MADRID Jan 1 Work on the massive Panama Canal
extension project may be suspended after a clash between the
builders and the Panamanian authorities about $1.6 billion in
cost overruns, according to a statement from the building
consortium on Wednesday.
The cost overruns on the $3.2 billion canal extension, one
of the world's largest construction contracts, should be met by
the Panama Canal Authority (PCA) under the terms of the
contract, argued the consortium comprised of Spain's Sacyr,
Italy's Impregilo, Belgium's Jan De Nul and Panama's
Constructora Urbana, SA.
The overruns were the result of unforeseen events during
construction, something which was "normal" in these kind of
projects, it said.
The group believes the PCA has "failed in its obligations as
set out in the contract as well as in the inexactitude of the
information provided to the consortium to carry out the
Under the terms agreed, the PCA has another 21 days to
comply with the requirements, it added, during which work will
No one at Sacyr was immediately available for further
Problems with the Panama project come at a bad time for
Sacyr, whose total net debt stood at 6.9 billion euros at the
end of September, more than three times its market