$300m submarine cable project to connect US and Panama

Ocean Networks (ONI) is to launch a submarine cable system linking Florida to Panama. 

The project, named Caribbean Express (CX), will use an 18-fibre pair submarine cable system and space division multiplexing (SDM) technology to connect West Palm Beach in Florida to Balboa, Panama; Cancun, Mexico and Cartagena, Colombia with high-speed, low latency fibre optic connectivity. 

Development of the route, including market analysis, permit and environmental studies and securing landing party agreements has already received significant investment, says ONI, but to complete the funding of this $300m project, the firm has engaged Commenda, an Atlanta-based merchant bank. 

Because of the scale and importance of such a link to these markets, the company envisages that there may also be several governmental partners in this project. Because of this, it has positioned ‘branching units’ in strategic locations along the route to easily enable future connectivity. 

Upon completion CX will offer new dedicated dark fibre pair indefeasible rights of use (IRUs) in the Caribbean market. In conjunction with the remaining capital commitments, supplier requests for quotes will be issued in March to selected system suppliers, with the awarded contracts in force by July. 

Robert Hildebrecht, CFO at ONI said: "We are excited about launching this new submarine cable digital superhighway across the Caribbean. We selected Commenda to raise the balance of the capital for this project based on the experience of their team and their successful track record in advising rapidly growing companies like ONI. With the support of Commenda and the experience of the ONI team, we fully expect the Caribbean Express cable system to be completed on schedule and under budget.’

John Runningen, a founder and principal of Commenda commented: ‘The consumer demand for a new submarine cable system between Central America and the US is enormous. Traffic is nearly doubling every two years. As a result, ONI has already received significant subscriber interest from large IT and telecom customers who are anxious to expand their presence in these new and under-served consumer markets.’

ONI management states that several large corporate customers have already indicated an interest in either a dedicated fibre pair or managed bandwidth as soon as the system is completed in early 2024.