Panama Canal Expansion Continues, Despite Suspension Threat
The consortium contracted to build the third set of Panama Canal locks, Grupo Unidos por el Canal (GUPC), continued construction on Jan. 20, said a Panama Canal Authority (ACP) executive. Formed by firms Sacyr of Spain, Salini-Impregilo of Italy, Jan De Nul of Belgium and Constructora Urbana, SA (CUSA) of Panama, GUPC threatened on Dec. 30 to suspend construction on the canal project if ACP refused to pay a $1.6 billion cost overrun claim (see 14010810). Negotiations remain underway, according to both parties.
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“During the weekend, ACP has maintained communication with the head of Sacyr, leader of the consortium GUPC, to find a solution to the current situation. The ACP will review all proposals presented formally and always within the provisions of the contract,” said ACP in a Jan. 19 press release (here). “The ACP rigorously and continuously monitors the developments in the field in order to keep track of everything that involves a reduction of work and the suspension announced for tomorrow. Today, the ACP Administrator, executives and technical personnel conducted an inspection of the construction site in the Pacific to witness first-hand the progress.”
European Union participation in mediation efforts, spearheaded by European Commissioner Antonio Tajani, is a positive sign, said GUPC in a Jan. 20 emailed press release. The ongoing dispute, however, jeopardizes timely completion of construction, said GUPC. The statement did not address production levels. Llorente & Cuenca, the public relations firm representing GUPC, did not respond for further comment.
“The works, which have a cost of over 100 million dollars a month have today reached 70 percent completion and technically speaking, nothing prevents us from reaching the finishing line. The only impediment is the difficult financial situation which has arisen due to the additional costs which occurred during the execution of the works, for which GUPC has requested relief,” said GUPC in an Jan. 20 press release. “Failure to reach an agreement on co-financing of the unexpected costs will result in a serious delay and it will mean that the works will not be finished in 2015 causing damages to all parties involved.”