The Panama Canal Authority issued and released the attached Advisory to Shipping No. A-04-2017 regarding manoeuvring requirements in Panama Canal waters. This advisory has generated some confusion with regards to the type of Fuel a vessel can burn while in Panama Canal waters (anchorages & Canal). After lengthy consultations with the PCA, we have managed to ascertain the following regarding the Advisory:

1. The requirement to switch to MGO/MDO for manoeuvring in the canal is not new and has been in place since 1 January, 2001 but the same may have been overlooked by the Industry.
2. The requirement mandates that all vessels must switch from Heavy Fuel (even if it meets the 3.5% sulfur content cap) to Light Fuel (MGO or MDO) meeting all IMO specifications, especially the cap on sulfur content which is also set at 3.5% in the Panama Canal. 
3. We can inform the Industry that the position of the Panama Canal Authorities is that all vessels while entering and remaining in Canal waters are required to burn Light Fuel (MGO/MDO) with a sulfur content not to exceed 3.5% m/m.
4. Alternatively vessels can burn one of the following products under the conditions stated below:
     - Heavy fuel with less than 3.5 % sulfur content provided the vessel is equipped with an
     approved exhaust gas cleaning system (scrubber).
     - Hybrid fuel as defined in the Advisory. No scrubber is required for burning this type of fuel.
    
   We reiterate that the use/ burning of Heavy fuel oil is only permitted on ships that are
   equipped with an approved exhaust gas cleaning system (scrubber).
5. Vessels approaching Canal waters must switch to MGO/MDO (or alternatively one of the fuels listed under paragraph 4 above) until departure from Canal waters. Since the changeover usually is not instantaneous, and requires some time, the vessel shall start the changeover procedure with sufficient time to ensure arrival in Canal waters fully compliant with the requirement. It is not necessary to report the completion of the changeover procedure.

With full acknowledgement and thanks to the UK P&I Club's correspondents in Panama, C. Fernie & Co., S.A. for the above briefing. Members may direct questions on this subject to

Fernie@cfernie.com

, with copy to your usual contact at the Club.