Join us Read
Listen
Watch
Book
Our Planet Climate and Geopolitics

Panama Canal proposes $1.6 billion dam to tackle drought

Panama Canal proposes $1.6 billion dam to tackle drought

Shipping traffic through the Panama Canal is finally rebounding after two years of drought exacerbated by El Niño. But water levels in Lake Gatún – the rain-fed reservoir that feeds it – are still around a foot below normal after reaching record lows in June 2023.

Authorities in charge of the waterway, which accounts for over 3 per cent of Panama’s GDP, are rushing to find solutions. The canal’s deputy administrator told Reuters a $1.6 billion project to build a reservoir on the Rio Indio would be the “most complete solution [to more frequent droughts] in a 50-year horizon”.

The problem? Building a dam would require the relocation of some 2,260 people and could intensify battles between the canal and canalside communities for freshwater supplies.

If it wins approval the project could be completed by 2031. Time is ticking: last year was the third driest in the canal’s 110-year history.


Enjoyed this article?

Sign up to the Daily Sensemaker Newsletter

A free newsletter from Tortoise. Take once a day for greater clarity.



Tortoise logo

A free newsletter from Tortoise. Take once a day for greater clarity.



Tortoise logo

Download the Tortoise App

Download the free Tortoise app to read the Daily Sensemaker and listen to all our audio stories and investigations in high-fidelity.

App Store Google Play Store

Follow:


Copyright © 2025 Tortoise Media

All Rights Reserved