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Project to widen Panama Canal is put on hold

Feb. 7, 2014 at 12:48 PM   |   Comments

PANAMA CITY, Panama, Feb. 7 (UPI) -- Work on the Panama Canal expansion project has been put on hold due to a dispute over unexpected expenses, a construction firm based in Spain said.

The Sacyr SA construction firm, the largest company in the GUPC consortium that is widening the canal, is at loggerheads with the Panamanian Canal Authority over cost overruns, the Wall Street Journal reported Friday.

The consortium contends the Canal Authority has refused to shoulder any of the unexpected costs that have been caused by inclement weather and labor disputes, the Journal said.

"A deal [with the Canal Authority] is the only solution to allow that work will be resumed immediately and the project will be completed in time," GUPC said in a statement.

The $3.1 billion project has run into $1.6 billion in cost overruns, the Journal said.

Some of the costs under dispute will be settled by an arbitrage court in Miami, but that will still leave some expenses unresolved, the Journal said.

© 2014 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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