Standing on a barge cruising through the Panama Canal's Gaillard Cut, Maximiliano DePuy beams proudly. The geotechnical engineer for the Panama Canal Authority points to the 539-ft-high Gold Hill promontory on one side of the waterway, from which 75 ft of rock has been cut out since 1986. On the opposite bank looms Contractor's Hill, already reduced to 370 ft in previous work. Stabilizing the canal's landslide-prone slopes metaphorically represents protecting a precious pathway for Panama, owner of the 51.2-mile-long construction landmark since 2000, when the U.S. turned it over to the locally run Panama Canal Authority. THEN AND NOW