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Panama Canal Upgrades Locomotive Fleet

Date: 13-APR-2005

Six Units to Arrive in May for Assembly in Panama; Two Completed On-Site in Late 2004

PANAMA CITY , Panama , April 19, 2005 - The Panama Canal Authority (ACP) announced today that it will receive the components of six new locomotive units from Mitsubishi this May for on-site assembly, testing and deployment. Part of the last option of a multi-year contract that was exercised in September 2003, the six new locomotive units are among 16 of 34 units purchased from Mitsubishi Corporation with the unique provision that they are assembled on-site in Panama by ACP personnel.

The first two locomotives were assembled in Panama under the close supervision of the contractor´s engineers, between August and October 2004. Another 14 will be assembled solely by ACP engineers and technicians. The assembly provides ACP employees with a transfer of skills and opportunities for training and education.

Nicknamed "mules," these units move on tow tracks along the Canal's locks and are affixed to vessels by wire cables to maintain their position during transit through the locks. The new units have 50 percent more towing power and faster return speed than previous models, reducing each vessel's lockage time.

Another two shipments of 10 each are scheduled to join the fleet. The first 10 will arrive next September 2005, while the last 10 fully-assembled units will arrive in July 2006. The final shipment of eight units to be assembled in Panama is scheduled to arrive in January 2006.

All locomotives must undergo a thorough and rigorous series of inspections. To be accepted by the ACP, each unit must pass a one-month full operations test. This is part of the ACP's commitment to quality control, ensuring that all equipment and machinery are at 100 percent before use.

"In every line of our business we strive to be more effective, as well as more efficient. Our unique arrangement with Mitsubishi is just one example of this - whenever we can, we want to bring to our employees experiences that create on-site institutional skills and memory," said ACP Maritime Operations Director Jorge Quijano.

The ACP continues to move forward with projects under its permanent modernization program such as: the replacement of the locomotive tow tracks; the implementation and further upgrading of the Automatic Identification System (AIS), a sophisticated navigation system to better monitor ships and route traffic for safety and security purposes; the addition of a new launch; the Automated Data Collection System; and the deepening of the Gatun Lake and the Atlantic and Pacific channels. These projects increase capacity and ensure the waterway's safety, reliability and efficiency.

About the Panama Canal Authority
The Panama Canal Authority is the autonomous agency of the Government of Panama in charge of managing, operating and maintaining the Panama Canal. The operation of the Panama Canal Authority is based on its organic law and the regulations approved by its Board of Directors. For more information, please refer to the Panama Canal Authority's Web site: www.pancanal.com.

The Authority's responsibility to the Panamanian people is paramount. The Canal belongs to the people and benefits from the Canal should accrue to as many Panamanians as possible. The Authority will plan its future so that it will continually contribute to the economic development and welfare of the citizens of Panama.


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