Configure Panels That Uses View With Entity Reference For User Profile
The %user portion of your URL is called an argument.  Your final screenshot shows that argument and that you can use %user_uid in your page.  So that's the context handled.

Instead of a page or block, make a content pane for your view, you will need to enable the Views content panes if you haven't already.

In that content pane, set your argument to From context and choose User->User ID from the dropdown.  This tells the view where to get the information for your contextual filter (which looks ok I think).

Once you have saved that, go back to your page in page manager and insert the view pane as content, it will ask you where to get its argument from, choose Argument 1 because that will refer it to the %user portion of your URL.