The total cost for Panama’s ambitious Metro Line 3 monorail project has escalated to $4.481 billion. This new figure incorporates nearly half a billion dollars in financing costs for a newly added underground tunnel section that passes beneath the Panama Canal. Panama’s Comptroller General, Anel Flores, formally approved the contract’s seventh addendum on November 20, 2025, solidifying the financial and construction changes for the major public transit expansion.
This financial adjustment follows a significant engineering decision to bury a 4.5-kilometer segment of the route. The original 25-kilometer elevated line, designed to connect Albrook with the Ciudad del Futuro in Panama Oeste, was modified to include a subterranean passage. Construction on this complex tunnel section has already reached 45 percent completion, with crews successfully finishing the segment directly under the canal’s bed. The tunnel will eventually reach a maximum depth of 65 meters below sea level.
Panama Metro officials provided detailed breakdowns of the rising costs. The core construction contract price increased from an original $2.844 billion to $3.656 billion to account for the tunnel’s physical construction. The latest jump to $4.481 billion stems from adding the financing costs for that new underground segment. The total financing cost for the entire Line 3 project is now set at $825.6 million. This amount covers interest payments and other financial charges associated with the loans over their lifetime.
“The addendum includes the financing portion for the underground section incorporated into the original route.” [Translated from Spanish]
With the new financial framework approved, project managers are pushing forward on both the elevated and underground sections. The elevated viaduct running from Panama Pacifico to Ciudad del Futuro is reportedly 88 percent complete. Its construction schedule aims for finalization in the second half of 2027. Meanwhile, the tunnel boring machine, named “Panama,” continues its advance from the canal toward the Balboa area for planned maintenance.
Japanese Loans Form Financial Backbone
Funding for this massive infrastructure undertaking comes primarily from concessional loans provided by the Government of Japan. These loans are managed through the Japan International Cooperation Agency (JICA) under an Official Development Assistance (ODA) framework. The financial package covers civil works, including the tunnel, the monorail system itself, and technical supervision. Panama’s Ministry of Foreign Affairs confirmed a new loan tranche formalized on August 8, 2025, for 382.844 billion yen, approximately $2.486 billion. This loan carries a 14-year amortization period with a 6-year grace clause.
To help offset the tunnel’s substantial expense, Panama Metro made several design modifications. The number of stations was reduced from 14 to 12, deferring the Vista Alegre and Arraiján stations for future expansion. The agency also trimmed the planned train fleet from 28 to 26 vehicles. Another adjustment, included in an earlier fourth addendum, scaled back architectural investments at station entrances, saving an estimated $49 million. To date, Panama Metro has disbursed $2.424 billion for construction progress.
Full Opening Anticipated for 2028
Project officials have tempered expectations for a partial opening. While tests have been conducted on electrical substations in the elevated section, official trials on the main guideway are not scheduled until the second quarter of 2026. The idea of opening the elevated segment independently while tunnel work continues has been effectively shelved. Planners found no viable temporary solution to transport the large volume of passengers expected to arrive at the Panama Pacifico terminal into the city center.
Initial concepts like a dedicated bus service or even a cable car link were studied but ultimately rejected. The current timeline points to a single, integrated launch. This means residents of Panama Oeste will likely wait until 2028 to ride the full line. When operational, the system is projected to handle over 160,000 passengers daily with its fleet of 26 trains. The twelve confirmed stations will serve communities including Ciudad del Futuro, San Bernardino, Nuevo Arraiján, Balboa, and Albrook.
“Partial operation is not currently planned… operation would be postponed until the underground section is operational.” [Translated from Spanish]
The project represents one of Latin America’s most significant current public transit investments. Its success hinges on integrating complex above and below-ground infrastructure across a challenging geographic corridor. The final cost, now solidified by the comptroller’s approval, reflects the premium for engineering a solution beneath one of the world’s most critical maritime passages. All eyes will remain on the tunnel boring machine’s progress and the elevated guideway’s final assembly as Panama works to connect its western suburbs to the urban core.