions in the canal channels, of which Gaillard Cut contributed twenty six, causing one out of four sinkings. Steering gear failure is always on the mind of a master when his ship is in close waters. This has been one of the most prolific causes of groundings and Lock Enter- ing In chain- ben Depart- ing Nftme Nmn- berof oham- ben Total Gatun . . . . Pedro Misu«l. . Miraflorea 8 1 2 87 79 M 41 15 38 24 44 19 152 138 103 433 166 MABINE OPBBATINO PROBLEMS Paperg collisions. Of the one thousand one hundred and eighteen accidents during this same period, one hundred and ten were due to this cause. Steering gear failure in Gaillard Cut makes grounding or collision almost inevitable (Table 3). Obviously, the cut is the most serious danger spot in the Canal. TABLE 3. — Accidents Caused bt Steering Gear Failubx; January 1, 1919, to July 19, 1942 Ymt Anjumc Ska Lbtk. Gatuit Basbacoa* GAiiXAmo - CXTI MiTA fiorea L*ke (eoUi- ■iona) Pacific Sba Lbtil To(U Oround- Colli, •ion* Ground- ColU- aiona Ground- ing! CoHi- aiona Groimd- ingB CoIIi- ■iona Grousd- ingi Colli- aioBa 1019 1920 19S1 1922 1933 1924 1926 1928 1927 1928 1929 1930 1931 1933 1933 1934 193ft 1938 1937 1938 1939 1940 1941 1943 ToUl Y 1- 1 1 3 ° 'i* 1 T V Y Y 3 Y I- T T 1 *8 8 *i 'i. • *i *i 1 10 3 'i 1 • 4 3 . ft 3 4 ' 4 . 1 2« 3 1 1 4 'i 1 *3 • 1 . 1 3 45 1 1 Y Y 1 3 Y Y 9 'i '3« f I. ' 1 *i« 11 '2« .2« 13 4 2 3 1 - 3 8 11 13 ft 10 ft 4 ft -, 3 3 4 1 4 5 3 4 • 1 3 110 * Groundinc or eoUiaion not specified Ux one ( The failure of steering gear is not by any means the only cause of serious accidents. Another is the phenomenon known as bank suction, experienced by vessels moving in narrow channels or close to walls. Wall or bank suction often causes grounding as vessels depart from locks or as they pass salients in Gaillard Cut. Usually suction causes a movement of the ship's stern toward the closer bank, center wall, or salient. If the pilot is unable to break the resulting sheer, the vessel may get out of control, strike the wall or bank, or ground on the opposite bank. In a study by the Panama Canal in 1939, the positions of many groundings were plotted. They tended to occur at bends after the turns were completed, and in some relation to the degree of curvature. The larger turns had the larger number of groundings. ' The subject of groundings has not been exhausted. It is a large field for a detailed study that should be undertakeh — leading to a scientific determination of necessary changes in alinemcnt of the channels. Lock accidents have demonstrated the need of modifying the wing walls of the locks so as to eliminate the sharp corners at the lock entrances. The 434 February, 1947 MARINE OPERATING PROBLEMS '.'"■■■ ' ' - '■' .■-■'■■■-■■■:■ •■ •,::> >■.■■''<,"('-■''',.[' ^'-ri;^-^' record of lock accidents and groundings shows that the separation of the Pacific locks into two structures has caused more accidents than would have occurred had the canal plan provided a summit level terminal lake on the Pacific analogous to Gatun Lake on the Atlantic. - 'J rV'.;^ >' . The perspective of a quarter of a century of marine operation shows that the separation of the Pacific locks into two' structures, the location of Pedro Miguel Locks at the south end of Gaillard Cut, and the failure to create a commodious summit level terminal anchorage on the Pacific, are the great marine operational ' errors in the planning of the Panama Canal.' vj, ^ ,v ^ • ' . 1 -' -V/' . - ■ i, ■"•.'.>■. .' ■. • •> .J- . ." ,- ' The 1939 Third Locks Project -. ,<'.:•:/ ,' " Canal authorities have looked forward to increasing the capacity of the ' Canal for many years and have made several studies of the subject. Howeveri not until August 11, 1939, was construction of the Third Locks Project author- ized by Congress, in those months of hectic activity preceding World War II. Gatun By-Pass Gatun [-Anchorage (El +85') ii^iJlV v/i ■«««««« -:-Wi:::'^ ;■, lun T rj^u o u $^ Cot ^.,y^^i--TJCl4-55i\ r 4 -r-ntAnchora ge (El -.-85'), ^.^^^^ - ^^, ^ ^^' V^^^^-r~~^V:> ^ ' > u) ^ocks , ' V. ', • ; ^4>-*-47» - :^ - "'"^^^r-^ Bait Three ^,. ,-^.^.y- .^**Wa • ' a > ..-i vX ^^^^ ""-\Hari Ball>oa iwr i.^ .."■- ■;/':••-":/;■■-: - -^ -' v.. ,V-,"l '-''',-,:•'-::-, . ■:•■^''■.^'^;■■:^. ■.-■:'•'-■'■■' ,''.^>^ . ' 10) BEFORE (SHOWING THE BY PASS PLAN Of THE 1939 THIRD LOCKS PROJECT) ' ' '■ . Gatun ^ Locks 3ea LeveK Three Lifts iJ*A ■' • • :'■'■' X.- :,■ -V..' '■■ ii'i ■'•■.. v_ ■' ;•' ' ■^' ■■'t\-\J'''^ — -^'HarlXK <*) AHER (SHOWING THE HIGH LEVEL TERMINAL LAKE PLAN) Fto. 3,— ErracT or AoorriMa tbs TuaaKU, X.ak> Plav ,.^ The purposes were to increase the capacity of the Canal, to permit the transit of large naval vessels, to attain a greater security from bombing attack, and to facilitate conversion from a lock tjrpe canal to a "sea level" canal. ' ^ The earliest plans for a third set of locks placed the locks alongside the . existing structures. The approach of the war and the restating desire to dis- perse lock structures because of the danger of bombing caused the adoption of a plan in which the new locks were placed at a distance from the present struc- tures and by-pass channels connected the new locks with the main channels, as shown diagrammatically in Fig. 2(o). Except for the segregation of the new locks, the 1939 Third Locks Project represented no fundamental change in the canal plan. It was in principle an acceptance of the present canal arrangement. '.^X.i'"-^-:^C'-^--J- ^^;v.v 435 168 M ARINB OPBRATINO PROBLBBfS PaptTM ■ ^ . _ • ■ . '..'.■.. Its completion would have perpetuated the bottleneck at Pedro Miguel and would have delayed indefinitely any chance of solving the navigational prob- lems of the present Canal. Instead of improving and simplifying the Canal, part of the project added certain features dangerous to operation. The proposed new by-pass channel at Pedro Miguel would intersect the present channel near Cucaracha at an angle of 28° 59'. North of the proposed new Pedro Miguel Locks there would be a turn of 46° 17' in the by-pass channel; and, in Miraflores Lake, still another turn of 37° 30'. The experience of a quarter of a century has demonstrated that the pro- posed by-pass channel north of Pedro Miguel would be definitely dangerous, ' and that it should be abandoned. This channel will not simplify or improve the operation of the Canal; on the contrary, it will complicate the existing situation. The turns of the new channel and the intersection of the new cut with Gaillard Cut would become new foci of accidents; create the most diflficult marine operating problems; and make transit of the Canal more hazardous. Fortunately the suspension of this 1939 Third Locks Project in 1942 occurred at such a stage as to afford an opportunity to re-examine some of its dangerous features.' ..■ _ ■'■ /- .. ^.- ^ ■ Sea Levkl Versus Lock Type Canal ;. There has been so much discussion of the so-called "sea level" canal as3n assumption in the planning of the evolution of the ultimate Panama Canal . that an examination of this proposal is essential before focusing attention on the fundamental marine problems that should be solved. The idea is not new. The alluring prospect of the "Strait of Panama" is an ancient historical con- ception that has had great public appeal. This idea has even been symbolized in the Canal Zone seal which shows a Spanish galleon sailing through Culebra Cut into the waters of the Pacific. - Statesmen have made many eloquent speeches setting forth the assumed advantages of the sea level canal over the ^ lock type canal. Yet, in spite of all the rhetoric, a lock type canal was adopted mainly through the efforts of the late John F. Stevens, Hon. M. and Past- President, ASCE. It was completed by the late George W. Goethals, M. ASCE. , .,■:-■.' -. . • '■ ■ :., In a recent comparative study of the marine features of the sea level and lock type canals, it was assumed that the sea level canal would follow the same, general route as the present Canal; would have approximately the same form; would contain a tidal lock at Miraflores; and possibly would have an anchorage or mooring basin north of Miraflores. In effect, such a waterway would not be a sea level canal but a tidal level lock canal. The conclusions as to the effects on navigation were that the low level lock canal would: - ■ . ' * , ' (1) Extend the length of hazardous channel from 7.69 to 31.18 miles; (2) Increase the number of critical curves (20°+) in the hazardous channel from 2 to 12; (3) Increase the total curvature in the hazardous channel from 129° to 664°: 32-461 O - 78 - 28 436 February, 1947 mabine operatimo problems^ li69 (4) Probably extend the channel length subject to fog; / • , " (6) Probably curtail operations during fog periods; (6) Require the use of ship mooring stations; ^ (7) Extend the collision, grounding, and steering gear failure area con- siderably; .(8) Increase the number of transverse' streams; -,'' (9) Reduce pilots' vision; ^ - (10) Increase the time required for transit; ' . . (11) Complicate the traffic control problem; (12) Subject the Canal to the dangers of great floods in the Chagres Valley; '■ ., ■' ■■ and '' (13) Reduce the general navigability and operational convenience. There is only one appreciable marine operational advantage for the "sea level" canal and that is the elimination of the Atlantic locks and the consequent reduction of lock accidents. In comparison, the operational advantages of the lock type canal are overwhelming. ,:• - . - , ' \ .-;■' ;• To Solve the Marine Operating Problem !. .- ' The principal marine operating problems of the present Canal have been described. The way to overcome them is to remove Pedro Miguel Locks from their position at the end of Gaillard Cut; to create a large summit level anchor- age in an elevated Miraflores Lake; and to concentrate all Pacific locks near Mifaflores in continuous lifts. These changes automatically correct most of the operating problems. This High Level Terminal Lake Plan (Fig. 2(6)) is fundamental from the operational standpoint. It will supply the best canal for handling ships. ' ' . f^ • * The land contours of the Miraflores Lake basin are suitable as an impound- ing perimeter for a terminal lake on the Pacific and will require relatively small dams and dikes. There are several possible lock arrangements. Of these the best marine arrangement is the one in which the present Miraflores Locks are abandoned and all the Pacific locks are placed on a new site that will utilize in someway the excavation for the by-pass locks at Miraflores (Fig. 2). The general layout and relationships of this terminal lake, as of May 9, 1946, are shown in ilg. 3. . • v -' 1 ^ ; : , '' v' The summit level anchorage (Fig. 4) is of greatest marine interest to those chi^rged with the operation of the Panama Canal. It contemplates nine 300-yd berths and thirty 200-yd berths, to be obtained by dredging certain areas. The areas of the several berths, classified as to depth, are as follows: Depth Area . 'fft) (aqmilea) 20 , 0.23 . - 30..... .....:.. 0.13 •; 60... i.. -. .v.. 0.38 ■7 • ' Navigation channel. .0.29 . . ■"''"^';'i ■--■': ' Total...... ^.. ■..';■;. \.'. .'.!.;:.'./;;';■.';. ■..1:03 ■ ■■ 437 170 MARINE OPERATINO PROBLEMS Paper* '\^ The number of berths in this anchorage should be sufficient for the present traffic even without dredging. ": ^ The essential points of the Terminal Lake Plan for the improvement of the Canal are the removal of the bottleneck Pedro Miguel Locks from their posi- K^^e* Boundary qf,,^ Ceffo .^*s;c~^t^» Dam Jp> New Mirafkjre*^^ Miguel 2 f ^^y/iore» -L.«?chorag«. r,g, 4) 7/ % \*. (Triple) Locks r .l.J{*- ..'■■....;.. Flo. 3. — Plah FOB THB iMPBOTUfXMT or Panama Cavaii tion at the end of Gaillard Cut and the creation of a large summit level anchor- age on the Pacific side. The lake is the key to the solution. ' • "* ' Marine Advantages of the Proposed Plan Anyone who has made many transits through the Pacific locks, viewed the Miraflores Lake from near-by vantage points, or studied the operating sheets, weather reports, and accident records, cannot fail to discern the tremendous advantages of the Terminal Lake Plan. Among its marine advantages are that it: ', ■•'"■■■..'■' ' ■ -^>- ■, '■.'-'.-■■" ^ (1) Improves and simplifies the operation of the Canal; (2) Increases the capacity of the Canal; ... (3) Extends the useful life of the Canal; (4) Increases the summit level water storage by 50% to 75%, and the water- shed by 37.4 sq miles; . , 438 FeSruary, 1947 MABINE OPEBATING PBOBLEMS 171 I 439 172 MARINB OPEBATING PROBLEMS Paptrt (5) Provides a summit level anchorage between Miraflores and the entrance to Gaillard Cut; (6) Makes the operation of Pacific locks independent of fog; (7) Simplifies the problem of dispatching transit traffic; (8) Avoids the three large turns and consequent groundings in the 1939 Third Locks Project channel between Cucaracha and Miraflores which woi4d necessarily be traversed by the largest ships; (9) Eliminates one lock from the Pacific lock system and the hazards in Miraflores Lake during tue approach and departure of vessels to and from Pedro Miguel Locks; (10) Reduces the number of expected lock accidents at the Pacific locks; (11) Removes lockage surges in Gaillard Cut as factors controlling depth of channel; ' - (12) Simplifies the operations of the Pacific locks; . ^ (13) Reduces the channel maintenance operations; , ' » (14) Reduces the time of transit about 1 hour; (15) Enables a better distribution of Dredging Division equipment in event of slides; ^" (16) Increases the safety of transit especially for large war vessels; * (17) Enables a better handling of transit traffic in the event of slides; (18) Eliminates the lock silting problem in the present Pedro Miguel Locks; (19) Improves ship handling conditions in Gaillard Cut because of the elimination of surges and the increase in channel depth; and (20) Removes the dangerous traffic bottleneck of the Panama Canal at Pedro Miguel. > - * ' Other operational advantages could be added to this list. So far as known there are no operational disadvantages to this plan. The marine advantages of the Terminal Lake Plan are so extensive that this plan will have a tremendous appeal to the United States Navy and to all merchant shipping. The main engineering problems will be involved in the construction of the necessary locks and dams. A study of the topography shows that the configura- tion of the land is favorable for the creation of the terminal lake by dikes. Geological reports indicate favorable foundations for locks and dikes. The engineering features of the plan have been examined by engineers and have been given preliminary approval. All of them would have to be subjected to in- tensive and detailed study. . The cost of the Terminal Lake Plan, should not differ materially from the revised cost of the 1939 Third Locks Project. On the other hand, it is not desired to minimize the problems that will be encountered and that will have to be overcome. Among these are: (1) Inherent difficulties of changing an approved plan now in effect; (2) Relocation of sections of the railroad, liighways, and pipe and cable lines; (3) Removal of Pedro Miguel Locks; (4) Elevating the spillway and dams at Miraflores; (5) Foundation work at Miraflores; and (6) Maintenance of canal traffic during construction. 440 February ^ 1946 mabine opebating problems . ' 173 Nevertheless, the navigational superiority of the Terminal Lake Plan to the 1939 Third Locks Project on the Pacific end of the Canal is so overwhelming that it should be adopted even at considerable additional cost. It is the plan ^that will meet the marine operating requirements of the Panama Canal. It will make possible the construction of additional sets of locks at each end of the Canal. It should be the plan for the ultimate canal. HiSTOBICAL PeBSPECTIVB One of the first questions that is likely to be raised after this discussion is, "Why were these fundamental ideas not presented before this year?" The answer is that they were, but they were presented differently and by men with-, out marine operational experience. In recent years Ralph Z. Kirkpatrick, former Chief of Surveys of The Panama Canal, saw the weakness in the present canal arrangement and sub- . mitted suggestions. His' main purpose seems to have been to combine the •Pacific locks into one structure. His plans were not backed with the force of operating experience and were not adopted. "* Before Mr. Kirkpatrick there was the late Maj. Gen. W. L. Sibert, M. ASCE, . the builder of Gatun Locks. He wanted to place all Pacific locks between Cerro Cocoli and Cerro Miraflores in one structure as at Gatim. Although he had an excellent grasp of the needs for traffic, his main thesis was economy of construc- tion. His plan was investigated by a board which reported favorably. The • report was referred to the President of the United States who decided against adopting the change in the canal plan because the Pacific locks had been started; because it would have meant a delay in completion date; and because any modification would have given the enemies of the Canal an opportunity to seize it as an evidence of weakness in the lock type canal at a time when a political attack could have endangered the completion of the Canal. Before General Sibert there was Mr. Stevens. In 1906 he proposed the combination of all Pacific locks into one structure near Cerro Aguadulce with a summit level terminal lake formed by a dam between Cerro Aguadulce and Cerro de Puente. He was a transportation man and understood the operational implications of his proposal. Unfortunately, his investigations did not establish the existence of suitable foundations for lock structures. Also during Mr. Stevens* time there was the late William Gerig, M. ASCE, who developed the same idea independently of Mr. Stevens. Still earlier was the proposal of the French engineer Adolphe Godfn de L^pinay at the Paris (France) Congress of 1879. He had worked on the ^Isthmus and knew the problems that would face canal builders. With a plan of unbelievable simplicity he advocated creating large artificial lakes about SO ft above sea level at each end of the canal with dams as close to the oceans as permitted by the configuration of the land, and connecting these lakes by locks with the sea level sections of the Canal. The problem then would have been simply one of joining the lakes by digging a channel across the continental . divide. This is properly termed the high level terminal lake conception. M. de L^pinay probably was motivated by control of the Chagres River and the reduction of excavation, but he emphasized the navigational advantages of 441 174 MARINE OPERATINO PROBLEMS Paper* his plan. The conception .of this plan has brought an enduring fame to its author. ■ M. de Ldpinay's idea was not adopted until many years later, in 1906, when the adoption of the high level canal with a dara and locks at Gatun was secured mainly through the efforts of Mr. Stevens. Because there was no provision for a terminal lake on the Pacific side, the Canal as completed in 1914 was only a partial realization of the fundamental conception of the Canal as a marine operating unit. The Pacific sector of the Canal when opened for traffic did not conform to the requirements of the full de L6pinay conception. The Present Issue ^ . . The Panama Canal is again in an era of decision. A vast store of operating experience, not available to the early canal builders, is available for guidance. When the Canal was constructed, engineering considerations were the chief bases for decisions. Now marine operational requirements rather than en- gineering problems tire the factors that should govern decisions. Just as events forced the relocation of Bohio Dam to Gatun, to form Gatun Lake, the time has come to eliminate the Pedro Miguel Locks and Dam and to concent trate all Pacific locks near Miraflores to form a high level Miraflores Lake. Primarily the purpose of this paper is to present a historic ideal of the Panama Canal improvement in its modern conception, fortified by thirty years of marine operations. Discussion of these points should clarify, the whole problem: No claim for engineering or construction sufficiency is made or intended.- ■;"'' •. •' •■.'•'.■'•'■,•;•-.'■'•„ ';'■ ■ .""'^ •■■■'■•.' ' ■ '■' The issue is clear. The solution of the marine operating problems of the Panama Canal consists of (1) the physical removal of Pedro Miguel Locks from their position at the end of Gaillard Cut; (2) the creation of a large summit level, terminal lake north of Miraflores Locks for use as an expansion chamber for traffic; and (3) the construction of all Pacific locks in single structures at Miraflores. That plan should equip the Canal for ages to come. Those who bring it about will bestow a tremendous service on the naval forces of the United States and on the shipping of the world. They will be the real modern- izers of the Panama Canal. They will achieve the rare distinction that will rank them with the builders of the Panama Canal. ' 442 [From Explorers Journal. Pecember 1964] ENGINEERING: The Interoceanic Canal— A Problem* Despite some design errors, the lake-level lock canal has been remarkably efficient. by Miles P. Du Val The question of increased Isthmian canal facili- ties grows more urgent with the years. Recently neglected, the problem discussed in Captain Du Val's article merits renewed attention, hence this review. — Editor Canal Idea Dates From Age of Discovery, 1502 The idea of a waterway across the American Isth- mus traces back to the age of discovery when the first great explorer of the Americas was searching for a passage from Cadiz to Cathay. Skirling the coastline of Central America on his fourth voyage he left a trail of geographical names which have carried on through the centuries. Spending Christ- mas of 1502 and New Year's in Limon Bay he did not realize how close he was to the eventual solu- tion of the problem. Yet today, his fame is jierpet- uated in the names of the two terminal cities at the Atlantic end of the Panama Canal; Cristobal and Colon. Eleven years later, in 1513, another intrepid explorer, Balboa, crossed the Isthmus and dis- covered the eastern Pacific, then called the South- ern Sea. Thus was completed the historical setting for a series of geographical explorations which rapidly focused on the idea of building a canal across the land barrier that separated the oceans. Within an incredibly short time, with that objective constantly before them, the early Span- • •Abslracti-d from a p;i|HT ri-;ul l>y ilic jiithor In-fdrc Ttic Explortrs Cliil>. N'ovciiiIkt 13, 1051, ami riprinlol in the Congrrssionnt lifcord, January 15. 1952. ish explorers reduced their fields of investigation to four main canal route areas: Tehuantepec, Nicaragua, Panama, and Darien. Panama and Nicaragua Become Competing Routes, 1529-1855 Because of their lower continental divides and penetration by river valleys, Panama and Nicara- gua quickly developed trade routes over these two natural avenues and became the great comjjetitors for trans-Isthmian transit. The first survey for a canal at Panama was prepared in 1529; for Nic- aragua, later. Nothing practical, however, was accomplished until the Wars of Liberation of the nineteenth century ushered in a new era of explo- ration. At Nicaragua the solution of the canal problem, at first, appeared relatively simple for the transit of the small vessels of that day because Lake Nic- aragua and the San Juan River, flowing from it into the Atlantic, were navigable. These featines reduced the magnitude of that undertaking sim- j)ly to cutting across the thin strip sej)arating the lake from the Pacific Ocean. This advantage, coupled with the closer location of that route to North America, served for many years to make the Nicaragu;i Cianal projiosal the most f:ivored in the United St;iles. But the United Sl:itcs was not the only nation interested in seeming control of strategic c:uial routes. Great Britain, desiring to p:uticipatc at Nicar:igu:i as it did l:Ucr :it Suez, gained cuiUiol of the mouth of the San Jiuni. Thus, as e;uly in KXl'l.OKKRS JOHkNAl. / 215 443 llie ninctccnih century, the j)ioix)s;il for a t.Tiial across the Aiiieiican islhnuis became the subject of heated (Ii|>loinatit conlioversy between the two governments. This was not settled luitil 1901, when the Hay-Paiuiccfolc Treaty su])crsetled the earlier Clayton-Bulwer Treaty of 1850 that had deprived the United States of exclusive control of any Isthmian canal. Meanwhile the westward expansion of the United States gained in momentum. Private in- terests imder the inspiring leadership of John Lloyd Ste])hens, of New Jersey, noted explorer and most distinguished travel writer of his time, constructed the Panama Railroad, !849-55 — the first transcontinental railroad of all the Americas. As recognized by only a few at the time, that was the first constructive step toward building a canal at Panama. Completed while the United States and Britain were deadlocked over Nicaragua, the functioning of the Panama Railroad served to encourage the laimching of a canal project by others at Panama. French Start Panama Canal, 1879-89 Under the dynamic guidance of Ferdinand de Lesseps, the hero of Suez, private interests of France undertook this task. Calling a congress of 135 distinguished delegates to Paris in 1879 to consider the problem de Lesseps lent the full force of his tremendous prestige and his genius toward securing approval for a sea-level undertaking at Panama — a wholly different problem from that at Suez, where he had won his fame. One engineer — the only one in that Congress who had supervised construction on the Isthmus and knew some of its problems at first hand — rose in strong protest and warned of the dangers. He understood the topography at Nicaragua and how the elevated Nicaragua Lake would per- form an essential function in the construction and navigation of a canal at that location. He also knew the topogra|)hy of the Isthmus at Panama — the continental divide about 10 miles from the Pacific, the torrential Rio Obispo-Chagres flowing into the Atlantic and the much smaller Rio Grande into the Pacific, both through valleys suitable for the formation of lakes. Interpreting these surface features in the light of navigational needs as well as engineering, he recognized the application of the lake idea in the solution of the canal problem at Panama. Then with the vision and simplicity of true genius he proposed what he called a practical jilan for constructing the Panama Canal, here sumniari/cd: "lluild a dam at Gatun and another at Mirallores, or as dose to the seas as the con- figuration of the land permits. Let the water rise to form two lakes about 80 feet high; join the lakes thus formed with a channel cut through the continental divide, and connect the lakes with the oceans by locks. That is not only the best plan for engineering but also best for navigation." This was the conception of Ado]>he Godin de L^pinay. The profimdity and brilliance of this plan — the only plan which, at that time, could have had any chance of success — were not even understood and this great idea was ignored. The French, despite his emphatic warnings, launched upon their ill-fated undertaking. Ten years later, in 1889, their effort collapsed and the Isthmus returned to the jungle. Yet it should be here explained that shortly before this failure the French, to save money and time, had been forced to change their canal plan from sea-level to high- level lock. But that was too late. United States Attempts Nicaragua Canal, 1890-93 Meanwhile in Nicaragua, private interests in the United States started constructing a Nicaragua Canal. Though not as extensive as the French effort at Panama, this attempt, in 1893, likewise failed, ending all serious efforts to build any Isth- mian canal by means of private enterprise. Nineteenth Century Interoceanic Canal Political Pattern Thus toward the end of the century the pattern of interoceanic canal policies had been well estab- lished. First, there were struggles among com- peting sections for the choice of route; and second, debates as to the type of canal. In addition to proposals for canals, however, two other ideas of historical interest were considerctl: ship-tunnels through the mountains of Darien and a shiprail- road across Tehuantepec. Battle of the Routes, 1899-1903 In 1899 the United States, after a half a century of preliminary exjjloralions, started upon serious interoceanic canal investigations by means of an Isthmian Canal Commission, 1899-1901, headed by Rear Adm. John G. Walker, a line officer of 21fi / DtlCKMIlER, 1964 444 I'rcicnt lotk cnjinl ii iinsfinded, aud pioposed sealevel canal is shaded, on profile of Fmminn Canal. the Navy. Afiei a memorable legislative struggle. known in canal hibtory as the "bniile of the routes," the Spooner Act of 1902, auihori/etl the acquisition of a tannl /one in what was then a part of the Republic of Colombia, the purchase of the canal holdings of the French, and the construction of the Panama Canal with provision for the Nic- aragua Canal as an alternate project if unable to make the necessary arrangements at Panama. After many months of arduous labor the Co- lombian Charge d'Affalres in Washington, Dr. Tomds Hcrran. succeeded in negotiating a very favorable canal treaty for his country — the Hay- Herran Treaty of January 22. 1903 which was ratified by the United States Senate. March 17. 1903. Unfortunately in Colombia, this treaty became involved politically in Bogot.'l. The Colombian Senate, on August 12, 1903. against the urgent pleadings of Dr. Herran in Washington and the earnest efforts of United States Minister Arthur M. Beaiipr^ in Bogota, rejected the treaty, not- withstanding the fact that it had been ratified by the United States Senate. This action thoroughly alanned the leaders of Panama. Fearing that, after all, Panama still might lose the Isthmian canal to Nicaragua, they set out to prevent that possibility. The result was that Panama revolted on No\ember 3. 1903 and declared its intlependence of Colombia- Three days later the new republic was recogni/ed by the United Stales. France, the Nation which had started the canal enterprise, w.is the second; Great Britain and other nations soon followed. Events developed rajHtlly. On November IH, 1903. the newly appointed Minister of Panama to the United States. Philipi)e BunauA'aiilla, signed a new canal ircaiy with the Uniit-d States — the HayBunau-Varilla treaty. 1 his was promptly ratified by Panama, followed by the United States. aleil the choice of the Panama Battle of the Levels, 1905-6 Work under the United States started haltingly in the midst of increasing uncertainty as to the type of canal which should be constructed — high- level lake plan as contemplated in the final French plans or a canal at sea level, each idea having strong advocates. Arguments, often heated, centered upon the question of relative vulnerability of the types at a time when the most formidable weapons were large naval guns. Yellow fever on the Isthmus increased and, in the midst of chaos and confu- sion, the first chief engineer resigned. The project for awhile seemed destined for a second failure. President Theodore Roosevelt fortunately selected as the new chief engineer the late John F. Stevens, the great pioneer railroad builder and explorer. Mr. Stevens' qualifications for this work were unique. He had read everything on the subject since the time of Philip II, had built railroads in the Rocky Mountains, and had supervised o|>en mining opeiations in Minnesota. Thus, in his experience he had witnessed what occurs when the balances in nature are alteretl and hence tmdei- stCKxI the slide problems inheicnt in the excava- tion of a navigation channel through mountains. Aniving on the Isthmus on July 25, 1905, at the height of the crisis, he had matters under control within 2A hours. Expeticnced as he was in large undertakings, he promptly proviiled housCN for employees, organi/cd cunnnissarics, encoiH.igeil sanitation, ordcied new equipment, plannctl the trans|K>rtation system, and formed the basic tonsiruction oigani/ation for building the canal. Indectt. so rapid was his progress that he found himself ham|>ered awaiting decision as / L'I7 445 to the type of canal then being considcied in Washington by an international IJoaul of Con- Mihing Engineers. In its report of January 10, 1905, this Board split — eight members, including five Einopeans, voting for sea-level; and the five remaining Ameri- cans voting for the high-level lake and lock plan. Meanwhile at Panama, Stevens had walketl through the entire length of the canal route ex- jjloring its features, and studied the jMoblem in all its major aspects. Interpreting the topography of the Isthmus in the light of navigational re- quirements as well as construction he decided upon the high-level lake and lock plan as the only logical solution with a conviction nothing could shake. Testifying in Washington before congresssional committees in January 1906 he voiced his deter- mined opposition to the sea-level proposal and strongly advocated the high-level plan. But that was not enough. In June Stevens was again in Washington leading in another memorable canal struggle, later described by Col. George W. Goethals as the "battle of the levels." In this Stevens even more forcefully and fearlessly urged the high-level plan and opposed the sea-level proposal. In the end, with the support of President Roose- velt and the Isthmian Canal Commission, the ideas of Chief Engineer Stevens prevailed. Con- gress, by act approved June 29, 1906, adopted the high-level lake .and lock-type canal as proposed by the minority of the board of consulting engi- neers — essentially the same plan as that first so eloquently advanced 27 years previously by Godin De Lipinay. That was the great decision in building the Panama Canal, for the second time in canal his- tory, completing the pattern of interoceanic canal policies. The transit since 1914, in both peace and war, of more than 150,000 vessels of all types and descriptions has completely established the wis- dom of this decision. Pacific Lock Location Question, 1906 Chief Engineer Stevens, who was experienced in the ojxjration of railroads as well as in their con- struction, instinctively understood the need for the best operational plan for the Panama Canal. For this reason he never favored the separation of the Pacific locks into two groups as had been rcconimendctl by the minority of the board of consid ling engineers and, early in 1906, had urged the consolidation of these locks at one place as a desirable diange in the adopted plan. Finally, on August 3, 1906, he approved a |)lan which locatctl all Pacific locks in three lifts at Aguadulce, which is slightly south of Miradores — the same arrangement as that at Gatun. This, had it been followed, would have provided a sunnnit- level anchorage at the Pacific end of the canal to match that at the Atlantic end. Unfortiuiately, he was under great pressure to start construction because of a politically hazard- ous situation in the United States. Advocates of the sea-level proposal, stung to the quick by their defeat in Congress, were still poised ready to take advantage of a major change in the approved program as evidence of weakness in the high-level plan advocated by Stevens. Opponents of any trans-Isthmian canal at all were likewise seeking a means to delay the enterprise. The two together rejirescnted an economic and political force too jx)werful for anyone to control. Stevens' foundation investigations, necessarily made in great haste, proved unsatisfactory, and he did not dare to jeopardize the project by fur- ther delay. Twenty days later, on August 23, 1906, still confident that someday this important ques- tion would come up again, he voided his plan, marking it "not to be destroyed but kept in this office," and submitted the plan providing for the separation of the Pacific locks into two groups as recommended by the board of consulting engi- neers. Panama Canal Opened to Traffic, 1914 In 1907, after bringing the project to a point where its success was a certainty he resigned his jjosition and was succeeded by Col. George W. Goethals under whose able direction the canal was completed and, in 1914, ojiened to traffic. It should be recorded here that Colonel Goethals never failed to extend full credit to Mr. Stevens for his tremendous contributions to the canal project. Stevens, in turn, always strongly supj>orted Colonel Goethals, particularly at times of crisis, and likewise never failed to commend Goethals' work in bringing the luidertaking to the siicccssfid conclusion which won him and his associates great fame and made them great tradi- tions on the Isthmus. 218 / UKCKMHER, 1964 446 The litci.iuuc on the building of ihc P..ii.iiii;i Ctnal is \;ist. lis |);igcs ictoui ihc woiki of niiiny who i;cifoiniaI brillianily. Hul of ihcsc only (wo stand out as men of towering genius: Dc Le])in:iy and Stevens. For ni:iny years the (onlribulions of these two were not generally appreciated. Today, however, De L^-pinay is rctogni/ed on the Isthmus as the prophet of the Panama Canal; and Stevens as its basic architect. De Lcpinay has not yet been otherwise honored but the work of Stevens has been accurately interpreted by WiHiain Andrew Mackay in the mural in the Roosevelt Memorial Hall of the American Nfuscum of Natural History in New York. Defense Questions Become Paramount During the planning stages of the Panama Canal, both French and American, the objective of re- sponsible engineers was the case and safety of ship- transit, combined with economic construction. After the opening of the canal to traffic, however, the great builders left the Isthmus for other tasks and the project became imcrjiically acceptetl 0|jeration and maintenance became mere matters of routine. With the rapid development of the airplane and other motlern weapons following World War I, questions of defense gradually became subjects of increasing concern to engineering planners; those of operations, secondary. tliird Locks Project Started and Suspended, 1939-42 With the approach of World War II. Congress in 1939 autliori/ed the construction of a third set of larger locks, primarily as a defense measure. The plan provided for locating a set of new locks near each of the existing locks at some distance away to afford gieater jJioteciiou from bombing through dis|>ersal. The new locks were to be joined with the existing channels by means of bypass channels. The autliori/ed cost was 5277,- 000,000. significantly, the piojcct description included a number of fcatuies for the futiuc con\crsion of the canal to sca-Icvcl without siwcifu audiori/a- tion by Congiess. Discerning students (if (he sub- je< I. however, ictogni/ctl the impon of this iiuhi- sion and aptly described the thiid huks piojcit' as icsui letting ihe "old baiile ol the levels- in a torn was started in 1910 and pushed vigoiously until suspended in May 1912 because of moic urgent war needs, after having sj>cnt some .^75,00(t.()0(). No excavation, however, was starte- portunity for the re-examination of this project in the light of navigational needs as demonstrated by more than 25 years of operations. Marine Operational Problems The first step in such a study is the determination of the operational problems of the j>resent canal that must t>e overcome in any major plan for its improvement- Painstaking studies and repeated observation have shown them to be — 1. Dangerous bottleneck at Pedro Miguel. 2. Double handling of vessels at the Pacific locks. 3. Effect of fog in Culebra Cut on canai capacity and operations. 4. Lockage surges in Culebra Cut caused by the operation of the Pedro Miguel locks (3-toot maxi- mum amplitude). 5. Limited operating range of Gatun Lake water level (87 feet to 82 feet). 6. Navigational hazards in Cidebra Cut. 7. Narrow width of the present locks (110 feet). Sea-Level Plan Not Best Operational Solution The next step is consideiation of the alluring his- torical dream of a sea-levcl lanal. It is self-evident that the wide channels of the existing high-level Gatun Lake afford safer and more convenient navigation than can any necessarily restricted canal at sea level. 1 he advantages of uniestricteil navigation in the lake outweigh the minoi hazards and time lost by passage through the hxks. In view of the above, any feasible canal of so- called sea-level design, whiih. by the w.iy. would stilt re(|uire one set of tidal locks at the Pacific end, woukl be less satisfactory o|M:raiionally than the canal it would replace, to say nothing of its 447 Sen-Level Plan showing approximate toune in Telciiinuin -•> present canal Terminal Lake Plan Supplies Best Operational Solution, 1942-43 The solution of these problems is obvioui and simple, merely requiring the basic improvement of the existing Canal. This consists of (1) the physical removal of the Pedro Miguel locks; (2) the concentration of all Pacific locks in contin- uous lifts near Miraflores; (3) the elevation of the intermediate-level MiraHores Lake to the Catun Lake level for use as a traffic reservoir and anchor- age; and (4) the elevation of the entire summit- water level a few feet to its optimum height This solution will correct the present opera- tional dissymmetry in the canal, reduce marine accidents, decrease the time of transit, improve navigation and operations, increase capacirt. simplify its management and reduce operatins; costs. In addition, it will supply the best opera- tional canal practicable of economical achie\e^ ment and at only a fraction of the cost of any so- called sea-level undertaking. Old Canal Issues Revived by Atomic Bomb, 194S The advent of the atomic bomb in 1945 produced a tremendous impact on public and miliiarv thinking of the United States. Eventually, it led Canal authorities to look ujxjn the question of defending the Canal as requiring a reevaluaiion of the entire inter-oceanic canals problem. Tbex accordingly secured the enactment of Public Lav 280, Seventy-ninth Congress, ap|)roved December 28, 1945. authorizing the Governor of ihe Pananis Canal to make a comprehensive inve>iigatioa o: the means of increasing the capacity and securin of that waterway to meet the future neeil> of inter- oceanic commerce and national defense. This statute also provided for a restudy of the third locks project, a study of canals at other locations, xzti for the consideration of any new means for cransporting ships across land. Together, these provisions authorized the most extensive investi- larion in Isthmian history ever directed by one canal administrative official. The wording of this act is significant. Repre- iencative Willis W. Bradley, a retired naval officer, oo the House Committee on Merchant Marine and Fisheries, ivhich considered the report of the investigation under Public Law 280, later pointed out that this law was originally drafted in the Canal Zone by those who subsequently supervised its e.xecution. He also emphasized that in its exe- cution this law was given a far more extreme inter- pretation than was intended by the Congress fciiich enacted iL Thus, in an amazingly short period of time, was Liunched the second major canal crisis of the r»-entieth century which, though authorized by let of Congress, was essentially a resurrection of the corjjses of the 1902 "battle of the routes" and the 1906 "battle of the levels," with a rehashing ot' all the main arguments of the earlier struggles oc the basis of the newer military term, "security," rather than the older term, "vulnerability." In addition, the old nineteenth century ideas of a >hjp tunnel and a ship railway reappeared: the ihip tunnel to be atomic bombproof; and the ship railroad moilernized to provide Diesel-electric [■xomotives instead of steam. The extraordinary public interest in these L>»ues was shown by the large number of articles publi>hed in newspapers, magazines, and the Con- rressional Rcconl. These voluminously presented every conceivable angle of the subject, except the diplomatic anil o]>erational. Their primary theme 220 / DKCKMHKR, 1964 448 was a most persistent emphasis on new-weapon dangers, centering on the atomic bomb, as "dic- tating" construction of a canal of so-called sea- level design at Panama. In the ensuing public hysteria the long-range and fundamental mission of the Panama Canal to provide efficient and economic transit of vessels between the oceans was generally overlooked. Sea-Level Project at Panama Recommended by the Governor, 1947 As was easily anticipated from the nature of the publicity during the investigation, the Governor of the Panama Canal, in his report, recommended the construction of the sea-level project at Panama based upon the security hy|x>thebis. Though obviously calculated for its appeal, this thesis will not bear close analysis. The canal con- templated imder it would not be a wide passage comparable to the Strait of Magellan but actually a restricted tidal-lock canal, with the IcKks near the Pacific end. Though such canal would not have a summit lake, it would still have on each side of the main channel many miles of massive earth dikes, diversion channels, spillways, and flood-control reservoirs. In addition to its arguments for the sea-level project, the report significantly contains other provisions adopting the basic principles of the Terminal Lake plan for the fundamental im- provement of the existing waterway as an alterna- tive, which it did not recommend. As a preferred substitute for the Terminal Lake plan, however, the report did recommend the individual correction of certain operational de- fects of the present canal. These are mere sympto- matic treatments; they do not remove the basic cause of these problems, which is the IcKation of the Pedro Afiguel Locks across the south end of Culebra Cut where it forms a bottleneck. Nor does this report consider the all-important question of a new canal treaty with Panama which the sea-level project would definitely re- quire. It does, however, summarize in a more con- venient form available information on all the other canal route areas from Tehuantepec to the Atrato River. The most notable contributions of the investi- gation from the navigational standpoint were the studies of the jjerformance of model ships in restricted channels conducted at the David Taylor Model Basin, Carderock, Md., by the Navy at the Miles P. Uu Val, Captain USN (Ret), a gniduatc of the United Stiilcs Naval Academy, has had extensive sea experience and shore duly in the Navy Depart- ment and with tlic Canal Zone Government. A recognized au- thority and historian on Panama Canal problems, he has served as head of Navy Department studies for the moderniza- tion of the Canal 1946-'19, under orders of Secretary ForrestaJ. In addition to numerous papers on the Canal, he has written a series of books including: Cadiz to Cathay (1940 and 1947); And the Mountains Will Move (1947); and another on the Canal in prepara- tion. request of and in conjimction with canal authori- ties. These, it can be stated, produced a better understanding of the problems of handling vessels in restricted channels which have baffled engi- neers and navigators for more than a century. The participation of Panama Canal pilots and engineers in making these tests gave them a de- gree of practicality which otherwise could not have been attained by ordinary laboratory meth- ods. The results should be of increasing impor- tance in the design of restricted waterways in the future, notwithstanding the fact they could not cover all actual navigational situation which fre- quently arise. Congress Refutes Sea-Level Recommendations, 1947 The President, on December 1, 1947, forwarded the report to the Congress, and significantly, with- out comment or recommendation. Nevertheless, the report evoked sharp differences of opinion and, to date, the Congress has taken no action thereon. Canal Issues Clarified In Congress, 1947-51 Since submission of the recommendation for the sea-level project in 19-17, the basic issues of the canals problem, then generally obscure, have been admirably clarified in a series of enlightening articles in the Congressional Record, and other publications including technical jomnals, esjie- cially from the view|x)ints of the atomic bomb, national defense, and national economy. In a notable aililress on April 19, 1918, before the Cosmos CHub, of Washington, published in the Congressional Record of April 21, 1918, en- titled "What of the Panama Canal?" Rejjresenta- EXPI.ORKRS JOllRNAI. / 221 449 live Bradley vigorously elucidated the principal issues, both operational and national defense. His views concerning the atomic bomb are summa- rised: That, as far as he could ascertain, the great- est authorities on mcnlern weapons, who have studied the subject, have iniiformly held that any canal woidd be critically vulnerable to atomic attack; that a canal at sea level coidd be closed for prolonged periods by such attack beyond any hoiJe of speedy restoration, and cannot be con- sidered a secure canal; and that the atomic bomb is irrelevant as a controlling factor in planning navigational improvements for the Panama Ca- nal. Statements by other distinguished Members of Congress support Representative Bradley's con- clusions. Among the most telling are those by Representative Thomas E. Martin, of Iowa, a retired Army officer. His views concerning the defense angle, as published in the Congressional Record of July 18, 1951, are: "The time has come to stop deceiving the people with the idea that an impregnable canal can be constructed at Panama or elsewhere. So I now re|)eat what I have stated many times before, that the defense of any type of canal, wherever located, is an over-all govern- mental responsibility, and that its defense like that of the seaports, airports, railroads, highways, and productive centers of the United States de- pends upon the combined industrial, military, naval, and air power of this Nation, as obtained in both World Wars, and not upon passive de- fense measures, such as may be embodied in in- herent features of design." These two statements together reflect the cen- tral ideas of many leading independent authori- ties, including the eminent engineers who partici- pated in the actual construction of the canal, who have expressed their views concerning the rela- tion of the sea-level project to the broad question of national defense. The resolution of this question necessarily in- volves not only the form of future improvements of the Panama Canal and the question of a new canal at Panama of so-called sea-level design, but also canals at other locations, with significant economic and diplomatic implications, including the important question of transit tolls. Fortunately, a realistic basis for the planning of interoceanic canals has long since been recog- nized. As far back as 1905, the distinguished engi- neer, Brig. Gen. Henry L. Abbot, the great stu- tlcnt of the Charges, member of the Comitt^ Tech- nique of the branch Panama Canal Co., and of the International Board of Consulting Engineers, I'J05-6, and an advocate of the lake-lock tyjx?, saw the solution of the canal problem in its broadest sense. He stated: "The true criterion (for plan- ning) is ease and safety of transit, and • • • this test leaves no doubt as to which type of canal shotdd be preferred at Panama. • • •"' This standard, both simple and obvious, is as true today as it was when written in 1905. Moreover, it is applicable in evaluating not only canal pro- posals at Panama, but also at other locations. In this light, when considering undertakings, such as the 1939 third locks project and the Isth- mian Canal Studies of 1947, many have found it difficult to understand the philosophy and rea- soning behind some of the features and conclu- sions in those endeavors. But today, with the more obvious fallacies in the main arguments clarified, the canal problem in its national relationships is better understood and attention is focusing on the true objective of securing requisite capacity, operational adequacy, and efficiency. The American Isthmus has long been the scene of intensive explorations, the main purpose of which has been the construction of an inter- oceanic canal of the best tyjK; at the best site. Though often beset by bewildering confusions of ideas, the progress of fundamental concepts has been slow, at times deviating from their logical course. Yet events have always conspired to avert irretrievable error and the basic idea of the best canal project for marine needs has been preserved. The task is the redetermination of the isthmian canal policy of the United States. With that ac- complished, the realization of the ideal of Sim6n BoHvar will be nearer fulfillment. The eloquent words of the great Liberator, written in 1815 while in exile, will always inspire future explorers of the American Isthmus, and other students of the interoceanic canals problem in continuing their efforts. They are: "That magnificent portion [of America], situated between the two oceans, will, in time, become the emporium of the uni- verse. Its canals will shorten the distances of the world, and strengthen the commercial ties of Einope, Enierica and Asia." ■ I. Hinry I.. AI)Im)I, Problems of the Panuina Canal, New York: MacMillaii Co., 1905, p. 224. 222 / DECKMBER, 1964 450 RNCYCLOPAEDIA BRITANNICA 1970 PANAMA CANAL BY CAPTAIN MILES P. DU VAL, JR.. U. S. NAVY, REmiRBD PANAMA CANAL, a high-level artificial interoceanic water- -way of the lake and lock type at the Isthmus of Panama connecting the Atlantic and Pacihc oceans, owned, operated and controlled by the United States under treaty, for the transit of vessels of commerce and of war of all nations on terms of equality, with tolls that are just and equitable. The Canal Zone, through which it was built, is the constitutionally acquired territorial possession of Ihe United States granted in perpetuity by the Republic of Panama for the construction of the canal and for its perpetual maintenance, operation, sanitation and protection. The gross total investment of the United States in the canal enterprise, including defense expenditures, from 1904 to June 30, 1968, amounted to $6,368,009,000; and net to over $3,000,000,000. By using the canal, vessels plying between the Atlantic and Pacific coasts of the United States can eliminate the Cape Horn route and save a distance of about 8,000 nautical mi., while jour- neys between the Atlantic and Pacific coasts of the North and Sjuih American continents can be reduced by 3,000-4,000 mi.; vessels from Europe to eastern Asia and Australia can effect a saving of 1,000-2,000 mi. Hence the canal is of the greatest inter- naiional importance, strategically and economically. This article is divided into the following sections: I The Waterway 1. Description 2. Navigation II. The Canal Zone 1. Area and Tidewaters 2. Sovereignty 3. Administration 4 Tolls 5 Canal TratSc 6 Defense III History 1. Panama Railroad. 1849-55 2. French Project, 1879-1904 3 L'nittd Stales Policy, 18SO-81 4 Isthmian Canal Commission, 1899-1901 5 t S Diplomacy. 1901-03 6. Building the Canal, 1904-14 7. Principal Engineering and Construction Projects After 1914 8. Reorganization and Policy Determination 9. Panama-U.S. Relations I. THE WATERWAY 1. Deicrlptlon, — The Panama canal does not cross the isthmus from east to west as generally supposed, but from northwest to southeast, with the Atlantic entrance 33^ mi. N. and 27 mi. W. of the Pacific entrance. Located in one of the heavier rainfall areas of the world with its longest section formed by impounding the waters of the Chagres river valley by a dam at Gatun, the canal's principal features include: twin-Sight locks, dams and spillways at both ends of the canal ; the summit-level Gatun lake ; an excavated gorge across the continental divide, renamed aa Gaillard cut, connecting Gatun lake with the Pacific locks; a small Mirafiores lake between two sets of Pacific locks; and two terminals. The Atlantic terminus is at Crist6bal on Limne, under the supervision of the president, or such officer of the United ^Ules as may be designated by him (secretary of the army). It Ptrforms the function^ of city, county a.id state govenunents, *ith certain attributes of diplomatic character in coimection with the Republic of Panama. The governor, who is appointed by the president and confirmed by the senate, is ex-officio * director and president of the Panama Canal company. The judicial functions of the Canal Zone goverrunent are per- formed by two magistrate's courts, Balboa and Crist6b«l, each presided over by a magistrate appointed by the governor; and by a United States district court of the fifth judicial circuit, con- sisting of two divisions, Balboa and Crist6bal, presided over by one judge appointed by the president. 4. Tolla,— The levy of tolls is subject to provisions of the H»y- Pauncefote treaty (1901), the Hay-Bunau-Varilla treaty (190J), and the Thomson-Urrutia treaty proclaimed in 1922. Exempted from transit tolls in accordance with treaty are vessels owned, oper- ated or chartered by the government of the Republic of Panama and war vessels of the Republic of Colombia; also vesseli in transit solely for repairs at Panama canal shops. Tolls are assessed on the basis of Panama canal net toonaf* of actual earning capacity, a net vessel ton being 100 cu.ft. of space. Tolls cover all normal transit charges, including pilot service. Vessels operated by the United Sutes, including warship* and auxiliaries, are assnscd tolls. Tolls in 1958 were 90 cents per net ton for merchant veueli, army and navy transports, tankers, hospital and supply ship*, and yachts, when carrying passengers or cargo; 72 cents per net ton on such vessels in ballast without passengers or cargo; and SO cents pe» ton of displacement for other types. The average mea- surement per ocean-going commercial vessel in fiscal year 196S was ' 7,320 net tons and average tolls per vessel, $6^57. The Panama Caiul company is authorized to prescribe and, from lime to time, change rules for the measurement of vessels and tolls, subject to requirements for six months notice, public bear- ings and approval by the president of the United States, whoa* action shall be final and conclusive. 5. Canal Traffle. — Although the Panama canal was coacijvad and built primariJy as an artery of world trade, iu traffic except during World War II, has had an irreg\ilar but sustained growth since 1916 in the number of commercial transits and cargo tonnage. ruolytAr Total tnualu* TMalhnt m4_ 1»K J.H> J0,;S1.T55 ««.I1**M s,ou is,M«,«i; ii,ai 1,1*1 1»W T.M9 D.MJ.IM U,tM,«5* 1M3 4.i;> 11,050.105 ',«*.'»» l»«l 50,5M,«S1 1»5! «,«11 41.5JJ.1J1 55,ii>,sn IMO n.ui M.tOI.IM si,a(uMi I9»7 i<,o;o (2,1W,*I* IWS 15,511 lOSASS-JIS «J.i5J*«* *Eartiisive at timndtt (or Rpkln. Sown: Ammm^ Hifrnta ^ Urn* tl Dlmfn md friill«i(. fuaaa Coal Cimtfy. Its traffic volume is extremely sensitive to wars and deprtaiian*, and to appreciable political, economic or other upheavab in any part of tlie world, such as crop failures, atrikes, de*tructioa bjr trophal storms, development of foreign industries- and doture of the Sues canaL A significant feature of Panama canal traffic is the pattern of its trade routes, of which eight are well defined. The lowest traffic volume after 1933 occurred in 1941, when there were 4472 transits by ocean-going commercial veneli witk 11,030,105 tons of cargo. A high point in traffic history occumd in fiscal year 1968 when, because of the Vietnam war aad tht closing of the Sues canal, new records in the number of tranrita, toll revenue, and tons of cargo were made. Growing numbtw of commercial vessels with beams over 80 ft. were using the caaal, thus emphasising the need for increased capacity. & Dcfenie. — The Panama Canal act of 1912 vesurcapoaifaUity for protection of the Panama canal and Canal Zone in the luyanw, this protection being the normal exercise of poGce authority writhin the CanaJ Zone. Defense against exteinal aggiaaat en i* a function of the armed forces, for which the commander in cUaf, Southern Command, is responsible. These include army, navy and air force units, located in the Canal Zone and elsewhere. The act further provides that 'in time of war in which the United States sliall be engaged, or when, in the opinion of the p r eside n t, 453 2o8 PANAMA CANAL war is imminent." ihe president is authorized to vest exclu>i\c authority and jurisdiction over the Panama canal and Canal Zone goxTmmcnt in such officer of the army as the president may desig- nate. »ith the eovernor subject in all respects to the orders and directions of the designated officer of the army. During war or .emergency, elaborate security precautions are taken by both civil and military authorities, including careful examination of arriving vessels and use of specially trained security guards during transits. in. HISTORY The advantageous geographical location of the Central American isthmus was recognized by the early Spanish who. within a few years after the visit there by Columbus in 1502, followed with extended explorations focused on four main route areas: Tehuan- tcptc. Nicaragua, Panama and the Darien-Atrato. Not finding a strait, they promptly conceived the idea of constructing one. Because of lower continental divides at Panama and Nicaragua, with penetration by large valleys, these two avenues became rivals for isthmian transit. At Panama, mountainous terrain and tor- rential rivers, notably the Chagres, at the lime presented in- superable barriers to a canal. Lake Nicaragua. 3,089 sqmi. in area, with its then navigable San Juan river flowing into the Atlantic, reduced the magnitude of the task to cutting across the narrow strip which separated the lake from the Pacific. Even- tually, control of the Nicaragua route became a focal point of international conflict, with Great Britain and the United States in a diplomatic deatfiock. This situation was prolonged by the Clayton-Bulwer treaty (1850) which deprived the United Stales of exclusive control over any isthmian canal that it might con- strict. 1. ranam* Railroad, 1S49-5S When United States wesl- wsrd expansion in the late 1840s reqtiired better means for transit. three North Americans of vision, John Lloyd Stephens, Wil- liam Henry Aspinwall, and Henry Chauncey, organized the Panama Railroad company. Chartered in 1849 by the state of New York, this company, under enormous difficulties, completed building the Panama railroad in 1855 — the first transcontinental railrtMid of the Americas. Running from Aspinwall (CoI6n) close to the line of the future canal, this 47.5-mi. strategic rail link was the first concrete step toward construction of the Panama canal, giving it a tremendous advantage over Nicaragua in the choice of route. In view of the key functions that this celebrated railroad was later to fill in Panama canal history, it is important to note a treaty of 1846 between the United States and New Granada (Colombia). This treaty was an offensive and defensive alliance aimed primarily toward securing a canal at Panama, even then recognized by Pres. James K. Polk as the most practicable route. It provided that the United States should guarantee the "perfect neutrality" of the isthmus and its free and iminterrupted transit. 2. rrench Project, 1879-1904. — Meanwhile. French interests under the dynamic leadership of Ferdinand de Lesseps (qv.). hero of the Suez canal, decided to construct a canal across the American isthmus. An International Congress for Consideration of an Inter- oceanic Canal, consisting of 135 delegates, convened at Paris on May 15, 1879. to decide upon site and type. As president of the congress. De Lesseps applied his prestige and genius toward secur- ing approval for a sea-level type of canal at Panama. Adolphe Godin De I>pinay de Brusly, an engineer who had studied the American isthinus, protested strongly at this trend. He understood the topography at Nicaragua and how its large natural lake, 105.5 feet high, would contribute toward construction of a canal at that location. He krww the surface features at Panama — the continental divide about 10 mi. from the Pacific, the torrential Chagres river flowing into the Atlantic, and the smaller Rio Grande into the Pacific, both through valleys suitable for the formation of lakes. He emphasized the key problems at Panama as the con- trol of the Chagres river and excavation of Culebra cut, recognized the lake idea as offering the best solution, and proposed a "practical" plan for building the Panama canal It called for a dam at Galun and another at Miraflores. or as close to the seas as the configuration of the land permitted, letting the waters rise to fon two lakes about 80 ft. high, joining the lakes by cutting across Ik continental divide, and connecting them with the oceans by lock} This design, he explained, was not only best for engineering bv also most advantageous for navigation. Unfortunately for the French, De L^pinay's idea was ignoid His conception, however, and its dramatic presentation before tk Paris congress of 1879, established him as an architectural ml engineering genius and the originator of the plan from which Ih Panama canal was eventually built. The French Panama Caul company, despite De Lepinay's timely warning, launched upoo lb ill-fated undertaking. Ten years later, in 1889, its effort coUapitc due to a combination of bankruptcy, lack of planning and diseut In France, it resulted in a sensational financial scandal Vet, t». fore failing, the company, to save money and time, was forcn! to change its plans from sea-level to a high-level lock type. Reorganized in 1894 as the New Panama Caiul company, in officers realized that their only chance of assuring any retuni a the investment was to hold on until the United States could bt induced to take control. Thus until 1904 they limited their activ- ilies to technical studies and such excavation as were required ti protect the concession from Colombia. The total French exca\i- tion was 78,146,960 cu.yd. of material, of which 29,908,000 wtn later useful to the United Slates. 3. United Statca Policy, 1850-81 With active canal a- deavours temporarily checked by the Clayton-Bulwer treaty ul transit facilities met by the Panama railroad. United States eflom were generally restricted to explorations. It was not until G« Ulysses S. Grant became president in 1869 that major intern revived, with extensive naval exploring expeditions starting i 1870 and covering the more important canal sites. With the objective of securing the best type of canal at the ba site, and at least expense, the reports of these expeditions mt reviewed by the first United States Interoceanjc Canal conunissioiL 1872-76, consisting of Brig. Gen. Andrew A Humphries, cldrl of U.S. army engineers: C. P. Patterson. U.S. Coast survey; vi Commodore Daniel Ammen. chief of the bureau of navigation af the navy. Reporting to President Grant on Feb. 7, 1876, Ibi commission was unanimous in recommending a Nicaragua cuil starting on the Atlantic side near Greytown, following the Sa Juan river to Lake Nicaragua, through the lake, and thence actus the land to Brito. Thus, the United States became definitely co* milted to the Nicaragua route, then complicated by British ctwid of its eastern terminus through their protectorate over the M» quito kingdom. tix'C was supported by former President Grant, who, in Feb. 1S8I publicly commended "an American canal, on American soQ, » the American people." 4. Isthmian Canal Commlaaion, 1899-1901. — The Fiod failure in 1889 rendered the canal situation less acute, requiriofi new crisis to dramatize the issue. This was supplied by the h» toric voyage of the U.S.S. 'X)regon" during the Spanish-Amerioi War in 1898. which emphasized the need for an isthmian caal The result was that Pres. William McKinley, in 1899, appointed* Isthmian Canal commission, with Rear Admiral John G. Walks U.S.N, (ret), as president, to investigate all canal routes, paitie* larly Nicaragua and Panama, and to recommend the most pnt- ticable. In its first report on Nov. 16. 1901, the commissioned mated the cost of a Nicaragua canal at $189,846,062, and Pam* at $144,233,358; and the value of the French holdings at $40.(XIO 000. But as the French company was demanding $IO9.141.50(l(« 454 PANAMA CANAL 209 i""i« ly. Ihe iDial estimate for Panama was S25.'.374.S58. ■ the cxcev> cost for a canal at Tanama, it recommended \it.ir.iL'ua as the only practicalile route. 5. U.S. Diplomacy, 1901-03 — Meanwhile. Ihe United States eovernment. under the leadership of Secretary of Stale John Hay. n,s"iiaifd "'•'' '■'"' Britain Ihe Hay-Pauncefote treaty of S,iv l.<. IWI which superseded the Clayton-Bulwer treaty and recoenized the exclusive right of the L'nited States to construct, rfKubte and manage any Isthmian canal. It further adopted the princiial points in the Convention of Constantinople (1888) for the Suez canal as rules for the operation and neutralization of the .\merican canal. These rules provided that the canal should be free ind open to vessels of commerce and of war of all nations on terms of entire equality, with tolls that were just and equitable. The I niied Slates was also authorized to protect the canal against law- |f,sne« and disorder. The New Panama Canal company in Paris, reacting to the com- misviun's recommendation for Nicaragua, on Jan. 9, 1002, cabled .Ailmir.il Walker its readiness to accept the United Slates offer 01 540 000 000 for its holdings. Thereupon Ihe commission, in a suppicmcntary report on Jan. 18, 1902, canceled its first recom- mendation and recommended Panama as the most practicable and (Msilile route for an Isthmian canal. Describing the previous con- rf^^inns from Colombia as unsatisfactory and insufficient, the commi^->ion emphasized the necessity for obtaining in perpetuity the grant of a sufficient strip of territory across the isthmus for canal purposes. Promptly transmitted to Ihe congress by Pres. Theodore Roosevelt. Ihe new recommendation started a memorable debate in the congress known as the "battle of Ihe routes." Out of it came the basic law for construction of the Panama canal approved June 28. 1902. known as the Spooncr act. This laiv authorized the president to acquire all French holdings including its Panama railroad stock at a cost not exceeding $40,- 000000. to obtain from Colombia perpetual control of a strip of land for the maintenance, operation and protection of the Panama canal and railroad, and then, through the Isthmian canal com- mission, to construct the Panama canal. The type contemplated by ■he act was high-level, with Atlantic locks and dams at Bohio to iorm a Lake Bohio. Provision was also made that in event of failure to obtain an adequate treaty within a reasonable time, the president should proceed with construction of a Nicaragua canal. In harmony with the act, Tomas Herran, Colombian charg^ d'affaires in Washington, after many months of arduous labour, succeeded in negotiating a most favourable treaty for his country —Ihe Hay-Herran treaty of Jan. 22, 1903, which was ratified by the United Slates senate on March 17, 1903. Unfortunately, this treaty became involved politically in Bogota. The Colombian senate, called into special session on June 20, 1903, for its ratification, rejected the treaty against urgent plead- ings by Herrin in Washington and U.S. Minister Arthur M. Beaupri in Bogoti. Tke ft] A few days later, on March 8, 1904, Preiident Roosevelt rec- ognized Ihe contributions of Admiral Walker by appointing him aa the first chairman of the first Isthmian Canal commission (or the construction of the Panama canal. One member, Maj. (jcn. George W, Davis, U.S. army (ret.), was the first governor of the Canal Zone. John F. Wallace, a leading railroad engineer, not experi- enced in "frontier" work, was chosen as the first chief engineer. The Canal Zone was formally acquired on May 4, 1904 — ■ day subsequently celebrated annually in the zone ai Acquisition day. 6. Building the Canal, 1904-14^Work under the United Slates started haltingly. Because of public clamour to "make the dirt fly, ' the commission weakened in Its stand for tborotiffa and comprehensive preparation and started work without proper equip- ment or plans. Though valuable time was thus lost, the commission made important contributions. It organised the Canal Zone |0v- emment. started sanitation under the supervision of William Crew- ford Gorgas (f.v.), and recruited the nucleus of to ai(iiieerinf and construction force. Resigning on March 30. 190S. the Walker commission was suc- ceeded by a new one headed by Theodore P. Shonts. a prominent railroad executive, with Wallace continuing as chief engineer. Though for a time conditions improved, Wallace, on June 26. 190S. suddenly resigned, throwing the working forces into confusion. Battle of Ihe Levels, 1904-06.— Of the difficulties of this period the gravest was increasing uncertainty as to the type of canal that should be built — the high-level lock type contemplated by Ihe Spooner act or a canal at sea level as had been suggested by Wal- lace in 1904. Fortunately. President Roosevelt selected a great railroad builder, executive and explorer. John F. Stevens, as the new chief engineer. Stevens' qualifications were unique. He bad read everything available on the Panama canal since the time of Philip II, discovered Marias pass in Montana, built railroads in the Rocky mountains and supervised open mining operations in Minnesota. Thus, he had observed what occurs when the delicate balances of nature are upset, understood the hazards of cutting a ship channel through mountains, and was experienced in personnel and con- struction problems in undeveloped terrain. Arriving on the isthmus on July 25, 190S, at a time of chaos, be rescued the project from possible disaster. He promptly provided housing for employees, established commissaries, adopted sanita- tion measures, ordered equipment and double-tracked Ihe Panama railroad. After planning the transportation system for Culebn cut excavation and for relocation of the railroad to higher ground on Ihe east side of the canal, moving the Atlantic locks site from Bohio to Gatun to form Gatun lake, recruiting competent leaders and farming the organization for building the Panama canal, he found progress hampered because of delay on the decision as to type of canal, then being considered by an International Board of Con- sulting Engineers, of which General Daris was chairman. In its report of Jan. 10. 1906. this board split — the majority of eight members headed by General Davis and including five Euro- peans, voting for sea level; and the minority, five Americam Iheisi <'>ed vattetKTSSKBSfSr^bmHaaiicA It was recog- nufd. first by the United SUtes, second by France, and soon after- »ard by other countries. Then followed negotiation of the second basic carul convention, the Hay-Bunau-Varilla treaty of Nov, 18, 1903. with Panama in- stead of Colombia. By this treaty, in harmony with the Spooner act. United States was granted in perpetuity exclusive use. occupa- tion and control of the Canal Zone. Significantly the United States could exercise all sovereign powers to the entire exclusion of the exercise of such powers by Panama. That country was to receive JIOOOOOOO in cash and a $250,000 annuity to begin nine years «'l«r ratification of the agreement. The proclamation of this I'caiy on Feb. 26. 1904. sealed the choice of the Panama route. I leuTii noa rar arutimc *»• 455 2IO PANAMA CANAL (Alfred Noble, Henry L. Abbot, Frederic P. Steams, Joseph Ripley ind UYam Randolph), voting (or the lock type. The controlling features of the lock plan recommended by the minority were a dam at Gatun creating Gatun lake 8S ft. high as the summit level and Culebra cut. Parallel flight locks were to be provided: three-lifts at Gatun, one-lift at Pedro Miguel, and two-lifts at Sosa hill, the last two sets being separated by an inter- mediate Sosa lake. Though of difierent lock arrangement, this pUn was the stihe type as recommended in 1901 by the Walker commission. Testifying before congressional committees in Washington in January and June 1906, and using the De l^pinay arguments of 1879, Stevens supported the high-level plan with a conviction that no one could shake, and strongly opposed the sea-level plan recom- mended by the majority of the International Board of Consulting Engineers. In the end. with the support of President Roosevelt, Secretary of War Taft, and the Isthmian Canal commission, the views of Stevens prevailed against strenuous opposition concerned primarily with questions of "vulnerability." Congress, by act ap- proved June 29, 1906, adopted the high-level lake and lock plan as proposed by the minority. This was the great decision in building the Panama canal. The transit since 1914, in both peace and war, of thousands of vessels of various types, completely establishes the wisdom of that decision. It secured for Stevens, who was mainly responsible for bringing it about, great fame as the basic architect of the Panama canal. This fact was recognized in Oct 1962 at the time of the opening of the Thatcher Ferry bridge by the dedication of a handsome memorial honoring the great engineer. Paci/ic Lock Location Question, ;P0tf-0i.— Though the high- level plan, as approved by the minority of the International Board of Consulting Engineers, placed all Atlantic locks at Gatun it divided the Pacific locks into two sets. Stevens, early in 1906 be- fore adoption by congress of the minority report, recognized the Pacific lock arrangement as faulty and recommended consolida- tion as a needed change. Eventually, on Aug 3. 1906. Stevens ap- proved a plan placing all Pacific locks in three-lifts south of Mira- floics with the terminal dam and locks between two hills, Cerro Afuadulce on the west side of the sea level section of the canal tnd Cerro de Puente on the east side, a location later recognized ky Lieut. Col. George W. Goethals as offering the best site. This anaogement would have enabled lake-level navigation from the Athntic locks to the Pacific, with a summit level anchorage at the Ptdfic end of the canal. Refrettably, Stevens was under great pressure to start active oVBftniction. Advocates of the sea-level proposal, stung by their defeat in congress, and also opponents of any canal at all, were iwdy to take advantage of any change in the approved program as evidence of weakness in the high-le.'l plan. Together, these two forces represented a political and eco.i^niic power that could not be ignored. Stevens' foundation investigations, necessarily made in haste proved unsatisfactory, and he did not dare to jeopardize the projtti by further delay. On Aug. 23, 1906, apparently confident that thji important question would rise again, he voided his plan but n- tained it on file, and proceeded with the approved plan for sepi rating the Pacific locks, which he did not personally favour. Later, after Stevens left canal service, Maj. William L. Siben a member of the commission with a keen appreciation of mariot needs in the design of navigational works, made more extensi\t explorations. Finding adequate foundations, he likewise, on Ju 31, 1908. recommended the consolidation of all Pacific locks ii three-lifts at Miraflores to provide a Pacific terminal lake, but b well-reasoned proposal was not approved, and the canal was coo- pleted with two sets of Pacific locks, separated by Miraflores laic Conslruclion and Completion, 1907-14. — With canal type i- cided, construction organization effected, and a greater part of tk plant installed by July, 1906, real progress started. Thus, Stevos was able to assure the press in 1906 that the canal would be con pleted in 1914 and formally opened by Jan. 1, 1915. On Jan. 30, 1907, after having brought design and construclioe to a point where work was in "full swing" and success a certaint} Stevens submitted his resignation to the president. Despite thu action, however, Roosevelt, on Mar. 4, 1907, in recognitioD oi his tremendous contributions, appointed him as chairman of \k Isthmian Canal commission, making Stevens the first to hold tk combined positions of chairman and chief engineer. Stevens was succeeded by Lieutenant Colonel Goethals, ao out- standing army engineer, who, with his associates, civilian as weOii military, ably brought the project to completion substantially i accord with the Stevens plan. Such changes as were made, thot^ important, were nonbasic. These included widening the bottcoif Culebra cut from 200 ft to 300 ft., increasing usable lock din* sions to a width of 110 ft. and length of 1,000 ft., with a deplkli permit passage of ships drawing 40 ft. in salt water, reroutioglh Panama railroad around Gold hill, relocation of locks from Sm hill to Miraflores, and redesign of Gatun dam. Other members of the Isthmian Canal commission on Apri I 1907, were Maj. David D. Gaillard, Major Sibert, naval civile!^ neer Harry H. Rousseau, Lieut. Col. William C. Gorgas, Jactaa Smith and J. C. S. Blackburn. Later changes included LieuL Cd H. F. Hodges (1908-14) to succeed Smith, Maurice H. ThatBr- [ m il I ri ipli'li'iii Bu ll III! III! Ifn i h il ri liilii 1 P i l i . n \ M )»»8)M»ift> 4> i ipuiH i in i i| i ^flft >i c» i ltol Ifce loolc canal, r/heirbas tho foreign engineers are a unit ogainSt it, , . I think this is partly to be explained by the fact that the groKt tjruffic canal of the Old '^^orld is the Sue i Canal, a sea-level canfcl, Iftoroas the groat traffic oanal of 'ttie Few V'orld is the^Sault Ste. H-rio Canal, a lofck canal. Although the latter, the Soo, is eloped . ■ ^ iUA.vigation during the winter months. It carries aAnii&lly three' ' Htues ■yfio traffic of the Suez Canal. In my judgfient tho very able tirgwent of tho tiajority of tho board of Consulting Engineers is vi,- '^ ■ tl&ted by their failure to pay proper heed to the l9SSons tau^t by ' tl^ifa oonstructlon and operation of the Soo Canal. It must bo borne i''- '^ ill mind, as the Cotrilsslon points out, that there Is no question of ■ •. buljding what has been picturesquely termed "the Straits of Panama;^ that is, a waterway through which the largest vessels could go .witii ''Safety at uninterrupted high speed. Boidi the sea-level canal and ;' f:,'tho proposed lock can^'-l would be too narrow and shallow to be called , ' V with any truthfulness t. strait, ^x to have any of the properties of y « 'wMe* deep Vrater strip. Both of then ivould be canals, pure and ■,: 'v, #J,i>plo. flach typo has certain dlsac! vantages and certain advantages, /, I jlifit. In tiiy Judgment, the disadvantages are fewer ahrt the advantages ,,: ;>. /Vtif^' much lyeat^r in the case of a look canal substantially as pro- >;,<'' ;;!/''pe>*,M in th« papers forv^arde^ hprevdthj and I call especial attention '> \Liso'-^,^^ tiy>o% that the cMef engineer, v/ho will be rainly responsible -.'hX ^s,",-Jtt>i*,*f)e «uceports seems to establish l fltrojif, pi'f^'bs.-,' ^,1'Mliti' *hct the follrjftrinf; £ife the facts i The sea-level ecml would ir}^ '^iial than the sea-level canal. Iloreovor,* vrhtat has been actually *X''3erioJl6tratod in nakin;; and operating the great lock canul, the Soo, a nore important artery of traffic than the great sea-level canal, the Sue^, goes to support the opinion of the nin^rity of tho Consult- f1'^^^ f'oard of ijfigineors and of the ntvjority of the Isthiiian Canal Con- \''MSsion as to the superior safety, feasibility, emd desirability of ii'^ildinG a lf>ok canal at Pancria. fff :. The X&w now on our statute books seens to contenplutc a lock '; -#b,lnal. In riy Judgnent a lock canal, as heroin reconnonded, is advis- ^. able. If the C ngress directs that a sea-level canal be constructed ite dlroctirin will, of course, be carried out. Othervdso the canal *rj.ll bo built on substantially the plt.n for a look canal outlined in ;. jy^ Sicoonpanying papers, sych changes beinp nade, of ooursc, as nay .' be t" ound actually necessary, including possibly the change reconnendod by the Secretary of V^ar as to tho site of the dan on tho Pacific side. THEODORE EOOSEn^LT. „ fJIL miTB HOUSE, February 19, 1906. If 461 [From U.S. Naval Institute Proceedings, April 1956] AN ENGINEER'S EVALUATION OF ISTHMIAN CANAL POLICY By E. S. RANDOLPH WITHIN less than fifty years after com- pletion of the Panama Canal, the United States is faced with the fact that as magnificent a construction job as it is, the canal cannot much longer fill the needs it was built for. It is being outdated both as regards the size and number of ships that need to transit. Recognition of this fact is evidenced not only in the constant study by Congressional committees but in numerous articles appearing in magazines and news- papers. The high-level-lake and lock canal with modifications as proposed by numerous au- thorities can be readily constructed by alter- ing the present canal without interrupting traffic* All needed improvements can be built into the structures and waterways as the work progresses. The plan is entirely practical as an engineering project and is the first comprehensive plan for the marine oper- ational improvement of the shipway. It is a plan for which precedents exist concerning the engineering and construction, estimates of cost and of time required to build, and cost of maintenance and operation year after year. The canal enterprise includes all services of management and government for the popu- lation as well as for transit and other accom- modations for the vessels in passage. These administrative problems can be very en- grossing, as can the problems of correlating the interests of the diplomatic service and armed forces with the canal interests. En- gineering considerations of long-range plan- ning are therefore likely to receive secondary priority. The policy during the construction of the canal was to retain a chief engineer, a mem- ber of the Commission, for the duration of the project. After completion, the policy has been to replace the controlling engineer about each fourth year. For the control of • See "Isthmian Canal Policy — An Evaluation," by Captain Miles P. DuVal, USN (Ret.), in the March, 1955 PSOCEEOINGS. landslides there was no substitute for the exf>erience gained before and after admission of water to the cut. For the control of floods pouring into Gatun Lake there was long range experience to be gained. Now, as the canal approaches the limit of its commercial capacity, there is a wealth of knowledge gained by long observation of the behavior of geologic formations and engineering mate- rials, and the efficiency of different shap>es and types of navigation structures, which knowledge is possessed by those who have devoted years of time to observation and study of the many special problems. Looking back, it would seem that the better policy would have been to establish a career p>osition of Chief Engineer in the operating organiza- tion and to have filled it with a jjerson having long and continuous resptonsible engineering experience in the canal service on the Isth- mus of Panama and whose vision, projec- tions, and accomplishments all stemmed from intimate knowledge of, and association with, the Panama Canal. As long as such a policy is not adopted, errors made in the past must inevitably be repteated. This writer, after 35 years employment on engineering works on the canal, during and after its construction, and additional years in the United States, concludes that it is neither necessary nor desirable that the head of the civil government of the Panama Canal be a professional engineer, but it is necessary that he be a capable executive. The engineer- ing considerations relating to the mainte- nance and improvement of the utility are so broad, numerous, and highly sp)ecialized that the responsible engineer can do them A BZOISTEKZD professional engineer in Baton Rouge, Loaisiana, Mr. Randolph was employed for some 35 years in the Canal Zone. He was in direct charge for the Government of the con- struction of Madden Dam and later headed the organization making the investigations for the Third Locks Project. 395 462 U. S. Naval Instiluie Proceedings [April Official U. S. Navy Photograph WILL SHE Fn? A TIGHT SQUEEZE FOR AN IOWA-CLASS BATTLESHIP As a matter of fact, these battleships were designed to fit, with the limitation of their maximum beam being the minimum lock-width in the Panama Canal. justice only if he functions expertly and freely in his assigned duties, unhampered by responsibility for administration of the canal and by detailed directions, however well intended. It is apparent that unceasing consideration should be given to future programs for maintaining the canal in adequate condition. Major modifications should be planned years ahead of need, and plans should be periodically modified to meet changing con- ditions. The first consideration is: When will expanded facilities be required? Because this question cannot be exactly settled it should be reviewed at yearly intervals. If not done, it is probable that the too late start made in 1 940 will be repeated. The start of the Third Locks Project, in 1940, followed an investigation made with- out adequate funds to perform the immense investigation essential before successfully undertaking such a construction program. After war threatened there was insufficient time to complete the investigation. The 1947 report of Isthmian Canal Stud- ies contains much valuable technical infor- mation, but the recommendations no longer meet the tremendous changes in the art of warfare, nor do they now present a true pic- ture of present-day costs. There is no govern- ment agency which can properly undertake a comprehensive plan of major action for the modernization of the ship canal across the American Isthmus. The "high-level" canal plan is character- ized by its maximum utilization of the pres- ent waterway, with retention of the best features proven by over forty years of oper- ation during both f>eace and war and with a correction of those features which have been found to be defective. The work of construc- tion would involve problems that were solved during the construction and mainte- nance of the original canal. The convenience 463 1956] An Engineer's Evaluation of Isthmian Canal Policy 397 Navy Photograph THE illSSOVRl AND NEW JERSEY CROSS PATHS IN THE CANAL ZONE On April 21, 1951, these ships met at Balboa. The Missouri was returning from, the New Jersey en route to, shelling Communist positions in Korea. and certainty of operation would be a fore- gone conclusion. The maintenance problems would be known with certainty. The most economical use of existing structures and waterways would be made. The present firmly consolidated earthen dams and dikes would be retained as they are or strength- ened if found necessary. The Gatun Lake receives the waters from the tributary rivers and diverts them to useful purposes. This "high-level" canal can be planned with every assurance of success and can be con- structed for less cost and in less time than can any other design so far considered. The sim- plicity and relatively moderate propyortions involved in the "high-level" plan may render it less glamorous and so op>erate against its adoption. The judges of the merits of the "high-level" plan may find it has less popu- lar support than its excellent and serviceable qualities warrant. The "sea-level" plan contains engineering and constructional features which are grossly without precedent in the Isthmian area. There would be masses of excavation and embankment work involving a wide variety of soils and rocks, earthen structures of great size and weight, and deeper cuts than previ- ously made. The oversize dredging equij)- ment required for deepening the cut before lowering the water level would necessitate a program of development involving unfore- seeable risks, delays, and costs. Without ex- perience, there is no solid basis for the evaluation of the action of the materials under the new order of pressures which would be developed. Because tidal currents would prevail if locks at the Pacific entrance of the "sea- level" canal were not used, the waterway would necessarily be deeper, wider, and straighter than required for the "high-level" waterway. Heavy maintenance problems (perhaps insufwrable) would develop be- 464 398 U. S. Naval Institute Proceedings [April cause of the higher banks through a longer distance. The bottom of the projjosed new channel would be about 108 feet lower than the bottom of the present cut, at Contrac- tor's Hill, thereby cutting into an heretofore undisturbed geologic formation known to be unstable. The success or failure of such a waterway- would be a matter for demonstration after completion rather than before it is com- menced as in case of "high-level" plan. The time and the cost to build the "sea-level" construction, not to mention the cost of maintenance after completion, are unknown quantities, but all would be vastly greater than required for the "high-level" plan. The complexity of the "sea-level" plan and opportunities for experimentation are of a nature to intrigue members of the engineer- ing profession. The massiveness of the physical work contemplated might well at- tract manufacturers and construction con- tractors to the project. The judges of the merits of this plan must ever be on guard against an enthusiasm which is not justified by its over-all qualities inherent in the plan itself, or by any result to be attained there- from. Contrasting the "high-level" and "sea- level" plans, the former would not require any initial lowering of the undisturbed bot- tom of the eight-mile cut to obtain increased depth for navigation. The latter contem- plates tremendous excavation of a new chan- nel through the central mass that would be more than 100 feet deejier than the present cut and many miles longer. The problem of landslides would be greatly accentuated. The experience gained from maintaining the pres- ent slopes would probably not apply to the proposed new slopes at much greater depth because the qualities and arrangement of geological formations encountered would be different, as would be the internal stresses. The present cut is bordered by great valleys where once landslides were in motion. Having walked in the bottom of the deep cut and having explored and studied the moving earth slides, this writer, who perhaps has a more resjiectful attitute toward them than have those who merely read of their histories, advises against stirring up numer- ous new and greater landslides unless justifi- (fation is so overwhelming that the experi- ence of the years can be deliberately rejected. In the "sea-level" plan, the great diversion dams are propwsed to be constructed by dumping excavated spoil from barges through the waters of Gatun Lake. Later the lake would be drained during an interval when it must be closed to traflRc. There is no previous exp)erience to guide the engineer to a safe conclusion of this work. The problems of subsidence, heaving, and lateral flow of the swamp muck under the lake will be present, but its action may be delayed until the lake water is lowered and the dikes become open.- tive. The builders of the Panama Railroad, about 100 years ago, projected a line and built a fill through the Chagres River Valley and upon the swamp muck. Any engineer who has to deal with that muck should make a thorough study of the difficulties encoun- tered then, also again when the present rail- road causeway was built on the drained swamp bottom to a height of 92 feet above, sea-level. During the construction of the causeway the weight of the new fills caused, at places, a subsidence under the fill accompanied by an upheaval at the sides of the fill. This action was overcome by laying counterweight fills where heaving was observed or anticipated. The work was in plain sight above water, which would not be the case when depositing fill through water. Engineers who have en- countered this swamp muck have invariably experienced difficulty.' Having been employed by the Panama Railroad Company when the causeway car- rying the relocated railroad line was being constructed, this writer doubts the advis- ability of carrying out the "sea-level" diver- sion plans without much additional assur- ance of their reliability. The optimum water level in Gatun Lake is that maximum desirable level for re- quired increase in navigable depth through the eight-mile length of the central mass and for other purf>oses. Increase in depth can be better attained by raising the water level than by cutting below the undisturbed bot- > R. C. Sheldon, Trans.-Amer. Soc. Cml Enpneert, Vol. 114, 1949, pp. 847-9. 465 1956] An Engineer's Evaluation of Isthmian Canal Policy 399 torn, thereby causing additional stresses in the high banks of the cut and precipitating new slides. Associated is the appreciable in- crease in minimum depth which would result from the dampening of surge waves if the Pedro Miguel Locks were removed. The opti- mum level can be determined only after a major engineering investigation. As long as such increase is possible, no new structures should be erected along the high-level water- front without ample freeboard. Widening and straightening of navigi^tion channels could proceed before, during, and after the building of new "high-level" locks, by dredging at an economical rate, only when required for the accommodation of larger vessels, and by use of an augmented maintenance fleet of standard dredging equipment. The minimum dimensions, as determined by navigational considerations, need be anticipated only a few years in ad- vance. Within the eight-mile length of deep cut, considerations of slide-control dictate that proportions be determined by more rigorous analysis than in all other reaches. It is doubtful if any security would be gained by rejecting a high-level-lock canal in favor of a low-level-lock canal. I submit that the insecurely poised banks of any economically feasible "sea-level" cut through the Isthmus of Panama would be susceptible to atomic bombing so as to close the canal to traffic for an indefinite period, possibly years. There appears to be a relation between the depth of cut and security against refilling from the sliding of banks. The interoceanic canal problem, includes, besides engineering and geology, grave ques- tions of diplomatic relationships, economics, and marine oi)erations. However great may be the pride of authorship of any proposal, the issues must be decided on their merits at the highest plane of wise and experienced judgment and statesmanship. This I firmly believe can be best accomplished by an in- dependent and broadly-constituted Inter- oceanic Canals Commission as provided in the Martin-Thompson bills now pending. 466 Diablo Heights, c. Z. March 26, 1943. ;iei.:orrindu:n for the Governor: Throur;h Enrinoer of Maintenance, TAIIAMA CAlJAL-rRO POSED inrROVEraWT OP OPErjtTI .."'> CONDI TJ.0;j3 AND INC^EASIin CAPACITY Reference is nade to two reports to the I'arine Superintendent by Comnander DuVal, Port Captain, Balboa, dated February 25 and March 25, 1943. 1. Anticipating, a request to report on thir. natter, becau.oe of a number of discussions of it v.l th the author during the prepara- tion of the reports, this paper has been prepared for use in the dcvclopnent of the studies needed for an evaluation of the plan. 2. Comnandor DuVal has presented the first coraprehensive plan for fundamental improvement of the Canal based on actual marine operatinc experience. His position as Fort Captain at Ealboa and his studies of the Canal and its operation have enabled the presentation of authentic and fundamental conclusions that are available as a basis for planning future improvements. 'Vith such a plan, so simple, broad, and forcefully expressed it is at last possible to attain the best canal for the future. With this fundamental concept of the upper level terminal anchorace at the Pacific Terminal to serve as an "expansion chamber" and establish- ed principle, it is possible to plan future improvements with assurance of success that will reflect great distinction upon those who diall contribute to the v.-ork. 3. My first intimation ttiat Commander DuVal had such a plan under consideration, or that the ari'angei.ient of the Third Locks was not satisfactory from a mnrine viewpoint cane during an in- spection trip in Balboa Harbor, on January 7, 1043. During; several discussions which followed it was noticed that all operatinc features of the Canal fitted naturally into the plan; then the contour of the proposed summit level lake at Miraflores was drawn upon a topographic map, and it was found t".^.at the hills impounded- the watoi- except at lock sites ar.O small saddles. Vjry small saddle fills v/ould be reqi ired to bring the minim-jm ground lino 467 1.0 Eli^vntion 100, 4. I concur in all 6f the favorable conncnts in Cornmandcr DuVal'c; roportr. , lit; hac covered the maidno consideration:;. All engincerinr; considerations v/hich are ancociatcd with the plan are f favorable to it. The management of the Canal would appear to be simplified by the concentration of facilities now between Pedro Miguel and I.ilraf lores , into the area south of Miraf lores Lake. Any one should feel privileged v.'ere he given an opportunity to contribute tov;-rd the clearing away of difficulties which may ptcnd in the way of this plan. 5. Since Commander DuVal has conceived this modification of the Third Locks Frogram, his advice vi'ould be most valuable during its investigation, and later for advising during the assembling of it into a coordinated whole. There are few engineering problem.s of the Canal, Locks, and other water front structures which are not associated with the passage of vessels. The technical studies needed for the full analysis of the problems which would arise in connection vd th this plan are numerous and involved, but there are persons still on the Canal capable of handlin^i tliem, 6. Report . Ass'jming that the new locks will be built at Miraf lores and tlie locks at Pedro Miguel will be abandoned, it v/ill be necessary to report in justification of the changes. For the development of renewed interest in the Third Locks Project such a superior plan will be a povi^erful instrument. To avoid a second interruption, due to political or other forces, it is im- perative that the plan be on a sound basis that can stand attack from any angle . 7. Justification. Ample justification can be shov.'n for the revision of the general plans submitted to the Secretary of War nn February 24, 1939; Four vitally important years have contribut- ed to the knowledge of the Canal and its place in world affairs f.-f the future; the construction of the third flight of locks was precipitated by a national emergency, now a modification of the construction program. has permitted more study of the plans; com- pletion of the geologic explorations, v»hich v/ere in their initial stages when the former report was mado (see Appendix A), has shown that the proposed Pedro Miguel Locks and appror. ch channels pass through ground having the characteristics of the Cucaracha Slide material; cost estimates are already upsot and must be re- vised as the result of the modification of the construction program; there arc also the precedents of changes in the Canal plans during its construction, e.g., Gatun Dam, increasing width of cut, re- locating LaBoca Locks; besides there should be a great simplifi- cation in defense of the Canal with two less points to defend, the situation would be somewhat like that at Gatun. B. Opportunity to Investigate. Due to tho modification of the Third Locks cons ti-uction program there is apparently ample time for the full investigation of the controllia^ features of the proposed plan, and follo>.;ing that the more important of tiie secondary considerations, -iith the pacsa.:o of time nc'.v light is 32-461 O - 78 - 30 468 thrown on problen.s and nore persons contribute to tiiem; therefore, the future needs mv'ar dated February 24, 1939, tlic Governor of the Panama canal estimated that the tonnage capacity of the Canal was 50,000,000 a year, and that traffic estimates mace in 1936 indicated that a "boom cycle" might bring that much tonnage by the year 1961. (2) A program, dated March 15, 1930, was made for fui't'ner traffic studies and was approved by the Engineer of Maintenance, but priority of other matters prevented its completion. If such a study is made, it ^iliould be in collabora- tion with someone familiar with marine problems of the C^inal. (l)U.o, Ax-ny Interoceanic Canal Board, H.D. 139, 72d Con. , Dec ,1931. (2)r.ri. 210, 7Gth Cong., March 16, 1039, p. 4. - 4 - 470 14. 7r: f.flc dui-lwr, ;^T;if lc-;t-lnn. It is cf co\ir£c acsui-'.cd that tl-ioro v,iil bu no iut..ri'i;ptij!i to traffic thrcu^jh the Cr^nal dui'inf^ thtj construction pro(jra)7i. Po,dro Miguel Locks can be retained in service until .ill -.vork nt Illrrif lores Ic in a suitable condition for elevating the Ivliraf lores Lake to sunr.it level, v.'hich can bo done in a sliort time; Then ships can glide through the locks v;ith the aid of tov.ini" locomotives. A temporary trestle will be needed to elevate the south approach and v/ing v;alls above v.-ator level wliile sliips pass through the locks with v/atur at high level to the south. A channel can be dredged to the v/est of the locks, the v.'est and center v/a.lls can be ronoved, and the channel v.'ill be clear. 15. At Miraf lores the old locks cannot be modified until the ncv.' locks are prepared to handle the traffic. It v/ould be possible to modify one chamber at a time under plans "34(a)" or "55(b)", but without another new lock available such a plan appears to be unsafe. For locking ships during the time when -the lake is being elevated there must be facilities available for usea.t any stage of the lake level. Another possible plan v/ould be to leave an old lock suitable for the lower water level Elevation ± 54 and construct another suitable for the higher. In the former case a new lock could be constructed with the summit level entrance at the approximate level of its upper chamber floors, and at some convenient time after the water had been raised to full height, the sills, if desired could be elevated by installing an entrance caisson. In the latter case, the old locks v.'ould accomnodate traffic until the start of raising the lafee, traffic would be halted and the old locks would be dammed off by some means, the lake v/ould be raised, and when navigable depth v;as availr.ble above the nevv' lock sills, traffic would be resumed. 16. Foundations . For locks added to the Third Locks at Mira- flores there Is a considerable amount of geologic data available for the prelimina.^y location and estimates. For additions at the site of the old Miraf lores Locks some explorations (core-holes) will be required if a sound estimate is required. For the in- vestigation of the extension to tlie spillway a few core-holes should be bored. For the investigation of t}ie I.riraflorcs West D-'-m one or more test pits should be dug. For the dikes required to elevate the low points of the impounding ridges for the new lake level, a surface survey r.nd auger borings v/ould be needed. The above list may be expanded in case poor material is encountered and a change in plan is indicated. 17. The Nov; Fedro Miguel Locks as nov; proposed v/ill be on the poorest foundations of all locks. Besides there are high sloping hills of doubtful stability opposite the approach v/alls at both ends. To avoid placing locks there would be a relief from some construction difficulties; if not from later earth movement effect- ing the stability of structure. It may, at first, seein rcgrottablo to abandon the designs and field investigations for both the Now Tedro Miguel and Mir;if lores Locks, but the additional planning v.-ill involve only a change in plan for the triple lock at Jlira- flores because of its sii.iilarity to Gatun Lock; then there v/ill bo tile n.jw plans for the locks v/hlch replace the old Mirr.florcs - 5 - 471 Locke, .■■.nd '.^v-in -t/.oy iwu-j be nu';h liku the oW Oatun Locke, except foi- cort;.".ip. ir.provemontc in tlien. If the field Investigations h; ve Eho\/n th-it neither the found'/.tions nor the slopes of the br.nlcs rre ".r. r:t-.blc for tho locks proposed ".t Pedro Miguel vs they r.rc for f.io other locks, they v;lll hrvc served a valu'^blc purpose. I do not contend that it is ii.npossiblc to build the New p.,dro Miguel Lockn .'.nd approach channels in tho location r.ov/ shav n, but the difficulties in the way of strengthening the walls and in sloping tho banks, which are of an unstable material, will bo great. I believe that these difficulties constitute a second argument for seeking a better location no'.v that there is an opportunity. IG. Miraflorcs L.akc . It is obvious that the inclusion of tho Miraf lores Lake will a dd materially to the storage area of Gatun Lake. Tho drainage area of 37.4 square miles is net usir.lly needed for filling the Gatun Lake, but there is an advantage in having the drainage fall into the sunanit level, because the storm water, or" a portion of it, can normally be diverted through the cut to Gatun Spillv/ay instead of discharging it into the Canal channel below Miraf lores Locks where its effect on navigation is objectionable. In floods of major proportions it may be necessary to use the Mirf..f lores Spillway, but that would bo at long Intervals of time. The area cf Mlraflores Lake at Elevation 54 is about 1.5 sq. miles, at Elevation 85, it -r'Hl be about 3.6 sq/ miles. It will add about 2 percent zo the retention volume of Gatun Lake. One lock chamber drawn from the lake will lower the average lake surface less than one inch. 19. Optimum siL-nnit level of Canal . This is a fundamental consid- eration as sti'uctural and hydraulic problems depend on it. If all Pacific and one Atlajitic lock are rebuilt there is less difficulty foreseen in the elevation of other structures. Although it may not bo justifiable new to raise all structures, it might be shown that new structures should be'raised to some level which will permit a higher lake level to be obtained at some future time, when- there is an urgent need for deeper water and more stora^ge. Without raising tho lake level, a largo amount of added storage will be realized duo to the elimination of surges, and possibly some due to lessening the height of water at Pedro I'iguej Locks which piles up when the Chagrcs River is in flood. Unless it is drawn down, the entire cut takes the same level as tho river Gamboa which is higher than at Gatun. This addition may be suf- ficient for all time but there is a doubt. The range of the lake is fixed on tiao lov;er side by tho necessity of maintaining navigable depth; on the upper side by heights of the impounding structures. In water supply studies, the lower Unit suitable for navigation was set at Elevation 80. But I feci cure that this is not suitable for oven the present vessels of the larger sizes and more unwieldl^ types except with unusual care and facilities for transit. Con- s'iderin.^j the form and size of the v/atemvay and the anticipated .size and type of the future largo ship, we probably should adopt some other minimum depth of watcrw.ay. 472 20. Viai'^r sLora.','G volume in Gatun Lake is required for flood control and for a ^vatcr supply riurinn tho dry season. The; storage volume lies in the space between the lo'/rast level permissible for suit- able nnvitjation conditions and the hi.^hest level whicli will not cause damage. Flood control volume is required because v/ater from storms is added to the lake faster than is practicable to spill it out, hence it accumulates during heavy inflows and is discharged for some time follo'^inr a storm. The space in the reservoir above minimum level and below that required for flood control is filled at the latter part of -ne rainy soason; for gradual use thrcuRhout the dry season, for lockages, hydro-electric power, evaporation, municipal, and Carious by the'^r^:^-!: of'; '''' li""' ''''^'' °" '^'^^ =^°-^^ i^ -^i-^ted as high'as is':onsiste""4S\r'"' ''1^' °' "^''^^^ ^"^ "^^^ ^'^- extending over long periods of tti^'^ emergency. Curing operations . ri ^ . periods of time there will be more probability that V/hen such a fSod conSol VSr-' :' '' "''' •"'^" ^' ^=^ permissible, investigation f e^ ^Part of th "? '/^ T'^'' '^ "^'^ '^^ ''^^^ ^- be endangered by grea^ Till/ Tr, f m ""'^ auxiliaxy uorks which can July 9, 19kl by^Ef sr^rlt;, onli Zr' /Vir'^f''' '"^^"^-' consideration has been tr-;,.^// ^^ngr.; To augment water storage into the lake, d^epeSng he wa^t'er^^f^' f •^'^""- ^^^^^'^ -^ -^ef the railroad across Gatun Val^ ^'"'n^'a st" V""""'' ' ^''^ ^^""^ station. Early in the Third Locks st.d,!^'''^'^^ generating sideration should be given to rai-mrth n' "' ""' suggested that con- «o';aSf'""= -- -"«- -pSL'?- „7-- - -«£~tea 21. Adequate depth for navigation and vfater storage for all future years can be obtained by raising the lower and upper limits of Gatun Lake levels. To determine the optimum levels a number of con- siderations must be balanced. Possibly the ultimate determination cannot be made from a financial analysis alone, but such factors may be a considerable aid to final judgment. The problems as I now see them inc],ude: (a). Determine the intrinsic value of a higher lake level with regard to navigation considerations, in comparison vdth a deeper channel of the present general characteristics. In connection with lockage^ur'^es^' Pl^" ^his should be based on the elimination of (b). Determine the cost and ir.con^/ience of deepening the cut elevati"; ^l' '""^'^T' '^"^ '''"P°=' '^'^ =°'"P^^^ ^^ -^^ ^^e cost of elevating strictures, etc., a like aTiount. li>„ !"''; ^^^-""i"'^ tlie cost and inconvenience of providinc a like amount of water or power by other means. l-roviamg a (d). Detemine the actual gain in the operating range of -7- 473 r.atun J.-ko a.-i the rri.uli of olininat-ion of lockage iurpoc . At ].ov/ v,.-itoi- r.L;u,:c;; tho trough of the wave decro^scG the depth possibly OHM foot. At )iiGh v/nter stacRCj t.he crest of tlie wrive increases the heirht of the water possibly one foot. The maximum possible surpe is sbout three feet from crest to tro'J{3h. Besides lockage surgi;3, Compandor Duval's plnn vrill permit, to seme extent, a reduction in head at ledro I>Iiguel or Miraflores, -which i? no-.; the result of rises at Gamboa. This vdll cause a current in the cut, as the spillway must be used to reduce the head; hence it may not be a navigation advantage. (e). Determine the future n'^'^essary operating depth con- sidering ship and channel characteristics. (f). Determine the optimum retention volume for flood control, lockages, po\7cr, evaporation, leakage, municipal uses, etc. (g). Determine the changes v/hich would result if the summit level ■.vere raised. Assuming that Commander DuVal's plan is adopted, some of them would be: (1). Elevation of superstructure and adjuncts of Gatun locks (old). (2). Same for Gatun Spillvray. (3). Elevation of Gatun Dam, The dam is 30 years old and has consolidated itself and foiindations. Some additions would benefit it — make it more resistant to attack — vdthout considering higher v.-ater levels. (li). The Railroad grade betv/een miles 11 to 1? and 1? to 30 is below Elevation 100. The old fills should be well consolidated no\T and should readily stand the small additional vveight of several more feet of fill at tops. In case of the maximum probable flood, it is possible that the track -..'ould be overtopped, and an investigation might show that the grade needs raisin:- now. (5). The bridges at Monte lirio and Gamboa do not have much clearance now, and might be damaged or swept out by the greatest probable flood. If the lake vfere raised they could be given all needed clearance above flood level. (6). The saddles along Gatun Lake, Atlantic side, would need examination, The Cano and the saddle near Agua Clara would need fills. (See Chief of Surveys Memo, dated 6-16-39. Canal Record, VII, 133-h). (7). Considerations v.'o'ild be required of water levels at Gamboa town, (8). All vvatorfront installations along the lake v/ould -8- 474 need invot;tiKation. (9). Gatun llydro/eloctric Station would have a hieher head. It -.vould have to be comudcred. There would lopoar to bo more output from the same machines, but at seme extra cost. 22. SpUlv/avs. The syillway capacity at Gatun should be r.uch ,.rcat^.r u nder prese nt and Third Locks plans. Recourse has been had to spillinc throuc'h lock culverts. The use of the Pedro Miguel eict emer- gency dm for omercency spillins has been arranged. The adoption of a plan having a summit level lake at I.Iiraflores opens up ne;v pos;;ibilities for securing proper spillway facilities. The simplest means would be to elevate the old gates to the nev; lovely then construct a stilling basin beloiv the dam. Consideration should be giv?n to other schemes; one night be the provision of sluiceways tfirough the dam, so that the machinery would be protected from bombing. If spilling is done from Miraflores summit level lake in excess of the inflow to the lake from the drainage area, currents will set through the cut. During lockages, currents will already be passing gently through the cut. There is a nailne problem inoicated, to determine what current is permissible in the cut. 23. During veiy large storms there will be currents from the flow of the chagress River at Gamboa v.'hich will prevent navigation. Under these conditions it is expected that vessels will tie up in Gatun lake or anchor in Ivliraflores Lake; then the spillway in the summit level Mira- flores Lake can operate at greater capacity. All eight gates in opera- tion vrould cause a current of about four to five knots in the cut. If it operates at full capacity it may cause scour in the cut and shoaling in the lake; also there will be some sot% of disturbances betv;cen liLra— flores aijd the sea. There is still sufficient talent on the Zone to make the theoretical studies relating to currents and water resources. 2U. Surges. It is claimed that surges v.-ill be eliminated in the cut by the proposed summit level lake et Miraflores. I cor.cede this because the water drawn for a lockage vdll lower the general level of the lake less than one inch. In the T!"iird Locks plan surges will be reduced somewhat. Studies have been made of surges in the cut to determine the amplitude and period, but this is only one of the d^nonstrations. Final determinations of ths effects of surges cannot be made in a laboratory, although valuable contributions are made there; navigators, >aih all obtainable test data added to their practical o.-.Terience, can arrive at t.ie final conclusion. Surges in tha cut are due primarily to drafts of lockage water and can reach amplitudes of about three feet from crest to trav'Sn^ / 'T. '"■' ' '■^"'^"*' ^^'^^ *° ^^"-^ bow wave of a ship s^;^s:;eirfoS:ge:rsr:?h:;-fS-.^-,-^-""b"-°^-^ -ijucts Will probably become unimportant. -9- 475 2P>. ■ i'.\xru,c v.-a/es fwu bcllovod to bo r-.ornc lalurt v/l th pulcntlnn cui'runt!', 'ind t}i',;C(; .".ddcd to tliu curi'cntn cnuccd by locknces bocomo d;in;j;urnur. to nav.if;ation. Each lock'icc di-ift now cp.uscs a puln-itin^ current, but v,i tJi tho buffer Ic-.kc nt i'lraflores tho velocities will bo f-lov.'od down r.nd will rippi-onch unlfoiT. flow. The difficulties of navli;;itin,- a restricted channel ai'C r.rdo greater by any current; .".round bonds the curi-entr, assume a transverse direction; this with tho sur-iTo wave ?-nd wind may have been the cause of n'lny ships strik- ing th:.. bankr- of the Canal. The problem of roriulatinf, flow velocities cf.n be more easily handled in a hijjh level than in a sea level canal. -I tm not sure they can be handled in a sea level canal at Tanrima. 26. Depth of w.-.ter for navigat i on. There has been no rational dotcrainat.lon of the depth of watei- required for tiie safe nf.vigatio: of ships throuf^h the Gaillard Cut. If depth is a controlling facto: In safe navigation wo knov; that it is not now sufficient for come of the ships that regularly transit; there are an excessive number of groundings. navigation through the cut is expected to be much simpler should a summit level lake at Miraf lores be created, it will have some influence in reducing the future necessity for deepening or v.ldening the cut. '.."hat the depth should be is deeply involved with the width and curvature of the channel, the draft and maneuverability of the ship, wind, surges aiid currents. Laboratories and mathematicir,nE can furnish much contributory data but the ultimate determination of the ciiannel depth can only be made with the aid of practical navigators. Until the depth is determined there is no way to determine the amount of draw-down permissible in the dry season. 27. Shape of bonds. The best shape and dim.ensions for bends . in the cut have not been determined from a navigation viewpoint. Since the Canal has been completed there have been a number of improvements made at the worst points by cutting some material from, the inside bank. There has been a vast amount of experience with these bends and an approach to the problem can be made. The practical application of this plan to Commander DuVal's plan will be to indicate that these operations on bends can bo reduced when tho surges and currents have come under better control. 28. ■ Other associated studies . The report would be incomplete if it did not discuss all plans which have been discussed previously or any which now r.ppear to bear on the final decision. The idea, very popular among the laymen, of a sea-level canal should bo dis- cussed. Some contributions to this are contained in a ro])ort dated Uny 1, 1941, compiled by E. S. Randolph, Consulting Engineer. Another study, which was prepared as a step tov/ard conversion to sea level, was made of a plan for lowering the summit level of the Can.-'l to Elevation 55; by E. S. Randolph, Cocigning Engineer, dated February 17, 1933. 29. Conclusions : (a). The comprehensive plan prcse.ited by Commander DuVal appears to merit a full investigation. The initial cost should - 10 - 476 bo invcuiijuntod :iiuJ ,'ilr.o .'in attempt choiild be u.'- de to ev.'iluntc the niunei'OiiL; advantifjes he polntr; out. Thi; Intrinsic value of Eono of then may be difficult of evaluation in money, but tbioy should not b« loi;t sif^ht of in the final analysis. Even if the e;:tim'itcd initi-il cost of the ne\/ plan, in comparis.iii \.'iti''. the Third Locks plan, is con:; idcrably f;r'-''ter, It is believed that the many advantages, the operating econoriy, the more rapid tr^insits, the increase in operating capacity, and the lesreninf^ of hazards v/ill bo sufficiently great to warrant its adoption. (b). The new structures, if located at J.ilraf lores, v/ill be on firmer foundations than if located at Pedro Miguel, and all other enr;inccrin;_; considerations appear to be favorable to this plan. (c). After the general features of the plan have been well investigated, it is believed that justification for the change in program will be ample. (d). Due to the r.odifi cation of the Third Locke program, there appears to be ample time, before resujning construction, to m;dce the necessarj studies which would bo faciltatcd due to the rich acc-jnulation of data already in the Canal files. There are sufl'icient persons remaining on the Zone who are familiar v.'ith those problems to conduct the studies, -■^O. Recommendations: 1 (a). That studies be undertaken to determine the feasi- bility of the plan, and that they have high priority. (b). That as soon as the plan is shovn to be feasible, all construction activities not in conformity with it be dis- co!itinued. (c). V.hen studies have advanced to a point v;hcro definite genei-al plans and reliable estimates can be made, arrange for the necessary congressional raithority for the nev; plan. /s/ E. 3. RAIIDOLFH Cons^vEn^ Enclosures: i^i;. Fig. 1. 7 Fig. 2. :>! V Q , Aa&lfc t ■ c^tA ^-Ucl — the BiMJiL^^j LI r Ifi T>t initi>n cm c o . 11 477 A ppcruMy- A . Brief backcroimrt of the studlcL. lc,'.dlnG_ to the^ current Third Locks plr.nt;., (a). . '2hc. -first report made by the Governor of the ranrxi'i C'LM'il to tlio. Sccroti.ry of V/ar on the cubjcct of addltion-J. loclcr wnz mr^de b^' Governor K. L. Walker, on Auj.u£:t IV, 1927, In thic he st-.ted that by the year 1940 there v;as t.nticlprted a comv.ercial traffic of 50,400,000 tons P. year, which v;ould require a locka£;c capacity of 28 ships a day throu^^hout the year; but due to Dc;\k days the arrival of ships for transit r,;ir,ht bo a.- r.-.u'oh :.s -10 a day. Ho concluded tto t by the year ] :;40 the construction of additional locks should bo authorized and be re.ady for use by 1950. (b)., A period of inactivity followed. On April 9, 1934, a pro(Trara for studies v;as made up, but r.ction was ' not taken then. On Au£;u:;t 51, 1956, a new prograin was prepared for the investi- gation and design of additional facilities and the work which followed proceeded along the generr.l plan of action laid out in that program. On May 1, 1936, public resolution No. 85, 74th Congress v/as appixived. It authorized the investigations. On June 21, 1957, the Special Engineering Section was established for carrying out the invosti/jations. The name of the section was changed to Special Engineering Division on July 22, 1939. (c). During the consideration of the revision of toll rates, in 1936, a new analysis of the anticipated cargo to transit the Canal Vv'as made. This did not indicate any early need for more lockage capacity soon. With the belief in mind that increased capacity would not be required for many years, the progrjn of studies v,'a.'-. prosecuted slov;ly. (d). OnFebruary 24, 1939, a report v/as made to the Secretary of War which contained the present plan .for the Third Locks (H.D. 210, 76th Cong., March 16, 1939). This was based on locks 125 feet wide, 1200 feet long, and 45 feet deep, separated from the old locks, estimated cost J277 ,000,000. This project was authorized by Pub. No. 391, 76th Congress and approved on August 11, 1939. Additional funds were not made available until the end of fiscal year 1940. V.'hen the report shov.'lng the location of the Third Loc!co, dated February 24, 1939, was submitted, less than ^139, 000 had been expended on the investigations. (o). A United national emergency was proclaimed on September 8, 1939. And by the time the Construction had been financed, there was ;i gruat urgency for expediting the work. Prior to the 12- 478 start of co!iGti"action, other project:: of a cloforiE(3 nr.ture hrid tnkeri procedc;icc over the Thii'd Loclcf invc;t- tl R.-iti ons r'.nci designs. i>ome of Uic inver, tln:ationE could not be brought to a lojicn.l concluGion, Ijut cons tri;c tion could not be delayed for sucii work. (f), ooine months f-ollowin^ the entry of the United StritcL- into the \/;.r, the consti'uction progrtm v.'as riodiflcd. Proper jud,3ricnt was exercised v/hcn the Pedro Miruel excnvation wns ter.iporcirily nbnndoned. This has afforded en opportunity to revaluato the entire project and to introduce nodif ications esGontlp.l for the future ccinal. E. S. Randolph. Cons^ Encinoer ^//z March £G, 1943. 'V 15 479 Questions of Mr. Uornan and Answers by Captain DuVal Committee on Merchant Marine and Fisheries, Wushiiigtoii, D.C., June 2i), 197S. ('apt. Miles P. DuVal, Jr., Cannon House Office Building, WiisliiiKjton, B.C. Dear Capt. DuVal: In view of the fact that you did not '^et to testify at tlie hearings of tlie Sea-Level Canal Study on June 2S, I would appreciate it \ery much if you would answer the attached (luestions for the record. Thank you for your cooperation. Sincerely, Robert K. Dornan. Mcinhcr of Congress. (Jiiistion. What effect would the creation of the Terminal Lake have on the sununit level drainage area? Answer. The Gatun Lake drainage area is ahout 1320 square miles. Crea- tion of the Terminal Lake would augment the summit level drainage area l>y 37.4 square miles. Question. You have u.s'ed the term, "capacity", a numher of times. Will you explain what is meant hy it? Answer. There are two aspects to the question of capacity, one, the num- ber of vessels that can he transited, and the other, that of the size of the vessels that can be accommodated. Recent estimates are that the existing canal will be able to make 27.000 transits annually of sizes within the limits of pre.sent locks (1000' x 110'). This does not provide for larger vessels of which there are increasing num- bers. Question. In using the term, "operational improvement", what do you mean by it? Answer. In the sense used, it I'efers primarily to improvements in the navi- gation and movement of vessels in the Canal. Such improvements would in- clude the elimination of the bottleneck locks at Pedro Miguel, the consolida- tion of all Pacific locks at Aguadulce to ci'eate a summit level Terminal Lake to provide an expansion chamber for vessels to correspond with the layout at Gatun. and a number of channel improvements as shown Ity ex- perience to be needed. Question. What is meant by the "optimum summit level" of the canal and what is it? Answer. As described by former experienced Panama Canal engineers, the optimum summit level is the highest feasible level, which the 1947 Report under P.L. 280. 79tli Congress, established as being 92 feet, which is 5 feet above the present highest water level of S7 feet. Such increase would double the present 5 foot operating range of Gatun Lake (S2' to 87'). The determina- tion of this level is fundamental because the height of structures depend upon it. Qu(stin)i. Much money has been expended at various times on the Panama Canal. Will that money he wasted by adoption of the Terminal Lake-Third Locks solution? Answer. On the contrary, experienced Panama Canal engineers have ex- pressed the view that this solution will enable the maximum utilization of all work so far accomplished on the Panama Canal since its opening to traffic in 1914. Que.'itio)!. What useful work was accomplished under the 1939 Third Locks Project before construction was stoi)ped in 1942? Answer. Tlie useful work on the 1939 Third Locks Project includes : 1. Two huge lock site excavations at Gatun and Miraflores. 2. A rail-vehicular bridge across the ^liraflores Locks. 3. A roadbed for the relocation of the Panama Railroad at Gatun. Question. What were the major operational defects of the 1939 Third Locks Project? Answer. At the Atlantic end of the Canal the location for the proposed new locks was sound because it diiplicated a sound layout that enables flex- ible operation of the Gatun locks because of adecpiate anchorages in Limon Bay and Gatun Lake. 480 At the Pacific end it would have duplicated a lock location that experience has shown to have been wrong operationally. Thus, the 1939 project would have aggravated present operational problems instead of solving them. World War II experience revealed these problems and enabled the develop- ment of their solution. Question. You made a very strong point about the necessity for the elimi- nation of the bottleneck locks at Pedro Miguel in any major plan for Panama Canal modernization. Will you elaborate? Answer. In spite of extensive stuuies on the operational defects of the present Pedro Miguel locks, the 1939 Third Locks Project lias been carried forward in much canal literature without an adequate explanation that these locks are the focus of major canal marine operating problems. The solution of these problems is not the construction of new locks at Pedro Miguel alongside existing locks, as some have proposed, but the elimination of these locks. Question. What do experienced navigators think about the Terminal Lake- Third Locks Plan? Answer. Every ship that has transited the Panama Canal since 1914 has expei'ienced a loss of transit time of about one hour because of the Pedro Miguel Locks. Experienced ship captains have often a.S'ked why the separa- tion of the Pacific Locks, instead of their consolidation as at Gatun. On learning of the development of the Terminal Lake-Third Locks Plan, experienced navigators, naval as well as merchant marine, have strongly supported the proposal. Question. In regard to the term "symptomatic treatments". What is meant by that term? Answer. This term refers to proposals to solve operational problems in- dividually instead of removing their basic cause, which is the location of the Pedro Miguel Locks squarely across the south end of Gaillard Cut. Such proposals include moorings in the summit channel near Pedro Miguel, surge reservoirs to dampen lockage surges, and fog dis'persal equipment for Gaillard Cut. The remedy is not one of symptomatic treatments but the removal of the major cause — the Pedro Miguel Locks. Question.. About the problem of fog, what is the nature of this problem? Answer. Observations made from the top of Cerro Paraiso, some 550 feet liigh, on the west side of the Pedro Miguel Locks showed a total of 118 nights with fog in Gaillard Cut, 110 in the wet season and 8 in the dry season. These fogs may extend from these locks northward as far as Bohio. They virtually never appear north of Bohio or south of Pedro Miguel. In fact, one super- intendent of the Miraflores Locks stated that he had not seen a fog over Miraflores Lake in 25 years. Panama Canal fogs may last from one to eleven hours and at times are so thick that pilots cannot see the banks. Question. You refer to the Terminal Lake-Third Locks proposal as being a tes'ted plan. Will you give a fuller explanation as to where and how it has been tested? Answer. The canal layout on the Atlantic side enables xuiinterrupted flex- ible operation of the Atlantic Locks 24 hours a day because of the availability of commodious anchorages near both ends of the locks. The operational superiority of the Atlantic layout has been recognized by pilots and captains since 1014. The Terminal Lake — Third Locks Plan would be similar to that at Gatun. Thus, it is accurate to state that this plan has been tested since 1914. Question. What are the movements of water in Gaillard Cut that affect navigation? Answer. There are two: lockage surges in the form of tide-like waves of about 3' maximum amplitude and a current of about one knot, both caused by lockages. The leakage surges would be eliminated by removal of the Pedro Miguel Locks ; the current would not be eliminated. Question. In your testimony you referred to the sea-level canal proposal as a "hardy perennifil". What has l)een the basis of its advocacy? Answer. Historically, the advocacy of the so-called sea-level design pre- viously mentioned has been based on the alleged greater vulnerahiliti/ of the 481 lake-lock type and the aller/cd invulncrahiUty of a canal of sea-level desujn. In lyu.j-OU, it was the alleged dandier of naval (junfirc, whicli became an im- portant factor in regard to the faulty locations of the Pacific Locl^s. In 11)39, it was the alleged danger of cncnuj honihiny attacks that led to choosing the sites for the proposed new locks in the Third Locks Project a short distance away from tlie existing locks. In 1945 it was fear of the atomic honib and other luic u-capon dangers tliat led to the inquiry under Public Law 2^0, 79th Congress, and its recommenda- tion in 1947 of only a canal of sea-level design for alleged reasons of se- curity" and "national deiense". This recommendation served to exclude the plan that many independent canal experts at the time considered to offer the best solution when the problem was evaluated from all significant angles. The 1947 report failed to receive the approval of the President who sent it to the Congress without comment or recommendation and the Congress took no action thereon. In 1964, it was alleged danger of sahotayc of the existing canal, even by "two sticks of dynamite," that led to the inquiry luider Public Law 8S-G09 for the pre-determined objective of sea-level advocate.s. In 1970, it was the alleged danger of guerrilla warfare to the existing canal used in arguments for a canal of .sea-level design. In 1971, following an earthquake in Panama, it was the alleged danger to the existing canal as a further argument for a sea-level project but an inspection of vital canal structures by the Governor of the Canal Zone revealed that no damage was sustained. The only difference in the arguments, over the years for a canal of sea- level design has been a change in the bugbear of justification. With this single exception, whenever the canal question has come up for national attention, the discussions have followed the same pattern of site and type ; and that is the pattern today. Question. What are the true criteria for canal planning? Answer. Despite bewildering confusions the true criteria for planning are ease and safety of navigation. This test leaves no doubt as to what is best at Panama for the safe, convenient and economic transit of vessels. Question. What position have leading nuclear warfare experts taken as re- gards the vulnerability of an interoceanic canal? Answer. As far as it has been possible to learn, leading authorities on nu- clear warfare have uniformly held that any canal regardless of type is critically vulnerable to the atomic attack and that the A bomb is "irrelevant" with respect to the determination of type. Attention is invited to the bibli- ography on his matter earlier in my pre.sentation. Question. What effect would creaticm of the Terminal Lake at the Pacific end of the canal have on lockage surges? Answer. This matter was studied in the Canal Zone during the develop- ment of the Terminal Lake-Third Locks Plan. It was found that lockage surges in Gaillard Cut would be reduced from their maximum of three feet to less than one inch, which is navigationally neglible. [Whereupon, at 5:30 p.m., the subcommittee adjourned.] t I UNIVERSITY OF FLORIDA 3 1262 08128 288