Panama Railroad

News of the Panama Rail Road :

Passenger Service delayed to End-May/Beg.-June

Passenger Service to start in April 2001

Kansas City Southern looks south of the border

Panama Canal Railroad Co. to complete the $30+ Million Interoceanic Railway in the year 2000

A US Company is Planning to Rebuild a Train Line along the Panama Canal

Concession for Panama Railway approved in Parliament.

Message by the President of the Republic of Panama (in Spanish)

Carlos Espino appointed as New Director of   the Panama Railroad (in Spanish)

Panama Railroad Director Victor D'Anello resigns(in Spanish)

Branch Line News International

Remarks as Prepared for Delivery Ambassador William J. Hughes Luncheon in Honor of Ambassador Eduardo Morgan U.S.-Panama Business Council Washington, D.C.

Passenger Service delayed to End May/Beg.June

Dear Customer,

As you may already know, two weeks ago we received a shipment including most of the equipment for our Executive Express Train. This shipment included five F-40 locomotives and four of our passenger cars. They can be seen parked near the old Cristobal Freight House in Colon.

We are currently carrying out final tests on the locomotives and a team from the U.S. is here putting the final touches on our luxurious passenger cars.

On May 1st, we carried out a test run from Colon to Gamboa and back and we are pleased to report that everything is running well. The track runs smoothly and the train performed according to our expectations.

For those of you who may still remember the train ride, it is indeed a wonderful and exhilarating journey.

The work on our two passenger terminals is moving along as scheduled as is most of the activity surrounding our Executive Express Train service.

We have, however, run into a slight delay. The work at the Miraflores Tunnel is a bit harder and more complicated than anticipated. This has resulted in our now expecting the service to begin during end-May/beg-June. We appreciate your understanding.

Before the end of the month, we expect to invite you to an "open house" in Colon so that you may visit our train and actually walk through our passenger cars. At that time we will also provide you with the opportunity to choose and reserve the seat(s) of your preference.

To date, we have a total of 180 seats reserved and/or sold. There are still 20 seats available but we expect those to go rapidly. Please kindly review your reservations with us and make sure that we have you booked as requested. In the event that you wish to book another seat, now is the time. As you may understand, seats are sold on a first-come-first-served basis.

Thank you for your attention and please contact us for any questions or comments.

Regards, Thomas H. Kenna
Marketing Director

Passenger Service to start in April 2001

Nos complace informarle que la construccion del nuevo Ferrocarril de Panama procede segun lo planificado y esperamos iniciar nuestro servicio "Executive Express Train" durante la primera semana del mes de abril, 2001.

El "Executive Express Train" ha sido preparado tomando en consideracion los requerimientos especiales de los ejecutivos que viajan diariamente entre las ciudades de Panama y Colon.

Inicialmente, ofreceremos una salida de la Ciudad de Panama a las 7:00am para llegar a Colon aproximadamente a las 7:50am. En la tarde, el tren saldra de Colon a las 5:00pm llegando a la Ciudad de Panama a las 5:50pm. En Panama, contamos con una amplia area de estacionamiento cercada.

Los vagones del "Executive Express Train" cuentan con una elegante decoracion, aire acondicionado y los asientos garantizaran un viaje comodo y de gran confort. Los pasajeros podran viajar descansando, o si prefieren, trabajando en las mesas de trabajo disponibles. Cada vagon cuenta con un "balcon" al aire libre donde los pasajeros podran fumar o simplemente disfrutar del viaje al estilo natural. Tambien ofreceremos servicio de cafe y refrescos. Realmente sera una experiencia singular y de primera clase. Ademas, representa la manera mas segura de hacer el viaje diario entre Panama y Colon.

Los asientos disponibles son limitados. A la fecha se han comprometido 148 puestos entre ejecutivos de la Zona Libre de Colon, Agencias Navieras y los puertos. El valor de boleto es de $25.00 diarios, ida y vuelta, con un minimo de venta de un mes. El puesto comprado "pertenecera" a la empresa y la misma podra rotarlo entre varios ejecutivos de la empresa.

Por favor no dude en contactarnos para cualquier consulta o para reservar su espacio abordo del "Executive Express Train" . Lo esperamos.

Thomas H. Kenna
Marketing Director

Kansas City Southern looks south of the border

Seeks to build rail line along Panama Canal

PANAMA CITY, Feb. 24, 1998-- Construction is scheduled to start in July on a new, $60 million railroad which will impact the global shipping industry by significantly reducing the ocean-to-ocean transit time across Panama.

The railroad, which is being built by Panama Canal Railway Company, a joint venture between Kansas City Southern Industries, Inc. and Mi-Jack Products, Inc. of Chicago, will relieve heavy traffic through the canal. The line will link Panama City on the Pacific and Colon on the Atlantic and make it possible to move freight in 1-1/2 hours.

Each year nearly 14,000 ships transit the canal, with a transit time of 8-12 hours. Large ships unable to utilize the canal can now move materials from ocean to ocean via rail. The system will allow containers to be unloaded at port terminals and be trans-shipped over land in 1-1/2 hours, providing secure in-bond, port-to-port service.

The railroad will utilize the new ports already in operation around the Panama Canal, including Evergreen's Colon Container Terminal, Stevedoring Services of America's Manzanillo International Terminal and Hutchison's Balboa and Cristobal Ports link them in a single-line track with two-way traffic at strategic locations. PCRC expects to schedule 20 train runs per day, 320 days per year, handling up to 307,200 containers per year. At maximum operation capacity (100% load factor, 365 operating days), the company plans to move 397,120 containers per year by double-tracking and double-stacking.

The original railroad initiated service in 1855. Today the lines and equipment are in disrepair, though a minimal freight service is still in effect. The $60 million investment plan includes new ties, continuously welded rails, new locomotives, new intermodal facilities in Balboa and Colon, and improving signaling and communication systems. The construction is estimated at 18 months.

The company also plans to cross-train new employees as transportation specialists, who will handle locomotive maintenance, track work, and customer service.

The agreement was facilitated by several government agencies, including the National Port Authority and the Autoridad de la Region Interoceanica (ARI). Led by Nicholas Ardito-Barletta, a former president of Panama, ARI is responsible for managing the reversion of the US military lands surrounding the Panama Canal by the year 2000. Almost $1 billion in investments has been committed in the reverted areas in Panama during the next six years.

Kansas City Southern Railway Company, one of the eight major railroads in the US, was founded in 1887 as a passenger and freight line. Mi-Jack Products, Inc. is the US's largest manufacturer of intermodal equipment and the largest independent, intermodal terminal operator.

Panama Canal Railroad Co. to complete the $30+ Million Interoceanic Railway in the year 2000

After more than 18 months of negotiation, the Panama Canal Railroad Company, a joint venture partnership of Kansas City Southern Industries (KCSI) and MI-JACK, has won the concession to reconstruct and operate the interoceanic railway. The line will link the ports of Balboa and Cristobal and will be extended to the newly constructed port of Coco Solo. MI-JACK, a manufacturer and operator of inter-modal facilities, will team up with KCSI for this project. KCSI, in conjunction with consulting engineers Bridgefarmer Panama will design and construct the railroad. The estimated date for completion of the project is in the year 2000. The railroad proposal was approved by the national assembly without modification and is awaiting final approval by the President, which is not expected to be a hindrance.

Carlos Espino, Director of the Panamanian Railroads, indicated that apart from some "very small deviations", the new line should follow the same route as the existing railroad. Surprisingly, no further blasting or excavation will be required to create the new route. Despite the original engineers' lack of technology, "the alignment is good", according to Dan Reagan, Chief Engineer of Bridgefarmer Panama. Although the current track is in very poor condition, Bridgefarmer engineers are using locomotives to make the preliminary geographic and topographic surveys. It will later be used to carry materials and personnel during the construction process. Mr. Reagan foresees no significant problems in the construction process, and commented that although the line is currently in the early planning stages, it will be completed "as quickly as possible".

Although many of the details of the proposed railway have yet to be decided upon, the concept is clear. The trains will be double stacked with containers and will run on a single track with passing sidings. The current estimate is that the railway would carry some 200,000 TEUs annually, although the possibility of a double track with a higher capacity still exists. The total cargo transit time, including loading, will be approximately 1.5 to 2 hours from Balboa to Colón.. The total time the train is in motion will be less than an hour, making it the most rapid mode of cargo transportation between the two oceans. The train terminals will be constructed adjacent to the port cargo facilities which will speed up cargo transfer from boat to train.

At the President's request, the terms of the concession mandate the provision of a passenger service. The passenger trains could make life easier for thousands of commuters who travel between Colón and Panama City every day. As a tourist attraction, the railway clearly has considerable potential for success. As it runs parallel to the Panama Canal and cuts through large tracts of rain-forest.

Kansas City Southern Industries (KCSI) is a Class 1 railway holding company which is aggressively expanding its international presence. The company recently secured a US$1 billion concession agreement to build 5,000 km of railroad in Mexico.

Espino commented that although some residents of the areas through which the railway crosses have expressed concern, he feels that no insurmountable problems have arisen. The Mayor of Colón voiced concern that the railway would cross a main access road to the city and create traffic jams, and even threatened to reject the proposal. Despite this posturing, the problem should be eliminated with a highway overpass.

During the bidding process, Kansas City Southern Industries and MI-JACK were the only group to bid exclusively for the railroad, while Bechtel and Hutchinson bid for the combined port and the railroad privatization. The terms of the concession agreement are the following; The Panama Canal Railway Co. will pay 5% of total income to the government until the total amount invested in the project (a minimum of $30 million) is recouped, and from then on 10% of the total income will be conceded. The term of the agreement is 25 years, with the option of renewal for a further 25 years.

The rainy season will hinder the construction schedule, as the initial 'dirt work' cannot be done in the rain. However, the infamous "El Niño", rather than putting a damper on the project, may lend a helping hand this year. The concurrent effects of El Niño may extend the summer through June or July, which would reduce the construction time considerably.

The Canal Railway project will have considerable impact in facilitating world trade The new railway and almost completed highway will complement the Canal. As we enter a new era of increased globalization, where the world economy is increasingly driven by international commerce, Panama will have even greater advantages to.

A U.S. Company Is Planning to Rebuild a Train Line Along the Panama Canal

Passenger service envisioned in future

A U.S. company plans to rebuild a train line along the Panama Canal to provide freight and eventually passenger service between Balboa on the Pacific coast and Colon on the Atlantic side.

The Panama Canal Railway Company will rebuild the roadbed and tracks along the approximately 43-mile route that has fallen into general disuse, said company official Jay Nadlman. The company, he said, hopes to begin the freight service by the year 2000. The original line was first built in Panama in the 1850s to accommodate the California goldrush and then was rebuilt at the turn of the century as part of the Panama Canal project.

The priority for the company will be shuttling "containerized" freight across the isthmus. However, the firm also plans to initiate passenger service, in conjunction with a major cruise line, to take visitors on sightseeing trips along the canal. Commuter train service for the local populace is also envisioned. Panama's legislature is expected to vote on the project soon, Nadlman said. Legislative approval is necessary before repair work can begin.

The company plans to invest $50 million, "at a bare minimum" in the project, and perhaps more, depending on construction costs, Nadlman said. The three to four trains that currently use the track weekly run at a speed of less than five kilometers per hour. The company intends to modernize the roadbed and track to enable it to run trains at 65-100 kilometers per hour. The company plans to employ local Panamanian workers to repair the track, subcontract work out to Panamanian firms, and respect environmental concerns in the area, "so we can be as good corporate citizens as possible," Nadlman said. He said one of the environmental concerns is that the route passes through a national park, but that any changes to be made, such as straightening out a curve in the track, will be done in a way to minimize environmental damage.

The company plans to employ fewer than the 350 people currently working on the railroad, taking advantage of the latest computer technology to operate the system.

The project is a joint venture of Kansas City Southern Industries in Missouri, said Nadlman, who is the firm's assistant general counsel. Southern Industries, he explained, is a diversified holding company that includes among its assets the Kansas City Southern Railway Company, which operates rail lines in the southern United States, and also has formed joint ventures with Mexican firms to run rail lines from Mexico City to the cities of Nuevo Laredo, Veracruz, and Lazaro Cardenas. Southern Industries created the Panama Canal Railway Company to work with a Chicago, Illinois firm, Mi-Jack Projects, which specializes in inter-modal equipment, such as making and selling cranes for lifting containers from rail cars.

Nadlman said his company hopes to take advantage of the hundreds of thousands of freight containers that arrive on both sides of the isthmus each year and "our goal is to move a percentage of them via land rather than via canal or truck." His company, he said, was looking for opportunities in Latin America to expand, and "this opportunity was brought forward by our partners at Mi-Jack." "We have a clear strategic vision of what we want to do -- we want to shuttle containers back and forth" across the isthmus, Nadlman said."We saw a chance to develop an inter-modal business along the Panama Canal that was fairly small, fairly self-contained and seems to have a great potential opportunity." The U.S. government, he added, is not involved in the project.

Eric Green, US Information Agency Staff Writer

Concession for Panama Railway approved in Parliament.
30 Jan 1998

The Parliament approved yesterday -42 votes in favor, 5 against, 0 abstains- the law project Nº 77, that states the concession from the Government of Panama to the transnational Panama Canal Railway Company, to operate and administrate the Panama Railway.

The concession was denounced by the opposition leaders as a mistake.

Message by the President of the Republic of Panama (in Spanish)
21 Jan. 1998


    En las próximas horas deben concluir las negociaciones y adoptarse los entendimientos entre distintas empresas privadas y el gobierno nacional que permitan el inicio de obras importantes para el país.

    Me refiero a las empresas que, mediante licitaciones, obtuvieron las concesiones del puerto de Balboa y del ferrocarril transístmico, y las entidades gubernamentales que regentan la aeronáutica civil, las obras públicas y los puertos.

    Tanto en Panamá como en Colón se realizarán tantas obras y se llevarán a cabo tantas transformaciones que las áreas terminales serán muy distintas de como las conocemos hoy.

    Como es sabido, el histórico ferrocarril de Panamá, el primer ferrocarril transístmico en América y que tanto sirvió en distintas épocas a todo el continente dejó de funcionar hace ya varios años. Era una actividad subsidiada por el gobierno de la antigua zona del canal y su reversión a Panamá constituyó desde el inicio una carga económica que con el correr del tiempo solo aumentaba.

    El escaso movimiento de pasajeros y carga entre Panamá y Colón, y la imposibilidad de pagar los crecientes costos y subsidios, acabaron finalmente con una vía ligada desde hace siglo y medio a nuestra historia.

    Con la revitalización de la actividad portuaria, producto de la privatización de los puertos de Balboa y Cristóbal, así como de la construcción de nuevos puertos, rápidamente resurgió la necesidad del ferrocarril y el consiguiente interés en su operación.

    Algunas dificultades surgidas por la ubicación de las terminales del ferrocarril en áreas de intensa actividad económica futura en Panamá y en Colón dilataron el inicio de las obras. Hay que tener presente que, en el lado Atlántico, en un espacio relativamente pequeño, tendrán cabida inversiones millonarias en el puerto de Cristóbal, en la nueva terminal del ferrocarril y en el proyecto Colón Puerto Libre. Y que, en el lado pacífico, el aeropuerto de Paitilla se va a trasladar a Albrook, el concesionario del puerto de Balboa va a iniciar una inversión también millonaria y el corredor norte está próximo a concluirse, todo lo cual hace de las áreas terminales unas zonas de desarrollo económico intenso como nunca habían existido.

    Eso, desde luego, me llena de satisfacción, porque soy un convencido de que sin obras de infraestructura como estas, o como la ampliación de la carretera interamericana, no podemos sentar las bases de una economía sólida.

    Sin embargo, sigo preocupado con la situación del empleo. Porque si bien es cierto que la construcción de obras genera empleos temporales, y los puertos y el ferrocarril generarán puestos de trabajo permanentes, la obtención de empleos en el futuro dependerá del grado de preparación que se tenga.

    Es por ello que no me canso de exhortar a los padres de familia, a los profesores y maestros, a que preparemos a conciencia a los jóvenes para los retos que les aguarda el futuro.

    Los gobiernos, ni este ni los que vengan, podrán crear los empleos que requieren los miles de bachilleres y profesionales que se gradúan todos los años. La empresa privada es la llamada a generar nuevos puestos de trabajo, para lo cual el gobierno está construyendo obras de infraestructura y privatizando empresas estatales, de manera que se puedan destinar mayores recursos a atender las necesidades de los que nada tienen.

    Los esfuerzos y sacrificios que como nación estamos haciendo serán en vano si a la transformación económica y la construcción de gigantescas obras de infraestructura no la acompañamos de una preparación profesional y técnica de los dueños del mañana: los jóvenes.

    Ojalá en este año que comienza le dedicáramos a ese propósito toda la energía y la imaginación que hemos demostrado en los momentos difíciles por los que ha atravesado nuestra nación.

    Dr. Ernesto Pérez Balladares
    Presidente Constitucional de Panamá


Carlos Espino appointed as New Director of the Panama Railroad
17 April 1997

El Ejecutivo designó a Carlos Emilio Espino como nuevo director del Ferrocarril de Panamá y
además contempla una serie de cambios en varios consulados en Europa.

Espino quien es miembro del Partido Solidaridad sustituye en el cargo a Víctor D`Anello, militante
del Partido Liberal Nacional.

Renuncia director del Ferrocarril
12 April 1997

El director del Ferrocarril de Panamá, Víctor D'Anello renunció a su cargo presuntamente por diferencias con los altos cargos de la Autoridad Portuaria Nacional (APN).

La subdirectora María del Pilar Guevara asumió temporalmente la Dirección del Ferrocarril. El Ejecutivo aún no ha comunicado si ha aceptado o rechazado la renuncia de D'Anello, quien fungía en el cargo desde septiembre de 1994.

La renuncia de D'Anello se da en medio del proceso de privatización del Ferrocarril, que fue ganado por el consorcio Kansas City South Railway.

Actualmente el Ferrocarril de Panamá cuenta con 246 empleados. Esta institución genera gastos anuales por B/.3.5 millones, pero apenas produce ingresos por B/.1.6 millones.

Víctor D`Anello es miembro del Partido Liberal Nacional, que preside el ministro Raúl Arango. El Ferrocarril de Panamá, opera como una dependencia de la Autoridad Portuaria, cuyo director es el perredista Hugo Torrijos.

En noviembre, D`Anello había cuestionado la actitud de la APN de marginarlo de las reuniones en torno a la privatización del Ferrocarril.

Branch Line News International
Newsletter Jan-Dec 1997

BLN 803.0268][PA]

Ciudad Panama - Colon: Built by the United States Government in the Canal Zone to the 1524mm gauge (which it shares with Finland and Russia) the 77km Ferrocarril de Panama or Panama Railroad has been effectively out of use since the landing of US troops in 1989.

A Balboa - Jardin Botánico tourist passenger train was the only FCP service shown in the December 1996 Thomas Cook Overseas Timetable, but it was not running in March 1997.

A BLN reporter had an armed escort on a shed visit, which revealed a few carriages recently partially repainted, three diesel locomotives under repair in the shed and a fourth in the yard looking operable. Tracks at Balboa showed evidence of use, possibly by some limited freight service. Long stretches of the railway are spanned at low height by the Panama Canal Commission's electricity transmission lines, giving the erroneous impression of an electrified line.

(Nothing to do with the FCP, but the Canal itself gives a unique opportunity to ride in passenger stock rail-hauled by 18 electric locomotives at once - without travelling on any railway track!)

Remarks as Prepared for Delivery Ambassador William J. Hughes Luncheon in Honor of Ambassador Eduardo Morgan U.S.-Panama Business Council Washington, D.C.
October 15, 1996

-- Panama is in the process of developing its own "dry canal" to move containers via land across the Isthmus. The Kansas City Southern Railroad is negotiating a concession to rebuild and operate the Panama Canal Railroad. Remember, the old Panama Railroad was at one time the highest-priced stock on the New York Stock Exchange, and it shows real promise once again.



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