GRANADA, NICARAGUA — Construction on the $50 billion Nicaragua Canal, which has been wracked by delays, will not begin until the first quarter of 2016 due to new environmental mitigation measures, according to a high-ranking government official, JOC.com reported.
Paul Oquist, executive director of the Nicaragua Grand Canal Commission, said that U.K.-based Environmental Resources Management, one of the canal’s environmental assessment contractors, has recommended four additional studies to identify new ways to reduce the environmental impact of the project.
“We and (Nicaragua president Daniel Ortega) have made the decision that all studies recommended by the environmental groups have to be undertaken,” Oquist said Sept. 22 in Washington, D.C., U.S., at a forum sponsored by the Council of the Americas. “No stone will be unturned in terms of the environmental elements.”
Work on the canal had originally been scheduled to begin in early 2014 and was pushed back to the start of 2015, due in part to delays in identifying the waterway’s path. The 2016 start will include solicitation of bidding briefs for dredging, excavation, the locks, and two new ports to be built as part of the project. The canal will take five years to build.
The project has been looked upon with skepticism due to its high cost and potential environmental damage. Project concessionaire HKND Group, led by Beijing-born billionaire Wang Jing, has yet to name investors.
The head of the Panama Canal, whose new locks are expected to begin operation in mid-2016, has said the Nicaragua project is not a “feasible investment.” The new locks in Panama, which can presently only handle ships of 5,000 twenty-foot-equivalent units (TEUs), will allow it to accommodate ships of 13,000 TEUs.
Fueling skepticism about the project is that financial and economic feasibility studies undertaken for the project by U.S.-based consulting firm McKinsey & Co. had been scheduled to be circulated among the world’s investment banks in late 2014, but that has not happened. Those studies are still ongoing, Oquist said
Oquist refuted claims by environmental groups that 100,000 indigenous people living along Lake Nicaragua would be displaced by the project. A government census study put that number at about 28,000 people, Oquist said, “and we will accommodate them.”