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Panama on September 3rd formally embarked on an ambitious seven-year project to expand the Panama Canal to not only accommodate super cargo container ships but even the largest cruise ship now on the drawing boards.

The start of construction was marked by an explosion blasting away part of a hillside next to the canal.

“This marks a new era for the Panama Canal,” declared President Martin Torrijos.

Former U.S. President Jimmy Carter, who while in office authorized the transfer of the canal to Panama in a controversial treaty he signed in 1977 with Panamanian strongman Omar Torrijos, was among the estimated 40,000 people attending the ceremony.

As part of the $5.25 billion expansion, two new sets of locks will be constructed measuring 1,400 feet long and 180 feet wide with a 50-foot draft. The current locks are nearly 1,000 feet long and 110 feet wide a 39 foot draft.

The huge new 5,400-guest Genesis-class ships ordered by Royal Caribbean, at 1,180 feet long and 154 feet wide, easily will fit through the new locks.

By comparison, Royal Caribbean's Voyager class ships, the Princess Grand class ships, and Carnival's Conquest class ships -- not to mention Cunard's Queen Mary 2 and Royal Caribbean's Freedom and Liberty of the Seas -- are among the almost two dozen cruise ships that currently cannot use the canal.

As part of the ambitious construction plan, canal entrances at both the Atlantic and Pacific ends of the Canal also will be widened and deepened, as well as the navigational channel through Gatun Lake.

Construction of the new lane would not interfere with passage of ships through the canal, according to the Panama Canal Authority, since the two current lanes would not be closed and construction would take place outside existing channels.